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Government Says People Better Off Now, Yet People Disagree
Today’s letter is brought to you by Sidebar!Ready to supercharge your career in 2024? Sidebar is an exclusive, highly curated leadership program designed to propel you to new professional heights. Sidebar’s approach to level-up your career is focused around small peer groups, a tech-enabled platform, and an expert-led curriculum. Members say it’s like having their own Personal Board of Directors. 93% of members say that Sidebar has made a significant difference in their career trajectory. "Providing and receiving support from others who play a similar role to you is one of the best ways to grow your capabilities and succeed." - Vice President, Roku “The facilitation has been great. I love the timer bar, the way the conversation is structured, the commitment and accountability.” - Vice President, Clip “I've been impressed by Sidebar’s technology platform. The real time agenda tracker at the top of our weekly meetings really helps the group stay on track.” - Senior Director, Microsoft Nothing propels your career trajectory like a robust peer group. Learn more at sidebar.com, and join thousands of top senior leaders from companies like Microsoft, Amazon, and Meta who have taken the first step towards accelerating their career. To investors, Treasury Secretary Janet Yellen participated in an exclusive CBS interview last night about the US economy. When asked whether she and President Biden were happy with how inflation is going right now, Yellen said the following: “We know that Americans are experiencing discomfort because some important prices are higher than they were pre-pandemic, but what I think is really important is that wages have gone up along with prices, so people are better off than they were pre-pandemic.” This seems like a difficult talking point to continue reiterating because majority of the population disagrees. Only 14% of American voters say they are better off financially under the current administration. So 86% of citizens believe they are the same or worse than when Biden took office. To Yellen’s credit, wages did rise from 2020 to 2022. Just as the price of goods and services increased with higher inflation, wages went up too. But as inflation has come down, wage growth has come crashing down too. Here is the overall unweighted wage growth since the 1990s from the Federal Reserve Bank of Atlanta: The same wage growth decline is present for hourly workers as well. The trend has not discriminated in who it is affecting. So why is this important? Wage growth is slowing and it appears that things are going to erode for many citizens. We can use real wage growth as a measurement to understand the difference between inflation and wage growth. Here we can see that Americans experienced negative real wage growth for majority of 2021 and 2022. Real wage growth had improved for 7 straight months as inflation year-over-year came down to more manageable levels. But with the re-acceleration of inflation in the January 2024 numbers, real wage growth has turned negative again. This spells disaster for the average citizen. For approximately 2 years, Americans saw inflation outpace the growth in their wages. The prices that were increased are not going to come back down, plus the current annualized inflation rate from January’s number is over 3.5%, so unless an employer is planning to give employees a 4-5% raise each year it will be unlikely that wages can keep up. Secretary Yellen, President Biden, and others want to tell a story of a strong economy that is creating more opportunity for the population. Words fall on deaf ears though if the story is not true. The countdown has begun till the election. They have less than 9 months to get things turned around or many voters will enter the ballot box and vote based on their wallets. Cut rates. Print money. Get liquidity into the system. Make voters flush with cash. If you wanted to enhance President Biden’s chances of winning in November, that would be the playbook. The Fed and Treasury claim to make decisions regardless of the political outcomes, but we will see what happens in the coming months. Hope you all have a great day. I’ll talk to everyone tomorrow. -Anthony Pompliano Reader Note: Today is a free email available to everyone. If you would like to receive these letters each morning, please subscribe to become a paying member of The Pomp Letter by clicking here. Lexy Franklin is the Founder & CEO of Sidebar, and a former Facebook employee who has tons of lessons learned from one of the greatest companies in all of Silicon Valley. In this conversation, we talk about professional development, future of work, importance of small groups for career growth, lessons from Facebook, and how Sidebar can accelerate your career. 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