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Consumers Feel Worse Now Than They Did During Covid Lockdowns

WSJ [paywall]: Sentiment has fallen to levels typically associated with worse financial and economic conditions than today’s: “The University of Michigan survey of consumer sentiment measures how U.S. consumers feel about their personal finances, business conditions and buying conditions. Recent surveys have shown that consumers have rarely felt more downbeat about all of these measures. In the past, when consumer sentiment was as depressed as it is today, stocks were in a bear market, unemployment was higher than average or prices were rising faster than usual.This year, inflation has been near four-decade highs and a main driver of consumer pessimism. The S&P 500 is in a bear market, but up 7% from its 2022 low. Uncharacteristically of periods with low sentiment, unemployment is historically low…A souring mood for consumers is a concerning sign because household spending accounts for about 70% of U.S. economic output…”

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