When investors are asked to consider how the economic fortunes of the United States impact their personal household fortunes, they respond differently than when they consider the stock market fortunes.
That’s why the Spectrem Household Outlook sometimes falls when market indicators are steady.
The Spectrem Household Outlook, which is designed to measure an investor’s optimism about four financial components in their daily lives, dropped to 10.9 in January 2019, and the Outlook has not been that low since it also reached 10.9 in October of 2016. The Outlook has been below 20 for four consecutive months, and that last happened between the months of March and June 2016.
The drop in the overall Outlook was spurred mainly by decreased Outlook among Millionaires, who reported lower numbers in all four categories of the Outlook, including a decrease by half in the Outlook for Household Income, from 26.19 to 13.18. The Outlook for Millionaires was 10.47, the lowest mark since October of 2016, just before the last Presidential election.
Non-Millionaires recorded an Outlook of 11.36, nearly identical to the month before, and obviously a better Outlook than among Millionaires. That historically rarely happens, but has occurred twice in the last four months.
Here is a look at the outlook regarding each component:
(12.00), up 3.6 points from (15.60) in December.
- The Outlook for the Economy overall has been in negative range for four consecutive months. The last time that happened was November 2012-February 2013. But the number has improved from a month ago, as non-Millionaires improved their Outlook from -15.32 to -8.26. Still, this is a number that historically sits in positive territory, at least for Millionaires.
- All segments of investors either kept their Outlook for the Economy near its December level or improved it, which is a positive sign.
29.20, down four points from 33.20 in December
- The Outlook for Household Assets is always the highest number in the measure, but it has dropped for four consecutive months, form 52.80 in September to 29.20 in January. One must go back to February 2016 to find a lower number for the Outlook for Household Assets.
- However, retired investors and female investors both reported slight improvements on their Outlook for Household Assets over the previous month.
14.40, a drop of more than 10 points from 24.80 in December.
- The floor really fell on the Outlook among investors for Household Income, reaching a number not reached since January of 2016 when a new President was about to be inaugurated. The Outlook for Household Income was halved among Millionaire investors from 26.19 to 13.18, and non-Millionaires reported a dip from 23.39 to 15.70.
- Among working investors, their Outlook for Household Income fell from 34.04 to 21.48.
12.00, a drop of 3.6 points from 15.60 in December.
- This marker actually rose in December due mostly to improved performance for Millionaires. In January, Company Health fell among Millionaires by almost 10 points but rose slightly among non-Millionaires.
- The only segment of investors to report an increased Outlook for Company Health was Republicans, who saw their Outlook rise from 22.73 to 29.89.
©2019 Spectrem Group