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Americans Are Stressed About Money And Joe Biden Should Fire Janet Yellen
The other day, the United States Treasury Secretary, Janet Yellen, told Congress:
We don’t have to get the prices down. Wages are going up.
The Juice couldn’t believe it when we heard it.
This is the problem with politicians. Particularly the Democratic party.
Their finger is so far from the pulse of what’s actually happening in much of America that it’s laughable.
Maybe the head of the freaking U.S. Treasury hasn’t been paying attention? If you know her email, forward her today’s Juice and the link to all of our back issues. Because the story we’ve been following for roughly two years now is getting “good.”
All of that according to a large SoFi study of employees and employers. Apparently SoFi didn’t share a copy of their report with Janet Yellen.
Meanwhile back at the ranch …
The picture — the writing on the wall — could not be more clear, yet somehow Janet Yellen doesn’t see it. The nerve to make a comment like that when millions of Americans are clearly struggling. It’s just beyond the limits of our comprehension.
Obviously, the story we’ve been telling at The Juice is hitting a tipping point.
We started beating this drum in April 2022. In that Juice, we noted that all four major banks saw some consumers making slower credit card payments.
In May of that year, we laid out the situation for what it was and has slowly become:
So a prevailing theory on why personal savings continues to rapidly erode doesn’t hold water. That suddenly we’re allowed to go out and spend money so we’re blowing all the cash we had saved.
Such an old narrative. For at least the last year, in most parts of the country we’ve had pretty close to a full slate of opportunities for spending. It has felt like the old normal out on the streets for a while now. It ain’t 2020 no more.
Closer to reality – if you’re comfortable financially, you’re spending and saving robustly and concurrently. If you’re not operating from a position of personal financial strength, you’ve blown through your stimulus and any pandemic-accumulated savings. And, thanks largely to high inflation, you’re stretching to make ends meet, making necessities your spending priority.
What Happens When You Raid Your Savings?
You start turning to debt.
It was in that article where we tied the dwindling savings/increasing credit card debt equation to the solid earnings reports from the discount dollar stores.
All we have been doing is connecting the obvious dots. Seeing how one area of the economy ties to another. While we think we’re good, we also realize that this isn’t all that hard. Most of the media never seemed interested beyond reporting the headline number because the story is a slow one to develop. If it’s not sexy, they don’t care.
But the Treasury Secretary? C’mon. At least, don’t make such lame and, frankly, insensitive comments.
For lots of people, wages aren’t going up. And, if they are, they haven’t gone up enough to meet and beat the increased cost of living on almost everything. Here, again, it couldn’t be more evident. But, according to a key government official, it’s all good. Don’t expect prices to come down, and that’s okay. We shouldn’t worry about prices.
Joe Biden needs to take Janet Yellen’s badge. Yesterday.
The Bottom Line: You might ask, why does this matter? Because lots of people are doing well.
We agree. We see them too.
However, if a solid chunk of the people on the frontline in America — our workforce — are so stressed about money that it’s impacting their mental health. If they’re dealing with credit card debt that keeps from comfortably making ends meet and having an emergency fund. You have to ask yourself, is this the kind of country you want to live in?
Even if the individual-level plight doesn’t matter, realize that this is going to hurt the companies these people work for, if it hasn’t already. A stressed, unhappy and unhealthy workforce is bad for America at any level.
And, as the data shows, this directly impacts the long-term concern and our 2024 focus on retirement. A focus we continued developing in yesterday’s Juice and we’ll keep developing further in the days, weeks and months to come.
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