I Have No Confidence in the Consumer Confidence Index

On the last Tuesday of every month two pieces of data are released. We get the monthly update on the Case-Shiller Home Price Index, which is based on thousands of real estate transactions, in which real families spend what is often their life savings. And we get the monthly number from the Conference Board’s Consumer Confidence Index, which is based on a short questionnaire sent to 5000 households asking them how optimistic they feel.

CCI Chart Yesterday the C-S 20 City Composite showed a nice little uptick, +0.8% for April, +3.8% year on year. That reversed a few months of downticks and was reassuring to those of us rooting for stability in the housing market.

The CCI, on the other hand, was down to 52.9 from 62.7. That undoes two months of gains and returns us to a point just above the March level.

How did the stock market react? Was it cheered by what households actually did with their money in April or depressed by what they said to pollsters in June? The S&P was down –3.1%.

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Spending Ten Hours a Day Worrying About Debt

Last week WalletPop brought us Worrying about debt costs you an average of three and a half hours a day.

Harrumph.C Cards 2 (Andres Rueda)

The data is from a survey carried out by an outfit called Survey Sampling International. I’ll give them credit for having one of the more intriguing taglines I’ve seen in a while: “Superior data wrapped in an engaging experience.” I’ve no idea what that means. Which makes it intriguing.

The survey, conducted on-line with a sweepstakes entry as compensation, was done on behalf of DebtPlan.com, a site that appears to provide basic on-line debt management tools for $14.95 a month.

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The Market for Used Life Insurance

Brasner Mug ShotI will admit that what got me to click on the article at the Wall Street Journal was the mug-shot-like picture of the sad middle-aged guy who could really use a shave.

Turns out, the picture is mug-shot-like because it is, in fact, a mug shot. The ennui filled subject is one Steven Brasner, a Florida life insurance salesman. He has the unmistakable look of a man who’s entire life has suddenly come crashing down around him.

I feel for the guy. It is not like the insurance thing was just a cover for some glamorously dangerous life of high-stakes crime. In that case you might expect an expression of I-knew-they’d-get-me-eventually resignation or perhaps an I’ll-beat-the-rap defiance. No, Brasner really sold insurance for a living.

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A Tax on People Who Can’t Do Math

I’m still on hiatus (and still unemployed) but I spent some of what was a glorious holiday weekend in New England indoors, surfing the web and reminding myself why I started Bad Money Advice.Lottery Tickets Crop

WalletPop had a post that caught my eye. Poor people spend 9% of income on lottery tickets; here’s why.  It discusses a theory about why “poor households, with annual take-home incomes under $13,000, on average, spend $645 a year on lottery tickets, which comes to about 9% of their yearly income.”

I am not going to express an opinion on the theory, because I didn’t have the patience to read the whole post. I couldn’t get past the first paragraph. 645 divided by 13,000 is 4.96%. That confused me until I realized the statistic refers to households with incomes of at most $13,000, and not an average of $13,000. It was that phrase “which comes to” that threw me off.

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