I have been reading the Daily Reckoning once again and doing some cut and paste quotes for my blog. I enjoy the writing style of these guys but I’m always disappointed by the typo’s I find in their material. There really is no excuse for typos anymore. Not with spell checking available for just about every application. Whenever I find a typo in a commercial publication I automatically think less of the sender. How professional can they be when mistakes like that are published? Why would I want to do business with them? You don’t have to tell me…I know it’s slightly neurotic on my part. Slightly? OK, very neurotic!
Here is what I read this morning, “When Alan Greenspan started his policy of easy money, Americans got poorer - not richer. Since he became head of the Federal Reserve, personal debt levels rose from $28,892 for the average family in 1987 to $101,386 in 2005 - a jump of 250.9%.”
That’s scary! Why? Because it’s not just one unique indebted idiot that we can safely ignore, it’s the average! And that effects us all. (Affect or effect? Has to be effect…stupid Spell Check!)
“In a desperate move to slow it down, the Federal Reserve has raised short-term interest rates 12 times since June 2004.”
“Unfortunately, many people have no safety net. In September 2004, the personal savings rate among Americans was just 0.2%. In China, it's 25%. And for every $19 an American earns, he spends $20.” Hello? Anyone home?
And speaking of homes…“Americans even buy homes they cannot afford. By mid-2005, nearly 50% of homes were purchased with interest-only mortgages - compared to 5% in 2001. And personal bankruptcies have doubled in the last decade. Roughly 43% of American families spend more than they earn each year - meaning that the average household carries some $8,000 in credit card debt that is nearly impossible to pay off.”
“But the American workingman cannot believe it. He put his wife to work years ago...” That’s right, as soon as the voodoo economics that Reagan espoused, failed, everyone had to go to work. The trickledown effect never worked and never will...
ReplyDelete“Then, under the easy money/big spending policies of the Bush/Greenspan team, he sold off his house...a room at a time. Roach estimates that U.S. householders "took out" as much as $600 billion from their houses in mortgage debt last year. It was more than enough to offset the $335 billion they should have earned. But it was a different kind of money; they have to pay it back. With falling incomes, how will the U.S. wage earner be able? And how will the nation squeeze enough money out of these poor working stiffs to pay its trillion dollar debts overseas, let alone make good on its promises to its own people?”