Treasury secretary Hank Paulson says the crisis is over, and maybe it is–for Wall Street. On Main Street, of course, the bad news just continues to roll in. On an inflation-adjusted basis, American consumers are getting poorer by the minute–especially now that their houses are no longer self-replenishing ATMs. NY Post:
US workers are facing a nearly unprecedented belt-tightening as real wages are likely to fall for the eighth straight month in May while declining home values and a lackluster jobs market have cut off two traditional ways they could get some breathing room.
The ever-shrinking buying power of consumers was totally dismissed last week when the US labour Dept. put a rosy spin on a less-than-expected rise in inflation for April – saying prices rose just two-tenths of a per cent instead of the expected three-tenths of a per cent.
Whoopee, said economist Jared Bernstein, of the Washington-based Economic Policy Institute.
“When it comes to their living standards, many working people are facing a perfect storm: higher prices, squeezed paychecks, and the fall in the price of their most valuable assets, their homes.”
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