Act before the end of the year. One person is in custody after a shooting at a National Guard armory north of memphis, tennessee, who people are shot and are recovering tonight. The gunman was subdued by other soldiers. The fire chief said the victims and the suspect all work for National Guard. Pirates are holding the american captain of a ship, 11 other crew members are released, the nigh jeerans are searching for remaining crew members. Thats it for al jazeera, real money with ali velshi is next on al jazeera america. Theyve got good credit and an up or down payment. Why cant the majority of americans cant buy a home. And Social Security is it there for you to retire . And twitter goes on sale by as early as november 7th but does it have the right game plan . Im ali velshi and this is real money. This is real money. You are the most important part of the show so join our live conversation with the next half hour, use the real money. The bad news, homes are becoming less affordable. I want to talk to you about Home Affordability. The most important factor in the equation is your income. The next is the actual price of the home. The mortgage, not just the rate but how much it is going to be. You figure that out by calculating what percentage of your income will go to your mortgage payment on a monthly basis. The National Association of realtors take all those factors into account in its monthly Home Affordability index. This is the way its look like in the last year. It shows nationwide, affordability has come down from last august to this august. That means more americans who have good credit, 20 down who qualify for a 30 year fixed Rate Mortgage cant afford to buy a home where they live. The obvious culprits are rising home prices and higher Mortgage Rates. Now not all markets are the same. Real estate is always local and trulia a real estate Mortgage Firm has crunched numbers for 99 markets across the country. Those figures show california, massachusetts, new york even austin, texas are pricing out middle class buyers. 50 of the houses for sale are beyond the reach of americas middle class and that is a worrying trend. Jud kulco is joining me now, on why owning a home is less of a reality for middle class americans. Jud good to see you. Lets use boston as an example. A year ago, more than half the homes in boston were affordable according to this measure. Now its down to about a third . Its fallen for two reasons, home prices are up and Mortgage Rates are higher than they were a year ago. Even though rates have come down a little bit, we saw a big spike in Mortgage Rates in may and june. A lot of that had to do with expectations about what the fed would do. Now all bets are off in terms of what the rest of the government would do with housing. But thats what sent rates up. That all considered, that means homes are less affordable to buy in pretty much h everywhere in e country. What does that mean economically . It means that the rich can buy homes and others get sort of priced out . It means that the rich can buy homes. Lots of people who cant afford to buy are either representing or theyre looking for smaller places. Many are doubling up. As part of this recession we saw more young people still living with their parents, or with roommates more than they did before the recession. Affordability is a big driver that explains why people move from some parts of the country to another. In california for instance where housing is one of the most expensive places in the country we see lots of people moving from california elsewhere and its most reply lower and middle income people who are leaving california typically for places where housing is a lot more affordable. Economically, thats weird, you end up with centers where housing is more expensive and people cant afford to live there and it forms a mix of society, prior to 2007, 2006, it was worse. People who didnt have a higher income couldnt get affordability in a lot of places. Thats right. Even though affordability has declined over the past year, housing still looks more affordable today than it did during the bubble. Thats because prices are still lower than today and Mortgage Rates even though theyve gone up from a year ago are still much lower. Remember rates were in the 6s during the real estate bubble. Thats the high 98. During the 90s they were in the 6s and 7s and some remember double digit rates in the 80s. Theres more to it when it comes to affordability. The idea of space, the amount of space you get in an affordable home in places like San Francisco and new york very different from cincinnati or atlanta for instance. Thats right. The typical home, looking at homes that are affordable to the lower middle class, the affordable home could be 1500 square feet, that is a good sized two or even three bedroom house in the midwest like cincinnati. Affordable homes may be only 1,000 square feet in San Francisco or even less in atlanta. Its an are interesting metric jed. Good to see you here. Jed kulko, chief economist at trulia. Currently building two custom made homes and four town houses. Charles good to see you. How is business for you . Great, couldnt be better. Tell me about whats going on. Were talking about Housing Affordability situation, youre seeing Interest Rates rising a little bit and where are prices going where you are . Prices keep going up. You see it really every spring they kind of go up a little bit more. Things are just things have been really good in houston and you know i have to attribute a lot of it to the Energy Industry here. Youve got allot of young people moving into houston every week. So its just you know things could not be better. Its just its a great economy, right now you try and get land as builders you try and find lots and you cant even get them because there are so many people competing for them. A lot of them are cash buyers. Cash speaks louder than borrowing money. Are you worried about sustainability of this business . While its going well youre not asking questions . You know a little bit of both. You always worry about when its going to stop. I mean we saw in 2008, somebody put the brakes on and we all flew out of the car. But you know we always worry about it as builders. Weve got a lot of money out there on the line and you get too much out there you get in trouble when somebody hits the brakes. So we always worry about it but i think its got a little bit of time left. Who knows how long . But things are going really well right now. You know we see this Mortgage Rate increase, we see a bunch of things going on in the economy but were still hearing that housing is strong. Whats your sense of the market . I know you dont have a whole lot in process but is housing stronger or weaker . Its much stronger. I think every year we had a reblild from 2008 to maybe around with 2010, 2011 and then it just took off. It seems every year we see large jumps, percentage jumps in real estate and you know, the price of the homes, when we do speculative homes you see the price of the speculative home jump quite a bit from one year to the next. As far as new construction its very difficult to get say a town home under contract. They go very quickly. So were seeing things increase, every year. And id see it Getting Better in 2014. Beyond that i dont know whats going ohappen but i do know that next year looks like its going to be a strong year again. Typically of contractors, its you or your brother who are the owners and the employees really the only two staff of the company. Right. As your business ebbs and flows, you hire contractors. Right. We keep it lean. We dont like to keep a lot of glows open the payroll. Everything is we use subcontractors for what we do. And its just easier to manage it for us. And do you have enough workers . Absolutely. You know i will say this our workers have been with us for many years. Probably most of our subs have been with us for ten years so it makes it easier. But we are seeing our supply is making it much more difficult to get things delivered. Lumber, windows, doors, roofing materials stuff like that because so many people are building right now. Wow. And it used to be you would call a rep from a lumber company and they would call you right back and now they call you back in two days. Well may business continue to be as well as it is for you now. Ill have to visit and see how its doing. Builder of custom homes in houston. The slow down in refinancing applications is taking its toll. Bank of america is cutting 3,000 mortgage related positions by the end of the year. The cuts will likely hit new york and california. B of a is not the only. Higher Mortgage Rates have led to fewer refinance applications and is leading to a mortgage industry that is shrinking. More than 60 billion pay for it for a look at Social Security, what any of us are willing to take the bitter medicine. Keep it here. News stories . It drives discussion across america. Share your story on tv and online. Polls show that a majorities of americans are afraid that Social Security is headed towards a crisis and that action has to be taken. Most politicians though say that making changes to Social Security is political suicide. But solving our budget something has got to give. Loosely taken, you could break the budget into almost three equal quarters, one is the military, the Fourth Quarter is everything else. Lets look closer though at Social Security. Nearly 60 million americans get Social Security checks every month but this social insurance also cost taxpayers hundreds of billions of dollars in year. We need to figure out how to pay for it. Ill tray 00 look at that in a minute. However, duarte looks at Social Security. Social security was born during the Great Depression where millions of americans, especially Senior Citizens were living in poverty. It was designed to meet their basic needs. Today nearly 40 million workers and their dependents, about 11 million disabled workers and their dependents get 1129 dollars in all. 816 billion in Social Security benefits were paid out last fiscal year. To pay for that, 6. 2 of every dollar American Workers earn is dropped into a pot to fund Social Security. Employers add an equal amount. That combined with Interest Income is how the pot is filled. Here is the problem. The wave of baby boomers tapping into benefits means the Social Security trust fund wont have enough money by 2033. According to the Economic Policy institute. After that period, we wont have quite enough money coming in through current payroll taxes to pay for scheduled benefits. Well have about enough to cover about 77 of scheduled benefits. But that would still be a big cut in benefits if nothing were done in advance. The solutions to the Social Security problem include raising taxes taxing what more wealthy people earn or raising benefits, another idea, raising the time when people can take benefits. The problem, none of those solutions are popular. Would you take reduced Social Security benefits at 62 years old . Or the full amount at 70 . Season 01 said i would take reduced at 62 and still work part time as allowed. I would enjoy it more than waiting. John bollinger says, i will work as long as possible and go for the max. Tell me what you think by tweeting me ali velshi. None of the solutions to solve the problems of Social Security going broke 20 years from now are popular with voters. Firming Social Security isnt sexy perhaps we the people are partially to blame for an ailing Social Security system. At least thats view of david leon hart, an author of an excellent short ebook that you should read called heres the deal, that explains entitlements better than ive ever heard. A quote from your book, i want to read it to my viewers. Eventually the country will have to confront the deficit you we have rather than the deficit we imagine. The one we imagine is a deficit caused by waste, fraud, abuse, foreign aid, Oil Industry Subsidies and vague out of control spending. The one we have is caused by the worlds highest health costs by far, the Worlds Largest military by far, the Social Security benefit that was created when most people died at the age of 70. The book talks about these entitlements, two areas that americans dont want to give up and two areas politicians treat as third rail. So what are we supposed to do about it . Well, the good news and thank you. The good news is, this isnt an emergency today. The deficits coming down fairly rapidly. It is getting below the point where its some sort of emergency. The rest of the world remains very happy to lend money to the united states. So we have some time to deal with this long term deficit. The bad news is that i dont think theres a huge amount of realism about what has caused it. I think most people like to think about the idea that the other people has paid too little, getting too much. The fact is that as a society were not taxing ourselves for the benefits weve promised ourselves. The solution is bringing down benefits or bringing up taxes. People dont love this. By the way, the tweets will start coming in. I called Social Security entitlement. What is the answer to that . Thats a term. There is no scientific answer to that. People can debate that. While Social Security isnt creating any of our problems, in the long term it will cause very big problems for our finances. It is not set up in a way that it is sustainable. The fixes are not radical. You could do any number of tweaks to the tax rate or to the benefits. You could increase the tax rate, you could increase the tax rate for high income people, you could decrease benefits, you could decrease benefits just for high income people. The only way to keep it going would be for it to be a drain on the rest of the federal budget. I dont think youve got a dog in this fight any different than anybody who pace taxes has a dog in this fight. We are generally speaking net takers meaning we take out of these programs generally more than we put in. Most people think its not the case. In your book you use an example of two married retirees with typical earnings paying about 88,000 into these programs but receiving three times the amount in benefits, more than 380,000 in benefits. The example could be anybody watching this show here. Thats right. People basically pay for themselves in terms of Social Security. But the issue is really medicare. Look, obviously someone who pairs into the medicare system their whole life and say dies at 66 pays for themselves about the the average person doesnt come close to paying for them sesms. That is contrary to particular belief. Hey, i simply take out what i put in. But the answer is you are not. We have the worlds most Expensive Health care system as a result you get in terms of dollar value then you put in. David always a pleasure to talk to you. Thank you for enlightening us. David is the author of an ebook called heres the deal. Now we know what twitter thinks twitter is worth. Well give you the latest details about the ipo and how the company that may tweet more than a bird sound, will become a grown up business. Well, twitter is another step towards becoming a public company. 70 million shares at a price between 17 and 20 appease. Thats a deal near 1. 4 billion, the largest ipo since facebook. Because all the shares in the company will not be available to the public. Enough about numbers. Vivian shill err will run twitters news and journalist partnerships, one that you wouldnt expect existed. What is twitter up to, jeff covers media and tech and joins us via skype. She is an nbc executive, she headed npr before this, she was at cnn before that. Whats twitter doing with that . Well twitter has increasingly over the last few years making their partnerships with media companies, Media Outlets a bigger and bigger strategy. The idea is to integrate those services. A lot of which as you importanted out she already has experience with and basically get them to integrate twitter in all kinds of ways. News gathering, actually using twitter as a reporting tool to using twitter to distribute their news to readers, to as you do doing onair polls, things like that. We definitely use it, theres no question that journalists have begun to use twitter, breaking news it helps you sometimes it hurts you but i can help you confirm stories. How does this all relate to my viewer whos looking to wonder if they should buy twitter and other individuals, who shouldnt buy stocks, we buy stocks of names we know. Whats the relationship between this interesting Business Strategy with partnerships and all of that versus twitter the company thats supposed to be there to send messages out . The important thing is that twitter needs to grow more. Their prospectus, their growth has basically plateaued, not like these hot digital stocks doing the hockey stick thing. They picked up only a million new users in the last quarter. So their gambling is, or their proposition is that the way that theyre going to find this new second wave of growth now that theyre past the kind of early adopters is by you know blending twitter in kind of everywhere you look whether youre reading the newspaper or watching Television Twitter is a part of what youre doing and people are talking about that on twitter. Parts of that is you have described twitter as spikey, fairways seems like a meandering type of discussion and twitter seems big when things are. Happening and not the other time. Twitter has huge spikes of usage around the oscars or super bowl. But they have these lulls afterwards. So if twitter can you know what they need to do is when they have these spikes they need to sort of settle on a new level afterwards and thats a lot of what theyre doing around television is around trying to turn twitter into more of a daily habit. Interesting, jeff good to talk to you. Thanks for bringing us some perspective on this. We will continue to cover this on twitter. Good to see you. Dont forget our question. Would you take reduced Social Security at 62 or wait for the full amount at 70 . If you want to see more about our stories log on to aljazeera. Com real money. Turns out americans are mediocre students, 10th out of 14 industrialized countries that were surveyed. They are bad at math ranking third lowest of all countries ahead of only italy and spain. My home country of canada didnt can do great in math either. At least japan was in the top seven, with finland coming in a close second. Being good at stem, as we call it and making a decent salary. Correlation is the strongest here in the united states. Health of the economy and your own wallet. It is a big deal in the coming weeks. Im going to bring you more about what private entrepreneurs and the doing more. When david took on goliath, david was no underdog. Im ali velshi. Thanks for joining us. What happens when social media uncovers unheard, fascinating news stories . It drives discussion across america. Share your story on tv and online. Hi, im Lisa Fletcher and you are in the stream. A nickel mine in minnesota is it a false choice to tell minnesotians they have to choose when work and the environment . Our digital producer, wajahat ali is here and he is bringing in all of your comments and questions via our social networks. Waj is lot of people in our community didnt know about the controversy