Banks making everyone poorer. Middle Class Poverty Rising.

Seemingly low interest rates have allowed consumers of credit ie, housing loans to believe they can afford to risk much higher borrowings. Banks have been calculating that customers can repay much higher levels of their household income, so much so, that many households are left without enough to fund required consumption ie. they are living in poverty.

Many people may have a house to repay that is sucking a huge proportion of their income, this has been a strategic policy developed by the banks to put borrowers at risk of losing deposits.

By under estimating household expenses the banks can sell the customers much higher loans for housing, these low measures are targeted at middle income families.

Banks actually are using a "poverty index" to calculate the size of potential loans, ie. how much the clients can repay and still survive in poverty. Middle income people are highly leveraged, they spend more of their incomes on loan repayments than people on low or higher incomes. Their assets are undiversified and are generally nothing more than the family home and a superannuation policy.

Houses can become very difficult to sell in a period of rising interest rates, and this is likely to become reality for many in the near future. Many middle class people have no income besides their jobs, and these are less secure than ever before.

Whilst low income people have little assets they tend to have much lower debt, and high income people generally have other income streams and diversity of assets.

The worst thing is that middle income people cannot afford the proper levels of insurance, often they are under insured for the value of their homes, and rarely hold income protection insurance.

Could it be in the interests of the Global elite to destroy the middle class? Certainly wages policy and controlled crisis's are causing a massive decline in the once majority middle class. Financial system members like banks are playing their part in changing the way people live in our modern world.

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