The G-Shaped Economy: Why consumer sentiment is at a record low but spending keeps rising
By
Andrea Riquier
Kettled twice. Extra chewy, extra trustworthy.
Summary
The article explores the puzzling disconnect between record-low consumer sentiment in the U.S. (with the University of Michigan's index hitting 44.8 in May 2026) and continued consumer spending. It examines why Americans report feeling pessimistic about the economy yet continue to spend, and questions whether financially stable baby boomers are propping up the economy by supporting their adult children.
Key quotes
· 3 pulledWhy are American consumers reporting the lowest sentiment readings on record – yet continuing to spend as if all was right with the world?
The University of Michigan's Consumer Sentiment Index sank to an all-time low of 44.8 in May, for the third-straight monthly decline.
Inflation is simmering throughout the economy. And the job market is tepid at best.
You might also wanna read
Analyzing the Affordability Gap: Why Economic Recovery Data Doesn't Match Consumer Sentiment
The article examines the disconnect between economic data showing recovery in real median household income and persistently low consumer sen
newsletter.mikekonczal.com·3mo ago
Analyzing the U.S. Economy's Unexpected Resilience Amid Warning Signs
This article analyzes the puzzling resilience of the U.S. economy despite multiple warning signs, including weak manufacturing due to Trump'
noahpinion.blog·7mo ago
Economist Diane Swonk: Only high-income Americans with stock portfolios feel good about the economy
Economist Diane Swonk argues that while economic indicators appear positive with slowing inflation and potential Fed rate cuts, the economy
fortune.com·7mo ago