The University of Michigan sentiment index has unfortunately softened in early October despite Covid case numbers falling sharply and incomes and wealth rising. Nonetheless consumers are clearly out there spending. {chart} We have to assume it is related to the spike in energy costs given that gasoline prices have increase from a national average of $3.18 a gallon in September to $3.31 today. Remember too that this time last year gasoline was less than $2.20 a gallon so there is certainly a hit to spending power. Meanwhile the surge in natural gas prices has received a lot of media attention given the implication for ... (full story)