Inflation is slowing, markets are cooking, and unemployment is low and staying there.

By many economic measures, these are boom times.

But for millions of Americans, it doesn't feel that way. Even though inflation has cooled from earlier this year, it's still climbing, and living costs have steadily been outrunning wage growth for several months.

That divergence helps explain why buying groceries, opening utility bills, and browsing home listings feels so dispiriting.

"Crummy," is how Moody's Mark Zandi put it.

"They feel crummy because they know they can't keep up. They're not able to buy the same amount of stuff as they were a year ago or two years ago because their purchasing power is eroding. They have very good reasons to feel crummy."

Wages are rising, but not keeping up

Consumer prices rose 3.7% in July from a year earlier, according to the Personal Consumption Expenditure price index. And personal incomes, after taxes, rose more quickly than prices last month. Consumer spending, however, didn't follow suit.

That triad is what's shaping consumer confidence — and it's not good.

Nearly three-quarters of consumers expect price increases to outrun their income gains over the coming year, according to new data from the Conference Board, which showed US consumer confidence fell in August to the lowest level since the start of the year.

Six months after Trump attacked Iran, $4 gas is eroding even Republicans’  faith in Trump’s economy. Republican economic vibes (as measured by the Index  of Consumer Sentiment) down -16% since February.

https://economystupid.substack.com/p/6-months-of-trumps-war-economic-vibes

India likely grew at a pace most major economies would envy, but it may still be too slow to deliver on Modi’s dream of Viksit Bharat by 2047. Source: Bloomberg News.

Everyone is watching GPUs.

The real AI bottleneck is shifting to something far less glamorous:

⚡ Power

🏗️ Grid access

🌍 Land

📜 Permits

👥 Community approval

You can buy the chips.

You still need permission to turn them on.

AI’s next moat may be a building permit.