The March Consumer Confidence Index makes for grim reading for those Bernanke cheerleaders who still think that Ben and the Fed can keep the economy from experiencing a recession. A recession that we are probably already in. Actually, it makes grim reading for anyone who is concerned about the future path of the American economy.

The Conference Board Consumer Confidence Index, as reported by the Confidence Board, which had declined sharply in February, fell further in March. The fall was all of 12 points which is like falling over a cliff.

The Index now stands at 64.5 (1985=100), down sharply from 76.4 in February. The Expectations Index declined to 47.9 from 58.0. The Present Situation Index decreased to 89.2 from 104.0 in February.

For more of this story go to The Consumer Confidence Board website.

Investors of America and the world it surely looks like we are entering into an economic mess that will be extremely severe and difficult to get out of. When the American consumer stops buying all that stuff that they don’t need with money they don’t have our roughly 70% based consumer economy has got to be in trouble.

Perhaps an economy based on savings and investment rather than consumer spending would serve us a lot better. Unfortunately the American government policies favors spending and consumption over saving and investment. Even members of the Federal Reserve Bank and the President encourage citizens to go out and buy a new gas guzzling new SUV rather than save.

Then the rate cutting mania of the Federal Reserve punishes those thrifty citizens who do save. Rate cuts to extremely low levels especially hurt retired people who depend upon savings account interest to help fund their living expenses.

The American economy has been build on a foundation of sand. At some point, one we may have reached, a consumption driven economy is doomed to fail.

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