Consumer Confidence Up, But So Are Gas Prices
Thursday, March 15, 2007
New economic data shows San Diego consumer confidence went up in January. But rising gas prices could turn that around. KPBS Radio's Andrew Phelps explains.
The latest report from the University of San Diego doesn't factor-in today's high gas prices. Economist Alan Gin has a theory about consumer confidence. He says every 10-cent rise in gas prices takes $7 million out of the local economy.
Gin: People fill up once or twice a week, maybe, and so they can see firsthand these prices going up. And they see money flowing out of their pockets. And that has an impact.
A big impact, by his reckoning. Gas prices are up 50 cents from a year ago. And there is no sign of let-up.
Gin warns of other trouble spots. Housing is the weakest sector of the market. Building permits are down. San Diego's economy is sluggish overall, but Gin says there are no signs of a recession. For KPBS, I'm Andrew Phelps.