Consumer confidence and regime change (updated)

Calculated Risk put last month’s consumer confidence print into historical context in the chart below. Look at the other times it reached or approached this level (roughly mid-60s or below) – every one of them coincided with a change in political party in the White House. The only exceptions are 1982, which was not a Presidential election year but was the real start of Reaganomics, and 2000, where the election was not determined by voters.

I’m no political scientist and this is hardly earth-shattering insight, but I was surprised to see the strength of the pattern.

UPDATE 8/14: I thought it might be interesting to look further back in the data, but unfortunately this particular series only seems to go back to the mid-1950s. Nonetheless, the chart (via FRED) is interesting:


The R to D regime change with Carter’s election in 1976 is clearly foreshadowed here, as is Nixon’s re-election in 1972 (McGovern’s abandonment by his own party aside).

I’d be the last to point to this as hard and fast evidence of a causal relationship, since consumer confidence and politics both drive and are endogenous to the swirl of media-driven culture, but it’s an interesting relationship nonetheless.

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