Consumer sentiment fell to its lowest level in two years in November, according to the Reuters/University of Michigan Surveys of Consumers.

The figure was 76.1, above the 75 expected by economists but below October's 80.9 level, according to a Reuters report. What a shock.

This holiday season, many consumers aren't feeling that thankful for the worst housing market in 16 years -- according to the National Association of Realtors, housing prices fell in one-third of U.S. cities. Gas prices reaching $4 per gallon is further spooking people already nervous about the volatile stock market and the weak dollar. Oh, let's not forget about the prospect of $100 oil.

"We're facing extreme price increases in energy, and it's clear the consumer is becoming more aware of the pressures being put on them,'' Lindsey Piegza, an analyst at FTN Financial, told Bloomberg News. "I don't expect a collapse in spending, but it will be very weak for the holidays.''

Economists surveyed by Bloomberg are expecting consumer spending to grow at a 2% pace in the final three months of the year, after rising 3% in the third quarter. Shares of Wal-Mart Stores (NYSE: WMT), Target (NYSE: TGT) and Kohls (NYSE: KSS), along with the continuing weakness of the financial stocks and airlines pushed the S&P 500 Index into negative territory for the year.

To be sure, there are some bright spots.

As Reuters notes, the number of U.S. workers applying for jobless benefits fell by 11,000 last week, which was in-line with expectations. Meanwhile, first-time claims for unemployment benefits fell in the week ended Nov. 17 to a seasonally adjusted 330,000 from an upwardly revised 341,000 the prior week, the news service says.

But for now, many people see the glass as half-empty rather than half-full. As one CNBC pundit put it: "fear is kicking our butt."

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