The paradox between the macroeconomy and household sentiment
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Ben Harris and Neale Mahoney analyze the disconnect between U.S. economic performance and consumer sentiment; as of September 2024, unemployment rate at 4.1%, GDP growth at 3.0%, and household wealth increased by $50 trillion since Q1 2020; consumer sentiment indices show a significant decline post-pandemic, with the University of Michigan’s Index of Consumer Sentiment falling below the Conference Board’s Consumer Confidence Index; political bias and media negativity contribute to pessimism; younger Americans show declining happiness; CEO confidence contrasts with consumer sentiment; inflation perceptions remain high despite actual rates declining to 2.6% as of August 2024; partisanship impacts sentiment, with Republicans exhibiting stronger biases; the analysis suggests inflation, partisanship, and media influence as key factors in the sentiment gap.

#Economy #ConsumerSentiment #Inflation #Partisanship #Covid19 #UsEconomy #Wages #Media #Politics #BirthRates

https://www.brookings.edu/articles/the-paradox-between-the-macroeconomy-and-household-sentiment/