The glowing economic reports are blowing away the middle class. Amid rough retail reports you can still find some gems. Tiffany the luxury jeweler profit rose as sales went up 20% to $ 662.6 million. Other lower end retailer’s sales fell across the board. The struggling middle class are feeling the pinch. The uncertain housing market is causing a lot of the financial woes. A snapshot of the landscape, with the entire home for sale signs would give you a picture of the slowdown.
The middle class is surely being kicked while down. The alluring home market has fallen flat for the struggling middle class. The number of Americans without health insurance has risen by 2.2 million. There are a total of 47 million people without this insurance. The poor are still poor and the middle class is struggling to stay middle class. The claim is other sections of the economy are healthy.
Then who and what are the reports referring to? Before 1990 the Forbes 400 had a combined worth of $221 billion combined. By June 2006 they were worth 1.3 trillion. The median household income has held at about $ 44,000. What this means is if the lower to middle class incomes are stagnate while inflation is rising, the healthy economy exists for the rich. There are many ways to make the national economy appear healthy than it is for the average working class family.
Adjusted for inflation the federal minimum wage has fallen 42% in June 2006 since its peak. It is said that 80% of American spend more on health care than entertainment. Partly this is due to the high cost of prescription drugs. The second part is that the number of prescriptions written is higher than ever. The U.S. economy is partly built on the pharmaceutical and food conglomerates. Think about it you have to eat so there is always a market for what the food industry produces. Than again after you indulge in the processed faux food you wind up in the arms of the pharmaceutical giants.
In other words the big players on the top rungs are where we find the health economy. The U.S. economy is supported by the working class. From taxes to buying habits the happy reports about the U.S. economy are fueled by the feeding of the corporate giants. The top is getting heavy and the bottom half is loosing its footing. If the U.S. economy sinks the middle class, it will echo thought the whole economy.
The opportunities for wealth still exist in this economy. The problem is that the industrial giants are in the position of expanding their reach at the cost of the general population. Basically, what the prevailing thought is that the rich spend and keep the money in circulation. Their buying power and consumer spending feed the economy. The question is whose economy. Sure Tiffany is enjoying good sales growth, but what about the mom and pop stores selling lower end merchandise.
When doing an overview of the economy you have to look at the landscape. When listening to the reports on the economy you have to ask where Middle America is. Then you can get an idea if the ship will stay afloat, and I think the answer will not surprise you. Middle America is not being buffered by the high rollers. If anything it is being sunk by the people who claim to be holding the economy together.