Excess Returns · Saturday, July 11, 2026
Jim Paulsen highlights that real disposable personal income, excluding subsidies, is in deep negative territory and declining year-over-year. He asserts that this trend is historically associated with recessions and predicts it will lead to weaker consumer spending and overall consumption.
“this is now widely publicized, but it's real annual growth and real disposable personal income, excluding subsidies or transfer payments made to individuals. It's deeply in a negative territory. A declining over the last year.”
“Again, you just don't see this historically outside of a recession.”
“And what I think is that's going to come through, not only in weak housing spending, but ultimately weak retail spending, uh, and consumer consumption, uh, as well.”