This month’s preliminary reading from the University of Michigan’s Surveys of Consumers is a gut punch, clocking in at 50.3, down 6.2% from October’s 53.6 and a whopping 29.9% below last November’s level.
It’s the second-lowest on record since the survey kicked off in 1960, edging just above the all-time low of 50.0 hit in June 2022 amid peak inflation chaos. The “current economic conditions” sub-index cratered to a record low of 52.3 down 10.8% from last month, driven by a 17% plunge in views on personal finances, while the “consumer expectations” index slipped to 49.0, its weakest in six months.
This isn’t just a blip; it’s widespread gloom cutting across ages, incomes, and even political lines—everyone’s feeling the squeeze except the stock-market heavyweights, whose sentiment actually rose 11% thanks to near-record S&P highs.
Year-ahead inflation expectations ticked up to 4.7% from 4.6%, but long-run ones eased slightly to 3.6%, hinting at some guarded optimism on prices stabilizing eventually. A federal government shutdown that’s dragged on for over a month, sparking fears of broader economic fallout—like delayed payments, furloughs, and a hit to growth.
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Joanne Hsu, the survey director, nailed it: “Consumers are now expressing worries about potential negative consequences for the economy.” Layer on sticky inflation still biting at essentials, high borrowing costs, and job jitters unemployment ticked to 4.4% in October, and it’s no wonder folks are battening down the hatches.
Consumer spending drives ~70% of U.S. GDP, so this vibe check could throttle holiday retail and Q4 momentum if it lingers. While Main Street’s hunkered down paycheck-to-paycheck households are livid about inequality and “booming” markets that feel rigged.
Wall Street’s partying: S&P 500 near all-time highs, GDP chugging at 3.8% annualized in Q2, and private payrolls adding 42,000 jobs last month better than feared, but still a slowdown. It’s a classic disconnect—asset owners thrive on low cash holdings fund managers at 3.5-3.8%, lowest in 15 years and AI hype.
The average American sees grocery bills up 20% since 2021 and shutdown uncertainty as recession signals. If the “bubble” you’re eyeing is stocks or maybe housing/commercial real estate, this sentiment crater is a flashing yellow light.
Perceptions are already recessionary, worse than 2008 in spots, yet markets shrug it off. History says sentiment leads spending by 3-6 months, so watch December’s final read out Nov 21 and jobs data for cracks.
The Conference Board’s Consumer Confidence Index (CCI) is a key monthly gauge of U.S. consumer attitudes toward the economy, based on surveys of about 3,000 households. It breaks down into two main components.
Present Situation Index (PSI): Measures views on current business/labor conditions and personal finances. Gauges short-term outlooks for income, business, and jobs readings below 80 often signal recession risks.
Unlike the University of Michigan’s sentiment index which hit a near-record low of 50.3 in preliminary November data, as we discussed, the CCI tends to be more volatile and employment-focused. It’s released mid-month preliminary around the 10th-15th.
We’re still awaiting the official November 2025 release—expected on Tuesday, November 25 delayed slightly due to the ongoing federal government shutdown impacting data collection. The cutoff for the survey was likely around November 10-12, so it may capture some early-month shutdown effects.
The most recent data is from October 2025, released on October 29. 94.6 down 1.0 point from September’s upwardly revised 95.6—a six-month low, in the 41st percentile historically. Present Situation Index: 129.3 up 1.8 points—modest improvement, but still below 2025 averages amid sticky inflation.
Expectations Index: 71.5 down 2.9 points—below the recession-warning threshold of 80 for the ninth straight month since February 2025, reflecting pessimism on future jobs and growth. This sideways slide marks the third consecutive monthly decline, with consumers citing inflation especially at the pump and groceries, tariff uncertainties, and the government shutdown as top drags.
Recession fears eased slightly fewer expect one “very likely” in the next year, but more now believe we’re already in one—for the third month running. Holiday spending plans are muted: While some started early to dodge potential tariffs, most intend to shop October-December.
With November peaking—but overall budgets are tighter, especially for lower-income households <$75K and younger folks, where confidence dropped sharply. Both indices show deteriorating vibes, but Michigan’s plunge is steeper—highlighting the “bubble” disconnect you mentioned strong markets vs. Main Street pain.
With the shutdown now in its second month, November’s CCI could dip further if furloughs and delayed payments amplify gloom—potentially crimping holiday retail consumer spending = ~70% of GDP. Yet, like Michigan, it’s a perception gap: Unemployment at 4.4%, Q3 GDP at 2.8% annualized, and S&P highs mask the squeeze for non-asset owners.
Economists like Stephanie Guichard note: “Confidence is stuck in a narrow range since June,” but a shutdown resolution could spark a rebound. If not, expect Q4 growth to cool toward 1.5-2%.Watch for the November drop on the 25th—I’ll keep an eye out.