Housing is more expensive, food is more expensive, childcare is more expensive. Long term retirement plans for the younger generations look abysmal.
The average American doesn’t care how the investor classes stocks are doing and rightly understands that the parasites in the investor class are growing their wealth by siphoning it from the labor of the masses.
Uncanny “let them eat cake” vibes from this article.
Massive unemployment would be substantially worse. Yes there are significant issues with today's economy, but sentiment seems to think it's comparable to depressions in the past. It's not even close.
I don’t think people are comparing it to depressions in the past considering most young adults weren’t even born back then. People are just noticing the disparity in wealth, especially with social media making it much more easy to flaunt and see people flaunting their wealth.
Before actually taking a look on Instagram, I didn’t even know it was possible to live the lavish lifestyles on there. Even more surprisingly, it was of people I knew in real life; vacationing on yachts and all across different luxurious parts of Europe while being students of the same University. A forbidden thought: “what do their parents do? If only I could live like that” but I just forget about it and resume boiling plain rice and lettuce with no sauce.
A significant number of people believe we're currently in a recession and that unemployment is at a 50 year high (in fact, it's a 50-year low). That's likely due to significant propagandizing on outlets like Fox News, Newsmax, OAN, etc.
But, to be fair, economic gains have been vastly disproportionately going to the wealthy, and despite recent (as in the last year) inflation being low, prices in the last 5-10 years have skyrocketed, so it's pretty easy to get the impression that inflation is still high. That's especially true when wage growth only recently started outpacing inflation.
If it doesn't feel like a good time to most people, then it isn't a good time.
No one cares, or no one should care, about "the economy", some abstract bogeyman that the MSM is always going on about.
They should be caring about the wellbeing of median and modal households.
GDP was only ever intended by Kaldor to be a measure of general wellbeing, highly imperfect but the best available at the time. Now, it's a target, and we all know how that goes.
That’s because the “employment” data isn’t measuring “can a person easily get a good job.” It’s so cooked at this point it has as much to do with real jobs as the CPI does with real spending power.
It's never been easy to get a good job unless you have an in demand skill.
It's also likely the best time in history to get a mediocre job. $18 per hour for working retail isn't fabulous but it's easier to get now than it has ever been.
> It's never been easy to get a good job unless you have an in demand skill.
Not to put too fine a point on it, you sound very young. Rest assured that your handful of decades doesn’t suffice for a negative proof and furthermore plenty of counter examples are in living memory.
Sorry. Pumped gas for $4/hr in the 80's. Back then while you didn't have to be highly skilled to get a job like that there were always several applicants for such jobs.
I've been through several depressions and know that while it isn't the best time economically, it's far from the worst.
In 1980 a house that is considerably north of 250k today was 25k. And this isn’t guesswork, I’m talking about real actual houses in the same place. If anything I’m being conservative. So in terms of home ownership that $4 was at a minimum $40 today. Are there gas stations offering jobs pumping gas at $40-50 today? And if so are they at economically marginal scale? No? Yeah I didn’t think so. But I do appreciate your corroborating my point, even if it was through boomer solipsism rather than the ignorance of youth.
1989, not 1980. Bread cost $1 a loaf then, it's $2 a loaf now. Rent was $600 a month then, its $2000 a month now. $18 buys a lot more today then $4 did then.
"Something seems off with the Guardian-Harris finding that half of Americans think the stock market is in decline. In a different survey, Gallup found that 62% of Americans own stocks, mostly through retirement and investing accounts. If that's true, wouldn't most or all of those people know their portfolios are gaining value?"
The article only suggests that stock market performance is related to typical portfolios.
It does suggest that when many indicators are positive, the economy is indeed developing positively. But not the stock market alone. You're beating a straw man.
Arnt, it's ironic that you accuse me of beating a straw man when you're the one misrepresenting my point. I never claimed the article presents stock performance as the sole economic indicator, yet you've constructed this false narrative to undermine. That's the very definition of a straw man fallacy. Moreover, your equating stock market gains with broad economic prosperity for the average American is a textbook example of the fallacy of composition. You're assuming that what's true for a part (the stock market) must be true for the whole (the overall economy).
I'm not suggesting the article presents stock performance as the sole economic indicator. Rather, I'm emphasizing that for the majority of Americans, the stock market doesn't accurately reflect their personal economic realities, even if other indicators are positive.
The idea that the stock market and the economy are not the same thing is not new or controversial. Equities index levels tell us about the changing expectations of future profits (and reflexively expectations on central bank rates), not about the condition of the overall economy. I.e. there is a fundamental disconnect between financial markets and the real economy. Simply put, the causal relationship between the stock market (forward looking) and the real economy is tenuous at best.
Let's look at the data. The Federal Reserve reports that the wealthiest 10% of American households own about 88% of all stocks, leaving just 12% for the rest of the population [1]. So while the S&P 500 may be up an impressive 13% year-to-date, the benefits are disproportionately concentrated among a small, affluent segment of society.
You make a big deal about the contradiction between stock ownership and market perception surveys. But that just proves what I'm saying! If ~62% of people supposedly own stocks, but half think the market is down, then obviously those stock gains aren't making a real difference in their lives.
This disconnect likely stems from the fact that for many households, their stock holdings are relatively modest. The median family might have around $40,000 invested in stocks. A 13% ytd increase in their portfolio value (assuming indexed to S&P500 for 2024) would equate to a $5,200 gain. While certainly welcome, this incremental growth can easily be overshadowed by broader economic pressures like inflation or slow wage growth.
The article does acknowledge positive indicators like GDP growth and job creation. However, it also recognizes the ongoing challenges many Americans face, such as high prices and the expiration of stimulus support. In the context of these everyday financial realities, stock market performance often feels disconnected from the typical household's economic health.
The fact remains, for the vast majority of Americans, stock market fluctuations have limited bearing on their economic well-being.
Isn't inflation measure by comparing a set of product prices (including petrol and food, https://usafacts.org/articles/what-is-inflation-and-how-is-i...)? And the inflation graph in the article shows that inflation is down to about 3%, from a high of 9% in 2022. I know it's compounding but 50% seems a lot.
Inflation is the first derivative of prices (when that is positive, when it's negative it's deflation). So as long as inflation remains positive, prices will never drop. Current economic theory maintains that the first derivative of prices must never become negative (no deflation), since that encourages saving money and slows the economy resulting in more deflation.
Bought a house in Spain for 360k which was purchased two years before for 240k.
Spain doesn't have a very fast-moving real estate market lime in the US so that change was quite special.
So the inflation of homes in Spain could be 50% or more.
The government lies by taking items out of the "basket", like coffee last week, and adding in cheapening items such as TVs, as though you're gonna buy a new 4K TV when your grocery bill has skyrocketed.
Claiming the economy is up 3% is such a small number compared to the massive inflation we had. Inflation is hard to measure and frankly 3% over a 50%-100% inflation seem easily an approximation mistake.
Governments constantly try to underplay a recession/inflation because if people knows there is recession/high inflation the thing spirals even in a deeper recession/high inflation.
I believe we lost a lot of purchase power. I don't blame a specific Administration or someone richer.
Simply we printed a ton of money as economic stimulus during covid to balance the fact that we kept people at home.
I'm not saying it was a bad choice either. But simply now we are paying the price of saving millions of lives from covid and fighting Ukrainian invasion.
They were worth it but there is a cost we are repaying now in the form of less purchase power.
> if people knows there is recession/high inflation the thing spirals even in a deeper recession/high inflation
It’s kind of funny how this is baked into the economic orthodoxy. It’s definitely not that admitting a recession or high inflation makes the people in power look bad, no no, us not admitting it is actually good for you and you should thank us!
There's been massive investment in ventures related to AI. This is no-doubt coloring the picture. Because tech hiring and retention is way down, there have been massive layoffs. Some parts of the economy associated with investment are doing well, but this isn't associated with most people.
> Because tech hiring and retention is way down, there have been massive layoffs.
And at the same time, there is a huge number of job offers. If I wanted to quit my job, have 3 months of vacation, and look for another job again, I could get it quickly provided I accepted a 20% lower salary. This might sound bad, but frankly this is still an excellent salary for me. In contrast to people in non-tech sectors, I really have no reason to complain about.
There are interesting polls that show 70% of Americans feel their own finances are ok, but as the geography expands to local, state, and country, the perception turns increasingly dismal. People are viewing that which they cannot perceive as the worst. This seems to indicate an information dissemination issue. Other polls show that people self report most economy news they see is negative. Doom and gloom sells. There is also COVID hangover, people are still generally blasé
High "Economic output" is great for profiteers but says nothing meaningful about the experience of working people.
Low "Unemployment rate" sounds nice until you realize how many of these jobs are low wage and part-time (no benefits) although the workers need full-time employment.
Exploitation is at an all-time
high, and it's no surprise to anyond that the media isn't reporting on that.
"Some" means half of the nation. Just look up the wealth distribution charts on FRED: half of the nation's wealth belongs to 1%, and half of the nation owns just 1% of the wealth. What's worse is that the top 1% aren't the ones who have built the nation, but those who've inherited the wealth. Of course the wealth of the top 1% accumulates when the tax system takes 50% of the income of the common folk and only 20% of "long term capital gains" of the rich (unless they borrow and pay a tax deductive interest on the loan). The bottom 50% stand no chance. But yeah, SP500 is doing great.
Edit. When there's a 100 workers looking for jobs, the gov can limit the work week to 3 days and the work day to 6 hours, and call it full time employment. The rich, who want to exploit these workers, will have to bend and hire all the 100 to do the amount of work they need. Alternatively, the gov can step aside and let the rich hire just 50 workers, work them to the bone and keep the rest 50 unemployed, desperate for any work on any terms.
I've mentioned it here before, but I remember from a lecture I attended by Robert Sapolsky that the most consistent predictor of stress in a primate society (as measured by cortisol levels) was inequality. And interestingly, it elevated stress at all levels, so even those on top suffered.
"Biden" (the Democrats I suppose) have certainly failed to reverse the advancement of the oligarchs over the last half century or so, and I suppose it's worth criticizing them for that, but to be fair, they have been opposed at every turn by a party that is single-mindedly obsessed with giving more to those who already have the most.
It looks pretty likely that Trump and the Republicans will do well in the coming election, and it will at least be interesting to watch to see if the sentiment re-aligns with the economic data in the next term, but I suspect long-term it will simply increase the loops that drive inequality ever higher; another high-income tax cut isn't going to help anything.
Skill ceiling is just getting raised, just look at what’s going on in IT. Massive disparity in people who evolved and those who didn’t.
The ones that can’t code or didn’t learn modern skills like container orchestration are seeing the skill floor drop with companies migrating to SaaS everything and laying off teams, and the ones that learned are called infrastructure/devops engineers and easily make six figures. Sysadmin roles that used to pay 100k+ are now 20-25/hr at most businesses because they are just glorified office managers in 2024.
Companies are all trying to be like Amazon now, they want easily trained and replaceable people, so unless you work in a high skill ceiling job you are going to just be paid less. Even teachers are just glorified daycare workers these days. The good days are over for most people who thought the good times would never end.
I think that is definitely happening. However, if minimum wage ( or even just wages ) had kept up with inflation, the jobs number would look much weaker. People are getting exploited.
As for tech, a lot of companies want everyone to be fungible for the cheapest price as you mentioned. It’s not a market where people feel safe to takes risks or innovate for someone else’s firm, considering there is no amount of loyalty that can keep you from getting laid off.
We went through a post-covid recession where absolute numbers got fumbled by super high inflation. It seems the cost of living and food is 50-150% higher now in Spain.
People do remember how the governments tried to downplay the whole inflation situation and post-covid recession. Thinks are getting better now but since the previous recession was completely denied it doesn't feel like the small recoveries compensate for all the loss in purchase power.
By the way this is not an accusation of the Biden admistration.
This would have happened exactly the same with Trump.
> The Guardian-Harris survey also found that 49% of respondents think the S&P 500 index is down for the year. In reality, stocks have been ripping: The S&P 500 is up 13% this year on top of a 24% gain last year.
This is kind of interesting. It would be more interesting to know how that misperception has changed over time. I suspect that at any given time half of people wouldn't correctly guess whether the S&P was up or down.
“Job market is strong”
Are people being paid enough in this job market or is everyone just too desperate for crumbs to not work?
“The S&P 500 is up 13% this year”
13% for the rich is millions. 13% for the poor is (metaphorical) pennies
“62% of Americans own stocks, mostly through retirement and investing accounts”
I own stocks, $170 worth to be exact. Not a very helpful metric when the gap in ownership is so large.
“to think many people are just too dumb to know how good they have it.”
Damn.
“even if the annual rate of change is now more benign”
What was that saying? Once you start using a metric as a goal, it ceases to be a good metric?
“Now, do endless surveys asking people their opinions on the economy even matter? If Biden wins reelection in November, maybe not.”
Surprised they made it this clear. Once you’re used to win the election, you don’t matter anymore (no matter which candidate wins)
Seriously, how out of touch can and tone deaf can you be?
But, for not 5% "top" people, the economy looks terrible because:
* They see food, gas, housing and interest rates raising a lot.
* Even though their wages are ahead of inflation, they do not know or understand this. Their bank accounts may be increasing, but they cannot and will not do 1+1. It is much easier to see raising costs than raising savings.
* Job security is non-existent. Even though you may have a decent job and if you get laid you can find a new job relatively quickly. People do not feel secure and are afraid of loosing work, so they may be putting in extra hours to avoid that, thus no free time.
* Billionaires, they are always hearing about these people and that makes them feel even worse.
The Democrats are ignoring that and have no response to it. The GOP is great at pushing the bad economy and hate towards immigrants. So, when people feel insecure, they are easily pushed into the MAGA state many people are in.
The average American doesn’t care how the investor classes stocks are doing and rightly understands that the parasites in the investor class are growing their wealth by siphoning it from the labor of the masses.
Uncanny “let them eat cake” vibes from this article.