The Urban Institute is reporting the results of their latest survey that highlights the fact that a significant percentage of American households can’t afford their basic needs – food and housing. This information is released at the same time that US stock owners are celebrating the longest “bull market” in history. How is this possible? First, eighty-four percent of U.S. stock is owned by just 10% of the American population. Second, Corporate America has propped up their stock prices through share buybacks and growing dividends, while investing far less in plant, equipment, inventory, jobs, and wages.

Furthermore, real wage growth has been muted for decades, while the return on capital has grown substantially rewarding those that own the companies but shortchanging the American worker, who is now struggling to meet their basic needs. This is clearly an unsustainable development.

In a recent blog post, we highlighted the fact that buying one’s starter home is becoming much more difficult, as the percentage of one’s income needed to fund a house purchase continues to escalate, and in some markets to outrageous levels (see NYC and San Francisco). Given the lack of disposable income for many Americans, is it truly realistic to have them fund and manage a self-directed retirement program?