Amid all the pre-election campaigning, President Donald Trump’s trade and nuclear negotiations with China and Russia, and rising interest rates and inflation, investors were depressed.
The Spectrem Household Outlook, which is designed to measure an investor’s optimism about four financial components in their daily lives, came in at 17.50 overall in October, a drop of almost 13 points. The overall Outlook has not been below 20 since June of 2017. The Millionaire Outlook is rarely lower than the non-Millionaire Outlook, but in October Millionaires reported an Outlook of 13.67, a 20-point drop and the lowest since October 2016 (also the last time the Millionaire Outlook was below 20).
For non-Millionaires, the Outlook was at 21.52, also lower than in September but remaining above 20 for the fourth consecutive month.
The overall Outlook is a balance of the Outlook of Millionaires with $1 million in investable assets and non-Millionaire investors with less than $1 million in investable assets.
The overall Outlook fell among all four components for both Millionaires and non-Millionaires. The Outlook for the Economy, the most volatile of the four components, dropped 20 points overall, and dropped 34 points among Millionaires.
Here is a look at the outlook regarding each component:
(2.40), down 20 points from 18.40 in September
- The overall rating for the Economy is in negative territory for the first time since October of 2016, when investors were wondering what life would be like under President Hillary Clinton.
- Among Millionaires, the Outlook for the Economy fell 34 points to -11.72, again the first negative rating since October of 2016. Among non-Millionaires, the Outlook for the Economy fell slightly to 7.38. it is not unheard of that non-Millionaires would rate the Economy higher than Millionaires do, but a difference of 18 points is unique.
- Males, Republicans and working investors were the most negative toward the Economy compared to the way they felt one month ago. But no segment of investors reported an improved Outlook over the Economy.
40.80, a drop of 12 points from 52.80 in September
- In good times, the Outlook for Household Assets is usually the highest rated, and remains so at 40.80. But it did drop 12 points in the month, led by a 21-point drop in the Outlook among Millionaires for Household Assets.
- Among segments, the Outlook for Household Assets fell 17 points among males and 16 points among Democrats.
20.80, a drop of almost 9 points from 29.60 in September
- Investors clearly believe the current trend of economic indicators is going to negatively affect Household Income, and Millionaires reported a 12-point drop in their Outlook on income. The decrease in Outlook among investors was nearly identical between working and retired investors, but was more pronounced among male investors and those who proclaim to be Democrats.
10.80, a drop of more than 9 points from September
- One month earlier, the Outlook for Company Health was at its highest level of the year, but recent concerns over international negotiations related to tariffs and the relation with Saudi Arabia played a role in seeing a decrease in the Outlook in October. The Outlook among working investors fell from 30.00 to 17.61, its lowest mark in that segment since April.
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