Posted: May 20th, 2010 | Author: jenny | Filed under: Uncategorized | No Comments »
Well, a lot has happened since we saw the social unrest beginning amongst Berkeley students angry over budget cuts. God love the Berkeley students- always on the ball providing a real bellwether for social direction! Didn’t I tell you we’d be seeing more soon enough? Of course, I’m sure by now you’ve heard about what’s been going on in Greece. We are in the midst of a global sovereign debt crisis, and the cracks in the walls have begun to leak and spurt. I’ve been noticing quite a few folks are getting angry, 
as well they should be. We are still somewhat protected here in the good ol’ USA. More cushion for the pushin’, financially speaking. We’ve got a little more fat to burn… and let’s face it, we’d rather not miss the next episode of American Idol to go out and get our hair all mussed in some unsavory angry rally type of exchange. At least, I speak for myself. But we will pay the price for that. We are paying right now. The middle class will be demoted to poor, and the poor will die. I hope I’m just being dramatic. Here are some articles I’ve come across.
From: BBC News
Thousands protest over Romania austerity measures
http://news.bbc.co.uk
From: WCNC.com
Greek unions hold new general strike against cuts
http://www.wcnc.com
From: Bloomberg.com
Sarkozy Grapples With ‘Politically Unacceptable’ Cuts
http://www.bloomberg.com/news/2010-05-19/
From: Belfast Telegraph
Banks protesters storm Irish parliament
http://www.belfasttelegraph.co.uk
From: LA Times
Schwarzenegger’s budget a blow to the poor
http://articles.latimes.com
Posted: May 20th, 2010 | Author: jenny | Filed under: Uncategorized | No Comments »
The Consumer Price Index fell into negative territory last month. We are seeing the smallest 12-month gain since 1966. This indicates the cost of living is falling. It is cited in the article below as being a reaction to unemployment and foreclosures. I would include pay cuts and lack of credit, as well. Many who are still employed have seen their pay reduced in some form, or are working part time jobs when they’d like to be working full time. Loans are hard to get. Home equity is gone and HELOCs are closed down.
The fall in prices is considered a red flag indication of deflation at work. The CPI doesn’t even include the price of buying a home. It uses rental prices, which are also falling now. If it used the price of purchasing a home we’d have gone negative long ago and would see much deeper plunges in the numbers right now, of course.
Funny, this was a “surprise” to economists but the bloggers I read have been talking about it for eons. Thank you, internet!
Prices falling sounds like a good thing, but in a deflationary climate falling income outpaces those falling prices and our inability to pay escalates faster than prices around us are discounted. Destruction of wealth and falling income lead the way with prices falling in response. If it takes hold, deflation is a very difficult process to stop. We’ll just have to ride it out. Ultimately the correction is necessary and good. Like Shiva’s dance of destruction, like the winter freeze that prepares the seed for next spring’s bloom.
So now is probably a good time to pay off all your debt! And sell anything of value you don’t need.
From: Bloomberg.com
Consumer Prices in U.S. Unexpectedly Drop, Core Rate Unchanged
By Timothy R. Homan
May 19, 2010
http://www.bloomberg.com/news/2010-05-19/
as well they should be. We are still somewhat protected here in the good ol’ USA. More cushion for the pushin’, financially speaking. We’ve got a little more fat to burn… and let’s face it, we’d rather not miss the next episode of American Idol to go out and get our hair all mussed in some unsavory angry rally type of exchange. At least, I speak for myself. But we will pay the price for that. We are paying right now. The middle class will be demoted to poor, and the poor will die. I hope I’m just being dramatic. Here are some articles I’ve come across.