Merry Christmas?

Something is very wrong with America. Our economy is sick and it may never recover. You have to wonder when the party is going to end. Now that home ownership is at its highest levels ever, it means that Americans who mortgaged their entire existence for a piece of this pie are the greatest risk ever of losing it all when it comes crashing down. I am a struggling homeowner myself, so I hope for the best, yet fear for the worst after reading a new report called Middle-Class Turmoil. Most of these factoids won't be news to many of you.

Americans continue to have a negative savings rate, with their credit cards maxed out.

Many homebuyers with interest free ARM loans are struggling to make payments as the loans adjust to much higher interest.

Salaries are stagnant or falling for many poor and middle class.

The Arizona Republic underscores this a recent article entitled Home loans catch up to consumers. Homeowners have cashed out their equity just to keep up and it now its time to pay the piper. Our so-called economic recovery, much weaker than previous recoveries, is actually just a ticking time bomb. The article also reports that houses are selling slowly in major markets like Phoenix. Same is true in San Diego, where I can't unload mine or even rent it.

The Kansas City Star reports More evidence of housing slowdown, with even a drop in the median home sales price.

Defaults and foreclosures likely; they are already at the highest rate in 30 years

At the same time, there reduced bankruptcy options due to new laws, yet even so the rate is higher than ever.

There has also been a decline in healthcare and retirement benefits.

While unemployment is technically down, long term unemployment at its highest rates ever; in addition, many new jobs are likely to pay less than the ones that were lost. The only reason the overall rate has technically dropped is because many folks have been out of jobs for so long they no longer qualify for benefits. Educated white folks are doing way better than other demographics, unless you are one of those stupid idealistic white guys like me who wasted his entire adult life pursuing a pipe dream instead of climbing the corporate ladder.

On top of all this, we have sharply rising energy costs to contend with, which will only further pinch the middle class budget. 2006 could turn out be the year when the s**t finally hits the fan.

There must be something really wrong with an economy where most small businesses would fail except for christmas shopping. In other words, we would already be a third world ghetto except that credit card companies continue to flip you enough bucks to just barely turn it around once a year. What is the plan? The powers that be know this cannot go on forever. But perhaps the 300 million middle class American consumers could be replaced with 4 billion dirt poor third world consumers. So even if America fails, the rich multinationalists will still be laughing all the way to the bank.

Today we learn that many of the richest rich are not paying taxes at all.

Here's a christmas treat reported from a Texas newspaper that right on the heels of cuts in student loans that the current funding is already falling far short. With college prices at all time highs, many cannot afford to go, relegating them to a lifetime of low wages, while other are left saddled with so much debt, they are still living like paupers well into their 40's. I fall into the latter group myself.

Everyone knows that government debt and deficits are at record levels even though Clinton left us with a balanced budget and the largest surplus in American history. But we are at war, which justifies all costs. Oops. Except that the money we are spending in Iraq has nothing to do with protecting us against terrorism. What good will democracy in the middle east be if it dies here in the US. As for that so-called democracy, today an Iraqi court invalidated the election of most of the sunni candidates who won parliamentary seats, further consolidating their unholy theocracy with its close ties to our best buddy in the sand, Iran.

All this can only lead to a dramatic decrease in consumer buying with the debt ridden government powerless to help. Is this just a blip or something worse. So have a Merry Christmas or should I say Happy Holidays. Like it friggin' matters at this point.