Consumer Sentiment Unexpectedly Rises to 5 Year High

     We've been getting a lot of headlines like this lately at at time that is quite fortuitous for President Obama. Last week we saw that with some revisions for July and August, the unemployment rate dropped to 7.8%-the lowest since the President has been in office.

     Yesterday, new jobless claims dropped to the lowest since early 2008 at just 339,000-generally when they are below 375,000 this is considered good enough to lower the unemployment rate.

     Also, yesterday, we saw foreclosures at their lowest level since 2007. Now, today, consumer confidence which was predicted to be flat of perhaps drop slightly at around 78 spiked all the way to 83:

     "U.S. consumer sentiment unexpectedly rose to its highest level in five years in October as consumers became more optimistic about the overall economy in a possible boost to President Obama's reelection hopes next month."

      "The Thomson Reuters/University of Michigan's preliminary October reading on the overall index on consumer sentiment came in at 83.1, up from 78.3 the month before, and the highest since September 2007, the survey showed on Friday.It was well above the median forecast for a slight decline to 78 among economists polled by Reuters."

       "The new buoyancy among consumers comes shortly after the U.S. unemployment rate tumbled to its lowest level in nearly four years in September as more people returned to the workforce and found jobs than economist had predicted. (Read more: America's Highest Paying Jobs)"

      "We are getting some quite interesting signals from consumer sentiment and employment data — both (the) unemployment rate and initial claims — that there has been some quite significant improvement in the economy," said David Sloan, an economist at 4Cast in New York."

 

       http://www.cnbc.com/id/49388260

 

       Note that all these better numbers come after Bernanke's QE-Infinity as well. The confidence is also about the long-term picture:

 

       "The unexpected jump in consumer sentiment in October came as consumers felt better about the economy in both the long and the short term, the compilers of the Thomson Reuters/University of Michigan survey said."

       "What changed was how they (consumers) evaluated economic conditions," survey director Richard Curtin said in a statement. "Economic conditions during the year ahead were expected to be 'good' by more consumers, and more consumers expected 'good' economic times over the next five years."

 

        One of the most important aspects of Biden's performance last night was his full-throated defense of the President's record. This latest report seems to give more validation of the idea that Clinton suggested back at the DNC-that the President has put on place the foundation for recovery. Clinton had wanted to assure people that it's there even if they don't "yet feel it."

 

        What we've seen lately suggests they may well be starting to feel it.