Feature

Gloom rises for middle class

And more of the week's best financial insight

Here are three of the week's top pieces of financial insight, gathered from around the web:

Your LinkedIn stunt double

Aspiring LinkedIn influencers are hiring ghostwriters to craft their self-promotional posts, said Rebecca Jennings in Vox. LinkedIn has positioned itself mainly as a social network "geared toward white-collar professionals seeking job opportunities or a talent pool to hire from." But this year, company has gone all-in on "creators," or users who hope to use LinkedIn "to build a personal brand by spouting entrepreneurial advice or nuggets of wisdom." There are currently 13 million users with "creator mode" turned on, "a setting that expands the kinds of features users can deploy to grow their audience." Many are turning to ghostwriters for their content. One said she charges $2,500 per month for her services — which include helping clients "game the algorithm" for the most engagement.

Gloom rises for middle class

The middle class is more nervous about the economy than it has been in years, said Shawn Donnan in Bloomberg. According to economists at the University of California, Berkeley, "in March, the average real wealth of the American middle class — including home equity and other physical assets as well as retirement and other savings — peaked at $393,300, the highest it's ever been." Since then, it has "fallen by about 7 percent, or by more than $27,000." It marks the end of "a five-year period of accumulation" that saw the average middle-class adult gain more than $120,000 in wealth, much of it tied up in property. But many of the beneficiaries of the bull market and rising home values have now turned pessimistic about their personal finances.

Sharp drop in home sales

The housing slowdown is speeding up, said Gabriella Cruz-Martinez in Yahoo Finance. There were 130,000 fewer new homes sold in September than the same time a year ago, a drop of 17.6 percent. "Sales of newly constructed homes dropped 10.9 percent from August." At the same time, "the median sales price of newly constructed homes was $470,600," up nearly 14 percent from a year ago. That's contributing to a "triple whammy" facing homebuyers, who have to contend with inflation, elevated home prices, and rising mortgage rates, which last week topped 7 percent for the first time since 2002. The inventory of previously owned homes for sale has fallen for eight consecutive months, and new single-family home starts dropped in September to their "lowest point since May 2020."

This article was first published in the latest issue of The Week magazine. If you want to read more like it, you can try six risk-free issues of the magazine here.

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