Recession in US: The U.S. economy is performing well by most standards. However, a lot of people would contest this.
Affirm recently conducted a study with 2,000 respondents and found that about 3 out of 5 Americans think the country is now experiencing a recession.
According to the San Francisco-based fintech company’s June poll, the majority of respondents stated that a recession began approximately 15 months ago in March of last year and would continue until July of 2025. They cited rising costs and greater difficulty making ends meet.
Families have been severely impacted by persistent inflation, according to Vishal Kapoor, senior vice president of products at Affirm.
He stated, “Consumers are desperately looking for ways to feel in control of their finances with confidence in the U.S. economy at a low point.”
56% of people who answered a different Guardian/Harris poll in May said they thought the US was in a recession, even though the GDP has been growing for the past few years.
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The National Bureau of Economic Research says that a recession is “a significant drop in economic activity that is spread across the economy and lasts more than a few months.” There have been more than a dozen recessions in the last one hundred years. Some of them lasted up to a year and a half. In 2020, the Covid-19 epidemic started at the same time as the last official slump.
But no matter what the economy is like, a lot of Americans are having a hard time paying for basics because prices are so high. Most have spent all of their savings and are now relying on credit cards to get by.
It’s a “vibecession” here
The widening gap between the state of the economy and people’s perceptions of their financial situation has proven difficult for economists to reconcile.
Joyce Chang, chair of global research at JPMorgan, declared in May at the CNBC Financial Advisor Summit that we are in a “vibe recession.”
According to CNBC, Chang stated, “You’ve done extremely well if you own a home or other financial assets, but you’re leaving out huge segments of the population.”
Chang explained the recent disconnect by saying, “The wealth creation was concentrated among homeowners and upper-income brackets, but you probably have about one-third of the population that’s been left out of that.”
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More and more of those families are having money problems because they can’t keep up with rising prices and interest rates.
Credit card payments are being missed by more and more people every month. Based on a poll done by the New York Fed in May, 8.9% of credit card balances went past due in the previous year.
More middle-class families expect to have trouble making their debt payments in the coming months.
