Underconfident

Consumer confidence fell to an all-time low as worries about jobs, energy bills and home foreclosures darkened people's feelings about the country's economic health and their own financial well-being.

According to the RBC Cash Index, confidence tumbled to a mark of 56.3 in early January. That compares with a reading of 65.9 in December — and a benchmark of 100 — and was the worst since the index began in 2002.

"People are anxious because everything sounds pretty awful these days," said Bill Cheney, chief economist at John Hancock Financial Services Group.

Economists cited several factors for consumers' gloomy outlook:

_Hiring practically stalled in December, pushing the unemployment rate to 5 percent, a two-year high, the government reported last week.

_The meltdown in the housing market has dragged down home values and made people feel less wealthy.

_Harder-to-get credit has made it difficult for some to make big-ticket purchases.

_High energy prices are squeezing wallets and pocketbooks.

_There has been much hand-wringing on Wall Street and Main Street as to whether all these problems will plunge the country into recession.

"Consumers are gloomy. The confidence reading suggests that people believe bad times are upon us," said Richard Yamarone, economist at Argus Research.

Over the past year, consumer confidence has eroded sharply as housing and credit woes took their toll. Last January, confidence stood at a solid 95.3. The index is based on the results of the international polling firm Ipsos.

The White House is exploring a rescue plan, possibly including a tax cut, to aid the ailing economy. Federal Reserve Chairman Ben Bernanke, criticized for not doing enough, pledged on Thursday to keep lowering interest rates. They are expected to drop by as much as one-half of a percentage point when central bank policymakers meet later this month.

The public is giving President Bush low marks for his economic stewardship. His approval rating on the economy dipped slightly to 33 percent in January, from 36 percent in December, according to a separate Associated Press-Ipsos poll. His overall job-approval rating was 34 percent, compared with 36 percent last month.

Individuals' sentiments about the economy and their own financial fortunes over the next six months actually fell into negative territory in early January. This gauge came in at a negative 8.2 percent. That was the weakest showing since right after the Gulf Coast hurricanes in August 2005.

Another measure looking at current economic conditions dropped to 78.9 in January. That was the lowest reading since early March 2003, when U.S. troops invaded Iraq.

Oil prices recently surged past $100 a barrel, though the price has moderated somewhat. Gasoline has topped $3 a gallon. Those high energy costs for fueling cars and heating homes are leaving people with less money to spend elsewhere, analysts say. In turn, prices for some other goods and services have risen.

Economists keep close tabs on confidence barometers for clues about people's willingness to spend.

A gauge of attitudes about investing, including comfort in making major purchases, dipped to 76.3 in January. That was the lowest since May 2005.

The housing slump, weaker home values, harder-to-get credit and high energy prices all "seem likely to weigh on consumer spending as we move into 2008," Bernanke said Thursday.

Many economists believe upcoming reports will show the economy grew at a feeble pace of just 1.5 percent or less in the final three months of last year and will be weak in the first three months of this year. Major retailers reported weak sales for December.

Another index tracking consumers' feelings about employment conditions fell to 106.9 in January, a two-year low.

Government and private employers last month added the fewest new jobs to their payrolls in more than four years. In fact, employment at private companies alone actually declined. The jobless rate climbed to 5 percent in December, from 4.7 percent. The Labor Department's report, issued last week, stoked fears about a recession.

The RBC consumer confidence index was based on responses from 1,027 adults surveyed Monday through Wednesday about their attitudes on personal finance and the economy. The survey was taken after the employment report but before Bernanke's comments Thursday signaling additional rate cuts. Results of the survey had a margin of sampling error of plus or minus 3 percentage points.

The overall confidence index is benchmarked to a reading of 100 in January 2002, when Ipsos started the survey.