Weakness Begets More Weakness - Sprott Asset Management
Other than some obligatory arrests for disorderly conduct, the Occupy
Wall Street movement celebrated its one year anniversary this past
September with little fanfare. While the movement seems to have lost
momentum, at least temporarily, it did succeed in showcasing the growing
sense of unease felt among a large segment of the US population – a
group the Occupy movement shrewdly referred to as “the 99%”. The 99%
means different things to different people, but to us, the 99%
represents the US consumer. It represents the majority of Americans who
are neither wealthy nor impoverished and whose spending power makes up
approximately 71% of the US economy. It is the purchasing power of this
massive, amorphous group that drives the US economy forward. The
problem, however, is that four years into a so-called recovery, this
group is still being financially squeezed from every possible angle,
making it very difficult for them to maintain their standard of living,
let alone increase their levels of consumption.
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