Consumer confidence, as expected, soared in May with a record big 14 point increase to 54.9 according to The Conference Board. This does not signal that the recession is over. Rather, it signals that consumers have a new attitude about it. They no longer believe Presidents Obama’s threat that the recession could be open-ended if he did not get his way in Congress. Now consumers’ believe that the recession is winding down in the next few months; the sub-index for personal financial situations six months ahead is far above the reading for current financial situations. With the usual short lag, the construction spending decline will also wind down later this year.

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