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Off-Balance Sheet: Consumer Confidence Sinks


The March index was the lowest since November 2006, when the figure was 105.3.


Relax, it's only money. Here in the 'Ville we like to keep things smart, but we also love to laugh. All work and no know how it goes. With that in mind we give you The "Off-Balance Sheet," a place where Minyans can experience humorous takes on the world of finance, personal stories from our Professors and Minyans and all the other stuff that makes life worth living. So take a break from the flickering ticks and dive in.

The consumer confidence index fell to 107.2 from 111.2 in February-below the 109 analysts had expected.

The March index was the lowest since November 2006, when the figure was 105.3.

"Apprehension about the short-term future has suddenly cast a cloud over consumers' confidence," Lynn Franco, director of the Conference Board Consumer Research Center said.

How Bad Is It?

I hit the streets to gauge the supposed lack of confidence for myself.

First stop: Best Buy (BBY).

Walking through the front door, I could almost sense the insecurity. No one would make eye contact with me, skittish customers quickly shuffled away when I tried to approach them-even the salespeople were acting like awkward teenagers at a school dance.

A Best Buy employee, wracked with self-doubt

I approached a young mother in the printer aisle.

"Pardon me, would you mind taking a second to speak to me about consumer confidence?"
She shoved her hands in her pockets and stared at her shoes.

"Um, why would you want to speak to me?" she asked in a quivery, uneasy voice. "My opinion doesn't matter. I'm nothing," she mumbled as she quickly left the area.

I headed to Macy's (FD), where I found consumer confidence to be even lower than it had been at Best Buy. The shoppers' low self-esteem was palpable as soon as I walked through the revolving doors.

Inside Macy's, where customer confidence levels were incredibly low

I walked up to a man and his wife in the outerwear department, where he was trying on jackets. Before I had a chance to speak, he asked me a question of his own.

"This looks terrible on me, right? I don't look good in anything," he said as his wife glanced nervously toward the escalator. "Why couldn't I have been born attractive? God, I hate myself."

An angst-ridden Macy's shopper

I ducked into Tiffany & Co. (TIF), where worried-looking customers acted like shelter dogs, silently slinking away every time I made an attempt to interview them. I walked through Niketown (NKE) looking for someone willing to talk to me, but met with even less success. Determined to find a consumer with the confidence to give me a quote, I tried my luck at the achingly happy Disney Store (DIS), where no one but Mickey, Minnie, Goofy, and Pluto had any confidence to speak of.

Confident Disney characters perform for an anguished child (front, on knees)

What Does This Mean For Investors?

I turned once again to Minyanville's resident consumer confidence expert, Kevin Depew, but he was hesitant to be interviewed.

Kevin, why are you in silhouette?

I…I, uh…I, I, I just don't really want anyone to look at me right now. I have this overwhelming lack of confidence, especially when I'm shopping…I don't even know why you're wasting your time with me.

I wanted to know what you thought of the-

I've got to go to my therapist. Bye.

And, with that, Kevin rushed to the elevator and took off.

In short, it's true: consumer confidence is low. That said, I'm long GlaxoSmithKline (GSK), manufacturer of Paxil, Forest Laboratories (FRX), which brought anti-anxiety drug Lexapro to the U.S. market, and Pfizer (PFE), makers of Zoloft.

I'd like to reassure consumers that this crisis of confidence will indeed pass. Try to stay active and avoid engaging in activities that exacerbate your feelings of worthlessness.

Hang in there.
No positions in stocks mentioned.
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