War in Ukraine. Outsized inflation. Supply chain disruptions. A lingering pandemic.
Today’s global upheavals all contribute to a sense of general economic anxiety among investors and, more broadly, the American public. The University of Michigan’s Consumer Sentiment Index — a metric that gauges how consumers view the economy and their own financial prospects — is at its lowest point since 2011.
But is the worry misplaced?
A quick drive past a gas station might suggest it isn’t, but it also wouldn’t describe the full picture. The overall, sustained health of the economy is a reminder that we must view events with proper perspective.
Consumer sentiment currently appears to be running counter to other prominent indicators. For example:
- More people are employed as the unemployment rate ticked down to 3.6% in March.
- Wage growth is at its best rate in years.
- The stock market’s returns continue to grow at the same healthy rate they have since the middle of the last century.
These factors should not blind us to what is going on in the world. Unquestionably, the war in Ukraine is a tragedy and creating global waves, from humanitarian crises to gas pump pains. Certainly, too, inflation and the supply chain are factors that lead to volatility in the markets.
But again, we come to perspective. In the past 20 years that I’ve been a wealth adviser, for example, I’ve witnessed a vast range of economic disruptions — 9/11, the tech bubble, the Iraq War, a debt downgrade, a…
