Historic artificial intelligence investments and a widening wealth gap collide with persistent cost pressures in the United States, driving sharp stock market gains for the wealthiest households while everyday shoppers face steep price hikes on basic goods and home ownership.
The United States finds itself in the middle of a historic and costly technological revolution. Spending on artificial intelligence infrastructure is currently fueling capital outlays projected to surpass the historical telecom boom along with major national infrastructure initiatives like highway and rail network construction.
This transformation has spurred immense stock market gains, boosting household wealth across the economy and keeping consumer spending resilient. Yet those gains remain heavily concentrated among the wealthiest citizens, creating a stark economic dichotomy as midterm elections approach.
Top 1 Percent Captures Most National Wealth Gains
While the broader economy expands, the benefits are far from evenly distributed. Rapid stock market gains over recent years have accumulated fastest at the very top of the financial ladder.
Federal Reserve data shows that between the end of the administration of former President Joe Biden and the second quarter of 2026—midway through the final term of Donald Trump—only the top 1% gained a bigger slice of the national wealth pie. For the 99th percentile and downward, the overall share of wealth grew smaller.
Even so, the lower 99% of households have not been entirely excluded from the upward movement. Between the close of the Biden presidency and mid-2026, total household wealth expanded by 16.5%, translating to an absolute increase of approximately $26 trillion.
Less than half a trillion dollars of that total reached the least-wealthy half of households, though that still translated to an approximate 10% gain for that group. Economists continue to debate whether the nation can grow sustainably if wealth divisions continue to get more skewed.
Consumer Spending Resilience Against Inflationary Pressures
Despite sour public sentiment, consumer spending continues to surge. Money flowing out of U.S. households to purchase goods and services is climbing at a pace faster than it did before the pandemic.
Analysts searching for a “K-shaped” spending split—with affluent households coasting while lower-income consumers struggle—have found mixed evidence. Research from major banks and the Richmond Federal Reserve indicates that spending at the lower end of the wealth distribution is holding up, while studies from the New York Fed show little sign of an immediate credit crisis among less affluent borrowers.
However, real spending adjusted for inflation is growing at roughly pre-pandemic rates. The widening gap between nominal and real spending highlights ground lost to rising prices.
This persistent financial grind helps explain why public opinion has turned against Trump and Republican congressional candidates just weeks before midterm elections. Households are forced to spend more merely to maintain their footing.
Persistent Price Shocks in Housing and Everyday Goods
During the 2024 presidential campaign, Trump pledged not only to tame inflation but to lower the overall price level from the start of his new term. Over the past 20 months, however, inflation has rebounded from his earliest months in office.
Price pressures have persisted as the shock of import tariffs, energy costs tied to the Iran war, and the AI boom course through the economy. While hourly wage growth and the Consumer Price Index climb at similar paces, marquee items for shoppers—such as gasoline and ground beef—have soared.
Big-ticket items like homes present an even greater hurdle for families trying to build long-term wealth. The pandemic-era shock to housing has persisted, and so far things have not gotten better under Trump as rising bond yields push home mortgage rates up by more than a full percentage point over the past year.