June 10, 2008

According to the most recent Consumer Price Index (CPI), when it comes to energy costs there isn't all that much to worry about. Actually, the government's April release showed a drop in energy costs.

But ChangeWave's May consumer survey paints a far different picture - with two-in three consumers (67%) saying their discretionary spending will be lower for the next 90-days because of increased energy costs.

That figure is 3-points higher than our previous survey, and a full 19-pts higher than when we asked the same question a year ago (June 2007).

Want to see even more pain? The number of respondents cutting discretionary spending catapults to 87% among households earning less than $50,000 per year.

You don't have to be a Harvard grad to see there's a massive disconnect between the world the CPI is measuring and the world of the average American consumer. However, as you read this the Phoenix Mars Lander is sampling the Martian soil. Is it possible they're also taking samples for the CPI?