So much wealth has been lost, and not just at the top.
Yahoo Finance has some sobering numbers…
There’s no question the American consumer is hurting in the face of a burst housing bubble, financial market meltdown and rising unemployment.
But “the worst is yet to come,” according to Howard Davidowitz, chairman of Davidowitz & Associates, who
believes American’s standard of living is undergoing a “permanent change” – and not for the better as a result of:
- An $8 trillion negative wealth effect from declining home values.
- A $10 trillion negative wealth effect from weakened capital markets.
- A $14 trillion consumer debt load amid “exploding unemployment”, leading to “exploding bankruptcies.”
“The average American used to be able to borrow to buy a home, send their kids to a good school [and] buy a car,” Davidowitz says. “A lot of that is gone.”
No doubt that the end of Americans spending more than you save is a good thing, but since our economy is fueled by deficit spending, both private and public, I doubt our personal economic outlooks are going to get much rosier anytime soon. Especially since this “new era of responsibility” will probably decimate the retail sector.