While the U.S. has technically been out of recession for the last four years, most people would be hard pressed to see any improvement. Unemployment numbers have remained high. And more and more people are dropping out of the workforce. Because of the way the government accounts for labor participation, the actual unemployment numbers should be much higher.
Of course the scenes that were so common in the Great Depression of the 1930′s are nowhere to be seen. Soup lines are a thing of the past. Instead of having to wait in line for food, we simply direct deposit food stamp money into individual bank accounts. This creates the illusion that things are much better than they seem.
But for most middle class Americans, this is the most difficult time in recent memory. While the stock market is setting new highs every single day, average wages are declining. Additionally average hours per week are steadily declining as well. This means that companies are slowly but surely cutting back on their employee’s salaries.
When this is added to the higher taxes associated with ObamaCare, people are making significantly less than they used to.
This doesn’t even take into account inflation. While the government states that inflation is a tame 1.5%, anyone who has been to the grocery store in the last couple of years knows this to be complete fallacy. Many staples such as milk are higher in price to the tune of 35%. This is obviously not insignificant.
Many household items are increasing in price as well. Room darkening shades are slowly creeping up in price. So are things such as household cleaners, detergents, and other necessities. In fact some prices are up more than 100%.
Some manufacturers have created some interesting tactics to deal with this. A couple of years ago, while in the checkout line, I noticed the clerk mention that the orange juice carton I was buying was slightly smaller than what she remembered. But the price was the same. Turns out she was right. Rather than raising the price, to which consumers are very sensitive, they made the container smaller. I probably never would have noticed. This practice is not uncommon.
Makeup is another area in which price increases have been significant. The best under eye concealer that my wife has found recently increased in price by 15%. This is not an insignificant increase on a product that costs $50.
And when things don’t seem like they could get any worse, just wait. Because of the fiscal policies of the Federal Reserve, retirement savings are slowly being eroded as well. As of right now, the Fed is creating upwards of $85 billion per month. The definition of inflation is an increase in the money supply. And that’s exactly what they’re doing. In order for the government to service the massive debts they have created, they are creating more and more money out of thin air. All this has the effect of making every dollar you earn and own less valuable.
Many people are turning to hard assets such as gold, silver, and real estate in an attempt to protect themselves from this policy. It’s probably a good idea for you too.