QUICK QUILL — North American consumer confidence is deteriorating, and RCM/TIPP says take the under on Friday’s UMich. Credit managers are hearing echoes of 2007-09, with more emotion in payment disputes and are tightening underwriting standards, especially in the labor-intensive service sector. Combine the fundamental themes with Wall Street execs chirping about overvaluation risks, and equity and credit volatility look cheap.
TAKEAWAYS
- Canada and Mexico Consumer Confidence have historically moved with U.S. UMich Auto Buying Conditions; all three have cooled in recent months, in tandem with U.S. auto sales posting a weak 15.3 million SAAR in October, flagging an end-of-year loss of momentum
- After peaking at 54.0 last December, the RCM/TIPP Economic Optimism Index continues to sink, falling 9.1% MoM to 43.9 in November; given the series has historically guided UMich Consumer Expectations, it flags downside vs. the latter’s 50.5 consensus
- The combined NACM Mfg/Services CMI for Disputes has fallen 2.8 points in the last four quarters to 48.8 in October, beneath the long-run average; the decline mirrors a similar downtrend in the four quarters ended Q1 2008, when the CMI for Disputes was 48.6