Here’s why many Americans feel bad about the economy.
First, GDP – a measure of the overall economy – has been growing at a declining rate for the past 35 years.
The blue line below is the year-over-year percentage change of GDP … the red line is my eyeball trend line – attempting to factor out recessionary dips.
The boxes are roughly the Clinton years (green box), the Bush years (orange) and Obama years (red).
GDP growth for the past 10 years has been less than 5% year-over-year.
Let’s dig a little deeper …
Real GDP per capita – which takes inflation into account and normalizes for population growth – has been increasing the past couple of years from the financial crisis trough … but is below where it was both 5 and 10 years ago.
Said differently, there’s less average aggregate real income available for each American man, women and child …
As is often headlined, real median household income is now (in 2016) where it was roughly 20 years ago (in 1996).
Again, note the sharp fall-off from the pre-financial crisis level … and then, the slow and apparently stalled recovery.
In a nutshell, that’s why many Americans don’t feel that ‘happy days are here again’.