Welcome to money for the rest of us. This is a personal finance show on money, how it works, how to invest it, and how to live without worrying about it.

I'm your host David Stein. Today is episode 472. It's titled, Is the Economy as Bad

as People Think? In the US the unemployment rate has been under 4% for two years. That's the best stretch of unemployment since the

1950s. The latest inflation numbers, the US Consumer Price Index. It increased only 3.2% for the year ending February

2024. That's down substantially from 2023 and 22.

Real wages for US workers are higher now than they were prior to the pandemic.

In other words, US workers after adjusting for inflation are making more money than they were four years ago.

Yet surveys of U.S. consumer sentiment show not only did consumer sentiment hit its lowest level ever in mid-2020

but the level of consumer sentiment is still well below what it was prior to the pandemic. Why is there

this disconnect between economic progress and how we feel about the economy? That's what we'll explore in today's episode,

but at first we're going to recognize that,

yeah, the economy is doing better in aggregate,

but it's always doing worse for somebody.

Individuals who have lost their jobs,

individuals who can't afford to pay rent. I was speaking with a friend yesterday

that lives in Phoenix and has had to downgrade their living situation because rents have

shot up so high.

There and in many other places around the country.

First let's take a look at how consumer sentiment is measured.

One of the longest running surveys of consumers is the University of Michigan survey.

It started in 1946, and they do an index of consumer sentiment.

And it's derived from five core questions.

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