Yes, they really are Two Americas.

Some weeks ago we had lunch with a high income high net worth person who had been introduced to us with the idea they might want to consider doing stock and bond investing and trading our way  

The lunch conversation was about how smart investors and traders survey the financial and political environment and do not try to change it,  but rather take advantage of it. Simply put the country is becoming more and more divided between those who are upper middle class and above and those who are lower middle class and below.  There are less and less people in the once largest American class the true middle class.  This is the result of decades of public education doing a worse and worse job of educating the middle class on how to achieve the once wonderful American Dream of financial security at some point in their lives.  In has been further pushed by the erosion of a common core of values held by most Americans. The results of this downsizing of the American Dream is clearly shown in Friday's jobs report where despite being hailed by many as great the truth is we continue to replace full time higher pay jobs with part time and lower paid positions.  All this is being embedded into place by current political economics and financial engineering. 

Thus we have a situation where there is less hope to improve one's life and even less desire to do so. However for those who have made the jump to the shall we call it "good life" the opportunities to keep that way of life are quite numerous and most rewarding financially.  We have long opined here that with Obama the federal government has embedded in many Americans the desire to just accept what crumbs of money and goodies the government gives you plus  maybe some part time with no future employment as something everyone in the lower middle class and below should be just happy with and be quiet.  On the other hand these same political policies that involve lots of deficit spending have lead to the situation where those who have made it in this country along with the financial engineering by the Federal Reserve of low rates which enable mega sized corporations to pay good dividends and buy back stock make the upper class richer by the day.  Those in the upper middle class and above see the federal government largess under Obama as being nothing more than throwing some candy to the masses to keep them quiet, while the better off dine out well, drive fine cars, and vacation at their beach homes. 

This is not the way it should be or has been in America, but until someone pulls the plug on this arrangement at the ballot box and in their daily living values it will not change.  As I said to my lunch person "it IS what it IS whether you like it or not and only fools do not invest and trade with the flow." There are days now when we wonder if America has finally jumped the shark and can never find the American exceptionism that once made us the land of opportunity for anyone who wanted to try.  We have traded equal opportunity for equal misery, unless you happen to be blessed to be in the priviledged class. Most days now we consider ourselves blessed we are not in the bottom group. Most days too we wish we knew how to change the dynamics to the way it was when everyone had a good paying job with a future and the chance to move up in lifestyle and leave a better American for their children.  But until that day when the masses decide they too want a piece of the good life and elect pro growth politicians who EXPAND the wealth pie, instead electing those who think of just dividing the pie that is there we will do as others are doing in the upper class and above and continue to take from the lower middle class and below and expand our own personal wealth.  This is the side of the so called financial inequality that one must as we said go with the flow. 

If you have any chance to get into the expanding wealth category your best option is to avoid the masses and get a good paying job of those few that are available by learning a skill that is in demand then investing your paycheck like a religion in mega cap ETF's or mutual funds.  Savings rates of at least 15% and preferably more is needed and put it on autopilot. As we have suggested here ad nauseam use Vanguard Funds as your investment choice, which are cheap and investor owned too. Yes we all hope that new policies will change the current economic landscape, but smart people know to work hard and go with the flow.