• Best Practices New Normal
  • Digital Dentistry
  • Data Security
  • Implants
  • Catapult Education
  • COVID-19
  • Digital Imaging
  • Laser Dentistry
  • Restorative Dentistry
  • Cosmetic Dentistry
  • Periodontics
  • Oral Care
  • Evaluating Dental Materials
  • Cement and Adhesives
  • Equipment & Supplies
  • Ergonomics
  • Products
  • Dentures
  • Infection Control
  • Orthodontics
  • Technology
  • Techniques
  • Materials
  • Emerging Research
  • Pediatric Dentistry
  • Endodontics
  • Oral-Systemic Health

Investors Bullish About Their Status, Bearish About Overall US Economy


Economic indicators show a confusing dichotomy when it comes to investors and their mindsets.

When I worked in healthcare journalism, I was an editor at a managed care publication. I was fascinated by an apparently contradictory but enduring trend: when people were surveyed about the effectiveness of “managed care” in general, they were almost overwhelmingly opposed to it. But when asked specifically about their own health plan, it didn’t matter whether the plan was Aetna or Cigna or United Healthcare—the same respondents rated their plan and their satisfaction with it very highly.

I was reminded of this when looking at the latest data from the American Institute of Certified Public Accountants (AICPA) quarterly survey of Americans’ financial satisfaction, known as the Personal Financial Satisfaction Index (PFSi). Despite a hotly contested and divisive election season afoot, the dramatic exit of Great Britain from the European Union, and uncertainty in foreign markets, here in the United States many investors are pretty satisfied with how things are going. (The “Brexit” vote occurred late in the measuring period and may have a more significant impact on consumer confidence in upcoming measurements.)

In some ways, this optimism makes sense. The stock market is in the midst of a strong cycle, home values are rising across the country, and other economic indicators point to a pending period of mild inflation—which, despite its reputation and connotation, is actually a signifier of economic growth.

The methodology behind the PFSi is a little complicated, but it boils down to this: it’s a quarterly economic indicator that weighs a variety of economic factors to calculate the financial standing of a typical American. The index is calculated as the difference between two component sub-indexes, the Personal Financial Pleasure Index and the Personal Financial Pain Index. According to the AICPA, “These sub-indexes are each composed of four equally weighted proprietary and public factors which measure the growth of assets and opportunities in the case of the Pleasure Index, and the erosion of assets and opportunities in the case of the Pain Index. Positive scores of the PFSI indicate Americans are feeling personal financial pleasure, whereas negative scores indicate they are feeling personal financial pain.”

The key is that the data, updated quarterly, provides a snapshot of the evolving mood of US investors. Don’t get hung up on the PFSi value of 17.1, but rather consider that this is a 3.4 point increase from the prior quarter and a 1.2 point increase from the same period last year. The bump may be explained, in part, by a strong job market and a jump in home equity nationally and in many states, driven by tight supply in many markets and a prolonged period of low interest rates.

The largest decline in the indices AICPA reported was in US economy optimism, which mirrors the example I outlined in the article opening. People feel good about their own economic standing, but pessimistic about the overall state of the economy.

Big swings in the indices may be in store soon; by the next quarterly report, the US election outcome will be known. No matter who is elected President in November, there will be reverberations.

Related Videos
Mastermind - Episode 37 - Thinking Outside the Box for Dental Practice Solutions
CDA 2024 Video Interview with Kuraray Noritake's Dinesh Weerasinghe and Richard Young, DDS
Mastermind – Episode 35 – Finding Strength in Our Differences
The Uptime Health Story: An Interview with Uptime Health CEO and Co-Founder Jinesh Patel
Mastermind – Episode 34: Proactive Dentistry, Diagnostics, and Early Detection
2024 Dental Products Report Spring Selection Bracket Reveal Video
Process of Care Workflow and Repairing Early Caries with Guided Enamel Remineralization
Addressing Unmet Needs in Early Childhood Oral Care - an interview with Ashlet Lerman, DDS
Mastermind Episode 33 – Charting the Course for the Future of Dentistry
Related Content
© 2024 MJH Life Sciences

All rights reserved.