Win Won't Loosen Consumers' Grip on Their Wallets

Exclusive Survey: Anxiety over Housing, Job Losses Dampens Hope for Future

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NEW YORK ( -- The American public may have been dancing in the streets following the historic election of Barack Obama, but that doesn't mean the markets will be recovering anytime soon.

A study commissioned by Advertising Age and conducted by Lightspeed Research found that 58% of consumers are satisfied with the outcome of the election and more than half feel more confident in the economy. But while consumers are hopeful about the country's future, they remain pessimistic when it comes to their finances.
Happy: A supporter celebrates in Times Square
Happy: A supporter celebrates in Times Square Credit: Andrew Couldridge
Contradicting findings of a survey last week from the International Council of Shopping Centers, 64% of respondents in the Lightspeed study said they would make no changes to their holiday spending, while just 7% said they would spend more. Less than one-third of respondents said they feel more comfortable with their personal spending overall, while 46% are not more comfortable.

Economic experts said that while consumer confidence may rebound slightly in the wake of the election, any improvements are likely to be temporary.

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In the days after the election, major corporations such as General Motors announced dismal earnings; retailers reported steep declines in October sales and the Labor Department said unemployment rose to 6.5%.

"I trust him to govern with honesty and intelligence and to surround himself with the best financial minds in the country," said one respondent. "The economy has not changed yet, nor will it change by the end of the year. He is a lawyer, not a magician."

"Obama gives me confidence that he will try to change things. ... He's young and can withstand the pressures that will be put on him," said another whose holiday spending also will remain the same. "[But] he's not a miracle worker. The position he will take over needs a lot of help."

Lingering doubts
Still, just under one-third of respondents said they are dissatisfied with Mr. Obama's election, and 27% said they are less confident in the economy.

"The president-elect does not have enough experience to handle the challenge of our deep economic problems, and I feel a catastrophe is waiting around the bend," said one of Mr. Obama's detractors.

Others repeatedly cited Mr. Obama's desire to "spread the wealth," along with his purported socialist leanings and criminal ties. And, yes, some Americans still incorrectly believe he is Muslim.

When it comes to whether Mr. Obama will be able to effect change in the economy, women and people ages 25 to 34 have the highest expectations for the president-elect. Overall, half said he will be better for the economy, while 27% said he will not and 24% said they aren't sure.

"Although I know the bottom is yet to be reached, I feel that a reversal of Bush-onomics can only help the economy," said one supporter. "Large tax cuts for the rich and cuts to entitlement programs for the poor during the past eight years have contributed to the economy's downfall. I see Obama energizing the country from the bottom up. Repealing the tax cuts on the rich and his plan to provide incentives for 'hiring at home' rather than outsourcing overseas will be good starts."

Tumbling Dow
But economic experts caution that Mr. Obama won't be able to have an immediate impact. Indeed, the Dow tumbled 681 points in the three days following his election. The day after the election, it fell 486 points, or 5%, the worst percentage loss ever the day after a presidential election. Several respondents pointed to that as an immediate referendum on Mr. Obama.

"He is so much of an unknown entity that no one knows which direction he might try to take the country," said one respondent. "If he instilled any confidence at all, the Dow would not have dropped so far."

The study, conducted online, included 502 consumers; 83% voted in the election, 57% voted for the president-elect and 12% were voting in their first presidential election.
Source: Lightspeed Research
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