The liberal and anti-Trump commentariat has been tearing itself apart trying to understand why so many Americans report in polls that they think the economy is doing terribly, even as most report that they are in a better financial position than they were four years ago.

The Hill has a standard, nonhysterical account of this:

Nearly 3 in 5 Americans in a recent Harris poll said the U.S. is in a recession, despite a record number of new jobs added under Biden and the longest stretch of unemployment below 4 percent since the 1960s.

While two popular measures of consumer opinion — the University of Michigan’s index of consumer sentiment and the Conference Board’s consumer confidence index — have ticked up since mid-2022, they remain well below the level expected based on recent economic data.

This dour economic mood could spell trouble for Biden as he vies for reelection against former President Trump this November — as inflation and the economy remain top of mind for voters, a recent ABC News/Ipsos Pollfound that more Americans trust Trump on both issues than Biden.

Some more context is in order. The “record number of new jobs” is also part of the pandemic hangover. Voters are not crediting Biden for the recovery, or blaming Trump for the 2020 downturn, largely viewing the pandemic as an exogenous event unrelated to policy. That seems sound to me.

But, currently, liberals see low unemployment, rising wages, and even some rising labor-force participation, and wonder what gives. Some indicators, such as TSA’s reporting record-high air travel numbers, suggest that Americans have cash to burn and are enjoying lighting it up. Why can’t they get over inflation, which, the commentators insist, is still coming down?

Well, there might be ways of reconciling these facts with the attitudes. For instance, the New York Post reported this week on industry trends in real estate:

A recent analysis by ResiClub of the Case-Shiller National Home Price Index has unveiled a jaw-dropping surge in US home prices, soaring a lofty 47.1% since the dawn of this decade.

The boom witnessed in the early years of the 2020s has outpaced not only the growth of the 1990s and 2010s — but is now threatening to surpass the entirety of the 2000s.

Even the dizzying heights reached before the 2007 housing market meltdown are within striking distance.

If you bought a home at the rock-bottom fixed interest rates before the pandemic, and you’ve seen its nominal value nearly double in the past five years — indeed your personal financial situation is better than ever. But you might justly worry that your adult child is going to have a much harder time getting on the property ladder than you did, and you’d be right. You might also worry that the high prices are now causing the housing market to cool. Or, if its still hot, you might be in an odd position in your career where a normal raise that might have otherwise caused you to leave your current job and move to a new city just isn’t enough to offset the increased borrowing costs of a new mortgage. You’re not exactly congratulating yourself on a wise investment; you’re worried about screwing up what feels like a market distortion.

And maybe, if you lived through 2007 as a homeowner, you know how quickly and dramatically a high notional value can crash. That is, many people are sitting on assets that recently inflated in cost, and that makes them feel flush on paper. But the borrowing costs of purchasing that asset have risen dramatically. How quickly could they liquidate if they needed to? And what could they afford afterward?

That is to say, when inflation hits home in this way, it creates a great deal of notional wealth for asset holders while also stressing them out about what’s real. They suspect that the rise in food and fuel prices is permanent, and they’re justifiably not as sure about the rise in their home price and their stock portfolio.