Where is the US economy headed?

c.i. :
i may start "naming names" - watch out ! <GRIN>
hbg

A good disposable income, that is a good paycheck, and a debt load that they can manage. Before lots of people were spending capital gains or debt, and almost no one can do that now. Those with old fashioned jobs with a living wage are golden now. However, not knowing what will happen to the job many are squirreling away money rather than spending it. Sometimes the low prices change our minds though, for instance have you looked at airfares lately? Sometimes this stuff is too good to pass up.

Who "exactly" are those people? From my readings, most have lost a good percentage of their assets in their homes and 401ks. I want some specifics on who you are talking about - those with good paychecks and debt load that they can manage? Where are they, and who are they?

you want names?? I am making a general statement not related in individual situations. However, there are lots of people with good paying jobs who over the years have been prudent with debt and who do not need to spend capital gains in order to have a high standard of living. Not everybody leveraged their family accounts using their home as a piggy bank and maxing out their credit potential.

For instance anyone who over the years has signed on to Dave Ramsey's program today find themselves a master of the universe if they have a good job.

Come on, hawkeye, you should know better. I can provide names; I want industries or districts/communities/counties that have what you said about

Where are these people you say exists today?

<raises hand>

Cycloptichorn

it is not broken down by geography or industry. The dividing line is between those individuals who over the years practiced financial good sense as it was known by those who lived though the last depression, and those who chased wealth creation as was taught by those who came out of the business schools after that. If those people have also managed their careers well and now find themselves with good pay and in a job that is low risk for elimination then they are golden. My wife for instance has an Army paycheck, her job aint going anywhere. I work in the public sector, my job aint going anywhere.

Now, you're going global on me! I thought you meant today's workers. Sorry for my misunderstanding.

I am working today, my wife is working today....

Oh, great! Anecdotal now.

If you want to talk about personal experience in today's economy, I've been retired for over ten years now, and still have more retirement savings than we put in. How that translates into generalities about our economy is an oxymoron. Even Warren Buffet lost 55% in his Berkshire Hathaway during the past 52 weeks. Get my drift?

I am in rare agreement with Hawkeye. The folks who are going to come out of this smelling like a rose are in their early 30's to mid 40's. Not all of them, of course:
(1) People who use their credit cards because it is more convenient than carrying cash. Peolple who don't care if the interest rate on unpaid balances is 10% or 30%. They pay their bill by the due date.
(2) People who have jobs in industries like the military or other aspects of government or health care or... Us old farts will be retiring in big numbers in the next few years. Big opportunity for advancement.
(3) People who DIDN'T buy over-priced McMansions in the suburbs and felt they had to have an SUV to go with it. Instead they bought in an urban area or, perhaps, rented rather than bought (gasp). If an opportunity came up somewhere else, they had the flexibility to move.
(4) If 1-3 are correct these fols may have some disaposable income which could go into 401-K and/or Index funds.

They, I think, will be the ones to fare well.

That describes me to a T.

Cycloptichorn

prudence is the key here: for instance those who bought near vibrant cities are seeing their home values hold out better than those who bought a long commute away or in the slummier parts of the country. I bought a house near the interstate next to a big city and with-in a mile of major shopping areas in a subdivision with a strong homeowners association and a block away from a bus stop.....my house value has held up far better than who bought at the same time but who tried to by the most home they could for the money, which usually meant in a not great neighborhood or in the boonies.

as an added beenie there are no foreclosures that I am aware of in my neighborhood, which when they happen drag down the values for all. Location, location, location

All these anecdotal experiences doesn't support your original claim about savings and security. Probably the only people who are secure in their jobs today are either in the medical field or are in the teaching profession. That hardly speaks to the majority of people losing their jobs today, nor the security they have - even in the 30 to 40 year old range.

What percentage of the population do you think your anecdotal experience represents? 10%? Hardly enough to provide confidence in the majority of workers today.

I live in and work in a community largely made up of public sector employees, your 10% theory seems very lowball to me.

14% are unemployed or under employed, even if you figure that a lot of fully employed people don't have a living wage there still are a lot of people who do.

Hey, one can make more money than in investments by periodically moving the credit card debt around to low interest card deals, then move it around again when its about to be raised. The banks have tightened up recently on what they offer -- last year, Chase offered a permanent 2.99% on paying off other cards, Schwabb 1.99% for one year. Now it's from 4% to 6% and shorter time and higher interest when the time gives out. Still, if anyone used a card for major purchases, it's better than 10% interest.

You are right that those on fixed incomes in their twilight years are not faring well, but if they pull out all the money if they don't need it from lifetime investments, they'll do worse. That will bounce back in the next three years.

BTW, you really have to have three cards with a really good credit rating in the 8's to do this.

Many government workers are getting their hours reduced or getting laid off from their jobs including state, county and city employees. They've all been showing huge deficits from several years ago, but failed to save for a rainy day.

Most pension funds lost huge amounts of money, and those retiring soon may see their benefits cut. Many companies that are going bankrupt also affect those with lifetime health care insurance which is being drastically reduced or lost.

I'm afraid I don't see a whole lot of positives today in our economy. I see more downside than upside; maybe that's my perception problem.

My credit card FICO score is 818.

One positive is that smart people who understand risk and who are willing to plan are doing better than those who don't. When smarts and hard work are rewarded that is a positive.

I think that our little disagreement here has to do with you using as a yardstick the boom-boom leveraging of debt years (1980-2008) and I am talking about who will do relatively well in the future. We are as a society moving down the standard of living ladder, we are a superpower on the way down and our economy will reflect that even after this crisis passes in a couple years or ten or twenty. Winners will be those who do better than the rest, not those who do better than the ideal that you have in your head.