Stock market gains spur consumer spending independent of jobs and wages

Evidence

For many Americans, the leading stock market indices act as a kind of barometer for the economy as a whole. Gains in the market generate surges in consumer spending even where more tangible indicators of economic vitality,such as job growth or wage levels,lag behind. — Greta R. Krippner, The Financialization of the American…, 8

Categorization

• XREF: Connects to the wealth effect literature in macroeconomics and to later work on the Fed’s ‘wealth effect’ reasoning in monetary policy. — connects to: Individual consumption effects cannot be isolated from production-side forces; Financial asset prices reflect speculative circulation, not underlying real value — Max Haiven, Cultures of Financialization, 80

Broader Connections

• Individual consumption effects cannot be isolated from production-side forces #contradicts (0.80)
• Financial asset prices reflect speculative circulation, not underlying real value #complicates (0.75) — Max Haiven, Cultures of Financialization, 80