I have been a financial consultant for about 25 years so have seen lots of balance sheets of family households for lots of years....and I can testify that Americans are raiding their savings and many young folks have totally raided some, or all, of their retirement accounts...just to keep the bills paid.
This is not a good sign.
NEW YORK — More than four years after the United States fell into recession, many Americans have resorted to raiding their savings to get them through the stop-start economic recovery.
In an ominous sign for America's economic growth prospects, workers are paring back contributions to college funds and growing numbers are borrowing from their retirement accounts.
Some policymakers worry that a recent spike in credit card usage could mean that people, many of whom are struggling on incomes that have lagged inflation, are taking out new debt just to meet the costs of day-to-day living.
American households "have been spending recently in a way that did not seem in line with income growth. So somehow they've been doing that through perhaps additional credit card usage," Chicago Federal Reserve President Charles Evans said on Friday.
"If they saw future income and employment increasing strongly then that would be reasonable. But I don't see that. So I've been puzzled by this," he said.
Here; http://www.msnbc.msn.com/id/46025535/ns/business-stocks_and_economy/
There is nothing to be puzzled about, Mr. Federal Reserve President....you are simply seeing the reality that I have been watching for 4 years now...mainly that people are cashing in their financial futures simply to keep their heads above water today.
So yes....as the article correctly states, this is an "ominous sign for America's economic growth prospects."
No wonder that Bible warns us so much about the love of money and the dangers of materialism.
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