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The Great Resignation? More Like the Great Renegotiation

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Re: The Great Resignation? More Like the Great Renegotiation

#391

Post by c1sc0 »

Flankk wrote: post #343
makecheck wrote: post #329

At least two things happened here: - The pandemic gave most people an unusually-long period of time at home to help them realize all the things they could have been doing (e.g. spending more time with family, not being stuck in a commute), if only their work had not been sucking up all their time and energy. - Income vs. expenses changed to the point where people couldn’t hope to pay off their debts even if they work…

There has been a massive psychological shift too. Everyone suddenly realized life is short and you need to take action before it is too late. Starting a business has risk and there is fear associated. All that goes out the window when you realize you have nothing to lose.

Realising you have nothing to lose is liberating & a strong motivator to discover and spend time on the things that matter in your life. Between taxes, healthcare and inflation there’s nothing left at the end of the ride anyway. So why would you conform to the norms? Why play the game? Especially when it’s becoming abundantly clear that our society won’t be able to tackle the much larger problems looming ahead when we can’t even handle a minor inconvenience like a pandemic. So yeah, sure, I don’t blame anyone for “checking out” of the rat race.

Re: The Great Resignation? More Like the Great Renegotiation

#392

Post by gamechaynes »

jonnycomputer wrote: post #346
KerrAvon wrote: post #298

Earlier quoted context omitted.

What do you intend to connote by saying someone is "rich," though? What does it signify? If the definition of "rich" is "independently wealthy," that family certainly doesn't meet it. They still have to work for a living. If it means you never have to worry about where the next meal is coming from or losing the roof over your head, sure, a lot of people are "rich." And maybe this is better than 90% of humanity does,…

Their modes of thought, their concerns and worries, their expectations, their assumptions of what is possible, their habits, their identities, all different.

She said: 'I am loosing every time!'

He answered: 'No, you are often winning, but when you lose you lose way too high.'

(-;

Re: The Great Resignation? More Like the Great Renegotiation

#393

Post by coryfklein »

sleepingadmin wrote: post #262

Why is the central bank inflation target typically 2%? Well if you target 0% and any actual result below 0% happens, that's deflation which is a disaster for economies. If inflation is say 10%. Maximum employment is near certainly impossible. Debt will be expensive and the economy crawls to a halt. Who wants to pay 10% interest on their student debt? So where in between do you have a good price stability? It tends to…

Since you seem quite interested in learning economic fundamentals, I highly recommend you check out the Moody's Talks Inside Economics podcast [0].

One topic they have discussed with fair regularity lately is the current inflation rate. They point out that you can tease out what factors contribute to that 7% inflation number, and once you subtract out 2-3 specific components, components that – with some inductive reasoning – we have good reason to believe are transitory in nature, the inflation number that applies to the broad majority of fundamentals is actually closer to the fed's 2% target.

I'm not an expert in this area and I don't grok the economics on a deep enough level to be able to reproduce their argument in situ here, but their case that the fed's strategy of holding steady is in fact the most responsible thing to do to achieve that 2% target.

[0] https://about.moodys.io/podcast-series/moodys-talks-inside-e...

Re: The Great Resignation? More Like the Great Renegotiation

#394

Post by beambot »

cwkoss wrote: post #353
beambot wrote: post #318

Earlier quoted context omitted.

Wealth != income. What you're advocating isn't changing a loophole, it's developing an entirely new tax (wealth tax) to supplant the old (income tax). It helps to be explicit.

The loophole is that you can get $1M deposited into your bank account, but because it's technically a loan it isn't considered income. This doesn't require a wealth tax, (and getting ex. a home loan shouldn't be taxed as income), but being able to utilize wealth to get a pile of cash that is not taxed is effectively untaxed income IMO. A wealth tax could address this, but perhaps there are other legislative options,…

This type of loan is really just a form of margin -- the same thing you can get at most stock brokerages (e.g. Schwab, TD Ameritrade, Interactive Brokers, etc). It seems almost impossible to distinguish the purpose of the loans -- e.g. I know people who use these loans to fund primary residence purchases because they lack income for FHA mortgages.

In fact, unless you have a cash-only account, you likely use margin every time you buy & sell a stock. Technically, stock transactions don't settle for 2-3 days. When your brokerage fronts you the shares to immediately buy, sell, or transfer funds, it's all margin under the hood. It gets even more complex once you get into options, swaps, and other esoteric financial instruments.

TLDR: It's simple in principle, but very complex in practice. Further complicating IRS rules is unlikely to win the whack-a-mole competition -- especially when IRS auditors under-target the ultra wealthy to begin with.

Re: The Great Resignation? More Like the Great Renegotiation

#395

Post by buscoquadnary »

sleepingadmin wrote: post #262

Why is the central bank inflation target typically 2%? Well if you target 0% and any actual result below 0% happens, that's deflation which is a disaster for economies. If inflation is say 10%. Maximum employment is near certainly impossible. Debt will be expensive and the economy crawls to a halt. Who wants to pay 10% interest on their student debt? So where in between do you have a good price stability? It tends to…

I keep hearing that people in debt win when inflation goes up but the problem is you only win if you have assets that already appreciate in value or access to large amounts of capital to purchase assets that are inflation resistant. Simple example Tim is a manager at Lowe's Tim makes $66,000, each year. Tim spends most of that money on the necessities of life, a car payment a house payment if he is lucky, a rent if he is not, Tim spends some on groceries and basic living things to support his family. Inflation goes up 10%, Tim's boss fights for Tim and works hard and Tim gets a 7% raise which is unheard of because usually raises are capped at 5% so Tim is very happy. In the meantime his purchasing power has actually decreased.

Contrast this with Larry, Larry is very rich, Larry owns stocks in multiple companies, Larry also owns many assets and has enough capital to move it into other places to protect it against inflation. Inflation goes up 10% Larry's stocks, real estate and other ventures go up 12% because people are trying to find places to park their cash to avoid losing it to inflation.

In the end Larry ends up with substantially more money because he could take advantage of the inflation, and also because of his wealth had access to credit to take advantage of the low interest rates, meanwhile Tim has blown out his savings because his car's transmission gave out and he didn't have the money to buy a new one, and now is riding at the edge of his income because everything went up in price but Tim didn't want to end up enslaved to credit card debt just to continue living and the banks won't give you loans for "hey I need to buy groceries", so he got screwed by it all in the meantime the money and purchasing power Tim lost went to Larry.

So someone help me understand where my understanding is wrong, because yes I agree in a world of airless friction-less vacuums inhabited by spherical cows the inflation is good for debtors but in the world of the real it doesn't seem that way.

Re: The Great Resignation? More Like the Great Renegotiation

#396

Post by oversocialized »

sleepingadmin wrote: post #262

Why is the central bank inflation target typically 2%? Well if you target 0% and any actual result below 0% happens, that's deflation which is a disaster for economies. If inflation is say 10%. Maximum employment is near certainly impossible. Debt will be expensive and the economy crawls to a halt. Who wants to pay 10% interest on their student debt? So where in between do you have a good price stability? It tends to…

the central bank was sold to the public to prevent recessions and bank runs. they haven't done the former, and the latter is very easy to do now that the reserve rate is at 0%. however countries without central banks post 2000 (afghanistan, iraq, libya, north korea, etc) have not fared well against the petrodollar cartel's war machine.

Re: The Great Resignation? More Like the Great Renegotiation

#397

Post by AlexCoventry »

sleepingadmin wrote: post #262

Why is the central bank inflation target typically 2%? Well if you target 0% and any actual result below 0% happens, that's deflation which is a disaster for economies. If inflation is say 10%. Maximum employment is near certainly impossible. Debt will be expensive and the economy crawls to a halt. Who wants to pay 10% interest on their student debt? So where in between do you have a good price stability? It tends to…

> The USA is at 7% inflation. This means the central bank is not doing their job.

Is it absolutely clear at this point that monetary policy is to blame? It seems to me that supply-chain issues could still be a major factor.

Re: The Great Resignation? More Like the Great Renegotiation

#398

Post by smeeth »

nickff wrote: post #370
sleepingadmin wrote: post #262

Why is the central bank inflation target typically 2%? Well if you target 0% and any actual result below 0% happens, that's deflation which is a disaster for economies. If inflation is say 10%. Maximum employment is near certainly impossible. Debt will be expensive and the economy crawls to a halt. Who wants to pay 10% interest on their student debt? So where in between do you have a good price stability? It tends to…

> "Well if you target 0% and any actual result below 0% happens, that's deflation which is a disaster for economies." It's not actually clear that deflation causes economic problems for the commonly cited reason (decrease in consumer spending). I think you're right about most of what you say concerning inflation. https://www.investopedia.com/articles/markets/111715/can-def...

The economic profession developed some serious deflation PTSD from the great depression. I always heard deflation was bad. Nobody ever seemed to have a great case for why based on good historical data.

This is a chart of the US annual inflation rate. Note that consistent inflation only occurs after ~1930. https://commons.wikimedia.org/wiki/File:US_Historical_Inflat...

This is a log-scale chart of US GDP per capita adjusted for inflation and international price differences. https://ourworldindata.org/grapher/gdp-per-capita-maddison-2...

Do you see a discernible change in growth trend since the shift to consistent positive inflation? I don't.

To be clear, I'm not saying this is even close to conclusive evidence, I just feel like its a compelling enough side-by-side to warrant further questioning.

Re: The Great Resignation? More Like the Great Renegotiation

#399

Post by zeusk »

Stupulous wrote: post #351
zeusk wrote: post #324

Earlier quoted context omitted.

No that’s not how it works. Infact, you can get a margin loan at 0.75% interest from ibkr if you hold more than 50k usd of stock for half of its value. Of course, if that value drops you’ll get margin called for more collateral

Half of its value is less than after-tax value, which is at least the initial investment + 63% of the gains.

Maybe I didn’t phrase it right for you,

Unaccredited investors (us, commoners) have access to margin loans for up to 50% value of account.

Accredited investors have access to portfolio margin which can be up to 90% of mark to market value.

That’s nothing to say of any custom financial instruments that banks might come up with to save bezos any taxes. Think swaps.

Re: The Great Resignation? More Like the Great Renegotiation

#400

Post by manuelabeledo »

chasd00 wrote: post #375
manuelabeledo wrote: post #37

I think it's a bit of both. It's not only about the money. Many people are realising just now that they don't get paid enough to take all the crap they get from work. Anecdotally, I know a handful of engineers who quit their jobs because of this. They were making good money, just not good enough for the number of sleepless nights and stressful days they were going through.

what are they doing now though? Eventually, the student loan repayment delay expires, the covid unemployment goes away, any eviction moratoriums expire, and on top of it everything is more expensive than it was. I hope people who are leaving their jobs for less stressful or more accommodating jobs are increasing their income levels as well. There's going to be a big bill due when all the covid relief measures and sav…

> what are they doing now though?

They are working in the same field, just different companies.

> I hope people who are leaving their jobs for less stressful or more accommodating jobs are increasing their income levels as well.

Again, sometimes wages are not worth the loss in health.

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