Is Everything We Think We Know About Income Mobility Wrong?

[badlydrawnjeff.livejournal.com]

The video above was put out in February of this year, so it's not really in response to any current happenings as much as a statement of what appears to be true. Granted, I had some skepticism, and then I unrelatedly found this release:

Washington DC--The Treasury Department today released a study on income mobility of U.S. taxpayers from 1996 through 2005.

The study showed that, just as in the previous 10-year period, a majority of American taxpayers move from one income group to another over time. The study also recognizes that the dynamism of the U.S. economy significantly contributes to income mobility.

The study itself is quite illuminating - I was fairly accepting of the idea that income mobility generally doesn't happen, even if the framework exists for it, but the data appears to be completely destroying that viewpoint for me. Now, granted, the last few economic years have almost certainly slowed this, but this is new information for me, and it also puts into question about the overall stagnancy of wages - are we truly seeing stagnant wages, or are we simply seeing people replaced in income brackets as others move up?

Is everything we think we know about income mobility wrong?