Debt serf, middle class, or wealthy?................from Rico

The financial crisis was 'sold' to the ignorati as a 'liquidity' problem, but was actually a 'solvency' problem. Too much debt. The TBTF-TBTJ (too big to fail-too big to jail) bankers got greedy, overleveraged and faced a squeeze because they were broke and could not cover all of the stupid bets they had made.

- The Central Banks have been attempting to paper-over that debt problem with more debt ever since. WARNING: Boobus Americanus, do NOT try this at home! This is pure Keynesian rubbish and does not work. Like Communism, it never has.

While the Central Bankers "bailed out" and "bailed-in" their pals, the TBTF-TBTJ bankers, the Taxpayer not only covered their gambling losses but Mr & Mrs Main Street were drawn-and-quartered to save the gamblers into the bargain.

- Meanwhile, the Greek chorus of teleprompter readers and talking heads have been bemoaning the death of the middle class...but without explaining the actual reasons for it (just like they never have admitted the 'real' cause of the financial crisis, and cannot bring themselves to say Communism is a thoroughly failed idea).

DEATH OF THE MIDDLE CLASS IN SLOW-MOTION.

The death of the middle class has many dynamic parts:

- Soaring costs of government (ever bigger, ever more expensive)

- The rot of financialization

- Stagnant wages

- Plus of course, the inflation we're daily told we do not have (even the jiggered CPI has increased 300% from 1978-2004; hint: it has NOT gottem any better from 2004 to 2014. )

- And not least, DEBT (access to credit has been 'sold' as access to wealth. It is not. It is access to debt, not wealth...and as Napoleon once observed "...the hand that gives is above the hand that receives.")

WELCOME TO SERFDOM.

With a solidly middle class income of $50K, it's not low enough to qualify for government handouts, yet not high enough to escape having to make trade-offs. They might 'think' they are middle class but are debt-serfs.

- While they superficially 'own' (a home, vehicles, igadgets, etc), by the time their (after-tax) income goes to debt-service on the house they bought at the peak of the market with little down and a big mortgage, auto loans, credit card balances, plus paying for utilities, food, transportation, and healthcare costs there is nothing left to save or invest. Their net worth is at best zero, but is more likely negative.

.....The mortgage will never be paid off.

.....The auto loans will be rolled-over into newer cars and bigger loans.


My question is, are they debt serfs, middle class, or wealthy?

- Most are mired in debt-serfdom and bound to the financial sector as securely as any medieval peasant was bound to the noble's manor house.

The US is now a neo-feudal state based upon debt.

STAYING MIDDLE CLASS.

To stay middle class, debt needs to be destroyed and the self-sabotaging consumption of the permanent debt-based consumerism that bleeds wealth into the financial sector while crippling any ability to accumulate capital needs to be avoided.

THE 'NEW' WEALTHY.

If a middle class family owns a home free and clear (no mortgage...don't roll your eyes, about 1/3 of homes in the US actually ARE mortgage-free), owns debt-free vehicles, has no loans or credit card debt, and spends less than their income (saving and investing the unspent income)...they are FREE by virtue of not having followed the herd into certain financial death.

- They can also be considered wealthy, having achieved a level of security and prosperity that eludes free-spending families with double their income.