The Middle Class has been in a bit of a pickle lately. The cost of housing, food, utilities have all been going up but our salaries haven’t been rising at the same pace. Everything we need to survive has been becoming really expensive and pay cheques have stayed the same.
To compensate for our rising costs the Middle Class has been putting all of these more expensive products on lines of credit and mortgages because we don’t have the extra money to cover these growing expenses. Canadians now owe $163 to every $100 they make after tax. It’s the highest level since they tracked this data.
The problem with an economy that doesn’t grow on real growth but only on cheap debt is that when interest rates go up you now only have a zero salary growth Middle Class you also have a shrinking amount of money they can keep buying things because the increasing interest payments soak up the fixed monthly income.
So how do we get the Middle Class salaries to grow and debt to go down? Dividends. Some of the money that Corporate Canada is paying out to shareholders should be paid out to great employees. All of the hard work that the everyday tellers, accountants, managers, etc. could use the money more than the few shareholders. Even a small “sliver” would make a huge effect of the total dividends paid to shareholders. It would be great to watch the ripple effect of our workforce getting new cars, paying off debt, buying or renovating homes but with cash not on credit cards or loans.
The stock market has gone up since February 2009 and all of the shareholders have made great money. Now let’s pay out part of those big dividend cheques to the people whose hard work made it go up. The economy will benefit and a real way not just paper housing increases or paper stock market gains. Dividends to the People!
Have a great week,