Pundits have been talking a lot about America’s “K-shaped economy” lately, but most average people on the street have no idea what that means. Basically, it means that the wealthy are getting even wealthier while almost everyone else is getting monkey-hammered. Yesterday, I detailed 11 signs that economic conditions in the U.S. are the worst that they have been since the Great Recession, but if you have plenty of money you may feel like everything is just great right now. For those at the top of the economic pyramid, it could be argued that these are the best of times because the stock market has been soaring. But for many of those at the bottom of the economic pyramid, it literally feels like we are in the midst of a horrifying economic crisis.
At a time when the cost of living is crushing most of the population, debt levels are exploding, and mass layoffs are happening all over the nation, we continue to see “strong spending and healthy income growth among upper-income Americans”…
Experts describe the current U.S. economy as “K-shaped,” a reference to the divergent fortunes of wealthier consumers compared with people lower down the ladder. The upward-slanting stroke of the “K” represents the ongoing trend of strong spending and healthy income growth among upper-income Americans.
By contrast, the letter’s lower-slanting stroke points to the multiple financial strains facing low- and middle-income people, from stubborn inflation and prohibitively expensive homes to surging credit card debt and high health insurance costs.
The top 10 percent of all income earners have always spent more money than everyone else.
But now the proportion of consumer spending that they are accounting for has reached the highest level ever recorded…
These days, however, a large and growing share of that commercial activity is driven by upwardly mobile Americans. In the second quarter of 2025, the top 10% of income earners accounted for almost half of all spending, according to an analysis of Federal Reserve data by Zandi.
“That group has always accounted for a much larger share of spending, but that share has risen significantly over time, and now is the highest it’s ever been in the data,” he told CBS News.
If you are thriving in this very difficult economic environment, that is a good thing.
However, you should also be aware that most people are really struggling, and that is especially true for low-income Americans.
In fact, the percentage of subprime borrowers that are “at least 60 days past due on their auto loans” just shot up to the highest level we have ever seen…
More Americans than ever are falling behind on their car payments.
The share of subprime borrowers at least 60 days past due on their auto loans rose to 6.65% in October, the highest in data going back to 1994, according to Fitch Ratings.
With ongoing inflation pressures and the return of student loan bills, millions of car owners are struggling to afford their monthly payments. It’s the latest sign of weakness in the US economy as the Federal Reserve considers the path of future rate cuts.
We never even got a number this bad during the Great Recession of 2008 and 2009.
As a result, vehicle repossessions are absolutely soaring.
This is the economic reality that most of us are living in.
According to one recent survey, 55 percent of American workers are concerned that they could soon lose their jobs…
Some 55% of employed Americans say they’re concerned about losing their jobs, according to a recent Harris Poll conducted for Bloomberg News. That angst follows a drumbeat of layoff announcements by major employers, including Amazon.com Inc., Target Corp. and Starbucks Corp. Outplacement firm Challenger, Gray & Christmas Inc. calculated the most job cut announcements for any October in more than two decades.
It comes layered on top of households’ exasperation over the cost of living. A 62% majority in the Oct. 23-25 poll said the cost of their everyday items had climbed over the last month and nearly half of those people said the increases have been difficult to afford.
In previous recessions, low paid workers got laid off in very high numbers.
This time around, it is highly paid workers that are getting hit particularly hard.
Even highly successful tech companies such as Amazon are eliminating good paying jobs…
Amazon is laying off almost 700 corporate workers based in New York City as part of the company’s nearly 14,000 corporate layoffs.
The layoffs, which were first reported by Crain’s New York, were disclosed in a filing with the New York State Department of Labor. In total, 660 employees are being laid off by Amazon across nine offices in New York City.
Among them, the largest layoffs affect Amazon’s Manhattan West office and its New York Tech Hub, also based in Manhattan.
It appears that the employment market is really starting to deteriorate.
And the most recent weekly report from ADP seems to confirm this…
Recent announcements of large layoffs at a few prominent companies have raised concerns that the labor market could be weakening further, and today’s new weekly ADP employment report confirms that fear.
The ADP weekly jobless report pointed to a deterioration in US labor momentum, stating that “for the four weeks ending Oct. 25, 2025, private employers shed an average of 11,250 jobs a week, suggesting that the labor market struggled to produce jobs consistently during the second half of the month.”
Added together that is 45,000 job losses in the month (not including government workers), which would be the largest monthly drop in jobs since March 2023…
But if you have lots of cash in the bank and you are not concerned about the security of your job, you might be feeling pretty good right about now.
As Peter Atwater has aptly noted, those that are sitting at the top are “spending like there’s no tomorrow”…
Peter Atwater, president of Financial Insyghts, said that the biggest division is America is not on the left and right, it’s up and down between those at the top and bottom of the US economy. For those at the top, the economy looks good and they are ‘spending like there’s no tomorrow.’ But Atwater says Americans on the bottom are already facing recession conditions, as people struggle with affordability.
Of course the prosperity that high earners are currently experiencing is just temporary.
Anyone that thinks that this stock market bubble is sustainable is simply not being rational.
Key ratios were not even this out of whack during the most euphoric days of the Dotcom bubble.
What goes up must come down.
But for now the wealthy are living the high life while most of the rest of us really struggle to make ends meet from month to month.
Michael’s new book entitled “10 Prophetic Events That Are Coming Next” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.
About the Author: Michael Snyder’s new book entitled “10 Prophetic Events That Are Coming Next” is available in paperback and for the Kindle on Amazon.com. He has also written nine other books that are available on Amazon.com including “Chaos”, “End Times”, “7 Year Apocalypse”, “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, and “Living A Life That Really Matters”. When you purchase any of Michael’s books you help to support the work that he is doing. You can also get his articles by email as soon as he publishes them by subscribing to his Substack newsletter. Michael has published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and he always freely and happily allows others to republish those articles on their own websites. These are such troubled times, and people need hope. John 3:16 tells us about the hope that God has given us through Jesus Christ: “For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.” If you have not already done so, we strongly urge you to invite Jesus Christ to be your Lord and Savior today.