What in the world is going on?

Sometimes when you are trying to explain what you see out there in the economy, and more important, in the aggregate it is very hard to be concise. Everyone prefers to examine FACTS rather than opinions. There are multiple factors at work that all lead to a decline in the living standard of the median family in America.

With the October jobs report sending the treasury market into a free fall Friday, it might be a good idea to take a look at several variables confronting the U.S. economy and American living standards. Here are the facts:

1. Federal debt is soaring.

This chart illustrates why the pressure on the federal budget will now be dramatic if rates rise. This is actually the elephant in the room. The impact of rising rates on the economy, given the increasing influence of federal spending on the economy is much greater.

2. The Feds are printing an unprecedented amount of money.

Notice that despite the expansion of the money supply how low the GDP growth numbers have been. We get an occasional bump to acceptable growth numbers, but in the aggregate, despite an unprecedented level of monetary expansion, growth is sluggish. It is hard to imagine how the economy would behave if we shifted towards a monetary policy contraction.

3. Wages are stagnant.

Perhaps better than any other graph this chart explains how little all the debt/spending, and monetary expansion has found its way into the wage base. Of course asset prices benefit from a system that gets flooded with cheap financing, but real wages don't.

4. Nearly 40 percent of Americans are not working.

Essentially this graph explains how the unemployment rate could possibly have dropped so far over the last six years. This chart counts all people of working age who actually work, rather than only counting the people who claim unemployment benefits. America is not working much.

5. The business workforce’s share of income is declining.

This is a "follow the money" chart. If you think wages looked stagnant think about private sector wages. This chart does not show where all of this cheap financing and liquidity and financing is going. It shows where it is NOT going. The logical conclusion when considering this chart and the stagnant wage chart is that government employees are thriving since in the aggregate, private sector workers are losing an incredible amount of ground. 

6. Spending on food stamps is soaring.

When you consider the civilian workforce participation rate is at a multi-decade low, you have to wonder how millions of people can feed themselves. This chart on food stamp spending answers the question. More well-paid bureaucrats are handing out more money to food stamp recipients than ever before. 

7. Student debt is soaring.

The chart on student loan debt may be the most disturbing of all, because it shows what is happening to young Americans while they are in college. The minimum wage has climbed to levels that completely suppress employers willingness to hire college students. The incredible availability of student loans provides college kids not just with tuition, but with LIFE STYLE previously unheard of for the age group. Tens of millions of kids emerge with degrees that qualify them to earn next to nothing while being saddled with mountains of debt.

8. Home-ownership is still falling.

It is little wonder that home ownership has fallen dramatically. The student loan debt chart shows how that debt is gradually taking the place of debt service capacity that could be used to own a home. America's young people emerge from college with their futures mortgaged to the hilt. 

9. Real median family income is down.

This chart on median family income sums it up. The median family in America has seen its living standard plunge. It is a combination of all the factors illustrated in the charts that preceded this one.