Percentage of people who believe we're currently in a recession: 74%
Percentage of people who think their personal financial situation is poor: 9%
Okay, I understand that these numbers don't measure the exact same thing. But this split is ridiculous.
I'm somewhat obsessed with these sorts of things. For some reason, people think that they're okay, but everyone else must be in trouble. Why?
Let me throw out some possible reasons (are we in the safety tree?)
1) People are nice and they are perpetually concerned about others. In fact, many feel guilt when they perceive they are doing better than them.
2) The media constantly tells them stories of people struggling. A lot of people just believe them. The local news constantly shows murders and fires, so a lot of people don't want to come to the city. Yet I'm able to generally avoid being shot and catching on fire most days.
3) People recognize merit in personal situations. ie “That guy I work with shouldn't have a job” but they project good qualities on the population “it's so sad they're out of work”. Some of them should be out of work. The unemployment rate is around 5%. There's no way 95% of this workforce should be able to hold down jobs. Most of them suck.
4) People are complainers. Especially Americans-at least lately. We have a 100 years of increase in the housing market, and when we get a bad year, we can't stop whining about it. We avoid being hit by terrorists for an impossible amount of time, so we complain that someone might be listening to our phone calls. We have the most prosperous society in the history of the planet, but the fact that you can “only” buy 80 pounds of rice, per person, per trip, at one particular store-is front page news.
The answer in the split of those stats might be one of those, or it might be something else. I'd love to hear your ideas if you have them. Email me at firstname.lastname@example.org, put “Stu Blog” in the subject line. Unless your idea is that people have perspective and realize that they're doing okay, but a two quarter decline of GDP is underway. That's just not possible.
By the way, which number is a better measure of reality? I tend to believe that the personal financial situation is a much better measure of how actual people are doing.
Mainly because, they actually understand their own situations, where the greatest economic minds in the world have trouble predicting recessions. Plus, in my experience, people will typically complain about their finances before they praise them. Everyone always thinks they should be making more money. Everyone always thinks they should have more. By the way, I should be getting paid more for this blog.
UPDATE: 74% of Americans wrong…at least for the moment. GDP grows by 0.6%, doubles estimates for Q1 2008. That doesn't mean a recession isn't coming, it just looks like it isn't here yet.