Tags: inflation | fast food | wage | riot

There Will Be Riots in the Streets

By    |   Monday, 12 May 2014 07:49 AM

There is coming a day in America where there will be widespread riots in the streets. And it will be over one thing — inflation.

Oh, the average "rioter" may not realize that's what it is. But that's what it will be from. You see, since 1970, inflation has gone up almost 2,000 percent, according to Inflationdata.com.

However, the minimum wage has only risen just over 350 percent during that same time. So inflation is WAY outpacing the low-end wage earner in America who flips burgers or is the greeter at Wal-Mart.

In fact, we saw the initial stages of unrest among this group in 2012 when workers from McDonalds and other fast-food establishments went on a strike for higher pay.

Well, I'm reminded about this whole ordeal once again because guess what's happening on May 15? Workers are striking in more than 150 cities across the nation over their pay, once again.

Workers from McDonalds, Wendy's, Burger King and KFC will be walking off the job that day and striking as they demand $15 per hour in pay. Now that's insane and they're never going to get that, even if they do end up getting some sort of pay hike.

In 2014, there are approximately 4 million people who work in the fast-food industry here in America. So you could see where this could get to be a very big deal if these strikes were to catch fire and become even more widespread.

And here's the problem. Inflation is going to continue to outpace their pay, no matter if they get a pay hike or not. So the gap between what things cost and their pay will continue to widen against them.

There will eventually become a tipping point, to where they will revolt and there will be riots in the streets. You see, America has gotten so poor that it's not just 16 year olds who are working at these wages anymore. Sometimes it's people in their 30s and 40s who don't really have marketable skills.

So when the inflation gap gets to a tipping point, the fast-food employees who are above the age of 18 and are supporting themselves are going to go nuts and you'll see things happening somewhat similar to what we saw happen in Greece.

Additionally, as pay hikes do eventually happen, the employment rate will go up among this group too, since the fast-food joint will only be able to employ so many people at that higher wage, as their profit margins are already small anyway.

(Wendy's has a profit margin that's below 2 percent! YUM brands, owner of KFC and Taco Bell have a profit margin of just over 8 percent, while McDonalds has a bit more wiggle room at a profit margin of just over 19 percent.)

Wendy's could literally go out of business if it has to hike wages by all that much, or at least shrink its footprint and close a ton of restaurants.

So as the unemployment rises among this group and those who are employed continue to lose ground against inflation, there will be a violent uproar. I'm not joking and I'm not exaggerating.

We've seen this happen in other countries. And I know people think that since this is America, it can't happen here. But trust me, it will happen here.

I'm not looking forward to it. I don't want it to happen. But I see the day when it's coming. It's hard to say exactly when this will happen.

But before 2012, we didn't have these workers walking off the job and striking. Now it's happening again in 2014, and on a larger scale than before. So from here, it only gets worse

The turmoil will get more frequent and more evident and then it will birth an all-out violent uproar in the streets that will be chaotic.

Those of you who know me know that I'm not known for my "gloom and doom" or fear mongering. But this is something I see coming in the years to come. We will see it in our lifetime and it may only be just a few short years away until it gets to this flash point.

About the Author: Sean Hyman
Sean Hyman is a member of the Moneynews Financial Brain Trust.
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There is coming a day in America where there will be widespread riots in the streets. And it will be over one thing — inflation.
inflation, fast food, wage, riot
Monday, 12 May 2014 07:49 AM
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