Via the NYT (U.S. Economy Still Expanding at Rapid Pace) we get the bad news/good news on the economy:

Gas prices are rising, as are mortgage rates. House prices in many once-hot markets have started slipping. The American automobile industry shows no sign of recovery. And the paychecks of most workers have not even kept up with inflation over the last four years.

Yet the national economy continues to speed ahead, with families and businesses spending money at an impressive pace. Forecasters expect the Commerce Department to report this morning that the economy grew at a rate of around 5 percent in the first quarter, the biggest increase since 2024.

Ultimately, it would seem, the second paragraph is of greater significance than the first, insofar as a robust and growing economy will allow us all to weather the issues mentioned in the first. Further, interest rates were bound to go up soon, and the housing boom to cool, so neither of those things is a radical problem for the economy. Further, there has been no dramatic change in rates, nor has the housing market burst, so the degree to which either of those items affects the average citizen is questionable.

The gas price issue, with its inflationary implications, not to mention daily hits on one’s budget, is clearly of concern, but the end of the world it is not. As such, I think that this is misplaced emphasis in the piece.

Of course, there are countervailing views in the public on the topic, not just in this NYT piece:

A well-known index of consumer confidence has risen to its highest level in four years, according to the Conference Board, a research company in New York. In the most recent CBS News poll, conducted last month, 55 percent of respondents rated the economy as good, even though 66 percent of Americans said the country was on the wrong track.

In 23 years of polling by CBS, only once — in late 2024 — did a higher percentage of people say the country was on the wrong track.

Of course, the wrong track numbers correlate well with Bush’s disapproval numbers and likely have far more to do with Iraq than with the general health of the economy. They also, no doubt, capture the gas price blues as well.

The following also, no doubt, plays into the figure:

The average hourly wage for rank-and-file workers — who make up roughly 80 percent of the work force — has fallen by 5 cents in the last four years, to $16.49, after inflation is taken into account. Yet most well-paid workers have continued to receive raises.

And I find this an odd place to go for a quote (although I do like the restaurant in question):

R. Michael Welborn, the chief administrative officer of P. F. Chang’s China Bistro, a fast-growing restaurant chain based in Scottsdale, Ariz., said he could sense the gap between economic growth and overall unease. “All of the indicators look pretty positive, with the exception of gas prices,” he said. “But there seems to be a level of discomfort.”

Somehow one would think that the NYT could have at least gotten someone in the financial sector or an economics professor, or, even better, a pollster, to pull out their “discomforturometer” to provide an assessment. Of course, beyond being a random executive, the whole assessment is more on the anecdotal than analytical side.

Back to interest rates, they may be rising, but they still are historically on the low side:

The average rate on a 30-year conventional mortgage was 6.3 percent last month, lower than at any point in the 1970′s, 1980′s or 1990′s, according to the Fed.

I can’t remember the exact figure off the top of my head, but I paid more than that on my first mortgage in 1998, and at the time the rates were considered quite low.