Discouraging Signals

Follow the optimism index each week to guage the outlook for economic growth, jobs, real estate, and the stock market.

The Meter clocked in at 49 on Jan. 12, down from 52 one week earlier, as attitudes became decidedly less cheery. The share of individuals who think that equity markets and home prices will rise over the next year dropped over the past week, and more believe that the unemployed will continue to struggle to find new jobs. Each of the charts that follow measures one of the four different components of the Optimism Meter: economic growth, jobs, equity markets, and real estate. Like the Optimism Meter, the components appear on a scale of 0 to 100, with 100 representing the highest level of optimism. ECONOMIC GROWTH: EXPANDING AGAIN, BUT AT A SLOWER RATE

HIGHLIGHT: Bloomberg’s survey of 57 economists estimates that U.S. gross domestic product will expand by 2.6% in 2010 and 2.9% in 2011. Only 24% of respondents said they think the economy is getting better, down from 30% two weeks earlier. JOBS:GLOOMY FORECAST

HIGHLIGHT: Fifty percent of individuals say that if they lost their job, it would be very hard to find a new one that paid as much. That’s up from 46% one week earlier. Economists predict that unemployment will average 9.2% in 2011, down from an average 10% in 2010. EQUITY MARKETS: NOT MANY EXPECTING GAINS IN 2010

HIGHLIGHT: Investors expect the Standard & Poor’s 500-stock index to be less volatile over the next 30 days, though 47% of individuals aren’t planning on seeing any gains over the next 12 months. REAL ESTATE: SEEKING A BOTTOM

Only 28% of YouGov survey respondents said that they believed their homes would increase in value over the next year. About a quarter (26%) think real estate has yet to hit a bottom.