this Michigan consumer confidence survey's correlations with unemployment rate, inflation diverge, like (to a lesser extent) The Conference Board’s confidence survey. Interestingly, they all deviated from sentiment measured through text analysis.
figure 1: University of Michigan consumer confidence (blue), Conference Board consumer confidence (tan) and Shapiro, Sudhoff, and Wilson (2020) Daily news sentiment index (green), both deflated and normalized by standard deviation (for the sample period shown). The December observations in Michigan are preliminary. NBER-defined recession peak-to-trough dates appear gray. Source: U.Mich (from FRED), The Conference Board (from Investing.com), SF FedNBER, and author's calculations.
To the extent that there are differences between survey-based and news text-based series, this provides some support for the following: resonance view The gloomy mood of the masses (conditional on the daily news index accurately summarizing the news).
