Fred Harteis News Articles- The statistics are grim: Inflation is at a 17-year high. Unemployment is rising. Foreclosures are spreading.
For many, however, these figures are simply numbers. They are still gainfully employed and paying their mortgages. Sure, they are shelling out more for gas and groceries, which might prompt them to skip a movie or a dinner out. But overall, they are still better off than they were when America's last recession ended in November 2001.
For others, of course, the picture looks much different. They are the statistics. These are the people who have lost their jobs and are struggling to hold onto their homes. Soaring prices at the pump and the supermarket have shattered any hope they can crawl out from under their debt. There's no question they are worse off than they were seven years ago.
Are we better off? It is one of the signal questions of the presidential election, and both Republican John McCain and Democrat Barack Obama are asking voters to ponder it.
There's no single answer. Economists can argue the matter either way, depending on the figures they point to. But for most people, the answer depends on their personal situation.
That's where you come in.
So how do you determine whether you are better or worse off, especially in the face of today's crumbling economy? Here are things you can think about to determine your situation.
Employment: The foundation of most people's economic well-being is their job. Are you still employed and is your job relatively secure? If you've lost your job, will it be hard for you to land another?
On a national level, the unemployment rate is on the rise, hitting 5.7% in July, which is just where it was in late 2001. But the jobless numbers usually climb for months, if not years, after a recession ends. It took until June 2003 for unemployment to hit its peak at 6.3% the last time.
Income: Even if you've held a steady job since 2001, you may have seen your wages go down or remain flat relative to inflation in recent years. Is your take-home paying going as far as it used to? Have your hours at work been cut? If you switched jobs, were you forced to take a lower-paying one because you couldn't find anything else?
Nationally, income has not kept pace with inflation since the last recession ended. In fact, workers' median weekly earnings slipped to $723, down 1.2% from $732 since the end of 2001, in inflation-adjusted dollars, according to Jared Bernstein, senior economist with the Economic Policy Institute.
Housing: The crumbling housing market is at the root of much of the current economic instability. Some homeowners, particularly those who bought in the past three years, are seeing steep drops in the value of their properties. Nearly 30% of people who bought homes in the past five years owe more than the house is worth, according to Zillow, a real estate Web site. At the same time, many are facing jumps in their mortgage payments as their rates reset. Anyone in this situation, obviously, is feeling the pain. But overall, homes are still worth more than they were in 2001. Home prices nationwide are now where they were at the end of 2004, according to Zillow, even though they are down 13.3% from their peak in the second quarter of 2006.
Source: Cnn.com
About Fred Harteis: Fred Harteis leads Harteis International. Fred Harteis has a background in agriculture and has created many successful business ventures.