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Price shocks in formative years scar consumption for life

knowledge.wharton.upenn.edu

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Re: Price shocks in formative years scar consumption for life

#311

Post by Xeoncross »

jackblemming wrote: post #298
beezle wrote: post #297

I was a kid during both oil shocks of the 1970s. That has absolutely nothing to do with my driving. What does, and not just for driving, is the family taught cultural value of 'don't be wasteful'. So unlike so many people today, I don't make 12 trips a day to stores/friends/whatever when I can just make one or two if I actually think 5 minutes ahead. That applies whether gas is $1 or $5 per gallon. I also try to make…

How many years earlier does that let you retire?

Not years, hours.

While I'm on my 4th trip out for the day I'll bet he's already back home watching TV.

Joking aside, I've definitely see the cost/hr add up by purchasing new things that still have bugs to work out. The price might be $500, but I'll spend another $700 of time working on issues. I'm fine being a few months late to the party so I can conserve time for more important things.

In the words of the characterized OP: "If it ain't broke, don't fix it"

Re: Price shocks in formative years scar consumption for life

#312

Post by aerostable_slug »

lotsofpulp wrote: post #169
kayodelycaon wrote: post #167

Earlier quoted context omitted.

Dealing with cash is complicated actually. You need to protect it from theft. You need to count it daily. You need a bank to deposit it. You need to have change because people don't bring exact amounts. Having change requires a bank or some other facility to exchange currency with. Cards require a machine, some kind of network connectivity, and an account. It's actually a lot easier to deal with as a small business.…

Yes, but I was talking about a scenario where there is no network connectivity and hence no ability to take card payments. In the case of getting paid something versus getting paid nothing, I am guessing most merchants will opt to put in the work to accept cash rather than shut down.

Note that some retailers can and do store and forward transactions, for example with gas stations using satellite connectivity for payment processing. The amount one stores depends upon one's fraud tolerance.

There are attacks where bad guys will disable a gas station's dish (by covering it with foil among other methods) and then rack up a bunch of gasoline sales with a stolen card. They've got generally got a limited window so they have to hit a bunch of local stations quickly, but meth users aren't known for high dollar scores.

Re: Price shocks in formative years scar consumption for life

#313

Post by mabbo »

yunwal wrote: post #245
Gamemaster1379 wrote: post #229

Earlier quoted context omitted.

> It's not logical or financially wise I'm taken aback by this statement. I am in an incredibly similar situation to your wife in terms of growing up and being successful today, and I do this. Granted, I think I'm at 3.5 months, but the point stands. Sure, the money isn't generating more wealth, but that amount is finite. It's a cushion that should effectively indefinitely and every dollar beyond is vigorously invest…

Stocks are liquid enough that you can sell enough to pay your credit card off before getting hit with interest. There's no reason to have 6 months worth of expenses in cash just sitting around unless you strongly suspect a crash.

That sounds like a lot of work, with added risks.

With our system, our bills get paid with the money we have, and then when we make more money, it just goes back to the buffer account. Overflow goes into investing.

Re: Price shocks in formative years scar consumption for life

#314

Post by sangnoir »

jlawson wrote: post #251
sangnoir wrote: post #215

Earlier quoted context omitted.

It goes way beyond frugality - it is usually accompanied by a touch of hoarding (bought a new phone? Let's keep the old one even if it has a cracked screen, just in case ... .) A term I've seen bandied about for the collective symptoms is having a Scarcity mindset and it's based on insecurity/fear of unexpectedly running out of money (which was a frequent event in childhood) John Scalzi's classic "Being Poor" blog po…

>(bought a new phone? Let's keep the old one even if it has a cracked screen, just in case... .) Never been poor; me and my whole family have always done this. I just forced them to get rid of their standalone DVD player. They have remote controls for devices going back to the 90's. The cellphone example is even better; you'd be a fool to immediately dump your old phone. It's small and easy to store, and if your new…

A -> B =/= B -> A

You don't have to be/(have been) poor to be a hoarder. On the old cellphone, my emphasis was a drawer full of backup-to-a-backup-to-a-backup devices that are now 10 years old and is running Android 2 and are potentially a fire hazard while charging and are not fit for use - they are emotional support devices. Keeping one generation of backup device is rational, 3+ means there's something to unpack.

I'm curious about how your family tradition came to be: a high number of people who experienced the great depressions in their formative years are/were compulsive hoarders in latter years.

Being poor is what keeps poor people poor; costs of necessities go down the richer you get; being poor is expensive

Re: Price shocks in formative years scar consumption for life

#315

Post by moffkalast »

Melatonic wrote: post #272
collinvandyck76 wrote: post #235

Earlier quoted context omitted.

with the market being as it is, actually very wise to have a lot of cash on hand :) we also operate this way. i could become unemployed today and we buffer enough so that it's not an emergency at all.

I prefer a layered approach - some investments take longer than others to cash out. And some are in between but still provide some return. A ton of cash on hand is probably a bad idea

https://www.reddit.com/r/dataisbeautiful/comments/tou7v2/oc_...

Even Warren Buffet always keeps at least something like a fifth of his investments in cash. Otherwise how the hell are you going to buy low?

Re: Price shocks in formative years scar consumption for life

#316

Post by nomel »

wolverine876 wrote: post #283
almost_usual wrote: post #79

Earlier quoted context omitted.

> Being poor in general, during your childhood, scars you for life. You can learn to cope with the anxiety better if you talk to a therapist but it will never fully go away.

Who can afford a therapist?

Especially if you have anxiety around spending money.

Re: Price shocks in formative years scar consumption for life

#317

Post by cableshaft »

aerostable_slug wrote: post #306
CalRobert wrote: post #101

Earlier quoted context omitted.

We were surprised to discover after her death (in the late 80's) that my great grandmother kept $1,000 in a pouch in her bra. I can understand not trusting the banks and wanting to always have some sort of cash on your person.

My grandfather carried $3k in his wallet every day for the same reason.

I'd worry more about being mugged with that much in my wallet than an emergency happening that required needing that much cash on-my-person.

Re: Price shocks in formative years scar consumption for life

#318

Post by ninjanomnom »

bornfreddy wrote: post #299
jackblemming wrote: post #298

Earlier quoted context omitted.

How many years earlier does that let you retire?

Is that the only goal people are supposed to have in life?

Many people nowadays see retirement, especially early retirement, as a means towards whatever goal they have in life. You can focus on whatever you like without worrying about your financial stability.

Re: Price shocks in formative years scar consumption for life

#319

Post by astrange »

ravenstine wrote: post #275
Nick87633 wrote: post #170

Earlier quoted context omitted.

They still had installment plans for buying appliances and repossessions. I'm pretty sure usurious loans have existed since money was invented.

Of course. Loans have existed since the beginning of money. That doesn't mean average people were using credit and loans to buy everything from Lambos to Cheetos to pornos like they can today. Not until very recently. Credit wasn't really something that was available to most people until around the 70s when it began to be digitized successfully. The psychology of debt today compared to that of a few generations ago i…

If you know the general store owner or your pub landlord and you ask them to put something on your tab, that's credit. Exact payment on the spot is what develops when you're trading with strangers.

Re: Price shocks in formative years scar consumption for life

#320

Post by astrange »

mellavora wrote: post #72
usrn wrote: post #45

Earlier quoted context omitted.

Honestly fuck the medical system, young people don't care. Housing is what's really getting us. Some days I feel like driving up to McLean and burning banks down. EDIT: I'm out of comment quota but dymk I'm so tired of hearing that, here's my reply: Oh fuck off. I make six figures and work remotely. My family lives in a rural part of a small state and I can't afford a house within driving distance of them. EDIT2: Ass…

Hey, there is a chance that inflation pops the housing bubble. Why risks crimes yourself when you can let the Fed burn the whole thing down for you?

There isn't a housing bubble, they are fundamentally that expensive because there's a shortage of them.
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