The Economy is Messy-Insights from Dr. Cecilia Cuellar
The Economy Is Messy. That’s the Point.
Consumer sentiment just hit its lowest level since the 1950s — yet Americans are still spending. Inflation is picking up, and your grocery bill is getting out of hand. Economists even have a name for what’s happening: doom spending — spending freely because the future feels too uncertain to save for.
This week on The Weekly Rap, Dr. A and Jack sit down with Dr. Cecilia Cuellar, research analyst at the Hibbs Institute at UT Tyler, to decode the gap between what the data says and what people actually feel.
Three things worth your time:
Why uncertainty hasn’t changed — but the weight we give it has
What doom spending reveals about how people really process economic fear
The BRIC method: a karate-trained economist’s framework for navigating high-stakes uncertainty
Chapters
2:03 Economic Headlines and Their Impact
10:02 The Role of Uncertainty in Economic Decisions
14:21 Research at the Hibbs Institute
24:40 From Athlete to Economist: Building Resilience
36:20 The Importance of Communication in Economics
If you listened to any Kevin Hassett interview this weekend, he explains spending as a function of people "feeling" their jobs are secure. While he is correct in nominal dollars, the question interviewers should have asked was relative to inventory. More money, less items...
Before I listen, I'll call out Ambiguity Aversion? When the future is uncertain, people chose any action over inaction. (It stems from a need to have control over one's personal situation.)
I am very grateful to Dr. Abdullah Al-Bahrani and Jonathan Marx for creating such a thoughtful space to talk about economics, uncertainty, and the messy world of data we all try to make sense of.
I truly enjoyed the conversation and the opportunity to share part of the work we are doing at the Hibbs Institute.
Thank you again for the invitation and for the great work you are doing through Decode Econ.