That means a lot. Americans have been borrowing against their houses to buy a standard of living higher than they could afford. Globalization in the form or cheap Chinese and a previously strong currency allowed us to feel flush.
What people forget is that housing was NOT an ATM. That implies cash in your account. Equity loans were credit cards that now need to be paid back.
As a nation, we’ll have to get used to a lower standard of living. We’ll have to sell some of the family jewels to foreigners to stay solvent.
This is the wealth effect in reverse. The poverty effect?
I’m better off than the average person. But I’m feeling pretty depressed about the state of our country right now. That feeling sucks especially if you have to step outside of our borders.
