This article outlines the key points discussed in the Chart of the Week from Morning Brief. Recent consumer sentiment data has been pessimistic due to uncertainty over President Trump's tariff policies, causing confidence in the economy to hit a four-year low in March. While the consumer outlook has worsened, it has not yet led to a widespread expectation of a recession on Wall Street.

The decline in consumer confidence in March was seen across all income groups except households earning over $125,000 annually. This trend is reflected in various economic indicators, especially the personal savings rate. The behavior of high-income consumers, who make up a significant portion of US consumer spending, is crucial in determining the economic narrative.

High-income earners are currently maintaining spending, acting as a buffer against a weakening economy and potential recession. However, if political uncertainty continues to impact consumer sentiment and stock prices, the risk of a recession may increase as these consumers cut back on spending in response to declining asset prices. This scenario could significantly impact the economy, with a 20% drop in equity prices potentially leading high-income earners to reduce spending and adversely affect economic activity.