Disposable (after tax) income rose 0.5 percent in March. Real (inflation adjusted) income rose 0.2 percent. The rise in spending outpaced the rise in income.
Consumers went on a bit of a spending spree in March according to the BEA’s Personal Income and Outlays Report.
Income
- Disposable personal income (DPI), personal income less personal current taxes, increased $104.0 billion (0.5 percent) and personal consumption expenditures (PCE) increased $160.9 billion (0.8 percent).
- Real DPI increased 0.2 percent in March and real PCE increased 0.5 percent; goods increased 1.1 percent and services increased 0.2 percent.
Prices
- From the preceding month, the PCE price index for March increased 0.3 percent.
- Prices for services increased 0.4 percent and prices for goods increased 0.1 percent.
- Food prices decreased less than 0.1 percent and energy prices increased 1.2 percent.
- Excluding food and energy, the PCE price index increased 0.3 percent.
Real PCE
- The 0.5 percent increase in real PCE in March reflected an increase of 1.1 percent in spending on goods and an increase of 0.2 percent in spending on services.
- Within goods, the largest contributors to the increase were gasoline and other energy goods (led by motor vehicle fuels, lubricants, and fluids), other nondurable goods (led by recreational items), and food and beverages.
- Within services, the largest contributor to the increase was health care (both outpatient and hospital services).
There is nothing about this report that hints toward rate cuts by the Fed.
Year-Over-Year PCE Price Inflation
Year-over-year PCE price inflation went from 2.5 percent last month to 2.7 percent in March.
The Fed will remain on hold.
2024 Q1 GDP Underperforms Expectations
Yesterday, I reported 2024 Q1 GDP Underperforms Expectations at 1.6 Percent vs 2.3 Percent Expected
Slowing growth but rising inflation is the worst combination for the Fed and for President Biden’s reelection hopes.
Tax refunds?
1st time I maxed out ONE of my cc, had to make mid-month payment
bit over $15k for month
—-
haven’t settled up this month but now using 2 cc’s
just did couple invoices – man gonna be another painful month
I’m paying for work up front and will get reimbursed down road(end summer)
30% ‘inflation’ in materials(don’t forget govt gets % sales tax)
at least this month it’ll be under $10k on cc
gonna have to raise hourly rates $45 an hour ain’t enough anymore
0.5% is a “jump” now?! lol
Forget regular jobs, belly-up to the Union buffet from the WDC uniparty: defense, green, DEI, etc. Comes with healthcare, childcare, gendercare too. It’s the law so MAGA can’t stop it.
Pick a location and start collecting:
link to screeningtool.geoplatform.gov
More at: Justice40 Initiative
This is good news. As the millions of spendthrifts waste away all their money and hit the wall losing all, all kinds of stuff is piling up around here selling for pennies on the dollar or even less. I can get anything I want for practically nothing.
Dear Repo Santa:
I want a flite board and a dirt bike, and an Airstream, and some new rifles.
Your friend, Chester.
A fire sale on Big Hoss Truks is coming.
The attitude of most people is “Why bother to save?” when the money loses value faster than you can save it.
The last 10 years, they’ve been right.
As more skilled labor retires from the labor force there will be larger and larger labor gaps. Wolfstreet has a nice synopsis about services (labor intensive) driving the spend over goods.
From here on out it’s all about labor, labor and labor. Free money of $120b/month+ for seniors and wage increases for everyone else lead to…..
“It’s turtles all the way down and inflation all the way up!”
I wonder when the people that actually work will see some tangible benefit. I don’t think they like being enslaved to a bunch of boomers.
It’s all coming to a head soon enough. good video that talks about young people being angry.
link to youtube.com
Correction is possible if young people vote for fiscally conservative Republicans instead of profligate Democrat socialists.
Thanks for sharing. I’ve been saying this for a few years and nice to hear Scott Galloway say it all so clearly
Since the dawn of time children have taken care of their parents after the parents raised them (think of 100 years ago when multiple generations lived in same household).
Do you think they felt enslaved to their parents back then?
Biggest change from then to today is the cost of daycare which used to be provided for free by grandparents.
This constant BS about boomers, or any generation for that matter, is moronic.
You make it sound like Gen Z and millennials passed through some benevolent membrane from another dimension comprised of 100% altruistic people. The opposite happened to the boomers according to you.
STOP PLAYING THE VICTIM CARD!!!!
Signed, an annoyed Gen X’er.
No, WG, boomers, nor any previous generation, EVER approached 100% altruistic. It’s neither human nature nor a foundation for survival. At risk of sounding less than kind, younger generations seem to have gravitated ever closer toward an entitlement attitude. It’s the fault of my boomer generation that our unprecedented wealth was squandered on giving yours the possessions our parents couldn’t afford to give us. We didn’t teach our children to accept, embrace and revere the concept of “earn” and I apologize for me and my ilk. I hope your generation embraces and teaches the concepts of integrity, fairness, and, yes, earning to your offspring.
“As more skilled labor retires from the labor force there will be larger and larger labor gaps.”
I’m this guy (substation and power plant automation & control). I make more than many of the engineers and lower level management at my company, but I have to take responsibility for the jobs I commission AND I have to be physically present every day in the plants. We can’t find even semi-qualified folks from other utilities to come do this work, even with $20k bonus…it’s crickets.
Engineers don’t want to come over to my shop. I get it, they have their degrees. But they also have the freedom to work from home and come and go mostly as they please (so no to minimal daycare costs). The other day I was working via Teams with an engineer who had to leave at 11AM for a haircut appointment!
Younger craft folk don’t want to come to my shop. It would require a great deal of off the clock “required self-training” and frankly they don’t want the additional responsibility. They seem to value the progressively changing “quality of life” first mindset.
Logically you might think my company would up the wage and benefit package to entice folks to do this work. But they don’t want to pay skilled labor dramatically higher wages.
The answer seems to be to hire more project managers to properly document the ever-increasing inefficiency so those costs can more easily be passed on to the customer.
Alternatively, the company could contract out the work. This will keep full time employee count down, but they’ll pay through the nose to get the work done. I think I’ll retire and contract back part time at higher wage. At least I’ll be able to schedule a haircut at 11AM on Tuesday!
More difficult for rate cutting? Biden just told Powell what to do if he wants to be reappointed.
It is not Biden’s call
The market expects a cut; not cutting hurts the market and may influence the election; therefore, JPow will cut (consequences be dammed).
David, who do you think wields the most power – Fed Chair or POTUS? Which has the ability to act as they please with no oversight?
There’s another pandemic coming in 2025-26. Better live well while you can. Yesterday is a memory and tomorrow isn’t guaranteed as humanity speeds towards its permanent decline.
That cheered me up. Thanks!
Covid turned out to be not that bad… but if something really deadly arises, our moron population will spread it so they can virtue signal for qanon.
On the plus side, I’ve Identified most of them in my circle, and am pretty good a spotting them in the wild now.
There are still a lot of “chumps” that are willing to believe the BS from the MSM and government agencies. Unfortunately there are a lot of people that didn’t do their own research about the vaccines and they are paying the price with their health problems. Excess deaths are also part of our labor shortage problems which affects the economy.
Is the March increase an annual abberation due to income tax “windfalls” being spent?
Isn’t this the purpose of credit cards?
This is becoming a Thelma and Louise/YOLO economy. Borrow and spend until they stop you.
How did that end up for both of them?
Same way it does for all of us, eventually. At least they left a smoking crater.
Yeah, just print more money, float more debt. Joe told me that he brought inflation down so spend more!
Can attest. Saving money in this economy has become quite hard.