Broke America: Why Half of Us Only Have $1,000 to Our Names

Another week of bloody trade is in the books, culminating with Friday’s massive sell-off nearly across the board. The Dow plunged 391 points, or 2.4% in the session, as oil skidded below $30.

Downbeat retail sales numbers, as well as news that bellwether Wal-Mart (WMT) was going to close 269 stores worldwide, helped fuel the major selling.

What’s also largely fueling the sell-off is just the huge amount of fear out there among investors that the bull market has run its course.

Given the big selling this year (Dow and S&P 500 down more than 8%, Nasdaq down more than 10%), it’s not a stretch to think that a bear market is right around the corner.

Certainly, we’re in a full-blown correction (down 10% off the recent highs), as the broad-based measure of large-cap domestic stocks now is down about 12% from its May 21 record high of 2,130.82.

Perhaps more troubling is a fact we pointed out in today’s Morning Edition. That is, that the average stock in the S&P 500 is down 20%. In fact, some 50% of S&P 500 stocks are down more than 20%, and officially in a bear market.

If you’re worried about this market (as we all are) then you need to check out today’s Morning Edition, as well as Wednesday’s Afternoon Edition on just what it will take for the markets to stop the bleeding.


Now, for the remainder of today’s issue, I want to put my astute readers in the spotlight, as we were flooded with some outstanding feedback on yesterday’s Afternoon Edition, “When More Than Half Have Less than $1,000.”

This article really resonated with you, and here’s just a sample of some of your fantastic (and voluminous) feedback on my take on why:

  People have so little money …

  Hoping for a presidential candidate to “fix” things is an exercise in futility … and

  The only solution is for people to take extreme ownership.

CW writes:

The person who starts smoking pot at 12, drops out of school at 14 and is a single parent by 16 has little cause to blame capitalism for a less-than-stellar standard of living. The same goes for spending more than you earn on non-emergency items. (I do not count a plasma TV as an emergency item.)

The only places where [Washington] policies earn blame are by setting the example of spending money the government can’t cover by reliably predictable income estimates …

You get what you pay for, unless you are the government, where you get what you promise to maybe pay for someday.

Bookworm writes:

There are many reasons why people are broke and have nothing saved, and it doesn’t mean they are irresponsible. Americans have been so brainwashed by the cult of “individualism” that we are forgetting to be kind, to help out our fellow man, and that society is made up of people working together, not just individuals afloat on their own private islands.

Brad response: I agree with “Bookworm” that there are many reasons why people are in bad financial shape. However, the answer to that situation cannot be found through others — i.e., via the “outside,” and especially not by politicians. The solution to an individual’s problems must come from the individual. If that suggests a “cult of individualism,” then perhaps that cult is on to something.


Nancy writes:

At least part of the misfortune of America comes from a lack of stability within families. It is difficult and more expensive to face the trials of life in a house divided. The cause of this lack of stability has its roots, I think, in the social revolutions of our time. However, I’m sure the economic policies which make jobs scarce and less-lucrative don’t help.

Joe writes:

Outstanding article, Brad. While it is true that the policies of governments have hindered business and job formation, and there are unfortunate people who have a devastating setback (accident, illness, etc.), I agree the main reason is individual attitudes.

Too many Americans have lost the sense of personal responsibility, and they make things worse by electing (and re-electing) politicians who promise them relief from the hard choices and efforts that are needed to get and keep a good job, start building savings (i.e., capital), and make lifestyle choices that will at least give them a fighting chance of overburdening the broken health system.

Robert writes:

I think your reasoning is sound as to why Americans have so little capital. However, in this current climate, individual effort is severely hampered by idiotic government policy and market intervention. This government (and predecessors) is far too interested in self-preservation and panders to big banks, insurance companies and big pharma.

Larry writes:

The reason that the people are broke is because “The Government” be it Federal, State or Local are sucking the life out of all the people in the middle class to pay for their exorbitant programs. Welfare and greed leave the working man nothing to work for. Greed by these people is the problem, not greed by the corporations and companies.

Brad response: “Greed” as it’s commonly, and incorrectly, thought of (i.e., accumulating wealth at the expense of others) is not healthy. But there have always been, and will always be, greedy individuals, corporations and politicians.

The fact that others are greedy, corrupt, selfish or unethical still does not alter the fact that if a person is broke, only that person can act to change his/her circumstance.

No matter what the reasons, there is still no abdicating the fact that individuals must act to make their lives rational. And, the better their decisions, the greater the likelihood they’ll find themselves far away from the “broke” category.

Finally, I’ll leave you this reader response that nicely sums up my stance on this issue, as well as the thoughts of the overwhelming majority of responses.


Sheryl writes:

I fully agree with your article. It all comes down to personal responsibility, which we are sadly lacking in more ways than just financial responsibility. Unfortunately, too many individuals want to blame anyone but themselves for their situation, whether it be financial troubles, legal troubles or whatever. We need to wake up and take responsibility for ALL our actions in order to make this country great again.

Let’s not stop there. If you haven’t yet commented on this issue, I encourage you to do so today. Just leave me a comment on our website or send me an e-mail and tell me what you think.


Thursday’s rally provided only temporary relief to the new year’s selling. Not only did those gains get wiped out today, but the S&P 500 took out its August low and is at October 2014 levels. The Nasdaq saw its worst losses since 2008.

•  The Dow has lost 8.2% in just the first 10 days of the new year. That’s roughly 1,400 points, taking the index just below 16,000 in today’s session.

•  The stock market could fall another 10%, according to BlackRock (BK) Chairman Larry Fink. With stocks already down 10%-plus, this would put us squarely into bear-market mode.

•  Fink also said oil could test $25. Considering that WTI crude dropped 5.7% today to $29.42 per barrel, that’s not a far drop. One energy expert even says oil could quickly plunge to less than $5 a barrel … and this massive plunge in oil prices will change everything.

•  Wynn Resorts (WYNN) provided a dot of green in a sea of red. Shares popped 13.3% on earnings that showed better-than-expected revenues in Las Vegas.

•  Wells Fargo (WFC) and Citigroup (C) reported earnings beats, but both saw their shares sink amid the broader market bloodbath. They lost 3.6% and 6.4%, respectively.

Good Luck and Happy Investing,

Brad Hoppmann


Uncommon Wisdom Daily

Your thoughts on “Broke America: Why Half of Us Only Have $1,000 to Our Names”

  1. Multiple causes, not one single factor. However the overriding or common factor if you like, is corruption. Not simply wrt fraud ,kickbacks and the like, but corruption of values led by representatives /leaders both political and commercial. Social drivel with respect to drugs and welfare ,single mothers to all and sundry etc …….and really ,…need anyone really ask why?

    Love without the Tough, ain’t love at all

    One thing is certain …the coming super depression will remove the largesse in a heartbeat

  2. the economy can easily be improved by eliminating small & medium sized business taxes and unnecessary regulations. These businesses will be happy to then hire more people resulting in more taxpayers. People are not likely to be looting stores if they have to get up early next morning to go to work.


  3. Don’t just blame the government, we had a chance to fix things 30 + years ago Ross Peroll told us on tv with his charts and campaign ( reminded me of trump so much). We had a chance than and we once again have a chance to turn this country around financially, no one could see the truth but now it’s overtaking us. Wake up, we all vote, we are electing morons to hold our future, would you let a toddler drive your car down the freeway, no way! But we let financial morons lead us and take our money, destroy all our future. Look at the mess Illinois is in and at last count still had no budget in place! This same leadership has now control over country? Gee wonder what happened, how bout fix ill first, then un for pres.
    What is so dumbfounding is that so many normally smart people vote stupid when it comes to national leadership. Special interest have no place in the fed! Our national Gov should make good financial, decisions protect our borders, unite our Soverine states, not bring in special interests and health care, the states should deal with all the business laws and special interests, if you don’t like one state move to another, this is the beauty of the United States,( supposed) and overseeing the states and keeping state gov in check. 50 choices not force legislation on everyone. I believe we would have faired far better by letting the states have the power they were supposed to have under the original Const. States can handle everything , at least the way it was originally intended.
    Many will disagree, but when has anything that the fed gets involved with prosper long term? A much smaller fed budget is easier to manage, and as states fail to balance their budget, the fed steps in and brings a resolution. I’ll. Is in trouble right now because entitlements are breaking the budget! Ask yourself would I rather have a 5% cut now or loose 80% not to long from now? If we don’t all agree on things quickly we are headed for sure trouble as uncle Samoan no longer bear the load being placed on him. We used to ask what we could do to help the old guy, but not we just beat him and demand more. We want more! We don’t care how you get it! More now, you figure out how to pay the bill, your rich and control everything! Make something work but don’t touch mine. Sounds like my teenagers years ago, only worse, these brats have real clout and they would rather sink the boat then take the slightest compromise! Everyone is having a hard time lately, let’s work together people. It can work!
    I heard a liberal commentator stating how the country was safer and better off now then years prior. His one comment referred to low oil prices and less money spent at the pump being a great thing for this economy. On just this one point I will expound, because of the complete lack of understanding by the cronies of this administration, failier to see that while low oil prices may seem great, it is causing a massive amount of problems in the financials. As oil stays below production costs, thousands of America oil co are going bankrupt, large banks have loaned billions of dollars and are in deep trouble, thousands of America workers are loosing their jobs and out side interest will gain the upper hand if something isn’t done quickly.
    I have an idea , not impossible but most improbable. The president should take control immediately and block all oil imports to this country and bring oil to at least 65 per barrel as fast as possible! This would help restore faith and clout in the oil companies and most importantly the banks that have loaned large amounts of money invested in a sure asset, the people and resources of this country! Make no mistake after these oil co are bankrupt the price of oil will go through the roof and our finances will be in shambles. For a world leader to not see this is incompetent , advisors should be giving strong advice that something needs to be done now! But they are not.
    Bell telephone, oil companies, Coke ,bud, many large companies used a blitzqriege style of taking territory by under cutting the local competition or just suein them out of business. This I’d what is happening now with our oil, there’s to much invested, as much meddling as the fed has done with other things why can’t they do something now? We are in a desperate place and the only real issues seem to be special interests! Please think when you vote, who is really best suited to guide this ship? Without good finance we will have NOTHING! Yes money and oil are dirty, but gears.

  4. Individual responsibility is king!!

    Born and raised in “Thrift City” – the poorest part of Flint, Michigan, Poor is a poor word to describe my younger years. Outdoor toilets, dirt roads, outdoor slop ditches, Horses pulling milk wagons, ice wagons ( no such thing as refrigerators ), No bathtubs, no hot water, no nothing, except a wonderful father and mother, who loved their 3 kids. Yet, we three kids, never stop talking about our utterly fantastic growing up! Yes, we are Caucasian , white race, where our family never received a pennies support from anyone, including the government! Our parents never gave us anything resembling money, except a wonderful childhood full of work and some play!
    I grew up to graduate from high school, marry at nineteen, marry by choice, no shotgun wedding and have had the pleasure to have ( 12 ) twelve kids, all our own! all single births.
    Even though my wife never worked outside the home, we bought a home at 19 years of age, built our own home at 25 years of age and paid for the home by age 31. Bought a lake cottage in Michigan at age 39, paid cash! Bought a Florida home in Ft. Lauderdale at age 44, paid cash. Same year, bought Condo home on the ocean at St. Augustine, Fl. held a mortgage, and purchased a condo at Tequesta, Fl. 2 years later. We never rented our places, we owned all of them at the same time, and merely used them for our family to use. No one has ever given us anything, We are Conservatives, the most conservative in this country, people call us frugal, where we now live on South Hutchinson Island in Florida and in Davison, Michigan , while we enjoy our retirement.
    My wife and I always thought other young people were fools, busy squandering their money while we enjoy our lives, our 12 kids, 33 grandkids and 16 Great grandkids.

  5. Everyone and their dog appears to have a pointy finger focusing blame with some notional value to a cure. There is much mention of individualism but not responsibility, cause and effect and certainly profit and loss. Depending on your worldview and potty training we may assume the fed has its finger on the money and on the necessary buttons to keep the herds on track. We have a federally anointed prez who for the life of me gets standing ovations for minutes for what ? walking on water !. The general decline of common sense and following that numeracy to be substituted with personal Serendipity would best describe individualism at this time. Whatever the prez represents we know he is subordinate to the way money works if not token rewarded. Additionally those of the allies and tools of money as we can certainly bank on those.

    But do know that the federal reserve has taken up the wholesale of resource redistribution to its version of what will be. We are collectively a herd and based on the federal reserves own nomenclature with social engineering research and fiscal policies with eluded initiative programs. We may certainly view its operational manual for human resources as sum certain, Why ? I suggest a reading of the heavily redacted document, ‘Fiscal population growth, (Endogenous)’ WP630. Downloadable from any federal reserve repository under research. This is also the renowned First Welfare theorem. There is a cost on the road to the new nirvana and its misunderstood means with elevated priorities of intent, both the past, the present and the future. Read it in the document. It may not be the sacrifice you are willing to make if you understand the endgame. However do be prepared to sacrifice your very souls and that which is your most precious to servitude to retain your idea of independence.

  6. Brad,

    It is PARTLY the fault of ALL of us and MOSTLY the fault of the called “GLOBAL ELITES” for most of the worlds MAJOR problems and that includes money/banking/finance/economics/world geo-political activities..etc..etc..Over the past 100 years, they estimate well over 200 Million people lost their lives to powerful elite tyrants and so called “leaders”. Many millions have lost their jobs, benefits, pay etc.etc.. and way of life to powerful elites. NONE of it any of their fault.

  7. brad – yes and no
    let me put this in perspective where you say,
    “The solution to an individual’s problems must come from the individual. If that suggests a “cult of individualism,” then perhaps that cult is on to something.”
    too simplistic to say it nicely as i said last time – you’re just as half-assed whichever cheek you have left
    if so
    we should never have fought the germans -we should have
    let those irresponsible idiots in prison camps and those individual countries that fell to the nazis solve their problems as individuals.
    when the mafia extorts someone for protection is it really an individual problem
    and if you don’t see the problem with pushing people to buy when you’re selling short
    those people stole multi-billions from the society probably putting what we call criminals too shame and leaving everyone who works for a living with less – that’s larger than an individual problem
    too many people work two jobs and can’t make enough while some ____ (fill in the blank)
    it’s not exactly an individual problem – again some of what you say is true maybe much
    i think community is important
    when the system or society is out of sorts we need to work together to make it better
    it’s both individual achievement and working together
    that’s how how a team wins or a society

    and problems trying to live together absolutely, still would those of you who blame gov’t,
    as if it were some entity out there, really like to live without one as if you were advocating anarchy, are you? if not let’s think together not against
    if we worked together, meaning disagreed constructively, to look for better ideas of how to share the planet we might do better
    but i could be wrong maybe class war is the answer

    maybe more importantly what is seemingly lost in this conversation is what do we owe to future generations
    or do we deplete the planets resources completely for individual profit until the world is a mad max scenario
    and then blame them for their lack of initiative?
    something needs to change but let’s not jump to the simple lynch mob answers
    let’s have a trial that truly seeks a greater truth
    lets continue talking until were all wiser
    imho the vitriol – addicted as we are to it, is way more the problem than the solution

    we need both our responsibility as individuals and to our society
    or i fear we’re headed to ‘hell in a hand basket’
    my time is almost up- i wish you all the very best future

  8. I agree with Rick C. The congress needs to be replaced, and certainly should WORK TOGETHER for the general good of the country. Keeping the same people in office for years & years isn’t good for the country.
    Let’s save some of the money we send everywhere and build our bridges, roads etc.!
    Always read all your articles, and enjoy them! Keep it up!

  9. Brad – as long as the government (no capital g ever as far as I am concerned) can keep people broke it can control them. I have never been a conspiracy theorist but the one thing my father and grandfather taught me from day #1 is that the only purpose of a politician is to keep getting re-elected at any and all costs to in order to stay at the trough. They do not care about anyone except themselves and the fact is – if you are now in public office you are part of the problem and not part of the solution to the problem. The congress and senate need to be replaced. People are broke because they have been fed a plate of lies and slavery is al;ive and well in the US!

  10. While I totally agree that as individuals we need to take extreme ownership to overcome our problems and challenges (no one else is going to do it for us), we also need to recognize that the system has been designed to make it very difficult to do, much more so that it needs to be.

    For example, the social pressure on young people these days to go to college and get a degree is very high, especially if they are even decent students, and to do that, nearly all of them take on considerable debt. Is it possible to get a degree without going into debt? Probably, but they are definitely pressured to go into debt. Will the degree pay off? For a minority, probably, but for many it will not, and for those who don’t finish their degrees, the debt remains, without the means to pay it off. Starting life in your early to mid 20s with tens of thousands of dollars of debt makes it really hard to start saving, or even to keep up with the growing interest on your debt.

    Furthermore, the majority of the jobs that exist, or that are being created, are low-paying. The industrial and manufacturing jobs that used to support the majority of middle-class families are mostly gone. Even for those who get degrees in STEM (science, technology, engineering and math), there are no guarantees, and if you settle for an “easy” major, your options are very limited and the competition is fierce.

    Is is possible to overcome these problems? Yes, if you are intelligent, motivated, and have a good mentor, but for a generation raised on main-stream TV and computer games, from broken or dysfunctional homes, and with no trusted adults in their lives to guide them and give them reality checks, it’s not easy, or likely.

    As individuals, each of us has to do the best we can, but for our nation as a whole I see no real prospect that things are going to improve.

  11. An entire class of dispossessed workers is seldom mentioned: White males. Since “affirmative action” policies were put in place back in the 70s, a steady attrition of white males has been pushed in the technical professions. Last hired, first fired. When statistics showing a slight female advantage in salaries for equivalent jobs are looked at closely, the situation is that those white males who cannot get employment in their profession are not included as they may make less than half. Abuse of the H1b foreign tech worker program by employers puts more of them on the street. Highly skilled and effective engineers can be found selling used cars, etc, a terrible waste of national resources not to mention those who worked hard to get a technical education (the hardest one) who have then lost their career, homes, marriages, everything..

  12. I don’t believe for a minute that ‘HALF of us only have $1,000 to our names.” WHY should that be so? OK, we have what 10-15% real unemployment in this country. The average family earns close to $50,000?
    Sure, I’ll grant you it is NOT the country this guy grew up in, but it is not yet some banana republic either.
    Having a bit of money, whether for those unforeseen emergencies, or a retirement nest egg, is something if you are going to have it – YOU are going to build it!!! You start, by saving a bit each week $5 is a start. $10 a better start, but don’t give me this crap you can’t save “anything.”

  13. Easy credit (mostly through credit cards) has left a lot of consumers in red ink up to their ears, and of course nothing in the way of savings. My dad went through the Great Depression of the 1930’s and brought his two sons up to be very careful how and when they used credit. His motto was “Save first, buy later.” Now it’s “Honey, lets put it on the plastic.” I don’t drive the latest in automobiles, and the computer I’m writing this on is used/refurbished. But both are fully paid for, and if necessary I could pay a unexpected $1,000 bill.

  14. There was a time in the dim and distant past when we were equally energetic in pursuit of both our rights and our responsibilities. These days, while we insist on our rights, we seem happy to shrug off our responsibilities to politicians who claim they can fix all that ails America, if only we would give them our votes. The sad truth is that government can only do so much. “The fault, dear Brutus, is not in our stars, but in ourselves that we are underlings”.

  15. This is the death knell for Keynesian economics and the disaster of deficit spending. This is where The War on Poverty has brought us. Where there is no virtue, there is no prosperity. The culture of debt is having it’s day of reckoning.

  16. Hi;

    I agree with Larry and Bookworm. I think my contribution would be that “Mass Herding” in part sponsored by previous Presidents and past Federal Reserve Presidents like Greenspan and Berneike, magnified by Mass Marketing have let the majority of American’s right over the Financial Cliff.

    G.W. Bush encouraged people through tax breaks to go out and buy that big expensive pickup or luxury car. Then how about the Government sponsorship of encouraging people head long into the R.E. Bubble feeding them no document, no-down payment loans, allowing banks to market Illegal Aliens to buy houses only….”need to show utility bills”. Then encouraging them to go out and buy those new cars, big screen TV’s etc.

    I’d like to hear from other responsible adults like me; how many times did you get chastized by family members and friends for not joining the other lemmings headed for the cliff? I took an awful lot of guff of family members for selling our last property in USA in 2003, instead of buying into the soon to be Crash. It took guts and getting a lot of guff to “keep my head”. How many other’s of you went through this?

    Mr. Salyer

  17. I work in an industrial laundry, and I work with some of the hardest working people I know. They start out at Minimum wage and make maybe $.13 cents more per year. It seems like no one considers them. Everyone is not made for a college education, but just want to work hard and make a decent living wage to support a family or other loved ones. Now if welfare is needed, these are the ones I would want to help, not the lazy ones who think they are entitled.

  18. My Dad told me, before the age of twelve when my first job was delivering the morning
    newspaper for( (5 years), Son, if want to buy something and you have the CASH then
    buy it. If you don’t have the CASH…wait. More than likely by the time ypou have saved
    enough to buy that item you will have forgotten what it was you saved for…or not even
    want it by then. That wisdom has lasted me for 65 years After that time I have three
    homes that never had a mortgage and a lot more than $525,000 cash in the bank. My

  19. The overall spirit and mindset that informed the founders of our nation was driven by two things (prmarily): virtue and discernment. The reader can look up these words if they aren’t sure the meanings. These characteristics have been largely lost in our citizenry in the past 50 years or so…I would say since the 1960s. If we can find a way to regain these traits in a majority of our population, we will have started to turn around our country. I pray for this regularly. It’s not happening yet, but who knows what the future holds.

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