In the onslaught of grim economic news, the US just hit yet another ugly milestone. The consumer confidence index fell to a 16-month low of 98.7 and the consumer expectation index hit its lowest since 2013 at 66.4.
These numbers measure people’s current and short-term future views of the economy on jobs, income growth and the overall business outlook. The plunge is distressing, but not surprising.
Inflation, per the most recent data, is up a punishing 8.6% overall year on year. The specific picture on food and gas is even worse. Meat, fish and eggs are up 14.2%; baked goods 11.6%; dairy 11.8%. Gas is up a mind-boggling 48.7%. Producer prices are up 10.8% as of the end of May, which means the pain is guaranteed to continue and the personal savings rate to keep shrinking.
All this hits the typical American family for at least $5,000 a year — and jacks up the cost of upcoming 4th of July barbecues nationwide.
No wonder people’s optimism is taking such a huge hit. Especially since the latest federal data shows our first-quarter GDP contraction was even worse than previously measured, at 1.6%.
The blather from the White House is not helping. Despite having fueled the price explosion with his $1.9 trillion stimulus injection in 2021 and his signaling of yet more spending to come, Joe Biden and his surrogates keep blaming Vladimir Putin and a mysterious cabal of corporate price-gougers for all this — even as they try to sell consumers on the upside of unaffordable gas: just buy an electric car and be part of the “incredible transition” away from fossil fuels!
Consumers know better. They see the economic storm clouds looming. So, too, do some economists, who think we may already be in a soft recession. Saddest of all, no one expects Biden to reverse his agenda to make the situation better any time soon.