Household Income Trends During the Recession and Economic Recovery
http://www.sentierresearch.com/pressreleases/SentierResearch_PressRelease_October_10_2011.pdf

Good to see you back AJ!  Thanks for the article.

Yup.  The "average" consumer has seen a 10% decline in HH income.

The data's not there, but given all the commotion around who's getting rich in this country and who's not, I'd be curious to see a distribution of median HH income across specific subsets of the economy (say the bottom 25%, 26%-90%, 90%-99%, and 99%+).

I don't honestly know what the values would be, but it'd be bound to shed more light on a political topic that seems to enjoy more heat than light at the moment.

Originally Posted By FarAway Sooner

Yup.  The "average" consumer has seen a 10% decline in HH income.

 

The data's not there, but given all the commotion around who's getting rich in this country and who's not, I'd be curious to see a distribution of median HH income across specific subsets of the economy (say the bottom 25%, 26%-90%, 90%-99%, and 99%+).

 

I don't honestly know what the values would be, but it'd be bound to shed more light on a political topic that seems to enjoy more heat than light at the moment.

It's not as though income groups are static.  People who start in the bottom 50 percent group in ten years will find only 18 percent are still there and those that make it to the top 1 percent a decade later only 16 percent are still there.  We want the upper rates to go higher and we want the opportunity for people to get there and spend enough time there to earn a comfortable retirement.  Too much is made of income gaps with no notice that people move up and back down through those income levels.

The bigger problem to be adddressed is the redistributive effect of the Feds planned inflation.  The upper income groups get first crack at the excess money pumped into the system and get to make use of it before prices rise.  The lower half of the income strata receive the higher prices generated by that inflation before they see their wages and other compensation increased.  Furthermore, the economy is distorted in favor of those who first see the new money, the more wealthy; production is geared toward their consumption and away from those in the lower half income earnings.  Resources are diverted from their needs and don't shift back until their savings are erroded and their compensation becomes inflated too.  This is why those in the bottom 50 percent income groups have the same wage compensation they had 25 years ago accounting for inflation while the top 1, 5, 15 and 25 percent groups have seen there incomes rise appreciably.

Jack, I can't think of the last time that I agreed so completely with a post you made! 

Originally Posted By FarAway Sooner

Jack, I can't think of the last time that I agreed so completely with a post you made! 

Funny; I can't fathom how you've ever disagreed.

Behind all that is the "great leveraging":

http://blogs.reuters.com/rolfe-winkler/2009/09/30/krugman-and-the-pied-pipers-of-debt/

Thus, we had increased borrowing and spending not only by government but also by households and corporations. Households were buying (and in several cases, selling) houses to be used as collateral to buy even more goods. Corporations were moving to Wall Street to make more profits from financial speculation, with some households joining them. And the military is heavily dependent on more funds from government and support for corporations in order to pay for very expensive war costs, which in terms of invasions and military intervention allow several corporations to profit, with costs passed on to sheeple.

The only way out is to cut down heavily on borrowing and spending, something which none of these sectors will like. And when that happens, an economy where 70 pct of activity is based on consumer spending and where most work in the service industry, will collapse.

Finally, while countries like China attempt to "delink" from the U.S., they are also aware that if the U.S. falls apart, so to will they and other members of a dollar-denonimated global economy.

And yet all of these refer simply to money, not just "printed" by "gubermint" but almost a quadrillion dollars in "shadow" derivatives created by commercial banks. Outside that fantasy world is the threat of a resource crunch:

http://motherjones.com/kevin-drum/2011/08/our-oil-constrained-future

something that no amount of credit creation will solve.