The U.S. economy is pulling apart: Booming for some, breaking for many.

In other words, it's looking K-shaped — one branch climbs while the other falls.

For those on the upper arm, things are going well. The top 10% of U.S. households now account for nearly half of all consumer spending, buoyed by record stock market highs. Hourly pay is now rising fastest for the highest earners, reversing a pandemic-era trend that favored the lowest-paid workers, according to the Federal Reserve Bank of Atlanta.

Meanwhile, those on the lower arm are feeling the squeeze. Grocery prices recently posted their fastest monthly increase in nearly three years, the job market is cooling and more subprime borrowers are falling behind on their car loans.

"There are now two Americas: A few, small pockets of the invulnerable amid a swelling sea of desperation," Peter Atwater, an expert in behavioral economics who popularized the K-shape idea, wrote last month.

Industries have split, too. AI investment is booming, big banks are posting strong profits and perk-laden premium credit cards are thriving — American Express now charges $895 a year for its Platinum card.

Companies that sell to both branches have noticed the divide.........

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