The roller coaster ride continues on Wall Street with the Dow Jones fluctuating up and down, but still close to its record high. The housing woes continue with inventory staying on the market longer and home sales dropping. American attitudes towards their own finances are just as mixed as these leading indicators. When compared to a year ago, two in five (39%) say their household’s financial condition has improved while almost the same number (38%) say it has gotten worse and one-quarter (23%) say it has remained the same.

Regionally, there are some differences in household finances. Those in the West are most likely to think things are going well as 45 percent say things have improved and just three in ten (31%) say things have worsened. They are followed by those in the East and South where four in ten (40%) in each region say their household’s finances have improved and 36 percent each say their finances have gotten worse. The Midwest is the region where things seem to have hit hardest as just three in ten (30%) say their household’s finances have improved while almost half (48%) say their financial conditions have gotten worse compared to last year.

These are some of the results of a Harris Poll of 1,214 adults surveyed online between September 6 and 14, 2007 by Harris Interactive®.

Looking Ahead

When asked to look six months into the future, Americans are somewhat optimistic as almost half (46%) say they expect their household’s financial situation to be better while just one-quarter (26%) say it will be worse and 29 percent believe it will remain the same. Again, there are some regional differences. Half of those in the South (50%) believe their household’s financial situation will be better six months from now while just one in five (21%) believe it will be worse.

There is more agreement over inflation. When asked if they expect prices for things they normally buy to increase, decrease or remain the same six months from now, more than four in five adults (82%) believe prices will increase, while 13 percent say they will remain the same. Just five percent of Americans expect prices to decrease. While more than four out of five of most income groups believe costs will increase, one income group is slightly less likely to think this. Just over three-quarters (78%) of those who have a household income between $35,000 and $49,999 believe costs will increase.

So What?

One thing to note is that this survey was conducted before the Federal Reserve’s most recent interest rate cut. While the markets reacted quite favorably to this cut, we don’t know what the impact was on the American public. Lower interest rates may mean lower finance charges on their credit cards, but their homes are many people’s biggest investments. Will they feel more or less secure? Time will tell.