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The Impact of Three Rounds of Fiscal Stimulus is Waning Already

Incomes declined in September. Here's a breakdown of what's going on.
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PCE, Personal Income, PCTR 2021-09

In my previous post, Real Personal Income Declines 1.6% in September, I noted real (inflation adjusted) income was down 1.6%.

Personal Income 2021-09

The lead chart in this post shows a breakdown of nominal income. 

Fiscal Stimulus

Three rounds of fiscal stimulus clearly stand out. 

Personal Current Transfer Receipts (PCTR) includes things like the SNAP (food stamp program) but also pandemic aid checks under both Trump and Biden.

  • Personal Income excluding PCTR was $16,580 billion in September of 2021 vs $15,798 billion in February of 2020 pre-pandemic. 
  • PCTR  was $3,913 billion in September vs. $3,208 billion in February of 2020.
  • PCTR Other was $894 billion in September vs. $506 billion in February of 2020.

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Fiscal stimulus is still ongoing, but waning. That stimulus and the wealth impact from the stock market is what kept consumers spending.

Meanwhile, the economy is slowing, mortgage rates rising, and tax hikes are on the way. 

For discussion of the current picture, please see MishTalk TV Episode #3: Lacy Hunt Still Bullish on Treasuries.

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