[Restless28]

I've had some interesting conversations with some folks who are in the "middle class". These people have vehicles financed for more than my home is worth, boats and ATV's, zero turn mowers, and large homes that are easily 5 to 10 times their gross income. They are faking "living large." It's an eminence front. (It's a put on)

Several work in the defense industry in Huntsville. If sequestration comes, the pain is going to be rough.

Those who don't work in the industry, and earn less, live just as large.

I have a feeling that the bursting of the bubble or a balck swan event will cause a shift in class structure. These middle class folks won't be able to maintain the status quo.

I imagine this scenario exists in every community in America.

[Cali-Glock]

Yeah and your local welfare mom is driving a $50k suv with $20k in rims and tires and another $5k in aftermarket stereo crap and lives in a government subsidized apartment.

Borrowing too much and living beyond your means has sadly become the brainwashed-so-called-American way.

What a change 50 years makes. In my youth my friends parents who were professionals (Drs, Lawyers, Engineers) or successful blue collar business owners lived in cheap or modest track homes, drove modest cars, purchased their clothes at Sears, took car-camping vacations in the station wagon and saved money for for a rainy day, retirement and possibly the kid's college fund.

[oldgraywolf]

Originally Posted by Restless28

I imagine this scenario exists in every community in America.

It does. I've seen a few of them crash and burn over the years.

[PaulMason]

Originally Posted by Restless28

I've had some interesting conversations with some folks who are in the "middle class". These people have vehicles financed for more than my home is worth, boats and ATV's, zero turn mowers, and large homes that are easily 5 to 10 times their gross income. They are faking "living large." It's an eminence front. (It's a put on)

Several work in the defense industry in Huntsville. If sequestration comes, the pain is going to be rough.

Those who don't work in the industry, and earn less, live just as large.

I have a feeling that the bursting of the bubble or a balck swan event will cause a shift in class structure. These middle class folks won't be able to maintain the status quo.

I imagine this scenario exists in every community in America.

The middle class has been getting hammered for decades. Since the 70s the middle class has lost pensions, health benefits, wages haven't kept up with inflation and jobs have been sent overseas. What is called middle class now - was lower middle class in the 60s/70s

[oldgraywolf]

Originally Posted by Cali-Glock

Borrowing too much and living beyond your means has sadly become the brainwashed-so-called-American way.

So true. I'd say that the ease of buying big items on credit (without sufficient financial backing for said credit) and the inability of people to delay gratification are largely responsible. I grew up knowing that if I wanted something, I had to "save up" for it. That hasn't been a common approach for many years.

[Restless28]

Originally Posted by PaulMason

The middle class has been getting hammered for decades. Since the 70s the middle class has lost pensions, health benefits, wages haven't kept up with inflation and jobs have been sent overseas. What is called middle class now - was lower middle class in the 60s/70s

They have also done it to themselves. They are not innocent.

[Restless28]

Originally Posted by oldgraywolf

So true. I'd say that the ease of buying big items on credit (without sufficient financial backing for said credit) and the inability of people to delay gratification are largely responsible. I grew up knowing that if I wanted something, I had to "save up" for it. That hasn't been a common approach for many years.

Yep. Debt makes America run.

[PaulMason]

Originally Posted by Restless28

They have also done it to themselves. They are not innocent.

How so?

[Restless28]

Originally Posted by PaulMason

How so?

Seriously? Look around.

[Fear Night]

The average American's budget looks similar to the US Government's budget. Coincidence?

[LEO/Dad]

I don't think young people are being taught this by their parents, especially if the parents aren't thrifty themselves. This includes budgeting and living within your means. I was listening to Dave Ramsey yesterday, and a mother called in upset with her son for borrowing a good amount of money for his New Years Eve. date!! Dave couldn't believe it, and laughed for a considerable amount of time. I am retired, but I know a good amount of people that are living paycheck to paycheck, both parents working. In most cases, it is by choice, just because of all the toy payments they must make. I was really surprised last summer when my local boat dealer owner told me that people were taking out Home Equity Loans to buy boats!! Really, putting your home at risk for a freakin boat. We are dealing with a culture of people today that are off the charts. Most probably voted for Obama.

[PaulMason]

Originally Posted by Restless28

Seriously? Look around.

You said they did it to themselves. I was asking how. I don't understand what you were saying.

[Gallium]

I don't know what class I am in, but the only debts I have are taxes (property tax) and a mortgage. If I didn't pay for the car it probably is not going to make it in my driveway - ditto for furniture/etc.

One of the kids' college education is partially financed, but that was his doing and choice.

The only other thing I plan on financing is a family plot for 6-10 graves. The momz are not getting any younger.

[oldgraywolf]

Originally Posted by PaulMason

The middle class has been getting hammered for decades. Since the 70s the middle class has lost pensions, health benefits, wages haven't kept up with inflation and jobs have been sent overseas. What is called middle class now - was lower middle class in the 60s/70s

How do you figure global competition works?

[Rabbi]

Originally Posted by PaulMason

The middle class has been getting hammered for decades. Since the 70s the middle class has lost pensions, health benefits, wages haven't kept up with inflation and jobs have been sent overseas. What is called middle class now - was lower middle class in the 60s/70s

Utter BS.

You take a cop married to a nurse(or just about any 40-60K a year couple) in a medium to large city...without getting over their head, they are living the lifestyle that used to be UPPER middle class in the 60s and 70's.

People live better now. The POOR in this country live the life that blue collar folks used to live.

[PaulMason]

Originally Posted by Rabbi

Utter BS.

You take a cop married to a nurse(or just about any 40-60K a year couple) in a medium to large city...without getting over their head, they are living the lifestyle that used to be UPPER middle class in the 60s and 70's.

People live better now. The POOR in this country live the life that blue collar folks used to live.

True - but in the 60s and 70's it only took one wage earner to do that; now two as you say.



Do your homework - research 1960s to now

Percent of workers covered by defined pension plans

percent of workers provided with health benefits

wages & inflation

[RC-RAMIE]

Originally Posted by LEO/Dad

I don't think young people are being taught this by their parents, especially if the parents aren't thrifty themselves. This includes budgeting and living within your means. I was listening to Dave Ramsey yesterday, and a mother called in upset with her son for borrowing a good amount of money for his New Years Eve. date!! Dave couldn't believe it, and laughed for a considerable amount of time. I am retired, but I know a good amount of people that are living paycheck to paycheck, both parents working. In most cases, it is by choice, just because of all the toy payments they must make. I was really surprised last summer when my local boat dealer owner told me that people were taking out Home Equity Loans to buy boats!! Really, putting your home at risk for a freakin boat. We are dealing with a culture of people today that are off the charts. Most probably voted for Obama.

I'm in sales in La, I could count the sales to Obama voters on one hand. Bad money decisions are made by left and right voters.


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[Dennis in MA]

Originally Posted by Fear Night

The average American's budget looks similar to the US Government's budget. Coincidence?

Bullbutter! See below. Completely patently false.

Originally Posted by PaulMason

True - but in the 60s and 70's it only took one wage earner to do that; now two.

As I said yesterday in a different thread, we all have affordable toys that NO ONE had in the 60's and 70's. How many TV's does the average house have? How many vacations that AREN'T camping at $3/night? Home in the 'burbs with 1.2acres of land and 2,000 sf of living area? Latest/greatest toys and activities for Jr? All this cost money. We didn't trade lower anything for that. We traded an at-home mom for livin large, yo.

Couple that with the skyrocketing divorce rate and the need for 1.5 households per "baby-makers" and you HAVE to have them work. Staying married is cheaper than getting divorced.


The bottom line is this: The original post is an anecdotal story, not statistical fact. Statistical fact is debt is FALLING in this country as people get MORE responsible. Just look it up. Of course, it trumps the "this country going to hell handbasket yada yada" so you have to find something else to grouse about.

[DanaT]

Originally Posted by Dennis in MA

The bottom line is this: The original post is an anecdotal story, not statistical fact. Statistical fact is debt is FALLING in this country as people get MORE responsible. Just look it up. Of course, it trumps the "this country going to hell handbasket yada yada" so you have to find something else to grouse about.

Household debt is falling the last couple of years only because of recession and inability to get loans. Look at the trend over the last 30 years and explain the trend based upon you statement.

[schild]

Originally Posted by Rabbi

Utter BS.

You take a cop married to a nurse(or just about any 40-60K a year couple) in a medium to large city...without getting over their head, they are living the lifestyle that used to be UPPER middle class in the 60s and 70's.

People live better now. The POOR in this country live the life that blue collar folks used to live.

A cop and a nurse here would make 120k+.

[Dennis in MA]

Originally Posted by schild

A cop and a nurse here would make 120k+.

They'd make $180K here. LOL And 80% pensions. And health care. Why are my taxes so high again??

[DanaT]

Originally Posted by Restless28

and large homes that are easily 5 to 10 times their gross income.

This isnt exactly a poor decision.

1) They get a tax break and lower their income tax bracket based upon mortgage interest and property tax paid.

2) The house, including the financed part, is appreciating. As long as the appreciation is equal to or higher than than the finance interest rate, one is making money on the house. Debt that you make money on is good debt. In the financial world this is called "leveraging"

If you combine number 1 and 2, it is actually not a decision to have a valuable piece of property.

[Dennis in MA]

Originally Posted by DanaT

Household debt is falling the last couple of years only because of recession and inability to get loans. Look at the trend over the last 30 years and explain the trend based upon you statement.

Oh, it's definitely not a long-term trend. We got suckered for 30 years on "debt helps the economy." But household debt is DROPPING faster than payments on said-debt would be.

Cars are flying out of showrooms. Do you really think the average 'Murican can't get credit??? And if we are in a recession, wouldn't debt payments, as a percentage of income, go up? (Is debt falling or are overall wages increasing???? Dang. Good news or . . . good news. Hmmmm.)

The number of people acting like the dufus in the OP is DECLINING, not increasing.

The only debt we have to have continued concern over is student loan debt. Because 'Murica hasn't turned the corner on "wait, this $200K piece of paper won't get me $200K more than the $50,000 piece of paper from Ayatollah State U." I'm hoping that's soon. I can't see how a Belgian Waffle Station, nice gas fireplaces and a teacher that got an article in Obscurity This Month is going to translate into a higher wage after graduation. (The BW station is my alma mater - which no longer gets any $ from me, the gas fireplace is at the library AT THE LOCAL STATE U! ARRGGGHHH!! Did I mention they have a 15M shortfall and may have to cut education. . . . because of fireplaces? Ugh.)

[Restless28]

I hope that you weren't insulting me, Dennis.

[LEO/Dad]

Originally Posted by schild

A cop and a nurse here would make 120k+.

Where I live, probably 150K. or more.