Despite record highs in major stock market indices and decreasing unemployment rates, many Americans express dissatisfaction and unhappiness, suggesting a disconnect between economic indicators and societal well-being.
In this week’s episode of Retire in Texas, Darryl Lyons breaks down the crucial topic of financial planning amid the backdrop of societal discontent and economic prosperity. He navigates the complexities of navigating personal finances in a world where perceptions often diverge from economic realities.
Show highlights include:
*Why, despite economic prosperity, many Americans express dissatisfaction and unhappiness, similar to sentiments observed during deep recessions.
*A breakdown of the data indicating that both the stock market and the economy are performing well.
*A look into a recent University of Michigan consumer sentiment survey that indicated that people feel as though they are in a deep recession despite economic indicators suggesting otherwise
*Why many individuals feel they are not receiving a fair shake, whether in their occupations or in broader societal structures.
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Transcript:
This is Darryl, CEO and co-founder of PAX Financial Group. Thanks for tuning into Retire in Texas today. Remember, this information is general in nature only. It’s not intended to provide specific investment, tax, or legal advice. Visit PAXFinancialGroup.com for more information.
Also, if you go to PAXFinancialGroup.com and then you go to the “Contact us” it’s on the upper right hand side. It’s the little yellow button. Just fill out that quick form. It’s really quick and you can connect with one of our advisors for a 15 minute conversation if you have any questions. So today, I want to talk about the big disconnect, and there’s a huge disconnect, and I’ve been watching this for a while now, and I want to talk about what this big disconnect is because it is material and you’ll relate to it.
And the media just can’t figure this one out because it’s so innate. And when I say innate, it’s something that requires us to to think about how God created us. So that makes it difficult for the media to try to unravel this disconnect, this peculiar conundrum, that exists in today’s economy. And so, I want to talk about that.
They’re baffled and they’ve been making guesses. And maybe you’ll pick up on this as you maybe turn on the media or the news from time to time. But this is it. And political pundits are talking about this, too. This is a big political talking point. But here’s the question and the conundrum: If the market, the stock market, and the economy are so good, then why are people so unhappy?
And you’re looking at me going, “I can tell you why.” And I know, I know. Hold on. I’ll get there. But it baffles – it is baffling the media. It’s baffling the current administration. If the market and economy is so good, why are Americans so unhappy? So, let’s go to the first part of this and ask ourselves is, is the market and the economy, is it good or not? Because that would be the first like presupposition that we’ve got to unravel.
It is. The market is good. It’s been very good. We have record highs in the American markets represented by all the major indices, S&P 500, Dow and NASDAQ, those are at record highs. The European market is at a record high.
Japan has had what they considered, you know, a flat economy, negative interest rates for years. They’re doing well. So not only the U.S. from a stock market perspective, but globally. So that’s the stock market. And it’s not completely disconnected from the economy. But I do like to, and I’ve mentioned this before, I like to distinguish between the two because there are different behaviors and different ways to measure success.
The stock market and the economy, I like to think about those as two different things because the measurements are different. And so, if I shift slightly over to the economy, yeah, that’s doing good too. Home sales have actually started to trend in the right direction. We had some, little stagnant for a while, but in the last couple of months it’s moving well. And we’ll see if that continues, but there’s a strong appetite for homes.
Sticking with the economy, unemployment, I mean, it’s below 4%. Honestly, that’s the longest stretch. It’s been under 4% for over 24 months. That’s actually the longest stretch since the 1960s. And then inflation, the other element of the economy that we have to pay attention to, that’s actually coming down quite a bit.
So not perfect, but generally speaking, the economy’s doing well. So not only is the stock market good, the economy’s good. So we’ve established that. And you could debate it, but I don’t really think the data is debatable. It really is good. Of course, how do you define good and is it great? Well, based on what I just told you, the economy in the stock market is pretty good.
So, why are people unhappy? And it’s not like they do surveys on the streets, grab microphones, fill out little forms. But the one I like to look at, I’ve looked at for several years, is University of Michigan does this survey of consumer sentiment. And so, they asked consumers a lot of questions and they’ve been measuring this for years, so we have points of reference.
And people’s sentiment right now, is the same sentiment people have when we’re in a deep recession. So, we’re not in a deep recession, but they feel like we’re in a deep recession. So the data is telling us that people are unhappy. Not just like our conversations on the street, but the data is telling us people are unhappy. And then, of course, adding fuel to the fire is the media. Media.
We take all this, this is where, I guess the mainstream media has a hard time connecting the dots because this is something that’s innate. The reason that Americans, I’ll say Americans – Texans, of course. But the reason is because there’s something inside of us that says there’s something wrong.
There’s something deep inside of us, and God gave us a conscience. And conscience, by definition, con-science means with knowledge. So, God gave us this conscience that tells us if something is right or wrong. It’s given to all of us. It’s a gift. Con-science with knowledge. We know intuitively, we don’t need University of Michigan to give us statistics. We don’t need the media to tell us. We know intuitively if something’s going wrong
Even when our investments are going up and the prices of our homes are going up. We still know in our gut because it’s innate from God, something is wrong. Now we can talk about all the elements of what’s wrong, but I’ll tell you, there’s two things that I’ve observed that people are latching on to, and I’m summarizing them and it may not define them completely accurately, but there’s two things.
One, we aren’t getting a fair shake. We aren’t getting a fair shake. I think a lot of people feel that things aren’t- things are rigged and it just doesn’t settle well with us, and let me give you an example. Let’s say you’re a restaurant owner in New York and you’re struggling already because, I use New York as an example, because there’s litter, graffiti and people steal, right?
This is, we know this is taking place. We’ve seen it with if you look at retail, we’ll see over the next 12 months, a lot of stores closing because of theft. But not only that, not only is that frustrating, but then you’re told that you’ve got an emissions issue with your pizza oven that you’ve got to resolve. And you’re thinking, I am paying an exorbitant amount of interest because interest rates went up on my credit cards and my lines of credit, and now you’re telling me I’ve got to spend ten, twenty thousands on an emissions thing for my pizza?
This is just not fair. As a small business owner, you’re saying, you’re making it too hard. Somebody’s getting rich and it’s not me. It just doesn’t feel fair. And so that’s one thing that we’re just struggling with, is that this idea of getting a fair shake, it feels off. Man, if you’re a police officer, you know, you feel like you’re not wanted and then you’ve got to fill out all this paperwork that just drives you nuts.
If you’re a teacher, you’re struggling because it feels like the parents and the kids are against you and you don’t get the support from the administration. Obviously, if you’re in the Border Patrol, you feel like you’re not getting a fair shake because you’re working your tail off. Nobody appreciates you. So, you can go by every occupation. That’s kind of how I think about it, is like each occupation, there are some that are getting a fair shake.
I mean, there’s a lot of attorneys that are happy. I mean, in a financial business, things have been going well. But generally speaking, a lot of industries are saying, “I’m working my tail off and I’m just not getting a fair shake.” What is – what does somebody have to do to win?
I can see some people making money, but it’s not me. And when somebody’s conscience says, “I just want to get a fair shake, I’m not asking to be rich. I just want a fair shake.” Then you’re unhappy. And so that’s the sentiment that we’re feeling right now. And that’s that’s real. And the second, second piece of our conscience that seems to be surfacing is that we generally don’t feel that we’re leaving the world better than we found it.
And, you know, we were given this garden to keep and cultivate and we just don’t feel like we’re leaving it better for our children. We scratch our head and say, “Can our kids even get a home? Can they even get a home?” In fact, one study, and I’ll put this in the show notes, said that 78% of Americans said they aren’t confident that their children’s lives will be better than their own.
That’s what our conscience is telling us right now. I don’t have to explain the whys behind that, you know, but I want to tell you this disconnect, because you may not have been able to define it in your mind, but you know it’s there. You know that something in your conscience is telling you that things aren’t right. The way I would describe that is, you know, things aren’t fair and, you know, you’re not leaving the world better than you found it.
And it’s not your fault. It’s the environment, and it’s where we’ve gone as a country when we disconnect from truth. So, I know that’s sobering. I don’t discount these issues. And at the same time, for those that know me, I have a ton of hope. So how do I reconcile this gray cloud with hope? And I do that because two reasons.
One, if you know me, I’ve read the Bible almost every day for the last 20 years, and I know this situation is no surprise to God. And two, I do what I can control. And so, I don’t live in a space where I manifest this unhappiness and let it paralyze me. And I don’t want you as well.
And when it comes to your investing, which we’re responsible for stewarding, we want you to know that the stock market has a long, long track record of climbing these walls of worry. So despite how we feel, despite how you feel, the market continues to go up regardless. And why is that? It’s because of another innate thing inside of us.
I talked about the garden. I mentioned it briefly to keep and cultivate the garden. We, in America specifically, have an innate desire to solve problems, to start businesses, to innovate. And because we have this desire and I know it, I feel it, it drives me every single day, because we have this desire. You look around and you say, I think things are fair and I think the world is going to be worse off.
But you look around and you see everyone participating in commerce, starting businesses, new ideas, new innovations, and as that continues and that system continues, and it will continue by the way. Nothing’s stopping it. The market will continue to go up. And in the short term, we’ll run into some patches. I’d be surprised if we went straight up between now and election time.
There’ll probably be some soft patches in there. But long term, long term, don’t discount your feelings because they’re real and it’s your conscience. Don’t discount those. But I want to be very clear that the market has a track record of climbing a wall of worry because of another innate thing that God gave us, which was, and which is, the desire for us to keep and cultivate.
And that is expressed through commerce, through small business, through innovation, and it ultimately leads to the stock market. So congratulations for you sticking it out over the last 12 months, or 24 months, because it’s been challenging. And I know your guts told you one thing and I want you to just acknowledge that gut. But don’t act on it.
So thanks for listening today. And as always, you think different when you think long term. Have a great day.
Show Notes:
Why Americans Are So Down on a Strong Economy – WSJ
The Fed’s Conundrum: Interest Rates Are Both Too High—and Too Low – WSJ
Here’s Another Sign of Europe’s Stock Market Optimism (wsj.com)
U.S. Home Sales Jumped 9.5% in February – WSJ
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