Posted on 09/23/2015 9:50:50 AM PDT by blam
Harry_Dent
September 23, 2015
It’s not enough that jobs are less stable, or that the ones we’re adding are increasingly more part-time…
It’s not enough that rapidly growing student loan costs are plaguing more young echo boomers and millennials…
It’s not enough that the high costs of education are increasing the inequality gap and making upward mobility impossible…
Or that, even after the last crash, housing is still expensive and loans are harder to get…
Today, the young generation ALSO has to deal with runaway childcare costs. It’s no wonder many of them aren’t having kids!
But I believe much of this will change in the great deleveraging we see ahead. When this bubble bursts, it will bring many of our “inflated” economic realities – in this case, the ones that affect the majority of our consumer population – to center stage.
This is something important to remember. When it comes to education, health care, even child care to an extent – they’re all service industries. But these service industries rely on higher-than-average skills. They’re not hotel clerks. They’re not servers. For that reason and many others, they’re subject to heavy special interests and lobbying, and scarcer skills. And that’s one of the reasons all this stuff is so expensive!
But these trends simply cannot continue without financially killing most families.
Let’s use the consumer price index (CPI) as our benchmark. It’s up 41% since the beginning of 2000, an average gain of 2.6% each year.
* Medical care is up substantially higher at 75%, or 4.8% per year.
* Educations costs are off their rocker – 120%, or 7.6% annually.
* But more surprising to me, childcare has now surpassed medical care at 82%, or 5.2% per year. Take a look:
(snip)
(Excerpt) Read more at marketoracle.co.uk ...
Theme song for bubbles popping: https://www.youtube.com/watch?v=NjxNnqTcHhg
The great deflation.
The great stagflation.
The great unraveling-deleveraging.
They all will happen and will all suck.
Thank the Lord He still has it all in His hands. If He allows such that is proof I have the ability to get through it. he promised such in His Word.
The great wring out of all the middle men.
Not if they add value.
Childcare is only so high because of government regulations. Rules like “must have handwash sink X feet from changing station” and massive amounts of documentation have essentially shut down home based childcare, such as stay at home mothers watching a couple more kids to earn money.
Childcare centers pushed the rules to improve marketshare, in the guise of public safety.
End result - these rules shut down 30% of in home childcare in Texas, and costs went up.
Yep, always the same problems - some combinations of lawyers, government, regulations, activists, liberal weenies and the death of common sense.
The phenomena described in this article has been observed for a while. The best term I have seen for it is “screwflation”. Screwflation is defined by the stuff that the middle class buys and (mostly) needs, such as health insurance, road tolls, college tuition for the kiddos, etc... have all increased in price at a much greater pace then their earnings.
This is pretty good article about it from 2011: http://www.barrons.com/articles/SB50001424053111903588204576369783343545812
If a candidate starts mixing in some commentary on this trend and promises to do something about it, he or she would be unstoppable.
So....in your opinion, what would substantial deflation do to the worth of the USD over a few years?
That's a great name for it! We're getting screwed left and right. In our community there are news articles about wanting to raise the sales taxes, always "for the good of the community". We're sick of high taxes and fees. They want to push it well over 10 percent. When I was a kid, sales taxes were about 4 percent. Screwflation takes a higher and higher portion of our incomes at a greater pace than our ability to keep up, and it's never enough so they'll take more. Why the heck do we have to be gouged leaving less and less of our money in our pockets? I blame politicians and government of all types, they're all thieves who need to be spat on and pummeled. If government didn't tax so much then others wouldn't demand so much for services.
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