The days of college graduates having multiple job offers all over the world are clearly over. Their best bet now lies in moving in to mom's basement and taking bong hits with other 23 year olds in the same predicament. Mom and dad wouldnt mind so much, except that dad's real estate deal is $600k under water and mom's 401k is down 48% from its all-time high. Soon Junior gets married, and suddenly Lovely Laura is moving in also with a baby on the way. These 3 people will not be taking part in a process so stoked in tradition that it has never been questioned in almost 100 years: Household Formation. And as this scenario gets repeated millions of times, the only economic response is COLLAPSE. There can be nothing else. Everytime this happens, someone WILL NOT be giving mortgage business to a bank. WILL NOT be hiring a gardener. WILL NOT be needing new furniture. WILL NOT be paying property taxes. WILL NOT be buying a new car. WILL NOT be going to Vegas. WILL NOT be investing in the stock market. WILL NOT be very inclined to have real health care. WILL NOT be dining in fine restaurants. And on and on and on. So as the bubble-induced economic diaspora comes to a screeching halt, we will do something that in reality has been the case throughout 99% of mankind's history. Relying on and helping each other in a communal sort of way. Harsh economic realities now in effect for 3+ years haved forced even the most die-hard capitalists to realize this new reality. We will live with each other more often, nepotism will make a surging comeback from the highest to the lowest economic classes, and micro-socialism will be the norm among us as senseless economic policies are enacted merely as an attempt to placate the masses.
Aside from young graduates/new adults no longer taking part in the formation of new households, there also another dire situation taking place which is exacerbating the aforementioned phenomena: Household De-Formation. The number of men in the 30s living with their parents has also surged to all-time highs. So aside from a lack of new entrants into the household formation category, there are also millions of Gen Xers literally dropping out of society as we know it, and shacking up with mom and dad. Add to this the growing list of folks in their 70s and 80s who have been hit by the triple whammy of rising health care, zero interest on savings, and significant drops in 401k balances, and the holidays may soon be a time to get away from, rather than visit, the extended family.
Of course, a grand economic re-set would be one way to solve these problems. But that would entail a whole different class of folks taking huge economic hits. And those folks never take economic hits. You, on the other hand, do.
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