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"The American Dream" a myth   [Copy link] 中文

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Post time 2012-6-12 08:38:58 |Display all floors
This post was edited by robert237 at 2012-6-11 16:55

Only the 1% are well off in America. The other 99% are just treading water if they are lucky.
If they aren't they sink.

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Family Net Worth Drops to Level of Early ’90s, Fed Says
New York TimesBy BINYAMIN APPELBAUM | New York Times – June 11, 2012

WASHINGTON — The recent financial crisis left the median American family in 2010 with no more wealth than they had in
the early 1990s, erasing almost two decades of accumulated prosperity, the Federal Reserve said Monday.

The median family, richer than half of the nation’s families and poorer than the other half, had a net worth of $77,300
in 2010, down from $126,400 in 2007, the Fed said. The crash of housing prices explained three-quarters of the loss.

This vast loss of wealth was compounded by a loss of income, as the earnings of the median family fell by 7.7 percent
over the same period.

[Related: Long-Term Unemployment Crisis Rolls On]

The new data come from the Fed’s much-anticipated release Monday of its triennial Survey of Consumer Finance, one of
the broadest and deepest sources of information about the financial health of American families. The latest survey is
based on data collected in 2010. Figures are reported in 2010 dollars.

Unsurprisingly, the report is full of grim news, and although it is news from 18 months ago, fresher sources of economic
data make clear that most households have since seen only modest increases, at best, in wealth and income.

Despite these setbacks, consumers have continued to spend surprising amounts of money in recent years, helping to keep
the economy growing at a modest pace. The survey underscores where the money is coming from: Americans are saving less
for future needs and making little progress in repaying debts.

The share of families saving anything over the previous year fell to 52 percent in 2010 from 56.4 percent in 2007. Other
government statistics show that total savings have increased since 2007, suggesting that a smaller group of families are
saving more money, while a growing number manage to save nothing.

The survey also found a shift in the reasons that families set aside money, illustrating the lack of confidence that is
weighing on the pace of economic growth. More families said they were saving as a precautionary measure, to make sure
they had sufficient liquidity to meet short-term needs. Fewer said they were saving for retirement, education or for a
down payment on a home.

[Related: In Era of Cheap Money, Consumers Are Shut Out]

And the report highlighted the fact that households have made limited progress in reducing the amount that they owe to
lenders. The share of households reporting any debt declined by 2.1 percentage points over the last three years, but
74.9 percent of households still owe something and the median amount of the debt did not change.

The drop in reported incomes could have increased the weight of those debts, requiring families to devote a larger share
of income to debt payments. But one of the rare benefits of the crisis, lower interest rates, has helped to offset that
effect. (Not really. See the post below this one. If you aren't the 1% in the USA you're screwed)
Families also have been able to reduce debt payments by refinancing into mortgages with longer terms and
deferring repayment of student loans.

The survey also confirmed that Americans are shifting the kinds of debts that they carry. The share of families with
credit card debt declined by 6.7 percentage points to 39.4 percent, and the median balance of that debt fell 16.1
percent to $2,600.

Families also reduced the number of credit cards that they carried, and 32 percent of families said they now had no
cards, up from 27 percent in 2007.

The cumulative statistics concealed large disparities in the impact of the crisis.

The losses of income and wealth fell most heavily on the middle class. Families with incomes in the bottom and top 20
percent of the population sustained smaller losses on a percentage basis than those families in the middle 60 percent.

One reason for this disproportion is that the middle class puts its wealth in housing, and the median amount of home
equity dropped to $75,000 in 2010 from $110,000 in 2007. And while other investments have recovered much of the value
lost in the depths of the crisis, housing prices have hardly budged.
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Post time 2012-6-12 08:52:45 |Display all floors
In the USA only the fat cats can make money. Ordinary citizens are helpless pawns.
Don't let anyone fool you. Capitalism is only good for the obscenely rich.
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In Era of Cheap Money, Consumers Are Shut Out
New York TimesBy NATHANIEL POPPER and TARA SIEGEL BERNARD | New York Times – Sat, Jun 9, 2012 9:16 PM EDT

Michael Shreve, a 57-year-old science teacher in Marysville, Wash., has watched helplessly as mortgage rates have fallen.
He said that despite his stellar credit score, no bank had been willing to let him trade in his 6.35 percent 30-year
mortgage because his house was now worth less than when he bought it.

“At some point,” he said, interest rates are going to go up again, “and I should have been able to get those low rates.
It’s not fair.”

As interest rates have been dropping to new lows seemingly by the week, American companies have been taking advantage
of the cheap borrowing costs, but consumers have been largely left on the sidelines.

New data this week from the Federal Reserve shows that in the first quarter of this year, American businesses were
taking on new debt at the fastest rate since the financial crisis in 2008. American households, though, were heading
in the opposite direction, increasingly shedding debt.

And as in the case of Mr. Shreve, the lack of borrowing by American families was not always by choice. Another recent
Fed report shows that while more consumers are interested in buying homes or refinancing existing mortgages, banks
remain hesitant to extend credit to them.

Consumers are also getting squeezed on the investing front. Wary of the volatile financial markets and worried about
the continued weakness in the economy, they have been putting more money into ordinary savings accounts, the new data
shows. But those accounts are paying an average of 0.1 percent, according to Bankrate.com.

“There’s definitely winners and losers in this kind of extremely low interest rate environment,” said Ed Yardeni, the
president of Yardeni Research. “In this case, any borrower that has access to the capital markets and doesn’t have to
fill out a loan application at a bank is definitely going to have a tremendous advantage.”
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In this case "any borrower that has access to the capital markets and doesn’t have to fill out a loan application"
is double talk for the rich fat cats. the 1%

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Post time 2012-6-12 09:40:55 |Display all floors
TheHermit Post time: 2012-6-12 06:01
OK clever dick! Explain this to me.

If W is all the money being paid as wages for goods produced  ...

You may be the only one in the world who tried to explain economic theory in two sentences.

Your professor will mark your paper as fail.............
I've made my living, Mr. Thompson, in large part as a gambler. Some days I make twenty bets, some days I make none. There are weeks, sometimes months, in fact, when I don't make any bet at all because ...

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Post time 2012-6-12 10:15:40 |Display all floors
Revolutionar Post time: 2012-6-12 09:40
You may be the only one in the world who tried to explain economic theory in two sentences.

Your  ...

They only try to make it complicated so that they can deceive the majority of people. At the end of the day the corporations can only get back what they pay out for materials, wages, and taxes.

In the old days one pool of capital competed against another with the public acting as the transfer mechanism. The loss of one corporation was the gain of another, but in the western world that is not usually the case anymore. Corporations collude to shaft the consumer.

So tell me professor. Is it possible for one super-corporation to own everything in the world and still operate on a loss and profit basis? Because this is what the world has come to more or less.
The world needs more idiots like me, all the others think they are clever.

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Post time 2012-6-12 10:39:08 |Display all floors
Revolutionar Post time: 2012-6-11 22:16
if you think China is in anyway better................if you think China is heading into a more eq ...

China has its share of problems with its new power of economic wealth.
I do not think it is as "deep rooted" as in the States.

I hope China is watching closely to avoid the same problems

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Post time 2012-6-12 11:11:45 |Display all floors
Revolutionar Post time: 2012-6-11 17:40
You may be the only one in the world who tried to explain economic theory in two sentences.

Your  ...

Your economic theory can be explained in just one sentence.
Let the rich keep raping the poor.

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Post time 2012-6-12 11:37:34 |Display all floors
robert237 Post time: 2012-6-12 11:11
Your economic theory can be explained in just one sentence.
Let the rich keep raping the poor.

China's economic theory is even simpler....................


Queen bees are always right.
I've made my living, Mr. Thompson, in large part as a gambler. Some days I make twenty bets, some days I make none. There are weeks, sometimes months, in fact, when I don't make any bet at all because ...

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