Joe--I have been reading that study made by Jagadeesh Gokhale and KentSmetters.
That gives a great deal of data to support my view and OTHERS view that we aren't going to bottom until possibly 2013.
If what they are implying that boomers in the 50 year old level in the main are way behind for arriving at a correct retirement need, this is not good.
Also on reading that article i see a thoughtline that screams out, housing is going to go into a MAJOR/catastrophic bust around 2007 or so as too many are buying or refinancing them now as an asset they intend to convert into cash for retirement, and that in turn will glut the market with supply,imo.
The "old saw", when the middleclass starts going under all hell can break loose.
I see, as George Soros sees and Buffet sees; a rich get richer and middle class gets poorer and poorer scenario.
Their logic here i feel is solid.
<<Your typical 50-year old, middle class American isn't prepared to
retire without a lot of help. In fact, most baby boomers will never
even pay off their mortgages. Lawrence Capital Management notes in the
last 19 quarters total mortgage debt increased by $3 trillion (+58%).
To put this in perspective, prior to 1997, it took 13 years to add $3
trillion in mortgage debt. Or, said another way, before 1997, around
$50 billion a quarter was being borrowed against homes. Today the run
rate is near $200 billion per quarter, or four times more. Household
borrowings now total $8.2 trillion in America and they continue to
grow at near double-digit rates.
And it's not just mortgage debt that's problematic...
According to the Federal Reserve Bank of St. Louis, US household
consumer debt is up more than 12% from last year. Debt service, as a
percentage of disposable income, is above 14%. Only twice in the last
25 years has debt service taken as large a chunk of America's income -
- and that's despite the lowest interest rates in fifty years.
When you look at these numbers you quickly see the problems our
favorite weekly scribe, John Mauldin, hopes we can "muddle" through:
The government is making promises it can't keep without bankrupting
the nation; the individual American has made promises to his bank he
can't keep without bankrupting his family. And we haven't even looked
at the biggest borrowers yet - corporations.>>
He played his video game night and day.
The MAZE of Death.
But that is the game we all are in, the trick, don't believe it.Get above it all and imagine nothing is what it seems.Kill the machine.otraque
AI
