New Yorkers’ moods collapsed beneath the weight of 1970’s-style stagflation, sending consumer confidence levels to record lows throughout the state, according to a quarterly report by the Siena Research Institute report released this morning.
Wracked by the combination of high inflation and recessionary conditions, the overall confidence of the eight metropolitan areas surveyed during the first quarter tumbled. Sentiment in the Albany area plunged 28.1 points to 62.7, compared to a year earlier. The region had the state’s third highest confidence reading, trailing New York City and Syracuse — those cities both had a confidence index of 63.4.
Reflecting the problems on Wall Street, which peaked last month with the near collapse of investment banking behemoth Bear Stearns, New York City’s sentiment index fell 28.4 points. Syracuse’s confidence dropped 18.8 points.
“Virtually everyone is at a record low,” said SRI Founding Director Douglas Lonnstrom.
SRI started conducting the quarter survey in September 2001, two month’s before the nation exited its last eight-month recession.
Other factors battering consumer moods during the quarter were high energy prices, the prostitution scandal that cost New York a governor who had been elected less than two years ago by a landslide and the worsening housing slump.
But Lonnstrom saw a silver lining in the statistics. First, he noted how consumers’ future buying plans are up slightly. Second, he said the spreads between the metropolitan areas’ confidence readings are narrower, down to four points from 12 a year earlier.
“Everyone is hitting the bottom together, and maybe that’s a sign it’s as low as we can go,” he said.