Two reports came out Tuesday that are prime examples of conflicting opinions and the confusion they can cause the average consumer or investor when it comes to assessing the state of the economy.

One report, the IBD/TIPP economic optimism index (published by Investor’s Business Daily and TechnoMetrica Market Intelligence), dropped to 39.2 in April, the largest drop in consumer confidence measured by the index since it first started keeping track back in February 2001.

The other report, released by the National Association of Realtors, reported that pending sales of existing homes were down 1.9 percent in February, a much larger drop than expected, to the lowest level the index has reported since NAR began keeping track in 2001, according to published reports.

Yet, in the NAR announcement, chief economist Lawrence Yun states his belief that existing home sales will see little change over the next few months before making a notable improvement during the second half of 2008.

“The slip in pending home sales implies we’re not out of the woods yet, though an era of successive deep sales declines appears to be over,” Yun said. “Existing home sales could start to show a sustained increase within a few months, unless there are some additional economic problems or excessive inflationary pressure.”

The problem with all this, from the standpoint of an investor or prospective homebuyer, is that pending home sales, by definition, are not closed sales. They are pending and may yet fall out of escrow. In the present economy, that is a likely possibility that must be considered.

Plus, how many of those pending sales might be short sales trying to avoid foreclosure? Given the time it takes to get a bank to accept a short sale arrangement, and the extended time on the market, plus larger inventories of unsold housing (and let’s not forget about the glut of new housing out there and available as well), what are the chances that ALL these sales are going to go through?

The answer is…who knows? With consumer confidence in the economy waning, plus recent reports about higher unemployment nationwide and the expectation that home prices have not hit bottom yet, these sales may be pending for a long time.

It’s no wonder that many investors these days are holding their tongues and keeping their wallets closed.