{"id":346021,"date":"2025-07-24T10:33:38","date_gmt":"2025-07-24T15:33:38","guid":{"rendered":"https:\/\/michigandigitalnews.com\/index.php\/2025\/07\/24\/how-resilient-is-the-consumer-really\/"},"modified":"2025-07-24T10:33:38","modified_gmt":"2025-07-24T15:33:38","slug":"how-resilient-is-the-consumer-really","status":"publish","type":"post","link":"https:\/\/michigandigitalnews.com\/index.php\/2025\/07\/24\/how-resilient-is-the-consumer-really\/","title":{"rendered":"How Resilient Is the Consumer, Really?"},"content":{"rendered":"

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I see this constantly remarked upon, so I wanted to check the data.<\/p>\n

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Figure 1:<\/strong> Consumption, 2017$ (bold black, left scale), Services Consumption, 2017$ (tan, left scale), Retail Sales in 1999M12$ (light blue, left scale), all in logs 2025M04=0; U.Mich. Survey of Consumers expectations (red, right scale). Source: BEA, Census, BLS, U.Michigan Survey of Consumers, and author\u2019s calculations.<\/em><\/p>\n

Whether the consumer is surprisingly resilient depends on what one expected consumption to do given determinants (income, expected income, costs, uncertainty, wealth\u2026). Without a full fledged model, I can still observe that real consumption\u2019s trend has changed to flat. Since this series includes durables consumption expenditures \u2014 which has been distorted due to front-running tariffs \u2014 one can look to services consumption. This variable should be more sensitive to permanent income (in the Hall (1979) sense). Here, the break in trend is apparent as well.<\/p>\n

Finally, real retail sales have declined since March. With a June observation, we have a more recent reading on the consumer\u2019s behavior \u2014 and it\u2019s not indicating a strong resurgence.<\/p>\n

Consumer expectations have improved, and one would expect something of a rebound in consumption in July. However, expectations have not recovered to anything like November levels (77, compared to July preliminary 59).<\/p>\n

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[ad_1] I see this constantly remarked upon, so I wanted to check the data. Figure 1: Consumption, 2017$ (bold black, left scale), Services Consumption, 2017$<\/p>\n","protected":false},"author":1,"featured_media":346022,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[155],"tags":[],"_links":{"self":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts\/346021"}],"collection":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/comments?post=346021"}],"version-history":[{"count":0,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/posts\/346021\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/media\/346022"}],"wp:attachment":[{"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/media?parent=346021"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/categories?post=346021"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/michigandigitalnews.com\/index.php\/wp-json\/wp\/v2\/tags?post=346021"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}