Goldman Sachs Says Unhappy Americans Are Why People Feel Gloomy About the Economy

Here's a puzzle: The U.S. economy looks strong on paper, but ordinary Americans feel terrible about it. Now, investment bank Goldman Sachs thinks it has found the reason — people are simply less happy overall.

What is consumer sentiment? Consumer sentiment is a measure of how good or bad people feel about the economy and their own finances. When people feel confident, they tend to spend more money. One of the most-watched trackers is run by the University of Michigan.

The numbers are grim:

• The Michigan sentiment index hit record lows in 2026
• It fell 13% compared to a year earlier in September
• Nearly 8% of that drop happened in just one month (from August to September)

This is strange because other economic signals look good — like GDP (Gross Domestic Product, the total value of everything a country produces) growing steadily, and the stock market performing well.

So why do people feel so bad? Goldman economist Joseph Briggs says the gloom comes from a deeper unhappiness with the state of the world, not just the economy. He points to a long-running survey from the University of Chicago:

• People saying they were "very happy" dropped to 23% in 2024, down from 31% in 2016
• People saying they were "not too happy" rose to 20%, up from 13%

Briggs also found that falling trust in institutions (like government and media) is a big driver of this unhappiness. Rising prices (inflation) play a role too, but they aren't the whole story.

Why this matters: If people's mood is being shaped by non-money issues, then consumer sentiment may stay low even if the economy keeps growing. That means this once-reliable indicator might become less useful for predicting where the economy is headed.

The takeaway: Sometimes how people *feel* about money has less to do with actual dollars and more to do with how they feel about life in general.

This is an AI-generated summary. Read the original article at: https://www.cnbc.com/2026/09/19/goldman-sachs-happiness-struggling-consumer-sentiment.html