Quote:
Originally Posted by kane
Here is why the middle class is so important.
Say you are a very poor person. For whatever reason, you are barely getting by. Now, assuming you are not disabled, you can pull yourself out of this. By learning some job skills/getting an education and working hard (or maybe just working hard), you can pull yourself into the middle class where you can have a decent house, car, and life complete with a little extra money you can use to take a vacation or buy a home theater etc. You aren't rich, but you are doing fine. You also now have purchasing power. You will go out and buy things which helps create and maintain jobs.
Now, if the middle class continues to shirk and the wealth gap widens you end up in a situation many shitty third world countries face which is to have a small number of very rich and powerful people and a huge number of very poor people. It will be a hell of a lot harder to pull yourself out of poverty if there is no middle class and the only options are to be poor or rich.
Think of it like a ladder. Poverty is the bottom rung, wealth is the top run, and the middle class is all the middle rungs. It will be damn near impossible to get to the top rung if the only rungs left on the ladder are the top and bottom.
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even if you are basicly right with your "picture" you are kind of unlogic because the middle class can only move to 2 possible directions.
they can become rich or poor.
both of that will not really work and will be self regulated by the logic of markets because of
1. there is no way to stabilize any kind of economy with people who do not have money and people who have all money.
2. there is no economy and no production possible with only low skilled and very high skilled workers - infact we have a problem actually to find the workers for the low skilled works and a need in middle and high slkilled.
3. that leads to the point that the middle class have to be recruited from the poor class in the future. but even this middle class needs the low class same as the high class needs middle and low class to survive.
last not least we always forget what the "middle class" was 50 years ago and what it is today.
if you calculate that on buying power and compare it globally you can see already that the buying power of the so called middle class was 50 years ago similar to the buying power of high class. what have changed are the measurements. fact is that the poors in western countries have more buying power today as the poors 50 years ago.
so we just define the word middle class different because the rich seems to become richer.
but that rich becomes richer is also not really true and just a result of "more money" in the markets.
if you would try to buy all existing goods in the world with the money what is around, you would not be able to spend more than 5-10% of the existing money.
so in fact the rich are owning more money as goods in the world - what gives the word "money" a really different meaning.
money should represent the goods and services you can buy. but that is already past because of not enough inflation and printing money what is not covered by goods.
this is one of the reasons why this kind of discussion does not make sense within a group what does not have the knowledge about money circles and the worlds economy.
it does not even make sense to explain this people that they are living from slavery, because wide parts of their existing buying power is financed by cheap workers in countries where values are different.
the indian who works for 1 dollar per hour is not a poor guy. he is a middle class in his country. he is even able to buy a quite nice house in his country for 10-15 k dollars and is privileged. on the other hand he produces goods in this 1-dollar-hour what are affordable for the low and middle class in the western countries and what brings us prosperity.
in a globalized world you have to understand global economic rules. the ones who donīt want to accept that speak agianst their own prosperity.
the much bigger problem in all that is the LOCAL economy.
the next bubble is already on the way because american economy was heated by additional loans and additional printed money.
this next bubble will not start to explode with real estate - it will start with private loans on cars.
keep this promise in mind and wait 1 or 2 years. than you can buy extremely cheap cars in US from people who canīt pay their loans anymore.
this will infect the car industry in US and it will jump over to all other industries and services.
trump is on the best way to close the one and only door out of that - and this door is called global market.
in the past 6 month USA have lost a lot of his status of the big player in this global market and it will loose more and more because even the president of the USA and his folks do not understand this basic rules.
but they will not be the loosers at the end. the loosers will be the hard working people.