Economic Termites: Monopolies not noticeable enough for most of us • Hacker News Board

Re: Economic Termites: Monopolies not noticeable enough for most of us

#421

Post by randomdata » Mon, Jun 10, 2024, 3:16 PM UTC

yareal wrote: post #419

randomdata wrote: post #415

Earlier quoted context omitted.

> A mortgage that is underwater means the value of the home is less than the loan balance. Indeed. Which means that when a home is not underwater, the owner has savings (or is breaking even, of course, but that is as equally unlikely and is for all intents and purposes considered to be the same as underwater). > If you make $5k a month and spend $5k on expenses, you can make all your mortgage payments (whether or not…

> Which means that when a home is not underwater, the owner has savings (or breaking even, of course, but that is as equally unlikely and is for all intents and purposes considered to be the same as underwater). What? It doesn't mean this at all. You can have savings and still be underwater. If you have a 3.5% for your mortgage, but the market crashes after you bought at the peak, you can be underwater because your h…

> You can have savings and still be underwater.

You wouldn't have savings in the house, but it is possible you have savings elsewhere, sure. However, if you are not underwater (or breaking even), you do have savings in the house, which is what the context speaks to specifically.

> Yes, money saved into a home is an asset that you are building over time. However it's a non liquid asset

There is nothing about savings that implies they must be liquid. If you are saving for a near-term purchase then savings for all practical purposes need be liquid, sure, but if you are young and saving for retirement liquidity is not of terrible importance. You have many decades in front of you to convert it into something else.

> Savings are typically held in checking accounts, savings accounts, CDs, and money market accounts.

Okay, but then we're again back to people not having savings because the returns have generally been poor, even basically non-existent in many cases, for a long, long time. Why would most people have savings in that kind of environment? The market has greatly incentivized surpluses to look elsewhere – especially towards real estate, where returns have been tremendous.

> It's important to decouple the concepts of net worth (or even just worth) from the concept of "savings"

That's for the earlier commenter to decide. It is not on us to prescribe their usage of a term. However, insofar as our discussion goes, it there is no such importance as we have already looked at both angles. No matter which direction you choose to go, the math doesn't add up with the presentation.

Re: Economic Termites: Monopolies not noticeable enough for most of us

#422

Post by yareal » Mon, Jun 10, 2024, 3:31 PM UTC

randomdata wrote: post #421

yareal wrote: post #419

Earlier quoted context omitted.

> Which means that when a home is not underwater, the owner has savings (or breaking even, of course, but that is as equally unlikely and is for all intents and purposes considered to be the same as underwater). What? It doesn't mean this at all. You can have savings and still be underwater. If you have a 3.5% for your mortgage, but the market crashes after you bought at the peak, you can be underwater because your h…

> You can have savings and still be underwater. You wouldn't have savings in the house, but it is possible you have savings elsewhere, sure. However, if you are not underwater (or breaking even), you do have savings in the house, which is what the context speaks to specifically. > Yes, money saved into a home is an asset that you are building over time. However it's a non liquid asset There is nothing about savings t…

> There is nothing about savings that implies they must be liquid.

Here are several examples that disagree. Yes, in a strict Keynesian economic sense it is saving but saving is different from savings, despite the similarity in the two words. (Yes, you are right, this is confusing.)

Examples defining "savings" in personal finance:

https://www.investopedia.com/terms/s/savings.asp

"Savings is essentially cash"

https://www.britannica.com/money/saving

"Saving may take the form of increases in bank deposits, purchases of securities, or increased cash holdings."

https://en.m.wikipedia.org/wiki/Saving

"In terms of personal finance, saving generally specifies low-risk preservation of money, as in a deposit account, versus investment, wherein risk is a lot higher."

Re: Economic Termites: Monopolies not noticeable enough for most of us

#423

Post by citizenpaul » Mon, Jun 10, 2024, 3:36 PM UTC

CPLX wrote: post #180

citizenpaul wrote: post #100

Earlier quoted context omitted.

This is basically a variation on tragedy of the commons. The solution is right there in front of everyone and "simply" requires everyone to do it coordinately. I've told this solution to numerous people, just log onto your bank website and click "dispute" and thats it you are done. Nope, they either don't believe me or are afraid of doing it because "banks". They continue to just allow crappy businesses to effectivel…

Disputing with banks isn't particularly reliable. These larger companies have a script now for responding for one, and the other thing that happens is they'll kill your account and permanently ban you. Neither of those accomplishes the goal of being able to purchase the product or service without being ripped off .

>Neither of those accomplishes the goal of being able to purchase the product or service without being ripped off.

I'd argue that its impossible to totally do that since humanity has never figured out how to remove scammers from the population. It is the way to fight back against it so I think that is really splitting hairs on complex sociology-econmic explanations.

Do you really want to continue do business with a company ripping you off?

Re: Economic Termites: Monopolies not noticeable enough for most of us

#424

Post by _mlbt » Mon, Jun 10, 2024, 3:37 PM UTC

sanex wrote: post #344

sologoub wrote: post #333

Earlier quoted context omitted.

> Four. Interestingly, the US cell phone industry would seem competitive - major players (Verizon, AT&T and T-Mobile) and a bunch of smaller and/or regional players including the incumbent telcos like xfinity and spectrum. Then you dig a little deeper and see that all that “competition” runs on the towers of one of the three and unlike with the reform of British Telecom (BT), there are no requirements for this infra…

5 years ago or so I had T-Mobile for $50/month unlimited everything. I switched off and just went back for $170 for a phone for my wife and I. To pretend to be comparable on a per line basis they gave me a phone number that I literally could not refuse. Before they bought Sprint we had the magic 4 but now it's 3 and a bunch of resellers.

Sprint was not going to survive. They were circling the drain and needed to be acquired to be rescued. I was a customer of theirs and they could literally only compete on price. T-mobile wasn’t in much better shape. Post merger the improvement in network quality and customer service has been night and day. Sprint owned tons of spectrum but was terrible at using it. T-mobile was spectrum starved and would not have the network they have today without purchasing Sprint.

Sprint literally bet on the wrong technology every single generation. They also had trouble getting many popular phones because they used such oddball network technology.

Re: Economic Termites: Monopolies not noticeable enough for most of us

#425

Post by randomdata » Mon, Jun 10, 2024, 3:40 PM UTC

yareal wrote: post #422

randomdata wrote: post #421

Earlier quoted context omitted.

> You can have savings and still be underwater. You wouldn't have savings in the house, but it is possible you have savings elsewhere, sure. However, if you are not underwater (or breaking even), you do have savings in the house, which is what the context speaks to specifically. > Yes, money saved into a home is an asset that you are building over time. However it's a non liquid asset There is nothing about savings t…

> There is nothing about savings that implies they must be liquid. Here are several examples that disagree. Yes, in a strict Keynesian economic sense it is saving but saving is different from savings , despite the similarity in the two words. (Yes, you are right, this is confusing.) Examples defining "savings" in personal finance: https://www.investopedia.com/terms/s/savings.asp "Savings is essentially cash" https://…

> Here are several examples that disagree.

Disagree with what? I fail to see the difference from definition two.

It does not match definition one, of course, but that had to exist in an effort to be fair to the original commenter. It is not like you are going to go in like a horribly confused idiot and randomly redefine tillage or something. If the OP is using savings in the sense of the positive net value of a home, rationally one will be accommodating to that.

But it doesn't really matter what definition you choose. The math doesn't add up to what was presented under any definition.

Re: Economic Termites: Monopolies not noticeable enough for most of us

#426

Post by yareal » Mon, Jun 10, 2024, 4:03 PM UTC

randomdata wrote: post #425

yareal wrote: post #422

Earlier quoted context omitted.

> There is nothing about savings that implies they must be liquid. Here are several examples that disagree. Yes, in a strict Keynesian economic sense it is saving but saving is different from savings , despite the similarity in the two words. (Yes, you are right, this is confusing.) Examples defining "savings" in personal finance: https://www.investopedia.com/terms/s/savings.asp "Savings is essentially cash" https://…

> Here are several examples that disagree. Disagree with what? I fail to see the difference from definition two. It does not match definition one, of course, but that had to exist in an effort to be fair to the original commenter. It is not like you are going to go in like a horribly confused idiot and randomly redefine tillage or something. If the OP is using savings in the sense of the positive net value of a home,…

The original poster is correct, the majority of Americans live paycheck to paycheck. With no savings (in the personal finance sense).

Example: https://www.forbes.com/advisor/banking/living-paycheck-to-pa...

What's challenging for you about these numbers? Your original response included mortgages in saving, which is atypical. If you exclude mortgages, which is typical, do the numbers make more sense?

> It is not like you are going to go in like a horribly confused idiot and randomly redefine tillage or something.

Try to remain on topic and avoid ad hominem, please.

Re: Economic Termites: Monopolies not noticeable enough for most of us

#427

Post by Spooky23 » Mon, Jun 10, 2024, 4:10 PM UTC

ebiester wrote: post #221

Spooky23 wrote: post #141

Earlier quoted context omitted.

Wages are tough in this segment because many households are dependent on external non-income benefits. Particularly Medicaid and particularly for children. So if your $16/hr job pops by 30%, the net impact on the household is much lower in many cases. For teen workers, it’s beer money. For single moms, it’s a net loss as costs for daycare and healthcare have increased 50%. All of this stuff is relative. I’m a tech ex…

This seems weird to me. What is your savings rate versus theirs? I say this because on the surface, the same feels true for me, but on closer inspection I spend money like water in ways they had tightly controlled. And yet, I have a higher savings rate than they did. (However, I don't have a pension.)

Probably similar, I’m an aggressive saver.

The biggest difference is housing and healthcare. My healthcare expense is equivalent to their mortgage. My dad family healthcare coverage was $0 until I was in high school. The total cost of my, excellent health insurance is about $35k, which is 90% of the salary of my first professional job in 1999!

Our policy with respect to healthcare is essentially a regressive tax on the working public. Rich people have a limited cost exposure, poor people get limited access to poor care, and everyone else gets increasingly expensive, lower quality care.

Re: Economic Termites: Monopolies not noticeable enough for most of us

#428

Post by randomdata » Mon, Jun 10, 2024, 4:12 PM UTC

yareal wrote: post #426

randomdata wrote: post #425

Earlier quoted context omitted.

> Here are several examples that disagree. Disagree with what? I fail to see the difference from definition two. It does not match definition one, of course, but that had to exist in an effort to be fair to the original commenter. It is not like you are going to go in like a horribly confused idiot and randomly redefine tillage or something. If the OP is using savings in the sense of the positive net value of a home,…

The original poster is correct, the majority of Americans live paycheck to paycheck. With no savings (in the personal finance sense). Example: https://www.forbes.com/advisor/banking/living-paycheck-to-pa... What's challenging for you about these numbers? Your original response included mortgages in saving, which is atypical. If you exclude mortgages, which is typical, do the numbers make more sense? > It is not like…

> The original poster is correct

Seemingly not, else we'd have seen the math already. Also,

1. Not having savings (in the personal finance sense) does not mean one is living paycheque to paycheque.

2. The article you link to defines living paycheck to paycheck as a scenario where the family income does not cover expenses. Principal repayment is not an expense. Outside of the 1-2% with interest-only mortgages, anyone who is paying a mortgage cannot be living paycheck to paycheck under the definition you have given. They must have surpluses over and above expenses in order to do so.

Again, the math does seem to work in that sense if you include children. But is there some reason we should be aware of newborns not making enough money to save?

> Try to remain on topic and avoid ad hominem, please.

1. It is on-topic. It explains why multiple definitions are present.

2. Ad homiem implies being directed at a person. The statement is not directed at a person.

Re: Economic Termites: Monopolies not noticeable enough for most of us

#429

Post by Gormo » Mon, Jun 10, 2024, 4:15 PM UTC

jmyeet wrote: post #276

Animats wrote: post #211

Four. That's the magic number. There have to be four competitors of significant size before prices go down. There are both EU and US studies substantiating this. It's been seen in cellular phone networks, ISPs, drugstores, and banks. Drop below the threshold of four, and the magic happens. Prices go up, margins go up, and consumers lose. Four should be the basis of antitrust policy. Less than four, and there are two…

Speaking generally, not to you specifically, it seems like a ton of people see the problems created by capitalism and decide the solution is even more capitalism . I don't think there's a magical number of competitors that fixes things. We see an interesting phenomenon in commercial landlords where we have a ton of players but they all use the same software [1], which creates an effective monopoly even though it's no…

> Speaking generally, not to you specifically, it seems like a ton of people see the problems created by capitalism and decide the solution is even more capitalism.

"Capitalism" is a descriptive model, not an entity with causal agency. Everything boils down to the intentions and actions of the human beings involved, and those do not change by paying lip service to a different body of abstract dogma.

To the extent that "capitalism" accurately describes the structural incentives and constraints inherent in the reality that these problems are manifesting in, then there is nothing other than "even more capitalism" on the table as a solution.

Problems can only be solved from within the world that generates them -- there is no "outside", as devotees of various dogmas often mistakenly think.

Re: Economic Termites: Monopolies not noticeable enough for most of us

#430

Post by Gormo » Mon, Jun 10, 2024, 4:20 PM UTC

lovich wrote: post #377

WalterBright wrote: post #347

Earlier quoted context omitted.

Which proves my point. It was not cost that prevents multiple sets of wires being laid. It's regulation, and frankly rather poor management by the government. For example, a road nearby was widened for bike lanes. While they were at it, a trench was dug before the repaving to enlarge the water/sewer pipes. I emailed the people in charge that they should consider burying the power lines, too. The power lines ran on te…

>Which proves my point. It was not cost that prevents multiple sets of wires being laid. It's regulation, and frankly rather poor management by the government. Do you look at the picture I linked, and think this is a preferable end state over some extra regulatory cost? That you would rather have those sets of cables all over the place and think the government is preventing this better state? If you do, that's an opi…

> Do you look at the picture I linked, and think this is a preferable end state over some extra regulatory cost?

Alternatively, we can dispense with the false dichotomy (along with the presumption that the technical constraints of 19th-century telegraph lines are applicable to modern telecom) and identify ways to incentivize competitive markets without dealing with externaliies by imposing regulatory barriers that ultimately generate oligopolies.

OTOH, the modern version of your picture would probably consist of dozens of fiber lines all running through the same network of underground conduit, so the most direct answer to your question is "yes, absolutely".