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Recent polls have shown a marked deterioration in economic sentiment, and there’s a big worry that this will create a self-fulfilling prophecy.Why are consumers so depressed?
The ASR Consumer Survey (via Politico) takes a look at what’s really eating consumers.
Among the factors: Too high debt, fears of inflation, and expectations that their homes will keep falling in value.
The smaller the shape, the worse the demographic is faring. Clearly, the middle class (red shape) thinks they are faring worse than the U.S. average and the high net worth group on every measure.
33% of homeowners think their home is worth less now than when they paid for it. Furthermore, homeowners and renters are both pessimistic on the outlook for home prices.
Only 33% of those polled said they spend less than they earn. 72% think they save too little. Of those polled, only 50% are prepared to take risks with their savings.
39% said they fear a rise in the cost of living more than they fear higher taxes or a drop in income. All things considered then, Americans are likely to spend less.
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