We are approaching the internet bubble territory.
Posted on 03/29/2022 7:25:25 PM PDT by SeekAndFind
Two years ago, slippers went stratospheric.
Normally, they sell in cycles. There is an “on” season for slippers through the fall and winter. Then, sales taper off during the warmer months.
But 2020 was different. Slipper sales that April almost doubled versus 2019.
The COVID-19 pandemic was in full swing. Folks were in no hurry to leave their homes. They were dressing for leisure, streaming entertainment, and saving their cash… And while we saw odd bursts in products like slippers, huge swaths of the economy suffered.
But today, a big thaw is coming to the global market. Travel plans are on the rise, spending is back – and a slumbering giant is about to return with new buying power…
It’s a demographic that has stayed quiet during the pandemic reopening. These folks preferred to play it safe while other consumers rejoined the in-person world.
That’s changing now. And the resulting economic growth could be massive.
After two years of isolation, older Americans are about to open their wallets…
Older Americans have been the most cautious since the start of the pandemic.
One way to see this is the Spending Momentum Index (“SMI”), a measure of consumer spending from Visa. The SMI measures the share of Visa cards that has increased or decreased spending compared to the same period a year earlier.
An SMI higher than 100 shows a stronger spending momentum from the year prior. An SMI below 100 shows weaker momentum.
From March 2020 to January 2022, the 25- to 44-year-old demographic had an average spending momentum of about 106.4. The 45- to 64-year-old demographic showed more restrained growth, for an average SMI of 101.1.
However, the spending momentum of Americans 65-and-up actually fell. Their average SMI was only 97.6 for the period, making older Americans the only demographic to spend less on average during the pandemic.
It makes sense. Older folks were the most at risk of severe illness. So they were doing less than anyone. And their spending dropped more as a result. That’s changing, though…
Visa’s newest data suggests the purse strings are loosening. This February, the older demographic leapfrogged 45- to 64-year-olds.
Older consumers are spending once again. And their pockets are deeper than ever…
We all know that stocks and real estate went on a tear in 2021. But what you may not know is that, between fall and winter, these assets pushed U.S. household net worth up by $5.3 trillion dollars. Total household net worth surged to a record $150 trillion…
Roughly 41% of this money is in the hands of Americans 65 and older.
This cash is burning a hole in these consumers’ pockets. And as they return to the economy, the impact will be huge.
Travel should be a big winner. According to AARP Research, 67% of adults 50-plus are planning at least one trip in 2022… with an average plan for four. And travelers plan to spend about a thousand dollars more than their pre-pandemic average.
But vacation spending is only the beginning…
Older folks will renovate homes. They’ll schedule medical procedures. And they’ll impulse-buy lots of stuff.
So get ready… We’re about to see what it looks like when two years of pent-up purchasing power floods into the economy. And it should be a powerful force behind stocks.
Good investing.
Uh-huh.
OMG this guy is really enjoying the kool-aid!!!
This poster is becoming a real Biden cheerleader. The only reason people will spend is because of inflation.
“After two years of isolation, older Americans are about to open their wallets…”
Here’s an older American who’s going on a dollar spending frenzy this year. I’ll be spending all those additional dollars trying to keep gas in the truck and food on the table.
He’s right. I opened my own wallet today...and handed the entire contents to the gas station cashier.
One way to see this is the Spending Momentum Index (“SMI”), a measure of consumer spending from Visa. The SMI measures the share of Visa cards that has increased or decreased spending compared to the same period a year earlier.
—
Another way to see it is people have run out of cash in their bank accounts and are racking up credit card debt.
We are approaching the internet bubble territory.
If the other 65+ are anything like me they are trying to turn their Fed Funny Money into preps and precious metals before they are only good for toilet paper. I give it to October.
I plan on making 10% more this year. And spending 12% more. That’s good, right?
We’ve bought solar lights. Chainsaws. Usb fans to run off external battery packs. Food. Shoes. Etc
Yield curve inversion today. The recession is in the mail.
Thank goodness, I got that 5.9% increase on my social security check. After my 18% increase in Medicare premium, I’m ready for any cost of living increase. Any increase that’s not above 2%, that is.
Hahaha my social security raise was 6.9% and I am trying to cope with 10-12% inflation. May be Biden will give me 12% raise next year?
Easter Bunny will be delivering pallets of cash to everyone this year, instead of eggs.
And Santa Claus will bring more.
I want some of the author’s feel good hopey stuff.
I guess he missed the inflation stock markey loss / correction / war scare thing.
Buy a wheel barrow soon. You will need it to go to grocery stores to carry enough cash.
I was going to give up steak anyway.
I do not think so. I am one of those old folks and we had to use our credit card last year for the first time Ever to pay our real estate taxes as they went so much!
This year I am afraid to see what our school will do with the high cost of gas . They may raise the taxes again!
We do not have deep pockets actually they are being drained by gas prices, taxes and the high cost of living.
And why would we want to go and buy more Real Estate when we can barley pay our taxes.
And taking Vacations are out. We still will not go out with Covid.
This is some article that is focused on a small audience The Very Rich Audience.
A lot of smoke and mirrors out in the Press these days. Very sad what our Country has become.
They should have given 21% like Government gave themselves.
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