I’ve always said you cannot have too much debt. The problem with debt, however, arises when your cash flow cannot pay the obligations of the prior borrowings. The previous two Stewart Blogs detailed personal and state+local debt on a per capita basis by state. This blog will add those two together, include the federal debt …Read more
While the typical American has $50,090 of personal debt from credit cards, auto loans, school loans and mortgages, other debt obligations of the government are present at local, state and federal levels. While no individual’s name is directly assigned to repay governmental debts, the residents will in one-way-or-another be taxed or pay fees to service …Read more
The Modern Theory of Finance says that borrowing and investing today allows individuals to select both optimal investments now (such as borrowing for college to earn greater income in the future) and to also optimize future consumption patterns (like investing for retirement supporting a better lifestyle when income from employment lags). From a theoretical perspective, …Read more
The incentives to grow wealth are multifaceted. People in wealthier countries not only typically are healthier and live longer, but have the opportunity for experiences, comforts and lifestyle that otherwise would not exist. They are two ways to measure the wealth of a country. Gross Domestic Product (GDP) is the value of all goods and …Read more
On the way to work this morning the radio announced that by 1:00 p.m. this afternoon the temperature in Houston would reach 97 degrees. The Heat Index, however, would make it feel like 110 (neither a record by the way). As an economist, my thought went straight to what the air conditioning was going to …Read more
The U.S. just entered a record-shattering 11th year of economic expansion. The economy added 224,000 net new jobs in June 2019 (preliminary) far exceeding the expectation of 150,000 new jobs by economists polled by MarketWatch. Job growth was at 1.54 percent, 8 percent greater than the 40-year compound annual growth rate. The unemployment rate feathered …Read more
Jobs are everything to an economy — and the economy is doing well. In the past 40 years, the U.S. average compound annual job growth rate was 1.43 percent. The current 1.58 percent is 11 greater than the 40-year average. Job growth is not systemic, however. As usual, I invoke the TINSTAANREM axiom — There …Read more
Almost one-half of Americans (46 percent in an April 2019 Gallop Poll) said their biggest worry was not having enough money in retirement. Only 51 percent expect to live comfortably once retired, down from 54 percent a year ago. Retirement is much like buying, using and maintaining a car: The cost for each is different …Read more
Jobs are everything to the economy. Period. Good news is that, for the second month in a row, positive job growth was registered in all 50 states for the 12-months ending May 2019 as shown in the following table. Nevada, the top job growth state at 4.00 percent, had more than two and one-half times …Read more
My favorite Axiom as a real estate economist is the TINSTAANREM statement, which is am an acronym for There Is No Such Thing As A National Real Estate Market or a National Economy. The same is true regarding income. Median income per capita or household, for the country, by state or Metropolitan Statistical Area, varies …Read more