Global Luxury Goods: Consumer Polarisation - Wealth Takes the Lead

The note puts the consumer polarisation thesis in global luxury goods to the test, looking across income, discretionary spending, wealth and sentiment to understand where the divide is real and where conventional wisdom overstates it. Wealth and income inequality had continued to rise in the USA from 1990 to 2019, but not because lower- and middle-income Americans became poorer in absolute terms: real incomes increased across all consumer cohorts, with higher-income households accumulating income and, especially, wealth faster. Real discretionary expenditure rose for most cohorts over the long term but remained broadly flat for the lowest quintile. In the five years post-Covid (and pre-Liberation Day) both income and wealth inequality paused, with real income growth favouring the lower four quintiles between 2019 and 2024 while the highest quintile saw a modest real decline;