This is an anecdote, but my brother was furloughed and has been waiting on any money (including the first stimulus) for literally months
I sort of assumed that people _must_ be receiving money because there's no way Americans in the lower deciles of savings would be able to pay their bills consistently without work or stimulus. If there's no stimulus and no work, how are they paying bills? Is it on credit? Was there actually some savings?
The fall/winter is going to be an absolute disaster because you can’t fix anything about the economy without getting the pandemic under control, which a large percentage of our leaders in the US have decided they have no obligation to do.
The mainstream of the Democratic Party has advanced little that would address any of this, mostly quibbling over means testing income supports and lurching right. And we can just look at that state of the pandemic in the US to know what the other side thinks we should be doing.
I often wonder how painful things will have to get to enact some change with the checked out masses. What will happen if we reach that point?
More riots, looting, autonomous zones, and probably hostile us army deployments stateside.
Also, we shouldn't forget that Michael Bloomberg decided to run last-minute as a Democrat, with the Democrat party changing the applicant rules so that he could specifically run.
The whole political apparatus is entirely corrupt. I'm not sure voting helps at this point. We have a massive amount of people who are on the last of their savings, with no unemployment benefit coming their way to help out. This may be the beginning of a revolution, if people are angry enough, maybe.
There's a massive, massive class divide between generations and ultimately this pandemic is going to explode it even further. We're still in the fingers-in-our-ear phase.
Also there have been temporary measures in place for things like utilities, ISPs, mobile phone plans etc. where people will keep accruing obligations on their bills without the services being cutoff. However it seems that those programs are about to come to an end. Locally where I live the utility service here said they will start doing cutoffs in August.
So I think it's a mixture of some amount of savings, some access to credit, and then a kicking of the can down the road for a few months. So my guess overall is that basically we are simply delaying the problem in a bunch of different ways. But at the end of that delay is going to be a lot of economic hurt when those bills actually come due.
My wife and I looked into several different personal or short term loan options for our upcoming IVF cycle(approx 30k$). Most banks have either stopped offering them completely or made the requirements much harder. The two of us with credit scores of 750+, combined 200k annual income and little existing debt couldn't get approved for a simple 5k$ loan.
I fear for those that have a more dire need for the cash than we do.
If you have bad credit but have over $1,000 in cash, go and get an unsecured loan for roughly 90% of your cash on hand. Ideally the terms should have a negligible or nonexistent prepayment penalty. Once you have the loan, repay it within 2-3 business days.
Rinse and repeat until your credit score starts to improve.
It's not a terrible hardship given our current situation but given the volatility in the job market it certainly makes us uncomfortable.
Most states (and all federally backed mortgages) have temporarily suspended evictions so the short answer is that people in financial distress dropped that expense, which is usually the single largest on most people's budgets (for low-income people this can often be 50% or more of take-home depending on the city - yes, the rule of thumb is that it shouldn't be higher than 25% but you simply can't find affordable housing in a lot of areas).
However that one eventually is going to come due because the federal mortgage eviction moratorium doesn't prevent you from going in default on your mortgage, it only prevents evictions. The 3-month timer is still running and as soon as the moratorium on evictions is lifted, they can kick you out immediately. So as soon as that lets up in a month or two there's going to be a massive surge in evictions in states that do not go out of their way to keep evictions suspended.
(and in fact this is probably a snowballing problem, the longer this crisis goes unchecked and the worse the economic pain gets, the more people that will be in default and the bigger the difficulty of getting "back to normal". Furthermore at some point that shit starts rolling back uphill economically, banks turned your mortgage into financial products and you not paying is cutting off the income of someone else, and in fact there is an eventual risk of a 2008-style crisis occurring on top of all the current problems if we get into a situation where people are defaulting en-masse.)
"Lies. Damned Lies. And statistics"
> The phrase derives from the full sentence, "There are three kinds of lies: lies, damned lies, and statistics.";
> it was popularized in the United States by Mark Twain and others, who mistakenly attributed it to the British prime
> minister Benjamin Disraeli. The phrase is not found in any of Disraeli's works and the earliest known appearances were
> years after his death. The phrase was attributed to an anonymous writer in mid-1891 and later that year to Sir
> Charles Dilke, but several others have been listed as originators of the quote, including frequent erroneous
> attribution to Twain himself.
Sixty-eight percent of adults 70 and older are mortgage-free, while 15.9% of Millennials are free and clear of mortgage payments.
I'm in my mid-30s and I hardly have any friends that own houses and if they do they're tech workers with decades left on their loans.
looking merely at owned homes is ignoring everybody that rents. Renters falling behind on their rent are equally likely to be evicted as soon as the moratoriums are listed.
(and that in fact goes to my point about "your rent/mortgage is someone else's asset", a renter who's not making mortgage payments is probably still putting someone else's mortgage in the red and causing havoc in the rest of the financial system. I don't personally shed too much of a tier for the personal finances of highly overleveraged landlords doing the BRRRR type bullshit, it's been screwing up pricing for renters for a decade now, but it's a problem for the rest of the financial system too.)
BRRRR: https://investfourmore.com/brrrr-method/
Also, as another poster mentioned, the demographics of home ownership tilt very differently. Lots of boomers own their homes, in many cases free and clear. The numbers for people in their 30s (let alone 20s) are pretty low these days, so your statistic basically ignores everyone under 50.
(And in fact even if we got younger people into homes, the same wealth transfer that boomers enjoyed probably cannot be replicated - it was artificially created by lowering interest rates from the highs of 19% in the 70s/80s down to basically 0% now, allowing people to finance much larger amounts of money and causing the underlying asset values to soar. Nor would it be desirable to do so.)
And in general I disagree with your comment further down in the thread about "you can say anything with statistics". The obvious thrust of that argument is: gee, I guess we better just not use statistics and argue about feelings instead. That's so much better.
It's pretty much an argument made by people whose positions can't be justified by actual data - they don't reconsider their positions, they just want to stop looking at the data.
So before you can have any faith in stats, you have to know the source and how the research was funded and by whom (this is before we even begin to talk about methodology flaws). If you do not know that then you cannot trust the stats at all. They are indeed worse than damned lies.
Homeowners shouldn't rely on the moratorium. They should have contacted their lender to get on a 3-month forbearance plan which can be extended for another 3 months when it expires.
I'm not sure how many times lenders are going to permit forbearance extensions, but once people are able to get back to work and start making mortgage payments, they need to call their lender for a loan modification. This brings their account back to current.
As someone wanting a home in a high CoL area, I would love a 10-20% off rush from thousands of houses going to auction or sale but it wold be devastating locally. We simply are not equipped, as a nation, to address the fallout from this years events. Especially not with current (lack of) leadership and circling of wagons.
But I do take your point that banks don't necessarily want to immediately boot everybody out, foreclose, and crash the market at a time when potentially not a lot of people are buying.
Do bear in mind that the Fed has injected a shit-ton of cash into the market right now, and there actually would be more buyers than you think - it's just that they would be rental companies looking for more assets to snap up at firesale prices.
I got mine almost immediately. What is the difference between me and your brother, I don't understand.
The EDD (California) did process millions of applications (or so they claim), but more than a million are still outstanding.
The problem seems to me to be in their mission objective: they view every applicant first and foremost as a potential "wellfare queen" and attempt to prove that as a fact (17 years ago, in the aftermath of the Internet bubble burst, I lost my job as well, applied for unemployment insurance benefit and the phone interview I went though was as bizarre as unpleasant -- I didn't get to the phone interview this time 'round).
I wished they would rather operate like the IRS: after preliminary, automated checks using tax records (was the person employed by employer as claimed, is that person now employed?) hand out the money and perform selective, random in-depth audits asynchronously.
this doesn't apply to 'stimulus check' in question. They sent it to everyone immediately based on tax returns.
exactly. CA state unemployment system doesn't have any of these issues because they always vote blue and fund their govt systems.
The letter stated that she needed to provide proof of her social security number.
She has tried to do that for four months now. She has called them, written them snail mail letters along with proof that they have the wrong social security number, and numerous faxes. They keep telling her that the ID fraud department will eventually reach out to her. It has not happened yet after all this time. We have even reached out to the California Governor's office for help. Nothing has worked.
If she did not currently live with me and have me financially support her through all of this, she would be broke and possibly homeless.
Maybe we will learn a lesson from this, but the number one political priority right now seems to be indemnifying businesses from pandemic-related harm caused to their customers and employees, so I’m not optimistic.
So yes bad but less bad with context and certainly something that is a leading indicator of something very very bad.
Our Govt sucks because we continue to let them get away with this. Where are all the Senators and Congress people ? Where are the Governors ? Some are trying but most of too busy politicizing it and still denying the reality that shit has hit the fan.
It is only going to get worse. I am about to layoff a couple of employees too since they just cannot work remote and their performance has gone down significantly. As a small business owner, I don't have the margins to keep paying them anymore as we are considered a "non essential" business and cannot go to office yet.
The president should be making distributing this aid, and fixing the unemployment benefits mess his priority for these people. Instead he's doing a photo op with cans of beans in the Oval Office, and another photo op down the street with a bible he holds like an alien artifact
Unemployment is almost all within the remit of the individual states. The government approved additional payments to each state, but the state government is responsible for dispersing and managing the unemployment system.
State: Depends on which state you are talking about
Local: Depends on the municipality
Let's also not forget the international leadership, particularly WHO, for its spectacular early failures such as ignoring warnings from Taiwan (https://www.reuters.com/article/us-health-coronavirus-taiwan...) and avoiding any action or statement that would offend China such as calling for a travel ban in January (“In fact, we oppose it,” https://www.technologyreview.com/2020/01/30/275959/the-china...)
Regardless, the U.S. federal leadership's incompetence has made everyone's else's jobs exponentially harder. But I don't think it's fair to blame all states and municipalities for failing.