‘Affordability’: Consumer Concerns and Government Proposals

Exchanges

Goldman Sachs

Business

4.3 • 1.1K Ratings

🗓️ 10 February 2026

⏱️ 23 minutes

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Summary

What's driving concerns about the US cost of living, and can the administration's proposals effectively address them? David Mericle, Chief US Economist, and Alec Phillips, Chief US Political Economist, at Goldman Sachs Research discuss with Allison Nathan. Date of recording: February 5th, 2026. The opinions and views expressed herein are as of the date of publication, subject to change without notice and may not necessarily reflect the institutional views of Goldman Sachs or its affiliates. The material provided is intended for informational purposes only and does not constitute investment advice, a recommendation from any Goldman Sachs entity to take any particular action, or an offer or solicitation to purchase or sell any securities or financial products. This material may contain forward-looking statements. Past performance is not indicative of future results. Neither Goldman Sachs nor any of its affiliates make any representations or warranties, expressed or implied, as to the accuracy or completeness of the statements or information contained herein and disclaim any liability whatsoever for reliance on such information for any purpose. Each name of a third-party organization mentioned is the property of the company to which it relates is used here strictly for informational and identification purposes only and is not used to imply any ownership or license rights between any such company and Goldman Sachs. A transcript is provided for convenience and may differ from the original video or audio content. Goldman Sachs is not responsible for any errors in the transcript. This material should not be copied, distributed, published, or reproduced in whole or in part or disclosed by any recipient to any other person without the express written consent of Goldman Sachs. Disclosures applicable to research with respect to issuers, if any, mentioned herein are available through your Goldman Sachs representative or at www.GS.com/research/hedge.html. Goldman Sachs does not endorse any candidate or any political party. Copyright 2026, Goldman Sachs, all rights reserved. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Affordability has become one of the most salient political buzzwords.
0:09.3	So what's driving concerns about the cost of living and how likely and how effective
0:14.3	might attempt to address these concerns be?
0:17.4	I'm Alison Nathan and this is Goldman Sachs Exchanges.
0:23.6	Today I'm sitting down with two of my colleagues in Goldman Sachs research.
0:26.6	David Miracle is Chief U.S. economist and Alec Phillips is Chief U.S. political economists.
0:31.6	David, Alec, welcome back to exchanges.
0:33.6	Thanks, Allison.
0:34.6	Thanks.
0:35.6	So David, first just set the stage for us, again, we're hearing a lot
0:39.5	about affordability these days. But what does the economic data actually say about affordability
0:45.9	and how it has evolved? Yeah. So at first glance, it might seem a little bit surprising that
0:51.6	this has become a big political theme. For one thing, real income, how much spending power you have adjusted for inflation, is more
0:59.3	or less back on its pre-pandemic trend, not just an aggregate, but across all of the different
1:04.6	income quintiles, at least on average as well.
1:07.5	So if in 2019 you had known where we were going to wind up, you wouldn't necessarily
1:12.0	have thought that all of the extraordinary things that have happened over the last few years,
1:16.3	the pandemic, the inflation search has happened. Where we are right now in terms of total
1:20.3	spending power doesn't seem that strange. The other reason that this is a little bit surprising
1:24.5	is that the U.S. of course, has a very high level of income, even relative to other advanced economies. Often, when I'm traveling abroad, talking to our foreign
1:32.1	clients, they express a lot of surprise that the U.S. perceives that it has an affordability problem
1:36.9	because U.S. income, in fact, income even in some of the poorer U.S. states, is higher than in
	...

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