Posted on 02/22/2022 3:54:44 PM PST by proxy_user
As most of the Covid special benefits run out, the people in the bottom half are starting to run out of money, while the top 20% and top 10% are still quite well-off. A lot of the money the people in the bottom 50% spent in the past two years is now in the accounts of the affluent.
A rise in interest rates is the most likely event that will shrink stock portfolios and house values, but for now they have the cash for increased spending.
So……..2008 all over again, only worse because that absolute incompetence and corruption of those in DC
Makes me glad I’m completely debt free.
So, rich people cause inflation when they spend their money?
Is that what the article says?
Not, the government printing more money?
I call bullshit on this.
Printing and pumping trillions more into the economy doesn’t help inflation either. But it does help the Democratic party to create more economic dependence by their constituents thus assuring repeat Democratic voters, which is all they’re really concerned with.
Sorry. My home value on Long Island jumped 33% in the last year. I didn’t rush out and start buying stuff. Instead I had to put aside $$ because Nassau County and my school district were gonna be coming for more of my real money.
Shawn Tully-Agenda Contributor-The World Economic Forum
Looky, it's the My Ass desk reporting in.
Oh, yeah, inflation ain’t Biden’s fault. It is all the fault of wealthy Americans. BTW, $125,000 annual income ain’t wealthy.
Entire article is based on the faulty assumption smart ordinary people who have garnered and grown assets will now hock them to buy depreciating and overpriced goods like cars. WRONG! Sure, if there’s a need and available cash on hand, but no-one who has built up his finances has done so by going into debt for the “next phone” or latest model car - especially with the sticker price rape going on.
Far more people are going into debt to make that inflated car purchase with an extra $50k “dealer add-on” over sticker [actually saw that on a 2021 Jeep Grand Cherokee a couple of weeks ago in LA]
“Perhaps the most overlooked engine fueling inflation is the “wealth effect,” the extra spending from Americans feeling flush as their stock portfolios and home prices jumped by trillions during a tag-team, Olympic sprint for both. “
The BS is strong with this one.
Your comment about home values jumping and the premise behind the article’s theory brings to mind my home sales this year. In my 70s and with serious health concerns in the last three years, we decided to sell our modest vacation cabin and our Suburban Phoenix area home to be closer to family in the Eastern time zone.
As luck would have it, the Lake of the Ozarks and suburban valley of the sun had great price booms the made our move comfortable. Do you know who could afford the high prices in both cases. The so called wealthy. The conservatives? Nope.
Both cases the ratcheted up homes were bought by school teachers. In the case of the vacation cabin, teachers with tenure and more spare time in their late thirties. In the bigger bite suburban home by retiring school teachers from near the Canadian border. Big pensioners.
That’s who drove those inflation purchases in my world.
So that explains all of the recent college graduates with a low earning potential degree, off-the-charts entitlement and no sense of economy who’ve already amassed $750K in debt from school loans, vehicles and credit card debt that are trying to buy homes at 30% above market value? Who knew?
The value of any given market is driven by what the least astute participant is willing to pay. Right now, least astute is leading the charge....not the rich.
Central bankers love you and care about you.
The Federal Reserve prints money and they aren’t government.
Has the author ever met a rich person, or does he just resent his dad? :)
I don’t think so.
What do YOU think is “rich”?
Right it’s not printing enough money every week to fill a cruise ship or almost destroying domestic energy production, it’s the rich causing this.
Rich people have made a lot of money from the ongoing inflation. That is the nature of rapid inflation. It transfers real wealth from the middle class to the wealthy. They, as a result, spend more money. It is a cart and horse situation here.
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