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Bank of America survey highlights growing divide between lower income and wealthier Americans
11/6/2025, 11:07:42 PM
Economic Summary
- Zoran Mamdani's mayoral win reflects voter discontent tied to economic strain, especially among lower-income New Yorkers.
- Bank of America (BAC) anonymized account data shows a record wage-growth gap in October: +3.7% for higher-income, +2% for middle-income, and +1% for lower-income Americans, implying widening inequality and weaker purchasing power at the bottom.
- New York Fed household debt and credit data show rising delinquency rates concentrated in younger and lower-income cohorts, exacerbated by the return of student loan payments.
- CNBC's All-America economic survey finds lower-income households (<= $30,000) see prices rising faster and are far more pessimistic about wage growth than households earning over $100,000, indicating weaker consumer sentiment among the poor.
- Company-level evidence: McDonald's (MCD) reported significantly fewer visits from lower-income customers, demonstrating how income-driven demand shifts are already impacting consumer-facing firms.
Bullish
- Potential rate cuts could ease credit-card burdens for indebted consumers.
- Lower mortgage rates might help some first-time homebuyers reach ownership.
Bearish
- Stagnant wage growth for low-income workers is reducing spending power and consumer demand.
- Rising delinquencies among younger and lower-income borrowers signal growing financial stress.
- Visits from lower-income customers have cratered at companies like McDonald's, pressuring sales.
- Tariffs raise consumable goods costs disproportionately for lower-income households, worsening affordability.
Bearish tickers
MCDBAC
BAC
Bullish
Rate cuts and reduced delinquencies could ease credit stress for customers, indirectly benefiting banks like BAC.
Bearish
Its anonymized data reveals a record wage-growth gap, highlighting weaker spending among its lower-income customer base.
MCD
Bullish
A consumer recovery or targeted low-income housing/support could restore traffic and sales over time.
Bearish
Reported visits from lower-income Americans have cratered, pressuring sales and traffic trends.
People mentioned
Zoran MamdaniSteve LeismanMelissa