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America's 1% Has Taken $50T From the Bottom 90%

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Re: America's 1% Has Taken $50T From the Bottom 90%

#91

Post by throwawaysea »

Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

Your example is contrived. Assets don't have to go up in value. You could also end up holding the bag in a place like Detroit. You may not end up being able to rent out your second property at a profit. You may end up with a deadbeat tenant, unforeseen expenses, or simply falling rents. These decisions involve risk and they have accordingly, an associated reward. Claiming that there's a "natural law of wealth" doesn't seem as obvious as you're making it out to be.

Re: America's 1% Has Taken $50T From the Bottom 90%

#92

Post by DamnYuppie »

RIMR wrote: post #83
natenthe wrote: post #57

Correction: The Fed's policies have taken $50T of wealth from the Bottom 90%. When you bail out irresponsibly over-leveraged and nearly bankrupted banks and corporations, and pay for those bailouts with tax-payer money, you steal from the poor and give to the rich. Most importantly, when the Fed decides to print money ad nauseam, they create massive asset inflation, which steals from the poor and gives to the rich. T…

Lack of education is the #1 issue here. America's education system emphasizes nationalism and obedience. It doesn't encourage critical thinking or alternative worldviews. We're so deeply entrenched in the "American Dream" (Capitalism & Trickle Down Economics) that we're unable to challenge the current status quo. Worse yet, this is driving us towards the defunding of public education, and the further worsening of our…

I agree with your assessment of our education system. I would go further and say we intentionally do not teach money management skills as it makes people harder to fleece. We have indoctrinated a whole country that debt is good, rampant consumerism is good, all of which leads to really bad money management.

I am of the opinion that these habits and the ideology that supports it is the biggest reason people who are in the lower income brackets continually stay there. The best path to wealth is to convert your work into capital. If you spend everything you make and more there is no excess to re-invest.

Re: America's 1% Has Taken $50T From the Bottom 90%

#93

Post by AlexandrB »

throwawaysea wrote: post #72

"Taken" is a misleading and false. They aren't taking wealth. Others are giving them money in return for something they value. If I am selling a product, or my services, or a share of stock, I'm not "taking" anything from anyone. It's incredible to me that these casual editorialized titles are acceptable so broadly in the journalism industry, and yet labels like "fake news" are reserved for only right-leaning news me…

If you want to get into the nitty gritty, the 1% rich generally don't sell products or services. They own companies who employ workers who do these tasks. Some surplus portion of the value generated by those workers is then captured by the organization (and its owners) as profit. Whether you want to call that "taking" or not is a question of ideology, not of fact. Arguably, omitting the word "taken" from the headline would be editorializing as well.

Re: America's 1% Has Taken $50T From the Bottom 90%

#94

Post by ryanmercer »

bequanna wrote: post #79
ryanmercer wrote: post #32

Around the same time this was shared to HN I Tweeted/FB/LinkedIn variations of the following >If I earned $10,000 a day it would take me 273.97 years to have earned 1 billion dollars. Meanwhile, Elon was worth about 20 billion a year ago, last month he was worth an estimated $185bn. Oof. In reality, I make a little over $17 an hour His net worth increased an estimated 4.66 million times my annual gross income in the…

> If someone gave me 100,000 USD... The language you use here is concerning and not empowering. Why would someone 'give' you $100k? Despite some arguable edge cases (hft, etc.) money is only earned by creating value. > Some days I just "can't even". With my faith, my wife, my friends, I try to be upbeat and positive when it comes to the future but when I see people like Musk, Bezos, even Gates ... Comparison is the t…

>Why would someone 'give' you $100k?

It's an easily divisible example of what 1/1,600,000 of his net worth increase in the past year could do for a given individual.

Re: America's 1% Has Taken $50T From the Bottom 90%

#95

Post by Pfhreak »

throwawaysea wrote: post #91
Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

Your example is contrived. Assets don't have to go up in value. You could also end up holding the bag in a place like Detroit. You may not end up being able to rent out your second property at a profit. You may end up with a deadbeat tenant, unforeseen expenses, or simply falling rents. These decisions involve risk and they have accordingly, an associated reward. Claiming that there's a "natural law of wealth" doesn'…

My example is not contrived, it represents an understanding of the market over the long term. Are there bubbles? Yes. Are there dips? Yes.

You are making the inverse mistake of someone who looks at a large jackpot win in Vegas and thinks it's a good investment, when in reality the expected value of a bet is negative.

The rate of return on capital has held relatively steady at ~4% for hundreds of years. Stop thinking about individual winners and losers, and look at the broader picture. If you have sufficient capital, you can expect to return capital + n% over time, where n is approximately 4%.

Re: America's 1% Has Taken $50T From the Bottom 90%

#96

Post by namelessoracle »

slowhadoken wrote: post #67

She had me with the history of income inequality and then she lost me with “wage gap” talk. Why is a plea for bipartisanship always followed by throwing shade at white men? It’s wearing on me.

It's the poison pill that Amazon/Walmart/et cetra have injected into the conversation to make sure they keep on top. Unless you think that all the top 1% have adopted identity politics out of the goodness of their hearts? It's just classic divide and conquer strategy. It's no coincidence that identity politics is so popular with the relatively affluent tech community who dont want to take a good hard look at themselves.

I remember seeing a meme the other day about two justice systems in America, one black kid getting held for 3 months in jail, while a white kid with a more serious charge got out on bail immediately. Of course the meme framed it as a racial issue. The actual root cause was ya know, the white kid has a family who could pay or put up the bail while the black kid didn't, which means it was income inequality issue. But it sure seems there's a dedicated group that really really wants you to think its a racial issue.

And that you should spend your precious time, political capital, and energy fighting that racial issue over the wealth inequality one. And that you shouldn't ever ever ally with someone who would work with you on the inequality issue but disagrees with you about it being a racial one, because they are an icky nazi.

I wonder what exact group of people benefits from this perfectly engineered storm of division?

Trump got elected due to ultimately populist anger over wealth inequality. But telling a poor struggling white family that they are privileged is a great recipe for them to ignore actually prescriptive solutions to their problems and turn to people like Trump.

Ultimately, it's wearing on you. Because it's supposed to wear on you. It's supposed to remind you what happened to the kulaks last time income inequality was addressed. And not so subtly remind you that white men are the kulaks of the modern age.

Re: America's 1% Has Taken $50T From the Bottom 90%

#97

Post by gzer0 »

throwawaysea wrote: post #91
Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

Your example is contrived. Assets don't have to go up in value. You could also end up holding the bag in a place like Detroit. You may not end up being able to rent out your second property at a profit. You may end up with a deadbeat tenant, unforeseen expenses, or simply falling rents. These decisions involve risk and they have accordingly, an associated reward. Claiming that there's a "natural law of wealth" doesn'…

https://www.federalreserve.gov/monetarypolicy/bst_recenttren...

> "These decisions involve risk"

The Federal Reserve increased its balance sheet by about 6 trillion USD since March 2020.

There is no risk when you have the US Gov't backing you!

Edit: https://www.cnbc.com/2020/06/15/the-fed-says-it-is-going-to-...

Federal Reserve literally backing individual corporations at this point. Where's the risk?

Re: America's 1% Has Taken $50T From the Bottom 90%

#98

Post by jmcqk6 »

DamnYuppie wrote: post #92
RIMR wrote: post #83

Earlier quoted context omitted.

Lack of education is the #1 issue here. America's education system emphasizes nationalism and obedience. It doesn't encourage critical thinking or alternative worldviews. We're so deeply entrenched in the "American Dream" (Capitalism & Trickle Down Economics) that we're unable to challenge the current status quo. Worse yet, this is driving us towards the defunding of public education, and the further worsening of our…

I agree with your assessment of our education system. I would go further and say we intentionally do not teach money management skills as it makes people harder to fleece. We have indoctrinated a whole country that debt is good, rampant consumerism is good, all of which leads to really bad money management. I am of the opinion that these habits and the ideology that supports it is the biggest reason people who are in…

>intentionally do not teach money management skills as it makes people harder to fleece.

Yeah, this is a perfect example of "don't attribute to malice what is equally explainable by incompetence."

I'm not talking about the incompetence of teachers. I'm talking about the incompetence of the system, and it's inflexibility towards change. This is not caused by malice. It's caused by is being completely unable to effectively handle the millions of different perspectives of "what education should be."

You talk about indoctrination of a country, but I don't think it's indoctrination at all. It's people clinging to their views and being completely hostile to the idea that they might not understand important parts of the system. It's people turning to ideology instead of engaging with the actual complexity of the world.

Re: America's 1% Has Taken $50T From the Bottom 90%

#99

Post by Grustaf »

h3rsko wrote: post #2

Inequality seems to be a completely pointless buzzword to me. The only thing that matters is if there are more or less poor people, and how poor are those people compared to similar percentiles in the past. It shouldn't matter how rich the richest people on earth are. I really love seeing people on the Internet try to convince themselves that because Bezos or Musk are worth $100B, they must be stealing it from poor p…

> The only thing that matters is if there are more or less poor people

Up to a point I definitely agree with this, but the issue with some people being billionaires is not that they can drive around in Cadillacs made of gold, it's that they can and do control government policies, and use that power to the detriment of common people.

Re: America's 1% Has Taken $50T From the Bottom 90%

#100

Post by AlexandrB »

h3rsko wrote: post #2

Inequality seems to be a completely pointless buzzword to me. The only thing that matters is if there are more or less poor people, and how poor are those people compared to similar percentiles in the past. It shouldn't matter how rich the richest people on earth are. I really love seeing people on the Internet try to convince themselves that because Bezos or Musk are worth $100B, they must be stealing it from poor p…

> Inequality seems to be a completely pointless buzzword to me.

It seems pointless right up to the moment that those on the losing side of the equation start baying for blood. High inequality is often correlated with violent revolution[1].

[1] https://www.jstor.org/stable/10.1086/426881?seq=1

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