Perky Economy Starts to Relieve Worker Angst

Maybe the U.S. economy added 111,000 jobs last month, but maybe it didn't. Given that the Labor Department later revised higher its monthly jobs numbers 75 percent of the time last year, there's a good chance the final number for January will be somewhere north of 111,000. (More than one economist has called these preliminary payroll numbers "useless.")

I'm really more interested in what's been happening with consumer confidence. While there's been plenty of talk about growing income inequality and worker angst–often by me–Americans have been getting more optimistic. Here are the key takeaways from today's University of Michigan consumer confidence survey, via the good folks at Global Insight:

1) The survey catapulted to a two-year high of 96.9 in January, up from 91.7 in December.

2) Sentiment for current economic conditions scaled up by 3.2 points to 111.3.

3) The bellwether expectations index exploded upward by 6.4 points to 87.6.

None of this should really be too surprising, with the economy climbing at a 3.4 percent clip last year (including 3.5 percent in the fourth quarter), jobs growing by nearly 200,000 a month, wages increasing more than 4 percent, and real disposable personal income rising more than twice as fast as in 2005. Even better, the Federal Reserve looks as if it's stuck on pause in fiddling with interest rates. In a conference call today, Bruce Kasman, the chief economist at JPMorgan Chase, described the current climate as "Goldilocks walking in." Remember, income inequality supposedly surged in the late 1990s, but you didn't hear much about it then because everyone's wages and incomes were growing, as was the broader economy.