Economic Disaster - Are You Next?

Economic Disaster

Are You Next?

Michael Collins

The human costs of the U. S. financial crisis are coming into clear focus.  Family members lose their jobs, then their homes, and the cascade of ruin begins in earnest.  Health problems are ignored, anxiety and depression increase, and domestic violence is more common.  Many are on the edge, anticipating their worst fears:  losing their home or apartment then struggling to find the next meal.  The biggest issues right now are about basic needs -- food and shelter.

There's a rational, reasonably immediate solution to a good part of the economic disaster.  The banks won't like it but you will.   But first the sad facts.

There were 2.3 million default notices to homeowners in 2008, up 80% over 2007.  It will be worse in 2009 with Option ARMs coming due (those favorites of Alan Greenspan).

Typically the nation's economic leader, California, saw foreclosures increase by 160% in 2008.  As a result three percent of California homes, 240,000 in all, became bank properties.  These are the same banks that slithered up to the bar and demanded a double shot of the new elixir for failed financial institutions, federal bailouts.  Put it on the tab.

To understand the full extent of the economic collapse, consider this.  The current official unemployment rate is 7.2%.  This includes those out of a job who have actively sought employment in the past four weeks.  But this figure understates the level of economic distress.  There are 1.9 million unemployed "marginally attached" workers not counted and 8.0 million underemployed workers seeking full time employment.

The total unemployed and under employed figure is 21 million U.S. workers.

Michigan, Florida, Ohio, and South Carolina are facing hard times similar to those in California.  Your state is next.  It's a nationwide phenomenon.

Despite hundreds of billions in give aways to the banks, there are no reports of a single U.S. citizen or family receiving a bailout from Washington to help them stay in their home.

What happens when you're thrown out of your home or apartment and you have no job?

To begin with, you're poor.

You can live on the street, move in with relatives, or seek to rent a home or an apartment.   After a foreclosure, your credit rating will probably disqualify you from most opportunities at the outset.   If you're in a warmer climate, you can live in a tent city which began springing up across the country last September.

You can and will enter an entirely new world where you're exposed to a variety of risks that will make it very difficult to put your life back together again.  Crime, infectious diseases, underpayment for work, and increasing social isolation are routine.

 1  |  2  |  3