Have you ever looked at the headlines boasting about explosive GDP growth, rock-bottom unemployment, and soaring corporate earnings, only to glance at your own bank account and wonder what planet those economists are living on? I know I have. Lately, it feels like the economy is throwing a massive party that somehow forgot to invite most of us. Numbers look fantastic on paper, but the mood on the ground? Pure frustration. This strange disconnect has even spawned a term that’s starting to catch on: the boomcession.
It’s that bizarre situation where the overall economy appears to be booming, yet large swaths of ordinary Americans feel like they’re stuck in a recession. Corporate boardrooms are popping champagne, stock portfolios are fat, but the average family is pinching pennies harder than ever. Why does this happen? And more importantly, why does it feel so much worse than the raw data suggests?
Understanding the Boomcession Puzzle
In recent years, traditional economic signals have flashed green across the board. Growth rates have been solid, sometimes even scorching. Business investment ticks up, trade balances improve in spots, and profits hit records. Yet when you ask regular people how they feel about their financial lives, the response is overwhelmingly negative. Consumer confidence polls have plunged to levels not seen in decades, even as the macro stats shine.
I’ve spent time digging into this, talking to folks from different walks of life, and the pattern is clear. The models policymakers rely on—built decades ago—assume one unified economy where growth lifts all boats. But today’s reality is fragmented. There are multiple economies layered on top of each other, and they don’t share the same fortunes.
The Classic Metrics vs. Lived Reality
Let’s start with the big picture numbers everyone quotes. Gross domestic product has posted impressive gains in recent quarters. Consumer spending holds firm, business formations surge, and joblessness stays low by historical standards. Inflation has moderated from its peaks, giving some breathing room.
Yet consumer sentiment indicators tell a starkly different story. Polls show people rating the economy poorly—sometimes at historic lows. In periods where wages grew similarly in the past, folks felt optimistic. Today, the same wage gains accompany deep pessimism. What changed?
The public is often right when their mood clashes with official stats. They’ve felt real pressures that models miss.
One clue lies in how we measure “consumer spending.” Many assume rising spending equals happier consumers choosing nice things. But a closer look reveals much of that spending isn’t voluntary or enjoyable—it’s mandatory, like taxes in disguise.
Hidden Costs Eating Into Wallets
Consider banking services. Banks offer “free” checking accounts and apps, but they pay savers far below market interest rates on deposits. That gap—where your money earns peanuts while banks lend it out profitably—gets counted as consumer spending in official data. It’s treated as if you’re happily buying a premium service.
Over recent years, this hidden fee has ballooned dramatically as interest rates rose but deposit rates lagged. Households effectively paid hundreds of dollars more annually to banks without seeing any real improvement in service. Yet GDP registers it as positive activity. No wonder people feel squeezed—their extra earnings vanish into these invisible drains.
- Health care costs keep climbing, often for the same or lesser coverage.
- Housing and utilities take bigger bites out of budgets without delivering proportionally better living standards.
- Everyday essentials like food show uneven price hikes depending on where you live or shop.
These aren’t luxuries. They’re necessities, and when their prices outpace wage gains for many, it feels like moving backward even if aggregate numbers improve.
The Reality of Spending Inequality
Here’s where it gets really interesting—and troubling. Not everyone experiences the economy the same way. Wealthier households snag better deposit rates, negotiate lower fees, and access premium services. Lower- and middle-income groups face the opposite: higher effective costs and fewer options.
Research has shown that poorer areas endure higher inflation for basics like groceries due to market consolidation. Health plans with sky-high deductibles leave many avoiding care, effectively reducing the value they get from spending. It’s a form of price discrimination baked into the system.
Imagine different classes operating with different “currencies.” Rich people’s dollars stretch further—maybe worth 105 cents on the dollar—while poorer ones might only buy 80 cents worth of goods and services. Aggregate wage growth looks fine, but for large groups, real purchasing power stagnates or declines. That explains the pinched feeling despite headline improvements.
In a truly fair system, we’d adjust metrics to reflect these varying dollar values across groups. Until then, averages hide a lot of pain.
Market Power and Its Role in Inflation
Another big factor is the rise in market power. When competition weakens, companies charge more without improving offerings. Banks hold deposits without passing on rate hikes fully because switching is a hassle—by design. Pharma raises drug prices, landlords push rents, and service providers add fees quietly.
These aren’t always obvious like tariff impacts, which get plenty of attention. But the effect is similar: higher costs without corresponding value. For working people, wage gains get funneled into these non-discretionary areas rather than discretionary fun or savings. The economy grows, but it doesn’t feel like progress.
In earlier eras, income growth translated to more of what people actually wanted—better homes, cars, vacations. Today, a lot flows to unavoidable bills, subscriptions, and overpriced necessities. That shift leaves many feeling the economy is rigged against them.
What GDP Really Measures—and What It Misses
At its core, GDP sums the market value of goods and services produced. It doesn’t judge whether those things improve welfare. Gambling revenue grows fast? GDP likes it. Software subscriptions replace one-time purchases? More recurring revenue, more growth. But does anyone truly feel richer from these shifts?
Many activities that once fell outside formal markets—meeting friends organically, sharing skills informally—now get monetized through apps and platforms. That counts as growth, even if quality of life doesn’t rise. Intangibles dominate more than ever, and their value is harder to pin down.
- Traditional growth once meant spreading basics like electricity and plumbing to more homes—clear wins for society.
- Now, much “growth” comes from extracting more fees, subscriptions, and data without proportional benefits.
- The moral assumptions baked into these stats don’t align with how most people view value.
Perhaps the most frustrating part is how policymakers still lean on these outdated frameworks. They see strong aggregates and assume everything’s fine, missing the tiered reality below the surface.
Fixing the Measurement Mess
To bridge this gap, we need better tools. Tracking real income after non-discretionary spending could reveal true disposable gains. Adjusting for price discrimination across income groups would highlight spending inequality. Experimental indexes already exist for subgroups like the elderly—why not expand that approach?
But metrics alone won’t solve it. The deeper issue is structural: an economy increasingly divided, where market power lets a few capture gains while others pay the price. Restoring competition, easing switching costs, and curbing exploitative practices could knit things back together.
Until then, we’ll keep seeing this boomcession dynamic—charts looking rosy while people feel the pinch. It’s unhealthy for society when growth becomes something to resent rather than celebrate. In my view, ignoring the warning signs in consumer mood risks bigger fractures down the road.
The economy isn’t just numbers. It’s people’s lives. When those lives feel harder despite “good” data, something fundamental has shifted. Recognizing that is the first step toward fixing it. And honestly, it’s about time we started listening more closely to what everyday Americans are actually experiencing.
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