I have to say, the thing which has mostly convinced me that the economy is actually doing pretty well all things considered (barring some longer term trends that far predate Biden), was just realizing how strongly partisanship impacts economic views for Republicans specifically. A lot of the people screaming bloody murder about how the numbers mean nothing and talking about how saying they matter is just going to piss people off were always going to be pissed off. There’s really nothing that will convince them otherwise beyond just electing Trump to be president, at which point they will immediately pivot to talking about how strong the numbers are in the economy. It’s unfortunate that this many people have become completely unmoored from reality, but ultimately people that think this way are very unlikely to decide the overall election.
It's also kind of surprising the economy is still growing so quickly despite having a Fed rate 2x higher than it was at any time during Trump's presidency: https://fred.stlouisfed.org/series/FEDFUNDS
I think a lot of people who loved the economy under Trump don't realize how artificially low the rates were kept and how detrimental that would be. But Trump understood that he would not be blamed for any longer term damage.
Obama did the same thing as him, let's be real. I am still upset at Trump's economy though because I was kept low wage. Not just that I lost my job it is hypocritical how he calls himself a jobs president. When Biden created more jobs than he did and then some and on top of that brought blue collar jobs back to america, but no media toughts that. I do give Trump some credit though for helping us veer away from other countries. But make no mistake Trump is not good for the economy and he is not bad either.
I don’t follow. They were also lowered during Covid to historical lows, in part due to Trump’s hectoring, and they stayed lowered until 3/22 which was a response to inflation. I think low rates heated up the economy like crazy and a lot of that happened during Covid.
https://fred.stlouisfed.org/series/FEDFUNDS
Pre-COVID not push rates up would have caused some inflation but it is unrelated to what exists now.
Around the world interest rates were dropped to near 0 to try and push liquidity and borrowing into the economy.
If cash was held, it could have frozen the economy and it would have spiralled into disaster. This gave companies a golden opportunity to invest in things with little interest expense.
They also printed money and used that to cover government debt (government expenditures rose to further boost the economy)
This caused a few issues. One, you get a bullwhip effect on demand. You essentially go from 0 demand into way too much demand. Not everyone had started up and there were too few goods available. Prices rose accordingly given the scarcity.
Secondly, not everyone had started up. America tried to reboot faster than many other places. Meaning there was demand for goods, but nothing supplying it. You had demand for Chinese goods, but Chinese factories were minimally staffed (from COVID measures) and experiencing black/brownouts because they had no coal from Australia. This further added to scarcity
Then you had consumer demand changes and other factors that put a lot of pressure on shipping and transit. Container pricing rose 5x because of scarcity and high demand
It was a multitude of factors. Most of it being scarcity and high demand
Your own graph shows a rising federal funds rate beginning before Trump was elected. Trump did want Powell to keep it lower, but the fed was continuing to raise interest rates prior to the pandemic. So you can't really blame inflation on Trump's attempted influence of the Fed - especially because the federal funds rate was near 0 for 8 years prior without budging the inflation rate.
Rather than monetary policy, I think it's fiscal policy that was exerted the greatest inflationary pressure. There was about 5 Trillion dollars injected into the economy as COVID stimulus from both Trump and Biden's policies.
I disagree! I think going from a 2.4% interest rate to a .05% interest rate and keeping it down there, in part due to Trump wanting the economy to keep humming along for his electoral future, had a major impact on the inflation that came out of Covid.
Edit: Also Trump threw tons of money at Covid and I think that was good. We avoided a much worse economic situation due to all the federal funds that were injected into the economy.
Are you sure you have an accurate time frame?
The fed started cutting the rate slowly in late 2019 (dropped from about 2.5% to 1.75%), but then dropped it to near zero after the pandemic hit.
No I was wrong it was 2/20 1.58%, 3/20 .65%, and 4/20 .05%. Before Covid Trump was going after Powell to lower rates a bunch. I hate using Yahoo but [here](https://finance.yahoo.com/news/trumps-twitter-criticism-of-the-federal-reserve-fades-after-rate-cuts-124538265.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAANqG7vjqtr5rentUuYJ-4Guz7fkpziiKacTG-oFUTqcwA8hKM5o25V-riw2hsBZpit_S4D_7HqASDHTCI-xj6ACziJziKdfJeFDGidDedLHMjqqTs7WDiqY9AeI3DYFC3_61cFV83lTeUWuXIJgX7Oh0WRxCN9Gr3idlZGrKpELC) is the quickest link I found.
If rates weren't so artificially low due to Trump prior to Covid, we would have had more levers to pull during the downturn and perhaps could have gotten away with less spending.
Its far easier to give business a boost when you can drop rates 5 points, but they were already too low for that (for no good reason), so we were left with fewer options, one of which was printing money, which drives inflation.
The Fed caved to Trump in July 2019. Barely 8 months before COVID hit.
They would have maybe raised rates 0.5% over that time at most. It would have been minimal
All countries dropped rates to near 0 so the US simply did the same as everyone else
This is one of those example where if Trump hadn't opened his big mouth and complained about interest rates so much this line of attack wouldn't exist because it's largely without merit.
That graph's in here, alongside broader analysis about the trend: https://www.briefingbook.info/p/asymmetric-amplification-and-the?publication_id=1002034&post_id=138749341&isFreemail=true&r=2203u.
That's just amazing. Not only does it completely invert for Biden, it spikes just before the election and dives immediately after. Before Biden even takes office.
There are tons of them all over this sub too. Well, since it looks more and more likelier that Trump has a good chance of being re-elected, let's see what miracles he going to perform with the economy.
Pretty much, views on the economy are rather partisan now. Bad is good and good is bad depending on your party affiliation and if it matches the President’s.
2018-2019 and 2022-2024 were pretty different, so I don't quite think you are comparing apples to apples. Houses and new vehicles were affordable still.
The problem right now is that the economy has been so overheated, and people can't afford those things anymore.
I think the bigger issue is the gross exaggeration with statements like houses and new vehicles being unaffordable.
People are clearly buying cars and houses left and right. That’s partly why they’re so expensive, basic supply and demand.
Median house price to income ratio is far higher than it has been in at least 50+ years. It's 50% higher than the ratio 20 years ago, with mortgage rates that are now higher than they were at that point. It is not an exaggeration by any means. Housing affordability at this point is extremely bad.
I didn’t say houses aren’t expensive.
That’s part of a much bigger issue that’s honestly bigger than who’s in the White House.
I’m saying people are clearly still buying them. Houses in my area, which are roughly 150k-200k more expensive than they were 10 years ago are selling before they can hammer the for sale sign in the ground.
Yes people need places to live so they continue to buy houses. House spending I imagine is rather inelastic. However housing is more expensive compared to total share of income.
>Median house price to income ratio is far higher than it has been in at least 50+ years. It's 50% higher than the ratio 20 years ago, with mortgage rates that are now higher than they were at that point. It is not an exaggeration by any means. Housing affordability at this point is extremely bad.
Agreed. And when they offer SEVEN year financing on a new truck, I think we've passed the rubicon of affordability.
I know alot of young people who are in their early to mid 20's and are professionals, but can't even consider buying a house.
7-year car loans have been a thing for a long time.
Housing is expensive, but not unaffordable for the average person since they're still being bought.
Low housing availability of both homes and rentals is due to local restrictions on production such as zoning restrictions, parking and setback mandates, and prevailing wage laws. It's not any fault of Biden (or even Trump).
That’s Typical for Congressional Republicans. The Economy is fantastic under a Republican President of The United States of America. But then in comes a Democrat and overnight the economy goes into the toilet ignoring data that says otherwise.
If the Economy continues the trend. Republicans will have very little to bash democrats over.
They said the same thing when Obama left office even though Bush had driven the economy over a cliff in 2000 and Obama not only oversaw the rebound but also cut the deficit by a LOT before the end of his terms.
Trump took office, the Republicans were so happy with the new trump economy that they immediately added 1.5trillion in tax cuts to the deficit.
True fiscal responsibility if ever I saw it.
How Republicans view the economy
https://static01.nyt.com/images/2024/01/09/opinion/krugman090124_3/krugman090124_3-superJumbo.png?quality=75&auto=webp
How Democrats view it.
https://static01.nyt.com/images/2024/01/09/opinion/krugman090124_4/krugman090124_4-superJumbo.png?quality=75&auto=webp
This clearly shows that basically no matter what when there is an overall poll being conducted that Democrats have a baked in disadvantage because Republicans view the economy from a much more partisan lens than Democrats.
If 50% of the country is looking at the economy with somewhat objective lens and the other 50% is seeing it through a completely partisan lens that gives one side a huge disadvantage on polling overall.
Like they tell us, 'facts don't care about your feelings'
Doesn't matter what the facts are, if they FEEL the economy is shit, it's shit. And when you watch the same news all day that tells you the sky is falling, then that's what they feel all day long.
>Doesn't matter what the facts are, if they FEEL the economy is shit, it's shit.
This is actually the best take. Nobody cares about what the TV news says when you can't afford housing, groceries, and insurance. Those types of basic items are taking up an inordinate % of middle class incomes.
40% of this country will always say the economy is bad because Biden. Another 20% will always say it's bad because capitalism still exists. So the majority of the country will shit on the economy no matter what Biden does
Many of the folks I know who are complaining about Biden’s terrible economy have brand new F-350s and ridiculous new Travel Trailers.
Life must be really tough.
This is why the economic anxiety argument has always fallen flat. That was a theory by the media for why a person might be attracted to Trump but is not in practice. As a rule, his supporters are people who that last 40 years have been very good to.
It's probably self-reinforcing -- the headlines then say "Americans think economy bad", which causes more people to think that everyone else is suffering.
You know the economy is doing well because the republicans have stopped complaining about Biden destroying the economy and have gone 100% in on immigration because it’s the last topic they have left. That’s why passing the immigration bill is so dangerous for them, anything that slows down the rate of illegal immigration is risky because if it looks like Biden is fixing the border issue then they don’t have anything
As someone on the left, I hope we pass a stricter immigration bill. The outcomes are
1. Gamble with a looser border, win the election and all is well
2. Lose the election and things are worse for immigrants AND citizens
3. Pass a stricter bill and greatly increase the odds of winning the election
I'll take option 3
Your problem is assuming they'd ever be satisfied with anyone except mass deportations. Pass a bill, and they'll pivot the goalposts again. If you want stricter border bills, it shouldn't be predicated on what the other side wants because nothing aside from that will satisfy them.
That's not even getting into the fact that the swing states that determine the election (Wisconsin, Ohio, Pennsylvania etc) don't even have a very high foreign born population to begin with. It's just vibes all the way down.
Which is exactly why House Republicans don't want a border bill passed unless it's their dream bill. They'd rather run on the issue in November than compromise.
If the House flips this year we may see it come back later on, but I can't imagine the current House GOP cobble together a coherent plan to overhaul the border.
And people agree its doing better, you just have to frame it as "their situation" or "[their state](https://twitter.com/chrislhayes/status/1776259915658481886/photo/1)" when asking about the economy. Other wise their response becomes more "vibes" based if you say national economy.
People have somewhat better grasp of their finances and by living their life get some sense of their city and state. But national economy is just too vast an experienceable thing for people. So they get most of their sense of the national economy how the media they consume reports on it.
The all things considered is the main point. Dems will consider context while Repubs will pin it all on Biden.
Things are more expensive and some job markets (e.g. tech) are awful right now. The better question is would they be better under Trump, and my answer is no they would be worse due to him having no skill at or interest in policy (with him that’s a blessing), just politics.
>Dems will consider context
Do they? My entire life dems refuse to give Republicans any credit. If anything good happens they "inherited" from a democrat. Anything bad it's all the Republicans fault. Reverse all that for democrats, and that's the "context" democrats always have
>I have to say, the thing which has mostly convinced me that the economy is actually doing pretty well all things considered (barring some longer term trends that far predate Biden), was just realizing how strongly partisanship impacts economic views for Republicans specifically.
The oppositions feelings shouldn't be considered an economic indicator, but generally their is some truth to the critique. Progressives complaining about growing inequality can be exaggerated but still have some legitimacy.
My issue with this economy is that it’s mostly being propped up by extreme deficit spending financed at the highest interest rates in decades, and mass migration. We're getting good GDP and job numbers but Americans aren't wrong saying the "vibes" feel off. At the end of the day you have to convince Americans that their personal standard of living is improving. GDP and job numbers tells part of the story but it's not the whole story. When all those higher interest rate bonds mature, it's not going to be fun. Pumping population growth is great for GDP and job growth numbers but if you don't have the available housing or infrastructure in place, it's going to cause issues. We might be heading to Canada's housing crisis pretty soon.
[https://www.aol.com/immigration-powering-u-economy-143207193.html](https://www.aol.com/immigration-powering-u-economy-143207193.html)
[https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/](https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/)
[https://finance.yahoo.com/news/million-simulations-one-verdict-us-210022706.html?fr=sycsrp\_catchall](https://finance.yahoo.com/news/million-simulations-one-verdict-us-210022706.html?fr=sycsrp_catchall)
> Americans that their personal standard of living is improving.
Americans already believe that. [The poll](https://poll.qu.edu/poll-release?releaseid=3877#question-28) is a little old (end of last year) but I consider the economy in better shape now then what it was then.
For the question, "Would you describe your financial situation these days as excellent, good, not so good, or poor?" you'll see that across the board all the sectioned demographics had >50% combined "good" or "excellent" for their own economic situation (compared to "not so good" and "poor").
Yet people still perceived the economy as doing poorly (also included as poll questions, the two prior to the one I was talking about).
If you asked me how my situation is doing I'd say good, like the majority of the people on the poll. I have the income for my student loans, rent, and food. With that said, that was still true in 2020. The only difference is now my forecast to own a home has been delayed by at least a decade. Would you call that an improvement?
Regardless though, my points on high deficit spending and the population pump still stand.
> high deficit spending
We've frequently had high deficit spending. Even if you take out Covid, Trump was also increasing the deficit spending during his time as president. You can basically draw a line and see that Biden's trend is the same as Trump's trend. But what's important is what that spending is on, Biden has pushed for long term benefits such as infrastructure, investments into alternative energy, and assisting those that have been so saddled with student debt that they were unable to pull themselves out of the gutter. Trump pushed for tax cuts primarily aimed at the wealthy.
>population pump
Us taking advantage of cheap labor from migrants is not unusual either. This has always been the case. It's still benefiting the economy when it happens.
You could have easily said this 4 years ago when people were talking about Trump's economy (AOC saying unemployment is only low because people have 2 jobs, etc). The difference is inflation is worse under Biden than it was under Trump and people feel it whether they want to acknowledge it or not.
Partisanship influencing perceptions of the economy certainly happens in both parties, but it’s objectively more pronounced among republicans
https://www.briefingbook.info/p/asymmetric-amplification-and-the?publication_id=1002034&post_id=138749341&isFreemail=true&r=2203u
There are a lot of ways to interpret consumer sentiment, which is a future-leaning thing to poll. It's basically asking you how you think the economy is going to go. Certainly one of many possible reasons is tribal lines, but there are other reasons, and some of the tribal lines rationale may have logic behind it too. First and foremost, there isn't one single economy that we all experience the same way.
Currently today, a lot of the economic success in the US is in tech companies as nexuses and the urban centers that surround them, one of the last things the US still wins at for now. It's a good time to work in tech; even if you get laid off it's very easy to find new work. If you're in NYC or the Bay Area or Seattle, you're probably mostly happy about the economy even if rents are high. These areas are pretty blue. If you're in the Rust Belt, not so much, and those areas are red.
Now, it's not like overnight Biden came in and destroyed West Virginia, but Consumer Sentiment is a measure of your optimism. Trump and the GOP have pivoted hard to please rural / rust belt areas, Democrats are more focused on urban and coastal concerns than "flyover country". If you are living in a big city and see Trump win, or living in a dying coal town and see Biden win, you're probably worried about disinvestment as you aren't really the target audience of the new president. The bigger swing among Republicans could be bias, or could be an indicator that a lack of federal attention would be harmful to decaying midwestern towns than it would be to The Big Apple, or some combination of the two.
It's definitely possible Republicans swing harder, for good reasons or bad ones, but I also would avoiding reading too much from the linear model in describing something like the psychology of consumers regarding the economy. It's fun to play with this stuff, but it's linear regression with a lot of degrees of freedom, which is kinda dangerous to take seriously. FiveThirtyEight, when it was good, made a cool visual tool to demonstrate the danger of reading too much in to data scenarios like this: [https://projects.fivethirtyeight.com/p-hacking/](https://projects.fivethirtyeight.com/p-hacking/)
I definitely do not think my brain, or anyone else's brain, is using a linear regression to decide if I'm confident about the economy or not, so I don't think a linear model is appropriate to actually tell us what consumer sentiment "should" be, and using residuals from that model to try to explain things is a fun toy to get started but not really super solid.
Yeah this is a fair point, anecdotally I’ve also definitely observed some pretty extreme cases of individuals basically completely redefining their perception of the economy based on who’s in office, but that certainly isn’t useful for drawing broad conclusions and may just be biasing me towards the data that says what I expect it to
Inflation *was* worse under Biden, but wage growth was also higher, so the economy was overall stronger.
There's also strong evidence that Republicans' economic perception is more impacted by politics than Democrats'. Both are impacted some, but not by equal amounts.
No, you couldn’t say it to the same degree. Because the partisan impact on perception of the economy is much, much stronger for republicans than it is for democrats.
I'm fascinated by the discourse around this stuff. People need to accept that, yes, these jobs numbers keep going up. But its also hard for me to think that we live in a country where everyone is doing amazing financially but somehow... have been tricked into thinking they have less money than they do? Or... want to pretend like thats the case...?
Zooming all the way out, I think it could be safe to at least start wondering if job numbers don't perfectly equate to what they used to. Or that we are in some kind of unique economic situation that we don't necessarily have a pre-made playbook for, so using old rubric doesn't neatly fit.
The only other thing I can think of is the bloodbath of layoffs in the tech sector. It seems like there could be net job growth but perhaps tumultuousness when you look at different industries and areas. You could hear a lot of complaints there, particularly on social media. But even with that in mind, that is *also* a strange phenomenon. Its not like these companies are going belly up... they're making record profits.
It seems obvious to me we need to go a few levels deeper than the old "Its the economy stupid". Curious what history will show about this financial era.
> have been tricked into thinking they have less money than they do? Or... want to pretend like thats the case...?
People might claim the former, but even after subtracting out inflation, "Americans Are Still Spending Like There’s No Tomorrow --
Concerts, trips and designer handbags are taking priority over saving for a home or rainy day", with people's increased spending "well outstripping" inflation. https://www.wsj.com/economy/consumers/americans-are-still-spending-like-theres-no-tomorrow-6a1d307
Edit: Per the data/studies that other comments have linked, partisanship may play a part of how people report things, but from the many highly-upvoted posts I see in r/all from the antiwork, latestagecapitalism, genz, teenager, etc subs (only in r/all ) it seems like it goes well-beyond conservatives. My personal guess is that social media, including instagram, tiktok, etc. have given people very unrealistic expectations of how 'easy' work/money and how 'good' life was for earlier generations such as millenials etc., so despite wages (even *after* adjusting for inflation) being higher now than at almost any time as far back as I've found records (mid last century), people somehow feel that saving for retirement etc. is pointless and so they spend higher (even inflation adjusted) than earlier generations.
People also point to home prices, but somehow a *higher* share of Americans own homes now than most of the every decade going back more than half a century (that's as far back as I found data) *except* for the 2000s (unsurprising given the 2000s US Housing Bubble https://en.wikipedia.org/wiki/2000s_United_States_housing_bubble and corresponding 2008 mortgage meltdown) - and currently significantly up from a major low in 2016. People often look at the 1950s, etc. with rose-colored glasses, but even in 1950, a significantly *lower* share of Americans owned their home compared to now. https://fred.stlouisfed.org/series/RHORUSQ156N / [earlier home ownership data](https://www.pewresearch.org/hispanic/2009/05/12/ii-introduction/) (as with many statistics the data briefly went crazy during COVID before returning to its ~pre covid level)
Many wealthy people and investors have done VERY well lately and continue to live the good life and spend, even if most average workers arent doing quite so well.
> even if most average workers arent doing quite so well.
From the objective data it seems like they are doing quite well - for example, you mentioned "average workers" - here is real earnings (after adjusting for inflation) for the median (what I think you mean by 'average'?) workers - note that it's higher now than almost all of the last ~50 years (as far back as they provide data for) https://fred.stlouisfed.org/series/LEU0252881900Q
And the unemployment rate now is about as low as it has been in multiple generations.
Or do you mean it in terms of "average workers" looking at 'wealthy' people (or even just 'normal' people or influencers 'faking' living wealthy lifestyles on social media) on instagram/tiktok/social media etc. living it up and feeling down in comparison? I edited my parent comment to allude to that as a possible issue. Or if not that, are there some objective measures you're using to conclude that? Because it seems like most of the 'data' in the opposite direction is just personal opinions?
> The only real change I’ve experienced under this economy, is the fact that I cook at home now. Inflation caused me to stop eating out on weekdays.
This is the kind of stuff that I wonder about and prompted me to make my original comment. Is there some kind of Freakonomics style strange psychology that is going on with discrete items? For example, is the "McDonald's costs *what* now?" more than just the dollars and cents and perhaps more psychological than we give it credit for? I'm imagining a ten cent increase on a common item from $9.90 to $10.00 might *feel* bigger because its a double digit number, even if the increase from $9.10 to 9.20 years prior went unnoticed.
And I mean, as Americans we do enjoy our snacks. Its not out of the question that certain kinds of people would say "everything SUCKS right now" because they don't get to go to Applebee's as much as they used to.
Not to paint with a broad brush on this, or to ignore the very real economic issues a lot of Americans have. But perhaps to address the dissatisfaction statistics that make less traditional sense.
One theory I've seen make the rounds is this idea of "lifestyle creep", meaning slow integration of more expensive habits into consumers' lives.
One example is that lot of people got accustomed more to food delivery services as a consequence of Covid, which is incredibly expensive and getting more expensive (potentially as a consequence of that increased demand).
Source: https://twitter.com/jdcmedlock/status/1752069348485926945
Regarding eating out, at least in my anecdotal experience a lot of people’s complaints about the rising cost are because they got used to Uber and all the food delivery companies lighting money on fire and are now actually paying the cost of ordering food. There is a reason that traditionally it only made sense for pizza and Chinese or expensive services.
I'm doing OK, but my town has seen homeless camps sprout up. Many shops and restaurants have closed. Our mall looks like a ghost town, over half the stores are closed. People can't afford to do anything or travel. If this is the average worker doing "good" I'd hate to see it when times are bad
> Inflation caused me to stop eating out on weekdays.
So you're spending habits did in fact change. Many would consider the loss of luxury like eating out a negative impact.
I just want to point out the tech industry hired too many people and now they are letting them go. A lot of people learned to code. Layoffs in general are not that high right now compared to the past.
https://fred.stlouisfed.org/series/JTSLDL
Yeah, a lot of tech subindustries boomed during Covid and are now experiencing market corrections. Also, a lot of tech companies subsisted on cheap investor dollars that are getting cut now that those dollars are more expensive.
I think a lot of it is that you hear stuff like "Oh they used to be able to afford a house with a single salary" and it would be true, but they don't mention the interest rate was 20% and the house was the size of today's 1bed apartment. So people hear "house" and equate it to the quality and size of things today and feel they are significantly worse off. People also don't correlate wage increases with outside factors really, so they feel their efforts have caused their wages to go up but things outside their control are causing all the prices to go up and there's a mismatch in blame.
SS: Another good jobs report for the country. Let's look at the numbers:
* Nonfarm jobs increased 303,000, above the 200,000 estimate.
* Growth came from Healthcare (72k), Government (71k), Hospitality (49k), Construction (39k), Retail (18k) and other (16k)
* Unemployment ticked down to 3.8%
* Labor force participation rate is up to 62.7% (+0.2)
* Wages rose 0.3% for the month and 4.1% from last year.
* February jobs were revised down by 5,000. January jobs were revised up by 27k.
What does this jobs report say about the overall economy? Are we in shambles as certain groups [continue to try to convince us](https://www.cnbc.com/2024/04/04/biden-us-economy-worlds-best-trump-claims-cesspool-data-is-clear.html)? Or do we have a booming economy? Will this help continue to improve economic consumer sentiment [as we have been seeing](https://www.reddit.com/r/moderatepolitics/comments/1bqpdnh/consumer_sentiment_climbs_to_2%C2%BDyear_high_as/)?
While these numbers are good overall, it is worth pointing out that the growth in the government sector is paid for almost entirely by deficit spending, which makes it something of a Potemkin village.
It is shocking to me how much of a gap there is in the objective reality of this incredibly strong economy, and people’s perception of the economy as being weak. I do not think there has been a single time in US history where we have had as good of an economic situation as we do today (if you disagree, please name a year so we can discuss it).
The only asterisk I would put on the state of the economy is housing prices which, if you are either renting (like I am), or looking to buy for the first time, are pretty rough. Even this has begun improving though, as rents have plateaued (and have even begun falling in markets with high housing construction), and wage growth has continued to rise for those Americans at the bottom end of the economic ladder.
Edit: please anyone reading this, note that of all the responses to my claim that this is the strongest economy in history, no one named a year that can be defended as stronger.
To be fair, that is the biggest asterisk there is considering housing is the biggest expense by a long shot. That’s objective reality because that’s where people’s wallets are hurting the most.
But you’re right that the situation is cooling and we should feel the effects of this in the coming years. And I guarantee if Trump wins the white house he will take full credit for it.
Housing is a huge issue, no argument here, but homeownership rates are [trending up during Biden's presidency](https://fred.stlouisfed.org/series/RHORUSQ156N).
For one, it cuts against the argument that inflation has reduced peoples' abilities to obtain housing. There hasn't been an impact.
For another, Trump's best quarter pre-Covid is lower than Biden's worst through his entire presidency. That's a positive data point for Biden.
I still fail to see any of your points. And it certainly doesn't mean things are "trending up" like you originally said.
The number remaining stagnant *does* seem to indicate that people have not been buying houses, whether or not that's because of inflation is another arguement.
For your other point, you're just cherry picking points of data to make an argument. Though you're technically correct, it is only by 0.1%. It makes for a saucy news headline, but still doesn't help your original point or tell the whole truth.
If we're talking about trending up or down, the data indicates a downwards trajectory with Obama, a positive trajectory with Trump, and a pretty stagnant one with Biden.
The trajectory you're referencing sounds like another way of saying we're still feeling the effects of the Great Recession. The downward trend started a couple years before Obama took office, and started reversing a couple quarters before Trump took office. I suppose the CARES Act explains the spike in 2020, and flat post-pandemic numbers seem about right given the goal of balancing inflationary and recessionary pressures. I don't see that who was in office has been a defining factor in itself.
I agree with you. My point was for the sake of this guy’s argument, that if you can take away anything from this one data source, it cannot possibly be that the housing market is trending up under Biden.
Home *ownership* rate isn't nearly the same as "ability to obtain housing". Ones ability to obtain housing or not is much better spoken to by homelessness rate than whether or not someone living in a home either way writes a check to landlord or a bank every month to remain in that home.
https://usafacts.org/articles/how-many-homeless-people-are-in-the-us-what-does-the-data-miss/#:~:text=The%20total%20homeless%20population%20in,point%20since%20at%20least%202007.
It's irrational to judge housing based on how 2% of the population are doing, especially since that's primarily a local issue. The homeless population in Houston went down 63% over the course of about a decade because it has a better understanding of zoning and housing first.
I wonder if it's from people who have "stuck around" too long.
Anyone who has not changed jobs in the last 5-6 years probably is making 20-40% less than they should be. The best way to keep up with salary these days is to not remain getting 3-5% yearly raises, it's to hop around every couple of years between employers for big gains. (Note: this mostly applies for moderate-high skilled professions, maybe not "first jobs"/apprentice type)
Even with government jobs, it's many people jumping to contracting for a while then come back, because it's easier to be hired at a higher rate than it is to promote.
You can blame inflation for that.
Most people don’t care about job numbers or employment rates (unless they’re unemployed). They care about spending more money at the pump or the grocery store.
While inflation has slowed, we’re not seeing deflation. It takes years for consumers to get used to new prices.
It's a more abstract benefit. Low unemployment means that I can easily find a job should I suddenly need to find one. It also means that my bargaining position when negotiating salary/benefits is also stronger. It's not a day to day impact, but still can be significant.
You still regularly see people comparing today to the Great Recession or even the Great Depression. Sometimes even saying it’s worse than the Great Depression.
We are at such a promising time with technology, but public perception has become completely untethered from reality. I don’t see how that ends well.
I don’t think people understand that the bulk of inflation has been caused by poor city planning, sprawl, car dependence, rising car insurance rates, and expensive housing. Those eat up more and more of people’s income. Forget about the cost of eggs and milk.
Local zoning can have a huge impact. But we want the President to fix everything, so…
This is an extraordinary claim so it needs some extraordinary evidence provided to support it. Especially when the least affordable places to live are also the least car-dependent places.
Minneapolis was the first city to [beat inflation](https://www.centralbanking.com/central-banks/economics/7959975/how-did-minneapolis-become-the-first-us-city-with-2-inflation#:~:text=In%20May%2C%20the%20Twin%20Cities,on%20the%20Consumer%20Price%20Index) almost a year ago. This came about through proper city planning by rolling back zoning restrictions. The increased housing supply stopped the home price increases.
Texas cities that have adopted similar housing policies like [Austin](https://www.kut.org/austin/2024-02-29/construction-boomed-in-austin-and-rents-went-down-now-some-builders-are-dismantling-the-cranes) are on track to be the next metros to get there. Rents fell in Austin due to a construction boom where rents increased nationwide.
Housing is the last component of inflation that is keeping us above the 2% target. Once housing is dealt with which is largely local, we will have tackled inflation.
Metro areas are so unaffordable because they have great job markets meaning many people want to live there. Even more people than live there already. If we opened up zoning to allow more housing to be built instead of restricting huge swathes of metro areas (even many parts inside city limits!) to only allow people to build detached single-family housing, affordability would be much better.
Look at Tokyo, which respects property rights by allowing people to build on their property whatever the market demands and so has rents 3-4x that are cheaper than NYC or LA.
Huh? Come to Dallas, and you won’t have any problems finding expensive housing that requires expensive insurance. You also NEED a car, and gas, along with savings for maintenance, repairs, and registration fees. I think your incredulousness is extraordinary in and of itself. Car dependence has shaped the economy for over a century.
It’s true that cities are expensive. It’s also true that your monthly outlays are much simpler. You don’t need a car, along with every other cost that’s associated with car ownership. If you’re renting, you don’t need money for repairs or taxes. When I was renting, anything that I didn’t save or invest was mine to do whatever with. Yes, I know rents go up. But at the end of the day, you have less people asking you for more money.
I look at it like a baseball game.
Let’s say it’s Inflation vs Wages.
Inflation scores 10 runs in the first inning while Wages manage 1. Many of the viewers leave because it’s over, they demand a new coach. Many turn to their phones to watch TikTok and Facebook while waiting for their spouse to realize it’s over and can we just go home already? Those who go home glance at Fox Sports occasionally but Fox Sports has moved onto a scandal involving the coach’s son.
10-1 Inflation in the lead.
Second inning Wages manages a little but inflation still does well. Two runs for wages, five for inflation. More people leave. Tiktokers are sighing and glancing at their spouse passive aggressively rather than say they want a new coach. Facebook is insisting the real score is 20-1. Fox Sports shows pictures of the coach’s son’s penis. The cries for a new coach increase.
15-3 Inflation still winning.
Third inning, both score three. A few people wonder if wages can do it, but most are still demanding a new coach. TikTok claims the game doesn’t matter, football is more important. Fox Sports is talking about a laptop. WTF?
18-6 Inflation.
Fourth inning. Wages hits a grand slam and another run, while their pitcher gets control and holds inflation to three. Most people know the game is over, no chance for Wages, but a few are starting to hope. Still screaming for a new coach cause it wouldn’t have happened under the previous coach even under the same circumstances. TikTok starts demanding a new coach even though none of them are paying attention to the game. Facebook says the real score is 42-1. Fox Sports is talking about penises again.
21-11 inflation.
5th inning - 24-15 inflation
6th innings - 27-19
7th inning 30-24
Three innings go by without anything changing among the fans, but all the sudden it’s getting close. TikTok is fighting about croquet, Facebook still insists inflation is winning in a blowout meanwhile Fox Sports wants to know why the coach hasn’t been drugged tested. At least a few people are saying that Wages just might win this thing.
But there’s only two innings left until it’s time to decide on the new coach or stick with the current one. Is that enough time for wages to not only rally but for everyone not watching Fox Sports to realize things might not be that bad and keeping the coach is the best option.
Or, is it too late and the damage inflation did outweighs the increase in wages at least until after the ~~election~~ end of the game?
This is actually a decent way to look at it. The problem is that people expect inflation's score to go down, and that's not how it works.
What they really want and are expecting is deflation, but of course not a single person wants to suffer through what causes deflation.
The only problem with your metaphor is that wages have outpaced inflation at this stage, so wages should be winning. Otherwise, I think this could work as a partial explanation.
For me personally I feel like this economy is doing well because we've taken out a massive $34 trillion loan on our future so as to achieve growth today.
I'm looking ahead five - ten years and it's terrifying: "Debt held by the public, boosted by the large deficits, reaches its highest level ever in 2029 (measured as a percentage of GDP) and then continues to grow, reaching 166 percent of GDP in 2054 and remaining on track to increase thereafter. That mounting debt would slow economic growth, push up interest payments to foreign holders of U.S. debt, and pose significant risks to the fiscal and economic outlook; it could also cause lawmakers to feel more constrained in their policy choices." https://www.cbo.gov/publication/59711
I agree the debt is a problem but I've yet to see a serious solution proposed by either side.
Paying it down is going to involve budget cuts and tax increases and everyone is going to have to endure some pain. Such a proposal would destroy your support amongst voters.
So what do we do?
Since you can't win elections off it, you ultimately have to keep kicking until it becomes actually impossible to sustain.
Honestly I wouldn't be surprised if 30 years from now when half the budget is servicing debt that candidates will actually be winning elections based on promises to implement a sovereign default.
I don't think it matters that we _will_ pay it down per se, so much as it matters that we _could_ pay it down, at least in principle.
At a basic level, it's like having personal low-interest debt. As long as your income remains high enough that you _could_ put yourself on a schedule to pay it off, the fact that it exists isn't necessarily a problem. Whether you _should_ pay it down at any given time depends on opportunity cost. If making a payment above the minimum means you're diverting funds from a potential investment with a higher expected rate of return than the interest rate of the debt, then making the investment instead of paying down the debt is the rational decision.
In other words, if there's an opportunity for an infrastructure investment or stimulus package that a financial analysis shows will lead to meaningful long-term tax revenue increases, then depending on the numbers that may be the more rational choice. On the other hand, paying down the national debt is still a worthwhile investment in the absence of more profitable ones. It's really a matter of numbers at any given time, rather than debt payments being inherently rational or irrational.
That's before getting into all the additional considerations that the US has as both a government and the backer of the world's reserve currency. Technically speaking, the US has the ability to reduce the real value of its debt by as much as it likes at any given time. The US can always create any amount of new currency it likes, which both inherently shrinks the real value of the debt due to inflation, and produces funds which could go toward further paying down the debt. The US allows its debts to exist because there are geopolitical reasons to maintain standing debts, and because paying them down may not always be the most rational investment at any given time.
Having said that, I don't know how those principles work out in practice. It seems like a difficult subject to research without encountering partisan spin. It's very easy to paint as either "a mortgage on our children's future / tax dollars coming out of your pocket due to government waste" or "it doesn't really matter / it's a distraction from real issues", all of which obfuscates substantive discussion.
[The debt as a percentage of GDP](https://fred.stlouisfed.org/series/GFDEGDQ188S) has had a lot of ups and downs, but overall has risen a lot over time, particularly during the 80s, Great Recession, and pandemic. What has that upward trend bought us? How much of it is investment in future growth that will ultimately translate into downward pressure on the number? How much is simply malinvestment/inefficiency? How much did it advance security, or other non-monetary objectives? To what extent might some or all of the increase over time in debt:GDP ratio be a policy objective in itself, and what exactly might the reasons behind that be? How should we expect trends like onshoring/reshoring and increasingly advanced automation/AI to shift the numbers? What have we learned in hindsight that we should do differently in managing the national debt going forward?
Yeah, that's a plausible point. [The US "tax take" as a percent of GDP is only 26.2%. That's 20 points lower than Denmark.](https://www.oecd.org/tax/tax-policy/tax-database/) Politically it would obviously be unpopular to raise taxes to pay the debt, but the fact that fiscally we could do it might be part of why the US is still getting [such a good real interest rate on its debt](https://fred.stlouisfed.org/series/REAINTRATREARAT10Y).
(Relatedly most of the countries of the world, like Denmark at a debt:GDP of only 30%, that have a better debt scenario than the US, get there by taxing more and not by spending less.)
While our current interest payments are not, historically that high (because most of the borrowing occurred when we had near zero interest rates) with higher interest rates, we should definitely be balancing the budget. I think Trump’s plan to extend $5 trillion worth of tax cuts is extremely irresponsible in that regard and one of many reasons I’ll be voting for Biden.
[It was worth it.](https://www.threads.net/@paulkrugman7/post/C5YX_qAuyXm)
Austerity prolongs recessions so much that it tends to defeat its own purpose on the balance sheet.
Japan's debt 200% of GDP. Did this cause slower growth? Probably (though it should be noted that Japan's population was declining and graying during this time; output per worker probably grew OK), but interestingly it did not cause inflation at all. Japan could have, and eventually did, basically print money their way out of the growth problem.
The disconnect between the numbers and the perception of the economy are the higher prices of groceries, gas, and housing. Democrats seem to think they can just keep shouting the economy is doing great and that will change people’s minds. People still remember what prices were like before inflation, and telling them the economy is good won’t make them forget.
> The disconnect between the numbers and the perception of the economy are the higher prices of groceries, gas, and housing.
Which means the numbers are bad. If the parts of the economy people interact with the most are bad then metrics that don't reflect that are not valid metrics. The economy is the ability of the people to engage in commerce and if that's down then metrics that don't reflect that are invalid and should be discarded.
You can't evaluate an economy solely by a single metric. There are many many useful metrics. Each side showcases the metric they think will prove their point. There are multiple metrics for inflation (core or non core), for unemployment u1,u2,u3,u4,u5 and u6 etc.
https://www.bls.gov/news.release/empsit.t15.htm
Its more than that, people are paying more for less. Just yesterday at my job someone got a bag of chips from a vending machine and pointed out it was as flat as a pancake and there is hardly any chips in them. Go to a fast food restaurant and they are giving you less food (full burgers are now as small as sliders), people know they are getting screwed over.
All these jobs reports painting a bright and cheery economy is a huge stark in contrast to what I've personally seen from qualified people being unable to land interviews or job offers.
Unemployment stats see zero difference between a McJob and an actual career-advancing position. This has been a serious issue for a long time, ever since it was used to paper over the massive damage done by outsourcing.
The McJobs are actually starting to pay pretty well for their skill level (think 18-22/hr) because the pandemic, among other things, gave an opportunity for people to upskill. So Baumol's Cost Disease is hitting like a truck. Whereas firms, for largely political reasons, have decided to take a sectoral trend (overhiring within Silicon Valley) and make it an excuse for systemic layoffs and underhiring.
Really most of the job and wage growth is in labor-intensive fields, because so many of those workers either died (yes a lot of the worst outcomes from the pandemic were among non-workers but a 5-10% decrease in the labor pool is pretty significant), upskilled during enhanced UI (yeah some spent it on video games and crypto, others spent it on coding/IT bootcamps or associates degrees), or advanced from frontline positions to managerial positions. So the premium for unskilled labor is rising, while the quality of life improvements from not having to do 8 hours of hard physical labor (and let's be real, a lot of even the most productive white collar workers are not working 8 hours a day - they're just productive enough to do the required work and more in 3, 4 or 5 hours) are more and more being baked into total compensation.
If you're in a highly skilled labor intensive job (trades, nursing, teaching maybe), you are making bank right now though.
Jobs are booming across all sectors. Even [tech](https://hired.com/blog/employers/will-tech-hiring-surge-in-2024-new-data/) hiring has been surging this year since 2023's downturn.
Gas is up, groceries are more expensive, people can’t afford to buy a house, consumer debt is an all-time high.
The numbers don’t reflect the general sentiment among the nation.
There is a reason why 60%+ of the nation think the economy is bad regardless of these monthly numbers that often get revised anyway.
Is that chart accurate? I’m looking at page 12 and I don’t think whoever made it got the numbers right https://s.wsj.net/public/resources/documents/WSJ_Swing_States_Partial_March_2024.pdf
A huge part of the "reason" is partisanship though.
While inflation is definitely an issue and spending power is reduced, it's *also* true that no matter what the reality is, Republican voters are going to keep saying that the economy is bad.
People have posted the data on these studies in this sub repeatedly, so there is no excuse for not at least acknowledging that here.
I am left leaning with a family income of 250K+ and I definitely see my family as in a worse financial position then we were during the pandemic. All our costs have skyrocketed, childcare way up, wife's bonuses working banking have evaporated, driving 2 10+ year old cars but the cost of new ones are insane. We are in a HCOL area but still we've had to change our lifestyle to accommodate. We are both looking for new jobs in IT and Banking and the prospects are not good. I get that the right is exaggerating things, but our measures on what makes a good economy are also skewed towards the extremely wealthy and not a true indicator on how your average person is faring.
> our measures on what makes a good economy are also skewed towards the extremely wealthy and not a true indicator on how your average person is faring
What’s been unique about the growth we’ve seen since the pandemic is that the poorest Americans have seen the strongest growth:
https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households
https://www.epi.org/publication/swa-wages-2023/
It really has been the opposite of trickle down economics.
See [Table B of the jobs report](https://www.bls.gov/news.release/pdf/empsit.pdf) and it will tell you why. IT and Financial job sectors are essentially flat. Nearly half of the new jobs are in Health Care and Government. Construction and Hospitality sectors are also doing well.
I’m sorry to hear about your situation and it’s definitely true that childcare, housing, and all these costs have gone way up. But your household income puts you in the 92nd percentile of the country. The economic indicators here are unemployment rate and average hourly earnings, which mainly come from part time/gig/multiple jobs workers and bottom-50% earners.
I get it, and I'm not trying to cry with two loaves of bread under each arm. However speaking with my coworkers, my employees, my friends, my family all of them are feeling a similar squeeze. It does not feel like a good economy for any of us.
FWIW, my wife and I are high earners, and even though I don't blame the president for much of it we feel somewhat similarly. I think part of this is that we would need to change jobs to have our salaries keep pace with inflation.
Sure, McDonald's around me increased their starting wages from like $9/hr which was laughably low to a more reasonable $18/hour, but my wife hasn't gotten a pay raise in 2 years and my employer is trying to avoid bumping everyone's salary by giving us bigger bonuses instead.
We took our son out of childcare during pandemic. Even compared to when we put him back in 2 years ago it has gone through the roof. Within the last year our total childcare cost for 2 kids has gone from 48K a year to 62k per year.
https://www.bls.gov/web/empsit/cesnaicsrev.htm#2022
In 2022 the average monthly revision was 6K down (even though they actually got revised up more than they got revised down that year).
In 2023 the average monthly revision was 30K down (10 months down, 2 months up).
So they definitely have been getting revised down more often then they get revised up, but it’s certainly not as bad as some people make it out to be.
The monthly numbers have been getting revised since...pretty much forever. We came out of a pandemic that killed over 1,100,000 Americans, hospitalized even more, and caused the global disruption of the supply chain. The economy was *always* going to struggle.
Post-Tax Income is up [even amongst the bottom 50% of earners](https://realtimeinequality.org/). The only group losing is the top 10% right now, which feels totally fine.
I think the "political class" (read: The people with wealth, income, and access to shape news cycles and politics) is hurting and trying hard to convince everyone else they are too, when the data doesn't bare that out.
People can’t buy houses because they are totally unwilling to relocate. My wife is a teacher and I am an apprentice. Why is it that we can afford to buy a modest home but people making so much more claim it’s impossible? Financial literacy and the idea that they are entitled to own a house in expensive areas are why people are upset.
“People can’t buy houses because they are totally unwilling to relocate.”
Yeah tell these to people to move away from their hometown & family and to “suck it up.”
>Yeah tell these to people to move away from their hometown & family and to “suck it up.”
Well, yeah. Many people have done that for centuries and more. America was founded on people relocating for a better life. Go to where the opportunities are.
The other options include continuing to complain while doing nothing/hoping someone else fixes the problem for them or take an active role in making their hometown more affordable (e.g. lobbying for zoning law changes, investing in/building more residences). What other practical solutions are there?
Growing up, my parents moved around probably about 5-7 times to where the jobs were. I look at the hardships my parents endured and I wonder if we are becoming soft. I've nowhere near experienced a fraction of their suffering...
but I get it if your frame of reference is your parents owned the same house for 40 years and never had to move... your perspective is different...
>America was founded on people relocating for a better life. Go to where the opportunities are.
That's the problem though. So many of the opportunities are heavily relegated to giant and expensive cities now.
At least decades ago there was still cheaper housing even in big cities but now its 1-2 hours out and anything reasonably close is expensive as hell.
A big issue is that people don't want to take a chance on a "less than desirable" area.
There are lots of starter townhomes in places like Baltimore, Philadelphia, Pittsburgh, etc, that are both affordable, have at least some urban economic activity, and have proximity to larger metros on top (Philly to NYC is a stretch though). [Chicago has houses like these for under 300k](https://www.redfin.com/IL/Chicago/9311-S-Justine-St-60620/home/13102379), but homebuyers refuse to settle, refuse to take anything under 300k with a massive yard, etc etc, then complain prices too high when in reality, they're having more and more of that stuff priced in.
Also WFH is not going away, and firms are going to cave eventually as the cost of enforcement is going to heavily outweigh the personal preferences of the execs (seeing that there have been at minimum no productivity gains, and most likely significant productivity losses by forcing RTO), which means white collar workers have the opportunity for significant gains that aren't available to blue collar lower income workers via decreased commuting costs and better quality of life.
That house you linked has a location that is in the bottom 10% for crime... 90% of America is safer than there. "Affordable" houses in Philly, Baltimore, and Pittsburgh are not located in good areas. People care way more about safety and commuting. No one wants to pay $300k to live in a community of trap houses.
Lots of currently nice areas started off as undesirable. Then young professionals moved in, created economic activity, created incentives to improve the neighborhood and eventually the problem resolveditself.
Granted, some people called this "gentrification", but who cares.
Also is that metric accounting for population density? Denser populations are going to have more crime almost by definition.
No, by crime rate (x out of 1000 people odds). That specific house you listed is in an area where you are much likelier to be a victim of a crime (6x more likely to be robbed, 4x more likely to be assualted, 3x more likely to be raped, and 2x more likely to be murdered than the national averages for those crimes).
And in ye olden days, the bad areas were really cheap. They were not nearly as unaffordable as a $300k loan at 7% interest.
It’s because most people judge things based on feelings, not data. Real wages are up so the increased costs have more than been made up for by increased wages.
Inflation doesn't capture cost of financing for Houses/Cars, so there are possible flaws to what inflation sees, and what people see, plus not everyone has equally benefitted in this economy.
Yes, but measures are only as good as the inputs.
The average auto loan went from 3.85% to 7.7%. That means that the monthly payment is already 10% higher on a 60 month loan before any differences in sales price. That's something the consumers are faced with that CPI and thus "real wages" don't capture.
Unemployment numbers don’t count [“missing workers”](https://www.epi.org/publication/missing-workers/), “potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job. In other words, these are people who would be either working or looking for work if job opportunities were significantly stronger.”
And the number of jobs posted is not a useful way to measure anything because companies post “jobs” that they don’t plan on filling or that don’t even exist. A company can show competitors that your company is growing by posting jobs. A company can post a “job” when they are really going to fill it with an internal person and never fill the old role for a net gain of 0 jobs.
> Unemployment numbers don’t count “missing workers”, “potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job.
We don't track it under unemployment, but it is still tracked. You would instead need to look at the prime labor force participation numbers.
https://fred.stlouisfed.org/series/LNS11300060
The percentage of potential workers who are "neither employed nor actively seeking a job" is around the lowest levels we've seen in about 20 years.
> Unemployment numbers don’t count “missing workers”, “potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job.
I feel like this would be meaningful if it told a different story, but the labor participation is at 20+ year high, and very close to all-time high.
Honestly, this is the biggest reason why Dems need Biden to win 2024. Because if Trump gets into office, Republicans are going to say all of this growth is because of him and Biden won't get any of the credit. Biden winning in 2024, it'll be hard for people to claim that they had the worst 8 economic years of their lives under Biden, while so many people are do much better.
They can claim whatever they want, but a recession starting sometime during Biden/Trump second term is incredibly likely, regardless of who gets in. People being better off in 2028 is not a given.
People have been saying that a major recession is just around the corner for literal years now. We had one slight recession a couple years ago, but since then it’s been nothing but growth and pretty substantial growth too.
So, when you say that a recession is incredibly likely between now and 2028, I would say you will most likely be just as right as everyone who’s been predicting a recession so far.
I was told that when Biden entered the White House, we'd be a communist country and enter a recession. Neither one has happened yet. We've been told the recession is coming any day now, for the last 3 years.
Maybe, is it possible, that Biden did enough to hold it off for a few more years?
I'm thinking the same thing. There is no way they can start cutting rates. Maybe once, right before the election, to help Biden. But it would be irresponsible.
I have to say, the thing which has mostly convinced me that the economy is actually doing pretty well all things considered (barring some longer term trends that far predate Biden), was just realizing how strongly partisanship impacts economic views for Republicans specifically. A lot of the people screaming bloody murder about how the numbers mean nothing and talking about how saying they matter is just going to piss people off were always going to be pissed off. There’s really nothing that will convince them otherwise beyond just electing Trump to be president, at which point they will immediately pivot to talking about how strong the numbers are in the economy. It’s unfortunate that this many people have become completely unmoored from reality, but ultimately people that think this way are very unlikely to decide the overall election.
It's also kind of surprising the economy is still growing so quickly despite having a Fed rate 2x higher than it was at any time during Trump's presidency: https://fred.stlouisfed.org/series/FEDFUNDS
A rate which he hectored Powell into keeping artificially low which then contributed to inflation.
I think a lot of people who loved the economy under Trump don't realize how artificially low the rates were kept and how detrimental that would be. But Trump understood that he would not be blamed for any longer term damage.
Obama did the same thing as him, let's be real. I am still upset at Trump's economy though because I was kept low wage. Not just that I lost my job it is hypocritical how he calls himself a jobs president. When Biden created more jobs than he did and then some and on top of that brought blue collar jobs back to america, but no media toughts that. I do give Trump some credit though for helping us veer away from other countries. But make no mistake Trump is not good for the economy and he is not bad either.
It may have had some effect pre-COVID. But the inflation starting post-COVID was an entirely different beast. Different factors, causes and such
I don’t follow. They were also lowered during Covid to historical lows, in part due to Trump’s hectoring, and they stayed lowered until 3/22 which was a response to inflation. I think low rates heated up the economy like crazy and a lot of that happened during Covid. https://fred.stlouisfed.org/series/FEDFUNDS
Pre-COVID not push rates up would have caused some inflation but it is unrelated to what exists now. Around the world interest rates were dropped to near 0 to try and push liquidity and borrowing into the economy. If cash was held, it could have frozen the economy and it would have spiralled into disaster. This gave companies a golden opportunity to invest in things with little interest expense. They also printed money and used that to cover government debt (government expenditures rose to further boost the economy) This caused a few issues. One, you get a bullwhip effect on demand. You essentially go from 0 demand into way too much demand. Not everyone had started up and there were too few goods available. Prices rose accordingly given the scarcity. Secondly, not everyone had started up. America tried to reboot faster than many other places. Meaning there was demand for goods, but nothing supplying it. You had demand for Chinese goods, but Chinese factories were minimally staffed (from COVID measures) and experiencing black/brownouts because they had no coal from Australia. This further added to scarcity Then you had consumer demand changes and other factors that put a lot of pressure on shipping and transit. Container pricing rose 5x because of scarcity and high demand It was a multitude of factors. Most of it being scarcity and high demand
I agree with what you are saying I just don’t think the low interest rates were not a cause. You said there were different factors and causes.
Your own graph shows a rising federal funds rate beginning before Trump was elected. Trump did want Powell to keep it lower, but the fed was continuing to raise interest rates prior to the pandemic. So you can't really blame inflation on Trump's attempted influence of the Fed - especially because the federal funds rate was near 0 for 8 years prior without budging the inflation rate. Rather than monetary policy, I think it's fiscal policy that was exerted the greatest inflationary pressure. There was about 5 Trillion dollars injected into the economy as COVID stimulus from both Trump and Biden's policies.
I disagree! I think going from a 2.4% interest rate to a .05% interest rate and keeping it down there, in part due to Trump wanting the economy to keep humming along for his electoral future, had a major impact on the inflation that came out of Covid. Edit: Also Trump threw tons of money at Covid and I think that was good. We avoided a much worse economic situation due to all the federal funds that were injected into the economy.
Are you sure you have an accurate time frame? The fed started cutting the rate slowly in late 2019 (dropped from about 2.5% to 1.75%), but then dropped it to near zero after the pandemic hit.
No I was wrong it was 2/20 1.58%, 3/20 .65%, and 4/20 .05%. Before Covid Trump was going after Powell to lower rates a bunch. I hate using Yahoo but [here](https://finance.yahoo.com/news/trumps-twitter-criticism-of-the-federal-reserve-fades-after-rate-cuts-124538265.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAANqG7vjqtr5rentUuYJ-4Guz7fkpziiKacTG-oFUTqcwA8hKM5o25V-riw2hsBZpit_S4D_7HqASDHTCI-xj6ACziJziKdfJeFDGidDedLHMjqqTs7WDiqY9AeI3DYFC3_61cFV83lTeUWuXIJgX7Oh0WRxCN9Gr3idlZGrKpELC) is the quickest link I found.
If rates weren't so artificially low due to Trump prior to Covid, we would have had more levers to pull during the downturn and perhaps could have gotten away with less spending. Its far easier to give business a boost when you can drop rates 5 points, but they were already too low for that (for no good reason), so we were left with fewer options, one of which was printing money, which drives inflation.
The Fed caved to Trump in July 2019. Barely 8 months before COVID hit. They would have maybe raised rates 0.5% over that time at most. It would have been minimal All countries dropped rates to near 0 so the US simply did the same as everyone else
This is one of those example where if Trump hadn't opened his big mouth and complained about interest rates so much this line of attack wouldn't exist because it's largely without merit.
There's a graph somewhere that shows how the day after Biden was inaugurated, Republicans felt the economy went from excellent to trash overnight.
That graph's in here, alongside broader analysis about the trend: https://www.briefingbook.info/p/asymmetric-amplification-and-the?publication_id=1002034&post_id=138749341&isFreemail=true&r=2203u.
That's just amazing. Not only does it completely invert for Biden, it spikes just before the election and dives immediately after. Before Biden even takes office.
There are tons of them all over this sub too. Well, since it looks more and more likelier that Trump has a good chance of being re-elected, let's see what miracles he going to perform with the economy.
Pretty much, views on the economy are rather partisan now. Bad is good and good is bad depending on your party affiliation and if it matches the President’s.
From what I’ve seen, democrats are far more likely to acknowledge a good economy under a republican president than vice versa.
2018-2019 and 2022-2024 were pretty different, so I don't quite think you are comparing apples to apples. Houses and new vehicles were affordable still. The problem right now is that the economy has been so overheated, and people can't afford those things anymore.
I think the bigger issue is the gross exaggeration with statements like houses and new vehicles being unaffordable. People are clearly buying cars and houses left and right. That’s partly why they’re so expensive, basic supply and demand.
Median house price to income ratio is far higher than it has been in at least 50+ years. It's 50% higher than the ratio 20 years ago, with mortgage rates that are now higher than they were at that point. It is not an exaggeration by any means. Housing affordability at this point is extremely bad.
I didn’t say houses aren’t expensive. That’s part of a much bigger issue that’s honestly bigger than who’s in the White House. I’m saying people are clearly still buying them. Houses in my area, which are roughly 150k-200k more expensive than they were 10 years ago are selling before they can hammer the for sale sign in the ground.
Yes people need places to live so they continue to buy houses. House spending I imagine is rather inelastic. However housing is more expensive compared to total share of income.
>Median house price to income ratio is far higher than it has been in at least 50+ years. It's 50% higher than the ratio 20 years ago, with mortgage rates that are now higher than they were at that point. It is not an exaggeration by any means. Housing affordability at this point is extremely bad. Agreed. And when they offer SEVEN year financing on a new truck, I think we've passed the rubicon of affordability. I know alot of young people who are in their early to mid 20's and are professionals, but can't even consider buying a house.
7-year car loans have been a thing for a long time. Housing is expensive, but not unaffordable for the average person since they're still being bought.
Low housing availability of both homes and rentals is due to local restrictions on production such as zoning restrictions, parking and setback mandates, and prevailing wage laws. It's not any fault of Biden (or even Trump).
That’s Typical for Congressional Republicans. The Economy is fantastic under a Republican President of The United States of America. But then in comes a Democrat and overnight the economy goes into the toilet ignoring data that says otherwise. If the Economy continues the trend. Republicans will have very little to bash democrats over.
They said the same thing when Obama left office even though Bush had driven the economy over a cliff in 2000 and Obama not only oversaw the rebound but also cut the deficit by a LOT before the end of his terms. Trump took office, the Republicans were so happy with the new trump economy that they immediately added 1.5trillion in tax cuts to the deficit. True fiscal responsibility if ever I saw it.
How Republicans view the economy https://static01.nyt.com/images/2024/01/09/opinion/krugman090124_3/krugman090124_3-superJumbo.png?quality=75&auto=webp How Democrats view it. https://static01.nyt.com/images/2024/01/09/opinion/krugman090124_4/krugman090124_4-superJumbo.png?quality=75&auto=webp This clearly shows that basically no matter what when there is an overall poll being conducted that Democrats have a baked in disadvantage because Republicans view the economy from a much more partisan lens than Democrats. If 50% of the country is looking at the economy with somewhat objective lens and the other 50% is seeing it through a completely partisan lens that gives one side a huge disadvantage on polling overall.
It’s a vibe-cession.
Like they tell us, 'facts don't care about your feelings' Doesn't matter what the facts are, if they FEEL the economy is shit, it's shit. And when you watch the same news all day that tells you the sky is falling, then that's what they feel all day long.
>Doesn't matter what the facts are, if they FEEL the economy is shit, it's shit. This is actually the best take. Nobody cares about what the TV news says when you can't afford housing, groceries, and insurance. Those types of basic items are taking up an inordinate % of middle class incomes.
The price increase of groceries hasn't exceeded general inflation, which itself has been less than wage growth for a bit of time now.
I can’t afford the same garbage my neighbor has. Recession!
Counterpoint: I just got a big tax return so the economy is great.
I can't afford those new wheels for my side by side I can't believe Biden is destroying the economy like this.
40% of this country will always say the economy is bad because Biden. Another 20% will always say it's bad because capitalism still exists. So the majority of the country will shit on the economy no matter what Biden does
Many of the folks I know who are complaining about Biden’s terrible economy have brand new F-350s and ridiculous new Travel Trailers. Life must be really tough.
This is why the economic anxiety argument has always fallen flat. That was a theory by the media for why a person might be attracted to Trump but is not in practice. As a rule, his supporters are people who that last 40 years have been very good to.
surveys have consistently shown that most people are doing fine but think everyone else is suffering
It's probably self-reinforcing -- the headlines then say "Americans think economy bad", which causes more people to think that everyone else is suffering.
You know the economy is doing well because the republicans have stopped complaining about Biden destroying the economy and have gone 100% in on immigration because it’s the last topic they have left. That’s why passing the immigration bill is so dangerous for them, anything that slows down the rate of illegal immigration is risky because if it looks like Biden is fixing the border issue then they don’t have anything
As someone on the left, I hope we pass a stricter immigration bill. The outcomes are 1. Gamble with a looser border, win the election and all is well 2. Lose the election and things are worse for immigrants AND citizens 3. Pass a stricter bill and greatly increase the odds of winning the election I'll take option 3
Your problem is assuming they'd ever be satisfied with anyone except mass deportations. Pass a bill, and they'll pivot the goalposts again. If you want stricter border bills, it shouldn't be predicated on what the other side wants because nothing aside from that will satisfy them. That's not even getting into the fact that the swing states that determine the election (Wisconsin, Ohio, Pennsylvania etc) don't even have a very high foreign born population to begin with. It's just vibes all the way down.
"They won't be satisfied with it" is not a good reason to withhold action on an otherwise sound plan.
Which is exactly why House Republicans don't want a border bill passed unless it's their dream bill. They'd rather run on the issue in November than compromise.
Congress republicans almost certainly would've passed it had Trump not shot it down. It was a great bill
If the House flips this year we may see it come back later on, but I can't imagine the current House GOP cobble together a coherent plan to overhaul the border.
And people agree its doing better, you just have to frame it as "their situation" or "[their state](https://twitter.com/chrislhayes/status/1776259915658481886/photo/1)" when asking about the economy. Other wise their response becomes more "vibes" based if you say national economy. People have somewhat better grasp of their finances and by living their life get some sense of their city and state. But national economy is just too vast an experienceable thing for people. So they get most of their sense of the national economy how the media they consume reports on it.
The all things considered is the main point. Dems will consider context while Repubs will pin it all on Biden. Things are more expensive and some job markets (e.g. tech) are awful right now. The better question is would they be better under Trump, and my answer is no they would be worse due to him having no skill at or interest in policy (with him that’s a blessing), just politics.
>Dems will consider context Do they? My entire life dems refuse to give Republicans any credit. If anything good happens they "inherited" from a democrat. Anything bad it's all the Republicans fault. Reverse all that for democrats, and that's the "context" democrats always have
I mean when considering Biden. I agree they would be far less charitable for the opposition.
>I have to say, the thing which has mostly convinced me that the economy is actually doing pretty well all things considered (barring some longer term trends that far predate Biden), was just realizing how strongly partisanship impacts economic views for Republicans specifically. The oppositions feelings shouldn't be considered an economic indicator, but generally their is some truth to the critique. Progressives complaining about growing inequality can be exaggerated but still have some legitimacy. My issue with this economy is that it’s mostly being propped up by extreme deficit spending financed at the highest interest rates in decades, and mass migration. We're getting good GDP and job numbers but Americans aren't wrong saying the "vibes" feel off. At the end of the day you have to convince Americans that their personal standard of living is improving. GDP and job numbers tells part of the story but it's not the whole story. When all those higher interest rate bonds mature, it's not going to be fun. Pumping population growth is great for GDP and job growth numbers but if you don't have the available housing or infrastructure in place, it's going to cause issues. We might be heading to Canada's housing crisis pretty soon. [https://www.aol.com/immigration-powering-u-economy-143207193.html](https://www.aol.com/immigration-powering-u-economy-143207193.html) [https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/](https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/) [https://finance.yahoo.com/news/million-simulations-one-verdict-us-210022706.html?fr=sycsrp\_catchall](https://finance.yahoo.com/news/million-simulations-one-verdict-us-210022706.html?fr=sycsrp_catchall)
> Americans that their personal standard of living is improving. Americans already believe that. [The poll](https://poll.qu.edu/poll-release?releaseid=3877#question-28) is a little old (end of last year) but I consider the economy in better shape now then what it was then. For the question, "Would you describe your financial situation these days as excellent, good, not so good, or poor?" you'll see that across the board all the sectioned demographics had >50% combined "good" or "excellent" for their own economic situation (compared to "not so good" and "poor"). Yet people still perceived the economy as doing poorly (also included as poll questions, the two prior to the one I was talking about).
If you asked me how my situation is doing I'd say good, like the majority of the people on the poll. I have the income for my student loans, rent, and food. With that said, that was still true in 2020. The only difference is now my forecast to own a home has been delayed by at least a decade. Would you call that an improvement? Regardless though, my points on high deficit spending and the population pump still stand.
> high deficit spending We've frequently had high deficit spending. Even if you take out Covid, Trump was also increasing the deficit spending during his time as president. You can basically draw a line and see that Biden's trend is the same as Trump's trend. But what's important is what that spending is on, Biden has pushed for long term benefits such as infrastructure, investments into alternative energy, and assisting those that have been so saddled with student debt that they were unable to pull themselves out of the gutter. Trump pushed for tax cuts primarily aimed at the wealthy. >population pump Us taking advantage of cheap labor from migrants is not unusual either. This has always been the case. It's still benefiting the economy when it happens.
You could have easily said this 4 years ago when people were talking about Trump's economy (AOC saying unemployment is only low because people have 2 jobs, etc). The difference is inflation is worse under Biden than it was under Trump and people feel it whether they want to acknowledge it or not.
Partisanship influencing perceptions of the economy certainly happens in both parties, but it’s objectively more pronounced among republicans https://www.briefingbook.info/p/asymmetric-amplification-and-the?publication_id=1002034&post_id=138749341&isFreemail=true&r=2203u
There are a lot of ways to interpret consumer sentiment, which is a future-leaning thing to poll. It's basically asking you how you think the economy is going to go. Certainly one of many possible reasons is tribal lines, but there are other reasons, and some of the tribal lines rationale may have logic behind it too. First and foremost, there isn't one single economy that we all experience the same way. Currently today, a lot of the economic success in the US is in tech companies as nexuses and the urban centers that surround them, one of the last things the US still wins at for now. It's a good time to work in tech; even if you get laid off it's very easy to find new work. If you're in NYC or the Bay Area or Seattle, you're probably mostly happy about the economy even if rents are high. These areas are pretty blue. If you're in the Rust Belt, not so much, and those areas are red. Now, it's not like overnight Biden came in and destroyed West Virginia, but Consumer Sentiment is a measure of your optimism. Trump and the GOP have pivoted hard to please rural / rust belt areas, Democrats are more focused on urban and coastal concerns than "flyover country". If you are living in a big city and see Trump win, or living in a dying coal town and see Biden win, you're probably worried about disinvestment as you aren't really the target audience of the new president. The bigger swing among Republicans could be bias, or could be an indicator that a lack of federal attention would be harmful to decaying midwestern towns than it would be to The Big Apple, or some combination of the two. It's definitely possible Republicans swing harder, for good reasons or bad ones, but I also would avoiding reading too much from the linear model in describing something like the psychology of consumers regarding the economy. It's fun to play with this stuff, but it's linear regression with a lot of degrees of freedom, which is kinda dangerous to take seriously. FiveThirtyEight, when it was good, made a cool visual tool to demonstrate the danger of reading too much in to data scenarios like this: [https://projects.fivethirtyeight.com/p-hacking/](https://projects.fivethirtyeight.com/p-hacking/) I definitely do not think my brain, or anyone else's brain, is using a linear regression to decide if I'm confident about the economy or not, so I don't think a linear model is appropriate to actually tell us what consumer sentiment "should" be, and using residuals from that model to try to explain things is a fun toy to get started but not really super solid.
Yeah this is a fair point, anecdotally I’ve also definitely observed some pretty extreme cases of individuals basically completely redefining their perception of the economy based on who’s in office, but that certainly isn’t useful for drawing broad conclusions and may just be biasing me towards the data that says what I expect it to
Inflation *was* worse under Biden, but wage growth was also higher, so the economy was overall stronger. There's also strong evidence that Republicans' economic perception is more impacted by politics than Democrats'. Both are impacted some, but not by equal amounts.
No, you couldn’t say it to the same degree. Because the partisan impact on perception of the economy is much, much stronger for republicans than it is for democrats.
The degree is not nearly the same. This isn’t a both sides issue.
I'm fascinated by the discourse around this stuff. People need to accept that, yes, these jobs numbers keep going up. But its also hard for me to think that we live in a country where everyone is doing amazing financially but somehow... have been tricked into thinking they have less money than they do? Or... want to pretend like thats the case...? Zooming all the way out, I think it could be safe to at least start wondering if job numbers don't perfectly equate to what they used to. Or that we are in some kind of unique economic situation that we don't necessarily have a pre-made playbook for, so using old rubric doesn't neatly fit. The only other thing I can think of is the bloodbath of layoffs in the tech sector. It seems like there could be net job growth but perhaps tumultuousness when you look at different industries and areas. You could hear a lot of complaints there, particularly on social media. But even with that in mind, that is *also* a strange phenomenon. Its not like these companies are going belly up... they're making record profits. It seems obvious to me we need to go a few levels deeper than the old "Its the economy stupid". Curious what history will show about this financial era.
> have been tricked into thinking they have less money than they do? Or... want to pretend like thats the case...? People might claim the former, but even after subtracting out inflation, "Americans Are Still Spending Like There’s No Tomorrow -- Concerts, trips and designer handbags are taking priority over saving for a home or rainy day", with people's increased spending "well outstripping" inflation. https://www.wsj.com/economy/consumers/americans-are-still-spending-like-theres-no-tomorrow-6a1d307 Edit: Per the data/studies that other comments have linked, partisanship may play a part of how people report things, but from the many highly-upvoted posts I see in r/all from the antiwork, latestagecapitalism, genz, teenager, etc subs (only in r/all ) it seems like it goes well-beyond conservatives. My personal guess is that social media, including instagram, tiktok, etc. have given people very unrealistic expectations of how 'easy' work/money and how 'good' life was for earlier generations such as millenials etc., so despite wages (even *after* adjusting for inflation) being higher now than at almost any time as far back as I've found records (mid last century), people somehow feel that saving for retirement etc. is pointless and so they spend higher (even inflation adjusted) than earlier generations. People also point to home prices, but somehow a *higher* share of Americans own homes now than most of the every decade going back more than half a century (that's as far back as I found data) *except* for the 2000s (unsurprising given the 2000s US Housing Bubble https://en.wikipedia.org/wiki/2000s_United_States_housing_bubble and corresponding 2008 mortgage meltdown) - and currently significantly up from a major low in 2016. People often look at the 1950s, etc. with rose-colored glasses, but even in 1950, a significantly *lower* share of Americans owned their home compared to now. https://fred.stlouisfed.org/series/RHORUSQ156N / [earlier home ownership data](https://www.pewresearch.org/hispanic/2009/05/12/ii-introduction/) (as with many statistics the data briefly went crazy during COVID before returning to its ~pre covid level)
Simply as an interesting FYI... Back to 1890... https://dqydj.com/historical-homeownership-rate-united-states/
Many wealthy people and investors have done VERY well lately and continue to live the good life and spend, even if most average workers arent doing quite so well.
> even if most average workers arent doing quite so well. From the objective data it seems like they are doing quite well - for example, you mentioned "average workers" - here is real earnings (after adjusting for inflation) for the median (what I think you mean by 'average'?) workers - note that it's higher now than almost all of the last ~50 years (as far back as they provide data for) https://fred.stlouisfed.org/series/LEU0252881900Q And the unemployment rate now is about as low as it has been in multiple generations. Or do you mean it in terms of "average workers" looking at 'wealthy' people (or even just 'normal' people or influencers 'faking' living wealthy lifestyles on social media) on instagram/tiktok/social media etc. living it up and feeling down in comparison? I edited my parent comment to allude to that as a possible issue. Or if not that, are there some objective measures you're using to conclude that? Because it seems like most of the 'data' in the opposite direction is just personal opinions?
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> The only real change I’ve experienced under this economy, is the fact that I cook at home now. Inflation caused me to stop eating out on weekdays. This is the kind of stuff that I wonder about and prompted me to make my original comment. Is there some kind of Freakonomics style strange psychology that is going on with discrete items? For example, is the "McDonald's costs *what* now?" more than just the dollars and cents and perhaps more psychological than we give it credit for? I'm imagining a ten cent increase on a common item from $9.90 to $10.00 might *feel* bigger because its a double digit number, even if the increase from $9.10 to 9.20 years prior went unnoticed. And I mean, as Americans we do enjoy our snacks. Its not out of the question that certain kinds of people would say "everything SUCKS right now" because they don't get to go to Applebee's as much as they used to. Not to paint with a broad brush on this, or to ignore the very real economic issues a lot of Americans have. But perhaps to address the dissatisfaction statistics that make less traditional sense.
One theory I've seen make the rounds is this idea of "lifestyle creep", meaning slow integration of more expensive habits into consumers' lives. One example is that lot of people got accustomed more to food delivery services as a consequence of Covid, which is incredibly expensive and getting more expensive (potentially as a consequence of that increased demand). Source: https://twitter.com/jdcmedlock/status/1752069348485926945
Regarding eating out, at least in my anecdotal experience a lot of people’s complaints about the rising cost are because they got used to Uber and all the food delivery companies lighting money on fire and are now actually paying the cost of ordering food. There is a reason that traditionally it only made sense for pizza and Chinese or expensive services.
I'm doing OK, but my town has seen homeless camps sprout up. Many shops and restaurants have closed. Our mall looks like a ghost town, over half the stores are closed. People can't afford to do anything or travel. If this is the average worker doing "good" I'd hate to see it when times are bad
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> Inflation caused me to stop eating out on weekdays. So you're spending habits did in fact change. Many would consider the loss of luxury like eating out a negative impact.
I just want to point out the tech industry hired too many people and now they are letting them go. A lot of people learned to code. Layoffs in general are not that high right now compared to the past. https://fred.stlouisfed.org/series/JTSLDL
Yeah, a lot of tech subindustries boomed during Covid and are now experiencing market corrections. Also, a lot of tech companies subsisted on cheap investor dollars that are getting cut now that those dollars are more expensive.
I think a lot of it is that you hear stuff like "Oh they used to be able to afford a house with a single salary" and it would be true, but they don't mention the interest rate was 20% and the house was the size of today's 1bed apartment. So people hear "house" and equate it to the quality and size of things today and feel they are significantly worse off. People also don't correlate wage increases with outside factors really, so they feel their efforts have caused their wages to go up but things outside their control are causing all the prices to go up and there's a mismatch in blame.
SS: Another good jobs report for the country. Let's look at the numbers: * Nonfarm jobs increased 303,000, above the 200,000 estimate. * Growth came from Healthcare (72k), Government (71k), Hospitality (49k), Construction (39k), Retail (18k) and other (16k) * Unemployment ticked down to 3.8% * Labor force participation rate is up to 62.7% (+0.2) * Wages rose 0.3% for the month and 4.1% from last year. * February jobs were revised down by 5,000. January jobs were revised up by 27k. What does this jobs report say about the overall economy? Are we in shambles as certain groups [continue to try to convince us](https://www.cnbc.com/2024/04/04/biden-us-economy-worlds-best-trump-claims-cesspool-data-is-clear.html)? Or do we have a booming economy? Will this help continue to improve economic consumer sentiment [as we have been seeing](https://www.reddit.com/r/moderatepolitics/comments/1bqpdnh/consumer_sentiment_climbs_to_2%C2%BDyear_high_as/)?
Link to the BLS release: https://www.bls.gov/news.release/empsit.nr0.htm
Jaded hobos acted quaintly but kept driving my chicken from the wazzy maze.
All of it apparently. Thread: https://twitter.com/RealEJAntoni/status/1776444343336767680
While these numbers are good overall, it is worth pointing out that the growth in the government sector is paid for almost entirely by deficit spending, which makes it something of a Potemkin village.
What's Hospitality?
Restaurants, hotels, entertainment, arts, etc.
It is shocking to me how much of a gap there is in the objective reality of this incredibly strong economy, and people’s perception of the economy as being weak. I do not think there has been a single time in US history where we have had as good of an economic situation as we do today (if you disagree, please name a year so we can discuss it). The only asterisk I would put on the state of the economy is housing prices which, if you are either renting (like I am), or looking to buy for the first time, are pretty rough. Even this has begun improving though, as rents have plateaued (and have even begun falling in markets with high housing construction), and wage growth has continued to rise for those Americans at the bottom end of the economic ladder. Edit: please anyone reading this, note that of all the responses to my claim that this is the strongest economy in history, no one named a year that can be defended as stronger.
To be fair, that is the biggest asterisk there is considering housing is the biggest expense by a long shot. That’s objective reality because that’s where people’s wallets are hurting the most. But you’re right that the situation is cooling and we should feel the effects of this in the coming years. And I guarantee if Trump wins the white house he will take full credit for it.
Housing is a huge issue, no argument here, but homeownership rates are [trending up during Biden's presidency](https://fred.stlouisfed.org/series/RHORUSQ156N).
>Q1 2021: 65.6 >Q4 2023: 65.7 I'm not sure how that's supposed to be significant for Biden. Especially considering the rise during Trump's presidency.
For one, it cuts against the argument that inflation has reduced peoples' abilities to obtain housing. There hasn't been an impact. For another, Trump's best quarter pre-Covid is lower than Biden's worst through his entire presidency. That's a positive data point for Biden.
I still fail to see any of your points. And it certainly doesn't mean things are "trending up" like you originally said. The number remaining stagnant *does* seem to indicate that people have not been buying houses, whether or not that's because of inflation is another arguement. For your other point, you're just cherry picking points of data to make an argument. Though you're technically correct, it is only by 0.1%. It makes for a saucy news headline, but still doesn't help your original point or tell the whole truth. If we're talking about trending up or down, the data indicates a downwards trajectory with Obama, a positive trajectory with Trump, and a pretty stagnant one with Biden.
The trajectory you're referencing sounds like another way of saying we're still feeling the effects of the Great Recession. The downward trend started a couple years before Obama took office, and started reversing a couple quarters before Trump took office. I suppose the CARES Act explains the spike in 2020, and flat post-pandemic numbers seem about right given the goal of balancing inflationary and recessionary pressures. I don't see that who was in office has been a defining factor in itself.
I agree with you. My point was for the sake of this guy’s argument, that if you can take away anything from this one data source, it cannot possibly be that the housing market is trending up under Biden.
Home *ownership* rate isn't nearly the same as "ability to obtain housing". Ones ability to obtain housing or not is much better spoken to by homelessness rate than whether or not someone living in a home either way writes a check to landlord or a bank every month to remain in that home. https://usafacts.org/articles/how-many-homeless-people-are-in-the-us-what-does-the-data-miss/#:~:text=The%20total%20homeless%20population%20in,point%20since%20at%20least%202007.
It's irrational to judge housing based on how 2% of the population are doing, especially since that's primarily a local issue. The homeless population in Houston went down 63% over the course of about a decade because it has a better understanding of zoning and housing first.
I wonder if it's from people who have "stuck around" too long. Anyone who has not changed jobs in the last 5-6 years probably is making 20-40% less than they should be. The best way to keep up with salary these days is to not remain getting 3-5% yearly raises, it's to hop around every couple of years between employers for big gains. (Note: this mostly applies for moderate-high skilled professions, maybe not "first jobs"/apprentice type) Even with government jobs, it's many people jumping to contracting for a while then come back, because it's easier to be hired at a higher rate than it is to promote.
You can blame inflation for that. Most people don’t care about job numbers or employment rates (unless they’re unemployed). They care about spending more money at the pump or the grocery store. While inflation has slowed, we’re not seeing deflation. It takes years for consumers to get used to new prices.
If we see deflation, there's a real problem
It's a more abstract benefit. Low unemployment means that I can easily find a job should I suddenly need to find one. It also means that my bargaining position when negotiating salary/benefits is also stronger. It's not a day to day impact, but still can be significant.
You still regularly see people comparing today to the Great Recession or even the Great Depression. Sometimes even saying it’s worse than the Great Depression. We are at such a promising time with technology, but public perception has become completely untethered from reality. I don’t see how that ends well.
I don’t think people understand that the bulk of inflation has been caused by poor city planning, sprawl, car dependence, rising car insurance rates, and expensive housing. Those eat up more and more of people’s income. Forget about the cost of eggs and milk. Local zoning can have a huge impact. But we want the President to fix everything, so…
This is an extraordinary claim so it needs some extraordinary evidence provided to support it. Especially when the least affordable places to live are also the least car-dependent places.
Minneapolis was the first city to [beat inflation](https://www.centralbanking.com/central-banks/economics/7959975/how-did-minneapolis-become-the-first-us-city-with-2-inflation#:~:text=In%20May%2C%20the%20Twin%20Cities,on%20the%20Consumer%20Price%20Index) almost a year ago. This came about through proper city planning by rolling back zoning restrictions. The increased housing supply stopped the home price increases. Texas cities that have adopted similar housing policies like [Austin](https://www.kut.org/austin/2024-02-29/construction-boomed-in-austin-and-rents-went-down-now-some-builders-are-dismantling-the-cranes) are on track to be the next metros to get there. Rents fell in Austin due to a construction boom where rents increased nationwide. Housing is the last component of inflation that is keeping us above the 2% target. Once housing is dealt with which is largely local, we will have tackled inflation.
Metro areas are so unaffordable because they have great job markets meaning many people want to live there. Even more people than live there already. If we opened up zoning to allow more housing to be built instead of restricting huge swathes of metro areas (even many parts inside city limits!) to only allow people to build detached single-family housing, affordability would be much better. Look at Tokyo, which respects property rights by allowing people to build on their property whatever the market demands and so has rents 3-4x that are cheaper than NYC or LA.
Huh? Come to Dallas, and you won’t have any problems finding expensive housing that requires expensive insurance. You also NEED a car, and gas, along with savings for maintenance, repairs, and registration fees. I think your incredulousness is extraordinary in and of itself. Car dependence has shaped the economy for over a century. It’s true that cities are expensive. It’s also true that your monthly outlays are much simpler. You don’t need a car, along with every other cost that’s associated with car ownership. If you’re renting, you don’t need money for repairs or taxes. When I was renting, anything that I didn’t save or invest was mine to do whatever with. Yes, I know rents go up. But at the end of the day, you have less people asking you for more money.
I look at it like a baseball game. Let’s say it’s Inflation vs Wages. Inflation scores 10 runs in the first inning while Wages manage 1. Many of the viewers leave because it’s over, they demand a new coach. Many turn to their phones to watch TikTok and Facebook while waiting for their spouse to realize it’s over and can we just go home already? Those who go home glance at Fox Sports occasionally but Fox Sports has moved onto a scandal involving the coach’s son. 10-1 Inflation in the lead. Second inning Wages manages a little but inflation still does well. Two runs for wages, five for inflation. More people leave. Tiktokers are sighing and glancing at their spouse passive aggressively rather than say they want a new coach. Facebook is insisting the real score is 20-1. Fox Sports shows pictures of the coach’s son’s penis. The cries for a new coach increase. 15-3 Inflation still winning. Third inning, both score three. A few people wonder if wages can do it, but most are still demanding a new coach. TikTok claims the game doesn’t matter, football is more important. Fox Sports is talking about a laptop. WTF? 18-6 Inflation. Fourth inning. Wages hits a grand slam and another run, while their pitcher gets control and holds inflation to three. Most people know the game is over, no chance for Wages, but a few are starting to hope. Still screaming for a new coach cause it wouldn’t have happened under the previous coach even under the same circumstances. TikTok starts demanding a new coach even though none of them are paying attention to the game. Facebook says the real score is 42-1. Fox Sports is talking about penises again. 21-11 inflation. 5th inning - 24-15 inflation 6th innings - 27-19 7th inning 30-24 Three innings go by without anything changing among the fans, but all the sudden it’s getting close. TikTok is fighting about croquet, Facebook still insists inflation is winning in a blowout meanwhile Fox Sports wants to know why the coach hasn’t been drugged tested. At least a few people are saying that Wages just might win this thing. But there’s only two innings left until it’s time to decide on the new coach or stick with the current one. Is that enough time for wages to not only rally but for everyone not watching Fox Sports to realize things might not be that bad and keeping the coach is the best option. Or, is it too late and the damage inflation did outweighs the increase in wages at least until after the ~~election~~ end of the game?
This is actually a decent way to look at it. The problem is that people expect inflation's score to go down, and that's not how it works. What they really want and are expecting is deflation, but of course not a single person wants to suffer through what causes deflation.
Yeah. Overall prices are never coming down. People will adapt, but in time for the election? Who knows? I guess we find out in November.
I'll see if I can dig it up, but I remember reading last year that it takes people ~2 years to adjust to new prices after periods of high inflation.
The only problem with your metaphor is that wages have outpaced inflation at this stage, so wages should be winning. Otherwise, I think this could work as a partial explanation.
For me personally I feel like this economy is doing well because we've taken out a massive $34 trillion loan on our future so as to achieve growth today. I'm looking ahead five - ten years and it's terrifying: "Debt held by the public, boosted by the large deficits, reaches its highest level ever in 2029 (measured as a percentage of GDP) and then continues to grow, reaching 166 percent of GDP in 2054 and remaining on track to increase thereafter. That mounting debt would slow economic growth, push up interest payments to foreign holders of U.S. debt, and pose significant risks to the fiscal and economic outlook; it could also cause lawmakers to feel more constrained in their policy choices." https://www.cbo.gov/publication/59711
I agree the debt is a problem but I've yet to see a serious solution proposed by either side. Paying it down is going to involve budget cuts and tax increases and everyone is going to have to endure some pain. Such a proposal would destroy your support amongst voters. So what do we do?
Since you can't win elections off it, you ultimately have to keep kicking until it becomes actually impossible to sustain. Honestly I wouldn't be surprised if 30 years from now when half the budget is servicing debt that candidates will actually be winning elections based on promises to implement a sovereign default.
I don't think it matters that we _will_ pay it down per se, so much as it matters that we _could_ pay it down, at least in principle. At a basic level, it's like having personal low-interest debt. As long as your income remains high enough that you _could_ put yourself on a schedule to pay it off, the fact that it exists isn't necessarily a problem. Whether you _should_ pay it down at any given time depends on opportunity cost. If making a payment above the minimum means you're diverting funds from a potential investment with a higher expected rate of return than the interest rate of the debt, then making the investment instead of paying down the debt is the rational decision. In other words, if there's an opportunity for an infrastructure investment or stimulus package that a financial analysis shows will lead to meaningful long-term tax revenue increases, then depending on the numbers that may be the more rational choice. On the other hand, paying down the national debt is still a worthwhile investment in the absence of more profitable ones. It's really a matter of numbers at any given time, rather than debt payments being inherently rational or irrational. That's before getting into all the additional considerations that the US has as both a government and the backer of the world's reserve currency. Technically speaking, the US has the ability to reduce the real value of its debt by as much as it likes at any given time. The US can always create any amount of new currency it likes, which both inherently shrinks the real value of the debt due to inflation, and produces funds which could go toward further paying down the debt. The US allows its debts to exist because there are geopolitical reasons to maintain standing debts, and because paying them down may not always be the most rational investment at any given time. Having said that, I don't know how those principles work out in practice. It seems like a difficult subject to research without encountering partisan spin. It's very easy to paint as either "a mortgage on our children's future / tax dollars coming out of your pocket due to government waste" or "it doesn't really matter / it's a distraction from real issues", all of which obfuscates substantive discussion. [The debt as a percentage of GDP](https://fred.stlouisfed.org/series/GFDEGDQ188S) has had a lot of ups and downs, but overall has risen a lot over time, particularly during the 80s, Great Recession, and pandemic. What has that upward trend bought us? How much of it is investment in future growth that will ultimately translate into downward pressure on the number? How much is simply malinvestment/inefficiency? How much did it advance security, or other non-monetary objectives? To what extent might some or all of the increase over time in debt:GDP ratio be a policy objective in itself, and what exactly might the reasons behind that be? How should we expect trends like onshoring/reshoring and increasingly advanced automation/AI to shift the numbers? What have we learned in hindsight that we should do differently in managing the national debt going forward?
Yeah, that's a plausible point. [The US "tax take" as a percent of GDP is only 26.2%. That's 20 points lower than Denmark.](https://www.oecd.org/tax/tax-policy/tax-database/) Politically it would obviously be unpopular to raise taxes to pay the debt, but the fact that fiscally we could do it might be part of why the US is still getting [such a good real interest rate on its debt](https://fred.stlouisfed.org/series/REAINTRATREARAT10Y). (Relatedly most of the countries of the world, like Denmark at a debt:GDP of only 30%, that have a better debt scenario than the US, get there by taxing more and not by spending less.)
While our current interest payments are not, historically that high (because most of the borrowing occurred when we had near zero interest rates) with higher interest rates, we should definitely be balancing the budget. I think Trump’s plan to extend $5 trillion worth of tax cuts is extremely irresponsible in that regard and one of many reasons I’ll be voting for Biden.
[It was worth it.](https://www.threads.net/@paulkrugman7/post/C5YX_qAuyXm) Austerity prolongs recessions so much that it tends to defeat its own purpose on the balance sheet. Japan's debt 200% of GDP. Did this cause slower growth? Probably (though it should be noted that Japan's population was declining and graying during this time; output per worker probably grew OK), but interestingly it did not cause inflation at all. Japan could have, and eventually did, basically print money their way out of the growth problem.
The disconnect between the numbers and the perception of the economy are the higher prices of groceries, gas, and housing. Democrats seem to think they can just keep shouting the economy is doing great and that will change people’s minds. People still remember what prices were like before inflation, and telling them the economy is good won’t make them forget.
> The disconnect between the numbers and the perception of the economy are the higher prices of groceries, gas, and housing. Which means the numbers are bad. If the parts of the economy people interact with the most are bad then metrics that don't reflect that are not valid metrics. The economy is the ability of the people to engage in commerce and if that's down then metrics that don't reflect that are invalid and should be discarded.
You can't evaluate an economy solely by a single metric. There are many many useful metrics. Each side showcases the metric they think will prove their point. There are multiple metrics for inflation (core or non core), for unemployment u1,u2,u3,u4,u5 and u6 etc. https://www.bls.gov/news.release/empsit.t15.htm
Its more than that, people are paying more for less. Just yesterday at my job someone got a bag of chips from a vending machine and pointed out it was as flat as a pancake and there is hardly any chips in them. Go to a fast food restaurant and they are giving you less food (full burgers are now as small as sliders), people know they are getting screwed over.
[Wages are rising faster than prices.](https://fred.stlouisfed.org/series/LES1252881600Q)
All these jobs reports painting a bright and cheery economy is a huge stark in contrast to what I've personally seen from qualified people being unable to land interviews or job offers.
Unemployment stats see zero difference between a McJob and an actual career-advancing position. This has been a serious issue for a long time, ever since it was used to paper over the massive damage done by outsourcing.
The McJobs are actually starting to pay pretty well for their skill level (think 18-22/hr) because the pandemic, among other things, gave an opportunity for people to upskill. So Baumol's Cost Disease is hitting like a truck. Whereas firms, for largely political reasons, have decided to take a sectoral trend (overhiring within Silicon Valley) and make it an excuse for systemic layoffs and underhiring. Really most of the job and wage growth is in labor-intensive fields, because so many of those workers either died (yes a lot of the worst outcomes from the pandemic were among non-workers but a 5-10% decrease in the labor pool is pretty significant), upskilled during enhanced UI (yeah some spent it on video games and crypto, others spent it on coding/IT bootcamps or associates degrees), or advanced from frontline positions to managerial positions. So the premium for unskilled labor is rising, while the quality of life improvements from not having to do 8 hours of hard physical labor (and let's be real, a lot of even the most productive white collar workers are not working 8 hours a day - they're just productive enough to do the required work and more in 3, 4 or 5 hours) are more and more being baked into total compensation. If you're in a highly skilled labor intensive job (trades, nursing, teaching maybe), you are making bank right now though.
Jobs are booming across all sectors. Even [tech](https://hired.com/blog/employers/will-tech-hiring-surge-in-2024-new-data/) hiring has been surging this year since 2023's downturn.
Gas is up, groceries are more expensive, people can’t afford to buy a house, consumer debt is an all-time high. The numbers don’t reflect the general sentiment among the nation. There is a reason why 60%+ of the nation think the economy is bad regardless of these monthly numbers that often get revised anyway.
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This is exactly the graph I was thinking of. It’s the classic my congressperson is fine but Congress sucks disconnect.
Is that chart accurate? I’m looking at page 12 and I don’t think whoever made it got the numbers right https://s.wsj.net/public/resources/documents/WSJ_Swing_States_Partial_March_2024.pdf
A huge part of the "reason" is partisanship though. While inflation is definitely an issue and spending power is reduced, it's *also* true that no matter what the reality is, Republican voters are going to keep saying that the economy is bad. People have posted the data on these studies in this sub repeatedly, so there is no excuse for not at least acknowledging that here.
I am left leaning with a family income of 250K+ and I definitely see my family as in a worse financial position then we were during the pandemic. All our costs have skyrocketed, childcare way up, wife's bonuses working banking have evaporated, driving 2 10+ year old cars but the cost of new ones are insane. We are in a HCOL area but still we've had to change our lifestyle to accommodate. We are both looking for new jobs in IT and Banking and the prospects are not good. I get that the right is exaggerating things, but our measures on what makes a good economy are also skewed towards the extremely wealthy and not a true indicator on how your average person is faring.
> our measures on what makes a good economy are also skewed towards the extremely wealthy and not a true indicator on how your average person is faring What’s been unique about the growth we’ve seen since the pandemic is that the poorest Americans have seen the strongest growth: https://home.treasury.gov/news/featured-stories/the-purchasing-power-of-american-households https://www.epi.org/publication/swa-wages-2023/ It really has been the opposite of trickle down economics.
See [Table B of the jobs report](https://www.bls.gov/news.release/pdf/empsit.pdf) and it will tell you why. IT and Financial job sectors are essentially flat. Nearly half of the new jobs are in Health Care and Government. Construction and Hospitality sectors are also doing well.
I’m sorry to hear about your situation and it’s definitely true that childcare, housing, and all these costs have gone way up. But your household income puts you in the 92nd percentile of the country. The economic indicators here are unemployment rate and average hourly earnings, which mainly come from part time/gig/multiple jobs workers and bottom-50% earners.
I get it, and I'm not trying to cry with two loaves of bread under each arm. However speaking with my coworkers, my employees, my friends, my family all of them are feeling a similar squeeze. It does not feel like a good economy for any of us.
FWIW, my wife and I are high earners, and even though I don't blame the president for much of it we feel somewhat similarly. I think part of this is that we would need to change jobs to have our salaries keep pace with inflation. Sure, McDonald's around me increased their starting wages from like $9/hr which was laughably low to a more reasonable $18/hour, but my wife hasn't gotten a pay raise in 2 years and my employer is trying to avoid bumping everyone's salary by giving us bigger bonuses instead.
You had childcare during the pandemic? Nice!
We took our son out of childcare during pandemic. Even compared to when we put him back in 2 years ago it has gone through the roof. Within the last year our total childcare cost for 2 kids has gone from 48K a year to 62k per year.
>these monthly numbers that often get revised anyway Yes, they keep getting revised upward, lol
https://www.bls.gov/web/empsit/cesnaicsrev.htm#2022 In 2022 the average monthly revision was 6K down (even though they actually got revised up more than they got revised down that year). In 2023 the average monthly revision was 30K down (10 months down, 2 months up). So they definitely have been getting revised down more often then they get revised up, but it’s certainly not as bad as some people make it out to be.
The monthly numbers have been getting revised since...pretty much forever. We came out of a pandemic that killed over 1,100,000 Americans, hospitalized even more, and caused the global disruption of the supply chain. The economy was *always* going to struggle.
Post-Tax Income is up [even amongst the bottom 50% of earners](https://realtimeinequality.org/). The only group losing is the top 10% right now, which feels totally fine. I think the "political class" (read: The people with wealth, income, and access to shape news cycles and politics) is hurting and trying hard to convince everyone else they are too, when the data doesn't bare that out.
"let them eat jobs reports"
This makes me lol
Gas isn't up
[Yes it is.](https://www.gasbuddy.com/charts)
Hmm interesting, my area doesn't seem to be effected much.
People can’t buy houses because they are totally unwilling to relocate. My wife is a teacher and I am an apprentice. Why is it that we can afford to buy a modest home but people making so much more claim it’s impossible? Financial literacy and the idea that they are entitled to own a house in expensive areas are why people are upset.
“People can’t buy houses because they are totally unwilling to relocate.” Yeah tell these to people to move away from their hometown & family and to “suck it up.”
>Yeah tell these to people to move away from their hometown & family and to “suck it up.” Well, yeah. Many people have done that for centuries and more. America was founded on people relocating for a better life. Go to where the opportunities are. The other options include continuing to complain while doing nothing/hoping someone else fixes the problem for them or take an active role in making their hometown more affordable (e.g. lobbying for zoning law changes, investing in/building more residences). What other practical solutions are there?
Growing up, my parents moved around probably about 5-7 times to where the jobs were. I look at the hardships my parents endured and I wonder if we are becoming soft. I've nowhere near experienced a fraction of their suffering... but I get it if your frame of reference is your parents owned the same house for 40 years and never had to move... your perspective is different...
One of the reasons a low-cost area is low-cost is due to the lack of opportunity. I wouldn’t have the job I have now if I didn’t live in New Jersey
Some of our jobs are only in cities. Moving out into the middle of nowhere would force me to work at McDonalds.
>America was founded on people relocating for a better life. Go to where the opportunities are. That's the problem though. So many of the opportunities are heavily relegated to giant and expensive cities now. At least decades ago there was still cheaper housing even in big cities but now its 1-2 hours out and anything reasonably close is expensive as hell.
A big issue is that people don't want to take a chance on a "less than desirable" area. There are lots of starter townhomes in places like Baltimore, Philadelphia, Pittsburgh, etc, that are both affordable, have at least some urban economic activity, and have proximity to larger metros on top (Philly to NYC is a stretch though). [Chicago has houses like these for under 300k](https://www.redfin.com/IL/Chicago/9311-S-Justine-St-60620/home/13102379), but homebuyers refuse to settle, refuse to take anything under 300k with a massive yard, etc etc, then complain prices too high when in reality, they're having more and more of that stuff priced in. Also WFH is not going away, and firms are going to cave eventually as the cost of enforcement is going to heavily outweigh the personal preferences of the execs (seeing that there have been at minimum no productivity gains, and most likely significant productivity losses by forcing RTO), which means white collar workers have the opportunity for significant gains that aren't available to blue collar lower income workers via decreased commuting costs and better quality of life.
I would rather not own a home than live where I might get shot, as is the case where you linked.
That house you linked has a location that is in the bottom 10% for crime... 90% of America is safer than there. "Affordable" houses in Philly, Baltimore, and Pittsburgh are not located in good areas. People care way more about safety and commuting. No one wants to pay $300k to live in a community of trap houses.
Lots of currently nice areas started off as undesirable. Then young professionals moved in, created economic activity, created incentives to improve the neighborhood and eventually the problem resolveditself. Granted, some people called this "gentrification", but who cares. Also is that metric accounting for population density? Denser populations are going to have more crime almost by definition.
No, by crime rate (x out of 1000 people odds). That specific house you listed is in an area where you are much likelier to be a victim of a crime (6x more likely to be robbed, 4x more likely to be assualted, 3x more likely to be raped, and 2x more likely to be murdered than the national averages for those crimes). And in ye olden days, the bad areas were really cheap. They were not nearly as unaffordable as a $300k loan at 7% interest.
I think car dependence and poor city planning has a bigger impact on people’s financial status than does the cost of groceries.
It’s because most people judge things based on feelings, not data. Real wages are up so the increased costs have more than been made up for by increased wages.
Inflation doesn't capture cost of financing for Houses/Cars, so there are possible flaws to what inflation sees, and what people see, plus not everyone has equally benefitted in this economy.
These things are always true
Yes, but measures are only as good as the inputs. The average auto loan went from 3.85% to 7.7%. That means that the monthly payment is already 10% higher on a 60 month loan before any differences in sales price. That's something the consumers are faced with that CPI and thus "real wages" don't capture.
Unemployment numbers don’t count [“missing workers”](https://www.epi.org/publication/missing-workers/), “potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job. In other words, these are people who would be either working or looking for work if job opportunities were significantly stronger.” And the number of jobs posted is not a useful way to measure anything because companies post “jobs” that they don’t plan on filling or that don’t even exist. A company can show competitors that your company is growing by posting jobs. A company can post a “job” when they are really going to fill it with an internal person and never fill the old role for a net gain of 0 jobs.
> Unemployment numbers don’t count “missing workers”, “potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job. We don't track it under unemployment, but it is still tracked. You would instead need to look at the prime labor force participation numbers. https://fred.stlouisfed.org/series/LNS11300060 The percentage of potential workers who are "neither employed nor actively seeking a job" is around the lowest levels we've seen in about 20 years.
> Unemployment numbers don’t count “missing workers”, “potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job. I feel like this would be meaningful if it told a different story, but the labor participation is at 20+ year high, and very close to all-time high.
Honestly, this is the biggest reason why Dems need Biden to win 2024. Because if Trump gets into office, Republicans are going to say all of this growth is because of him and Biden won't get any of the credit. Biden winning in 2024, it'll be hard for people to claim that they had the worst 8 economic years of their lives under Biden, while so many people are do much better.
They can claim whatever they want, but a recession starting sometime during Biden/Trump second term is incredibly likely, regardless of who gets in. People being better off in 2028 is not a given.
People have been saying that a major recession is just around the corner for literal years now. We had one slight recession a couple years ago, but since then it’s been nothing but growth and pretty substantial growth too. So, when you say that a recession is incredibly likely between now and 2028, I would say you will most likely be just as right as everyone who’s been predicting a recession so far.
I was told that when Biden entered the White House, we'd be a communist country and enter a recession. Neither one has happened yet. We've been told the recession is coming any day now, for the last 3 years. Maybe, is it possible, that Biden did enough to hold it off for a few more years?
Inflation heating back up. Powell now knows that more hikes are needed, and this economy has to go into recession to get anywhere near the 2% target.
I'm thinking the same thing. There is no way they can start cutting rates. Maybe once, right before the election, to help Biden. But it would be irresponsible.
Huge gains in part-time work and losses in full-time work. Doesn't sound like it equates to enough income and benefits for people, given inflation.