Gosh I wonder why this is so.
No question mark, on purpose.
At this point US consumers are just rain dancing for a recession
Thank goodness we dont have European fundamentals or we’d be downright despondent
I think something is missing from this picture . . .
Perhaps COL graphics? Maybe cost of housing specifically?
I’d also ask about the numbers used to create the GDP per capita numbers . . . especially what’s used for the denominator . . . I think you’re going to get very different numbers between the following calculations (assume all counts are for those between 18 and 75 years of age):
- Total GDP of country / # citizens
- Total GDP of country / (# citizens + # permanent residents)
- Total GDP of country / (# people in country)
I feel like there are differences between what’s being reported in the government stats and what’s really going on, and I don’t know how much seasonality adjustments are screwing with things. I think it was reported that auto insurance was -0.1% this month after like +19% in January, and I don’t know that insurers are saying we got that big rate increase in, everything is cool, no more problems now, we can get back on our 0.9% growth plan for the next 100 years.
Things like that.
I think people are very sensitive to price inflation but feel wage growth is largely unrelated.
the thing is that people don’t buy “a basket of goods”. So the idea that inflation is only a few % just doesn’t resonate with individuals. They see headline numbers, like eggs at $3.50 / dozen when last year it was $1.75 / dozen, and it doesn’t feel like a 3% increase. Or, in my case, I was at the auto shop and the stated rate for labor was $150 / hour. I am certain that less than 4 years ago this was listed as $90 / hour. So if you’re paying 67% more for a thing, sure, it might be only a small portion of the 3% overall increase, but it sure as hell doesn’t feel like it.
Everybody has their own “personal inflation rate” so I agree with that psychology.
Food, housing, insurance, services etc. have all gone up massively over the last few years.
Real wages have actually increased, just not at the level necessary to adjust for those increases (for many people).
On the other hand, it sounds like your auto guy just got a 67% wage increase.
That table doesn’t really tell you much.
If you adjust for GDP per capita increases, UK and Canada would be at the bottom of the table.
I don’t think the denominator changed much, whether or not you count citizens. It’s the numerator that climbed, from $21T to $28T.
You can see real GDP growth in the above chart. Again solid increase while the rest of the world has flattened.
Might add the Stock Market is doing excellent. And we’ve been at full employment for a record number of months.
You’re not supposed to buy a dozen eggs, you’re supposed to buy 1/1000th of a car every month!
I don’t think observed inflation figures should be so important, but the media make them so. Especially if the number favors their political view.
Ifyp (pretend those are strike-throughs)
Could certainly add that income and wealth distribution and demographics are not in that picture.
Not everybody has gotten raises and not everyone has a retirement account. And those that do probably don’t thank inflation for their raise.
I wonder how many are complaining that gov’t assistance has ended as part of their “economically worse off”?
My parents always complain about the price of fast food. Last time my dad and I spent the day together, we had fast food for lunch, and it cost nearly $30. Then they blame this on the $15-20 the workers make now. For $30, we could have gone almost anywhere for lunch, maybe we need to add a tip and go a few dollars over that, but it seems most places around here still have a sandwich and side for about $12-15.
I think a lot of the feels are things like this more than the reals of overall inflation. Soda seems expensive now, so do chips, and a lot of other pre-packaged foods. Fruits, vegetables, dairy seem higher, but not crazy, and eggs seem like they are now back to about $1.something a dozen.
For those without a lot of extra income, it probably feels like they can’t afford as much of those things, and that is probably true.
If 12-packs of soda are really cheap, they’re $5. Most of the time, they’re $8.
That kind of stuff, all over the place.
In Europe, the largest price increases that I have seen is in hotels & restaurants. Incredible price increases in larger cities like Madrid, London, Paris, Milan etc mostly driven by energy and labour costs since 2019.
Is it the same in the US?
Like this?