Real Wages

"Real wage increases require three things: First, the society must save money so that it has capital to invest. Second, it must invest the savings in profitable businesses. Third, these capital investments must result in increased productivity.

Alas, none of these things happened. Insead, these three critical things began trending in the wrong direction. National savings - including public savings - fell from 7.7 percent in the 1970s to only three percent by 1990. Business investment fell from 18.6 percent of GDP in the 1970s to 17.4 percent in the 1980s. And productivity? In the 25 years after World War II, output per employee had risen at an average rate of 2.8 percent per year. During the 1980s, this rate fell to less than 1 percent.

There was a bump in productivity after 1995, but this was largely a feature of the Labor Department's new way of calculating it. With falling savings, falling business investment, and (consequently) falling productivity, you could not expect the economy to do very well. It didn't"

"Empire of Debt", Chapter on Reagan's Legacy p 202, Bonner Wiggin, Agora press 2006

Unbiased Mortgage advice

I like Jack Guttentag, the wharton prof who advises on mortgages in his webpage http://www.mtgprofessor.com. I find less bias in his advice. Here is a good tip:

Some borrowers are allergic to calculators and need a rule of thumb. Unfortunately, the common one that says "consolidation is profitable if the rate on the first mortgage is below the rate on non-mortgage debt", is wrong most of the time. Replace it with "consolidation is profitable if the rate on the first mortgage is below the rate on non-mortgage debt, and if the rate or mortgage insurance premium on the first mortgage is no higher with consolidation than without." This one will be right most of the time.

Full text is at http://www.mtgprofessor.com/A%20-%20Debt%20Consolidation/consolidating_with_new_first_mortgage.htm