Statists are responsible: One Third Of U.S. Households Can No Longer Afford Food, Rent And Transportation

While the Fed has long been focusing on the revenue part of the household income statement (which unfortunately has not been rising nearly fast enough to stimulate benign inflation in the form of nominal wages rising at the Fed's preferred clip of 3.5% or higher), one largely ignored aspect of said balance sheet has been the expense side: after all, for any money to be left over and saved, expenses have to surpass income. However, according to a striking new Pew study while household spending has returned to pre-recession levels (the average household spent $36,800 in 2014) incomes have not.

Specifically, while the median income had fallen by 13% from 2004 levels over the next decade, expenditures had increased by nearly 14%. But nobody was more impacted than the one-third of households which the study defines as "low-income." Pew finds that while all households had less slack in their budgets in 2014 than in 2004, lower-income households went into the red by over $2,300.

In other words, approximately one third of American households were no longer able to cover the core necessities - food, housing and transportation - with average income.

According to Pew, households spent more in 2014 than they did in 1996, after adjusting for inflation; this holds whether the figures are based on averages (means) or medians. The typical household saw its expenditures grow by more than 25 percent, from $29,400 in 1996 to $36,800 in 2014. Mean expenditures grew 27 percent since 1996, rising from $43,200 to $54,800.

Statists are responsible: One Third Of U.S. Households Can No Longer Afford Food, Rent And Transportation Fig_2_Expen_0

Statists are responsible: One Third Of U.S. Households Can No Longer Afford Food, Rent And Transportation Fig_2_Expen_0

More: http://www.zerohedge.com/news/2016-03-30/attention-president-obama-one-third-us-households-can-no-longer-afford-food-rent-and

Statists are responsible: One Third Of U.S. Households Can No Longer Afford Food, Rent And Transportation

Statists are responsible: One Third Of U.S. Households Can No Longer Afford Food, Rent And Transportation

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