Signs keep accumulating that U.S. consumers are in trouble. Investors are paying heed.
The latest warnings came from two packaged-food giants on Thursday, PepsiCo and Conagra Brands. Both reported weak quarterly results and said they see U.S. shoppers under pressure.
Pepsi said sales volumes fell 4% from a year earlier in its Frito-Lay North America business and 3% for North America beverages . . .
Meanwhile Conagra, whose brands range from snacks such as Slim Jim to frozen meals such as Marie Callender . . . . said organic sales fell 2.4% on-year in its fiscal fourth quarter
Seems to me if wages really were keeping up with inflation then I wuld not be seeing these near daily reports of companies with reduced sales volume.
Yet day after day, I read stories like this
and day after day, the left tells me *“wages kept up with inflation”
and “inflation moderates but the right ignores that.”
July 11 (Reuters) - Conagra Brands forecast annual revenue and profit below analysts’ estimates on Thursday, as cash-strapped consumers turned to cheaper pantry staples for their at-home meals. . . .
Despite more consumers preferring to eat at home rather than dining out, the packaged food industry has struggled with volumes as higher living costs have driven people to seek cheaper alternatives. . . .
The 1.8% volume decline seen in the fourth quarter was in line with the prior quarter . . .
. . . .volumes in the snacks category remained weak, falling 3.6% in the quarter . . .
No I don’t.
It is happening among non-food items,
entire store chains and entire industries.
It’s also not a “top10%” thing.
Best guess:
It appears that homeowners with lots of equity and 3% mortgages are buying trips, (travel is up 9% on top of double-digit growth last year),
but the Chef Boyardee class is shopping at Walmart, switching to generics and running up their credit cards.
I blame the Fed (not Biden),
but what we are a seeing is a very very expensive program of welfare for the upper-middle class being paid for by waitress moms and Uber dads.
Every single day, the actual actors in the economy are saying “travel is booming, upper-half stuff is booming, but wages have not kept pace with inflation we are seeing that in food sales, in clothing sales, in store choices and evething else.”
This is not about “the always poor.”
This is about a broad class of (mostly young) middle class folks who just are not making it, and they are “not making it” in a way that is likely to have long term or even permanent impacts of their standard-of-living.
Here is a graph of the UMich Index of Consumer Sentiment
(released today)
for reasons I don;t understand it only goes back to 2014 or so.
I’ll look for a long-term chart.
Keep in mind, today’s number (historidally low in its own) includes both the recenlty wealthy home-ownng and IRA owning class, and the large swath of folks who for age or other reasons missed out.
I came out of retirement for the first time in 11 years and am now working full time. Gotta save up for that retirement boat and can no longer do so without employment.
2 years ago I was paying an insured crew of 3 to help me replace my roof.
The economy sucks, and no amount of retard tantrums from mentally unstable internet dependas is going to change that.
and the rest just kinda found their own way in the great middle class in a land of opportunity.
But now . . . if you owned a home and had an IRA by 2022 you are enjoying life and taking trips, but if you didn’t —> you are rapidly becoming no different (ecnomically or behaviorally) than the permanently poor 10%.
If wages really were keepng up with inflation we would not be seeing a (new) switch from Cheetos to generic Cheet-os from Pepsi to Sam’s cola, from Publix to Walmart, from name-brand clothing to store-brand clothing, from paying with debit to paying with credit etc. etc…
I highly recommend people keep purchasing store brands, minimize purchasing pop and snack foods and Chef Boy R Dee and packaged frozen meals. I’m here to tell them it adds up over decades and you end up with way more money in your own bank account and less in Con Agra CEO pockets.
Or maybe you want people to adopt your narrative and stop dealing in the reality that people don’t want to spend their money on Cheetos and Chef Boy R Dee like Gramma did.
Biden’s economy only works for wealthy progressives. There’s a story like this on a daily basis and Democrats keep laughing and blame grocery stores.
(Although I assign most of the blame to the Fed. Biden’s biggest fault is putting his head on the sand, and trying to spin what he should be trying to repair.)
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