March 25 (Bloomberg) -- U.S. consumer confidence fell more than forecast in March as Americans' outlook on the economy dropped to the lowest level since Richard Nixon was in the White House.

The Conference Board's confidence index fell to 64.5, a five-year low, from a revised 76.4 in February, the New York- based research group said today. A separate report showed home prices in January fell by the most on record.

Declining stock and property values have unnerved Americans, heightening concern spending will falter. Without consumers, which account for more than two-thirds of the economy, the slowdown triggered by the collapse in housing and credit markets is likely to deepen in coming months.

``It's a discouraging environment,'' Pierre Ellis, a senior economist at Decision Economics Inc. in New York, said in a Bloomberg Television interview. ``We are almost certainly in a recession. The question is how deep and how long it will be.''

The Conference Board's gauge of expectations for the next six months slumped to 47.9, the lowest since December 1973, when the Watergate scandal rocked the Nixon administration and an embargo by a group of Arab oil exporters was in effect, the report showed.

Stock prices extended declines following the report and Treasury securities maintained gains. The Standard & Poor's 500 index was down 0.4 percent at 1,344.6 at 10:32 a.m. in New York. The yield on the 10-year note fell to 3.49 percent from 3.56 percent late yesterday.

Forecasts

Economists forecast the Conference Board's main measure would fall to 73.5 from a previously reported 75, according to the median of 61 forecasts in a Bloomberg News survey. Estimates ranged from 65 to 76.

Home prices in 20 U.S. metropolitan areas fell in January by the most on record, a sign the housing recession is deepening, a private survey also showed today. The S&P/Case- Shiller home-price index dropped 10.7 percent from January 2007, after a 9 percent decrease in December. The gauge has fallen for 13 consecutive months.

The measure of present conditions declined to 89.2 in March from 104 the prior month.

The share of consumers who said jobs are plentiful dropped to 18.8 percent from 21.5 percent last month. Those saying jobs are hard to get increased to 25.1 percent from 23.4 percent.

Lowest Ever

The proportion of people who expect their incomes to rise over the next six months fell to 14.9 percent, the lowest since record keeping began in 1967, from 18 percent. The share expecting more jobs dropped to 7.7 percent from 8.9 percent.

Federal Reserve policy makers have lowered the benchmark interest rates and pumped money into the banking system to try to make it cheaper and easier for Americans to borrow and spend.

The central bank earlier this month carried out its first emergency weekend action in almost three decades and became the lender of last resort to the biggest dealers in government bonds. Two days later, it reduced the target interest rate by three-quarters of a point and acknowledged risks had increased.

``Growth in consumer spending has slowed and labor markets have softened,'' the Fed said after it cut the key rate to 2.25 percent. ``The outlook for economic activity has weakened further.''

`Serious Medicine'

The cuts ``are definitely serious medicine for the economy which is very sick,'' Michael Jackson, chief executive officer of AutoNation Inc., the largest publicly traded U.S. car dealer, said in a March 19 interview with Bloomberg Television. ``The consumer is under extreme stress.''

The number of Americans collecting jobless benefits swelled this month to the highest in more than three years as automakers, construction companies and financial firms fired workers. The economy lost 63,000 jobs in February, the most in five years, according to figures from the Labor Department.

More homes are also being foreclosed as the drop in values leaves owners owing more than a property is worth.

For those still in their homes, falling prices lead to a loss of wealth that makes Americans less inclined or able to borrow to finance spending.

What's more, regular gasoline rose to a record $3.28 a gallon on average last week and crude oil reached a record above $111 a barrel.

Spending is already taking a hit. Retail sales fell 0.6 percent in February, the Commerce Department reported this month, the second decline in three months.

Consumer spending may grow at an annual rate of 0.5 percent this quarter, the slowest pace since the 1991 recession, according to the median estimate of economists surveyed this month by Bloomberg News.

More and more economists are forecasting a recession. Martin Feldstein, the Harvard economics professor who heads the research group that determines when downturns begin, said this month that a contraction had already begun.

To contact the reporter on this story: Bob Willis in Washington at bwillis@bloomberg.net

Last Updated: March 25, 2008 10:33 EDT