Lately everyone is worried about the stock market but I’m curious about how this affects low income people? I don’t have stocks, and I don’t have money in a bank, so how will this affect me if things get worse with the stock market?
The answer remains to be seen. Many jobs are created by businesses that borrow money. Many businesses rely on lines of credit, even to make payroll– the money rolls in and everything balances a week later. What has happened is that the credit market has frozen. This makes expansion only possible with cash- again, many business use credit. It they need to wait to expand, hiring slows and low income people have fewer job opportunities.
The other issue going on is inflation- our dollar continues to be worth less. This makes importing everything more expensive. It makes our exports more attractive, but most of our factories are already closed and not making anything. The other issue is that oil is traded in dollars. When the dollar drops in value relative to other currencies, the price of oil rises.