Economic Perspectives - 8/2/24

Perspectives

• Very Difficult
• Somewhat Difficult
• A Little Difficult
• No Difficulty

• There will be two graphs for each level of difficulty.
• The first graph will show the who has the highest and lowest percentage for each of the difficulty categories.
• The second graph shows who has experienced the biggest and smallest increase in the given difficulty category since 8/31/20.
• Since these graphs are “point in time” graphs versus the time series used during the five weeks, the graphs are less packed with data.
  As a result, I was able to add the data points on the graph and eliminate the tables.
• Since I provided commentary on each of the individual categories during the week I covered that “lens”, there will be no commentary on the graphs except in the Summary and Closing Thoughts sections.
• I added in a “lens” for gender (male or female) for the composite that I did not include for the five-part series in an attempt to fine-tune the composite as much as possible.
  

• Similar to a composite picture that is used for criminal investigations, the composite “picture” for households' difficulty in paying regular expenses will not be an exact “picture” and there is no guarantee that there are people who fit the description exactly.
• At best it is an approximation designed to stimulate your thought processes.
• The “picture” may vaguely resonate for some readers while it may appear highly familiar for others.

Summary

• The composite person with the highest percentage:
  • A Hispanic or Latino female who is 25-29 years old, with less than a high school degree, earning less than $25,000 per year and living in a household of seven or more people.
• The person with the lowest percentage is:
  • An Asian male who is 65 years or older, with a bachelor's degree or higher, earns $200,000 or more and lives in a household of two people.
• The person who has seen the biggest percentage increase since 8/31/20 is:
  • A White female who is 18-24 years old, with some college education or an associate's degree, earns $50,00-$74,999 and lives in a household of seven or more.
• The person who has seen the smallest percentage point increase is:
  • An Asian male who is 65 years or older, with a bachelor's degree or higher, making $200,000 and over and lives in a household of two people.
    

• The person with the highest percentage is:
  • A female of two or more races and is 18-24 years old, with less than a high school education, earning $35,000-$49,999 and lives in a household of seven or more.
• The person with the lowest percentage is:
  • An Asian male who is 65 years or older, with a bachelor's degree or higher, earning $200,000 or more and lives in a household of two people.
• The person who has experienced the biggest percentage point increase since 8/31/20 is:
  • A White female, 18-24 years old with less than a high school education, earning $100,000-$149,999 and lives in a household of seven or more people.
• The person who has experienced the smallest percentage point increase is:
  • An Asian male who is 25-39 years old with less than a high school education, earning $25,000-$34,999 per year and living in a household of six people.
    

• The person with the highest percentage is:
  • An Asian male who is 18-24 years old, with some college education or an associate's degree, earning $35,000-$49,999 and lives in a household of six people.
• The person with the lowest percentage is:
  • A female who is either White or a person of two or more races, is 65 years or older with a bachelor's degree or higher and lives in a household of seven people or more.
• The person who has experienced the biggest percentage point increase since 8/31/20 is:
  • A White male who is 55-64 years old, has some college education or an associate's degree, earns $100,000-$199,999, and lives in a household of six people.
• The person who has experienced the smallest percentage point increase is:
  • A female of two or more races who is 18-24 years old with less than a high school education, falls into one of two earnings brackets: less than $25,000 or $35,000-$49,999 and lives in a household of five people.

• The person with the highest percentage is:
  • A Hispanic or Latino female who is 18-24 years old, with some college education or an associate's degree, earning less than $25,000 per year and lives in a household of seven people.
• The person with the lowest percentage is:
  • An Asian male who is 65 years or older with less than a high school education who earns $200,000 or more and lives in a household of two people.
• The person who has experienced the biggest percentage point decrease since 8/31/20 is:
  • A White male who is 45-54 years old, with a high school or GED level of education, earning $100,000-$149,999 and lives in a household of six people.
• The person who has experienced the smallest percentage point increase is:
  • A Black female who is 25-39 years old, with less than a high school education, earning less than $25,000 and lives in a household of six people.

Observations

Very Difficult

Somewhat Difficult Paying Regular Expenses

A Little Difficult Paying Regular Expenses

No Difficulty Paying Regular Expenses

Closing Thoughts

• The purpose of this “composite picture” exercise was not to pinpoint people who fit the description.
  • It is intended more to highlight the fact that difficulty in paying regular expenses is not a homogenous event throughout the population.
• What the individual and composite data does highlight is that the percentage of people experiencing some level of difficulty paying their regular expenses has grown.
• I have discussed my belief that we have a bifurcated economy and that the bifurcation can be measured in different ways.
  • The five-part series highlighted the bifurcation through five different “lenses”.
  • Today's analysis highlights the bifurcation a different way.
• Even on a composite basis, there is not a clear theme about the type of person who is suffering the most difficulty in paying regular expenses.
• Some may question whether some of those composite people really exist.
  • The one that stands out is the person with the smallest percentage decrease in the No Difficulty category (Asian male who is 65 years or older with less than a high school education, earns $200,000 or more per year and lives in a household of two people).
• You may say that is totally unrealistic.
• I would simply suggest that, as I thought about that, the person who comes to mind that could fit that description would be a successful small business owner who built their business from the ground up based on a skill they had rather than education.
• My point is that, as long as your thought processes have been stimulated and rational discussions occur, then better understanding of the situation may be achievable whether the composite “pictures” are completely accurate or not.
• Not to sound like a broken record, but the composite “picture” highlights the message that I have repeated on several occasions (not my original thought): we may all be in the same storm, but we are not all in the same boat.
  • To add to that message: we may not all be in the same storm at the same time.
• For some, the economic “weather” is fine, and so is their financial “boat”.
• For others, the economic “storm” has already arrived, and they are struggling to keep their financial “boat” afloat.
  

Economic Data