Author: Michael Douville
Homelessness is rising in America. It is going to be worse; much worse. Over 400 “Tent Camps’ have sprung up in the Seattle Area, people are sleeping along walkways, under overpasses, and throughout urban parks; anywhere that might offer a degree of shelter and safety. Over 168,000 people are estimated to be Homeless along the West Coast. In September 2016, almost 58,000 New Yorkers slept in the 5 Burroughs shelters just one cold night. Over 50% of Public School Children qualify for the School Lunch program providing Breakfast and Lunch; often, the only food the children will receive for the day. Indeed, 47% of Americans report feeding their family is a daily concern. Over 1.5 Million American families supplement their diets with visits to the local Food Banks which are already feeling the pressure. These Americans did not start out Life dreaming of Homelessness as a Life Goal. They did not Prepare, they did not Plan. How many Americans are 1 or 2 paychecks away from living under the Bridge?
The data and charts show that huge numbers of Americans are living well beyond their means. As the availability of Credit at low teaser rates has been expanded, many, many families have indulged in artificially raising their Living Standard by going into debt to supplement their Income; going into massive debt to buy unnecessary things and keep up appearances.
Obviously the counter trend of massive personal debt is an extremely low Savings Rate. Once the Credit Lines have been maximized, misery sets in as years of paying for past indulgences lies ahead. Credit Cards, Auto Loans, School Loans, and Home Equity Lines of Credit (HELOC) doom the debtor. Surveys reveal 46% of Americans cannot even afford $400 in Cash for an Emergency. When all of the Reserves are gone, any calamity jeopardizes the Family.
The Economy has not yet turned down, but some forecasts are indicating it may soon. There may still be time to build reserves, pay off debt, and cut expenses. Should a Recession arrive, and it is inevitable that it will, Income and Revenues will be endangered. Survival will be paramount; survival for those with Capital will build Fortunes. Those that have purchased Income Producing Assets will benefit from the climatic changing Economic Environment and have built their “Lifeboat” will fair much better than those that are over-leveraged and debt laddened,
Economic Turmoil is coming, it is not IF, but WHEN. The Cycles of Real Estate and Commodities will supplant the Aging Cycles of both Stocks and Bonds. Those that take heed and Prepare their Finances will weather the Economic Storm, Protect their family, and have the Opportunity to build Generational Wealth in just a few short years. Those that do not heed or prefer to do nothing, will SUFFER. Perhaps the last of the credit line should be used for Camping Equipment!
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