The primary cause of the west's demographic problem is kleptocracy

[Swordsmyth]

Researchers at Purdue University recently studied data culled from across the globe and found that “happiness” doesn’t rise indefinitely with income. In fact, there were cut-off points at which more annual income had a negative effect on overall life satisfaction.
So, what’s that number? In the U.S., $65,000 was found to be the optimal income for “feeling” happy.
While the media jumped on the headline, given median national incomes are closing in on $60,000, they should have actually read the rest of the study.
The income figure is per individual.
So to calculate the required income number for “happiness” you must multiply that number by the square root of the household size. So, what’s the number for a couple, or a family of three or four?

• $65,000 x √2 = $92,000/year
• $65,000 x √3 = $112,000/year
• $65,000 x √4 = $130,000/year

That is an entirely different message from what most have been led to believe. An income of $130,000/year is far above the average incomes from most Americans currently and ability to maintain the basic lifestyle is becoming ever more problematic.
In the U.S., despite higher levels of low income (now there’s an oxymoron), inflation-adjusted median incomes have remained virtually stagnant since 1998.

However, the chart above is grossly misleading because the income gains have only occurred in the Top 20% of income earners. For the bottom 80%, they are well short of the incomes needed to obtain “happiness.”

For most American “families”, who have to balance their living standards to their income, the “experience” of “happiness” is more of a function of “meeting obligations” each and every month.
Today, more than ever, the walk to the end of the driveway has become a dreaded thing as bills loom large in the dark crevices of the mailbox. If they can meet those obligations, they are “happy.” If not, not so much.
The Financial Crisis Mindset

In my opinion, what the study failed to capture was the “change” in what was required to achieve “perceived” happiness following the “financial crisis.”
Just as with “The Great Depression,” individuals forever altered their feelings about banks, saving and investing after an entire generation had lost “everything.” It is the same today as sluggish wage growth has failed to keep up with the cost of living which has forced an entire generation into debt just to make ends meet.
As the chart below shows, while savings spiked during the financial crisis, the rising cost of living for the bottom 80% has outpaced the median level of “disposable income” for that same group. As a consequence, the inability to “save” has continued.

So, if we assume a “family of four” needs an income of $132,000 a year to be “happy,” such becomes problematic for the bottom 80% of the population whose wage growth falls far short of what is required to support the standard of living, much less to obtain “happiness.”
The “gap” between the “standard of living” and real disposable incomes is more clearly shown below. Beginning in 1990, incomes alone were no longer able to meet the standard of living so consumers turned to debt to fill the “gap.”
However, following the “financial crisis,” even the combined levels of income and debt no longer fill the gap. Currently, there is almost a $7000 annual deficit that cannot be filled.

The mirage of consumer wealth has been a function of surging debt levels which was accumulated during the credit boom. The problem is the debt simply can’t be disposed of through ordinary means.

• Many can’t sell their house because they can’t qualify to buy a new one
• The cost to rent is now higher than current mortgage payments in many places
• There is no ability to substantially increase disposable incomes because of deflationary wage pressures; and,
• Despite the mainstream spin on recent statistical economic improvements, the burdens on average American families are increasing namely in the things they can’t control – health care, energy, and housing.

Nothing brought this to light more than the recent release of the Fed’s Report on “The Economic Well-Being Of U.S. Households.” The overarching problem can be summed up in one chart:

This isn’t just about the “baby boomers,” either.
Millennials are haunted by the same problems, with 40%-ish unemployed, or underemployed, and living back home with parents. In turn, parents are now part of the “sandwich generation” that are caught between taking care of kids and elderly parents. The rise in medical costs and health care goes unabated consuming more of their incomes.
More importantly, despite economic reports of rising employment, low jobless claims, surging corporate profitability and continuing economic expansion, the percentage of government transfer payments (social benefits) as compared to disposable incomes have surged to the highest level on record.

More Money

Of course, by just looking at household net worth, once again you would not really suspect a problem existed. In the Fed’s latest Flow of Funds report, the Fed revealed households currently held $112.4 trillion in assets with just a modest $15.4 trillion in liabilities, which brought the net worth of the average US household to a new all-time high of $96.9 trillion. The majority of the increase over the last several years has come from increasing real estate values and the rise in various stock-market linked financial assets like corporate equities, mutual and pension funds.

However, once again, the headlines are deceiving even if we just slightly scratch the surface. Given the breakdown of wealth across America we once again find that virtually all of the net worth, and the associated increase thereof, has only benefited a handful of the wealthiest Americans.
Despite the mainstream media’s belief that surging asset prices, driven by the Federal Reserve’s monetary interventions, has provided a boost to the overall economy, it has really been anything but. Given the bulk of the population either does not, or only marginally, participates in the financial markets, the “boost” has remained concentrated in the upper 10%. The Federal Reserve study breaks the data down in several ways, but the story remains the same – “if you are wealthy – life is good.”

The illusion by many of ratios of “economic prosperity,” such as debt-to-income ratios, wages, assets, etc., is they are heavily skewed to the upside by the top 20%. Such masks the majority of Americans who have an inability to increase their standard of living.
While the ongoing interventions by the Federal Reserve have certainly boosted asset prices higher, the only real accomplishment has been a widening of the wealth gap between the top 10% of individuals that have dollars invested in the financial markets and everyone else. What monetary interventions have failed to accomplish is an increase in production to foster higher levels of economic activity.
Of course, when couples are stressed financially, they also become stressed “sexually.”
Less Sex

Not surprisingly, the “financial stress” in American households is leading to other factors which are fueling the “demographic” problem in the future. The equation is very simple – when individuals are stressed over finances they are less active sexually.
This was shown in a recent study by the National Bureau of Economic Research. Ahead of the past three US recessions, the number of conceptions began to fall at least six months before the economy started to contract. As the FT notes, while previous research has shown how birth rates track economic cycles, the scientific study is the first to show that fertility declines are a leading indicator of recessions.
Daniel Hungerman, economics professor at the University of Notre Dame and one of the report’s authors, said

“It is ‘striking’ that the drop in pregnancies was evident before the recession that came after the 2007 financial crisis, since it has traditionally been argued that this slump had been hard to predict.”

The analysis used data on the 109 million births in the US between 1989-2016 to examine how fertility rates changed through the last three economic cycles — in the early 1990’s, the early 2000’s, and the late 2000’s. A similar pattern emerged in all three cases.
In other words, less sex with the intent to procreate.

“One way to think about this is that the decision to have a child often reflects one’s level of optimism about the future,” says Kasey Buckles, another Notre-Dame professor and co-author of the study. Research published through the NBER is often conducted by academics at their own universities.

To the researchers’ surprise, they found that falls in conceptions were a far better leading indicator of recessions than many commonly used indicators such as consumer confidence, measures of uncertainty, and purchases of big-ticket items such as washing machines and cars.

Of course, this decline in fertility, fuels one of the primary problems facing the U.S. over the next 30-years – the decline in the ratio of workers per retiree or “demographics.” As retirees are living longer (increasing the relative number of retirees), and lower birth rates (decreasing the relative number of workers.)the “support ratio” is falling sharply.

The problem for American families today, despite media commentary to the contrary, is simply the inability to maintain their current standard of living. When incomes remain stagnant, or falls, due to job loss or reduction in pay, the impact on the budget at home is significant when there are already very low saving rates and the inability to access a tight credit market. The recent surge in consumer debt, with little relative increase in overall personal consumption expenditures, shows this to be the case. For Main Street, the economy remains mired at sub-par growth rates ten-years into a post-recessionary environment.

More at: https://www.zerohedge.com/news/2018-...oney-happiness

[Swordsmyth]

Just two months of stress may damage a man's sperm and slash his chances of having children, a new study suggests.
Israeli scientists found men are 47 per cent more likely to have swimmers with weak motility if they are under intense pressure.
Weak motility – known to be affected by lifestyle choices - makes it less likely that the sperm will successfully fertilise an egg.
The findings were derived from 11,000 sperm samples, including those of adults exposed to 'regular rocket warning sirens' in the Gaza Strip.


Researchers at Ben-Gurion University of the Negev and Soroka University Medical Center in Beer-Sheva led the study.
They analysed 10,535 sperm samples donated by men during periods in Israel deemed ‘unstressful’ between 2009 and 2017.
These were then compared to 659 samples from men take up to two months after fierce military battles between Israel and Gaza.


The men had an average age of 32, which, according to figures, is the average age for first time fathers in the UK.
Even though the findings related to just those living in conflict zones, the researchers argued they could apply to any mental stress.
Dr Eliahu Levitas, study author, said: ‘This study shows that prolonged stress can have an effect on sperm quality.
‘Mental stress is known to have an adverse effect on fertility, but there is little research on the impact of stress on sperm quality.’

More at: http://www.dailymail.co.uk/health/ar...ans-sperm.html

[dannno]

Just two months of stress may damage a man's sperm and slash his chances of having children, a new study suggests.
Israeli scientists found men are 47 per cent more likely to have swimmers with weak motility if they are under intense pressure.
Weak motility – known to be affected by lifestyle choices - makes it less likely that the sperm will successfully fertilise an egg.
The findings were derived from 11,000 sperm samples, including those of adults exposed to 'regular rocket warning sirens' in the Gaza Strip.


Researchers at Ben-Gurion University of the Negev and Soroka University Medical Center in Beer-Sheva led the study.
They analysed 10,535 sperm samples donated by men during periods in Israel deemed ‘unstressful’ between 2009 and 2017.
These were then compared to 659 samples from men take up to two months after fierce military battles between Israel and Gaza.


The men had an average age of 32, which, according to figures, is the average age for first time fathers in the UK.
Even though the findings related to just those living in conflict zones, the researchers argued they could apply to any mental stress.
Dr Eliahu Levitas, study author, said: ‘This study shows that prolonged stress can have an effect on sperm quality.
‘Mental stress is known to have an adverse effect on fertility, but there is little research on the impact of stress on sperm quality.’

More at: http://www.dailymail.co.uk/health/ar...ans-sperm.html

Hmm, I would have thought the regular rocket warnings would have made the sperm swim faster.

[DamianTV]

They've stolen our future to pay for the wars of the present.

[timosman]

They've stolen our future to pay for the wars of the present.

[Swordsmyth]

Suicide rates are up 30 percent since 1999, CDC says

[Swordsmyth]

The following are 15 signs that the middle class in the United States is being systematically destroyed…
#1 78 million Americans are participating in the “gig economy” because full-time jobs just don’t pay enough to make ends meet these days.
#2 In 2011, the average home price was 3.56 times the average yearly salary in the United States. But by the time 2017 was finished, the average home price was 4.73 times the average yearly salary in the United States.
#3 In 1980, the average American worker’s debt was 1.96 times larger than his or her monthly salary. Today, that number has ballooned to 5.00.
#4 In the United States today, 66 percent of all jobs pay less than 20 dollars an hour.
#5 102 million working age Americans do not have a job right now. That number is higher than it was at any point during the last recession.
#6 Earnings for low-skill jobs have stayed very flat for the last 40 years.
#7 Americans have been spending more money than they make for 28 months in a row.
#8 In the United States today, the average young adult with student loan debt has a negative net worth.
#9 At this point, the average American household is nearly $140,000 in debt.
#10 Poverty rates in U.S. suburbs “have increased by 50 percent since 1990”.
#11 Almost 51 million U.S. households “can’t afford basics like rent and food”.
#12 The bottom 40 percent of all U.S. households bring home just 11.4 percent of all income.
#13 According to the Federal Reserve, 4 out of 10 Americans do not have enough money to cover an unexpected $400 expense without borrowing the money or selling something they own.
#14 22 percent of all Americans cannot pay all of their bills in a typical month.
#15 Today, U.S. households are collectively 13.15 trillion dollars in debt. That is a new all-time record.
When you think of “poverty in America”, you probably think of our blighted inner cities, but that is not where poverty is growing the fastest.
According to author Scott Allard, it is actually our suburbs where poverty is growing more rapidly than anywhere else…

According to a May report from the Pew Research Center, since 2000, suburban counties have experienced sharper increases in poverty than urban or rural counties.
This is consistent with research across the U.S. over the past decade – as well as my own book, “Places in Need.”

This is why tens of millions of square feet of retail space is being closed down and why formerly great shopping malls all over America now resemble ghost towns.
When I was growing up, the shopping mall was the place to be for average middle class kids. My family was middle class and virtually everyone that I knew was middle class. In fact, I don’t remember any really wealthy or really poor kids in my school at all.
But today most families have little to no financial cushion and are deep in debt. As a result, discretionary income has really dried up and that means less shopping.
So we are on pace for the worst year for store closings in American history, and yet the mainstream media keeps telling us that the economy is in “good shape”.
That is a load of nonsense. The numbers don’t lie, and the U.S. economy is never going to be in “good shape” until the middle class starts growing again.

More at: https://www.zerohedge.com/news/2018-...ally-destroyed

[Swordsmyth]

Young adults list the high expense of child care as a top reason for having fewer kids, according a New York Times poll released Thursday.
Fertility rates in the U.S. are at a record low for the second year in a row, according to data released earlier this year, with the Times' new poll shedding light on some of the major reasons behind the drop.
While 64 percent of the poll’s respondents said they are having fewer children because “child care is too expensive,” roughly half, 49 percent, said they are “worried about the economy,” 43 percent said they “waited because of financial instability” and 39 percent cited “no paid family leave.”


The decline in U.S. fertility rates began with the Great Recession in 2008 and has continued steadily for the past decade, baffling those who assumed the rate would pick back up when the economy recovered, the Times noted.
The number of births for every 1,000 women of childbearing age was 60.2 last year, a rate that is similar to other industrialized nations but the lowest the U.S. has ever seen.
Among respondents who said they did not plan to have children, around a quarter, 23 percent, cited the economy as a deterrent, while 24 percent said they couldn't afford a house. Other major factors surveyed were personal in nature, such as the desire for more leisure time or not having found a partner.

More at: http://thehill.com/homenews/news/395...r-having-fewer

[Swordsmyth]

[Swordsmyth]

Two things stood out in the December jobs report: first, the magnitude of the monthly increase in payrolls, which at 312K was the highest in 10 months and second, the stark increase in annual wage growth.As Reuters Jeoff Hall notes, 12 of the 15 major industry sectors (4 in goods-producing, 11 in service-providing) have 12-month growth rates in avg hourly earnings that exceed the Fed's 2.0% inflation target (with exceptions being Transportation & Warehousing (+0.7%), Nondurable Gds Mfg (+0.9%), Other Services at +1.8%).
However, reading between the lines reveals another somewhat unpleasant signal and may explain the impressive wage growth: the bulk of jobs in December went to aged workers, those 55 and older, who increased by 183K (according to the Household Survey). Meanwhile, the prime age group, those aged 25-54, actually declined by 11K in December. And since it was the younger age cohorts that saw virtually no job growth in December - i.e., those workers who have the least wage negotiating leverage - it explains the impressive wage growth, but it is also a potentially troubling indicator as it confirms that employers are primarily focusing on hiring those workers who already have experience, instead of permitting younger entrants to join the labor force.

How does the data look on an annual basis, from December 2017 to December 2018: a little better, with the biggest age cohort, those 25-54 rising by 1.3 million, but it was once again the oldest workers, those 55 and older that have seen the bulk of job gains in the past year, confirming that younger Americans are having an increasingly harder time to find jobs when they are, well, competing with their parents, who have been unable to retire as a result of ten years of ZIRP which in turn crushed savings for an entire generation of (elderly) Americans, forcing them to stay in the job market well beyond their retirement age.




https://www.zerohedge.com/news/2019-...-jobs-december

[Swordsmyth]

The U.S. economy is booming, right?
Republicans think President Trump deserves much of the credit for cutting business and individual tax rates combined with a deregulation agenda. And Democrats believe former President Obama deserves ownership for America’s recovery. Regardless of who gets credit, HowMuch.net's newest visualization of net compensation levels for American workers demonstrates that the economy is indeed delivering, but not for as many people as the headlines would have you believe...



The Social Security Administration (SSA) tracks net income numbers after taxes through the Average Wage Index (AWI). We broke the AWI into a three-part hierarchy of $5K increments, letting you easily see the reality of income inequality in the U.S.. Astonishingly, 13% of workers make less than $5K, and nearly half, or 48%, take home $31,561 or less in net compensation (the dark red on our visual). If your mind isn’t spinning yet, consider the fact that these numbers are all after a multi-year economic recovery. The U.S. is allegedly at or near full employment but wages are barely growing, meaning these numbers are probably the best case scenario. Imagine what a recession would do to worker paychecks.
There is one important caveat to keep in mind when thinking about our dataset. The SSA numbers include any wage earners whatsoever, even part-time workers like students and teenagers. If the worker reports his or her income to the IRS on a W2 form, he or she is included in these stats. This drags down the aggregate wage numbers for full-time working adults, which reach $61,372 for households last year.
All that being said, the picture is still depressing. 1.4% of workers make between $250K - 50M, and another 8.2% bring home between $100K - 250K. Remember, these numbers reflect individual earners, meaning they don’t take into account household earnings. We mention this only because wealthy people tend to get married at higher rates than poor people. In other words, wage earners at the top of the income ladder are probably much wealthier than even these numbers would suggest since their spouses are generally highly educated and well-compensated too.
The visualization makes it plain to see that most people take home very little money from their jobs. The federal poverty level for a family of 4 is $25,100, which officials believe is the bare minimum needed to purchase subsistence food, clothing and shelter. To put this another way, the visualization indicates that enormous chunks of the workforce make a substandard wage, putting them at extreme risks if unpredictable financial problems occur.


https://www.zerohedge.com/news/2019-...arn-less-30000

[DamianTV]

Same $#@! different day. For a few to be rich, many must be poor.

[Swordsmyth]

Same $#@! different day. For a few to be rich, many must be poor.

That's not entirely true but this is about power and power IS relative, the last few generations of oligarchs have been so power mad that they are pushing our society and the whole world to the breaking point in order to achieve obscene levels of relative wealth and power.

[DamianTV]

That's not entirely true but this is about power and power IS relative, the last few generations of oligarchs have been so power mad that they are pushing our society and the whole world to the breaking point in order to achieve obscene levels of relative wealth and power.

Fully agreed.

If they had to earn their money the way we do, they'd never get off the ground. The foundation of their wealth truly is Belief Money and Violence. Belief comes into play when they persuade others of lesser intelligence that there is nothing inherently Dishonest about either Fiat Currency or Fractional Reserve Systems, which is why they utterly despise the Gold Standard. Once they have influenced Belief / Perceptions by confusing the differences between Money and Currency, they now have control of both Belief and Money. With both Belief and Money, they gather Enforcers of Violence to do their bidding. They control those enforcers by enticing with Money, which at the same time creates a Fear of Loss of that same manipulative Money (really currency at this point), causing those Enforcers to betray their own morals out of desperation and dependency. They end up with a Monopoly on all three Foundations.

Honest Money, not currency, frees the ordinary man, the man that does not understand the nature of Coin and Credit, from the clutches of the Money Manipulators, who are also Liars, and the most Violent in existence. Is it the soldier that is responsible for obeying the order to kill millions, or is it the person that issued the order? Many of those same men are hopelessly dependent on the issuers of that money which now controls their Obedience. The Elite are the Murderers of most of the worst atrocities carried out throughout history. It has been said that ALL WARS ARE BANKER WARS. So what happens when those same elite pit two countries against each other, in order to enslave their elected representatives to their bidding? They create an enemy, and those harmed by those manufactured enemies, desperate to secure funding for their wars turn to the Elite.

Thus, its not just the West's Demographic problem, but nearly every Humanitarian Crisis on the PLANET and throughout history has been caused by the Kleptocracy, who now desires TOTAL control by conversion to a Technocracy. Education, Media, even Churches are influenced by the power of their money. Stupidity is their most powerful weapon against the masses. By keeping people stupid, they are much more influenced, and can be easily convinced to believe absurdities, such as Fiat Currency is Money, and thus, manipulated to commit atrocities.

NOTE: I am out of Rep at the moment too.

[dannno]

Same $#@! different day. For a few to be rich, many must be poor.

Man is naturally born into a state of abject poverty. The question is not why are some people poor - the question is why are some people rich?

[shakey1]

That's not entirely true but this is about power and power IS relative, the last few generations of oligarchs have been so power mad that they are pushing our society and the whole world to the breaking point in order to achieve obscene levels of relative wealth and power.

truism... +rep

[Swordsmyth]

“Gradual inflation has a numbing effect. It impoverishes the lower and middle class, but they don’t notice.”
- Andrew Bosomworth, PIMCO Germany, as quoted in Der Spiegel

Media reports and political candidates have been stressing the rising wealth and income inequality gaps in the United States. They do so to advance their agendas, but the problem is real and they are justified in raising it. At the same time, both groups are largely overlooking an important piece of the puzzle in the way they talk about it. To properly diagnose this important problem, we need to understand the role the Federal Reserve plays in managing economic growth and how it contributes to these rising imbalances. This article examines the Federal Reserve’s monetary policy objectives and their stated inflation goals to help you better appreciate the role they play in this troubling and growing problem.
Populism on the Rise

The political success of Donald Trump, Bernie Sanders and more recently Alexandra Ocasio-Cortez leave scant doubt that populism is on the rise. Voters from both parties are demanding change and going to extremes to achieve it. Much of what is taking place is rooted in the emergence of the greatest wealth inequality gap since the roaring ’20s.
Over the last twenty years, the “1%” have been able to accumulate wealth at an ever-increasing rate. According to the Economic Policy Institute, the top 1% take home 21% of all income in the United States, the largest share since 1928. The graph below, while slightly dated, shows the drastic change in income trends that have occurred over the last 35 years.


Graph Courtesy: New York Times – One Broken Economy, in One Simple Chart


This grab for riches by the few is coming at the expense of the many. There are a variety of social, political and economic factors driving the growing discrepancy, but there is one critical factor that is being ignored.

Enter the Federal Reserve

The Federal Reserve Act, as amended in 1977, contains three mandates dictating the management of monetary policy. They are 1) maximize employment, 2) maintain stable prices, and 3) keep long-term interest rates moderate.
These broadly-worded objectives afford the Federal Reserve great latitude in interpreting the Act. Among these, the Fed’s mandate for stable prices is worth a closer look. The Fed interprets “stable prices” as a consistent rate of price increases or inflation. Per the Federal Reserve Bank of Chicago, “The Committee judges that inflation at the rate of 2 percent, as measured by the annual change in the price index for Personal Consumption Expenditures (PCE), is most consistent over the longer run with the Federal Reserve’s statutory mandate.”
Understanding why the wealth gap has exploded in recent years requires an appreciation for how this small but consistent rate of inflation harms the poor and middle class while simultaneously enriching the already wealthy.
Wealth is defined as that which is left after consumption and the accumulated results of those savings over time.
With that in mind consider inflation from the standpoint of those living paycheck to paycheck. These citizens are often paid on a bi-weekly basis and spend all of their income throughout the following two weeks. In an inflationary state, one’s purchasing power or the amount of goods and services that can be purchased per dollar declines as time progresses. Said differently, the value of work already completed declines over time. While the erosion of purchasing power is imperceptible in a low inflation environment, it is real and reduces what little wealth this class of workers earned. Endured over years, it has adverse effects on household wealth.
Now let’s focus on the wealthy. A large portion of their earnings are saved and invested, not predominately used to pay rent or put food on the table. While the value of their wealth is also subject to inflation, they offset the negative effects of inflation and increase real wealth by investing in ways that take advantage of rising inflation. Further, the Fed’s historically low-interest-rate policy, which supports 2% inflation, allows the more efficient use of financial leverage to increase wealth.
Some may counter that daily laborers living week to week get pay raises that offset inflation. That may be true, but it also assumes inflation is measured correctly. The Fed relies upon the Consumer Price Index (CPI) and Personal Consumption Expenditures (PCE) metrics as gauges of inflation. While widely accepted, we all have firsthand experience of the rapid rise in the cost of health care, higher education, rents, and many other essential goods and services that suggests far greater inflation than the Fed’s 2% objective. The truth is that inflation is not measurable with any real accuracy.
John Williams, of Shadow Stats, calculates inflation based on the methods used by the Bureau of Labor Statistics in 1980. Currently, his calculation has CPI running at 9.9% per year, much higher than the latest 2.2% CPI reported. The difference between Williams’ calculation and the BLS’ reported figure is caused by the numerous adjustments the BLS has made to the CPI calculation over the years which has reduced reported inflation. Economists argue that the BLS adjustments provide better accuracy. Maybe, but the record level of wealth inequality and public dissatisfaction offers hard evidence to the contrary. Disagreements notwithstanding, the loss of wealth due to inflation, whether at 2% or 10%, is punishing for those spending everything as it limits their ability to save and accumulate wealth.
Economic growth as measured by Gross Domestic Production (GDP) is the holy grail of all measures of economic advancement. Rising GDP in a debt-based economy depends on credit growth which explains why inflation is so important to policy-makers. The logical conclusion is that the Fed’s primary purpose for running a consistent rate of inflation is to foster credit growth. The growth of credit benefits those who have collateral to borrow against, employ leverage and invest. Again, it is the wealthy that benefit from this. For everyone else, it is a merciless master that makes it difficult if not impossible to maintain one’s standard of living.
The more of one’s wealth that is used for consumption, the more one is subject to the ills of inflation. Additionally, this circumstance also drives a negative feedback loop in that inflation also quietly incents people to consume since goods and services will be more expensive tomorrow than they are today.
While we illustrate the extremes in this article, one can envision how the middle class, which increasingly spend the majority of their wages on consumption and invest little or nothing, also fall into the inflation trap.
Summary

The central banking scheme of supporting economic growth through increasing levels of debt only makes sense if “growth at all cost” uniformly benefits all citizens, but it does not. There is a big difference between growth and prosperity. Furthermore, an inflationary policy that aims to minimize the burden of debt while at the same time aggravating the growth of those burdens is taking a serious toll on global economic and social stability.
As we are finding, the United States is not immune to these disruptions. The source of these problems are accumulating and compounding as a result of the public’s failure to understand why it is happening. This will ultimately lead to further policy-making errors. Until the Fed’s policies are publicly discussed, re-examined and ultimately reconsidered, the problems will not resolve themselves.


https://www.zerohedge.com/news/2019-...nt-one-percent

[Swordsmyth]

[Swordsmyth]

Kang Sung-il buys Sancho, his Pomeranian, a toy every business trip and this Lunar New Year holiday will dress him up in a new $50 suit to visit ‘grandma’, Kang’s mother.

Kang and his wife say children are too expensive and bring too much pressure. Instead they have opted to shower Sancho with love and gifts.
They are not alone. South Korea’s pet industry is booming, fueled by the same factors that have made the country’s birth rate, at 1.05 births per woman, the lowest in the world: the high cost of education and housing as well as extremely long working days.
“Social pressures in South Korea are such that parents are required to provide resources for decades from private schooling to tutoring to art classes,” said Kang, a 39-year old manager of a pet funeral home.
He says he found it hard to imagine being able to afford all that but is happy to spend about 100,000 won ($90) a month on Sancho.
On top of education expenses, an average South Korean household must budget roughly 12.8 years of income to buy a mid-range home, compared to 8.8 years in 2014, data from KB Kookmin Bank shows. Adding to their stress, South Koreans work the third most hours per year among OECD nations, lagging just Mexico and Costa Rica.


“The pet population is growing as more people choose not to have babies or even not to marry,” said Kim Soo-kyung, manager at Samjong KPMG Economic Research Institute.
Pet-owning households have surged to 28 percent of all South Korean households in 2018, compared with 18 percent in 2012, government data shows.
That in turn has spurred a flourishing pet care industry whose offerings include tailored pet diets and high-priced photo shoots. Pet-related startups are also in vogue with venture capitalists.
The South Korean pet-related industry was worth 2.7 trillion won ($2.4 billion) last year, and that could more than double in size by 2027, according to the Korea Rural Economic Institute.

More at: https://www.reuters.com/article/us-s...KCN1PI029?il=0

[Swordsmyth]

According to recent studies, the vast majority of the American middle class is only one missed paycheck away from poverty. About 78% of workers in the United States are living paycheck to paycheck, and the statistics don’t improve from there.

Only 39% of Americans actually have saved enough money to cover a $1000 emergency. Nearly 3 in 4 workers say they are in debt and of those, more than half think they always will be, according to statistics posted by Forbes. Any rise in interest rates or the cost of food could leave some Americans with the tough choice of eating or paying the car payment to get to work.
A similar 2016 GOBankingRates survey found that 69 percent of Americans had less than $1,000 in total savings and 34 percent had no savings at all. That means many Americans would have to put an emergency expense on a credit card or borrow money another way just to cover the cost of a $1000 expense.
Making matters worse, the 2017 Report on the Economic Wellbeing of US Households stated that, when asked how they would cover an emergency expense of $400, only 59% of Americans said they could easily cover the expense using entirely cash, savings, or a credit card paid off at the next statement. But “four in ten adults would either borrow, sell something or not be able to pay” if faced with a $400 emergency expense.


Forbes reported that even without an unexpected expense, according to the Fed’s report, one in five (22%) can’t cover all their current month’s bills, and one in four skipped a medical treatment in the past year due to an inability to pay. Some of those use credit cards in between paychecks to scrape by and many know that they will be unable to pay back the money they have already borrowed.

More at: https://www.zerohedge.com/news/2019-...n-middle-class

[Swordsmyth]

Debt has become an issue of concern for those who care about their financial future. But with the government setting the terrible example of drastically spending more than they bring in, many in America are following suit and it is leading to a crisis and a red flag for the economy.

Just on the heels of the United States government’s debt surpassing $22 trillion comes the news that there are now a record number of Americans who are behind on their record high car payments. According to CNBC, more than 7 million Americans are at least 90 days behind on their auto loans, according to the New York Fed. This is a major concern, considering the average car payment in the U.S. is now $523.

“More and more people are buying too much car for what they can afford,” said Ed Mierzwinski, senior director of U.S. PIRG’s federal consumer program. Overall, auto debt accounts for about 9 percent of total U.S. consumer debt, up from 6 percent in late 2011, separate data from the Federal Reserve Bank of Kansas City show.
The amount of Americans currently in default of their car loans is higher than in 2010 when many were still reeling from the 2008 Great Recession, a statistic that is once again, showing that the U.S. economy may not be nearly as strong as the media’s talking heads present.

The “number of distressed borrowers suggests that not all Americans have benefited from the strong labor market and warrants continued monitoring and analysis of this sector,” Fed economists say.

Auto debt has soared and with that comes people who cannot pay the bill they signed up for. The dramatic uptick in delinquencies came along with a dramatic $584 billion jump in total auto loan debt. That’s the highest increase in car debt since the New York Fed began keeping track 19 years ago.

Overall, household debt rose by $32 billion, or 0.2 percent, to $13.54 trillion in the fourth quarter. That’s $869 billion higher than the crisis peak of $12.68 trillion and is 21.4 percent above the post-crisis low point in the second quarter of 2013.
Student loan debt edged higher to $1.46 trillion while credit card balances rose to $870 billion, right around their crisis peak. –CNBC

These delinquencies also come as Americans grapple with record levels of consumer debt and student loan debt. In a report issued Wednesday, U.S. PIRG warns that the continuing rise in auto debt is putting many consumers in a financially vulnerable position, which could worsen during an economic downturn. Coupled with consumer and student loan debt, Americans are staring a crisis in the face.

Overall debt carried by Americans also set off red flags as that number ticked up.Americans now owe a record $13.5 trillion and global debt is also a concern.

https://www.zerohedge.com/news/2019-...d-car-payments

[invisible]

But wait a second! How can the US be so poor, when according to statements here, we're hated and attacked and invaded by barbarians because we're so rich?

Here is only one of many examples contained in this thread:
http://www.ronpaulforums.com/showthr...-Months/page12

They don't come here because we are poor, they come here because we are rich and then they vote to destroy the very prosperity that attracted them with communism.

Please explain why they come here if it isn't the prosperity.

So, either all the articles in this thread are correct and we are poor, or the statements in the other thread are correct and we're rich! Am I the only one here who isn't a millioniare? Or are we only rich when it suits someone's agenda, and otherwise we're poor?

[Swordsmyth]

But wait a second! How can the US be so poor, when according to statements here, we're hated and attacked and invaded by barbarians because we're so rich?

Here is only one of many examples contained in this thread:
http://www.ronpaulforums.com/showthr...-Months/page12


So, either all the articles in this thread are correct and we are poor, or the statements in the other thread are correct and we're rich! Am I the only one here who isn't a millioniare? Or are we only rich when it suits someone's agenda, and otherwise we're poor?

Not everyone is rich, if you bothered to read the articles you would know that our society as a whole still is much richer than other societies but the rich and powerful have conspired with the welfare trash and hostile foreigners to steal an ever larger slice of the pie for themselves.

Thanks for playing.

[invisible]

Not everyone is rich, if you bothered to read the articles you would know that our society as a whole still is much richer than other societies but the rich and powerful have conspired with the welfare trash and hostile foreigners to steal an ever larger slice of the pie for themselves.

So the rich, the welfare checkers, and hostile foreigners are all in a conspiracy to steal from us, because we're rich but not everyone is rich? Hostile foreigners? Wouldn't that imply that non-hostile foreigners also exist?

[angelatc]

The problem for American families today, despite media commentary to the contrary, is simply the inability to maintain their current standard of living. When incomes remain stagnant, or falls, due to job loss or reduction in pay, the impact on the budget at home is significant when there are already very low saving rates and the inability to access a tight credit market. The recent surge in consumer debt, with little relative increase in overall personal consumption expenditures, shows this to be the case. For Main Street, the economy remains mired at sub-par growth rates ten-years into a post-recessionary environment.

More at: https://www.zerohedge.com/news/2018-...oney-happiness

This cuts off at 2011. The millennial are the largest generation in history - bigger than the Boomers. This old v young ratio should be reversing if that's the case. Provided there's enough of them not gay enough to make babies, that is.

[Swordsmyth]

So the rich, the welfare checkers, and hostile foreigners are all in a conspiracy to steal from us, because we're rich but not everyone is rich?

Not because we are rich, because we were rich and because we still produce great wealth attempting to get back to being rich.

Hostile foreigners? Wouldn't that imply that non-hostile foreigners also exist?

Yes, but without the ability to read minds we have a limited ability to find them so we must be cautious and limit the size of any bets we place on them.

[Swordsmyth]

This cuts off at 2011. The millennial are the largest generation in history - bigger than the Boomers. This old v young ratio should be reversing if that's the case. Provided there's enough of them not gay enough to make babies, that is.

That and the other factors (like poverty {particularly a declining standard of living as opposed to static poverty}) that discourage child rearing.

[Swordsmyth]

Our health insurance system is theoretically supposed to prevent Americans from going bankrupt when they are hit by huge medical bills.

But in case after case, that is simply not happening.
Even though more Americans are “covered by health insurance” than ever before, a new study has found that “about 530,000 families each year are financially ruined by medical bills and sicknesses”, and most of those families actually had health insurance.
These days, most health insurance policies closely resemble Swiss cheese because they are so full of loopholes, and health insurance companies have become masters at finding ways to wiggle off the hook. So every year hundreds of thousands of American families find themselves facing huge medical bills that they did not expect to be paying, and as a result medical expenses are the primary factor in 66.5 percent of all personal bankruptcy filings in the United States…

For many Americans, putting one’s health first can mean putting one’s financial status at risk. A study of bankruptcy filings in the United States showed that 66.5% were due, at least in part, to medical expenses.
The study, led by Dr. David Himmelstein, Distinguished Professor at the City University of New York’s (CUNY) Hunter College and Lecturer at Harvard Medical School, indicates that about 530,000 families each year are financially ruined by medical bills and sicknesses. It’s the first research of its kind to link medical expenses and bankruptcy since the passage of the Affordable Care Act (ACA) in 2010.

But wasn’t Obamacare supposed to make things better?
Yes, that was what we were promised, but the authors of the study discovered that the percentage of bankruptcies caused by medical bills actually went up by 2 percent after Obamacare went into effect…

The current study found no evidence that the ACA reduced the proportion of bankruptcies driven by medical problems: 65.5% of debtors cited a medical contributor to their bankruptcy in the period prior to the ACA’s implementation as compared to 67.5% in the three years after the law came into effect. The responses also did not differ depending on whether the respondent resided in a state that had accepted ACA’s Medicaid expansion. The researchers noted that bankruptcy is most common among middle-class Americans, who have faced increasing copayments and deductibles in recent years despite the ACA. The poor, who were most helped by the ACA, less frequently seek formal bankruptcy relief because they have few assets (such as a home) to protect and face particular difficulty in securing the legal help needed to navigate formal bankruptcy proceedings.

Even though more Americans are “in the system” than ever before, clearly what we are doing is simply not working.
As I detailed in my article entitled “$3.5 Trillion A Year: America’s Health Care System Has Become One Of The World’s Largest Money Making Scams”, our health care industry has become all about grabbing as much money as humanly possible. We are being taken advantage of when we are at our most vulnerable, and the level of greed that we see in the system is absolutely sickening.
As Dr. David Himmelstein has astutely observed, most Americans are “just one serious illness away from bankruptcy”…

Dr. David Himmelstein, the lead author of the study, a Distinguished Professor at the City University of New York’s (CUNY) Hunter College and Lecturer at Harvard Medical School commented: “Unless you’re Bill Gates, you’re just one serious illness away from bankruptcy. For middle-class Americans, health insurance offers little protection. Most of us have policies with so many loopholes, copayments and deductibles that illness can put you in the poorhouse. And even the best job-based health insurance often vanishes when prolonged illness causes job loss – just when families need it most.”

You may think that your health insurance policy is somehow different.
You may actually believe that your health insurance company will be there for you when you need them the most.
And they might be. But the truth is that hundreds of thousands of American families have discovered that most health insurance companies will turn on you the moment it becomes advantageous for them to do so.


More at: https://www.zerohedge.com/news/2019-...ew-study-finds

[Swordsmyth]

As we reported last week, a record 7 million Americans have fallen 90 days or more behind on their auto loan payments.
That’s 1 million more than the previous peak in auto loan delinquencies in 2010. But as Wolf Street points out, there is a big difference between then and now.
“Serious auto-loan delinquencies are now on par with Q2 2009 when millions of people had lost their jobs and when the economy was in free-fall. But today unemployment is low and the economy appears to be humming. What gives? “
Currently, there is about $1.3 trillion in auto loans outstanding. Looking at auto loan delinquencies in terms of a percentage of the total outstanding, the number hit 4.5% at the end of 2018. This is the same percentage as in the second quarter of 2009 as the economy was feeling the full effect of the 2008 crash.
Wolf Richter of Wolf Street highlighted some of the reasons for the surge in auto loan delinquencies in a recent episode of the Wolf Street Report.


In the first place, a lot of Americans are struggling with their jobs.
“While the unemployment rate is at around 4% and has been as low as 3.7%, there are many pockets of weakness in the labor market. A lot of people have gig work. A lot of people are underpaid. Their wages have not gone up with inflation. People have been discouraged and they’re not participating in the labor force anymore, and so they don’t show up in unemployment figures. So, there are many weaknesses in this labor market.”

Even so, Richter said it’s still the “cleanest dirty shirt of the labor market” we’ve had in a number of years, so the labor market itself cannot completely explain the surge in auto loan delinquencies.

A second issue is the rapidly rising cost of new cars. The average price of a new vehicle is now around $36,000. This represents a significant increase in the cost of vehicles and there has not been a corresponding rise in wages. Subprime borrowers face a double whammy. They not only have to pay the higher price; they also get hit with a higher interest rate.

More at: https://www.infowars.com/labor-marke...ith-inflation/

[Aratus]

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