The US economy in 2025 exhibits clear signs of polarization. A recent warning from Ernst & Young points out that the current situation is not a traditional economic recovery, but a deep-seated K-shaped divergence—wealth of a few expands while the majority's income stagnates.

Data best illustrates the issue. The unemployment rate has risen to 4.6%, and the consumer confidence index has declined nearly 30% year-over-year. Even more indicative of the wealth gap are spending data: the top third of high-income earners increased their consumption expenditure by 4%, while the bottom third of low-income earners spent less than 1%.

Interestingly, this polarization is changing the retail landscape. Foot traffic at Walmart and dollar stores has surged, with 3 million new customers at dollar stores, 60% of whom come from households earning over $100,000 annually. In other words, even high-income groups are starting to tighten their belts, which is a true reflection of economic pressure.

What is more concerning is the risk in 2026. The impact of tariff policy implementation has not yet fully manifested, and cost pass-through is inevitable, with retailers already planning to raise prices. The Oxford Economics predicts that the K-shaped divergence will continue, and no one can give a definitive answer on how long this "lame" economic train can keep running. When wealth is concentrated in the hands of a few and becomes the main support of GDP, any contraction in this consumer demand will expose the economy's fragility.