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Money and wealth

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Re: Money and wealth

#131

Post by probablyfiction »

onebaddude wrote: post #30
probablyfiction wrote: post #4

Robert Kiyosaki's claims are pretty hard to verify. Rich Dad, Poor Dad is not a good source for financial information. Edit: Forbes link ( http://www.forbes.com/sites/helaineolen/2012/10/10/rich-dad-... )

Kiyosaki teamed up with Donald Trump to write a more recent book, titled, "We Want You To Be Rich!". That speaks volumes about their angle and market. That said, the core philosophy of Rich Dad, Poor Dad is a good lesson: make your money make money by buying "assets" and avoiding "liabilities".

Also, buy low and sell high.

Re: Money and wealth

#132

Post by sharemywin »

dragontamer wrote: post #105
01Michael10 wrote: post #86

Earlier quoted context omitted.

I have always found it odd people who are so against wealth (or income) redistribution always talk about the taking of money from the rich to the poor. Where have you been the last 30 years (in the US)? The only redistribution has been from the working poor and middle class to the rich. Really against wealth redistribution? Talk about a bottom up approach to tweaking our economy instead of trickle down...

Actually... the redistribution is closer from "the old rich" to "the new rich". 50 years ago, when you said "the rich", it would mean descendants of Carnegie, Hersey, or other big name company builders who created monopolies in the late 1800s and early 1900s. The majority of "the rich" were lawyers and doctors with Ivy League degrees and long pedigrees. Today's rich are Bill Gates, Mark Zuckerberg, Warren Buffet, Gab…

according to another article I read the new rich 10M+ wealth are mostly money mangers taking a cut of the money moving around. and collecitng it thtough capital gains.

Re: Money and wealth

#133

Post by ronaldx »

dragontamer wrote: post #126
ronaldx wrote: post #102

Earlier quoted context omitted.

> I strongly disagree with his assertions that saving up for retirement is ill-advised and that traditional investments (stocks, etc.) are too volatile and risky to be useful. With my retirement age ~40 years away, it's not clear to me that locking my money into traditional investments is a good idea: existing historical records are not statistically convincing (to me) over such a term. A single stock market crash or…

The stock market has historically never dropped in value over a 15 year period. If you continually invest through a crash, you will make insane amounts of money. Lets say you started investing in 2006 (before the crash), specifically in SPY. Lets say you put $10,000 / year into SPY. You'd have spent $80,000 over those years, and today, your SPY holdings would be worth $118,176.92. You'd make a 47% profit because you…

> The stock market has historically never dropped in value over a 15 year period.

Feel free to clarify this, because I don't agree.

The records of the FT30 index only go back to 1935[0] - which is not nearly long enough to make reliable predictions about the next 40 years - but still, it dropped in value in the following 15-year periods (before taking into account time value of money):

  1936-1951
  1959-1974
  1994-2009
  1995-2010 (records end)
The 20-year periods 1954-1974 and 1989-2009 also.

Still not convinced? The fact that this is a surviving index makes it biased - indices which show a loss of value are less likely to be retained.

[0]http://www.ft.com/ft30

Re: Money and wealth

#134

Post by jongraehl »

JonnieCache wrote: post #61
jerf wrote: post #52

Earlier quoted context omitted.

Strawman; I was explicitly talking about wealth redistribution qua wealth redistribution. Politics ruins another mind.

It's called a strawman when you shoot down an idea that nobody else gives a shit about, however explicitly you do it and however many latin tags and semicolons you use. Groups who capitalise phrases like The People traditionally want to redistribute control over the means of production, ie. they would have community ownership over microsoft itself. There aren't any socialist revolutionaries who want to break open the…

Wrong; that's only part of it. Strawmanning is when you impute a weak argument to other-side proponents that isn't actually representative, so that you can knock it down, leaving the impression that there remains nothing against your side of the issue.

Re: Money and wealth

#135

Post by 01Michael10 »

dragontamer wrote: post #105
01Michael10 wrote: post #86

Earlier quoted context omitted.

I have always found it odd people who are so against wealth (or income) redistribution always talk about the taking of money from the rich to the poor. Where have you been the last 30 years (in the US)? The only redistribution has been from the working poor and middle class to the rich. Really against wealth redistribution? Talk about a bottom up approach to tweaking our economy instead of trickle down...

Actually... the redistribution is closer from "the old rich" to "the new rich". 50 years ago, when you said "the rich", it would mean descendants of Carnegie, Hersey, or other big name company builders who created monopolies in the late 1800s and early 1900s. The majority of "the rich" were lawyers and doctors with Ivy League degrees and long pedigrees. Today's rich are Bill Gates, Mark Zuckerberg, Warren Buffet, Gab…

I don't understand the point of your comment? We should feel bad about people who were rich only for a "little" while? I feel bad about people who lose their jobs that were out sourced and then need to take a lower paying job to survive.

Sorry, still plenty of rich people who earn their money the old fashion way... They inherited it.

I wasn't even talking about individuals but a system that rewards people who already have wealth over the working poor and middle class. Worse, now with the "Citizens United" ruling we are creating a plutocracy that our Founding Fathers feared more then anything.

Re: Money and wealth

#136

Post by RestlessMind »

What are the net income generating assets? I thought stock market is the best of them all, particularly if one has a longer time horizon (>20yrs).

But the article says stocks are a bad idea. In that case, where should I be putting my money?

Re: Money and wealth

#137

Post by yummyfajitas »

cconroy wrote: post #125
lmm wrote: post #90

Earlier quoted context omitted.

Liquidity is an irrelevant side issue. Gates would have exactly the same problem if he tried to sell all that microsoft stock to buy turnips; he could destroy billions of dollars of wealth just as easily as the people you so despise. (In fact, if you turn it around, Gates doesn't really have 100 billion dollars. He has something that looks like it's worth that much, but only for as long as he doesn't try and use it.…

Agree. It seems noteworthy to point out in the GP in how he expresses class warfare . When this is invoked (here and elsewhere) it's always the poor who are committing "class warfare" against the rich. When in reality, with evidence abound throughout history it is the rich who actually commit class warfare on a continuous basis against everyone else. Even HN is not immune to this propaganda.

Historically this has been true, but nowadays it's not (at least in the US). To quote Paul Krugman on the topic, from way back when he still did economics:

"...growth in inequality is not a simple picture. Old-line leftists, if there are any left, would like to make it a single story--the rich becoming richer by exploiting the poor. But that's just not a reasonable picture of America in the 1980s. For one thing, most of our very poor don't work, which makes it hard to exploit them. For another, the poor had so little to start with that the dollar value of the gains of the rich dwarfs that of the losses of the poor. (In constant dollars, the increase in per family income among the top tenth of the population in the 1980s was about a dozen times as large as the decline among the bottom tenth.)"

The Age of Diminished Expectations, 1990, p. 24.

http://lhrgateway.nu.edu.pk/articles/Krugman_Age_of_Diminish...

None of the facts he stated have changed. The poor have not started working. And citing the growth in inequality since the 1990s only makes his point about dollar gains/losses more stark.

Re: Money and wealth

#138

Post by jonnathanson »

pbhjpbhj wrote: post #68
jonnathanson wrote: post #26

Earlier quoted context omitted.

I think a lot of people misunderstand what a pain in the ass buying and renting property can be. Unless one is wealthy enough to own multiple properties and have a full-time management company doing all of his work for him, he's going to be taking a fairly hands-on role. Most tennants are flaky. Our perceptions of such might be colored by the fact that -- I assume -- a lot of us here are white-collar professionals ma…

Based on your post it appears you're not profiting at all from your assets - presumably then you're currently selling up? Is this more "first world problems" and in fact you're making a reasonable return given your investment of time and money? I've several friends who're small time landlords - ie own a second residence they let out - they all make a tidy profit and none of them appear to have been exposed any more t…

"Based on your post it appears you're not profiting at all from your assets"

Not true. I'm making decent cash flow and a net profit.

"Is this more "first world problems" and in fact you're making a reasonable return given your investment of time and money?"

Of course it's a "first-world problem." I think you're misinterpreting me as somehow complaining about how bad I have it. That's not the case. I'm in a very fortunate position that I can even be doing this.

The point of my post was specifically to respond to the previous poster's comment about how investing in real estate seems like "funemployment." It's not fun, and it's hard work. It can be lucrative, but it's not a set-it-and-forget-it type of job. And it's not easily scalable unless one is prepared to do it full time (in which case, if they're good at it, it can be quite lucrative).

Re: Money and wealth

#139

Post by Dewie »

ricardobeat wrote: post #127
Dewie wrote: post #49

Earlier quoted context omitted.

A similar story was illustrated in Carl Barks' Scrooge McDuck story. A tornado lead to Scrooge losing all his money to everyone. This lead to everyone leaving their job and going on vacation. Soon, goods became scarce, so they had to turn to Scrooge who were selling produce from his farm at inflation-level prices. Soon everything returned to its usual equilibrium. (Scrooge owns a lot of businesses, anyway, so that wo…

I don't think that story means what you think it does. It's a tale of wealth and power . Money is just one part of the equation. It also perpetuates the right-wing myth/prejudice that poor people are lazy and can't handle larger amounts of money than they "need", which has been proven wrong repeatedly.

> I don't think that story means what you think it does. It's a tale of wealth and power. Money is just one part of the equation.

You automatically take me for a fool when all I did was present the story, not my interpretation of it. Fiction can be interpreted in many different ways, independent of the author. I think the story is saying that there is more to wealth than just money; that you can't just throw money at things or people and magically get the equivalent amount of wealth.

How is it about power? Scrooge recouped his money by just working on a farm and selling the produce. If it was about power and/or assets, he would have recouped it through his businesses (of which he owns a considerable amount of), as I hinted at in my post.

> It also perpetuates the right-wing myth/prejudice that poor people are lazy and can't handle larger amounts of money than they "need", which has been proven wrong repeatedly.

Maybe it does. I think it has more to do with the fact that you can't just inject money (or redistribute it) into an economic system that is more-or-less closed (there is a more or less fixed amount of labour in the system and so on) and get the desired effect. Without some restructuring of the system, you're probably going to get a lot of undesirable effects like inflation, which might just return you to where you were (or leave you in a worse state). Scrooge had been hoarding all of that money for decades... to put it back into the system has the same effect as to print money.

If the story was motivated by some right-wing philosophies, I think it was more motivated by the simplistic model of human motivation for wealth and and incentives (everyone immediately goes on vacation when they have met a windfall). Scrooge is more motivated by money itself than wealth so he was able to buckle down and get his money back.

But I'm not an economist so my opinions might be wrong. Nonetheless I don't consider myself a "right-wing", which is a rather vague concept in this discussion since you're from Brazil and I'm from Norway.

Re: Money and wealth

#140

Post by m3mnoch »

_delirium wrote: post #82
jerf wrote: post #58

Earlier quoted context omitted.

That's only the example, to make it easy to grasp. The same thing happens at scale in real life, too, it just isn't so obvious because it looks like merely the background state of the world, rather than something that is actively occurring. Again, people are going to have a hard time reading this as a morally neutral statement, but the fact that taxes exist depress the value of assets on the market. It's already pric…

> and yes, taxes can fund things of value that can bring wealth to the society at large, etc etc, but all of that adds to the truth, it does not somehow "undo" this fact. Isn't the net effect what people are interested in? If you impose taxes and then do nothing useful with the money, sure, that's an easy negative. And if you tax only unproductive private-sector assets and use them for public goods, that's an easy po…

indeed.

as a guy who's modeled and built economies for mmos, i can confidently say the more movement and activity in your economy, the healthier your economy is. consistent, steady growth and activity, rather than spikes (unbridled liquidity events) and valleys (accumulation stagnation), is the most desirable mode.

for a real world microcosm view, just look at the last six months of bitcoin activity. who on earth would consider that healthy?

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