In a simply extraordinary presentation titled “Generations X and Y: Facing Economic and Financial Challenges in the Shadow of the Baby Boom,” Bill Emmons does a remarkable job of mining available data to paint a picture of where we are and how we got here.

This deck, in its entirety, is one of the best pieces of research I’ve seen since the beginning of the crisis. I’d like to thank Dr. Emmons for granting me permission to share his work.

Herewith some of the highlights and takeaways:

Income inequality is clearly visible in the growing gap between mean and median incomes.





This slide is so telling: Households headed by those over 65 have recovered — and then some — from the recession. Not so all the younger cohorts:





Here’s another very telling slide, reflecting the fact that it’s not so much that those with college degrees are doing particularly well, it’s that everyone else is doing significantly worse. This is a stunner:





Look what happened to the mean wealth of the under-40 cohort. Is it any wonder they’re living in Mom and Dad’s basement, not fueling household formation, and not spending money like drunken sailors?





Why did they lose so much? Because they were loaded up with too much house, and when the bubble burst, it crushed them:





Younger families had also amassed too much debt:





Put it all together and, as this slide states: “Homeownership Rates Are Plunging Among the Non-Elderly”:





The picture going forward is not a particularly happy one:





The medicine might not taste good, but this is what it might take to improve the outlook:





And there are some reasons to be hopeful:



