U.S. consumer spending held up in the latest retail figures, climbing 0.5 percent in December, despite confidence resting on shaky ground.
By several measures -- including the Conference Board's Confidence Index, which dropped for a second consecutive month in December, and the Gallup research firm's Outlook Index, which plunged in early January just after President Obama signed the new tax law that put an end, for the moment, to worries about the economy dropping off the "fiscal cliff" -- confidence is on the wane.
More recently, Country Financial said a survey involving 3,000 interviews found only 20 percent of U.S. entrepreneurs indicated they believe the economy would return to pre-recession levels.
Optimism was a bit higher among government workers and private company employees, where 34 percent and 30 percent, respectively, indicated they believe the economy would return to the good, old days, which means returning to pre-2007 growth.
There's bare-bones logic behind those figures. Compared to working for a private company, a government paycheck is theoretically one a worker can count on long term -- the equivalent of, say, a government bond versus buying shares in a private firm.
Confidence in retirement has not appeared to have recovered since the recession. More than 25 percent of those with 401(k) retirement accounts have used them for paying current bills, consulting firm HelloWallet reported this week compiling data from the U.S. Federal Reserve's Survey of Consumer Finances and the Census Bureau's Survey of Income and Program Participation.
Since 2008, the number of people taking money out of retirement accounts -- regardless of hefty fees and taxes that must be paid -- has risen 12 percent, data show.
Despite all that, spending is holding up. Just ask Chrysler, where sales rose 20.6 percent in 2012. (Overall, spending on cars rose 13.4 percent last year.)
What else is better? The job market has improved little, if at all, but the housing market and the credit that comes with it, has improved. Exports have increased in recent years. Inflation remains muted with gasoline prices dropping in recent months. But analysts say last year's drought could start to push food prices higher soon.
Add that all up and depleted confidence likely means a drop in spending will follow. If spending holds up, it will be consumers defying gravity again.
In international markets Wednesday, the Nikkei 225 index in Japan lost 2.56 percent, while the Shanghai composite index in China shed 0.7 percent. The Hang Seng index in Hong Kong dropped 0.1 percent, while the Sensex in India gave up 0.85 percent.
The S&P/ASX 200 in Australia gained 0.46 percent.
In midday trading in Europe, the FTSE 100 index in Britain lost 0.54 percent, while the DAX 30 in Germany dropped 0.27 percent. The CAC 40 in France slid 0.14 percent, while the Stoxx Europe 600 fell 0.29 percent.