High costs may partially explain Americans' dissatisfaction with the economy.There's a question journalists, economists and President Joe Biden's campaign have been puzzling over for months: Why, when every traditional indicator is positive, are Americans so displeased with the economy?, job growth is steady, unemployment remains low and wages are rising. The gross domestic product, a common measure of the health of the economy, has been.
All this taken together meant Americans were flush with cash but had nowhere to spend it. So despite the fact that the savings rate went way up, consumers still weren't feeling positively about the economy — contrary to the relationship between these two variables we saw in the decades before the pandemic.
The sticker price isn't the only thing making houses difficult to afford. After inflation began to soar, the Federal Reserve Board raised interest rates and has kept them high. Average mortgage rates for a 30-year fixed-rate mortgage are around 7 percent today. That means that lower- and middle-income families struggle to qualify for mortgages because the interest rates would make their monthly payments especially high.
One possible explanation for a shifting relationship between consumers and their cars may be something we've already covered: inflation.