Record-High 48% of Americans Predict Stock Market to Fall in 2023
A new Gallup poll of 1,011 adults in the United States conducted from January 2 to January 22 found that half of Americans say they are worse off financially than they were a year ago. This is the highest percentage of Americans saying they are worse off since the Great Recession in 2008 and 2009.
At the same time, 35 percent of Americans say they are better off and 14 percent report their finances are the same. Americans with lower incomes are more likely to say that their finances have deteriorated in the last year compared to their middle and upper-income counterparts.
The poll revealed that a record-high 48 percent of U.S. adults now predict the stock market will fall in the first half of 2023, while 18 percent expect that it will remain the same, and 31 percent say it will go up.
It can be observed that people's evaluations of their own financial situation are strongly influenced by their political outlook; currently, Republicans are more likely to say they are in a worse financial state than Democrats. When a Democrat is in the White House, Democrats tend to have a more optimistic outlook on their finances, while the opposite is true when a Republican is in office.
Given the stock market's recent poor performance, it is likely that Americans are taking this into account for their outlook for 2023, following on from the worst year since the Great Recession. Gallup conducted a survey in April 2008, prior to a major drop in the stock market and the start of a recession, which showed that 62% of Americans felt it was not a good time to invest in stocks.
In 2022, it is likely that high inflation, rising interest rates, and declining stock values had a negative impact on many Americans' financial situation, with half reporting that their situation had worsened in the past year. Americans with lower incomes, who have habitually reported the most difficulty in managing higher prices, tend to feel that their financial situation is deteriorating.
Still, Americans remain optimistic about their financial future despite these current economic challenges, with 60 percent expecting to be better off in the next year and 28 percent predicting to be worse off. This positive outlook is in line with past trends, as Americans have been optimistic about their financial future in all such Gallup surveys since 1977. Compared to January 2020's record-high 74 percent “better off” reading, the current outlook is not as optimistic.
Recent polls have revealed the financial hardships many Americans are currently enduring.
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