(The Epoch Times)—Americans expect inflation to worsen in the coming months and have lower expectations regarding personal finances, indicating a dismal national economic outlook.
“Year-ahead inflation expectations rose from 3.2 percent last month to 4.2 percent this month, the highest reading since May 2023,” an Oct. 27 survey report by the University of Michigan states. Coinciding with the surge in inflation, consumer sentiment fell to 6 percent in October after two consecutive months of little change.
“While consumers recognize that inflation has slowed down from its peak last summer, they cannot ignore that their budgets remain stretched and their purchasing power reduced,” chief economist Joanne Hsu, director of the surveys, said in an Oct. 27 statement from the university’s Institute for Social Research.
“Given the high-frequency and widespread nature of food and gas purchases across American families, it is no surprise that concerns over the prices of these goods loom particularly large in the minds of consumers. Even so, strength in incomes continues to support aggregate spending for the time being.”
About 47 percent of consumers reported that high prices—8 percentage points higher than in September—were eroding their living standards.
When talking about inflation, consumers “spontaneously pointed” to the prices of gas and groceries. “Spontaneous mentions of high prices for larger purchases like durables and vehicles have been relatively flat this month,” the Institute for Social Research statement reads.
Regarding personal finances, lower-income consumers saw little change, while middle- and higher-income consumers have seen declines since August, which is partly because of the “recent weakness in stock markets,” according to the statement.
One-year expectations of consumers’ personal finances dropped by 8 percent from last month, while year-ahead expectations of business conditions plunged by 16 percent, the survey report shows.
“The drumbeat of other negative headlines—war in the Middle East, the just-resolved leadership crisis in the House of Representatives, daily developments with Trump’s legal troubles, among others—has produced its own drag [on consumer sentiment],” Ms. Hsu said.
Consumer expectations on long-run inflation edged up from 2.8 percent last month to 3.0 percent this month, staying within the narrow 2.9 percent to 3.1 percent range for 25 of the past 27 months. This is also well above the 2.2 percent to 2.6 percent range seen in the two years prior to the COVID-19 pandemic.
Inflation and Interest Rates
Consumer worries about inflation come as the Federal Reserve has been attempting to bring inflation down by raising interest rates. The action has resulted in the U.S. economy facing an environment of rising prices and elevated interest rates, putting pressure on household budgets and business finances.
Since March 2022, the central bank has raised its benchmark interest rate by 500 basis points to a range of 5.25 percent to 5.5 percent, which is the highest level in 22 years.
During the last Fed meeting, the central bank didn’t raise the interest rates. At the time, Federal Reserve Chair Jerome Powell suggested that there may be no rate hike in the upcoming meeting scheduled for Oct. 31 and Nov. 1.
However, the Fed’s “Summary of Economic Projections” from September left the door open for one more potential rate hike.
Speaking at a business conference on Oct. 2, Federal Reserve Gov. Michelle Bowman said that interest rates may need to move higher to address inflation.
“Inflation continues to be too high, and I expect it will likely be appropriate for the Committee to raise rates further and hold them at a restrictive level for some time to return inflation to our 2 percent goal in a timely way,” she said.
Ms. Bowman warned that there’s a “continued risk that high energy prices could reverse some of the progress we have seen on inflation in recent months.”
Mr. Powell admitted that inflation remains high and that economic growth may need to ease to bring it down to the Fed’s target rate of 2 percent. Annual inflation in September was 3.7 percent.
However, the economy grew by 4.9 percent in the third quarter of this year, accelerating from the 2.1 percent growth in the previous quarter, which can put pressure on the Fed to raise rates.
Struggling Under Inflation
The elevated rate of inflation has made life tough for Americans. A Gallup survey published in May showed that 61 percent of U.S. citizens were facing financial hardship in their households because of elevated prices—the highest since 2021, when Gallup began to track the data.
“A relatively steady 15 percent of U.S. adults say the hardship created by inflation is ‘severe’ and affects their ability to maintain their current standard of living,” according to a May 18 Gallup survey report. “[This is] statistically similar to the prior two readings and has not varied greatly since the first reading.”
Lower-income Americans faced greater difficulty from inflation than people in the higher income brackets.
An April Gallup poll found that inflation was the top concern for Americans. While 35 percent said that inflation was the biggest issue; 11 percent cited the cost of owning or renting a home; and 9 percent saw “too much debt” as a major problem.
In a recent interview with CNBC, former Walmart CEO Bill Simon said that consumers had an “incredible 10-, 12-year run” when “markets were buoyant, interest rates were low, [and] money was available.”
But now, factors such as inflation and high interest rates are working to sap consumers’ propensity to spend, he said. “That sort of pileup wears on the consumer and makes them wary. … For the first time in a long time, there’s a reason for the consumer to pause.”
Bypass Big Tech Censors
Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.