To say CEOs are a confident lot seems like mastery of the obvious. A strong sense of confidence is a prerequisite of the job. During times of expansion, every good CEO will tell you their company can out-compete its competitors. And when times are bad, they will insist they should still do better.
But there also seems to be a constant sense of apprehension affecting the person who is ultimately in charge. As Shakespeare says in Henry IV, Part II, "Uneasy lies the head that wears a crown." I know CEOs are not kings, but I bet many of them wish they were so they could decree an end to the issues causing them so much uncertainty at the present time.
From my perspective, these two opposing forces are what make a CEOs' job always interesting. And recently, I am particularly interested in CEO's confidence levels.
Each month, Chief Executive magazine surveys its database of CEOs in the U.S. across a wide variety of companies. Using a scale of 1-10, these executives are asked to rate their confidence levels in both the current and future business conditions. The data from this survey is broken down into subcategories, which include CEOs for manufacturers of industrial goods and manufacturers of consumer goods. It does not specifically report data from plastics industry CEOs, but I would be surprised if we are not represented in both these manufacturing categories.
The latest survey indicates CEO confidence in future business conditions fell 6 percent in August from July. At 6.2 out of 10 for the month, confidence in business conditions one year from now is at its lowest level since October 2016, which was the last time CEOs reported their outlook as "weak."
The chart of the recent trend in this data series is more illustrative than a point from a single month. During the first half of 2019, the trend was flat-to-up and it looked like confidence levels were recovering from the abrupt decline in December 2018. Last December, you will recall, the Fed hiked interest rates a quarter of a point and the stock market promptly plunged more than 15 percent. Those few weeks tested everybody's confidence levels, so I understand why the survey showed a dip in December.