Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Rich people do have trouble understanding what it's like to be poor

salon.com

Post reply on HN
Print view View original

171–180 of 421 posts

Re: Rich people do have trouble understanding what it's like to be poor

#171

Post by em500 »

JKCalhoun wrote: post #121
zpeti wrote: post #75

Earlier quoted context omitted.

I would love to see a parallel universe where in 2008 no one is bailed out and bankers are either on the hook for the risks they took or actually are sent to prison. Taking it further back, what if the tech bubble of the 90s is allowed to collapse, interests aren't set at almost 0, and a housing bubble isn't blown by exploiting minorities. And last year airlines, and other corporations who didn't account for black sw…

I agree with your sentiment, injustice-outrage, but suspect that had things gone that way we'd be in Japan's real estate quagmire still, unemployment at 50%.

Why is Japans' real estate a "quagmire" and why would unemployment be 50% when Japan post 1990 averaged 3.5% (with a few short-lived peaks up to 5.5%)?

Re: Rich people do have trouble understanding what it's like to be poor

#172

Post by jayd16 »

adolph wrote: post #135
chasebank wrote: post #101

Earlier quoted context omitted.

Not in California. Prop 13 keeps property taxes at the value when you purchased your home. IMO this is a massive contributor to inflated property values, now leaking into other state economies.

What is your theorized mechanism for the freezing of property tax rates at the purchase price causing inflated property values? I could see it making an upward or downward trend worse. In an upward trend buying before increase would be tax advantaged. In a downward trend buying after anticipated decreases would have the advantage. All in all, more people would be advantaged by just staying in place. Maybe that reduce…

Its way more simple than you think. Lower taxes just lower the yearly cost of a house. That means you can get a bigger loan instead.

Re: Rich people do have trouble understanding what it's like to be poor

#173

Post by baq »

gruez wrote: post #85
throwaway3699 wrote: post #61

Earlier quoted context omitted.

Children are not a luxury product like a sports car or yacht. They are a basic function of human life.

All the kid free couples out there beg to differ.

Wrong. There are people who chose to not have kids and don’t deny that. They chose to give up this part of humanity on their own. Other people probably rationalize this differently because they can’t admit to themselves they’ve given up anything.

Re: Rich people do have trouble understanding what it's like to be poor

#174

Post by nitrogen »

moralestapia wrote: post #76
GuB-42 wrote: post #45

Earlier quoted context omitted.

The worst part is that your wealthy family member is right. It is well illustrated by a quote from Terry Pratchett > The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. > Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a se…

This is very naive and short-sighted, what percentage of your income go to boots? 1%? Your own example is talking about a ROI of 50USD in years, yeah sure ... that's wealth right there. People spend 90% of their wage on: rent, food and basic services. Can you be very smart and hack your way into halving your monthly rent? Can you be very smart and buy a really good potato that will last you for years? Can you be very…

Can you be very smart and hack your way into halving your monthly rent?

Yes, by splitting with someone else, or worst case moving.

Can you be very smart and buy a really good potato that will last you for years?

Yes again, by cutting and planting it, or at least part of it.

Can you be very smart and negotiate a better rate for the utilities you pay?

Sometimes, by moving to a lower cost area, or by shedding unnecessary usage and getting cheaper options. Get slow Internet instead of cable TV. Use an older phone on a cheap cell plan instead of the latest flagship on a subsidized plan. Take shorter, colder showers. Turn the lights off.

Re: Rich people do have trouble understanding what it's like to be poor

#175

Post by wongarsu »

moralestapia wrote: post #76
GuB-42 wrote: post #45

Earlier quoted context omitted.

The worst part is that your wealthy family member is right. It is well illustrated by a quote from Terry Pratchett > The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. > Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a se…

This is very naive and short-sighted, what percentage of your income go to boots? 1%? Your own example is talking about a ROI of 50USD in years, yeah sure ... that's wealth right there. People spend 90% of their wage on: rent, food and basic services. Can you be very smart and hack your way into halving your monthly rent? Can you be very smart and buy a really good potato that will last you for years? Can you be very…

The concept that money is required for investments that save money generalizes to nearly everything. Buying groceries in bulk is cheaper, but requires more money at once. Preventative maintenance on your car can be much cheaper than only repairing things once they break. If you own a home in a place that sees snow, insulation and oil/gas heating (as opposed to electrical heating) can save lots amounts of money, but are expensive to get.

If you don't have any money right now you are often forced to make decisions that cost you more money later, which sets up a vicious circle.

Re: Rich people do have trouble understanding what it's like to be poor

#176

Post by baq »

GuB-42 wrote: post #45
FriedrichN wrote: post #3

A more distant but very wealthy family member once said that people wouldn't be so poor if they just saved up money. That perfectly illustrated the difficulty rich people have understanding poor people to me. I was really young, but that really stuck with me.

The worst part is that your wealthy family member is right. It is well illustrated by a quote from Terry Pratchett > The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. > Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a se…

Or, in other words, it’s expensive to be poor.

Re: Rich people do have trouble understanding what it's like to be poor

#177

Post by mindslight »

e40 wrote: post #112
bradleyjg wrote: post #107

Earlier quoted context omitted.

People made vastly more money just sitting around in their houses in the past couple years than I made in my job as an "essential" worker over the past decade. This is not an accident. It’s a result of deliberate policy choices. The incumbent homeowners voted themselves massive returns. And they felt self righteous while they were doing it to boot.

What are you talking about?

The Federal Reserve's overt mission is to dump new money into the economy to create inflation. But since they only pump it into the overgrown financial sector, we get asset inflation rather than general price inflation.

Every time interest rates are lowered, land prices go up, because the monthly (financial) rent remains the same. Similarly with down payments (20% -> 5%). The next step will be lengthening mortgage terms past 30 years. Each of these steps is aimed at making it more affordable to buy a house, but economic feedback makes sure that is only temporary. Meanwhile as asset valuations go up, one's ability to ever pay off that mortgage goes down.

Re: Rich people do have trouble understanding what it's like to be poor

#178

Post by carlmr »

ta988 wrote: post #92
eplanit wrote: post #88

Earlier quoted context omitted.

I'm genuinely curious why you chose the USA to migrate to. Would you have been better off in the EU or Asia?

In EU, highly unlikely unless you go to Switzerland (which is not really EU but surrounded by EU).

Switzerland, funny enough, is quite capitalistic and very big on generational wealth you will never participate in as an immigrant.

Re: Rich people do have trouble understanding what it's like to be poor

#179

Post by kazinator »

baq wrote: post #176
GuB-42 wrote: post #45

Earlier quoted context omitted.

The worst part is that your wealthy family member is right. It is well illustrated by a quote from Terry Pratchett > The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. > Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a se…

Or, in other words, it’s expensive to be poor.

Right? For instance, you have this scale of value:

   $800 car
An $800 car isn't worth a damn, and a damn is worth a lot less than a wad of cash totaling $800.

Yet, being poor is expensive, so the poor person forks out $800 for a car that isn't worth a damn.

(Reference to "Being Poor": https://whatever.scalzi.com/2005/09/03/being-poor/)

Re: Rich people do have trouble understanding what it's like to be poor

#180

Post by globular-toast »

nanis wrote: post #36

Wealth is a stock measure, income is flow. You accumulate wealth out of what you can set aside out of the flow. Some of us immigrants do not come to this country with an existing stock of wealth either back home or here. We are also not in the favored group of immigrants. We have human capital which we are trying to convert to financial capital for the next generation. Then, when we sort of "make it" here, people who…

The effect of multi-generational wealth cannot be overstated really. I live in the UK and earn a very good salary (£60k), but I'm far from being "rich". I do feel rich, which is great, but I can walk ten minutes down the road and see multi-million pound houses that, barring some extremely fortuitous event, someone like me will never, ever be able to own.

It doesn't get my down, though. Those people with those houses rarely know what they have. It doesn't make them any happier. I'm happy knowing that everything I have has been earnt by me. I'm not sure I would be so happy if I didn't earn a very good salary, though.

Post reply on HN