Why the Economy Feels Bad When the Data Says It's Fine

Consumer confidence just hit multi-year lows. Manufacturing sentiment is in contraction. People feel pessimistic about inflation, job security, and the direction of the country.

And yet:

• Retail sales are strong.

• Industrial production ended 2025 with solid momentum.

• The unemployment rate fell in January.

• Jobless claims remain historically low.

Something doesn't add up...

This gap between how people feel about the economy and how they behave in it has been widening for over a year.

And if you're someone who built wealth through discipline and clear thinking, this disconnect probably feels familiar. Because it's the same gap that shows up in your portfolio.

The Sentiment-Behavior Gap

Economists have a name for this phenomenon: the sentiment-behavior gap. It's when survey data (what people say they'll do) diverges from hard data (what people actually do).

When asked, consumers report feeling anxious about the economy. They say they're worried about prices, their jobs, their futures. But their credit cards tell a different story. Their spending habits tell a different story. The economy keeps growing despite the pessimism.

Why the disconnect? Because humans are notoriously bad at predicting their own behavior.

We feel anxious, so we report anxiety. But our actions often tell a different story than our feelings suggest they should.

This Shows Up in Your Portfolio Too

The same dynamic plays out with investors every day.

Risk tolerance questionnaires ask how you'd feel if your portfolio dropped 20%. You check the box that says you'd stay the course. You believe it when you answer.

Then markets actually drop 15%, and you're checking your portfolio three times a day. You're calling your advisor asking if you should do something. You're losing sleep over paper losses in money you won't need for fifteen years.

Your stated risk tolerance and your actual risk behavior diverged. Just like consumer confidence and consumer spending.

What January's Market Taught Us

January 2026 was a case study in why sentiment makes a poor investment compass.

Despite weak confidence readings, the S&P 500 gained 1.5% and crossed 7,000 for the first time. But here's what made the month interesting: the leadership rotation.

• Large Cap Growth stocks (the mega-cap tech) fell 1.5%.

• Large Cap Value rose 4.6%. Small caps gained 5.4%.

• Energy stocks surged 14.4%.

• Gold hit new highs.

• The market broadened dramatically.

If you'd been chasing last year's winners, January felt like whiplash. If you'd been structured for diversification, January felt like the system working as designed.

The S&P 500 is an unmanaged index used for illustrative purposes only and cannot be invested into directly. Market leadership rotations observed in January 2026 are not indicative of future performance in any specific sector.

The Real Problem Isn't Sentiment

Here's the thing: feeling anxious about the economy isn't irrational. The world is uncertain. Geopolitical tensions are real. Inflation eroded purchasing power. Policy shifts create genuine unknowns.

The problem isn't that you feel anxious. The problem is when anxiety drives decisions. When headlines become investment strategy. When sentiment overrides structure.

The economy kept growing in January despite negative sentiment because the underlying structure remained solid.

Employment held. Spending continued. The fundamentals supported the system regardless of how people felt about it.

Structure Over Sentiment

The lesson from the sentiment-behavior gap applies directly to your portfolio: what you need isn't better prediction. What you need is better structure.

A portfolio built around how you feel in any given moment will always be reactive. A portfolio built around clear roles and systematic rules can weather your anxiety without requiring you to be anxious differently.

You don't have to stop feeling uncertain about the economy. You don't have to master your emotions or become some Zen investor who never checks their account.

You need a system that accounts for the fact that you're human. One that assigns every dollar to one of five functional engines: Reserves, Income, Growth, Inflation Protection, or Diversification. That has clear rules for when you act and when you hold steady. That doesn't require you to predict what happens next.

The same discipline that built your wealth is designed to help protect it, although no strategy can guarantee protection against loss in a declining market.

If your portfolio feels like it's at the mercy of headlines and your own anxiety, that's a structural problem, not an emotional one. And structural problems have structural solutions.

Want to explore what structure looks like for your portfolio? Let's have a conversation.

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Important Disclosure Information

Silveria Wealth Group, LLC ("SWG") is a registered investment adviser in the State of Idaho. Registration does not imply a certain level of skill or training.

The content on this blog is provided for informational and educational purposes only and should not be construed as personalized investment, legal, or tax advice. No strategy or investment style can guarantee a profit or protect against loss. Investing involves risk, including the potential loss of principal.

Past performance is not a guarantee of future results. Any indices mentioned are unmanaged and cannot be invested into directly. All information and data are from sources believed to be reliable, but their accuracy is not guaranteed.

Please consult with a qualified financial professional, CPA, or attorney regarding your specific situation before implementing any strategies discussed here.