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How People Get Rich Now

paulgraham.com

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Re: How People Get Rich Now

#431

Post by danielscrubs »

ptr wrote: post #207
Certhas wrote: post #57

It's an interesting read, and not entirely new information, but I find this leap pretty unconvincing: > So it's not 2020 that's the anomaly here, but 1982. The real question is why so few people had gotten rich from starting companies in 1982. It seems more likely to me that industrialization and mass-production in the late 19th century, and information technology in the late 20th century were inflection points at wh…

Sweden's wealth Gini coefficient is the 4th highest in the world though. US is at 5. Asset distribution is very unequal in Sweden. https://en.wikipedia.org/wiki/List_of_countries_by_wealth_eq...

If you have assets they are barely taxed, if you have the audacity to go to work you are taxed into oblivion.

The politicians tried to tax assets but to no ones surprise, there was a mass exodus of rich people so they stopped.

Re: How People Get Rich Now

#432

Post by true_religion »

troygoode wrote: post #322
true_religion wrote: post #272

Earlier quoted context omitted.

I understand the comparison, but the FSF can exist without RMS. PG on the other hand solely supports HN, I doubt he would continue to pay for a site that vilified him.

This is incorrect. HN is run by Y Combinator; yes, PG started YC, but he retired from YC 7 years ago.

Oh, I had thought he stepped down from the day to day role but still had significant investment and control.

There are many firms where the owner is never present, but all employees know not to cross them. (E.g. Washington Post & Jeff Bezos).

Re: How People Get Rich Now

#433

Post by missedthecue »

greatgib wrote: post #411

Strangely, an explanation for the increased number of wealths coming from new, tech companies and investments that is ignored in his post is the disturbing fact it was taken from the average employee cut of the profits. See this: https://www.theguardian.com/business/2018/aug/16/ceo-versus-... I quote: "The 2017 CEO-to-worker compensation ratio of 312-to-1 was far greater than the 20-to-1 ratio in 1965, and more than…

I hate this comparison. Stock based compensation didn't exist in 1965. It's an oranges to apples comparison.

CEO salaries today are still about 20-1, depending on the business. For instance:

- Doug McMillon of Walmart makes $1.2 million in salary.

- James Quincy of Coca-Cola makes $1.5 million in salary.

- JPMorgan's CEO Jamie Dimon has a $1.5 million salary.

- Sundar Pichai of Google makes $2 million in salary.

You only get 312-1 by adding in performance based stock and incentive alignment options. But these don't come from the cashflow of the business like wages and salary. They come from diluting Wall Street. Knowing this, the whole thing is way less of an outrage. The comparison is so uneducated.

If there is outrage over CEO pay, it doesn't make sense to come from the unions or left politicians, it should be coming from activist hedge fund billionaires, which it does. Carl Icahn for example is wildly against this level of CEO compensation because it dilutes his ownership.

John Doe on his forklift stacking pallets in the Coca Cola factory is not made poorer over excessive CEO pay. Carl Icahn is.

Re: How People Get Rich Now

#434

Post by kelnos »

true_religion wrote: post #272
lolive wrote: post #139

Earlier quoted context omitted.

Just like RMS is highly respected at the FSF :)

I understand the comparison, but the FSF can exist without RMS. PG on the other hand solely supports HN, I doubt he would continue to pay for a site that vilified him.

PG doesn't run YC anymore (he retired quite a few years back), which is the org that pays for HN.

Re: How People Get Rich Now

#435

Post by TacticalCoder »

tubularhells wrote: post #398
nindalf wrote: post #71

It's a classic PG article. Many true facts in there, lots of good analysis with just a few questionable claims thrown in here and there. At the end, there's a massive claim that isn't fully stated but implied. "Of course the Gini coefficient is increasing" translated means "income inequality is not a problem". Firstly, Gini coefficient is based on income, not wealth. That isn't stated clearly. Secondly, there's absol…

I had the same feeling skimming through the post. What a despicable person this PG turned out to be.

People are entitled to their opinions and there's no need to namecall on HN.

Re: How People Get Rich Now

#436

Post by labatyd »

UnpossibleJim wrote: post #46
api wrote: post #22

Earlier quoted context omitted.

I'd be more interested in a study of how people move from lower classes to at least upper middle class.

https://www.visualcapitalist.com/the-decline-of-upward-mobil... Here's a chart that tries to show the decline of upward mobility in the U.S. with an article that explains it. While, from the reading I did while trying to find this - which was not a huge amount - it does appear down, somewhat, worldwide, it is in a much sharper decline in the U.S. on average. This, of course, is in comparison to European nations. Not…

Starts at decade born 40's and goes from there. This is the moral equivalent of starting in mid March to look at stock gains. If we had the same information from the founding of our country until today it would probably look closer to a U with "born in the 40's" being pretty damn close to the top of that U. This should not be used by anyone to make any conclusions.

The world just went through massive war that destroyed nearly all of Europes infrastructure and the demand to fix it mostly manifested as opportunity for Americans. Since then Europe has rebuilt and both India and China have arrived on the scene as powerhouses of their own. We will never have the same opportunities that we had then again, or at least we should all pray we don't.

Re: How People Get Rich Now

#437

Post by gip »

greatgib wrote: post #411

Strangely, an explanation for the increased number of wealths coming from new, tech companies and investments that is ignored in his post is the disturbing fact it was taken from the average employee cut of the profits. See this: https://www.theguardian.com/business/2018/aug/16/ceo-versus-... I quote: "The 2017 CEO-to-worker compensation ratio of 312-to-1 was far greater than the 20-to-1 ratio in 1965, and more than…

Exactly. And I also think looking at money only may not go far enough. At the end of the day what matters is the amount of resources that the society allow a person to enjoy during her/his life, from food to home ownership to work opportunities, to access to vaccine.

It's pretty clear that a new class of people (founders, VCs and people close to them) are capturing a larger part of the resources today while the majority gets a decreasing share of that. And we should all be working at finding way to reverse that trend.

Re: How People Get Rich Now

#438

Post by ClumsyPilot »

centimeter wrote: post #418
ClumsyPilot wrote: post #178

Earlier quoted context omitted.

Zoning doesnt matter unfortunately, prices go up in line with maximum possible mortgage amounts. Real-estate prices have no bearing on 'value' of the land or materials. The buyer is convinced that he will get that money back and then some from the next sucker to buy it off him. It a pyramid scheme, detached from real economy.

You’re describing monetization, not a pyramid scheme.

infinitely rising house prices are impossible, so a housing market where everyone expects them to do that is a pyramid scheme, someone will be left holding the bag

Re: How People Get Rich Now

#439

Post by rapind »

eloff wrote: post #45
aqme28 wrote: post #11

I don't think that the top 100 richest people is a good dataset. You can be extremely rich without making it anywhere near that list. While a lot of those top 100 people made it to that list by starting companies, I'm curious how many of them did so by leveraging family or inherited wealth.

To make it on that list, you have to have succeeded at such an extreme outlier level that almost by definition almost everything had to have gone perfectly. That takes a lot of luck and advantages, such as family advantages. I'm not saying that detracts from what they accomplished, but they can't take all the credit either and it's not reproducible.

It should detract from what their accomplishments appear to be though. Our society worships the ultra rich mostly without recognition of societies own contribution.

Where would Amazon be without pre-existing innovation and infrastructure that the public paid for? Systems like roads, education, technologies, safe working environments, etc.

We tend to regard these uber rich as though their success happened in a vacuum and all of those billions are justified.

(I’m not accusing the rich themselves of necessarily promoting or having this view point. That would vary by case. Just that it’s society’s view in general.)

Re: How People Get Rich Now

#440

Post by thegrimmest »

lotsofpulp wrote: post #424
thegrimmest wrote: post #407

Earlier quoted context omitted.

> If people are feeling more volatility Do you think this feeling is reflected in actual risk though? If so, how would you quantify it? If not, shouldn't we expect/teach people not to feel so volatile and be more grateful and content?

Yes, the easiest way to see it is in the lack of income security and wage stagnation for the vast majority. You have to hustle, your employer may not be around for your working lifespan, or they might be obviated by cheaper labor from overseas and/or technology and automation. Edit: Another example is health insurance is tied to your employer in the US. It costs anywhere from $400 per child per month to $1k per month…

Doesn't the article point out that this is pretty much the normal condition of life, with a brief interlude from the 50s into the 80s? Yes, life is unpredictable, bad things happen for no reason. This is a moral condition we all have to accustom ourselves to. I'd speculate that the pain our society seems to be going through now represents a correction towards the normal condition, and that we should adjust our expectations accordingly.
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