Americans are ticked off about the economy. Here’s why.
Welcome back.
Here at Trendlines our fingers are crossed that the AC holds up during this week's anticipated heat wave.
?? I’m Boston Globe financial columnist Larry Edelman , and today, I look at why Americans are so unhappy with the economy.
Plus: Is the best lobster roll served hot or cold?
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Mad as hell
“What’s your message to Americans who are seeing encouraging economic data but don’t feel good about this economy?”
??? The news
The question was for Jerome Powell, chair of the Federal Reserve, posed at a news conference following the central bank’s decision last week to leave interest rates at their highest level in two decades to bring down inflation further.
?? The problem
Statistics like gross domestic product and employment don’t capture the complete economic picture. Even as the inflation rate has moderated and stocks trade at record highs, Americans are frustrated.
? Rewind
In 2020, Annie Lowrey , an economics reporter for The Atlantic, penned a piece called “The Great Affordability Crisis Breaking America.” She argued that families during the 2010s were hammered by the mounting costs of housing, health care, child care, and college debt.
? Back to today
On an episode earlier this month of “The Ezra Klein Show,” the eponymous podcast hosted by her husband, Lowrey explained that the inflation outbreak in 2021 and 2022 exploded that long-simmering crisis.
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?? My takeaway
The affordability crisis — or the level of prices — is bigger than inflation, which measures the rate of change. In other words, inflation is slowing but prices remain extraordinarily elevated.
The forces driving the cost of living higher are persistent, political efforts to mitigate them have largely failed, and the Fed lacks the tools — and authority — to tackle them.
?? Final thought
The consensus on Wall Street is the Fed will whip inflation without a recession. But we will still be left with a staggeringly high cost of living.
?? Trending
Health Care : Steward Health Care is a pivotal player in Malta’s seismic hospital scandal.
Politics : Senior citizens, long a reliable voting bloc for Republicans, are showing signs of turning into an election-year swing group, potentially giving President Biden a boost.
Social Media : The US surgeon general has called on Congress to require warning labels on social media platforms similar to those now mandatory on cigarette boxes.
?? The Closer
To mark National Lobster Day (it was Saturday), Globe writers Devra First and Matt Juul offered up a crustacean point/counterpoint on whether the lobster roll should be served cold or hot.
Sorry Matt, I have to go with Devra on this one. Readers, where do you stand?
Thanks for reading. I’ll be back on Thursday. Go Celtics!? ??
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Very well put. The fact that the inflation rate has eased does nothing to make food, clothing, housing, or cars more affordable. The cost of living has soared in the last four years and shows no sign of falling. And that's why people are so gloomy about the economy.