Are You Better Off Now Than You Were Four Years Ago?

A quick look at the graph above would indicate the answer is no. Income is lower and prices are moderately higher. Home prices have fallen and the poverty rate has risen. The odd man out in this scenario is consumer sentiment which has risen sharply compared to four years ago (although still not near the 1996 baseline).

The answer to the disparity between reality and consumer sentiment may be that  consumers are looking at recent trends as opposed to comparing two snapshots in time. Four years ago we were in the midst of a recession whose worst effects were yet to come. Today we are in a very slow economic recovery. Whether the pace of that recovery is enough to reassure voters who aren’t as well off as they were four years ago remains to be seen.