Jerome Powell: ‘There Are a Lot of Good Things Happening on Household Balance Sheets’ Despite Americans’ Pessimism

EXCERPT:

POWELL: "So, I don’t know about the quarterly survey. That’s an idea we can take away and think about. In terms of how low and moderate Americans — you know, clearly we're suffering from — from high inflation. I think during the pandemic, the government transfers that happened were very meaningful. If you know, the service that we take showed that low- and moderate-income people were actually in very, very strong financial condition, I think now it’s a very hot labor market and you’re seeing high nominal wages and you’re starting to see real wages are now positive by most — by most measures. So I think overall, households are in good shape. Surveys are a different thing. Surveys are showing dissatisfaction, and I think a lot of that is just people hate inflation, hate it, and that causes people to say the economy’s terrible. But at the same time they’re spending money, their behavior is not exactly what you would expect from the surveys. That’s kind of a guess at what the answer might be, but I think there’s a lot of good things happening with one's household balance sheets and certainly in the labor market and with wages."