Annihilation of Middle Class
The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK (TheStreet) -- Having made a point of closely monitoring mainstream economic propaganda, a number of obvious tactics are used repeatedly. One of the most popular of these tools of deception is to lie by "redefining" terms.
In this case, the propagandists at Reuters are endeavouring to hide the annihilation of the U.S. middle-class through their very clumsy effort at redefining the word "affluent." The context of the article was an attempt by Reuters to continue to portray the U.S. as the world's "most affluent" nation. However, any realistic examination of their data must lead to a nearly opposite conclusion.
How does Reuters choose to define "affluent?" It considers any household with a net worth of merely $100,000 to be "affluent." In order to avoid being guilty of the same offense as Reuters, let me be more careful in my own efforts at definition.To begin with, note that Reuters uses the term "household," rather than "family" or "individual." On the one hand, this means that the "net worth" figure it quoted is not a per capita statistic. On the other hand, it also does not apply to the stereotypical family of four. Some "households" consist of single individuals, some being childless couples, and some being actual families, while a "household" would normally be thought of as (approximately) a two-person unit. This requires a brief caveat. Since the onslaught of the U.S.'s Greater Depression, families and households have become "extended" -- as millions of Americans impoverished by job losses are forced by economic necessity to move in with other family members. Thus considering a household to be a two-person unit is a very conservative figure, and becoming more so by the day. So when Reuters is talking about "U.S. affluence," it is basing that label on a paltry, per capita net-worth of only approximately $50,000. Personally, when I consider the "affluent" people whom I know, I would estimate that the vast majority of these individuals have $50,000 worth of "stuff" alone -- i.e. their basic personal possessions (including cars), but not including home-equity, retirement savings, and other savings/investments. All the "affluent" people whom I know would have a net worth of several (many) multiples of that $50,000 figure.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV