Can American Confidence Last Until Inauguration Amid Stimulus Distribution Problems? – Councilor Forbes
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Americans are feeling particularly confident this week as details of a third stimulus package begin to emerge and preparations continue for inauguration day, despite a day of violence on Capitol Hill last week.
Consumer confidence hit its highest level since September at 54.5, according to the Forbes Advisor-Ipsos Consumer Confidence Weekly Tracker.
The poll, made by Ipsos, measures consumer sentiment over time.
American confidence at this point – in the midst of a recession and on the eve of a presidential transition – is significantly higher than it was when we last faced comparable circumstances in January 2009. So As the two recessions are far from being carbon copies of one another, the difference reveals how this economic downturn unevenly affects Americans.
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How long will the $ 600 Stim Control Confidence Boost last?
While overall consumer confidence and confidence in job security holds up in the mid-1950s (out of 100) this month, it is much more optimistic than in January 2009. At that time, the Job confidence was just over 40, with overall confidence at just 37.8 – one of the lowest points since Ipsos started tracking consumer sentiment.
But the optimism of 2021 may hide a growing divide between low-income and high-income Americans.
In a speech this weekLael Brainerd, an economist at the Federal Reserve Board of Governors, said unemployment among workers with the lowest wages is likely above 20%, while workers in the top quarter of employees are likely below 5%. These Federal Reserve estimates make it clear that economic recovery will be K-shaped, where the richest Americans will emerge from the pandemic largely unscathed, but the poorest Americans will struggle to get back on track.
Recovery from the 2008 crash, meanwhile, was v-shaped, with a larger portion of the population experiencing steep and sudden decline before a rapid recovery.
According to the Consumer Confidence Weekly Tracker, full-time workers and households with incomes over $ 100,000 are significantly more confident about their finances and the economy, with the unemployed and households earning less than $ 50,000. feeling significantly less confident.
More than half (54%) of those polled agreed the economy would recover quickly once restrictions on coronaviruses are relaxed. But 46% of people still said it was likely that they, a family member or a friend would lose their job in the next six months due to the economy, the same level as last week. Last week, nearly one million (965,000 people) filed the first unemployment claims, an increase of 181,000 over the previous week.
The survey was conducted as more and more eligible households are receiving their second stimulus payments. The Treasury Department said this week that 100 million stimulus payments were distributed, although hiccups with tax preparation services hindered the process and millions of recipients are still waiting for their funds to arrive. In the two months following the passage of the first stimulus plan in March 2020, the Treasury and the IRS distributed 159 million payments.
Americans reported an increase in confidence in their purchases, with 49% saying they feel more comfortable doing household purchases than six months ago, likely due to stimulus payments . But the deadline for sending the second stimulus payments is January 15, which could force many people to claim credit on their 2020 tax return instead of receiving money for immediate expenses.
Democrats feel good ahead of Biden’s inauguration
This week, Democrats hit their highest level of confidence since the start of the pandemic, at 55 out of 100, while Republicans hold steady with an index of 57.3. Members of both parties saw an increase of about a point from last week in the wake of the Capitol Hill riot.
This week’s confidence levels for each party are very different from before the election. Beginning of October, during the coronavirus epidemic in the White House which included President Trump, confidence among Democrats dropped to around 40. Meanwhile, Republicans reported confidence above 60. That difference worsened this fall, with a share of nearly 50-50 the week after Joe Biden was declared the winner of the election in November and then a possible uptrend for both parties.
Will this trust last? President-elect Joe Biden is expected unveil your recovery plan today, which can boost the mood of liberals, moderates and conservatives. But the threat of far-right violence in Washington, DC and elsewhere in the country may dampen moods nationwide.
Survey Methodology: Ipsos, which surveyed 912 respondents online on January 12 and 13, provided the results exclusively to Forbes Advisor. The survey is conducted weekly to track consumer sentiment over time, using a series of 11 questions to determine whether consumers feel positive or negative about the current state of the economy and its direction. future.