Key facts
- US household wealth increased by 16.5% from late 2024 to mid-2026.
- The top 1% of US households saw their share of national wealth grow during this period.
- Spending by lower-income households is holding up, though real spending growth matches pre-pandemic rates.
- Inflation has persisted, with prices for gasoline and ground beef soaring.
- Home mortgage rates have increased by over one percentage point in the past year.
The United States is undergoing a significant technological transformation driven by artificial intelligence investment, which has fueled substantial stock market gains and boosted overall household wealth. However, this wealth boom is disproportionately benefiting the wealthiest 1% of households, while the majority of Americans are grappling with a persistent affordability crisis.
According to Federal Reserve data, between the end of former President Joe Biden's administration and the second quarter of 2026, the top 1% saw their share of the national wealth pie increase, while the share for the bottom 99% decreased. Despite this widening wealth gap, overall household wealth rose by 16.5%, or about $26 trillion, during the same period. The least wealthy half of households saw their wealth increase by approximately 10%, or less than half a trillion dollars.
Consumer spending has remained robust, with nominal spending rising faster than before the pandemic. While research from institutions like the Richmond Federal Reserve suggests that spending at the lower end of the income distribution is holding up, and New York Fed studies show little evidence of a credit crisis among less affluent households, real spending growth is only matching pre-pandemic rates. The gap between nominal and real spending highlights the impact of inflation, which economists identify as a significant factor contributing to negative public sentiment.
President Donald Trump had promised to tame inflation and even lower prices during his 2024 presidential campaign. However, inflation has persisted, driven by factors including import tariffs, energy costs linked to the Iran war, and the AI boom. While hourly wage growth has kept pace with the Consumer Price Index, key consumer prices like gasoline and ground beef have seen significant increases. The housing market remains a particular concern, with rising bond yields pushing home mortgage rates up by more than a full percentage point in the past year, exacerbating existing affordability issues.