We finally have income and inflation data for September. I am looking ahead.
Please consider the much delayed Personal Income and Outlays report for September 2025
- Personal income increased $94.5 billion (0.4 percent at a monthly rate) in September, according to estimates released today by the U.S. Bureau of Economic Analysis. Disposable personal income (DPI)—personal income less personal current taxes—increased $75.9 billion (0.3 percent) and personal consumption expenditures (PCE) increased $65.1 billion (0.3 percent).
- Personal outlays—the sum of PCE, personal interest payments, and personal current transfer payments—increased $70.7 billion in September. Personal saving was $1.09 trillion in September and the personal saving rate—personal saving as a percentage of disposable personal income—was 4.7 percent.
Changes in Consumer Spending
Personal Income and Real Personal Income
Personal Income Notes
- Personal Income: 0.4 percent
- Disposable Personal Income (After Taxes): 0.3 percent
- Real Personal Income: 0.1 percent
- Real Disposable Personal Income: 0.1 percent
- Real Personal Income Excluding Transfers: 0.1 percent
There are only three problems with the above chart and data. All three “Real” (adjusted for inflation) measures are bogus because the BEA, like the BLS assumes increases in homeowners insurance and property taxes don’t count as expenses.
Reported Inflation Year-Over-Year
- PCE: 2.8 percent
- Core PCE: 2.8 percent
- CPI: 3.0 percent
- Core CPI: 3.0 percent
Those numbers do not include year-over-year changes in property taxes or homeowners’ insurance.
Looking ahead to 2026, I expect big jumps in medical insurance due to Obamacare price hikes and subsidies. Those hikes will impact PCE (the Fed’s preferred measure of inflation) more than the CPI.
I will report on this separately.
Related Posts
August 11, 2025: Is Homeowners Insurance Understated in the CPI? Shop Around!
Our Insurance went up by $2,000. Then another $2,000. Here’s our story.
August 12, 2025: Where Do You Spend Money on Food? How Screwed Up Are the BLS Weights?
Does the BLS match your budget?
Big increases in medical costs derive from the substantial raises demanded by striking healthcare workers earlier in the year.
Mish’s comments regarding the sham of “Real” measures are correct. It also applies to Real GDP. Real data allows institutions to re-evaluate past data to suit a present narrative. 10 years ago, Q4 2015 real GDP growth measured 0.5 and 0.6 in Q1 2016. Two consecutive very low readings were a problem, if they were negative, it would meet the definition of recession. If the bogus inflation measure for those quarters wasn’t 0.4 and 1.1 percent, real GDP would have been negative. Sometime after 2018, real GDP measures were altered, as these two GDP quarters now read 0.7 and 2.3 respectively. Consecutive low readings were eliminated. Obama’s last term in office go down in history as economically successful.
But, revised GDP data now doesn’t justify why it was necessary for Yellen to lower 10-year Treasury yields to match the lows from Bernanke’s mortgage crisis bailout, for the 11 months leading to the 2016 elections. The repurchase of these maturing Notes are the reason the Fed seeks to lower rates in 2026.
Our ACA insurance this past year was about $750/mo. Same insurance next year is currently about $1200/mo.
Subsidized numbers? Are the unsubsidized ACA premium numbers more than your local area rents?
So you’re out $5400 for the year, this is what MAGA calls winning. Lots of stuff you could buy with $5400. That’s about 200 shares of SCHD for me.
So I should pay the difference?
And insurance buys nothing. Most is vaporized and it’s a product you pay a lot for but you never want to use it.
Still no significant inflation from tariffs.
I love the parsing of words, “still no significant inflation…”
At least you are acknowledging tariffs cause some inflation now. Guess you had to since Trump admitted to it and that puts you in an awkward position claiming it doesn’t.
That’s a baby step, let’s see if you man up in six months about it when inflation explodes.
Consensus is that the tariffs increased inflation by 0.3-.05% over the year so to me and them that is not significant especially when some here were predicting tariffs would be much much higher. That didn’t happen.
Consensus of the piggies…
Many companies are taking billion dollar bottom line hits due to tariffs. Likely show up in reduced consumption and layoffs.
Tell me which companies are laying off because of the tariffs and also keep in mind domestically-producing companies could increase payrolls.
Study it out: WARN Layoff Data | WARN Database
The CRB commodity index is breaking out
CRB Commodity Index – Price – Chart – Historical Data – News
Marie Antoinette has apparently been reincarnated as a writer for the Washington Post as there’s been a flurry of ‘let them eat cake’ stories lately.
“Why you may not want lower prices as much as you think you do”
“Though Americans might be clamoring for relief on groceries, housing and energy costs, economists say there’s a bigger downside to falling prices.”
“Actually, today’s food prices are a bargain”
I’ve skimmed through the stories and what I learned is you can prove anything if you use the right facts and figures provided by the BLS.
Income up 251% but food only up 91%. What’s the problem?
I saw that idiotic post
Those with Trump Cult Syndrome pass around the bogus “facts” to support their Dear Leader.
The Feds should be glad I’m not on Luigi’s jury.
I think as people have less and less to lose, we’ll see more like him.
They’ll call it terrorism, but it will be war on the corporate overlords.
Private worker wages up 5.8% in Sept, up from 5.2% and highest since March 2024.
This further drives home what I’ve been saying for weeks. The labor market is strong due to lack of labor competition, and the Fed should not be cutting rates. The unemployment figures are irrelevant under these conditions. Retirements of 340,000/month, on average, are skewing the unemployment statistics.
Bank credit continues to expand on a past trend.
Bank Credit, All Commercial Banks (TOTBKCR) | FRED | St. Louis Fed
The solution is the 1966 Interest Rate Adjustment Act. Drop policy rates while simultaneously draining reserves. That drains money while increasing velocity.
New data from NY Fed Consumer Survey on Dec 8:
The Fed should not be cutting rates yet! It’s madness!
Liberals often ask, “How could Americans support President Trump when he did X, Y, Z?!” The Washington Post went to extraordinary lengths to answer that by profiling a federal employee trying to navigate cuts by the Department of Government Efficiency while his wife was dying of cancer. The in-depth picture of the man’s life makes the damage inflicted by DOGE very real and helps explain the psychology of voters who put their faith in the president.
https://archive.fo/20250920101306/https://www.washingtonpost.com/nation/2025/09/20/trump-administration-resignation-offer-supporter/
The damage inflicted by mass illegal immigration is real. One can find damage done to people by governmental decisions by either political party. Leftist always like to say one is voting against one’s self interest if one is voting Republican, unless one is rich. California had the highest state unemployment rate in July, with state residents voting majority Democrat. State Democrats are known for fostering an anti business climate. What health care insurance do unemployed Californians have?
The necessity of any job should definitely be based on the personal circumstances of the jobholder first and foremost.
It’s called shaping the narrative. Optics count more than the facts.
I can picture a story on Foxnews.com profiling a Trump supporter whose entire family died because of Trump’s actions and now the guy is bankrupt and living under a bridge, but still wearing a MAGA hat and cheering every time Trump kills someone else.
Agree but I think you mean Trumpcare or perhaps Trumpcarelessness.
Rising health care costs are going to hit consumers, health insurance is a MUST for most people over discretionary spending (e.g. bitcoin, streaming services, dining out, etc).
Got PUTS?
You underestimate how stupid people are. They’ll rack up door dash on the visa until they can’t pay insurance.
I know full well how stupid they are, just bought puts on the nasdaq for june 2026. I may buy more next week, especially if the Fed cuts.
Good timeframe but watch out for the “Greenspan put”. The FED used to publish reserves weekly, but now they hide their “elephant tracks”.
Reserves of Depository Institutions: Total (TOTRESNS) | FRED | St. Louis Fed
and don’t forget the tattooos and new iphones
Stupid transcends generational boundaries.
Accountability is distributed much more sparsely.
Fabricated numbers that are not relevant to American families, farmers or workers.
The Fed dropping interest rates is not a great sign for Americans that do not participate in the stock market. As interest rates fall, money moves from the relative safety of treasuries into stocks to chase performance or yield. Risk rises exponentially when buying in to a market that is at record highs.
All of the job losses are lagging GDP and inflation data.
Local midwestern anecdote: One of my contractors used to wait three months for a build slot at our local truss factory. Now they are looking for slots to fill with orders.
Fed’s Favorite Inflation Indicator Continues To Show No Signs Of Runaway Tariff Costs
BY TYLER DURDEN
First things first, this is September data… so horribly lagged/stale… but, it’s all we have, so let’s dive in.
The Fed’s favorite inflation indicator – Core PCE – rose 0.2% MoM (as expected), which leave it up 2.8% YoY (as expected), slightly lower than August +2.9%…
On an annual basis, the headline PCE rose 2.8%, up modestly from 2.7% YoY in August (as expected). That is the highest since April 2024, but again remains in the range of the last two years…
…showing no signs at all of the runaway tariff-driven costs that so many establishment economists proclaimed was imminent.
Services costs (not tariff-related directly) attributed the most to the rising costs while Goods prices were barely positive…
The closely-watched SuperCore PCE slipped to +3.25% YoY…
Also trending lower overall, ruining the ‘Trump will kill us all with tariffs’ narrative.
Meanwhile, amid rising prices, income growth outpaced spending growth for a change…
This left the savings rate at 4.7%, unchanged from August and at lowest since Dec 2024…
One place where there continues to be tangible improvement is the divergence between private and government sector wage growth in September:
TL/DR: while this data is admittedly stale, it shows no signs of 1) tariff-driven inflation or 2) a suffering consumer.
What does Zero Hedge know about suffering consumers.
So … what is making the consumer suffer?
Except Tyler is wrong. As Mish points out insurance is not included in these numbers so all the impacts from tariffs on things that impact insurance such as materials for roofing, lumber, copper, aluminum, etc are not showing up.
So it’s easy to say this doesn’t cause that if you nit pick at one thing or two but looking at the overall picture, they are having a negative impact on everyone.
Mom & Pop bankruptcies are surging. I think there was a MAGA clown asking where the bankruptcies were a few posts ago. Here you go clown:
https://www.bloomberg.com/news/articles/2025-12-02/mom-and-pop-business-bankruptcies-hit-a-record-as-debts-pile-up
Those people certainly are being impacted by tariffs.