### Summary
The chief global economist at Piper Sandler has warned that the U.S. economy is set to worsen before improving, and Americans should save money and maintain their savings. Rising everyday prices, declining manufacturing activity, excessive government spending, and a tight labor market are all contributing factors.
### Facts
- Americans are spending $709 more on everyday goods in July compared to two years ago.
- One-third of U.S. households spent more than 30% of their income on housing in 2021.
- Excessive government spending is blamed for high prices.
- The declining birth rate and closure of maternity wards indicate that Americans are postponing having children.
- Inflation is a major challenge for the economy, and a recession will put pressure on all wealth groups.
- The economist argues that the fiscal stimulus from the Inflation Reduction Act has had a "counterproductive" impact on controlling inflation.
- To see an economic turnaround by 2025, the private sector needs to drive capital spending, while curbing government spending and reforming entitlements is necessary.
- The economist hopes for sustained low inflation and increased labor force participation but emphasizes the need for tough decisions in Washington.
- The economist believes that the U.S. needs to get its fiscal house in order to become a leader in the global economy.
The US economy is growing rapidly with favorable conditions for workers, but despite this, many Americans feel pessimistic about the economy due to inflation and high prices, which are driven by complex global forces and not solely under the control of President Biden or Trump. Housing affordability is also a major concern. However, the Biden administration can still tout the economic recovery, with low unemployment and strong economic growth forecasts.
Despite signs of declining U.S. inflation, a majority of Americans, particularly those living in rural areas, are experiencing higher grocery prices under President Biden's economic policy, known as Bidenomics. Concerns about inflation and reliance on partisan news contribute to the perception of economic challenges, despite reports of a strong U.S. economy.
Economists discuss the state of the U.S. economy, effects of Bidenomics, inflation outlook, and more.
China's economic difficulties can be attributed to its reliance on authoritarianism and central planning, which has led to wasted capital, labor, and diverted efforts, creating significant problems and holding back the economy. The Biden administration's adoption of industrial policies and top-down planning in its economic scheme, known as "Bidenomics," bears similarities to China's flawed approach.
President Joe Biden claims that his economic vision, known as "Bidenomics," is working, highlighting achievements such as reducing Black unemployment, cutting child poverty, and promoting clean energy, while Republicans criticize the approach and public opinion remains skeptical.
President Biden's new spending initiatives, including the "Inflation Reduction Act," are likely contributing to an increase in inflation, counteracting his claims that inflation is under control and negatively impacting the financial situation of average Americans.
President Biden claimed that the United States has the lowest inflation rate among major world economies, despite his own Commerce Secretary acknowledging that inflation "still exists" and is a challenge for Americans.
Despite positive economic growth and low unemployment rates, several major indicators suggest that the American economy under President Joe Biden is heading towards a recession, with high government deficit numbers indicating possible overspending to prevent a recession before the 2024 election.
Deputy Treasury Secretary Wally Adeyemo believes that reversing the rise in inequality in the United States is crucial for overall economic growth, and the Biden administration is focused on driving down inflation and making targeted investments to revitalize underserved communities.
The COVID-19 pandemic and the expiration of pandemic-era programs have led to a rise in child poverty and an increase in the overall poverty rate in the US, while household income has fallen and inflation has soared, according to the US Census Bureau.
Despite increased household wealth in the US, millions of households are struggling financially due to inflation, high interest rates, and rising living costs, which have led to record levels of debt and limited access to credit.
US household income fell by the most in over a decade in 2022, showing the impact of rising costs and the expiration of pandemic relief programs, with the median income dropping 2.3% and marking the third consecutive annual decline, contributing to concerns about the financial well-being of American families.
The personal lens of individuals' financial well-being is a significant factor in how they rate the national economy, with inflation and high prices being major concerns, leading to a lagging personal recovery for many Americans since the pandemic, which impacts their assessment of the economy; furthermore, individuals who are struggling financially today tend to give worse ratings of the U.S. economy compared to those in similar positions in 2019, which contributes to President Biden's low economy and inflation ratings.
American workers are facing a decline in median annual household income due to high inflation, with 17 states experiencing a decrease while only five saw an increase, according to data from the Census Bureau. The labor market remains challenging, with wages rising but not enough to keep up with inflation.
The Biden administration's efforts to win back rural America and gain credit for economic gains face challenges due to years of neglect, skepticism about government spending, and divisions over social issues, as rural voters have shown support for Republicans and are concerned about inflation and pocketbook issues.
A new survey shows that President Biden's claim of improving the economy is not resonating with American voters, with more than twice as many feeling worse off than better off since the pandemic, potentially impacting his chances in the 2024 election.
Americans are facing persistent inflation and a high cost of living, but elite economists and academics are disconnected from the reality and dismissive of the struggles of everyday Americans.
Some Democrats are concerned that the branding of "Bidenomics" is falling flat and not effectively selling the economic achievements of the administration, with polling data showing that the public remains skeptical and the rising cost of living is still a dominant concern.
Despite the White House's promotion of "Bidenomics" and claims of economic progress, negative polling and economic figures have led to significant pushback from Democrats, with most Americans believing that the White House is actually hurting the economy and expressing concerns over housing costs and inflation.
President Joe Biden's approval rating has dropped to its lowest level since he took office, with disapproval of his economic policies rising due to financial stress caused by factors such as rising interest rates, higher gas prices, and renewed student loan payments.
The White House's "Bidenomics" agenda and excessive government spending, coupled with the Federal Reserve's low interest rates, could lead to a catastrophic economic crisis marked by inflation not seen since the Great Depression, putting strains on American families and depleting savings, requiring urgent action to reduce spending and avert disaster.
The US housing market is showing similarities to the 1980s, characterized by high inflation, surging mortgage rates, and pent-up demand, which could result in prices stabilizing or slightly falling, but not to the extent of the 2008 housing crash, according to Bank of America.
President Joe Biden is set to address the positive growth in the economy shown in the September jobs report, with nonfarm payrolls increasing by 336,000 and the unemployment rate at 3.8%.
President Joe Biden attributes Americans' dissatisfaction with the economy to negative media coverage, despite the high number of job gains in September and improved financial conditions for many individuals. The entertainment industry experienced a decline in employment amid strikes, while other sectors saw positive growth. Economists express surprise at the strong job growth, but concerns arise regarding potential interest rate increases by the Federal Reserve.
President Biden criticized the media for focusing on negative stories and claimed that the American people are better off financially, despite overseeing the highest non-pandemic annual deficit in US history and confusing the terms "debt" and "deficit."
The U.S. economy's job numbers appear strong on the surface, with a significant increase in non-farm payrolls, but a closer look reveals weaknesses such as a rise in part-time workers, a decrease in full-time workers, and an increase in people holding multiple jobs, indicating financial struggles for many Americans. Additionally, government jobs, rather than private sector jobs, experienced the largest increase, while manufacturing workers face affordability challenges due to rising prices outpacing wage growth. The Biden administration's economic policies have led to low favorability ratings and increased costs for groceries and gasoline. Home affordability is worsening, with high mortgage rates and negative trends in housing starts and sales. Although the economy shows resilience due to rising corporate profits, Joe Biden's proposed tax hikes threaten business success. The article criticizes Biden's claims about cutting the federal debt and achieving budget surpluses, stating that the budget deficit is expected to reach $2 trillion or more in fiscal year 2023. Overall, the analysis suggests weaknesses and concerns in the U.S. economy under the Biden administration.
Despite positive economic indicators such as job growth and low unemployment, the perception of a healthy economy is overshadowed by the high cost of living, including inflation, rising housing prices, and increased interest rates.
Joe Biden's economic agenda has been criticized as "clueless" by Dr Arthur Laffer, who claims that the administration's focus on income inequality is making all Americans worse off, while also slamming trickle-down economics and expressing hope for Donald Trump's potential return as President.
The Biden economy is causing problems for Americans who have been fleeing liberal states like New York and California for lower home prices and taxes, as business experts warn of potential financial issues on the horizon.
American families are facing a variety of financial challenges, including inflation, high costs of living, and increasing mortgage rates, which are making it difficult for young families to buy homes; in addition, sudden job loss can lead to a financial doom spiral.
Poverty has surged in California and the US, particularly among Black and Latino residents and children, due to the expiration of pandemic relief programs and rising inflation rates, according to new studies. However, some experts dismissed the findings, arguing that government data do not fully account for the aid and benefits received by poorer families. Efforts are being made at both the state and local level to address the issue, including experimenting with monthly cash payments to individuals living near or below the poverty line.
American families experienced significant gains in income and wealth from 2019 to 2022, but the largest increases were seen among high-earning and white families, while Hispanic and Black families experienced small declines in median income, according to a Federal Reserve survey. However, all ethnic and income groups saw a rise in median net worth, with the lowest-earning households seeing the smallest increase. The survey also revealed that Black households had the lowest median net worth, while white and Asian households had the highest. Education levels played a significant role in income increases, with those with at least some college education or a degree seeing their incomes rise. Overall, the survey showed that financial fragility declined during the period, with households displaying greater financial resilience post-pandemic.
