US Average Earnings Fall In Worry For Fed

Wages should be linked to productivity of the wage earner and demand for their services CPO Tim Dickey Unfortunately some people want to decouple wages from productivity because they want everybody to get a pay raise. this is why some misguided folks push for an increase in the minimum wage without understanding it causes businesses which operate I=on the margin to reduce hiring or go out of business.

Unfortunately, the government periodically changes how they compute inflation to make whatever party is in power look good. So we've got changing metrics. So when something good happens, we can't figure out how. It's like target practice where we blindfold you, give you a moving target, and randomly select your weapon from grenades, pistols, howitzers, fixed wing air, and pea shooter. By the way you're limited to a circular probable error of 3 inches. All clear on the right! All clear on the left! All clear on the firing Line.

Here is the crux of the whole matter. A new house cost 1050% more in 2006 than in 1970. That means a new house in 2006 was 10 ½ times more expensive than one in 1970. By comparison, the median household income increased 452% between 1970 and 2006. The 600% difference between income and housing expense is why there is a crisis of monumental proportions plaguing this country.

America cannot handle what is happening in the housing market. The only way would be to hike wages dramatically. If that were to happen, we would be back to the days of 13% inflation. The only solution is for the housing costs to come back down to a level commensurate with income.

To put these statistics in proper perspective; a new home would cost the average family on average three times its annual income. So, today the average income in the U.S. is $51,939 so to correct the problem the average new home needs to be around $155,817 which currently it is $311,400.

Again, I'm not expert but the housing bubble is still here even after the small correction. Every day in America someone signs their life away just to purchase a grossly overpriced piece of the American dream.