The First Section: The Numbers
U.S. jobless claims ticked down even more last week to 197,000. This was below the revised 198,000 reported the previous week.
1,720,000 are still claiming unemployment benefits.
It’s still a pretty good jobs market; no reason for the Fed to not continue raising rates.
The S&P Global Flash U.S. Composite Purchasing Managers Index – a survey of service companies and manufacturers – rose to 58.4. Frequent readers will know that anything over 50 indicates expansion.
Last month it was 56.
Price increases continue to be problematic, but per the Chief Economist at S&P:
U.S. business continues to boom with output growing at the fastest rate for over five years in September.
Hmm. Not seeing that in the news.
Finally, the U. of Michigan Consumer Confidence Survey.
Yeah, it’s low. 48.1, down from 51.7 last month and 55.1 a year ago.
What are the drivers? Everything.
Future personal finances
Consumer prices
Gas prices
Maybe I should have mentioned this part first. Moving on…
Headline: U.S. Incomes Hit High as Poverty Falls
For real. Median household inflation-adjusted income increased 2.6% in 2025 to $87,460. Nice.
Women’s earnings grew faster than men’s. Women now earn 84% as much as their male counterparts, up from 81%.
Up is good. That’ll keep going up as couples have more pets, er, fur babies, and fewer kids.
All races experienced income growth, and…
The poverty rate fell from 10.7% to 10.2%.
That still leaves 34,500,000 people living below the poverty line, which is down from 36,000,000.
The poverty threshold was $32,970, and the 10.2% rate is one of the lowest levels ever recorded.
The child poverty rate fell to 13.4%.
That means that 1 in 7 children live in households officially classified as poor. Support those charities, please.
2025 was a year of improving real purchasing power – incomes grew faster than inflation.
But it tended to be along the K Economy we keep talking about. Folks with higher incomes had a higher percentage income increase than folks on the lower end.
There was still an increase in real income, just not as much.
The 10-Year Treasury hits 5.16%
Kiplinger reports that one of the reasons behind the run-up in Treasury yields is a lack of foreign buyers.
More appropriately, competing investments.
Historically, foreign banks and investors typically purchased one-third of newly issued Treasury debt. 33%. That has dropped.
They account for just 3% of purchases.
A competing product is corporate bonds issued by tech giants financing data centers; those bonds can have better yields.
Additionally, Japanese investors have turned to their domestic government bonds, whose yields have also gotten more appealing.
The YOLO/FOMO Economy
Many economists have called this economy the K economy.
That’s when one person tells you the economy is doing well and another person tells you it's not; they may both be right. That's the essence of the K-shaped economy—a wealthier/upper income America is riding the upper arm of the K, while another is stuck on the lower arm.
The Boomers are generally attributed to the upper arm.
I have a corollary to that: the YOLO economy. As in, You Only Live Once. Or FOMO. Fear Of Missing Out.
The spending is still there – see Retail Sales results in previous Reports, and just try to buy a ticket on StubHub or any other secondary market site and it won’t be near the face value of the original ticket. Like the Dodgers. Or USC vs. Oregon.
And social media is all about the experience.
Exhibit 1 was the Taylor Swift Eras Tour in 2025. Then World Cup tickets were Exhibit 2 this year. And we’re starting to see some of the prices for the 2028 Olympics.
If you are spending on experiences, Starbucks, DoorDash or tattoos, you won’t be saving to buy a house, or pretty much any other big-ticket item. But you will spend to take that once-in-a-lifetime experience to Thailand, where you can get a sleeve done super cheap! YOLO!!!!
Or use your Amex Platinum points.
I saw a posting on LinkedIn, lamenting the cost of going to a movie at an IMAX theatre and how the costs were so clearly out of hand, with the ticket costing $24.90. So I did an exercise.
A movie ticket in Los Angeles in 1984 was $5; that’s not research, that’s memory. IMAX has a premium of 25% to 100% over a regular movie ticket, so let's call it 50%. So, if IMAX was around in 1984 (which it was, but very limited), it would cost $7.50. Adjusting for annual inflation of 2.82%, or a cumulative effect of 221.38%, that brings the ticket price to $24.10. Not that far off, so is there really something to complain about?
In 1984, the Westwood Village Theatre held about 1500 and it was always a challenge to look between the heads in front of you. You now have stadium seating, reclining chairs, and you don't get in line 3 hours before the movie starts. You can buy your ticket a week ahead and pick your seat. That was, after all, the reason you got in line early. And I still remember when they introduced THX.
And you can choose not to see the movie in IMAX.
The problem is, if you are of a certain age like me, you still think $5 is worth $5 when, in fact, it's now $20. That's Boomer Syndrome. My wife and I don’t do IMAX, we bring in M&M peanuts, split a small popcorn and have water. Because we're Boomers. Get off my lawn!!
My son gets married this weekend and so I may, or may not, have a Report ready for you on Monday. Regardless, the weather forecast for So Cal is awesome for this weekend.
Q4 starts this week, so unless you have a wedding to be at, you should be assessing your progress toward your goals.
As my millennial friends say, “Keep swimming!”
