Why We Feel Broke Even When We’re Not: The Great Consumer Sentiment Mystery

The economy says we’re thriving. We say we’re struggling. Who’s right? Everyone — and no one.

Let’s crack a strange case. Since 2017, the RBI’s Consumer Confidence Index has hovered below 100 — a number that, in economist-speak, means: “meh, not feeling it.” For nearly eight years, India’s urban consumers have reported persistent pessimism.

And yet?
The economy didn’t tank.
Incomes rose.
Jobs came back.
Growth ticked on.

So… why does everyone still feel broke?

Turns out, India’s not alone in this emotional-economic contradiction. Across the globe, people are spending more, earning more — and still sighing at the checkout counter. Let’s unpack why.

Spending Is Up. Vibes Are Down.

A 2024 U.S. Fed study revealed a fascinating disconnect. Consumers reported feeling worse than during COVID or the 2008 crash — yet they were spending more than ever. Not just throwing money around — actually buying more.

Feeling confused?

So was I…. Here’s an analogy to help you understand the scenario:

The Leaky Bucket Economy

In 2019, your income was a steady tap, slowly filling your bucket. Life was manageable.

Now it’s 2024. The tap’s running faster — promotions, increments, freelance gigs — more water’s flowing in.

But guess what?

Your bucket has sprung more leaks.

Groceries. Fuel. Rent. EMIs. Fees. Everything’s poking holes. You’re working harder just to stay afloat. More is coming in — but even more is leaking out. You’re not sinking… but you’re never full.

From the outside, you’re thriving:
Swiping.
Shopping.
Upward trajectory.

But inside? You’re drained. The joy-to-effort ratio feels broken.

It’s like the Assistant Manager works hard to get promoted into manager in 5 years, just to realize that his stardard of living remains the same as 5 years back!

Add to the mix Inhumane attitude of the Corporates towards their employees, such as:

Source: ET

The K-Shaped Twist: One Economy, Two Stories

Now here’s the kicker.

If the top 10% (the “Bhavish Aggarwal”s of India) are splurging while the rest are just surviving, the macro numbers will glow — even while half the country sighs.

That’s the K-shaped Economy: the rich rise, the rest remain stuck or slide.

Fun fact? The last time RBI’s Consumer Confidence Index was upbeat? Pre-demonetisation. Since then, it’s been in a slump. Coincidence? Maybe. But the mood never quite bounced back.

The Finopsis Take

This isn’t a cash crunch.
It’s an emotional deficit.
We earn more — but we bleed for it.
The bills get cleared, but the joy gets taxed.

The data sees a recovery.
We feel a grind.

That’s the real economy — and that’s the story the spreadsheets miss.

Leave a Comment

Your email address will not be published. Required fields are marked *