ECONOMIC DESPAIR – AT 10:06 A.M. ET:  A new Gallup survey shows the extent of economic despair in the United States, something that simply has to impact a presidential election that is barely three months away.

WASHINGTON, D.C. -- Americans' confidence in the economy declined last week to -29, matching levels not seen since early January. The decline may be due to the estimate of slower-than-hoped second quarter GDP growth. Confidence had peaked at -16 in late May after a series of encouraging jobs reports, but when subsequent reports were less positive, Americans' confidence headed in the opposite direction. Still, confidence is higher now than it was in the latter part of 2011.

The Gallup Economic Confidence Index is an average of two components of consumers' psychology: Americans' ratings of current economic conditions and their perceptions of whether the economy is getting better or getting worse. The economic outlook component of the index accounted for the overall change in economic confidence, declining seven percentage points to -29 over the past week. Sixty-two percent of Americans now say the economy is getting worse, while 33% say it is getting better. Americans' perceptions of current economic conditions are unchanged at -28, with 14% saying conditions are excellent or good and 42% saying poor.

For most of the year, Americans have been less negative about the economy's direction than about current conditions, but now the two are rated similarly.

COMMENT:  The administration has only three months to make economic progress.  It's highly unlikely that they can create a miracle, although The New York Times might declare one just in time for the election.  We will have more economic numbers later this week, but conditions clearly do not look good.

However, FDR didn't get us out of the Depression in his first term, and faced very grim economic numbers when he ran for re-election in 1936.  Still, he won in a landslide.  People just had more confidence in him than in his opponent, Governor Alf Landon of Kansas. 

Romney has to win this election.  He can't depend on Obama to lose it.

July 31, 2012