Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: Sunny Jim who wrote (95791)	3/27/2009 9:59:37 AM
From: studdog	2 Recommendations Read Replies (1) of 116555

With regard to the unionization and wage deflation discussion, we should not forget who has benefited from our economy's productivity growth over the last 30 years. Wage deflation has been going on that long for the middle class, who now make less in inflation adjusted terms then they did in 1980. "Management" has taken all of the gains and then some. The top 10% income earners have seen an incredible rise in their income. That is also where all the profits from the companies in which we have owned stocks have gone and I think is in part to blame for our current state. The middle class was exploited by "trickle down" but didn't know it because they were given access to cheap money in the form of consumer loans and home mortgages. The profits were skimmed by executives (look at the obscene salaries of our country's CEO's) who do no consume like the middle class must. When the music stopped the real consumers (middle class) were completely tapped out and could not take on more debt and there were not nearly enough chairs to sit down on. That gross inequality must be addressed or our economy will continue to produce debt serfs and will fail.

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