Great Expectations and the Consumer Confidence Con Game

Floyd Norris has an interesting discussion of the Conference Board's consumer confidence index in his "Off the Charts" column. The main takeaway is that the current conditions index has been on a consistent upward path since the trough of the recession while six-month expectations index has gyrated erratically with little clear trend.

It is worth adding a bit more to this analysis. The current conditions index does actually tend to track current consumption reasonably closely. On the other ha...