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In the United States, 73 million people receive social security benefits, see the first chart below.
Social security spending and Medicare and healthcare spending make up half of the total $6.75 trillion in federal spending, see the second chart below.
In addition, for the fiscal year 2024, the government spent more money on debt servicing costs than on Medicare and on defense, see again the second chart.
Note: Social Security beneficiaries who are entitled to a primary and a secondary benefit (dual entitlement) are counted only once. SSI counts include recipients of federal SSI, federally administered state supplementation, or both. Source: Social Security Administration, Master Beneficiary Record and Supplemental Security Record, Apollo Chief Economist 
Source: US Treasury, Bloomberg, Apollo Chief Economist See important disclaimers at the bottom of the page.
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Only 24% of homes purchased at the moment are bought by first-time homebuyers. This is the lowest level on record, see chart below.
Source: National Association of Realtors, Apollo Chief Economist See important disclaimers at the bottom of the page.
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Sometimes, FOMC members think the risk to their inflation forecast is to the upside, and sometimes, they think the risk to their inflation forecast is to the downside, see the first chart below.
This is in sharp contrast to their views on the risks to the unemployment rate.
The number of FOMC members who think the risk to their forecast for the unemployment rate is weighted to the upside is always much higher than the number of FOMC members who think the risk to their unemployment rate forecast is to the downside, see the second chart.
In other words, the Fed has a very asymmetric view on its dual mandate, putting much more weight on low unemployment than on getting inflation to stay at 2%.
Note: No survey was conducted in March 2020. Source: Federal Reserve, Bloomberg, Apollo Chief Economist 
Note: No survey was conducted in March 2020. Source: Federal Reserve, Apollo Chief Economist See important disclaimers at the bottom of the page.
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The Consumer Price Index is 22% higher than in January 2020, see chart below.
This means that the prices of all goods and services that consumers spend money on are up, on average, 22%.
For example, since January 2020, the price of cereal is 30% higher, household electricity is 32% higher, and car insurance is 52% higher.
The bottom line is that the Fed’s preferred measure of inflation, namely year-over-year inflation, may be back near 2%, but the living costs for households are still dramatically higher than four years ago.
Source: Bureau of Labor Statistics, Bloomberg, Apollo Chief Economist See important disclaimers at the bottom of the page.
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The amount of dry powder in global private equity has started to decline from the peak in 2023, see chart below.
Note: Data as of November 2024. Source: Preqin, Apollo Chief Economist See important disclaimers at the bottom of the page.
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Gas prices at the pump continue to decline, which is another tailwind to consumer spending, see chart below. The decline in oil prices is driven by significant supply and production in the US and lower growth in China.
Source: AMA, Bloomberg, Apollo Chief Economist See important disclaimers at the bottom of the page.
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Total CO2 emissions from fossil fuels and industry in China are more than double the CO2 emissions in the US, see chart below, and six times bigger than CO2 emissions in Europe.
Note: t = metric tons. Source: OurWorldinData.org, Global Carbon Budget (2024), Apollo Chief Economist See important disclaimers at the bottom of the page.
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Our latest housing outlook is available here. Higher mortgage rates are weighing on demand, but the inventory of homes for sale remains very low, and housing demand is supported by solid wage growth, high stock prices, and high cash flows to owners of fixed income, including private credit.
Source: Apollo Chief Economist See important disclaimers at the bottom of the page.
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As home prices continue to rise, more and more households are taking out HELOCs to finance consumer spending, see chart below.
In other words, homeowners are liquifying their home price gains and using the proceeds for consumption.
Combined with low jobless claims, strong wage growth, high stock prices, and solid cash flows from fixed income, including private credit, the US consumer continues to do well.
Source: New York Fed Consumer Credit Panel/Equifax, Apollo Chief Economist See important disclaimers at the bottom of the page.
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When growth is strong, corporate earnings are high. When growth is weak, corporate earnings are low. This makes it difficult to find out if companies are cheap or expensive.
One way to analyze if stocks are cheap or expensive is to remove the business cycle by taking the 10-year average of earnings, and doing so shows that stocks are very expensive at the moment.
Specifically, the cyclically adjusted price earnings ratio at 38 is near all-time highs, significantly above its long-term average at 17, see chart below.
Source: Robert J. Shiller, Apollo Chief Economist See important disclaimers at the bottom of the page.
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