, Columnist
American Consumers Are Starting to Hit Their Breaking Point
Evidence is mounting that the days of pandemic-era profligate spending may be over in a bad sign for stocks and corporate bonds.
Consumers are pulling back.
Photographer: Joe Raedle/Getty Images
This article is for subscribers only.
Signs are emerging that the resilience of American consumers is rapidly waning, potentially undermining one of the few remaining pillars supporting the bull market in equities.
U.S. households have until recently mostly absorbed higher prices on everything from coffee to chicken to clothes, helping companies maintain fat profit margins despite higher input. But that doesn’t mean consumers were happy about paying more for the same goods, which is why the University of Michigan’s sentiment index has steadily deteriorated to the lowest since 2011.