Taking Back America!
According to a report from the Federal Reserve it has! The Fed's 'Bulletin' titled, Changes in U.S. Family Finances from 2007 to 2010: Evidence from th... states that family median net wealth decreased nearly a whopping 40% from 2007 to 2010! The bulletin also states that there was a decline in the years prior to 2007 as well.
From the Washington Post:
The data represent one of the most detailed looks at how the economic downturn altered the landscape of family finance. Over a span of three years, Americans watched progress that took almost a generation to accumulate evaporate. The promise of retirement built on the inevitable rise of the stock market proved illusory for most. Homeownership, once heralded as a pathway to wealth, became an albatross.
The findings underscore the depth of the wounds of the financial crisis and how far many families remain from healing. If the recession set Americans back 20 years, economists say, the road forward is sure to be a long one. And so far, the country has seen only a halting recovery.
“It’s hard to overstate how serious the collapse in the economy was,” said Mark Zandi, chief economist for Moody’s Analytics. “We were in free fall.”
The recession caused the greatest upheaval among the middle class. Only roughly half of middle-class Americans remained on the same economic rung during the downturn, the Fed found.
So clearly the American Dream of each generation doing better than the one before it is dead, at least for now. Why? While the report is full of data trying to explain this depressing result it is clear to us that government is taking too much from the private sector economy and regulating it to death. When people are not free to create and produce then the economy has nowhere to go but down. Like Reagan said, "Government is not the solution to our problems, Government is the problem!"
Have any of you ever tried to start a small business? Do you own a small business? Every year it gets harder and harder to accomplish. Sure, the liberal/socialists will tell you the economic downturn happened because of Wall Street but that is simply not true. This decline has been 'in the works' for years and years as Government puts more and more restrictions on what businesses can and can't do as well as increasing taxes and reporting requirements. There are many examples of entrepreneurs who started great companies 30 years ago that say they probably could not pull it off in today's environment.
The answer is simple! Cut taxes on businesses and massively cut regulations. Don't just stop the 'growth' of regulations, get rid of them! Businesses should not pay any taxes anyway. If you really think about it taxing a business is the stupidest thing in the world as it kills expansion and hiring. People pay taxes, not businesses. Every penny that is taxed from a business takes it away from expanding that business and/or hiring new employees. Of course, if you are a socialist that is exactly what you want though. You want government controlling all the money and deciding the fate of the economy instead of FREE people. Ask yourself this question, "Who will do a better job controlling your money, you or the government?"
Our economy could literally be turned around overnight if the politicians would set the American business sector free. It won't happen though. American is on a slow path to socialism. Politicians want to pander to people who want 'free stuff' from the Government instead of doing what is right that would help EVERYONE. And the sad truth is that about half the population of the United States probably wants a socialist type system.
But there is still hope. Scott Walker's victory proved that! We just have to keep fighting to preserve the American Dream.
Of course the fed. is always right :) and I suppose it has gone down significantly for the majority, those especially that own or are buying a home. Doesn't take the fed to tell me that. However, I've always been an independant thinker when it comes to my money and diversification (not always looking for the highest payback on an investment) and protecting your wealth from both ends, should be the lesson to the American school kid so they have a better understanding of how to build wealth when they get into the working force. Not bragging, and taking into consideration my home value dropping some 35% since I bought it, my total net worth has gone up due to proper diversification and I can thank my long gone parents, uncles and aunts for teaching me how to handle money, look after it and invest it. One thing about investing, you "can't" win with a profit "every time" and have to accept the losses and use it as a learning step not to do the same thing again.
Young people are taught that spending and consuming are the norm and proper behavior. There are differences between people who have money and people who don't. People who have money tend to invest and then spend what is left all the while thinking about how to protect and grow their money. People who don't have money like to be entertained and consume which means spending.
Mentality today is bass ackwards in regard to financial planning for one's future. Instead of an "earn and save" it's now "borrow and spend" with the attitude of dumping debt back onto the banks and untimately onto the taxpayer. Classic example of this right here in my city where I am a real estate appraiser: Mr. and Mrs. X built a 7k plus sq. ft. house in a upscale subdivision in 2005 at that time valued approx. 1.8M. They still live there and it has gone to foreclosure recently. I did an appraisal on it for the bank/investor for their information of current value which has dropped by more than 50%. They bought it with 5% down in 05. They have been currently living there for 12 months, making NO payment. When I contacted the listing agent for access she told me that I could not get in until a specific later date because the owners were on a 2 week vacation in Europe. ??????? When I did see the house, there were 3 very new vehicles there, Lexus, Cad. SUV, BMW in the garages. When they finally get the eviction from the bank, along with it they will get a "check" for $3k to cover their inconvenience to move out. WHAT'S WRONG WITH THIS PICTURE????? This is "times" millions of other home owners doing the same thing. It's been called "strategic foreclosure". So, now that the bank has taken a $700K loss on this property, they will get there money back from gov. programs that guarantee the loan. Who's on the hook for the debt??? I think it can easily be figured out.