Dramatic spike in consumer optimism seen

A precipitous drop in energy prices, the presidential conventions and the government bailouts of Fannie Mae and Freddie Mac have helped consumer confidence rise dramatically this month, marking the second consecutive monthly increase. The RBC Consumer Attitudes and Spending by Households Index, compiled by RBC Capital Markets Corp. of New York, increased 35.4 points to a reading of 69.2. The Expectations Index, which measures consumers' economic outlook, rose 81 points this month to a reading of 76.3. The Current Conditions Index rose to 55.2, up from 36.7 last month. The Investment Index, which measures Americans' attitudes regarding stock and real estate investments, increased to 63.8 last month, compared with 36.1 in August. The Jobs Index, which measures Americans' perception of their job security, rose to 95.5, from 85.8 last month. "It is a startling rebound,” said T.J. Marta, economic and fixed-income strategist for RBC Capital Markets. But despite the boost in confidence, he sees a weakening economy continuing on a downward trajectory. The indexes were compiled from a sample of 1,044 U.S. adults polled Sept. 5-9 by Ipsos-Reid Public Affairs, a Toronto-based research company.