Goodbye American Dream: The Average U.S. Household Is $137,063 In Debt, And 38.4% Of Millennials Live With Their Parents - Michael Snyder THE ECONOMIC COLLAPSE BLOG

Goodbye American Dream: The Average U.S. Household Is $137,063 In Debt, And 38.4% Of Millennials Live With Their Parents Posted: 21 Nov 2017   Michael Snyder  THE ECONOMIC COLLAPSE BLOG Once upon a time the United States had the largest and most vibrant middle class in the history of the world, but now the middle class is steadily being eroded.  The middle class became a minority of the population for the first time ever in 2015, and just recently I wrote about a new survey that showed that 78 percent of all full-time workers in the United States live paycheck to paycheck at least part of the time.  But most people still want to live the American Dream, and so they are going into tremendous amounts of debt in a desperate attempt to live that kind of a lifestyle. According to the Federal Reserve, the average U.S. household is now $137,063 in debt, and that figure is more than double the median household income… The average American household carries $137,063 in debt, according to the Federal Reserve’s latest numbers. Yet the U.S. Census Bureau reports that the median household income was just $59,039 last year, suggesting that many Americans are living beyond their means. As a nation, we are completely and utterly drowning in debt.  U.S. consumers are now nearly 13 trillion dollars in debt overall, and many will literally spend the rest of their lives making debt payments. Over the past couple of decades, the cost of living has grown much faster than paychecks have, and this has put a tremendous amount of financial stress on hard working families.  We are told that we are in a “low inflation environment”, but that is simply not true at all… Medical expenses have grown 57% since 2003, while food and housing costs climbed 36% and 32%, respectively. Those surging basic expenses could widen the inequality gap in America, as a quarter of Americans make less than $10 per hour. Getting our healthcare costs under control is one of the biggest things that we need to do.  As I talked about the other day, some families have seen their health insurance premiums more than triple since Obamacare became law. As the cost of living continues to rise, an increasing number of young people are discovering that the only way that they can make ends meet is to live with their parents.  As a result, the percentage of adults age 26 to age 34 that live at home continued to rise even after the last recession ended… The share of older Millennials living with relatives is still rising, underscoring the lingering obstacles faced by Americans who entered the workforce during and after the Great Recession. About 20% of adults age 26 to 34 are living with parents or other family members, a figure that has climbed steadily the past decade and is up from 17% in 2012, according to an analysis of Census Bureau data by Trulia, a real estate research firm. A staggering 59.8 percent of younger Millennials (18 to 25) are now living with relatives, and overall an all-time record 38.4 percent of all Millennials are currently living with family. If so many of our young people are unable to live the American Dream, what is the future of this nation going to look like? Consumers are not the only ones that have been struggling to make ends meet.  Corporate debt has doubled since the last financial crisis, and it now stands at a record high of 8.7 trillion dollars… Fueled by low interest rates and strong investor appetite, debt of nonfinancial companies has increased at a rapid clip, to $8.7 trillion, and is equal to more than 45 percent of GDP, according to David Ader, chief macro strategist at Informa Financial Intelligence. According to the Federal Reserve, nonfinancial corporate debt outstanding has grown by $1 trillion in two years. “Everything is fine until it isn’t,” Ader said. “We don’t need to worry about that until we’re in a slowdown and profit declines.” And let us not forget government debt.  State and local governments all over the nation have piled up record amounts of debt, and the debt of the federal government has approximately doubled over the past decade. But the fact that we are now 20 trillion dollars in debt as a nation does not tell the full story.  According to Boston University professor Larry Kotlikoff, the federal government is facing a fiscal gap of 210 trillion dollars over the next 75 years… We have all these unofficial debts that are massive compared to the official debt. We’re focused just on the official debt, so we’re trying to balance the wrong books… If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $210 trillion. That’s the fiscal gap. That’s our true indebtedness. We were the wealthiest and most prosperous nation in the history of the planet, but that was never good for us. We always had to have more, and so we have been on the greatest debt binge in human history. Now a day of reckoning is fast approaching, and those that believe that we can escape the consequences of our actions are being extremely delusional. Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

Bye Bye Middle Class: The Rate Of Homeownership In The United States Has Hit The Lowest Level Ever - Michael Snyder THE ECONOMIC COLLAPSE BLOG

Bye Bye Middle Class: The Rate Of Homeownership In The United States Has Hit The Lowest Level Ever Posted: 28 Jul 2016   Michael Snyder  THE ECONOMIC COLLAPSE BLOG The percentage of Americans that own a home has fallen to the lowest level ever recorded.  During the second quarter of 2016, the non-seasonally adjusted homeownership rate fell to just 62.9 percent, which was exactly where it was at when the U.S. Census began publishing this measurement back in 1965.  This is not what a “recovery” looks like.   All throughout the Obama years, the percentage of Americans that own a home has gotten smaller and smaller and smaller.  The reason for this, of course, is that the middle class in America is dying.  Last year, we learned that middle class Americans now make up a minority of the population for the first time ever.  In order to have a high rate of homeownership, you need a thriving middle class, and you can’t have a thriving middle class without good paying middle class jobs.   This is why I write about the evisceration of the middle class so extensively, because the U.S. economy is systematically being hollowed out and most Americans don’t understand what is happening. Traditionally, owning a home has been a sign that you have arrived as a member of the middle class, but under Barack Obama the percentage of Americans that own a home has fallen every single year.  In the past, we have talked about how it had fallen to the lowest level in decades, but now it has officially fallen to the lowest level ever.  The following comes from CNBC… After rising just over a decade ago to its highest level ever, the nation’s homeownership rate fell to match its all-time low and could drop even further in the months to come. In the second quarter of this year, the rate fell to 62.9 percent, not seasonally adjusted, which is the same as it was in 1965, when the U.S. Census started tracking the metric. During the epic housing boom in the mid-2000s, the rate soared as high as 69.2 percent. That was when politicians touted the so-called “ownership society.” So why is this happening? Well, according to Wolf Richter analysts are blaming many factors… Rising home prices in an economy of stagnant wages (for the lower 80%) have pushed entry-level homes out of reach for many people. Lower priced homes in many urban areas entail a huge and costly ($ and time) commute every day. And even then, these homes may be too much of stretch for big parts of the population in expensive urban areas. First time buyers are having trouble saving for a down payment since they spend their last available dime to meet soaring rents. Millennials have been blamed. They always get blamed for everything. They saw their parents deal with the American Dream as it turned into the American Nightmare, and they learned their lesson early in life. The super-low interest rate environment hasn’t made homes more affordable because home prices, in response to super-low interest rates, have soared, and in the end, mortgage payments are higher than they were before. Higher home prices entail other costs that are higher, including taxes, brokerage fees, and insurance. Certainly all of those points are legitimate, but the truth is that what we are facing is much broader than all of that.  The middle class in the United States has been dying for decades, and in recent years the long-term trends that have been slowly eating away at the middle class like cancer have accelerated significantly.  Just consider these numbers… -In America today, nobody has a job in one out of every five families. -At this moment, 102 million working age Americans do not have a job. -According to the Social Security Administration, 51 percent of American workers currently make less than $30,000 a year. -In 1970, the middle class brought home approximately 62 percent of all income. Today, that number has plunged to just 43 percent. -The Federal Reserve says that 47 percent of Americans could not pay an unexpected $400 emergency room bill without borrowing the money from somewhere or selling something. -One recent survey discovered that 62 percent of all Americans have less than $1,000 in savings. -If you currently have no debt and you also have ten dollars in your pocket, that gives you a greater net worth than about 25 percent of all Americans. -According to Kathryn J. Edin and H. Luke Shaefer, the authors of a book entitled “$2.00 a Day: Living on Almost Nothing in America“, there are 1.5 million “ultrapoor” households in the United States that live on less than two dollars a day.  If you can believe it, that number has doubled since 1996. -Back in 2007, approximately one out of every eight children in America was on food stamps. Today, that number is one out of every five. -Things continue to get worse for the middle class as we head into the second half of 2016.  Gallup’s U.S. economic confidence index just hit the lowest level so far this year. I could keep quoting numbers at you all day, but hopefully you are getting the picture. The middle class in America just keeps getting smaller and smaller and smaller, and our politicians just keep on conducting business as usual.  They don’t seem to care that they are strangling the life out of what was once the largest and most thriving middle class in the history of the planet. And things could soon get much worse for the middle class as this new global economic crisis accelerates.  In fact, highly respected economist Peter Schiff believes that a major downturn in the U.S. is imminent… HERE IS THE REALITY: The world has caught on, and the gig is up. Under Obama’s stewardship, the U.S. national debt has gone from $10 Trillion, to what will be $20 Trillion by the time he leaves office, with nothing more than 100 MILLION Americans out of work, and 50 MILLION in poverty and on food stamps. That’s what cheap money bought for us. It was all “borrowed” cheap money too, making it infinitely worse, and the world is tired of lending. There are so many families out there that are really struggling right now, and more than two-thirds of all Americans believe that the country is on the wrong track. I would like to tell you that happy days are here again and that the best times for America are just around the corner, but unlike the politicians at the Republican and Democratic national conventions, I am not going to lie to you. Very rough times are coming, and things are going to get much harder for the middle class. Plan accordingly, and get prepared while you still can.

We Are Being Killed On Trade – Rapidly Declining Exports Signal A Death Blow For The U.S. Economy - Michael Snyder THE ECONOMIC COLLAPSE BLOG

We Are Being Killed On Trade – Rapidly Declining Exports Signal A Death Blow For The U.S. Economy

Posted: 15 Mar 2016   Michael Snyder  THE ECONOMIC COLLAPSE BLOG

Exports fell precipitously during the last two recessions, and now it is happening again.  So how in the world can anyone make the claim that the U.S. economy is in good shape?
 
On my website I have been repeatedly pointing out the parallels between the last two major economic downturns and the current crisis, and I am going to discuss another one today.  Since peaking in late 2014, U.S. exports have been steadily declining, and this is something that we never see outside of a major recession.  On the chart that I have shared below, the shaded gray bars represent the last two recessions, and you can see that exports of goods and services plunged dramatically in both instances…

And this chart does not even show the latest numbers that we have.  During the month of January, U.S. exports fell to a five and a half year low…

The U.S. trade deficit widened more than expected in January as a strong dollar and weak global demand helped to push exports to a more than 5-1/2-year low, suggesting trade will continue to weigh on economic growth in the first quarter.
The Commerce Department said on Friday the trade gap increased 2.2 percent to $45.7 billion. December’s trade deficit was revised up to $44.7 billion from the previously reported $43.4 billion. Exports have declined for four straight months.

Because our exports are falling faster than our imports, our trade deficit is blowing out once again.  Every year we buy hundreds of billions of dollars more from the rest of the world than they buy from us, and this is systematically wrecking our economy.  Over the past several decades, we have lost tens of thousands of manufacturing facilities, millions of good paying manufacturing jobs, and major exporting nations such as China have become exceedingly wealthy at our expense.

We are being absolutely killed on trade, and yet very few of our politicians ever want to talk about this.

A brand new study that was recently discussed in the New York Times is bringing some renewed attention to these problems.  It turns out that the promised “benefits” of merging the U.S. economy into the global economic system simply have not materialized…

In a recent study, three economists — David Autor at the Massachusetts Institute of Technology, David Dorn at the University of Zurich and Gordon Hanson at the University of California, San Diego — raised a profound challenge to all of us brought up to believe that economies quickly recover from trade shocks. In theory, a developed industrial country like the United States adjusts to import competition by moving workers into more advanced industries that can successfully compete in global markets.
They examined the experience of American workers after China erupted onto world markets some two decades ago. The presumed adjustment, they concluded, never happened. Or at least hasn’t happened yet. Wages remain low and unemployment high in the most affected local job markets. Nationally, there is no sign of offsetting job gains elsewhere in the economy. What’s more, they found that sagging wages in local labor markets exposed to Chinese competition reduced earnings by $213 per adult per year.

Another study conducted by some of the same researchers discovered that 2.4 million American jobs were lost between 1999 and 2011 due to rising Chinese imports.

When are we going to finally wake up?

The middle class in America is being absolutely shredded, and yet only a few of us seem to care.

Meanwhile, global trade as a whole continues to slow down at a very frightening pace.  We just learned that the China Containerized Freight Index has now dropped to the lowest level ever recorded.  The following comes from Wolf Richter…

The China Containerized Freight Index (CCFI), published weekly, tracks contractual and spot-market rates for shipping containers from major ports in China to 14 regions around the world. Unlike most Chinese government data, this index reflects the unvarnished reality of the shipping industry in a languishing global economy. For the latest reporting week, the index dropped 4.1% to 705.6, its lowest level ever.

How many numbers like this do we have to get before we will all finally admit that we are in the midst of a major global economic meltdown?

Here in the United States, the recent rally in the stock market has most people feeling pretty good about things these days.  But the truth is that there are ups and downs during any financial crisis, and this recent rally is putting the finishing touches on a very dangerous leaning “W” pattern that could signal a big dive ahead.

Harry Dent, the author of “The Demographic Cliff: How to Survive and Prosper During the Great Deflation Ahead“, has shown that this leaning “W” pattern is part of a huge “rounded top” for the S&P 500.  The following is a brief excerpt from one of his recent articles…

The bull market from early 2009 into May 2015 looks just like every bubble in history, and I’m getting one sign after the next that we did indeed peak last May. The dominant pattern in the stock market is the “rounded top” pattern:

After trading in a steep, bubble-like channel from late 2011 into late 2014, with only 10% maximum volatility top to bottom, the market finally lost its momentum… just as the Fed finished tapering its QE. That’s because the Fed was the primary driver in this stock bubble in the first place!

Now is not the time to relax at all.

In fact, now is the time to sound the alarm louder than ever.

That is one reason why my wife and I have started up a new television program.  It will be airing on Christian television, but it will also be available on YouTube as well…



As I have said before, 2016 is the year when everything changes.

So don’t be fooled just because the stock market had a couple of good weeks.  The truth is that global economic activity is slowing down significantly, geopolitical instability continues to get even worse, and this political season has caused very deep, simmering tensions in the United States to rise to the surface.

Let us hope that we have a few more weeks of relative stability like we are currently experiencing so that we can have more time to get prepared, but I certainly wouldn’t count on it.

The Federal Reserve Just Made Another Huge Mistake - Michael Snyder THE ECONOMIC COLLAPSE

The Federal Reserve Just Made Another Huge Mistake

Posted: 27 Jan 2016   Michael Snyder  THE ECONOMIC COLLAPSE

As stocks continue to crash, you can blame the Federal Reserve, because the Fed is more responsible for creating the current financial bubble that we are living in than anyone else.  When the Federal Reserve pushed interest rates all the way to the floor and injected lots of hot money into the financial markets during their quantitative easing programs, this pushed stock prices to wildly artificial levels. 

The only way that it would have been possible to keep stock prices at those wildly artificial levels would have been to keep interest rates ultra-low and to keep recklessly creating lots of new money.  But now the Federal Reserve has ended quantitative easing and has embarked on a program of very slowly raising interest rates.  This is going to have very severe consequences for the markets, but Janet Yellen doesn’t seem to care.

There is a reason why the financial world hangs on every single word that is issued by the Fed.  That is because the massively inflated stock prices that we see today were a creation of the Fed and are completely dependent on the Fed for their continued existence.

Right now, stock prices are still 30 to 40 percent above what the economic fundamentals say that they should be based on historical averages.  And if we are now plunging into a very deep recession as I contend, stock prices should probably fall by a total of more than 50 percent from where they are now.

The only way that stock prices could have ever gotten this disconnected from economic reality is with the help of the Federal Reserve.  And since the U.S. dollar is the primary reserve currency of the entire planet, the actions of the Fed over the past few years have created stock market bubbles all over the globe.

But the only way to keep the party going is to keep the hot money flowing.  Unfortunately for investors, Janet Yellen and her friends at the Fed have chosen to go the other direction.  Not only has quantitative easing ended, but the Fed has also decided to slowly raise interest rates.  The Fed left rates unchanged on Wednesday, but we were told that we are probably still on schedule for another rate hike in March.

So how did the markets respond to the Fed?

Well, after attempting to go green for much of the day, the Dow started plunging very rapidly and ended up down 222 points.

The markets understand the reality of what they are now facing.  They know that stock prices are artificially high and that if the Fed keeps tightening that it is inevitable that they will fall back to earth.

In a true free market system, stock prices would be far, far lower than they are right now.  Everyone knows this – including Jim Cramer.  Just check out what he told CNBC viewers earlier today…

Jim Cramer was tempted to resurface his “they know nothing” rant after hearing the Fed speak on Wednesday. He was hoping that a few boxes on his market bottom checklist might be checked off, but it seems that the bear market has not yet run its course.
“The Fed’s wishy-washy statement on interest rates today left stocks sinking back into oblivion after a nice rally yesterday,” the “Mad Money” host said.

Without artificial help from the Fed, stocks will most definitely continue to sink into oblivion.

That is because these current stock prices are not based on anything real.

And so as this new financial crisis continues to unfold, the magnitude of the crash is going to be much worse than it otherwise would have been.

It has often been said that the higher you go the farther you have to fall.  Because the Federal Reserve has pumped up stock prices to ridiculously high levels, that just means that the pain on the way down is going to be that much worse.

It is also important to remember that stocks tend to fall much more rapidly than they rise.  And when we see a giant crash in the financial markets, that creates a tremendous amount of fear and panic.  The last time there was great fear and panic for an extended period of time was during the crisis of 2008 and 2009, and this created a tremendous credit crunch.
During a credit crunch, financial institutions because very hesitant to lend to one another or to anyone else.  And since our economy is extremely dependent on the flow of credit, economic activity slows down dramatically.

As this current financial crisis escalates, you are going to notice certain things begin to happen.  If you own a business or you work at a business, you may start to notice that fewer people are coming in, and those people that do come in are going have less money to spend.
As economic activity slows, employers will be forced to lay off workers, and many businesses will shut down completely. 

And since 63 percent of all Americans are living paycheck to paycheck, many will suddenly find themselves unable to meet their monthly expenses.  Foreclosures will skyrocket, and large numbers of people will go from living a comfortable middle class lifestyle to being essentially out on the street very, very rapidly.

At this point, many experts believe that the economic outlook for the coming months is quite grim.  For example, just consider what Marc Faber is saying…

It won’t come as a surprise to market watchers that “Dr. Doom” Marc Faber isn’t getting any more cheerful.
But the noted bear at least found a sense of humor on Wednesday into which he could channel his bleakness.
The publisher of the “Gloom, Boom & Doom Report” told attendees at the annual “Inside ETFs” conference that the medium-term economic outlook has become “so depressing” that he may as well fill a newly installed pool with beer instead of water.

If the Federal Reserve had left interest rates at more reasonable levels and had never done any quantitative easing, we would have been forced to address our fundamental economic problems more honestly and stock prices would be far, far lower today.

But now that the Fed has created this giant artificial financial bubble, the coming crash is going to be much worse than it otherwise would have been.  And the tremendous amount of panic that this crash will cause will paralyze much of the economy and will ultimately lead to a far deeper economic downturn than we witnessed last time around.

Once the Fed started wildly injecting money into the system, they had no other choice but to keep on doing it.

By removing the artificial support that they had been giving to the financial markets, they are making a huge mistake, and they are setting the stage for an economic tragedy that will affect the lives of every man, woman and child in America.

Michael Snyder - On The Brink of a Financial Crisis (Day 3) - The Jim Bakker Show

Watch here: Michael Snyder 
- On The Brink of a Financial Crisis (Day 3) 

- The Jim Bakker Show

Middle class in America has shrunk dramatically.

Watch here: Michael Snyder 
- On The Brink of a Financial Crisis (Day 3) 

- The Jim Bakker Show

Michael Snyder

Jim Bakker Show 2016 | Show# 2920 | Aired on January 18, 2016

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