Caught an interesting glimpse of a TV program over the weekend where someone questioned why the modern two-income household doesn't equal the buying power / standard of living of the single-income household of the 1950s-60s. D'oh! I've gone over this before. It's so simple.
Change began when silver certificates were no longer issued and silver was no longer used to make our dimes, quarters, half-dollars and "silver dollars." That was 1965-ish.
Next, the bra-burning women-libbers who demanded equality. They got it, but for a price. Housewives suddenly needed to get part tim jobs. Then others began to work full-time. The greedy got wind of this and figured it out: make things more expensive... which led to the need for two people to work instead of one.
Then somebody else came up with the ideas of health-insurance and HMO, and once that got out of control, it was only a matter of time before the "American dream" of owning a home became the target of the greedy... which led to the subprime mortagages and the eventual collapse of the economy. I know that's a bit of a nutshellish stretch, but it pretty well sums it up. The more you make, the more they take. In doing a bit of reading, I found that American households in the mid-50s to mid-60s enjoyed an awesome standard of living. America so beautiful, so bountiful.
Just imagine: back then folks lived in modest but clean houses. Dad worked. Mom was always home. Food, gas and medical care was cheap (no health insurance needed)... Homes actually sold at prices people could easily afford. The majority of credit was a) the mortgage and b) the car loan... and maybe $5 a month for the living room furniture or the TV set. What happened?
The greedy among us took advantage of CHANGE: they were there when the silver was taken out of the money, when the women's libbers were promoting their cause, when somebody thought health insurance might be a good idea... They were there in 1995 to make sure General Motors' electric car project would be killed. That little car could singlehandedly have averted the US economic collapse! (Government thought WAR in Iraq would help the economy. Didn't happen, did it?) If Barack Obama had a time machine, and he went back to save the electric car, GM stock would probably be in the Google range of $300 a share, and I think General Electric would also be doing quite well. But of course, (as I have said time and time again) this is what General Motors WANTED all along: to gouge the consumer by selling HUMMERS and essential auto supplies like OIL and GAS.
Would the home mortgage crisis still have happened? I think so, because although the chain of events leading up to that were also greed-based, they were coming from a different direction. So, this is what happens when there is nothing more to be exploited. Things hit bottom. It isn't exactly the same as what happened in the original Wall Street collpase and ensuing Great Depression, but the "experts" and "observers" are trying hard to make us believe it is...
Speaking of GM, the automaker may be granted an extension of a Tuesday deadline to gain concessions from its main union and bondholders,demanded as part of a U.S.-aided restructuring.
On Thursday, world economic leaders are to meet outside London as the Europena Union is expected to pursue stricter global financial recognition.
On Friday, The U.S. Bureau of Labor Statistics reports on the employment situation for the month of March.
By the way, the abovementioned "experts" and "observers" are now speculating that the economy has already bottomed out. Keep an eye on a few things:
1) Wall Street - let's see how the market fares on Tuesday, Thursday and especially Friday. If you are BUYING stocks, this could be a good week to grab shares of your targeted companies.
2) Home Sales - although no particular news is expected this week, it should be interesting to see if any media outlets release stories about the real estate market - good or bad!
3) Prices of Oil and Gasoline - isn't it funny how once gas got down around $2 a gallon we haven't been talking much about it? Yet it has had some long-term effects. My neighbor had his eye on a certain brand of car for awhile and was jsut about ready to buy when gas went up near $4 a galon. OK - it's back to "normal" now and they're practically GIVING AWAY the model he was interested in. No kidding - before it sold for $22,000 and right now he can get one for $14,500. I asked him about it. He's watching the gas prices s-l-o-w-l-y rise. He's not even tried to get a car loan. He (like many others) is sitting on his hands.
Are we, as a nation, on "pause" when it comes to something like this? I think we are.
Another interesting thing to watch: in Albany, and New York City, the cost of public transportation is about to rise. A 5-day workweek bus pass in Albany going from $36 to about $55 dollars. That's a big jump. Nice weather is on the way. Will this reverse the flock to public transportation?
So many factors at play! And did I mention most people who ARE in need of new cars aren't even visiting showrooms because they have HEARD that "even customers with good credit are not being given loans" - so, why bother?
The plot is thickening. Can anybody guess what might happen next? And we haven't even considered anything like a natural disaster or a terrorist attack or a sudden price spike or financial catastrophe in some area we haven't considered...