I think you and commenter Ethan Stuart are really onto something with the interest rate problem. This is especially key for young voters.
There are three more things I wonder about: a) has there been an increase in activity by Russia, China, etc. to amplify bad vibes throughout social media? b) Is the analysis granular enough WRT to haves and have not; do we have a number of group of voters who are struggling even though the average are being pulled up by the growing incomes of a smaller number who are benefiting? c) Are people very sensitive because it’s been so long since we had a major downturn like the Financial Crisis? (I’m not counting the impact of Covid shutdowns because there was so much aid and less spending, so that many people actually came out of it with savings.)
I suspect that much of the lingering negative consumer sentiment derives from the tone of the doomsday reporting on the economy from popular partisan news outlets like, say, Fox News who have a vested interest in said poor vibes ahead of the general .
I think this is spot on. Consumers in America are mostly in debt, so I think higher interest rates (and hopefully soon-to-be falling rates), higher general prices from the pandemic (and to some extent from fiscal policy), and gas prices are the top three drivers of why voters have been so pessimistic about the economy.
The price levels don’t fall without a recession. Hopefully Biden will get lucky with lower rates and gas staying low going into November ‘24, and hopefully he’ll have highly disciplined messaging about making things more affordable for people his top priority. I’ve been pleased to see his economic messaging shift recently (more empathy, more specifics on policies to make things more affordable--Bidenomics more as a secondary driver), so I think he and his team get it.
I think that the relentlessly negative reporting on the economy is a big factor in why people are feeling so negative. For well over a year we’ve been told a recession is just around the corner. It hadn’t happened yet, and looks like it won’t, but polling shows that many Americans actually think we are in recession.
Every time you turn on the news, there is some negative story about the economy, and it’s not just Fox News.
I imagine that there is simply a reporting lag. People understand that their experience the last month may not be representative so when asked about the economy they implicitly average over the past year or so (and it takes time for bills to add up etc).
Even though Josh doesn't mention politics explicitly, I think it's another major contributor to the lack of movement in consumer sentiment. Republicans will give Joe Biden zero credit for anything he does on the economy or otherwise, so roughly 35-40% of the public will express a negative consumer sentiment as long as he (or any Democrat) is in the White House. That puts a clear ceiling on any rankings of this sort. The only sway-able folks left, then, are Democrats, and the squishy, fickle middle.
“central bankers creating good vibes” was worth the price of admission this week.
Josh why you getting a loan? I thought you bought a house with a 30 year mortgage of like 2 %???
I think you and commenter Ethan Stuart are really onto something with the interest rate problem. This is especially key for young voters.
There are three more things I wonder about: a) has there been an increase in activity by Russia, China, etc. to amplify bad vibes throughout social media? b) Is the analysis granular enough WRT to haves and have not; do we have a number of group of voters who are struggling even though the average are being pulled up by the growing incomes of a smaller number who are benefiting? c) Are people very sensitive because it’s been so long since we had a major downturn like the Financial Crisis? (I’m not counting the impact of Covid shutdowns because there was so much aid and less spending, so that many people actually came out of it with savings.)
I think this is Dall-E's best work on one of your posts so far.
I suspect that much of the lingering negative consumer sentiment derives from the tone of the doomsday reporting on the economy from popular partisan news outlets like, say, Fox News who have a vested interest in said poor vibes ahead of the general .
I think this is spot on. Consumers in America are mostly in debt, so I think higher interest rates (and hopefully soon-to-be falling rates), higher general prices from the pandemic (and to some extent from fiscal policy), and gas prices are the top three drivers of why voters have been so pessimistic about the economy.
The price levels don’t fall without a recession. Hopefully Biden will get lucky with lower rates and gas staying low going into November ‘24, and hopefully he’ll have highly disciplined messaging about making things more affordable for people his top priority. I’ve been pleased to see his economic messaging shift recently (more empathy, more specifics on policies to make things more affordable--Bidenomics more as a secondary driver), so I think he and his team get it.
I think that the relentlessly negative reporting on the economy is a big factor in why people are feeling so negative. For well over a year we’ve been told a recession is just around the corner. It hadn’t happened yet, and looks like it won’t, but polling shows that many Americans actually think we are in recession.
Every time you turn on the news, there is some negative story about the economy, and it’s not just Fox News.
I imagine that there is simply a reporting lag. People understand that their experience the last month may not be representative so when asked about the economy they implicitly average over the past year or so (and it takes time for bills to add up etc).
Even though Josh doesn't mention politics explicitly, I think it's another major contributor to the lack of movement in consumer sentiment. Republicans will give Joe Biden zero credit for anything he does on the economy or otherwise, so roughly 35-40% of the public will express a negative consumer sentiment as long as he (or any Democrat) is in the White House. That puts a clear ceiling on any rankings of this sort. The only sway-able folks left, then, are Democrats, and the squishy, fickle middle.
We had to refinance in the fall because our 7-year adjustable ended. It was brutal.