Yes, it means that the middle class is disappearing.
Or just being redefined.
I locked in mortgage rate at 6% 2.5 years ago and feel foolish for it. If I went adjustable I'd be paying half has much all these year - and possibly now going forward many years into the future. But I was really figuring over 30 years it would more than pay for itself if rates every did climb back to 8 or 9 or higher. Perhaps I was wrong and those days are over.
My friend went with interest only loan in 1997, converted it to adjustable in 2001. He's lived in a home for dirt cheap all these years, and saw his home value rise 8 times what he paid for it. He has a 1 bd above his garage that he rents, and it covers a fair portion of his mortgage. He has since refinanced and bought a property in St. Tropez, fully protected under a corporation. They could some day forclose his home here, but he'll always have his other property to live in - and it's a duplex, so he can live in one and rent the other. He can easily get $3000 a week in the summer months in rental income.
That statement is so wrong it is hard to no where to start.
But you can't seriously believe that having high interest rates HELP the middle class.
Care to explain how high interest rates (meaning high inflation) which lowers investment, lowers job creation, makes housing much more difficult to buy, makes financing of anything much more expensive, rations loans to the most credit-worthy etc. could help the middle class?