Freedom World News

This Is One Of The Big Reasons Why So Many Families Are Feeling Extreme Financial Stress

This Is One Of The Big Reasons Why So Many Families Are Feeling Extreme Financial Stress

This Is One Of The Big Reasons Why So Many Families Are Feeling Extreme Financial Stress
February 22
02:51 2017

This Is One Of The Big Reasons Why So Many Families Are Feeling Extreme Financial Stress

 

By Michael Snyder, on February 15th, 2017

When the cost of living rises faster than paychecks do year after year, eventually that becomes a very big problem.  For quite some time I have been writing about the shrinking middle class, and one of the biggest culprits is inflation.  Every month, tens of millions of American families struggle to pay the bills, and most of them don’t even understand the economic forces that are putting so much pressure on them.  The United States never had a persistent, ongoing problem with inflation until the debt-based Federal Reserve system was introduced in 1913.  Since that time, we have had non-stop inflation and the U.S. dollar has lost more than 98 percent of its value.  If our paychecks were increasing faster than inflation this wouldn’t be a problem, but in recent years this has definitely not been the case for most Americans.

And unfortunately inflation is starting to accelerate once again.  In fact, it is being reported that inflation rose at the fastest pace in four years in January…

The prices Americans pay for goods and services surged in January by the largest amount in four years, mostly reflecting a rebound in the cost of gasoline that’s taking a bigger chunk out of household incomes.

The consumer price index, or cost of living, rose by a seasonally adjusted 0.6% in January, the government said Wednesday.

Meanwhile, our incomes have been incredibly stagnant.   In fact, we just learned that median household income did not go up at all during 2016.

This is one of the reasons why we consistently see families fall out of the middle class month after month.  Even if you keep the same job year after year, your standard of living is going to steadily go down unless your pay goes up.

The things that we all spend money on month after month just keep going up in price.  I am talking about food, housing, medical care and other essentials.  If there is one thing that we can always count on, it is the fact that things are going to cost more tomorrow than they do today.

Let’s talk about food for a moment.  Whenever I go to the grocery store, I am almost always shocked.  I still remember a time when I could get everything that I needed for an entire week for about 20 bucks, but these days you can’t even fill up one cart for 100 dollars.

That is because food prices have been rising aggressively for many years.  The following is a list that was posted on The Economic Policy Journal that shows how much some food and grocery items have increased over the past decade…

  1. Tobacco and smoking products

-Price increase: 90.4%

  1. Margarine

-Price increase: 63.6%

  1. Uncooked ground beef

-Price increase: 46.3%

  1. Shelf stable fish and seafood

-Price increase: 45.0%

  1. Prescription drugs

-Price increase: 43.5%

  1. Rice, pasta, cornmeal

-Price increase: 40.3%

  1. Bread

-Price increase: 38.9%

  1. Snacks

-Price increase: 38.4%

  1. Miscellaneous poultry including turkey

-Price increase: 37.0%

  1. Apples

-Price increase: 36.6%

  1. Frankfurters

-Price increase: 35.8%

  1. Canned vegetables

-Price increase: 35.3%

  1. Salt and other seasonings and spices

-Price increase: 34.0%

  1. Miscellaneous fats and oils including peanut butter

-Price increase: 34.0%

  1. Miscellaneous processed fruits and vegetables including dried

-Price increase: 33.7%

  1. Bacon and related products

-Price increase: 33.2%

  1. Fresh whole chicken

-Price increase: 32.5%

  1. Cakes, cupcakes, and cookies

-Price increase: 32.1%

  1. Flour and prepared flour mixes

-Price increase: 32.1%

  1. Canned fruits

-Price increase: 32.0%

And thanks to out of control government spending and reckless manipulation by the Federal Reserve, we have come to a time when inflation is starting to accelerate once again.

According to John Williams of shadowstats.com, if honest numbers were being used the government would be telling us that inflation is rising at a 6 percent annual rate for the first time since 2011.

At the same time, evidence is mounting that U.S. consumers are simply tapped out.  Previously, I have explained that interest rates are going up, consumer bankruptcies are rising, and lending standards for consumers are really tightening up.

All of those are things we would expect to see if a new recession was starting.

And today we learned that the number of Americans refinancing their homes has fallen to the lowest level that we have seen since 2009…

A slowdown in refinancing pulled down the total mortgage application volume last week as changes to certain government-loan programs made refinances less lucrative. Refinance volume now stands at its lowest level since June 2009.

If you will remember, we also saw a slowdown in mortgage refinancing just before the great financial crisis of 2008.

For mortgage applications overall, they are now down almost 31 percent from where they were a year ago…

Total mortgage application volume fell 3.7 percent on a seasonally adjusted basis last week from the previous week, and are nearly 31 percent lower than the same week a year ago, according to the Mortgage Bankers Association.

A 31 percent decline in a single year is catastrophic.

If this continues, it won’t be too long before everyone is talking about a new housing crash.

Read More

Related Articles

0 Comments

No Comments Yet!

There are no comments at the moment, do you want to add one?

Write a comment

Write a Comment