Stock Market Rally Propels US Economy Despite Wealth Divide

* A strong stock market drives consumer spending through the "wealth effect." * The rally's benefits concentrate among high-net-worth households, exposing economic vulnerabilities. On September 27, 2025, Cryptopolitan reported that the record-breaking U.S. stock market sustains economic growth despite political uncertainty and stagnant job growth. A "wealth effect" drives this growth, as rising asset prices increase household wealth and prompt higher spending. However, the economic landscape remains precarious, as inflation exceeds the Federal Reserve’s 2% target and the market’s benefits are unevenly distributed. According to Cryptopolitan, high-net-worth households with significant stock portfolios primarily fuel consumer spending, since the top 10% of earners control 87% of the market’s total value. This disparity underscores a critical economic divide, as people with minimal or no stock investments gain little from the market surge. While soaring stock values could boost overall sentiment, data shows confidence has declined among lower-income households, a trend that reflects a widening gap in economic participation. Despite these inequalities, a notable increase in consumer spending in August 2025 prompted an upward revision of the third-quarter GDP estimate. However, concerns persist about the economy’s heavy reliance on market performance. Cryptopolitan highlighted that S&P 500 valuations are significantly above historical averages, raising alarms over the sustainability of the current rally, as a sharp market downturn could severely impact the broader economy. Meanwhile, with inflation remaining elevated, analysts predict the Federal Reserve might consider rate cuts to address economic pressures. For many consumers, especially those unable to benefit from surging financial markets, sentiment continues to lag. Cryptopolitan noted that consumer confidence metrics have reached levels historically seen during recessions, which amplifies concerns about the economy’s future trajectory. As of 12:00 UTC on September 27, 2025, Ethereum (ETH) is trading at $1,653. According to CoinMarketCap, its 24-hour trading volume has increased by 1.8%.