I wanted to share a great article from Business Week. The future for the current generation of young workers is looking increasingly grim as the first depression since the 1930's continues to wreak havoc on our economy.
The numbers are grim:
"Affected are a range of young people, from high school dropouts, to college grads, to newly minted lawyers and MBAs across the developed world from Britain to Japan. One indication: In the U.S., the unemployment rate for 16- to 24-year-olds has climbed to more than 18%, from 13% a year ago."
"What's more, the baby boom generation is counting on a productive young workforce to help fund retirement and health care. Instead, young people risk getting tracked into jobs that don't pay as well, says Lisa B. Kahn of the Yale School of Management. That would mean lower tax payments for Social Security and Medicare.
Only 46% of people aged 16-24 had jobs in September, the lowest since the government began counting in 1948. The crisis is even hitting recent college graduates. "I've applied for a whole lot of restaurant jobs, but even those, nobody calls me back," says Dan Schmitz, 25, a University of Wisconsin graduate with a bachelor's degree in English who lives in Brooklyn, N.Y. "Every morning I wake up thinking today's going to be the day I get a job. I've not had a job for months, and it's getting really frustrating."ANXIETY AND FEAR"
"The sense of stasis in many Western countries is reminiscent of Japan, where talk of a lost generation has been around since as long ago as 1995. Some 3.1 million Japanese aged 25 to 34 work as temps or contract employees—up from 2 million 10 years ago, according to the Ministry of Internal Affairs."
This article was quite eye opening to me. I hadn't really taken time to think about the impact that our depression will have on young workers over the long term.
The fact that 46% of workers aged 16-24 are jobless is flat out frightening. How will these kids ever get ahead? How will they ever be able to earn enough money for a stable retirement if they lose a decade before the economy recovers? Even then, who is to say that the economy sharply recovers within 10 years?
Japan still hasn't recovered from its post bubble malaise and it happened over 20 years ago! America wasn't able to recover from the depression in the '30's despite the government trying everything under the sun to stimulate it. WWII finally got the economy kick started again towards the end of the decade.
You need to ask yourself: After a euphoric 25 year bull run, could we not see a 20 year bear now after such prolonged prosperity?
Another thought here is how in the hell are we ever going to pay off our trillions in debts without young prosperous workers from which to tax from? Also, who is going to fund the massive medicare and social security programs that will be dramatically drained as our baby boomers retire?
The Bottom Line:
I'll tell ya folks. The more I think about the future the more frightened I become. I see no way out of this fiasco without years and years of pain. NONE!
As I watch the dollar fall on an almost daily basis I can't help but think: Is it time to buy guns and gold and move up into the mountains? It's starting to look like this might be the best alternative.
The economy and our currency are both in a free fall and the elites in the ivory towers simply don't seem to care.
When is America going to rise up and say Enough?
Disclosure: No new positions at the time of publication. Long GLD and SLV in longer term accounts.