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Thread: (late) chart of the week - debt levels of low income Americans

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    Banned Melonie's Avatar
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    Default (late) chart of the week - debt levels of low income Americans




    To put this in context, some 35-40% of American households or about 110 million Americans earn $30k per year or less. Collectively those 110 million Americans owe 700 billion dollars worth of debt. That amounts to an average personal debt level of $6,400 for every single low income man, woman and child. With rising prices for food / energy / rent (property taxes) etc. taking an ever bigger bite of the poor American's $30k gross = $400-$450 per week take home income, it's virtually assured that at least half of that 700 billion dollars worth of debt will never be paid.

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    Last edited by Melonie; 08-18-2008 at 02:45 PM.

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    God/dess Deogol's Avatar
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    Default Re: (late) chart of the week - debt levels of low income Americans

    What is even nicer the debt lender gets to write that off while keeping the service fees, late fees, and high interest and money earned (and not applied to the original principle.)

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    Banned Melonie's Avatar
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    Default Re: (late) chart of the week - debt levels of low income Americans

    ^^^ it's not so nice if you happen to live in a state which is the home of many 'loser' banks. The reason of course is that the tax losses which can be carried forward into future years will VASTLY reduce the amount of federal and state income tax that the 'loser' bank must pay for years to come. That shortfall, of course, must be made up by hiking the tax rates on individuals and other businesses.

    (snip)For the past 20 years, Robert Willens has been a tax and accounting specialist at Lehman Brothers Inc.On Monday, Willens launches an independent consulting firm for investors, called Robert Willens LLC.

    Willens has also been a long-time contributor to The Deal. Today, he weighed on the structure of the Bank of America/Countryside merger. Willens highlights the benefits of Countrywide's troubles for BofA:

    Countrywide, of course, has losses in its assets which have yet to be "cashed-in" for tax purposes. These losses are valuable commodities because, assuming no limitations on their use, each dollar of loss can offset a dollar of otherwise taxable income saving the beneficiary some $0.35 in tax."(snip)

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    God/dess Deogol's Avatar
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    Default Re: (late) chart of the week - debt levels of low income Americans

    They got it all figured out.

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