Friday, March 20, 2009

Financial fears grow. More consumers are just a paycheck or two away from ruin.

This is American news and the Americans always do things twice as big as in the rest of the world. It seems that shanty towns are now common in big US cities. The Greater Depression is coming with a vengeance. There is only one protection and that is physical gold. Not paper gold. For the last 3000 years gold has been the store of value of last resort. Who am I to argue? 1 + 1 = 2.

Financial Fears Grow. More consumers are just a paycheck or two away from ruin
By Jennifer Waters, MarketWatch
Last update: 7:03 p.m. EDT March 18, 2009

CHICAGO (MarketWatch) -- Americans are in a collective state of financial depression as many admit they could only cover their bills for two months at most if they found themselves suddenly jobless, a nightmare more and more worry may come true.

The results of a bevy of surveys found a growing number of consumers are only a couple paychecks away from a household collapse even as many scramble to shore up savings. Rainy-day funds appear to be a distant memory as households burn cash to cover food and energy bills as well as mortgage and car payments.

A large number of households say that even one missed paycheck would spell financial ruin. And even in households that remain well off, the surveys show a festering fear that financial problems are lurking.

"This is flashing so bright red," said Paul Ballew, senior vice president of Nationwide Insurance Co. "Roughly 60% of the population was ill-prepared (financially) before the meltdown."
A MetLife study released last week found that 50% of Americans said they have only a one-month cushion -- roughly two paychecks -- or less before they would be unable to fully meet their financial obligations if they were to lose their jobs. More disturbing is that 28% said they could not make ends meet for longer than two weeks without their jobs.

And it's not just low-income earners who would find themselves financially challenged.
Twenty-nine percent of those making $100,000 or more a year said they would have trouble paying the bills after more than a month of unemployment.

Meanwhile, more than four in 10 respondents told pollsters in a recent Pew Research Center study that job-related issues were the nation's most important economic problem.
"Since October, mentions of other major economic issues have declined, as the public is increasingly focused on the job situation," according to the Pew study.


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