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For Immediate Release October 4, 2001
Contact: Cristi Allen
callen@decisionanalyst.com
Phone: 817-640-6166

Arlington, Texas – The Decision Analyst U.S. Economic Index for September, based on a nationwide survey conducted the last 10 days of September (i.e., beginning about 10 days after the September 11th attacks), shows that the effects of the tragedy on consumer attitudes relative to the economy to be modest. The U.S. Economic Index fell four points in September, as shown in the graph below. This decrease in the index, however, was relatively small, in our opinion, given the magnitude of the World Trade Center and Pentagon attacks. The disaster did have an immediate impact on the level of business activity reported across the U.S., as consumers’ typical spending patterns were disrupted. Consumers seemed to be in a state of shock for a week to 10 days after the tragedy, but by late September appeared to be returning to a more normal pattern of movement and spending. Consumers’ spending plans for the next six months also diminished, but the size of the decrease was modest. The September Index, in spite of the terrorist attack, was no lower than the month of July, and only slightly lower than the average of the past nine months.

The Decision Analyst U.S. Economic Index peaked in the spring of 2000, declined to a slightly lower level in the fall of 2000, and then dropped dramatically to a lower level during the first nine months of 2001, as shown below.

"While the World Trade Center disaster certainly had negative effects, it also triggered price reductions that will be a positive for the economy. Despite the recent news of major layoffs, the average American remains confident in the security of his/her job, and feels that the labor market continues to be relatively strong. Additional interest rate cuts by the Federal Reserve Board will also be a strong positive factor for economic recovery. We remain optimistic that an economic recovery is close at hand. Without further shocks, we believe that the U.S. economy will begin to recover by the end of the fourth quarter 2001, or no later than the first quarter 2002," said Jerry W. Thomas, President/CEO of Decision Analyst, Inc. "Predicting the future is tricky given the WTC and Pentagon attacks, but the U.S. economy is extremely diversified and robust. We are increasingly confident that the worst of the downturn is behind us," Thomas said.

The Decision Analyst U.S. Economic Index is based on an Internet survey of several thousand households balanced by gender, age and geography. The survey is conducted over the Internet during the last ten days of each month, and the index is immediately calculated from nine different economic measurements, using a sophisticated econometric model. The result is a snapshot of current U.S. economic activity, as seen through the eyes of consumers. Whenever the Decision Analyst Economic Index is greater than 110, it tends to signal an expanding economy. An index in the 100 to 110 range suggests a stagnant economy, and an index below 100 generally indicates economic contraction or recession.

If you would like to be the first to receive the Decision Analyst Economic Index each month, please contact Cristi Allen by email to get on the advanced-release list.

For additional information contact:
Cristi Allen
Publicity
Email: callen@decisionanalyst.com
Phone: 1.800.ANALYSIS (262.5974)
Address: 604 Avenue H East
Arlington, TX 76011

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