ECONOMY FULL OF JOLLY SURPRISES NEWLY RELEASED REPORTS SURPASS LOW EXPECTATIONS.

Byline: Brent Hopkins Staff Writer

At a time of year when a little good news goes a very long way, things are looking up on the economic front.

According to a series of reports released Tuesday, consumers' optimism is at its highest level since August, orders for pricey durable goods are up, and home sales made their biggest one-month gain in more than 12 years.

While the economy hasn't completely escaped the slow-simmering malaise of the past few years, shoppers are feeling good as they plunge into their holiday buying.

``It's a little bit ... easier on the pockets since I'm getting paid a lot more,'' said James Blake of Los Angeles, shopping at the Glendale Galleria. ``I don't have to think about it as much.''

Last year, the 19-year-old was waiting tables, but now he's working in a tax office. He had his eye on clothes, electronics and gaming systems. He said he is shopping online as well as at the mall.

As he forked out cash on gifts for his relatives, his optimistic mood mirrored that of the nation. The Conference Board, a nonprofit organization that tracks shopper sentiment, said Tuesday that its consumer-confidence index had risen to 98.9 in November, sharply above what analysts expected.

That, combined with a 55-cent drop in gasoline prices since they hit a record high in September of $2.999 in Los Angeles after Hurricane Katrina, makes shoppers such as Ana Solares increasingly likely to spend on holiday gifts.

The 35-year-old Westlake Village resident economizes all year and clips coupons to purchase gifts for her three children.

``I end up saving about $2,000,'' she said, grabbing a bit of rest at the Simi Valley Town Center. ``And I still go over budget.''

Folks like her pushed same-store sales up 5.1 percent last week over the same period a year earlier, according to numbers released Tuesday by the International Council of Shopping Centers.

Though that's inflated by unusually long hours for Black Friday shopping, it still represents the strongest increase since June 2004.

``We saw in the last couple months that consumers perceived inflation becoming a problem, but it's come back a lot,'' said Mike Niemira, the trade group's chief economist. ``We're not out of the woods, but we're in the sweet spot between the drop in gasoline prices and the next home-heating bills.''

That's not to say all the news is good. Even with eight weeks of declines at the pump, at the $2.448 the Automobile Club of Southern California says motorists are paying in Los Angeles, a gallon of regular is still more than 17 cents costlier than a gallon was a year ago.

Household heating bills - whether for natural gas or, on the East Coast, heating oil - are also expected to leap upward.

And though unemployment is relatively steady at 5 percent, there's also gloomy news, such as General Motors layoffs on the horizon and Delta Airlines bankruptcy battles.

Still, consumers want to buy, and retailers are more than happy to accommodate them with discounts, cheap financing and delayed-payment plans.

``We still see a great deal of the wealth effect taking place,'' said Aubie Goldenberg, a partner in Ernst & Young's Los Angeles retail group. ``People still want to feel good about the way they're living, so they're still buying. Maybe they're treating themselves above their means.''

Becky Wray of Northridge, with a bag on each arm at the Northridge Fashion Center, conceded she overspends but said that's an annual occurrence.

``I tend to spend too much every year,'' the 56-year-old Wray said. ``I figure I'm going to buy a certain number of things for each person, and when I'm done, I'm done.''

Staff Writers Alex Dobuzinskis, Lisa M. Sodders and Angie Valencia- Martinez contributed to this story.

Brent Hopkins, [phone]

brent.hopkins(at)dailynews.com

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SOURCE: The Conference Board