Rich Begin feeling the pain down Economy

by MsMcReality | August 3, 2008 at 06:15 pm

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Well, it looks like the economy is going downhill all the more. Now, it seems, the rich are feeling the pain of the crashing enconomy- now that's saying something. It appers that they can noi longer buy all the luxuries that more middle-class people long for, and are actually appearing around thrift stores with their credit cards. Those who have lost things such as their jobs or homes are less sympathetic.

"It's a sluggish economy, and its difficulties are felt all over," said Joseph DiRenzo, a married 38-year-old father of three who left a hedge fund two years ago to enter commercial real estate.

To be sure, the poor and middle-class are being hurt more, but upper crust thriftiness could reverberate across the rest of the economy.

Other government data show households in the top one-fifth of the U.S. population ranked by income earn about half of all total personal income before taxes - an imbalance that gives the wealthy immense economic clout, said Sara Johnson, an economist at the research firm Global Insight.

Statistics also render 70% of the total GDP is contributed to consumer spending. And one should regard the fact that the majority of what is making up the group is in direct relation to the number of jobs available, hence the higest unemployment rate seen in 4 years. This forces employers to cut back expansion plans or even lay off employees.

Unity Marketing, a Stevens, Pa.-based firm whose clients include retailers in the more than $322 billion U.S. luxury goods market, said its latest poll of affluent people nationwide found a 20 percent decline in spending on luxury goods in this year's second quarter, and the lowest luxury consumer confidence level in the nearly five years the survey has been conducted.

Those who earned an average of $204,800 said they wouldn't be able to spend nearly as much this year as last year. Last year, "luxury spending" fell 4% and stastics shows a steady decline over the next 5 years.

Maybe it's just me, but I found it rather humorous when I saw a paragraph describing just what kinds of "problems" the rich are facing. I mean, I guess you don't get to go to the car action or have the luxury of a private jet. For me, well I've never known that luxury.