Nearly two months of the national average gasoline price exceeding the politically sensitive$4-per-gallonlevel have left corporate America increasingly worried about consumer health this earnings season. Kraft Heinz's CEOwarnedthat some households are "literally running out of money," while UBS analysts caution that even as theAI-linked chip and memory bubbleinflates markets to new highs, there are growing"consumer cracks beneath the surface."

TheFinancial Timesreports that U.S. consumersmay face a cash crunch this summer as Trump-era tax refund tailwindsfade and Iran-related fuel shocks squeeze household budgets.

In other words, the sugar high is ending for consumers...

Tax refunds averaging nearly $3,500 have largely helped keep spending resilient, with Walmart, Target, and Lowe's citing refund-driven support in recent earnings calls.

Some retailers warn that the boost is only temporary. Target said the tax-refund benefit will fade in the back half of the year, while Advance Auto Parts expects sales to slow as refund tailwinds disappear.

"They're literally running out of money at the end of the month," Kraft Heinz CEO Steve Cahillane said in a recent interview with the WSJ. "We're seeing negative cash flows in the lower-income brackets where they're dipping into savings."

Earlier this month, weshowed that personal spending growthfaroutpaced personal income.

... thepersonal savings rate has collapsed to a 3-year low.

PNC Bank analyst Brian LeBlanc noted, "One of the key reasons the economy has remained so resilient to higher interest rates, elevated inflation, and repeated shocks in recent years is that households have stayed in solid financial shape, allowing consumers to keep spending even as job and income growth has slowed."

"The tax refunds have been largely erased by the increase in Middle East price pressure,"said Gregory Daco, chief economist at EY Parthenon, as the FT quoted. "The longer the conflict lasts, the more we move to an adverse scenario where inflation proves more persistent and erodes consumer spending growth."

Source: ZeroHedge News