It's the Economy Stupid


For practically 7 years now, we've been waiting for the economy to improve. I have a question for the middle class; do you see an improvement? Is your pay staying up to date with inflation? Are you paying more for obtained money, and getting less for the cash you save?

I have actually been following economics in general for 30 years and in certain the duration since the last crash. Now, it appears to me that not only am the economy not improving, it's at finest flat, or worsening.

The middle class has been paying a heavy cost since that time. The interest rate that you on your cost savings is minuscule, while interest rates on your credit cards and automobile loans are sky-high.

Other locations of issue are the small boosts in pay, and even having the ability to find a job at a good wage, or any job at all in some cases. Check out more information about Finance click on .

It is extremely challenging right now to get a home mortgage unless you have at least 20 % for a down payment plus closing costs. Home mortgage rates are presently fairly low, they are not at their all-time low. Even at the current rates banks are putting actual estate purchasers through extensive credit screening because of the climate that was developed by them, whereas people who bought houses throughout the peak years back in 2007, found it simpler to walk away from their mortgage because they were paying more for their houses than they were worth.

Home prices have actually rebounded somewhat, it is expected that another decline will happen at some point in the near future. This will make it more difficult for the banks and the customers alike. From the banks viewpoint, more people will certainly be walking away from their homes leaving the banks high and dry, which in turn will certainly make it even more challenging for borrowers to get a loan.

This will not just impact home mortgages, but may put a strain on charge card holders as well, and again will certainly force the Federal Reserve to keep rates low, which will keep mortgage rates low and interest on your cost savings low.

How the Federal Reserve controls bank rates is a topic for another post. Anybody who is old enough to get a loan or have money in a savings account should understand exactly how the Federal Reserve works. It's only reasonable to warn you that the Federal Reserve is not part of our federal government but a privately owned bank or consortium of lenders.

Although this is not an in-depth post on the economy there ought to be enough details to get you thinking about exactly what's truly going on in the economy and how it affects you straight and indirectly.


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