A Crisis of Confidence: This Has Happened Before

Alex Johnson (0:00)

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Hello, and welcome back to the Fintech Takes podcast. I have something a little different for you today, a audio book of a Fintech Takes essay. Now, this is something that I've done from time to time in the past. Essentially, the plan is to just read an essay that I wrote earlier this year to you, so that you can listen to it, absorb it, think about it. I do this from time to time because there are essays that I write that I put a lot of time and effort into and that I'm really proud of, and I want to get the most possible sort of exposure in the industry to. The challenge, of course, is that a lot of those essays are really, really long, and I feel bad about that because I know not everyone has time to read very lengthy pieces of written content throughout the day. A lot of times, it's actually easier to listen to these things while walking the dog, working out, washing the dishes, on your way home from your work. So that's the plan. Today's essay that I'm going to be reciting to you all is called A Crisis of Confidence. It's an essay that I published back in May of this year, and it came out of a conversation that I had with folks in the financial health space, where we were talking about the unusual situation that we find ourselves in in 2026, where even though the economy is relatively strong, and even though all the macro signals would suggest that everyone is doing fairly well, there's this pervasive sense of pessimism that exists among consumers that I think you and I all feel, and that is really at odds with the data. And because of this gap between the economic data versus consumer sentiment, what Kyla Scanlon has called a vibe session, I think you tend to see these very interesting structural responses from consumers. And so I wanted to sort of chart out and figure out, well, what are all of these structural responses? And most importantly, is there a moment in time in American history where we've seen this before? And if there is, well, what might that moment tell us about what's happening now? And how might some of the differences between then and now illustrate some of the challenges that we have moving forward? So I did a little research into this. I found a decade in American history that I think almost perfectly parallels the very strange vibe session era that we're in right now and tells us a lot about what our customers are going through. So today's episode is a recitation of an essay that I wrote on this topic called The Crisis of Confidence. If you hang on until the very end, after I'm done reciting the essay, I will come back on and sort of share some updated thoughts on what's changed since May of 2026 and how I'm feeling about this topic since then. And overall, it should be a good hour long conversation just among me and myself and I. I hope that you enjoy it. So without further ado, here is A Crisis of Confidence.

This is Fintech Takes, the podcast keeping you in the loop on all the latest fintech trends, news and ideas. I'm Alex Johnson, creator of the Fintech Takes newsletter, your host and self-confessed fintech nerd. Let's go.

A Crisis of Confidence. In a nation that was proud of hard work, strong families, close-knit communities, and our faith in God, too many of us now tend to worship self-indulgence and consumption. Human identity is no longer defined by what one does, but by what one owns. But we've discovered that owning things and consuming things does not satisfy our longing for meaning. We've learned that piling up material goods cannot fill the emptiness of lives which have no confidence or purpose. The symptoms of this crisis of the American spirit are all around us. For the first time in the history of our country, a majority of our people believe that the next five years will be worse than the past five years.

Those words were written in 1979 and spoken by President Jimmy Carter as part of his famous Crisis of Confidence speech. However, if the ideas expressed in that quote sound distinctly 2026 to you, you're not alone. Financial nihilism is a topic that I've been obsessing over for the last couple of years. Lately, I've been wondering if the conditions that are creating that nihilism, the economic, political, and social uncertainty that we all feel, combined with the real structural pressures squeezing our livelihoods and financial welfare, have any good historical parallels? Have US consumers experienced these types of conditions before? And if so, did they exhibit similar financially nihilistic tendencies to what we are seeing today?