Cost of Living
Family of 4 just getting by
Back from a great week in New Orleans with the family — batteries fully recharged and ready to roll into the holidays and year-end stretch. Now we’ll see if a few catalysts line up to give the markets a late-season Santa rally.
SCOTUS’s tariff ruling is on deck, a potential rate cut is still in play, and both would help… but don’t count your chickens yet. We still need to see underlying vol cool off before this puppy can really lift into 2026.
“A household earning $130,000 today is living with the same financial fragility that defined poverty in 1965. We just refuse to call it that.”- Mike Green
What I was watching and reading this week
If you caught my note earlier this year on liquor spending, the October Liquor TX data just hit — and it’s a standout. Most of the Dallas venues I track posted meaningful gains, with many notching their best month of 2025. The consumer isn’t just showing signs of life; they’re out, active, and running tabs again.
We’ll want to watch how November and December shake out — if this momentum holds, it says a lot about how the year is closing.
On the other hand, Buy Now, Pay Later told a very different story: Cyber Monday alone saw a record $1.03B in BNPL-driven online spending.
Two sides of the same consumer — spending confidently, but increasingly on credit.
ISM Manufacturing PMI- Came in at 48.2, slipping from 48.7 last month and marking the ninth straight month of contraction. New orders weakened again, production slowed, and employment continued to shrink as factories hold off on hiring or trim staff. Respondents cited softer demand, tariff pressures, and ongoing uncertainty as key drags on activity. Overall, the print reinforces a picture of a manufacturing sector still under stress, with persistent order softness and tightening labor conditions signaling weaker momentum heading into year-end.
ADP Job Number- ADP came in soft this morning: private-sector payrolls fell by 32,000 in November, a clear miss versus expectations for modest gains. The weakness was broad, with small businesses and sectors like manufacturing and professional services shedding jobs. Wage growth is still positive — up 4.4% for job stayers and 6.3% for job changers — but not accelerating, reinforcing the picture of a cooling labor market. Overall, it’s another data point pointing toward easing labor demand, giving the Fed more flexibility, while also raising questions about underlying economic momentum heading into year-end.
The Main Course
Some of you may have seen Mike Green’s Substack note this week arguing that the “new poverty line” for a family of four in America is effectively $130,000. I agree with most of his framing. What’s wild is how many people immediately pushed back with the same tired line — “America is the most prosperous country on earth; if you want to make it, you can!”
That completely misses the point. Mike isn’t talking about ambition or work ethic — he’s talking about math. If your household isn’t earning around $130k today, you’re not keeping up with the actual cost structure of modern American life. You’re sliding further into debt, even if you’re doing everything “right.”
