2023 was a weird year for consumers

  • last year
Despite record inflation and high interest, consumers continued to spend in 2023. J.D. Durkin sat down with Dana Peterson, Chief Economist at The Conference Board, to discuss.
Transcript
00:00 Dana, what are you expecting in the realm of consumer confidence for the new year?
00:04 Do you expect to see a more confident consumer?
00:09 Actually we don't and that's because we actually have a recession call for the first half.
00:14 A recession that will be short, it will be shallow, it won't be too painful, we won't
00:18 have that many job losses, the unemployment rate's not going to spike, maybe it rises
00:23 to around 4.3 percent.
00:25 But if you hear that your neighbor's been let go or that things are a little bit tough,
00:30 earnings are not so great, stock market's not doing so well, then you're probably not
00:36 going to have as good a confidence.
00:38 So we would expect that confidence would probably start taking back down again in the first
00:42 half of 2024.
00:43 Dana, what are the biggest headwinds you think facing the consumer once we turn the calendar
00:48 page to 2024?
00:51 Well I think one of the biggest headwinds will be again that recession we're calling
00:55 for.
00:56 But even if we don't have a big recession, we could still see a slowdown and that'll
01:00 feel like a recession.
01:02 And for many consumers, especially if you're in certain industries like technology or transportation
01:08 and warehousing or residential construction, we are seeing some layoffs and that may intensify.
01:13 So that's going to impact the consumer and certainly those folks who might have been
01:17 thinking about buying a big ticket item, now they won't because the interest rates are
01:21 high.
01:22 No one's really thinking about buying a home because mortgage rates are high and they're
01:25 probably not going to fall off very quickly, very rapidly.
01:29 So I think those are all going to be very much headwinds for the consumer ahead.
01:33 [End of Audio] Duration: 2 minutes and 30 seconds
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