Middle Class Woes in Detroit
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The way that Depressions work, no one but the very financial elite is left untouched. The middle class contracts substantially and is forced into a lower standard of living. Certain parts of the country, like Detroit, were hit first by the crisis and serve as a good indicator of what’s to come for the rest of the country.
From the WSJ, Detroit’s Food Banks Strain to Serve Middle Class :
Battered by massive layoffs, home foreclosures and nearly a decade of economic decline, more residents of Detroit’s middle-class suburbs are having a tough time putting food on the table.State agencies and nonprofit groups that serve the poor in southeast Michigan say they are seeing an unprecedented rise in demand for food assistance across the region. They point to a pronounced increase in those seeking aid for the first time, often families unaccustomed to depending on food-aid programs. And they expect the numbers to grow as Michigan’s jobs picture worsens.
And in the ultimate of ironies:
“We’re going to see pretty significant increases,” says DeWayne Wells, president of Gleaners Community Food Bank of Southeast Michigan, the largest food bank in the state. “We are even hearing from many people that, a year or two ago, used to be financial donors to the pantry.”
I like to think of Depressions as primarily great transfers of wealth. The poor to middle class lose their jobs, are forceclosed on, and are forced to make distressed sales. The very rich snatch up assets at firesale prices, and profit tremendously when the inevitable recovery arrives.
The collapse in the 2nd half of this year into 2010 will be shocking to most. Again, it’s all in the data and facts. I will try my best to elucidate the facts and the truth in the coming months.
More on this topic
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Food Prices: Here's the Real Story
(Money Morning, 5/4/12)
San Francisco Leads Detroit In CMBS Delinquencies for Apartment Properties
(REIT Wrecks, 10/13/09)
Detroit RIP
(Skeptical CPA, 7/24/09)
