A total of 44 percent of U.S. adults say they are financially "better off" than they were a year ago, while 35 percent say they are "worse off," a new Gallup
poll has found.
Another one in five (21 percent) say their financial situation is about the same. This year-over-year financial assessment is slightly less positive than what Americans reported in 2015, when 47 percent said they were better off and 28 percent worse off, Gallup reported. But it is much rosier than the mostly negative assessments recorded between 2008 and early 2012, Gallup reported.
Since Gallup began polling on this question in the 1970s, Americans' financial assessments have fluctuated, usually along with the health of the U.S. economy. Only a handful of polls have found a majority of Americans saying they were "better off" than the previous year, including those during the dot-com boom from 1998 to 2000.
In the recent poll, while about half of U.S. men (48 percent) say they are in better financial shape than last year, women are about as likely to say they are better off (39 percent) as worse off (38 percent), Gallup said.
"And though a majority of nonwhites say their financial situation has improved (55 percent), only about four in 10 whites say they are in better financial standing compared with the previous year," the poll found.
"Americans younger than 35 remain the most positive group in their year-over-year financial assessments, with two in three saying they are better off."
Among political parties, a majority of Democrats say they are better off (55 percent) — much higher than their independent (41 percent) and Republican (36 percent) counterparts.
"Still, the 44 percent in the latest poll who say they are better off is higher than most readings in Gallup's trend, and reflects progress in certain measures of the U.S. economy such as the unemployment rate, which has declined in recent years," Gallup said.
While Gallup's poll discovered some economic optimism, Morgan Stanley
economists are clinging to their forecast of a 20 percent chance the U.S. economy will slip into recession in 2016 on evidence of contraction in the factory sector and signs of slowing among services industries.
"That assessment still feels about right," they said in a research note released on Friday.
They forecast gross domestic product was little changed in the fourth quarter and would likely grow 1.8 percent in 2016.
"Stall speed in the U.S., or even a shift to a lower channel of growth, would likely halt the Fed in its tracks — precipitating a 'one-and-done' scenario for this policy tightening cycle," the Morgan Stanley economists said.
Meanwhile, world stock market losses are approaching US$8 trillion so far this year and investors last week poured the most money into government bond funds in a year, suggesting they fear the global economy could tip into recession, Bank of America Merrill Lynch said.
The bank's U.S. economists also said on Friday that the likelihood of the world's largest economy entering a recession in the coming year has risen to 20 percent from 15 percent.
While a repeat of the 2008-09 great recession "is a big stretch" and even the one-in-five chance of a normal recession remains low, they cut their 2016 growth forecast to 2.1 percent from 2.5 percent.
Reflecting the increasingly bearish sentiment engulfing world markets, some US$7.8 trillion was wiped off the value of global stocks in the three weeks to Jan. 21, BAML said.
"We cannot rule out a recession in the next year. Accidents will happen, and we are concerned about the lack of policy ammunition to deal with a major shock," economists Ethan Harris and Emanuella Enenajor said in a note on Friday, Reuters
Editor's Note: Results for this Gallup poll are based on telephone interviews conducted Jan. 6-10, 2016, with a random sample of 1,012 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia. For results based on the total sample of national adults, the margin of sampling error is ±4 percentage points at the 95% confidence level.
(Newsmax wire services contributed to this report).
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