Recall that 70% of our GDP is based on consumer spending, and you understand why consumer confidence is of paramount importance. If frightened consumers cut their spending by 10% this year, it would amount to a 7% reduction in GDP.....a reduction of over a trillion dollars in output and income.
Luckily, Gallup’s consumer confidence index has improved recently. And other polls show that public sentiment is not great, but at least it has not degraded in recent months.