Almost Half of US Households Exhaust Their Salaries

So, the economy is looking up since 2008?

I just saw this reported on the CBS evening news. It wasn't to be found in their search engine, but I did find the AP story reported in the Denver Post. This isn't good news my friends, but it seems to me to be entirely realistic.

The Federal Reserve has declared economic growth "solid." But several new reports show most Americans are treading along a dangerous financial tightrope, where one slip could be devastating. Nearly half of U.S. households — 47 percent — say they spend all of their income, go into debt or dip into savings to meet their annual expenses, according to an analysis of Fed survey data released Thursday by the Pew Charitable Trusts. "They could not withstand a serious financial emergency," said Diana Elliott, a Pew research manager who co-wrote the analysis. "That really is the contrast to the macroeconomic story" of a recovering economy. "Macro indicators tell us a lot, but they don't tell us what is specifically happening within families," she said. If a typical middle-class household had to weather a period of joblessness without any income, they would exhaust their available savings within 21 days, the analysis found. If that same family also cashed in all their retirement investments to get by, they would burn through those assets within four months.

That seems to be closer to the truth concerning the real state of our economic situation in the U.S. Don't worry though, some folks seem to be doing OK.

"There is something to be said about thinking who the economy is improving for," said Kasey Wiedrich, director of applied research at the nonprofit. Based on updated tax data released this week, the evidence is that the economy has improved for the 1 percent. Including capital gains, they earned nearly 19 percent of all income in 2013, according to Emmanuel Saez, an economist at University of California at Berkeley. To be in the top 1 percent, a family had to earn at least $391,960. That's more than seven times the annual median household income of $54,417, according to Sentier Research.

Yep, things are sure looking good for our economy, just don't look at all the other things on the economic horizon and add them in the mix. The future's so bright, we need to wear shades.

Full Story Here

Most people I know are just barely treading water, one medical or legal problem away from total disaster really. Living check to check with nothing left over after the basic bills are paid.

a reply to: TKDRL

Same story I've been hearing from family and friends lately. Seems like everyone I know is hanging by a thread. At least I know that a lot of people are all in the same boat. It's no wonder the urber-rich are taking precautions.

But it's like my heartless old boss told me before, "You ought to be used to it by now." I guess I know why that bastard was always blaring Rush Limbaugh in his truck when he came around to the work place, he must think he's part of the 1%.

Well, I think it time for his type to get used to it when the homeless masses come bearing pitchforks.

This is me. I am living paycheck to paycheck because I barely make enough to cover rent and bills. Because I am self-employed sometimes I have to shift around bills and use one credit card to pay another bill. It's awful.

I have been trying to get back into the 'real world' and applying to various jobs but I haven't heard a peep. Because I'm hearing impaired I am limited to what I can do.

It could be worse, though. I could be homeless.

a reply to: MichiganSwampBuck

I have been talking about this for months......nearly half the workers in this country make poverty wages.

They live hand to mouth. They are absolutely broke the day before payday.

The top are the only ones recovering.

The bottom hasn't seen a pay raise in years, inflation alone is crushing them.

The top and upper middle class workers get a cost of living raise to adjust for inflation.

The bottom gets a quarter every 6 months if they are lucky...this doesn't even cover inflation.

Let's see what happens now that IBM is shedding their older employees. A lot of these workers are over 50 years old and have worked for the company 20+ years and are being laid off this week. Being dumped into a pool of the unemployed it's going to be very hard for them to compete with the thousands of other people looking for tech jobs, especially at their age. Pretty soon they will be living hand to mouth, too.

My brother was laid off from IBM in October. He is actively looking for work still.

I think some of this is still carry over from an over-priced housing market. Mortgages and rents are far too over-valued..even just "decent" housing is exorbitantly priced and takes a huge chunk of any family's budget.

That and food prices are absurd.

originally posted by: kosmicjack
I think some of this is still carry over from an over-priced housing market. Mortgages and rents are far too over-valued..even just "decent" housing is exorbitantly priced and take a huge chunk if any family's budget.



That and food prices are absurd.

Rent is outrageous right now. I remember ten years ago that apartment communities would give concessions such as reduction in rent, free carpet cleaning, free covered parking for a year, etc.. in order to get you to renew your lease. Now, because leasing is at an all-time high, rents are increasing up to $100 per renewal. It's crazy and WRONG.

I went to the store to buy some ground beef and it's now almost $7.00. It's a good way to stop eating meat.

At least we have Fox "News" telling us how evil a raise in the minimum wage would be. Now, could you please stop making posts like this? You're hurting the 1%'ers feelings. It's hard to loot a country when you feel self-conscious about it.

a reply to: Blackmarketeer

OK, I'll stop. Rich folks are people too, sort of.

a reply to: MichiganSwampBuck

2 careers, local guardsmen, and a civilian corporate career. I am 23. I am in debt. I am turning to alternative living in order to be able to save and get out of debt.

I will never be able to afford a 2,000 sq ft house, nor (after this transition) will I feel that I will ever want one.

Our age has learned that we are broke as crud, and we will never be on top unless you were born there.
I will lead a simple life while continuing to work my life away with no hopes of there being any sort of funding to help me when I am old.

They have turned their backs on us, left us to adapt and over come. What will they do when we no longer need their products?

I have considered moving to a different country for a better shot at life.

originally posted by: intunewithmyself
a reply to: MichiganSwampBuck

I have considered moving to a different country for a better shot at life.

Other countries citizens find themselves in similar situations. Will those countries you wish to move to accept you? Do you have critical skills that they want?

a reply to: intunewithmyself

It used to be people like my parents, who would be about the age of your grandparents, had the idea that each generation would have it a little better than the last. I don't see that happening in the least, I see the giant falling down off the bean stalk soon. I had entertained thoughts of moving to another state or even another country, but unfortunately Pteridine is right and for all practical purposes when the SHTF there will be no where else to go IMO.

I'm living on 40 acres and with Michigan's right to farm laws and the agricultural zoning of the property, I plan on farming hops and a few other things, hopefully starting this year. I never started out a farmer nor aspired to be one and it will be difficult, but people are going to want a few beers, if there is anything left of this country after the crash. It would be nice to find help, I'm sure there will be enough jobless people around to help when there is little left of our economy. It seems my only option if I can manage to pay my bills for a couple more years, if we even have that long. There are too many scenarios that could play out in a bad way, young people your age may end up forced to fight in WW3 for example. Just got to keep on moving forward the best we all can.

a reply to: MichiganSwampBuck

Still don't get this.

Personally, I work a day job, make about $85k a year, no college, only tech certs. Plus I own my business, we make luxury specialty items. Each is about $3k and I have repeat customers making multiple orders at a time. Backed up right now for 8 months.

a reply to: macman
Must be nice. Let's hope your business don't get effected by some ecobubble bursting.

a reply to: macman

Glad to hear that someone is making it besides the 1%, I mean that sincerely, perhaps there is some hope. Apparently you're doing quite well catering to the rich with your luxury items and tech skills, no so with many though and I expect to see things get worse quickly. Once the have-nots out number the haves, it may not matter that some are still making it for themselves. I see this as a snowball coming down the mountain.

It seems to me that the problems that these households are having in this 47%, are similar to what our government is having with the high deficits and never ending spending habits. We shall see what is yet to come, I really can't see things getting better without getting far worse first however.

a reply to: MichiganSwampBuck

Since the 1980s, economic gains in America went upward and did not trickle down. As fellow Michiganer says

Our young people are drowning in a sea of debt, and it all started with Reaganomics. And Reaganomics is a lot like cancer. Most people don’t know they have cancer until it reaches the later cancer stages, when it becomes much harder to treat. In the early stages, cancer starts off as inflammation. A few cells grow slowly initially. But then, the cells begin to rapidly multiply, and the cancer begins to pick up steam. As it picks up steam, the cancer takes on more and more of the body’s resources, and starts stealing the body’s energy and tissues. Pretty soon, the cancer completely overwhelms the body, and, without treatment, the person dies.

source

then came the 1980’s and Reaganomics. Suddenly, all the economics talk was about “free markets”, “too much regulation”, and turning America into a libertarian paradise. That led to the unprecedented era of Reagan deregulation, which directly led to the stock market crash of 1987, which, until 2008, was the worst crash our country had seen since 1929.

And while Reagan was busy deregulating America, the predictable result was that the middle-class was becoming smaller and smaller, while the wealthy elite were getting richer and richer. 34 years of Reaganomics has gutted the middle-class, and destroyed an American economy that once worked for everyone.

The income gap in America has widened exponentially since Reagan took office and implemented the so-called “Reagan Tax Cuts.” Between 1947 and 1980, income gains were shared fairly equally between the wealthiest Americans and everyone else. But then everything changed.

What happens when the tea party goes to Washington

The rightward economic restructuring of the American economy ushered in since 1980 created more wealth for the top of the iceberg and more debt for the bottom of the iceberg. But those of us living at the bottom of the iceberg are underwater keeping the top afloat.

The right wing utopian economic lala land was no good for an America caught up in an increasingly globalized world. Well, no good for the bottom of the iceberg, which is the biggest part.

Science fiction shows us ourselves now, but set in the future
I’ve seen the future, I can’t afford it – Jim Munroe’s “Ghosts With # Jobs”
and
I couldn't get the link to work but go to tor.com and search for "The Future is Disturbing and Funny: Ghosts With # Jobs"

Roll back Reaganomics.

a reply to: desert

Yeah, I've been into politics since those Regan days. I have, ever since, referred to it as "trickle up" economics. Some people today look upon Regan as a political god, back then it seemed most just thought of him as an out of work actor who used to co-star with a chimp.

originally posted by: kosmicjack
I think some of this is still carry over from an over-priced housing market. Mortgages and rents are far too over-valued..even just "decent" housing is exorbitantly priced and takes a huge chunk of any family's budget.

That and food prices are absurd.

Housing has had a pretty good correction over the last 6 years, but mortgages are much harder to get, and with the never ending recession most likely impossible for many due to underpay and lower credit scores. This has affected the rent market with exorbitant increase in rent since there are more people who want/need to rent then there is rentals.

originally posted by: macman

Still don't get this.

Personally, I work a day job, make about $85k a year, no college, only tech certs. Plus I own my business, we make luxury specialty items. Each is about $3k and I have repeat customers making multiple orders at a time. Backed up right now for 8 months.

I think there are two sides to this coin. I make good money, have great credit so these past 6 years have been great for me even though my buying power has been reduced some with this never ending recession. All my cars have been zero interest loans, my house is 3.2 30 year fixed, and anything else is well under 8%.

The deal is I do not live payday to payday and those that do have been gobbled up by higher costs without seeing their income go up too. What was once payday to payday or a little better is now 500 plus a month on credit with no paying it off. Where I live in Washington state if you can afford a 500k house you have a lot to chose from, little competition since the average family income is 55k, so you get really good deal at a really good mortgage interest rate.

All these other families are not doing so well, higher interest, over priced lower cost housing, big demands, while income is either stagnating or going the other way.