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Aug. 2nd, 2010 03:08 am
From Twitter 08-01-2010
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Aug. 2nd, 2010
Aug. 2nd, 2010 01:38 pm
What is really wrong with North America:
"Dubbed “median wage stagnation” by economists, the annual incomes of the bottom 90 per cent of US families have been essentially flat since 1973 – having risen by only 10 per cent in real terms over the past 37 years."
http://www.ft.com/cms/s/2/1a8a5cb2-9ab2-11df-87e6-00144feab49a.html
When a family with a combined income of US$ 70,000 is constantly only 3 weeks away from homelessness this is not a good thing.
The rich get richer and the poor get poorer:
"Most economists see the Great Stagnation as a structural problem – meaning it is immune to the business cycle. In the last expansion, which started in January 2002 and ended in December 2007, the median US household income dropped by $2,000 – the first ever instance where most Americans were worse off at the end of a cycle than at the start."
On Detroit: "Think of the typical Detroit car worker 30 years ago, who had a secure middle-class lifestyle, good health care and a fat pension to look forward to. Today, he lives in Shenzhen, China."
Paul Krugman, The New York Times columnist and Nobel prize winner, weighs in : "who blames it on politics, notably the conservative backlash which began when Ronald Reagan came to power in 1980, and which sped up the decline of unions and reversed the most progressive features of the US tax system."
You can scare me I no longer work in a union: "Fewer than a tenth of American private sector workers now belong to a union. People in Europe and Canada are subjected to the same forces of globalization and technology. But they belong to unions in larger numbers and their health care is publicly funded. More than half of household bankruptcies in the US are caused by a serious illness or accident."
Why did we not notice this? Cheap debt: "For years, the problem was cushioned and partially hidden by the availability of cheap debt. Middle-class Americans were actively encouraged to withdraw equity from their homes, or leach from their retirement funds, in the confidence that property prices and stock markets would permanently defy gravity (a view, among others, promoted by half the world’s Nobel economics prize winners, Spence not included). That cushion is now gone. Easy money has turned into heavy debt. Baby boomers have postponed retirements. College graduates are moving back in with their parents. "
Mortgage tomorrow to pay for today is not working anymore.
http://www.ft.com/cms/s/2/1a8a5cb2-9ab2-11df-87e6-00144feab49a.html
When a family with a combined income of US$ 70,000 is constantly only 3 weeks away from homelessness this is not a good thing.
The rich get richer and the poor get poorer:
"Most economists see the Great Stagnation as a structural problem – meaning it is immune to the business cycle. In the last expansion, which started in January 2002 and ended in December 2007, the median US household income dropped by $2,000 – the first ever instance where most Americans were worse off at the end of a cycle than at the start."
On Detroit: "Think of the typical Detroit car worker 30 years ago, who had a secure middle-class lifestyle, good health care and a fat pension to look forward to. Today, he lives in Shenzhen, China."
Paul Krugman, The New York Times columnist and Nobel prize winner, weighs in : "who blames it on politics, notably the conservative backlash which began when Ronald Reagan came to power in 1980, and which sped up the decline of unions and reversed the most progressive features of the US tax system."
You can scare me I no longer work in a union: "Fewer than a tenth of American private sector workers now belong to a union. People in Europe and Canada are subjected to the same forces of globalization and technology. But they belong to unions in larger numbers and their health care is publicly funded. More than half of household bankruptcies in the US are caused by a serious illness or accident."
Why did we not notice this? Cheap debt: "For years, the problem was cushioned and partially hidden by the availability of cheap debt. Middle-class Americans were actively encouraged to withdraw equity from their homes, or leach from their retirement funds, in the confidence that property prices and stock markets would permanently defy gravity (a view, among others, promoted by half the world’s Nobel economics prize winners, Spence not included). That cushion is now gone. Easy money has turned into heavy debt. Baby boomers have postponed retirements. College graduates are moving back in with their parents. "
Mortgage tomorrow to pay for today is not working anymore.