I haven't written an article in some time. Mostly due to the fact I have moved states and just settling into my new home. But there is a less obvious fact that has been evading me, I have nothing to write about. Then like most ideas it hit my like a train, the housing crisis that is looming large over the majority of the United States. For all of you that do not know, the United States is soon to be stricken with a house crisis of unbelievable proportion. This like many other crisis is due to the greed of a few. The last major housing crisis we had was in 2008, when mortgage lenders turned a blind eye to who they we giving out loans to furthermore the banks ignored the problem, creating an empire built on straws of terrible CDOs (collateralized debt obligations) and bunding all of the greed of thousands of people and selling them to gullible investors.

Today, we have the same problem, no banks aren't selling people bad CDOs, no, but they are still greedy, actually even worse than that. Is as a society, we have been played. Let me explain.   

Let me start off by saying, that the majority of Americans are in debt. I am not talking about light debt but debt to point in which your income-to-debt ratio is beyond sustainable. The average income in America is $31,133, but let's be generous and say you got a college degree, a bachelor's degree even. So your annual income is $100,164, pretty impressive but is it impressive enough. With the average debt of an American sitting around $52, 940, roughly half of your annual income now belongs debt. You are now sitting with $47,060 in liquid cash that you can use, but let be realistic, you need to eat, have fun, you need to live, so lets include some activities and luxuries. You like to watch TV, so lets factor in your subscriptions to Hulu, Netflix, and Disney+ setting you back annually around $400. That gives a whole $46,640 to use, oh wait there is more. If you factor in the average American and how much they consume per year, luxuries, fun every now and then that gives us that amazing number of -15,976. If you are wondering how I got that number, income - debt - the average yearly expenses of a US consumer in 2019. So no, my math is not perfect, and is not a one size fits all, there are many other factors and things to calculate but the point I am trying to create is, you have to cut back somewhere. Most Americans are excluding a mortgage and foregoing buying a house. Instead, many Americans are choosing to rent which depending on the situation can yield a negative ROI. Yet this is not the issue, the issue is we have been played. Here is how:

Let say you do decide to rent, depending on your age and your type of work might not be a bad idea, if you are young, it is probably your best idea. Let use the same scenario I displayed before. You are recently graduated college student with a bachelor's degree making $100,164 a year. Pretty good, then I begged the question is it good enough, no it is not but it easily can be. Here is what I mean by you have been played. Many of us are taught to work hard, pay our bills, get a house, save a little and retire when you in your late 60's and enjoy the rest of your life. WRONG. I can not stress this enough, that is unbelievably wrong it's painful. Now I am not going to tell you there is a one-stop solution to a life path designed by the rich to keep them wealthy and you poor. But there is some ways there kind is. Option 1, you win the lottery, unlikely with odds sitting around 1 in 13,983,816, but it is an option. Option 2, found your own company and strike gold, better odds than the lottery, sitting around 20%, yet still not as likely. Option 3, invest, the S&P 500 has an average yearly return of 5.9%, which if you put all your money in can return you yearly about $6,000! This would also mean you would go broke, hungry, and be incredibly late on every single one of your bills. Option 3, is a great option and should be looked into, with even the smallest of money but it will not solve any of your problems until you are in your late 60's and ready to retire. Option 4, play the game, financial freedom is not easy, this may be the land of the free but it is surely not the land of the financially free. You need to work and do not mean work hard at your job, this is like when your teachers in grade school would say to achieve an A in my class you have to go above and beyond, financial freedom is getting an A on life, you need to go above and beyond. So how do you play the game. 

Step 1: 

Educate yourself. I do not mean go get further schooling, honestly I think college is a waste of time and money with around 28% of all 4-year universities yielding a negative ROI. What I do mean is do research, look into the stock market, do not be lazing and toss your money into the S&P 500 and call it a day or rely on a broker to make money for you, no do it yourself because at the end of the day, you are truly the only one who cares about your money. If you want to advice on how to start investing into the stock market, read "The Intelligent Investor" by Benjamin Graham is one of my personal favorites. Yet if you do not want to read email or write professors at notable colleges to discuss investing with you, in my experience most professors are willing to talk and if they are not that is okay as well. You have the greatest library in history at your disposal, the Internet. 

Step 2:

Once you have found all the knowledge about investing, it is time to find what to invest into. Step 2 becomes quite tricky, you might strike out a few times but as long as you keep your eye on the ball, you will have good opportunity to get a hit. (Sorry I love sport analogies, I can't help myself). There are many outlets to invest into outside of the traditional route that is the stock market. One of my personal favorite outlets to invest into is sport cards, yes you read that correctly, sport memorabilia. I know watch so much sports, that I have picked up a knack for finding players in their rookie year that might become a stand out in the future. I would start buying some Justin Herbert (NFL), Kai Jones (NBA), Miles McBride (NBA) cards. Beyond sports cards their is the crypto market, from NFTs to tokens to real estate even at a small scale, some people even buy and sell koi fish. Before I invested my first dollar, I was a full time clothing and shoe reseller. 

Step 3:

Do what you love. That is my best piece of advice, I loved shoes and I was able to parlay that into cash in my pocket. There are millions of ways to make money, find what you love and see how can make doing what you love, trust me there is a way.

In conclusion, yes we heading into a housing crisis because right now it is does not make sense for many if not the majority of people to buy a home in the United States, so instead many are renting leaving thousands of homes available to rich investors to snatch up and hold which in turn will increase housing prices and rent across the nation. This will set us up for a housing crisis that will hit in the next 20 years in which, income - debt does not equal viability in the United States. So my suggestion in the short term is invest, make enough money to buy a home, you don't even have to live in it, you can rent it, Airbnb it, but owning a home will become invaluable at a point. There will be a point in which prices of homes rise so much that almost no one can afford to buy a home, crashing the market and resitting it once again. This is a common occurrence in the United States, it is how our housing market is design, it design to be flawed, to rise and then drop and repeat. The only protective measure against the everlasting wave of price changes in the US house market is to have cash on hand to buy when the market drops and sell before it crashes. Because like I said before in my last article, America is not a country, it is a business. Everything must be treated as such, including the place you sleep at night. 

- Hypothetical