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Trump's Economy
Topic Started: Jun 17 2018, 08:13 AM (61 Views)
Brewster
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CBS News
 
Why the robust economy doesn't reflect the reality for many Americans
"The economy," Federal Reserve Chairman Jerome Powell declared this week, "is doing very well." And it is.

Steady hiring has shrunk unemployment to 3.8 percent -- the lowest since the 1960's. Consumers are spending. Taxes are down. Inflation is tame. Factories are busy. Demand for homes is strong. Household wealth is up.

Yet the numbers that collectively sketch a picture of a vibrant economy don't reflect reality for a range of Americans who still feel far from financially secure even nine years into an economic expansion. From drivers paying more for gas and families bearing heavier child care costs to workers still awaiting decent pay raises and couples struggling to afford a home, people throughout the economy are straining to succeed despite the economy's gains.

They are people like Katy Cole, a 33 year-old music teacher from North Creek, New York, who's still repaying her student loans. It took her two years of working a second job to repair her credit and amass enough money to try to buy a home with her boyfriend. She just gave birth last month -- the fourth child in her blended family -- which means having to take unpaid leave from her school job. "As far as the numbers saying everyone is working, that's great," Cole said. "But is everybody surviving? I don't think so. In a great economy, everybody is thriving -- and not just a certain group."

When analysts at Oxford Economics recently studied American spending patterns, they found that the bottom 60 percent of earners was essentially drawing on their savings just to maintain their lifestyles. Their incomes weren't enough to cover expenses.

Here's a look at the economy from their perspectives:

Commuters

Even with inflation running at a relatively low 2.4 percent, one particular expense is weighing on anyone idling in traffic: Gasoline prices have surged 24 percent over the past year to a national average of $2.94 a gallon, according to AAA. That's the highest average since 2014.

Analysts at Morgan Stanley have estimated that the increase this year will likely eat away a third of people's savings from President Trump's tax cuts. Gas prices are still below their high reached roughly a decade ago. Yet the increase this year represents an additional financial burden on consumers and businesses compared with a year ago.

Homebuyers

A strong job market can actually be a curse for would-be homebuyers. With more people drawing paychecks and able to afford a home, demand has intensified. Yet the number of homes listed for sale is flirting with historic lows. The combination of high demand and low supply has driven prices to troubling high levels.

It's not just that home ownership is largely unobtainable in San Francisco or Seattle. The Case-Shiller index shows that home prices are rising more than 6 percent annually in Atlanta and Minneapolis. In the Detroit metro area, they're up nearly 8 percent over the past 12 months. By contrast, average hourly wages have risen just 2.7 percent over the past year.

On top of that, 30-year fixed-rate mortgages are growing costlier. The average interest rate on these mortgages has jumped to 4.62 percent -- from 3.95 percent at the start of the year -- according to mortgage buyer Freddie Mac.

The middle class

$100 trillion. That's roughly the net worth of U.S. households and nonprofits, according to the Federal Reserve. The problem is, America's wealth is increasingly lopsided, with the affluent and the ultra-wealthy amassing rising proportions and everyone else benefiting modestly if at all.

The top 10 percent of the country holds 73 percent of its wealth, a share that has crept steadily up since 1986, according to the World Inequality Database. The most sweeping gains are concentrated among the top 1 percent; this group holds nearly 39 percent of the wealth. And they're arguably poised to become even more prosperous because Trump's tax cuts largely favored the wealthiest slice of individual taxpayers.

Contrast that with the middle 40 percent of the country, a group that would historically be considered middle class. In 1986, they held 36 percent of the country's wealth; now, it's just 27 percent.

Worse off is the bottom 40 percent of Americans: They have a negative net worth and almost no financial cushion in case of an emergency.

High school-only grads

Employers increasingly favor college graduates over people with only a high school diploma. Out of the 2.6 million jobs added in the past year, the government's job data shows that 70 percent of them went to college graduates. Workers who have graduated only from high school made up less than 1 percent of the job gains.

College grads

For all their good fortune as the favored recipients of job growth, there's a major downside for recent college graduates. The price of a four-year degree has marched steadily upward for decades.

Today, more than 80 percent of families fill out an application for financial aid, up from less than three-quarters a decade ago. A large majority of families and students aren't even considering colleges because they're too expensive. This year, 69 percent of respondents eliminated schools from their college search based on price, up from 58 percent who did so in 2008.

Obtaining a degree has increasingly coincided with ever-higher student debt loads. Since 2004, total student debt has climbed 540 percent to $1.4 trillion, according to the New York Federal Reserve.

Mounting student debt could hinder the buying of homes and formation of families that helped growth in previous decades. A survey last year by the National Association of Realtors found that student debt was delaying home ownership by seven years among millennials

Anyone paying for child care

Children are immensely expensive. For nearly a third of families, the costs of child care swallowed at least 20 percent of their income, according to a survey posted in March by the caregiver jobs site Care.com. Nearly a third of parents said they went into debt to cover child care expenses.

Research also suggests that some women remain outside the workforce because of the comparatively weak family leave and child care policies in the United States relative to those in other developed economies. A result is that families are forgoing income that would otherwise benefit them and the economy.

When the unemployment rate was last around 3.8 percent in 2000, the proportion of women who either had a job or were looking for one was peaking. For women ages 25 to 54, that proportion - called the labor force participation rate - was roughly 77 percent in 2000. It's now 74.8 percent.
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Berton
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LWEC toot

doglaugh doglaugh doglaugh doglaugh doglaugh
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Brewster
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Where did they echo it from, Berton?
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Berton
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They are part of the LWEC Brewster. Even a child knows that.

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Stoned
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Berton
Jun 17 2018, 09:36 PM
They are part of the LWEC Brewster. Even a child knows that.

Gee Bert I thought you were older. Explains a lot.
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icy-woman
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On the home ownership side of things. First of all, people can't truly own their own home in the USA. That being a house on a lot/land, or even the land alone. Property taxes, unlike a one time sales tax on any given item, is ongoing. Stop paying it and even if you rightfully own the home, paid in cash ect. they can take your home away.

There is no end in sight concerning property tax, pay it for 10 years, 20 years, 40 years, 80 years. Pass the place onto your children and they are stuck with the tax for as long as they have the place, then their children, on and on. Looks alot to me like a ransom, extortion. Also every so often they pass a school levy and the amount of property tax goes up, build onto or make improvements to your place and the value goes up driving the property tax up.

There's a pattern here, hard work, investment, hard times, unable to pay and it's all taken away. It would be one thing if there was an end in sight, like say, buy a house and pay the taxes on the place for a number of years before you own your home long enough to be exempt. But there is no such relief.

But taxes is only one of many things or reasons one can never own a home in the USA. If someone in power don't like they way you mow your yard, or keep the place up, they can use Blue ISIS terrorists to take it all away. Or even if they just take issue with you, they can take the place for no reason and there's really nothing one can do.

Your loving cops are the number one reason many people can't live a good decent life in the US.
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Thumper
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Brew, what do you hope to gain with this post and to whom is it directed?
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Pat
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Brewster
Jun 17 2018, 08:13 AM
CBS News
 
Why the robust economy doesn't reflect the reality for many Americans
"The economy," Federal Reserve Chairman Jerome Powell declared this week, "is doing very well." And it is.

Steady hiring has shrunk unemployment to 3.8 percent -- the lowest since the 1960's. Consumers are spending. Taxes are down. Inflation is tame. Factories are busy. Demand for homes is strong. Household wealth is up.

Yet the numbers that collectively sketch a picture of a vibrant economy don't reflect reality for a range of Americans who still feel far from financially secure even nine years into an economic expansion. From drivers paying more for gas and families bearing heavier child care costs to workers still awaiting decent pay raises and couples struggling to afford a home, people throughout the economy are straining to succeed despite the economy's gains.

They are people like Katy Cole, a 33 year-old music teacher from North Creek, New York, who's still repaying her student loans. It took her two years of working a second job to repair her credit and amass enough money to try to buy a home with her boyfriend. She just gave birth last month -- the fourth child in her blended family -- which means having to take unpaid leave from her school job. "As far as the numbers saying everyone is working, that's great," Cole said. "But is everybody surviving? I don't think so. In a great economy, everybody is thriving -- and not just a certain group."

When analysts at Oxford Economics recently studied American spending patterns, they found that the bottom 60 percent of earners was essentially drawing on their savings just to maintain their lifestyles. Their incomes weren't enough to cover expenses.

Here's a look at the economy from their perspectives:

Commuters

Even with inflation running at a relatively low 2.4 percent, one particular expense is weighing on anyone idling in traffic: Gasoline prices have surged 24 percent over the past year to a national average of $2.94 a gallon, according to AAA. That's the highest average since 2014.

Analysts at Morgan Stanley have estimated that the increase this year will likely eat away a third of people's savings from President Trump's tax cuts. Gas prices are still below their high reached roughly a decade ago. Yet the increase this year represents an additional financial burden on consumers and businesses compared with a year ago.

Homebuyers

A strong job market can actually be a curse for would-be homebuyers. With more people drawing paychecks and able to afford a home, demand has intensified. Yet the number of homes listed for sale is flirting with historic lows. The combination of high demand and low supply has driven prices to troubling high levels.

It's not just that home ownership is largely unobtainable in San Francisco or Seattle. The Case-Shiller index shows that home prices are rising more than 6 percent annually in Atlanta and Minneapolis. In the Detroit metro area, they're up nearly 8 percent over the past 12 months. By contrast, average hourly wages have risen just 2.7 percent over the past year.

On top of that, 30-year fixed-rate mortgages are growing costlier. The average interest rate on these mortgages has jumped to 4.62 percent -- from 3.95 percent at the start of the year -- according to mortgage buyer Freddie Mac.

The middle class

$100 trillion. That's roughly the net worth of U.S. households and nonprofits, according to the Federal Reserve. The problem is, America's wealth is increasingly lopsided, with the affluent and the ultra-wealthy amassing rising proportions and everyone else benefiting modestly if at all.

The top 10 percent of the country holds 73 percent of its wealth, a share that has crept steadily up since 1986, according to the World Inequality Database. The most sweeping gains are concentrated among the top 1 percent; this group holds nearly 39 percent of the wealth. And they're arguably poised to become even more prosperous because Trump's tax cuts largely favored the wealthiest slice of individual taxpayers.

Contrast that with the middle 40 percent of the country, a group that would historically be considered middle class. In 1986, they held 36 percent of the country's wealth; now, it's just 27 percent.

Worse off is the bottom 40 percent of Americans: They have a negative net worth and almost no financial cushion in case of an emergency.

High school-only grads

Employers increasingly favor college graduates over people with only a high school diploma. Out of the 2.6 million jobs added in the past year, the government's job data shows that 70 percent of them went to college graduates. Workers who have graduated only from high school made up less than 1 percent of the job gains.

College grads

For all their good fortune as the favored recipients of job growth, there's a major downside for recent college graduates. The price of a four-year degree has marched steadily upward for decades.

Today, more than 80 percent of families fill out an application for financial aid, up from less than three-quarters a decade ago. A large majority of families and students aren't even considering colleges because they're too expensive. This year, 69 percent of respondents eliminated schools from their college search based on price, up from 58 percent who did so in 2008.

Obtaining a degree has increasingly coincided with ever-higher student debt loads. Since 2004, total student debt has climbed 540 percent to $1.4 trillion, according to the New York Federal Reserve.

Mounting student debt could hinder the buying of homes and formation of families that helped growth in previous decades. A survey last year by the National Association of Realtors found that student debt was delaying home ownership by seven years among millennials

Anyone paying for child care

Children are immensely expensive. For nearly a third of families, the costs of child care swallowed at least 20 percent of their income, according to a survey posted in March by the caregiver jobs site Care.com. Nearly a third of parents said they went into debt to cover child care expenses.

Research also suggests that some women remain outside the workforce because of the comparatively weak family leave and child care policies in the United States relative to those in other developed economies. A result is that families are forgoing income that would otherwise benefit them and the economy.

When the unemployment rate was last around 3.8 percent in 2000, the proportion of women who either had a job or were looking for one was peaking. For women ages 25 to 54, that proportion - called the labor force participation rate - was roughly 77 percent in 2000. It's now 74.8 percent.
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The definition of an irresponsible person in any culture or country.

Quote: They are people like Katy Cole, a 33 year-old music teacher from North Creek, New York, who's still repaying her student loans. It took her two years of working a second job to repair her credit and amass enough money to try to buy a home with her boyfriend. She just gave birth last month -- the fourth child in her blended family -- which means having to take unpaid leave from her school job. "As far as the numbers saying everyone is working, that's great," Cole said. "But is everybody surviving? I don't think so. In a great economy, everybody is thriving -- and not just a certain group."

An unmarried young woman who wasted money on an education in a field that is known for low wages. And she buys a home with her meager earnings which means she will most likely be one of the first to default and lose the home once the bubble bursts in another cycle.And she got herself knocked up to boot.

America is booming but there will always be those who for one reason or another, one bad decision or a series of bad decisions in life, are on the outside looking in. We're doing better than ever, how about your family. Yet every family has the losers in it.

Reading garbage like that article would have you believe that the booming, number one economy in the world that is doing better than anytime in recent decades, is failing. Bullsh**. Why not be truthful, there have always been deadbeats and losers in good times and bad.
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