A leading American economist has responded to those arguing that the U.S. is in the midst of an economic boom, and warned that most consumers are falling behind thanks to elevated energy prices and inflation more generally.
Over the past few months, many within President Donald Trump’s administration have continued to describe his economy as “booming.” In early October, Trump declared that “America’s abundant energy resources are the backbone of our booming economy.”
Days earlier, White House economic adviser Kevin Hassett told CNN that the economy “is booming” when one considers “the whole picture.” During his ongoing tour of the midterm elections' battleground states, Trump has told rallygoers that a vote for Republican candidates is a vote for a “booming” economy.
And some prominent economic voices have now joined in the chorus, with JPMorgan CEO Jamie Dimon recently saying that the American economy “is kind of booming right now.”
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“It’s good times,” he told The Wall Street Journal in an interview released this week.
But Mark Zandi, chief economist at Moody’s Analytics, takes issue with the idea.
“The economy is far from booming, unless you are in the AI ecosystem, and most Americans aren’t,” he told Newsweek. “After-inflation wages are falling, and saving rates are low."
He added that U.S. consumers had so far "powered through this" but said the situation "isn't sustainable."
‘Booming’ Economy
Dimon pointed to what he described as “really low” unemployment and corporate profits that are “way up” during the October 7 interview.
According to the latest figures from the Bureau of Labor Statistics (BLS), the unemployment rate was 4.2 percent last month, up slightly from 4.1 percent in August and 4 percent when Trump returned to office in January 2025. It has remained below 5 percent—considered low by historical standards—since September 2021. And the Bureau of Economic Analysis found that corporate profits rose to a record $4.7 trillion in the second quarter of 2026.
Dimon also cited relatively low debt levels among businesses and consumers, though he acknowledged prevailing risks such as “sticky” inflation and swelling government deficits.
But Zandi said the things undergirding the “booming” narrative are not translating into gains for most households.
In September, Goldman Sachs said that artificial intelligence (AI) investment was responsible for “nearly half” of the S&P 500’s “extraordinary” earnings growth in 2026. Stock market gains and rising corporate profits have been attributed by many to AI and the associated buildout—the benefits of which Zandi said will not reach the majority of Americans.
And barring some near-term improvement, he said the economy will begin to suffer if consumers’ current financial struggles translate into a spending slowdown.
“Unless oil starts to flow more freely from the Middle East and energy prices come down, inflation and interest rates will remain elevated, and low and middle-income Americans will have no choice but to pull back on their spending” he said. “The broader economy will struggle, even if the AI build-out and stock surge continue.”
Struggling Consumers
As Zandi noted, wages are declining when taking inflation into account. The latest report from the BLS found that inflation accelerated to 3.7 percent in September from 3.4 percent the month prior, increase largely driven by fuel costs that came in hotter than analyst forecasts. Nominal hourly earnings rose 0.1 percent during the month, though consumer prices increased 0.6 percent, resulting in an effective pay cut for Americans.
And consumer confidence—as recorded by the Conference Board and the University of Michigan’s survey team—has fallen near all-time lows. Economists have blamed it on headline economic woes and a mix of high fuel prices, the Iran war and new trade tensions.
The White House maintains that such polls are flawed and that the weak consumer sentiment readings do not undercut its arguments regarding a booming U.S. economy.
"Polls over and over again harm impressions about the economy because they poll way too many Democrats,” Hassett said in September in response to the Michigan survey and “silly polls” more broadly. He went on to say that surveyed Democrats “are saying that we've got the worst economy since the Great Depression because they hate President Trump.”
However, the university’s chief pollster told Newsweek that Republican sentiment had fallen 20 percent since the beginning of the year and was "now well below its historical average” and “currently about 15 percent lower than January 2025.”
And polls continue to show bipartisan concern about affordability issues in 2026.
An AP-NORC poll, conducted September 24-28 and released in early October, found that 82 percent of Americans disapprove of Trump’s handling of the cost of living, including around six in 10 Republicans. However, two-thirds of the latter group blame rising prices more on external factors than the president.
Contact Newsweek editors on this story: Daniel Orton and Dave Siminoff.