Consumer Spending Shifts from Goods to Services, Inflation Crushes Incomes, But “Real” Spending Hits Record | Wolf Street

It boils down to this: Total personal income from all sources have increased nicely, but all those increases plus some have been getting eaten up since last summer by raging inflation, and this happened again in March, when “real” income continued to decline. That’s the thievery of inflation.

“Real” (inflation adjusted) personal income from all sources, including income from wages and salaries, dividends, interest, rentals, farms, businesses, and government transfer payments (stimulus, Social Security, unemployment, welfare, etc.) fell by 0.4% in March from February, seasonally adjusted, and plunged by 17% from a year ago, when incomes were inflated by stimulus payments, according to the Bureau of Economic Analysis today (purple line in the chart below).

…..that stimulus-miracle spike is getting unwound step by step, and it looks like an uneven regression toward the mean:

Consumer Spending Shifts from Goods to Services, Inflation Crushes Incomes, But “Real” Spending Hits Record | Wolf Street