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The personal satisfaction of the average American has taken a tumble along with the economy in the initial impact of the coronavirus pandemic, causing the biggest drop in more than 10 years.
In fact, according to the American Institute of CPAs' Q1 2020 Personal Financial Satisfaction index (PFSi), a quarterly economic gauge using data from the Bureau of Labor Statistics and Federal Reserve Board of Governors to measure the personal financial standing of a typical American, it's the biggest drop since the Great Recession—Q4 of 2009.
The Q1 PFSi fell a whopping 20 points, chiefly because of the market's plummet (the Market index is down 21 percent, or 20.9 points), but also because of the Inflation index, up 33.8 percent or 10.7 points. Logically enough, a rise in inflation causes an increase in financial pain. And according to the report, since inflation is "the most volatile factor contributing to the PFSi," the current absolute levels are so low that "small changes result in large percent gains."
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Marlene Satter
Marlene Y. Satter has worked in and written about the financial industry for decades.
