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Posts Tagged ‘poverty’

Monday Market Movement – Mind the (Wealth) Gap!

Congratulations to 440,000 of us!

That’s how many people became Millionaires in the past 12 months (ending in June).  According to a new survey from Phoenix Marketing International’s Affluent Market Practice, the number of American households with investible assets of $1 million or more rose 8% in the 12 months ended in June. The survey says there now are 5.55 million U.S. households with investible assets of $1 million or more.  That follows two years of declines and brings the Millionaire count back to 2006 levels. Of course, that is still below the peak of 5.97 million in 2007 and the current growth rate is well below pre-financial crisis levels, when the Millionaire population increased as much as 35% a year

Still, the numbers offer further evidence that the wealthy may have decoupled from the rest of the economy, as we expected would happen in "A Tale of Two Economies," my 2010 outlook. The study’s authors say high salary growth, rather than investments, are the main drivers of the Millionaire expansion.  As we who play the markets are painfully aware, $1M in assets doesn’t leave a lot of room for investments.  The very wealthy, on the other hand, had a much better year than the mere Millionaires. The population of American households with $5 million or more in investible assets surged 16%. The population of those with $10 million to invest increased 17%.  The rich have never been getting richer than they have been in 2010!  

Of course, in order for someone to get rich, someone has to get poor and, this year it took 4M Americans falling below the poverty line ($22,000 for a family of 4) to provide the cash for our 440,000 winners.  That’s pretty much right in line with the numbers I’ve been citing over and over again – it takes 1,000 poor people to make one rich one!  

The Census Bureau found that the fraction of Americans living in poverty rose sharply to 14.3% in 2009, up from 13.2% previously. This is the highest level since 1994. In total, 43.6 million Americans were living in poverty last year.  Even the median family is getting the shaft in America with 2010 inflation-adjusted salaries barely keeping pace with 1980 inflation-adjusted salaries – making 3 full decades without improvement for the average American family.  According to the WSJ, the bottom 40% (120M people) have dropped from having 14.5% of the nation’s income in 1980 to having 12% in…
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America’s Lost Decade – Another One in Progress Now

America’s Lost Decade – Another One in Progress Now

Courtesy of Mish 

The US used to point the finger at Japan’s "Lost Decade" saying "It won’t happen here." But it did. Median wages are nearly 5% lower in real terms than in 2000, the poverty rate is at a 15 year high, and the S&P 500 is about 20% lower than it was a decade ago.

Pleased consider the Wall Street Journal article Lost Decade for Family Income

The downturn that some have dubbed the "Great Recession" has trimmed the typical household’s income significantly, new Census data show, following years of stagnant wage growth that made the past decade the worst for American families in at least half a century.

The bureau’s annual snapshot of American living standards also found that the fraction of Americans living in poverty rose sharply to 14.3% from 13.2% in 2008—the highest since 1994. Some 43.6 million Americans were living below the official poverty threshold, but the measure doesn’t fully capture the panoply of government antipoverty measures.

The inflation-adjusted income of the median household—smack in the middle of the populace—fell 4.8% between 2000 and 2009, even worse than the 1970s, when median income rose 1.9% despite high unemployment and inflation. Between 2007 and 2009, incomes fell 4.2%.

Lost Decade Lowlights

  • Americans living in poverty rose sharply to 14.3% from 13.2% in 2008
  • Poverty level is the highest since 1994
  • 43.6 million Americans are living below the official poverty threshold
  • Inflation-adjusted income of the median household fell 4.8% between 2000 and 2009
  • The number of 25-to-34-year-olds living with their parents rose 8.4% to 5.5 million in 2010 from 2008
  • Child poverty rose to 23.8% for kids under six in 2009, compared to 21.3% a year earlier

Census Bureau Charts

Here are a few select charts from Income, Poverty, and Health Insurance Coverage in the United States: 2009, Issued September 2010.

click on any chart for sharper image

Real Incomes 1967 to 2009

Poverty Rates 1959 to 2009

In general, the chart shows the "War on Poverty" was a failure regardless of what political party was in office. The odd pair of Clinton and Nixon did the best, while Carter and George W. Bush the worst. Reagan and George H. Bush both had roller coasters ending about where they started, while Ford essentially experienced a flatline.

Since the…
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20 Signs That The Economic Collapse Has Already Begun For One Out Of Every Seven Americans

20 Signs That The Economic Collapse Has Already Begun For One Out Of Every Seven Americans

Courtesy of Michael Snyder at Economic Collapse 

For most Americans, the economic collapse is something that is happening to someone else.  Most of us have become so isolated from each other and so self-involved that unless something is directly affecting us or a close family member than we really don’t feel it.  But even though most of us enjoy a much closer relationship with our television sets than we do with our neighbors at this point, it is quickly becoming undeniable that a fundamental shift is taking place in society.  Perhaps you noticed it when two or three foreclosure signs went up on your street.  Or perhaps it got your attention when that nice fellow down the street lost his job, and he and his family seemingly just disappeared from the neighborhood one day.  The Census Bureau made front page headlines all over the nation this week when they announced that one out of every seven Americans was living in poverty in 2009.  Every single day more Americans are getting sucked out of the middle class and into soul-crushing poverty.   

Unfortunately, most Americans don’t really care because it has not affected them yet.

But this year, millions more Americans will discover that the music has stopped playing and they are left without a seat at the table.

Meanwhile, neither political party has a workable solution.  They just like to point fingers and blame each other.

The Democrats blame Bush for all the poverty and advocate expanding programs for the poor.  Not that there is anything wrong with a safety net.  But the "safety net" was never meant to hold 50 million people on Medicaid and 40 million people on food stamps.  The number of Americans on food stamps has more than…
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Let Them Eat Cake

Let Them Eat Cake

Courtesy of PAUL CRAIG ROBERTS at CounterPunch 

RHINEBECK, NY - JULY 30: A congratulations sign on display on July 30, 2010 in Rhinebeck, New York. Chelsea Clinton plans to get married in Rhinebeck on July 31, 2010. (Photo by Bryan Bedder/Getty Images)

It is not unusual for members of the diminishing upper middle class to drop $20,000 or $30,000 on a big wedding. But for celebrities this large sum wouldn’t cover the wedding dress or the flowers.

When country music star Keith Urban married actress Nicole Kidman in 2006, their wedding cost $250,000. This large sum hardly counts as a celebrity wedding. When mega-millionaire real estate mogul Donald Trump married model Melania Knauss, the wedding bill was $1,000,000.

The marriages of Madonna and film director Guy Ritchie, Tiger Woods and Elin Nordegren, and Michael Douglas and Catherine Zeta-Jones pushed up the cost of celebrity marriages to $1.5 million.

Tom Cruise and Katie Holmes upped the ante to $2,000,000.

Now comes the politicians’s daughter as celebrity. According to news reports, Chelsea Clinton’s wedding to investment banker Mark Mezvinsky on July 31 is costing papa Bill $3,000,000. According to the London Daily Mail, the total price tag will be about $5,000,000. The additional $2,000,000 apparently is being laid off on US Taxpayers as Secret Service costs for protecting former president Clinton and foreign heads of state, such as the presidents of France and Italy and former British Prime Minister Tony Blair, who are among the 500 invited guests along with Barbara Streisand, Steven Spielberg, Oprah Winfrey, Ted Turner, and Clinton friend and donor Denise Rich, wife of the Clinton-pardoned felon.

Before we attend to the poor political judgment of such an extravagant affair during times of economic distress, let us wonder aloud where a poor boy who became governor of Arkansas and president of the United States got such a fortune that he can blow $3,000,000 on a wedding.

The American people did not take up a collection to reward him for his service to them.
Where did the money come from? Who was he really serving during his eight years in office?

How did Tony Blair and his wife, Cherrie, end up with an annual income of ten million pounds (approximately $15 million dollars) as soon as he left office? Who was Blair really serving?

These are not polite questions, and they are infrequently asked.

While Chelsea’s wedding guests eat a $11,000 wedding cake and admire $250,000 floral displays, Lisa Roberts in Ohio is struggling to raise contributions for her food pantry in order to feed…
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Why Teachers’ Unions Matter

Unions have become a divisive issue in the financial bloggosphere, so in the interest of presenting both sides, here’s an article supporting Unions. Another article showing a flip side to prevailing anti-Union wrath is Zero Hedge‘s Labor Unions Preparing To Take Goldman Sachs To Task, Push For Transaction Tax In Upcoming Widespread Rallies. – Ilene  

Why Teachers’ Unions Matter

Nurses, Teachers, Students And Firefighters Protest Schwarzenegger Event

By SHAMUS COOKE writing at CounterPunch 

Nowadays a newspaper cannot be opened — or a TV turned on — without one being subjected to anti-teacher misinformation. The anti-teacher hysteria looks diverse on the surface, but underneath, this public controversy seeks to dislodge teachers unions: the right-wing trashes teachers’ unions outright, while the “liberal” media takes a more subtle, sophisticated approach, blaming the state of public education on “bad teachers” who must be fired and replaced. Both styles are the same in essence. 

The bi-partisan goal is to undermine and dismember public education, so that public funds may be instead channeled into paying debts racked up by multiple wars and corporate bailouts. Also, as public education is gutted, rich investors parasitically benefit from it by opening for-profit “charter schools,” curriculum corporations, or the bevy of new companies that "certify" teachers for a fraction of the cost or time of universities, ready to serve at the new corporate McEducation institutes.

Obama’s Race to the Top campaign enshrines these odious goals into governmental policy, picking up where Bush’s anti-teacher union policies left off, and racing frantically in the same direction, to the bottom. 

The schools that Bush’s No Child Left Behind labeled as “failures” are to be shut down under Obama’s Race to the Top. These schools are almost entirely in poor neighborhoods, where the social disease of poverty is an easy predictor of a child’s poor test scores.

But Obama ignores this obvious fact and blames poor grades and test scores on the teachers, exclusively. 

Thus, Obama cheered when every teacher at a Rhode Island “failing” high school was fired. He praised the past closures of dozens of public schools in both Chicago and New Orleans as examples for others to follow. Indeed, Detroit and Kansas City each have plans to close dozens of schools, while California is set to fire thousands of teachers. Under Obama’s plan, federal money is awarded to states that fire the most "bad" teachers and close the most “failing” public schools. 

Charter schools…
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NYT: 1 in 4 Children, and 1 in 8 Americans Now on Food Stamps

NYT: 1 in 4 Children, and 1 in 8 Americans Now on Food Stamps

food stampsCourtesy of Trader Mark at Fund My Mutual Fund

The topic of what is happening with hunger is nothing new to regular readers of FMMF; we’ve been harping on it for over 2 years as mirage like stories of the "strength" of the US economy, based on government reports (2007, early 2008) and measures such as GDP dominate our ideas of how to measure prosperity.   But judging from the "comments" section in the web version of this weekend’s story in the New York Times, a lot of Americans are getting their first education on what is truly happening under the surface.  I assume many foreign readers must also be shocked as they read about the dirty underbelly of the world’s "richest"* country.
*excluding debt.

When I began the blog in summer 2007, 1 in 11 Americans were on food stamps.  In just a few years that had jumped to 1 in 9.  [Jun 8, 2009: 1 in 9 Americans on Food Stamps]  Now, the New York Times report says the figure has unfortunately hit new thresholds….increasing to 1 in 8 Americans, including 1 in 4 children.  Let us be clear, there is certainly fraud in the system, and people taking advantage of the largesse of the government – that cannot be disputed and if there is one place to increase government spending, it is auditing of these type of programs..  But there is no way that rate of increase happens due to just fraud… it’s an indictment of the hollowing out of our economy and the increasing bifurcation of the economic fortunes in the country.   Not everyone can be a business owner or investment banker – jobs that used to fulfill the needs of the "middle" of America are disappearing and no one asks the questions of why.  Meanwhile, the cost of living remains high, in fact our central bank is trying to increase it by the minute rather than letting the market decrease them (AS IS NEEDED), while wage have been pressured for over a decade.  The house ATM filled the gap for many in the middle part of the decade but people are now out of options…

We’ve warned / predicted in 2007 this was going to be a long term trend, but frankly even I am shocked…
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Decade of No Income Gains

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Decade of No Income Gains

low income Courtesy of Mish

For the first time since the great depression (and possibly even then), US wage earners suffered through A Decade With No Income Gains.

The typical American household made less money last year than the typical household made a full decade ago.

To me, that’s the big news from the Census Bureau’s annual report on income, poverty and health insurance, which was released this morning. Median household fell to $50,303 last year, from $52,163 in 2007. In 1998, median income was $51,295. All these numbers are adjusted for inflation.

In the four decades that the Census Bureau has been tracking household income, there has never before been a full decade in which median income failed to rise. (The previous record was seven years, ending in 1985.) Other Census data [Historical Income Tables] suggest that it also never happened between the late 1940s and the late 1960s. So it doesn’t seem to have happened since at least the 1930s.

Income, Poverty, and Health Insurance Coverage

Inquiring minds are digging into the Slide Show Presentation on Income, Poverty, and Health Insurance Coverage in the United States: 2008

click on any chart to see a sharper image

income

poverty

percent change in real median income

There are numerous other charts in the slide show on health insurance and poverty levels. Inquiring minds will want to take a look.

David Leonhardt writes "The streak probably won’t end in 2009, either. Unemployment has been rising all year, which is a strong sign income will fall."

Given that we are likely to have Structurally High Unemployment For A Decade, this trend of stagnant or falling wages can last much longer than most realize.

Here’s something to think about: If the housing boom from 2000 to 2007 produced no sustainable wage increases (if indeed any wage increases at all) what will? After pondering that, think about where home prices are going with poor wage potential and tightened lending standards.

Indeed what does this trend say about price pressures in general?

Mike "Mish" Shedlock

Photo: Low income states, Photo and license at Wikimedia.

 


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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!

 
 

Chart School

The Perfect (Dollar) Storm - When Currencies Collide Part 2

Courtesy of Doug Short.

Click here to read Part 1.

Part 2 Summary
  • Major breakout in USD means:
    • U.S. stocks over foreign markets
    • Stocks over bonds
    • Higher price multiples for U.S. stock markets
  • Short-term, USD due for a breather and euro for a rally

Investment Implications of a USD Breakout

Should the USD break out from its 2005 to present bearish trend, we should see some significant developments in inter-market relationships. For starters, the relative performance of U.S. stocks to the MSCI World Stock Index Excluding the U.S. shows a strong correlation to the USD Index. Should t...



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Phil's Favorites

The Consequences Of Fracking: Two Clashing Views

Courtesy of Andy Tully via OilPrice.com

Two academic studies of the health dangers of hydraulic fracturing, or fracking, have produced different conclusions.

One, conducted by Yale University, said people living near fracking sites report increased health problems. The other, by Penn State University, says fracking water stays underground, far below the groundwater supplies that people use for drinking, and poses no threat.

Both studies were conducted in Pennsylvania, part of the Marcellus Shale formation in the sprawling Appalachian Basin in the eastern United States. It holds enormous reserves of gas and has been a focus of fracking activity and protests.

In the Yale study, former Yale medical professor Dr. Peter Rabinowitz reported in the...



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Zero Hedge

The Last Straw? Venezuela Runs Out Of Fake Breasts

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Venezuelan women are revolting complaining. While the citizens of the socialist utopia can withstand shortages of food, toilet paper, and now even news paper, in a nation thought to have one of the world's highest plastic surgery rates, ...



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Promotions

See Live Demo Of This Google-Like Trade Algorithm

If GOOGLE, the NSA, and Bill Gates all got together in a room with the task of building the most accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.

Well, I hate to break it to you… they never got around to building it, but my colleagues at Market Tamer did.

Follow this link to register for their training webinar where they’ll demonstrate the tested and proven Algorithm powered by the same technological principles that have made GOOGLE the #1 search engine on the planet!

And get this…had you done nothing but traded a handful of conservative alerts since its inception, you would have experienced portfolio gains exceeding 200%!

Plus, when you register for the webinar you’ll g...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Sabrient

Sector Detector: Bulls go down swinging, refusing to give up much ground

Courtesy of Sabrient Systems and Gradient Analytics

Although the stock market displayed weakness last week as I suggested it would, bulls aren’t going down easily. In fact, they’re going down swinging, absorbing most of the blows delivered by hesitant bears. Despite holding up admirably when weakness was both expected and warranted, and although I still see higher highs ahead, I am still not convinced that we have seen the ultimate lows for this pullback. A number of signs point to more weakness ahead.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, review our weekly fundamentals-based SectorCast rankings of the ten U.S. business sectors, and then offer up some actionable trading ideas, including a sector rotation strategy using ETFs and an enhanced version using top-r...



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OpTrader

Swing trading portfolio - week of September 15th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Insider Scoop

Compass Point Sees Good Things Ahead For Navient Corp

Courtesy of Benzinga.

In a report published Monday, Compass Point analyst Michael Tarkan reiterated a Buy rating and $21.00 price target on Navient Corp (NASDAQ: NAVI).

In the report, Compass Point noted, “We reiterate our Buy rating on NAVI shares after analyzing updated credit data within the company's private student loan trusts, which indicate continued YOY improvement in delinquency and default rates. The data captures statistics for trusts originated from 2002 through 2014 for the three months ended August 31, 2014, providing a good leading indicator for 3Q14 credit trends. The ongoing improvement should give management flexibility to continue to lower provision expenses to drive earnings higher.”

Navient Corp closed on Friday at $17.62.

Latest Ratings for NAVI DateFirm...

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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's the latest Stock World Weekly. Enjoy!

[Sign in with your PSW user name and password, or take a free trial here.]

Image courtesy of Business Insider, Jay Yarow's This Is The Best Description Of How Apple's Business Works Right Now.

 

...

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Option Review

Big Prints In VIX Calls

The CBOE Vix Index is in positive territory on Friday morning as shares in the S&P 500 Index move slightly lower. Currently the VIX is up roughly 2.75% on the session at 13.16 as of 11:35 am ET. Earlier in the session big prints in October expiry call options caught our attention as one large options market participants appears to have purchased roughly 106,000 of the Oct 22.0 strike calls for a premium of around $0.45 each. The VIX has not topped 22.0 since the end of 2012, but it would not take such a dramatic move in the spot index in order to lift premium on the contracts. The far out-of-the-money calls would likely increase in value in the event that S&P500 Index stocks slip in the near term. The VIX traded up to a 52-week high of 21.48 back in February. Next week’s release of the FOMC meeting minutes f...



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Digital Currencies

Making Sense of Bitcoin

Making Sense of Bitcoin

By James Black at International Man

Despite the various opinions on Bitcoin, there is no question as to its ultimate value: its ability to bypass government restrictions, including economic embargoes and capital controls, to transmit quasi-anonymous money to anyone anywhere.

Opinions differ as to what constitutes "money."

The English word "money" derives from the Latin word "moneta," which means to "mint." Historically, "money" was minted in the form of precious metals, most notably gold and silver. Minted metal was considered "money" because it possessed luster, was scarce, and had perceive...



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Market Shadows

Helen Davis Chaitman Reviews In Bed with Wall Street.

Author Helen Davis Chaitman is a nationally recognized litigator with a diverse trial practice in the areas of lender liability, bankruptcy, bank fraud, RICO, professional malpractice, trusts and estates, and white collar defense. In 1995, Ms. Chaitman was named one of the nation's top ten litigators by the National Law Journal for a jury verdict she obtained in an accountants' malpractice case. Ms. Chaitman is the author of The Law of Lender Liability (Warren, Gorham & Lamont 1990)... Since early 2009, Ms. Chaitman has been an outspoken advocate for investors in Bernard L. Madoff Investment Securities LLC (more here).

Helen Davis Chaitman Reviews In Bed with Wall Street. 

By Helen Davis Chaitman   

I confess: Larry D...



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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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