19 Signs That The U.S. Consumer Is Tapped Out

Tyler Durden's picture

Submitted by Michael Snyder of The Economic Collapse blog,

You can't get blood out of a rock.  Traditionally the United States has had a consumer-driven economy, but now years of declining incomes and rising debts are really starting to catch up with us.  In order to have an economy that is dependent on consumer spending, you need to have a large middle class.  Unfortunately, the U.S. middle class is steadily shrinking, and unless that trend is reversed we are going to see massive economic changes in this country. 

For example, in poor neighborhoods all over America we are seeing bank branches, car dealerships and retail stores close down at an alarming rate.  If you didn't know better, you might be tempted to think that "Space Available" was the hottest new retailer in some areas of the nation.  On the other hand, if you live in San Francisco, New York City or Washington D.C., things are pretty good for the moment.  But as a whole, the condition of the U.S. consumer continues to decline.  Incomes are going down, the cost of living is going up, and debts are skyrocketing.  The following are 19 signs that the U.S. consumer is tapped out...

#1 Real disposable income per capita continues to fall.  In the fourth quarter of 2012, it was sitting at $37,265.  By the time that the fourth quarter of 2013 had come around, it had dropped to $36,941.  That means that average Americans have less money to go shopping with than they did previously.

#2 In January, real disposable income in the U.S. experienced the largest year over year decline that we have seen since 1974.

#3 As disposable income decreases, major retailers are closing thousands of stores all over the country.  Some are even calling this "a retail apocalypse".

#4 From September 2013 to January 2014, the personal saving rate in the United States dropped by a staggering 16 percent.

#5 During the fourth quarter of 2013, we witnessed the largest increase in consumer debt in this country that we have seen since 2007.

#6 Fewer Americans are applying for mortgages these days.  In fact, the MBA Purchase Applications Index is now the lowest that it has been since 1995.

#7 Overall, the rate of homeownership in the United States has fallen for eight years in a row.

#8 Many Americans are finding it increasingly difficult to afford a new car or truck.  The following comes from a recent CNBC article...

A new study shows the average household in 24 of America's 25 largest metropolitan areas cannot afford to pay for the average priced new car or truck.

"Just because you can manage the monthly payment doesn't mean you should let a $30,000 or $40,000 ride gobble up such a huge share of your paycheck," said Mike Sante, managing editor of Interest.com. "Many people are spending money on a car payment that they could be saving."

#9 Incredibly, 56 percent of all Americans now have "subprime credit" at this point.

#10 Total consumer credit has risen by a whopping 22 percent over the past three years.

#11 In the third quarter of 2007, the student loan delinquency rate was 7.6 percent.  Today, it is up to 11.5 percent.

#12 Overall, U.S. consumers are $11,360,000,000,000 in debt.

#13 While Barack Obama has been in the White House, median household income in the United States has fallen for five years in a row.

#14 U.S. workers are taking home the smallest share of the income pie that has ever been recorded.

#15 One recent study found that about 60 percent of the jobs that have been "created" since the end of the last recession pay $13.83 or less an hour.

#16 Middle-wage jobs accounted for 60 percent of the jobs lost during the last recession, but they have accounted for only 22 percent of the jobs created since then.

#17 According to one recent survey, only 35 percent of all Americans say that they are better off financially than they were a year ago.

#18 In 2008, 25 percent of all Americans in the 18 to 29-year-old age bracket considered themselves to be "lower class".  In 2014, an astounding 49 percent of them do.

#19 The poverty rate in America has been at 15 percent or above for 3 consecutive years.  That is the first time that has happened since 1965.

Despite what the mainstream media keeps telling them, most Americans know on a gut level that there is something fundamentally wrong with our economy.

According to Gallup, "Unemployment/Jobs" is the number one issue that Americans care about these days and the "Economy in general" is the number three issue that Americans care about these days.

Most people just want to work hard, make a decent living and take care of their families.

Sadly, that is becoming increasingly difficult to do.

And the numbers that I have shared above only tell part of the story.  For a more personal side to all of this, I encourage you to read my previous article entitled "10 Stories From The Cold, Hard Streets Of America That Will Break Your Heart" if you have not done so already.

The really bad news is that this is about as good as things are going to get for the U.S. economy.  The long-term trends that are eating away at our economy like cancer are intensifying, and our "leaders" just continue to act as if "business as usual" will somehow get the job done.

Most of them don't even realize that time is running out.

As I discussed yesterday, there is a lot of evidence that the massive financial bubble that the Federal Reserve has inflated is getting ready to burst.

When the next great financial crisis does strike, it is going to be absolutely disastrous.  We are in far worse financial shape than we were back then, and this next round of financial trauma could truly be the "knockout blow" for the U.S. economy.

Let us hope for the best, but let us also prepare for the worst.

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LetThemEatRand's picture

The problem with our economy is that the large corporations and banks own it.  I'm in Phoenix tonight, having spent the last two days doing some work here to build my small Florida business.   Spending cash on the trip because getting a decent line of credit these days for a small business (even with a good track record) is near impossible.   Funny, because the Fed is feeding almost $100B a month to the large banks.

Mister Kitty's picture

I'm tapped out, too.  I'm a broke dead dick.  Bitches.

dow jones 20000's picture

Linking to your blog doesn't make it any better.

Shocker's picture

Consumers are spent. Good Paying / Benefit Jobs are being replaced with Low Pay / Benefit Jobs.

It eventually will have an effect on the economy

Layoff / Closing List: http://www.dailyjobcuts.com

-

johnQpublic's picture

do people never adjust and attempt to live within their means?

i was 29 before i owned my first new car

the list price was just under 9 grand

if you live a bit below your means, life is easier

NoDebt's picture

You may find yourself living in a shotgun shack

And you may ask yourself, how did I get here?

Answer:  The Fed and Washington, DC decided long ago that a vibrant middle class is too damned dangerous to them and a shotgun shack is good enough for "the people".  Nobody cares the state of the empire over which they rule so long as they rule over it absolutely.

I used to live beyond my means.  Didn't work out so well.  I bucked down, paid off debts and began living well below my means.  I still do.  But now it's mostly to stay off the radar, not because I'm planning for some triumphant return to a more extravogant lifestlye.  I just don't feel like being that big a tax/confiscation taget.

Rafferty's picture

Counter-intuitively, revolutions have usually emerged from the middle and lower middle classes. Our leaders know this.

mkucstars's picture

They are not afraid of the middle class, they just don't need them anymore. Machines don't need benefits or vacations, you've been replaced.

PT's picture

Well contgratufuckinglations.  Good for you.  I also live within my means.  And if the whole world did it then the world economy would grind to a halt instantly because for a long time I never bought anything.  And by the sound of it, neither did you.  On the plus side, this might force a positive change to more suitable world pricing mechanisms.  But that is being optimistic.  And I don't know about you but optimism has had a totally shithouse track record for me.

P.S.  We can afford to build a lot of stuff and have plenty of people left over (unemployed).  But how come no-one can afford to buy anything? 

Lord Koos's picture

Sure people are living as best they can.  But at some point if you have no job, and have used up your savings and other resources, to keep the power on and food on the table, you're either going to go into the red or do some crime.  So far most people are doing the former but that could change if things get desparate enough.

I've never bought a new car in my life, never have made a car payment either.

PT's picture

But GM still makes cars, even though you can't have one.  Sure, they had to be given money to make it happen, but the resources and labour were physically there and now the cars physically exist, plus there is plenty of excess labour in the system.

And China had the resources and labour to build 64 million empty dwellings, but no-one can live in them.
Not to mention all the empty homes in the US.  (evenly distributed over the country, as opposed to neatly stacked up into cities.) 

Bad Attitude's picture

But... but... but... the TeeVee says the economy is doing great. Dear Leader says the economy is doing great. Walmart is always packed with shoppers.

Forward (over the cliff)!

European American's picture

I'm not tapped out

I am tapped out

TruthInSunshine's picture

LTER (and others) -

The fastest & relatively easiest way to do well as a proprietor today is to sell goods and/services to federal, state and/or local units of government.

This is how most of the largest corporations earned their Fortune 500 creds , and when, or as, the middle class, which used to comprise 56% of the population but was responsible for 85% of consumption, is continually shrunk, the only real way to "make it" in the U.S. (since as fewer people have less money to spend on discretionary OR necessary items, government continues to tax in a burdensome manner and inefficiently spend those appropriated monies in large measure on inefficient, wasteful, but MASSIVE procurements from private corporations,'such as armament and technology firms).

Never One Roach's picture

Moar student loans....

Moar zero-down mortgages....

Moar Free Sh*t...

It's only Fair.

Harry Dong's picture

Give me a link to your blog, I'll compare and contrast for you. 

Yen Cross's picture

  Ok, I'll bite without opening the link.  You're a professional "Cat Herder?"

Harry Dong's picture

Read it, it's worth the trouble. One of the few original bright spots in the cyberverse

MsCreant's picture

You are not a hairy dong, you are a shit. That suuuucked!

PT's picture

Any day now I'll get my "Watching Paint Dry" blog up and running and then you'll really have a blog worth reading.  Wait right here and I'll let you know when it is ready...

Harry Dong's picture

Hang in there Mr. Smith. Some of us love you.

nmewn's picture

You ain't scouting for illegals to hire are you? ;-)

LetThemEatRand's picture

Who is not an illegal these days?  Speaking of which, why can I DVR a movie on Showtime, but if I copy a DVD I've violated more federal laws than I can count?

TheFourthStooge-ing's picture

.

Speaking of which, why can I DVR a movie on Showtime, but if I copy a DVD I've violated more federal laws than I can count?

Because Disney.

LetThemEatRand's picture

"The Walt Disney Company, commonly known as Disney, is an American diversified multinational mass media corporation headquartered in Walt Disney Studios, Burbank, California. It is the largest media conglomerate in the world in terms of revenue"

Source:  Wikipedia -- the Facebook of the oligarchs.

Mrs. Haggy's picture

Yet my poor son (and I) are subject to Mickey's Raod Rally.  A cartoon about a race that is non-competitive.  It is only supposed to be about having fun.  There is one guy (Pete the buffoon) who wants to go fast and finish first.  He constantly runs into trouble and has to be rescued.  Nice work Disney.  Let's condition even future generations to not try to be the best.  That way you'll have an easier go at total domination.  So transparent.  Pink Floyd should sing "Disney Leave Our Kids Alone"!

Skateboarder's picture

"Hey! Bieber! Leave us kids alone!"

caustixoid's picture

Disney is pure evil. No, not just a greedy corporation enriching itself from your kids whining to see their movie, or purchase their tie-in products or go to their parks.  No, actual evil.  How do you describe a corporation that basically purchases children (child actors) from white-trash parents and then seemlessly moves them from cute kids to wholesome teens to rebels to tarts to sex-tape release? Rinse and repeat.  It's not all scheduled from the get-go?   These kids just self-destruct of their own   under the watchful gaze of tabloids, every degradation there for your viewing pleasure - it just happens, over and over?

I didn't let my kids watch Hannah Montana.  Why?  Because I knew that Miley Cyrus would turn into the suck-your-cock-if-you-buy-my-record tramp, just like Christina and Brittany and Lindsay before her. 

Did the Cory's get passed around by Disney, or was that another gang of Hollywood pedophiles?

Then again Jody Foster turned out okay-ish, so maybe I'm over-reacting.

shovelhead's picture

I have to admit my Mouseketeers sex tape didn't sell very well.

duo's picture

and Disney gets copyrights for 100 years or more.  Everyone else get 20 or so.  But if Disney steals your idea, you don't get dick.

RaceToTheBottom's picture

I used to laugh about people who said that the Millennials were different.  Now that I am hiring them, I no longer laugh. 

They all think they should be running the place when they are hired.  They don't have skills but are mad at you when "you don't give them the skills" to be promoted to run the place at 20 odd.

 

Business needs to go back and slap the teachers/systems that produce those kids.  They are doing no one a service.

mkucstars's picture

Mom was too busy working, the tv raised them.

 

bpj's picture

I was talking to an under 30 bartender and described a person as looking like the actor Tony Curtis, his response was, "I don't know who that is". Damn, I thought, I've become irrelevant.

PT's picture

What?  Ambition and enthusiasm are no longer desired?

(Yes, I know I'm sticking my head in the hornet's nest here but I still had to do it.)

 

 

http://www.dilbert.com/1991-05-19/ 

RaceToTheBottom's picture

Ambition is great.

Ambition to acquire skills, knowledge and experience.

Ambition to get promotions based on showing up, not so much.

RKDS's picture

Look at how many of these businesses are run (into the ground).  You'd have to have some awfully low expectations to not think you could do it better.

Things that go bump's picture

Why do you let your children watch such programs? If you must let them watch television, at least choose those programs that are acceptable. Condition them yourself by carefully monitoring the programs and limiting the amount of television they watch. You understand what a powerful tool of control it is.

FreedomGuy's picture

Bullshit. The government owns everything and everybody. Everything is done by government rules, permissions, certifications, registrations, inspections, fees, taxes, procedures, filings, and tax law. Nothing in this country moves without a government document including you. You have labor laws, OSHA rules, EPA, mandatory benefits at 30hrs, etc., etc. Yet, through the genius, benificence and omnipresence of government control...it all gets worse. The solution to government failure or shortcomings is more government control, power and money. Let's throw 10,000 more pages of regulations and 12,000 more pages of tax rules at the problem. Pissed off at healthcare? No problem. Throw 15,000 pages of new rules, fees, penalties and "taxes" at it. Make it mandatory because it is such a great idea. Raise the property taxes while you are at it to make sure all the government workers get a fat share of the wealth and Mayor Schmuck gets reelected.

There is simply one more thing you need to add to get completely out of this economic hole, blame Walmart, Exxon-Mobil, Pfizer, Citibank and all the others for the problems.

If there is any problem in this world at all it is always because there is not enough government and only selfish, stingy, uncaring free people and companies would say it is anything other than a result of the greed of free people which is lack of government rules and redistribution.

You leftist lemmings keep running off that cliff.

LetThemEatRand's picture

Large corporation profits and CEO bonuses are at records highs.  So you would be the lemming.  I suppose you like Ted Cruz, anti-government husband of a Goldman Sachs executive?  Since he's a Senator, I guess we can't technically call him a House husband.

FreedomGuy's picture

You still don't get it. You don't go to IHOP to buy socket wrenches. They don't have them to sell. You would not go to government to get favors, protection, public money, subsidies and the likes if they did not have them to give. They DO have them to give so buyers line up. In fact , buyers of favors are solicited. Congress is a professional protection and favors racket.

Take any company you really enjoy hating, any one, it does not matter. Exactly how would they oppress you or steal your money without government authority? They cannot. The root of the problem is we sold our lives, wealth and even the future to the government in good faith and they sold it to someone else. They keep the power, too. If Sachs, Exxon or anyone else gets out of line a hundred government pit bull regulatory agencies can be unleashed, fines levied and point made.

Keep going for the cliff.

giovanni_f's picture

Governments and large corporations not only perfectly co-exist, they depend on each other to obtain and hold total control over the masses. Sheeple, by definition, never-ever realize that the hand that seemingly feeds them (jobs, loans, tv) is the same that will hold the butchers knife. An now, graze on, sheeple! Uaaahahaha...

George Soros to Warren Buffet while watching Maidan snipers doing their job

Nick Jihad's picture

Well said. Also, big business is the tax collector for big government.

Zwelgje's picture

"The bureaucracy is expanding, to meet the needs of the expanding bureaucracy." 

NumNutt's picture

OK Fredomguy, let me just say I am not attacking you, I want to make a point and yours is the comment I have decided to respond to because I see a common thread in multiple comments. I would first have to agree with your view on the government, I am in agreement as far as the assholes always skimming my money, and making everything more complicated with useless documents just to justify multiple government agencies. Total bullshit. But at some point people need to except some responsibility for their situation. 

All my life my father had told me about how I should get an education in a marketable skill, something that would always be needed. Then after that if I wanted to pursue some other interest like archaeology I would always have something to fall back on.  All the people I currently know that are being impacted the hardest by the current economic situation are the people that never attended any school after high school, never bothered to try to fully understand how the financial system works, how the stock market works.

I see people all the time that will think nothing of spending 3 hours a day playing video games, but never bother to spend 5 minutes a month to read financial news, or tax law information. TPTB have made the world complicated for a reason, they know that the majority of people are too lazy to spend the time to educate themselves of how the financial world works, and knowledge is power.  I am constantly surprised at how little most people know of labor laws, or common law that impacts their daily lives. Yes it is boring and time consuming to read that crap, and it is easier to sit on your ass and watch TV, but if you choose to not make yourself aware of the world around you, don't stand around complaining that the world needs to change to make your life easier. There is an old sailor saying, "It is better to change your sails then it is to curse the wind" (or something like that).

Basically if you think the current form of government and financial system is going to change just because a bunch of 20 somethings are complaining that it is not fair, you are sadly mistaken. you are better spending your time learning the rules of the game, and figuring out how you can win by playing by those rules. All these people suggesting armed rebellion are fools, that is a last resort, you should hope and pray it never comes to that as most likely you will never live to see the outcome. Most likely it would result in some type communist dictator coming to power then you would be even more screwed then the current situation.

OldPhart's picture

#4 From September 2013 to January 2014, the personal saving rate in the United States dropped by a staggering 16 percent.

I can attest to that. I don't keep ANY savings in a fucking bank.  And I do have savings.

MsCreant's picture

;-)

Be careful who you tell. OPSEC.

Freddie's picture

#13 While Barack Obama has been in the White House, median household income in the United States has fallen for five years in a row.

 

ZIPR, TARP and all the other money printing and looting has pukk all capital away from small businesses. 

I have been watching videos on the Ukraine and how over many years they have been destroyed and driven into poverty by gangster oligarchs and their goons.  Does it sound familiar?

Rock On Roger's picture

Obviously they haven't bled that stone enough yet.

 

Stack on