Explaining the ‘vibecession’
Explaining the ‘vibecession’
- August 14, 2026
- In her first essay for Good Authority, UC Irvine political scientist Erin Lockwood explains why consumer sentiment is low, despite measures that show the U.S. economy is thriving
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“One of the most interesting puzzles in political economy right now is the disconnect between consumer sentiment data and price levels. This is the “vibecession” outlook we’ve been seeing in the news. Despite low unemployment and strong growth in consumer spending and business investment, the University of Michigan’s consumer sentiment index remains 10% lower than a year ago.
In fact, persistent negative sentiment has proven remarkably enduring, despite the U.S.economic recovery from the covid years and surprising resilience to the past year and a half of self-inflicted price shocks from tariffs and the war on Iran. Historically, consumer sentiment has tracked standard measures of economic health, but this is no longer the case. So what’s happening? Here are five possible explanations of the vibecession.”
Continue reading online at Good Authority.
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