whatever American consumers say about the state of the economy, they are spending as if their finances are in pretty good shape. Most recently, holiday sales appear to have been quite good.
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Americans aren’t acting as if they’re terrified about crime. As I’ve written before, major downtowns have seen weekend foot traffic — roughly speaking, the number of people visiting the city for fun rather than work — recover to prepandemic levels, which isn’t what you’d expect if Americans were fleeing violent urban hellscapes.
The evidence clearly shows Americans have maxed out their cards and are riding debt while buying only essentials. That’s not good. That’s ignorance of impending doom.
It’s also NOT good for anyone who hasn’t got a new job in the past couple years. If everything around you is 20% more expensive and you’ve received a 3% raise, things are very bad for you.
It is very good currently for those with 401ks and can leverage, use, or sell the gains they are getting.
On average, wages went up, even after accounting for inflation. There are people for whom this is not true, but for most people, they’re actually better off.
Note that there’s a really distortive spike during the pandemic as low-wage workers disproportionately lost their jobs.
That one metric, divorced from cost of living, is meaningless. If you want to make a convincing argument that Americans are doing better, you have to show that rising wages matched or outpaced rising prices. It doesn’t matter if I make a dollar more than I did last year if everything costs two dollars more than it did last year.