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In an Unequal Economy, the Poor Face Inflation Now and Job Loss Later


The lease lasts only a yr, nevertheless, and Ms. Clarke is nervous about finding somewhere to live if it isn’t renewed. Even now, she is barely making ends meet: She lost her automotive keys recently and needed to spend nearly $500 replacing them, wiping out nearly all her small rainy-day fund and leaving her one crisis away from financial ruin.

“If you don’t have money, you’re on a set income, you’re continuously considering, ‘Well, possibly I shouldn’t have bought that,’” she said. “There’s no cushion. There really never was.”

More financially secure families also face headwinds, after all, which could eventually prompt them to decelerate spending. The money savings they built up in the course of the pandemic won’t last without end, and rising prices could prompt many households to tug back their spending.

And swooning stock markets could prompt richer families, who are inclined to have extra money invested, to spend lower than they otherwise would. Some economists think that the people on this demographic have mostly kept spending recently — despite their falling economic confidence — because they’re desirous to take vacations that that they had postpone earlier within the pandemic.

“Where I’m budgeting, it’s to make room for travel,” said Mr. Trevino of Los Angeles. “I feel like I’ve missed out on that slightly bit.”

Economists have speculated that richer consumers’ resilience could fade as autumn approaches they usually take stock of their funds amid a slowing economy. But for now, the truth that America’s wealthier consumers have yet to sharply pull back within the face of rising prices could also be organising a troublesome road ahead for the nation’s poorer ones.

“We actually, in a way, haven’t noticed the inflation very much,” Mr. Schoenfeld said. “This economy may be very unfair.”

Jason Karaian contributed reporting.

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