Consumer Confidence Takes a Hit

Consumer confidence has taken a hit for the second month in a row. This is not particularly good news on the corporate finance front. With consumers not terribly confident about the economy, it means that they are less likely to spend money. This means that the cash flow into many companies is likely to remain low.

The consumer confidence data is also having an effect on how companies view the possibility of a rebound in spending for the holidays. Many businesses have been hoping that holiday shopping would help get things going. However, with consumers still wary about economic recovery, it means that they are less likely to go on much of a spending spree for the holidays. And that means that many companies are already bracing for a disappointing Christmas shopping season.

Consumer confidence has been affected in large part by employment concerns. The labor market has remained stubbornly weak, and that means that consumers, who see the realities of lay-offs in their daily lives, are concerned about the way things are going. Until more jobs are created, consumers are likely to remain wary of economic recovery — and of spending money.

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