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September 29th, 2009
11:45 AM ET

Financial Dispatch: Consumers less confident

Gene Bloch
CNN New York Managing Editor

A weed sprung up among those “green shoots” this morning. Consumer confidence declined unexpectedly in September, raising concerns about how retailers will fare this holiday season. The Conference Board’s index fell to 53.1 from a revised 54.5 in August. Economists were looking for a reading of 57. "Consumers remain quite apprehensive about the short-term outlook and their incomes," said Lynn Franco, director of the Conference Board Consumer Research Center. "With the holiday season quickly approaching, this is not very encouraging news."

The news on housing this morning is more encouraging. For a third straight month, home prices increased in July, according to the S&P Case-Shiller index. That measure of prices in 20 cities rose 1.6 percent in July from the previous month. Prices are down 13.3 percent year-over-year, but that was a smaller decline than expected.

Stock prices are slightly lower in the early going today – one year ago today the Dow Industrial Average suffered its worst point-decline in history, down nearly 778 points, as the financial crisis deepened.

How safe is your money in the bank? Bank accounts are insured up to $250,000 by the Federal Deposit Insurance Corporation, but after nearly 100 bank failures this year alone, the FDIC needs to be replenished. What the best way to do that? Refilling those coffers is the subject of a FDIC board meeting today in Washington. The Wall Street Journal reports the FDIC will propose that banks pay their fees upfront for the next three years to restock the FDIC’s insurance fund.

But with the banking industry still reeling from the financial crisis—is this the right time to hit them up for that kind of cash? Poppy Harlow reports in today’s Breakdown.

Wall Street bonuses are poised to rebound. With the financial sector recovering, banks face a conundrum: Big bonuses could spark a backlash, but small bonuses could cause top talent to flee.

Good news on gas prices: AAA reports the average price of regular unleaded dropped 1.2 cents to $2.487 a gallon ($2.49 for graphics). That’s the 8th straight decline.

Gas is down 39 percent from the record price set in July 2008.

And finally, if you’re filling up with Starbucks – get ready for instant coffee. That’s right, starting today the chain will begin selling a “ready brew” called Via at all U.S. locations. Starbucks has struggled to compete with lower-priced rivals such as Dunkin Donuts and McDonald's as consumers have become more price-conscious amid the weak economy. Via, which the company began rolling out earlier this year in Seattle and Chicago, is sold in packs of three cup-sized servings for a suggested retail price of $2.95 or $9.95 for a 12 pack.

On CNNMoney:

* 7 percent raises for nonprofit CEOs. Median salary for executives climbed 7% in 2008 - and one had his compensation jump 99%.

* Should you hire a career coach? Paying for a pro may make sense – but exhaust free options first.

* Even bad reviews boost sales. Think letting customers post cranky reviews of your products will scare away sales? Here's the surprising truth.


Filed under: Economy • Finance • Gas Prices • Gene Bloch
soundoff (3 Responses)
  1. alex lyrics

    When people go from shopping at Whole Foods and now are shooping at dollar stores, you bet they are holding on.

    "Penny wise and dollar foolish. "

    September 29, 2009 at 1:32 pm |
  2. Amazing

    What is there to be confident about? Business is very slow, we layed off half our work force and all the Democrats can think about doing is raising taxes to pay for extended unemployment and all their spending. We may as well shut our doors too, we cannot afford Democrats destroying this country.

    September 29, 2009 at 1:04 pm |