Many people are wondering what yesterday's miserable consumer confidence report says about the future. As consumer confidence tanks, the thinking goes, so do our chances of an economic recovery.

February's consumer confidence reading -- from a monthly phone survey asking folks how they're doing -- fell off a cliff compared with January. Here's how we've done over the past year:

Month

Consumer Confidence

February 2010

46.04

January 2010

56.45

December 2009

53.62

November 2009

50.64

October 2009

48.67

September 2009

53.43

August 2009

54.48

July 2009

47.37

June 2009

49.32

May 2009

54.81

April 2009

40.81

March 2009

26.90

February 2009

25.30

Source: Capital IQ, a division of Standard & Poor's.

Ugly stuff. Consumer confidence is now at the lowest point since last April, when rational people were mumbling about a depression and Citigroup (NYSE: C) and Bank of America (NYSE: BAC) traded like death was imminent.

What happened? To make sense of these numbers, let's pick apart a few questions the survey's respondents were asked:

Question

Percent Agreeing, February

Percent Agreeing, January

Is the economy good?

6.2%

8.5%

Is the economy bad?

46.3%

44.7%

Are jobs hard to get?

47.7%

46.5%

Are jobs plentiful?

3.6%

4.4%

Will there be more jobs six months from now?

13.4%

15.8%

Will there be fewer jobs six months from now?

24.6%

18.9%

Source: Conference Board.

That's a serious shift in just one month. In the eyes of the dear U.S. consumer, the economy's a wreck, jobs are evaporating, and it's only getting worse. Now you know why consumer-sensitive stocks like Visa (NYSE: V) and Best Buy (NYSE: BBY) fell the moment this report came out.

But before you resume building your bunker, know this: As important as the consumer confidence report is, it doesn't predict much. In fact, it's almost always contrarian. It's what economist nerds call a "coincident indicator" -- it tells us what just happened, not what's likely to happen in the future.

Consider what seems to be the biggest manipulator of consumer confidence, the stock market. Going back several recessions, consumer confidence consistently tops out within a few months of the stock market, and bottoms near stocks' nadir as well. This isn't surprising, since stock gyrations alone are what most people use to gauge the economy. Most people don't extrapolate labor productivity gains or GDP contractions; they watch Jim Cramer. But that consumer confidence simply piggybacks whatever route stocks took in recent months certainly calls its usefulness into question.

So is yesterday's report an ominous sign for recovery? Not really. It's likely just a reminder that stocks fell over the past few weeks.

If you want a good predictive economic indicator, keep an eye on monthly jobless claims and residential real estate investment. These are two metrics that, once they start turning, future growth and stability are in the cards.

Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. Best Buy is a Motley Fool Inside Value selection and a Motley Fool Stock Advisor recommendation. The Fool owns shares of Best Buy, and has a disclosure policy.