Check Out the Median Income Over Time
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I just came across this chart I made a few months ago. It’s the median income adjusted for inflation from 1984 to 2010. I think it’s very interesting. I don’t remember the point I was trying to make when I originally made the chart but it’s interesting none the less.
Our income is about where it was back in 1997. We were doing well in the 80′s followed by the recession in the 90s. Then we took off again but that was curbed in 2000. Tech bubble burst? 9-11? I’m not sure. But we had a short recovery and then the housing bubble burst and it’s been going down ever since.
Will we recover? I have no doubt that we will. When? I don’t know.
Another question I have about this chart is does “adjusted for inflation” cover things like the invention of cell phones and the internet? Those were bills our parents didn’t have to pay in 1984. So do we actually need to have more income to live an average life? Or is that kind of thing included when we adjust for inflation. I mean, I know I can’t buy a gallon of milk for .50 anymore but I also have a whole host of other bills that I wouldn’t have if I lived a 1984 lifestyle.
What do you see when you look at this chart?
Ashley
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I think globalization will continue to push down median income in the U.S. until it’s equalized with emerging powers in Asia and South America. Where the bottom will be I have no idea, but the average annual household income in China (to give one example) today is in the vicinity of $10,000. Once rough equalization occurs, the door would be open for global incomes to rise in concert.