America's Latest Economic Ratings Continue to Sink

According to a new Gallup poll released last week, Americans are now rating economic conditions more negatively than at any point over the last 9 years, while their expectations about the immediate future continue to get more negative. Americans also expect unemployment, interest rates, and inflation to get worse in the next six months, although they are surprisingly somewhat positive about overall economic growth and the stock market.

The poll, conducted January 13-16, finds only 22% of Americans rate the economy as excellent or good. Another 50% rate the economy as "only fair," while 28% say "poor." The 22% excellent/good to 28% poor ratio is the worst rating that Gallup has measured since November 1993.

The over-shadowing issue facing nations worldwide is the potential war with Iraq and its resulting impact on the U.S. and global economies. Discussion last week at the Global Economic Summit were dominated by "war talk." We can expect the same in the President's State of the Union address.

According to Dennis Jacobe, the Gallup Organization's Chief Economist, "the world's economic leaders will make a big mistake if they decide to take a wait-and-see approach to the economy during the coming weeks. Instead, they should do everything they can to stimulate economic growth now and hope that any anticipated rally effect will simply add to the economic momentum their efforts create."