Las Vegas real estate and the dynamics of a lower priced housing market – With median home prices around $100,000 they now reflect the reality of a lower paying service sector economy. Foreclosures and short-sales make up over 70 percent of all sales activity.
Las Vegas is a case study in the limits of the housing bubble but also the reflection of a new economy driven by a demand for lower price real estate. Wedged in the story of a collapsing real estate market is a new reality that many families are craving lower priced properties. Few places in this country benefited so much from the rising price of real estate like Las Vegas. When things turned dramatically the market was left relying heavily on two industries, gaming and real estate, that profoundly relied on a booming economy but also on unlimited access to debt. Las Vegas has the highest percentage of its homes in foreclosure and has also seen some of the steepest price falls from any large metro area in the country. It is fascinating to see that roughly half of all purchases over the last few years have come from investors. The trend seems to reflect a demand for low priced housing either for investing or for those living in the area to purchase a place with a much lower household income because of the recession. What does this mean for the future of the city?
Is college worth the money and debt? The cost of college has increased by 11x since 1980 while inflation overall has increased by 3x. Diluting education with for-profits. and saddling millions with debt.
Is a college degree worth it? Since the debt bubble burst spectacularly in 2007 many more prospective students are questioning the worth of a college degree. For so many decades it was simply taken at face value that getting a college degree, any college degree would be worth it. Slowly this perception has morphed when annual tuition is running at $20,000 or more at for-profit institutions and $50,000 for private institutions. More to the point, most of the recent educational growth has been financed with large wallet crushing student loans. This financing of the college dream is turning out story after gut-wrenching story of college education nightmares. When a college education becomes this expensive it is important that potential students become savvy consumers. The financial sector certainly isn’t going to offer any advice on navigating the minefield of higher education since they largely have their greedy hands on this sector of the economy as well.
Welcome to the new model of retirement. No retirement. In 1983 over 60 percent of American workers had some kind of defined-benefit plan. Today less than 20 percent have access to a plan and the majority of retired Americans largely rely on Social Security as their de facto retirement plan.
As many Americans enter into retirement they are realizing one unfortunate thing. The new retirement plan is no retirement at all. Over the last few decades Americans were promised the idea of a comfortable retirement yet none of this has materialized because of financial swindling and a real estate bubble that will go down in the record books. On the flip side, many Americans went into massive debt and consumed their future nest egg today with big purchases outside of their budgets. So what are we left with today? We are left with over 75,000,000 baby boomers entering into retirement with very little saved. One out of three Americans has absolutely no money saved to their name. In 1983 over 60 percent of working Americans had some sort of defined-benefit pension plan. Today that number is below 20 percent. With the average worker making $25,000 a year the media designed idea of retirement is largely just another fantasy.
Kabuki financial theatre – Congress net worth up 15 percent from 2004 to 2010 while the average American sees their net worth decline by 8 percent in the same timeframe. Welcome to plutocrat USA.
We truly have the best government money can buy. From 2004 to 2010 members of Congress increased their median net worth by 15 percent while the average American saw it fall by 8 percent. Yet this fall in net worth does little justice to the rising cost of food, energy, healthcare, and college expenses that have eaten away any iota of progress families try to achieve in a prosperous nation. The fact that Congress presided over a Wall Street pilfering of the middle class and income inequality never seen in the history of the United States, we are starting to get a full understanding of what it is to live in a full-fledged plutocracy. The reason people are frustrated with government is that it no longer looks out for their own interests and is narrowly focused on promoting the aggregation of wealth into fewer and fewer hands.