By Gregory Heym, BHS Chief Economist and and host of Crossing The Line
This week, we expose how fickle consumers can be, present the latest on pending home sales, and tell you something unbelievable about President John Tyler.
What a Difference a Fortnight Makes
Hope you got the Dinah Washington reference, and sorry to my son that this is not about the video game Fortnite.
Two weeks ago, The University of Michigan reported that their index of consumer sentiment fell to its second-lowest level on record in April. The main driver for consumer pessimism last month was tariffs, especially the ones between the U.S. and China.
This caused a lot of concern in the financial markets, especially since consumer spending accounts for roughly 70% of GDP. But as I’ve mentioned before, consumer sentiment is what us economists call “soft data”, which means it’s qualitative data that is very hard to measure. Since it’s driven by feelings and opinions, soft data can change very quickly.
Fast forward to this week, when the Conference Board released their consumer confidence index. That figure came in much higher than expected. What was the difference? The data released two weeks ago was collected before the 90-day pause on most tariffs between the U.S. and China, while this week’s data was collected after that announcement.
The bottom line is that while the media loves to run stories about consumers and their feelings, feelings can change very quickly. That’s why I think it’s best to stick to hard data like employment, consumer spending, and inflation.
Pending Home Sales Fell 6.3% in April
Pending home sales—which are based on when contracts are signed—fell 6.3% last month. Economists were expecting just a 1.0% decline, so this data was much worse than expected.
Despite a sharp rise in inventory over the past year, home prices have remained elevated. Add higher mortgage rates and economic uncertainty to that equation, and you can see why contract activity was so weak in April. In fact, it was the largest decline in pending home sales in almost three years.
One More Thing
Harrison Ruffin Tyler died this week at the age of 96 years old. What’s most noteworthy about Mr. Tyler is that he was the last living grandson of President John Tyler. For those who may have forgotten their history, John Tyler was the 10th president of the United States from 1841-1845.
How did a man born in 1790 and president before Abraham Lincoln have a living grandchild in 2025? Both President Tyler and his son Lyon—who was his 13th child and Harrison’s dad—remarried much younger women and had children with them. Lyon was born when President Tyler was 63 years old, and Harrison Ruffin Tyler was born when Lyon was 75. Add in the fact that Harrison lived to be 96, and this starts to make a lot more sense.
Our condolences to the Tyler family for their loss.
