People have triple the debt and less than half the savings compared 2 last time unemployment hit 10%

[Liberal_in_LA]

:wow: :scared: :wow:


Jobless hit particularly hard

Jeannine Aversa, Associated Press

Sunday, November 15, 2009

It hurts more to be unemployed now than the last time the jobless rate hit 10 percent.

Americans have more than triple the debt they had in 1982, and less than half the savings. They spend 10 weeks longer off the job. And a bigger share of them have no health insurance, leaving them one medical emergency away from financial ruin.

For these reasons, the unemployed are more vulnerable today to foreclosure and bankruptcy than they were a generation ago.

Donald Schenk knows. He has been without work both times. It's worse now, he says.

Back in the early 1980s, when Schenk lost his job at a phone company, he was able to find several temporary jobs - including one testing pinball machines - to make ends meet until he landed full-time work nearly two years later.

But now, Schenk, 55, of the Chicago suburb of Schaumburg, Ill., has been seeking work for a year and a half after losing his information-technology job. Potential employers aren't interested "if you are not a perfect fit," he says.

--------

"It will scar a generation of kids," he says.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/11/15/BUUE1AGHTJ.DTL&type=business#ixzz0Wz2qjr2K

[tyne]

1. Ya, people

have a lot more debt because they bought more things that they couldn't afford.

The first part of this decade was all about running up credit and spending fake equity. Increased wages were eaten up by increased health care/insurance costs.

Of course not all....but.....

[Greyhound]

2. I think that overall may be more PR than reality. n/t

[tyne]

3. How so?

[Greyhound]

8. I'm speaking of the various blame-the-victim talking point still making the rounds.

I lived in LA during most of the run-up to this disaster and what I saw was people being eternally squeezed between plunging wages and increasing expenses, so they turned to credit to get by until things got better. Of course there were some people that did as you indicated, but I believe that most were simply struggling more and more to make ends meet.

Things never got better.

[laughingliberal]

4. In 1982 we had not been through over 2 decades of declining wages

and rising health care costs. It is much more serious this time.

[tyne]

5. During

the better part of the decade, we didn't spend like it was serious. We acted like we had money to burn.

[laughingliberal]

6. However you want to see it. I graduated nursing school in 1982

and spent my entire working life working harder every year just to stay in the same place. Eventually, no amount of pushing could keep me there and, despite increased work loads and one of the best knowledge bases in any organizations that employed me, I found my standard of living lower than when I graduated. After the takeover of health care by the for profit industry, nurses were screwed.

[tyne]

7. I've no doubt

that what you say is true. I'm not disputing that.

All I'm saying is that....I'm 49 and I watched, during the middle 00's(LOL)...my friends spending like there was no tommorrow. Borrowing on the 401k's (using it to pay off their credit card debt)...and borrowing the fake equity in their homes for the same thing. Savings accounts during this time were MINUS ZERO.

It's no wonder we're in the shape we're in. And, thank God, consumption is down....actually the savings rate is up...and people are living a little bit more in the real world again.

That's healthy and it's going to take some time for this new economy to take hold.

[laughingliberal]

9. Whatever. My consumption is certainly down. Most days we eat, now.

And we are still managing to get enough gas in the car to get us to a job site. You know, when we have work. Aren't saving anything but are grateful we still sleep indoors, for now. I am sure there was overspending but a lot of the use of credit cards, etc...we hear about is due to the stagnating wages. People were falling further behind over time. Wages did not keep up with health care costs or increases in housing or cars. Instead of raises, people had credit. And were going into debt just to keep their heads above water. Can't speak for your friends but I think the bigger problem here is the destruction of the working class. I still remember how it was before Reagan. And the problems are much deeper than people who spent too much on their toys.

[FarCenter]

10. Unemployment may go to 13%

There was a guest, David Rosenberg, chief economist at Gluskin Sheff & Associates Inc. in Toronto on Bloomberg radio.

He predicted that unemployment will reach 13%, since employers will start lengthening the workweek for employees already on the payroll instead of hiring new employees. Thus, the layoffs will continue at near current rates while hires stay depressed. This will cause the U3 unemployment rate of 10% to rise towards the U6 unemployment rate of about 17% and close the current gap between them, which is unusually wide.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aRC3r3unP3D8