Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

A Shocking Numbers of Americans Live Paycheck to Paycheck

  by    0   0

We’re told that this is the greatest economy in history. Stock markets are surging. Unemployment is low. And yet despite the good times, a shocking number of Americans live paycheck to paycheck.

Several surveys cited by MarketWatch reveal the precarious financial situation many Americans find themselves in. This is less than ideal in an economy dependent on consumer spending.

According to Neilsen Data, 50% of Americans who make $50,000 per year or less live paycheck to paycheck. But it’s not just lower-income earners who struggle. A quarter of families making $150,000 more per year say they can’t save and one out of every three households earning between $50,000 and $100,000 per year live paycheck to paycheck as well. Recent reports from the American Payroll Association and the National Endowment for Financial Education found 74% of all employees live paycheck to paycheck. And according to Bankrate’s latest Financial Security Index, 30% of Americans have no emergency savings at all.

Why can’t Americans save money in the greatest economy ever?

According to the MarketWatch report, despite low unemployment, stagnant wages coupled with a rising cost of living are squeezing worker’s wallets. According to a recent Bankrate.com report, half of American workers didn’t get a “pay boost” in 2019. This includes receiving a raise or taking a job with better pay.

MarketWatch also points out that “crippling debt from student loans, credit cards and/or unexpected medical expenses is also taking a huge bite out of many workers’ take-home pay.”

Consumer debt hit record levels month after month in 2019. As of the end of October, total consumer debt outstanding stood at a record $4.165 trillion. (Seasonally adjusted) Americans owe over $1 trillion in credit card debt alone.

The financial networks usually report surging consumer debt as good news. According to the mainstream narrative, people borrow more when they are confident in their financial situation. Here’s how Bloomberg reported yet another jump in consumer borrowing last summer.

The surge in borrowing indicates Americans, supported by higher wages, were feeling confident enough about their financial situation to continue borrowing and spending. The economy, beset by weakness in manufacturing, housing and capital investment, remains highly dependent on the US consumer to keep driving the expansion.”

This narrative falls apart when you look at the number of Americans living paycheck to paycheck. It’s far more likely that the ever-increasing level of borrowing is because Americans are tapped out and charging everyday purchases on plastic. They’re not only living paycheck to paycheck; they’re borrowing every month just to make ends meet.

The fact that so many Americans are burdened by debt and living paycheck to paycheck is not good news when the economy’s growth depends almost completely on consumer spending. The truth is American consumers have been driving the US economy with money they don’t have. This is not a sustainable economic model.

As Peter Schiff noted in a podcast after the Q2 GDP number came out, this notion that the US economy is strong is “fake news.” Consumer spending increased by 4.3% and contributed nearly all of the GDP growth. Many of the headlines credited the American consumer with “rescuing the economy.”

The problem is if the consumer rescued the economy, who is going to rescue the consumer? Because if you look at where the consumer is getting that money, it’s from credit. Year-over-year, consumer debt has increased by 5%. So, what is driving consumer spending is debt.”

Get Peter Schiff’s key gold headlines in your inbox every week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!

Related Posts

US National Debt Quietly Eclipses $28 Trillion

On March 1, the US national debt eclipsed $28 trillion with no end to the borrowing and spending in sight. It was just last fall that the debt surged above $27 trillion for the first time. In less than five months, Uncle Sam added another $1 trillion to its debt load. And there’s barely been […]

READ MORE →

Go Big on Silver With 1,000-Ounce Bars

Silver enjoyed a moment in the sun when the Reddit investors turned their attention to the white metal. Silver has since faded from the headlines but it remains an attractive investment option. As one portfolio manager put it, sub-30-dollar silver “is the most attractive macro-economic asset in the world.” For investors who want to go […]

READ MORE →

The Danger Lurking Behind Government Digital Currency

China made a big splash when it rolled out its digital yuan and it got a boost when China’s biggest online retailer announced it has developed the first virtual platform to accept the Chinese digital currency. But China isn’t alone in exploring the possibility of digital money. Sweden has developed a digital currency of its own […]

READ MORE →

Government Policy Changes Should Boost Indian Gold Market

Some policy shifts recently announced by the Indian government in its Union Budget will likely have a positive impact on the country’s gold market. India ranks as the second-largest gold-consuming country in the world, second only behind China. The three key policy changes that will likely affect the gold market are:

READ MORE →

Fed Expands Record Holdings of US Debt

The Federal Reserve expanded its record holdings of US Treasuries in the fourth quarter of 2020 as it continued monetizing the massive federal debt. The Federal Reserve added another $253 billion to its Treasury holdings in Q4 according to the Fed’s Treasury International Capital data released on Feb. 16. That brought the central bank’s US […]

READ MORE →

Comments are closed.

Call Now