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Posts Tagged ‘Middle Class’

Home Prices Continue Slide Down

NEW YORK — A closely watched index shows home prices dropped by the sharpest annual rate on record in October.

The Standard & Poor’s/Case-Shiller 20-city housing index released Tuesday fell by a record 18 percent from October last year, the largest drop since its inception in 2000. The 10-city index tumbled 19.1 percent, its biggest decline in its 21-year history.

Both indices have recorded year-over-year declines for 22 straight months. Prices are at levels not seen since March 2004.

Jobless Claims Soar to 26 Year High

Dec. 11 (Bloomberg) — The number of Americans filing first- time claims for unemployment benefits surged more than forecast last week to a 26-year high, a sign companies are stepping up firings as the recession deepens.

Initial jobless claims increased 58,000 to 573,000 in the week ended Dec. 6, the highest level since November 1982, from a revised 515,000 the previous week, the Labor Department said today in Washington. The number of workers staying on benefit rolls reached 4.429 million, also the most since 1982.

Employers are slashing payrolls as consumers retrench and credit stays frozen. Mounting job losses and falling home prices increase the likelihood that the U.S. recession will extend well into 2009, adding impetus to President-elect Barack Obama’s call for an economic stimulus package of unprecedented size.

“The labor market is facing its worst crisis since 1982, and it is certainly not over yet,” Harm Bandholz, a U.S. economist at UniCredit Markets and Investment Banking in New York, said before the report.

“One of the most important tasks of the newly elected government is, therefore, to help distressed homeowners and to stimulate the labor market.”

Middle Class Americans’ Retirement at Risk

Three years ago, it unraveled. His company filed for bankruptcy. The collapse reduced his expected pension to around $5,000 a year and canceled his retiree health insurance. And, in three years of unemployment since then, West blew through all the money in his 401(k) as he trained for a new career.

“I lost my job after 27 years before I got my retirement,” said West, 52, of Hazel Park, Mich. “I ain’t going to get nothing.”

Of all the threats to the American middle-class standard of living, from stagnating incomes to piles of consumer debt, perhaps the least understood and among the most serious is the looming crisis in retirement. Several trends, each debilitating alone, are due to converge on the middle class over the next decade or so.