I’ve gone the other way with this. I’ve significantly cut my spending down in the last couple years. No more eating out, no vacations, grow my own food, don’t eat meat, no ac and minimal heating to only to keep pipes from freezing. Even with all that and more I’m spending as much as I did a few years ago but a much more restricted lifestyle. Be cool if my pay rate kept up with this inflation but my union agreed to a shit contract just before all this started.
“Everything is very expensive, and people can’t save money”
FTFY
Its a curious state of affairs, because the stock market has been booming all the while.
If you have savings you’re getting enormous passive incomes. 20-30% jumps in accumulated investments annually. If you don’t have savings you’re watching prices skyrocket while salaries flat-line in the face of anti-inflation economic policy.
This does kinda raise the question “Where are equities markets getting all this extra cash from?” And the answer appears to be… its very profitable to charge people more and pay them less.
- It’s* a curious state of affairs
- it’s* very profitable
Literally nobody was confused by those grammatical mistakes, this is just a stupid grammatical rule designed to be a gotcha that grammar people can wield as proof that someone isn’t well educated.
Put the apostrophe wherever the hell you want, just write in a clear way that gives enough context that unless someone is a computer program incapable of tolerating slight grammatical mistakes they will understand fine.
The stock market is a measure of how much wealth can be extracted from the working class.
It does not measure the health of the economy. That sometimes the market is doing well as the economy is doing well is closer to coincidence than causality.
The fact that the working class can no longer save money, and must spend every dime is great for the stock market. Next they will come for the dollars we have not spent yet. Because mortgages are no longer feasible for most people they’ll have to find new debt traps. Cars will skyrocket in price, you’ll be able to take out a loan to rent an apartment. Student debt will spiral to laughably unrepayable levels.
They’ll take every dime we have, then they’ll take every dime we’ll ever make. And when it gets to the point where there’s no more money to bleed, unless a new source of endless dollars can be found, the market will feed on itself.
If you think peacefully protesting Wall Street is going to fix that, I’ll sell you the Brooklyn bridge.
They’ve already taken every dime we’ll make, plus every dime our children and grandchildren will make… That’s what the trillions of dollars in debt is.
The stock market is a measure of how much wealth can be extracted from the working class.
I’d argue it goes beyond that. Quite a few ticker symbols on the NYSE are speculative above and beyond anticipated surplus extraction. They’re functionally auction prices on coveted luxuries.
Because mortgages are no longer feasible for most people they’ll have to find new debt traps. Cars will skyrocket in price, you’ll be able to take out a loan to rent an apartment. Student debt will spiral to laughably unrepayable levels.
These have largely come to pass. The “loan to rent” is just your deferred payment on credit card debts to cover rising rental rates.
If you think peacefully protesting Wall Street is going to fix that, I’ll sell you the Brooklyn bridge.
Sure, I can buy it. I just don’t try to cross it for fear the NYPD will arrest me.
stocks are as divorced from actual value now as cryptocurrencies. real estate too. it’s all grift all the time. have a look at the value of djt or tsla, they’re nfts.
it’s all grift all the time.
Its decades of cheap lending to people with all their consumer needs satisfied. If I can borrow at 4% and get 20% ROI, I’m going to borrow every dollar I can get my hands on.
On the flip side, you’ve got private lenders offering double-digit interest rates to the underclass. They’re lucky to get a cost of living increase year over year. So you’re asking people to borrow at 20% with the expectation of a 2-4% ROI.
have a look at the value of djt or tsla, they’re nfts.
DJT is fucking hilarious, because its pure vaporware. But TSLA does actually have factories and vehicle stock and revenue streams and such. Its mismanaged and overvalued, but there’s some amount of there there.
But who is holding Tesla? Vanguard Group, BlackRock, State Street Corp, and Geode Capital Management all have access to the Fed credit window - either directly or through proxies - and can borrow at miniscule rates. They get a positive ROI so long as Tesla appreciates at all. And the long term ROI on an electric car company looks pretty good, even if its overvalued in the short term. So buy buy buy!
Look up the Haymarket square protest.
“A harsh anti-union clampdown followed the Haymarket incident and the Great Upheaval subsided. Employers regained control of their workers and traditional workdays were restored to ten or more hours a day. There was a massive outpouring of community and business support for the police and many thousands of dollars were donated to funds for their medical care and to assist their efforts.”
bootlickin’ since time immemorial
Support for the 8 hour day also blossomed after the Haymarket incident. It lead directly to May day.
you’re right, but i’d love to see, just for once, the people clap back with fierce resistance that amounts to “FUCK YOU I WON’T DO WHAT YOU TELL ME”. fuck the waiting period of change. i just want to know that we have the power to resist without compromise.
and when i say ‘the people’, i really mean the radical progressives.
It’d really be great if journalists even attempted “educating” readers or providing meaningful context. But then again, would it get this kind of traction?
The interesting story here is that interest rates are raised to SLOW spending and encourage saving. The interest rates spiked to CURB inflation. It has worked, despite most journalists seeming keenness for it not to, for the most part. If consumers and businesses reduce their spending due to higher costs of borrowing, this will bring down prices over time, aligning with the Fed’s inflation targets.
No one explains this to the average person, ever. Ironically, the story here should be consumers are spending money even when saving it should be incentivized because they can’t afford not to… because of profiteering by large companies, grocery chains, etc as well as stagnate wages for the past few decades. This means that inflation will creep up faster than it should because of demand-driven inflation. This makes the problem worse for low-income earners.
It seems to me that THAT type of inflation might require less of an “interest rate adjustment fix”, and more of a wage adjustment fix. Even potentially a regulatory fix to go after price gougers.
douchebags gonna douche
I love how Fortune always deflects from the actual issue: wages aren’t matching prices, which means the average American is getting screwed by company owners and wealthy investors, at work, at the bank, at university.
It’s not about interest rates or inflation, although those are both relevant. If inflation were evenly balanced, it wouldn’t hurt most people, right? That is definitional. And high interest rates block house purchases, but in theory they also benefit house owners who have fixed interest rates. So again, if people were able to afford houses in the yhr past few decades, this wouldn’t be such a big issue.
“Getting screwed by government”
That’s the primary issue. Stop deflecting from the fact. Government is and always has been a problem. Fix government spending, checks and balances, audit the fed thoroughly, and everything else will fall in line.
Stop spending on war. Problem solved.
Facts. Not just that… our government is infatuated with spending tax dollars on really stupid studies. For example quails high on cocaine.
And these amongst a long list of other wasteful spending:
Fauci’s NIAID spent $478,188 to turn monkeys transgender $6.9 million smart toilet analyzes “anal print” Feds give $300,000 to virtual reality penguin study The State Department gave $25,000 in grants to Chinese surfers Harvard spent $75,000 in federal grants to blow lizards off trees with leaf blowers
Bootstraps are too expensive to buy because your daddy thinks his broken ass house should be worth a cool mil.
We’re in late stage capitalism. Getting rid of the gold standard was one of the biggest mistakes in US history.
laughs in Calvin Coolidge
Yes. YES! Let the Austrian Economics flow through you! Speculation is a consequence of federal monetary policy and commodity inflation. I can’t possibly have anything to do with private credit or free market auction rates.
I find people who make this “argument” very silly. The gold standard is unsustainable. The amount of cash in circulation will always outstrip the amount of gold in whatever vault it been tied to. Fiat money is always an economic inevitability for a growing state.
The amount of cash in circulation will always outstrip the amount of gold in whatever vault it been tied to.
That’s… the entire fucking point. They printed away our futures, now we suffer.
They printed away our futures
If the amount of potatoes we produce every year goes up and the amount of currency we print every year goes up but the amount of gold we have in our vault stays fixed, the real economy doesn’t care. You’re trading dollars for potatoes and potatoes for dollars. The gold is irrelevant.
But if potatoes go up and currency stays fixed, you have too few dollars chasing too many goods. This deflates the cost of the potato and discourages the next crop. Smaller crops mean food shortages. And food shortages impact social stability. So now you’ve got riots from a food shortage that was created entirely because you didn’t print enough currency to buy up all the potatoes.
Riots from a food shortage because potatoes became too cheap? Funny speculative statement. What about riots because everything is too expensive?
Riots from a food shortage because potatoes became too cheap?
Riots because people stop growing potatoes and start growing bitcoins, in order to chase the highest possible ROI.
What about riots because everything is too expensive?
You’re looking at debt without looking at revenues.
Far worse to owe $10 when you make $10/year than $10M when you make $10M/year. Particularly when I the value of the asset I’ve purchased is rising faster than the debt-rate. Owning a $100M house on a $10M note is an incredibly deal. Public Debt in service of GDP growth is simply investment. And the ROI on that debt has been incredibly good.
The government runs out of money… so it drops the gold standard to “to invigorate the economy”… by taking away value from those that hold cash… which is always the lower class. Higher classes hold assets that dont inflate away.
The problem with this argument is that it neglects the consequence of specie entering and existing the market.
The California and Alaska Gold Rushes did more to devalue the money supply than anything Nixon tried. The Spanish economy of the 1700s imploded in the face of the gold glut it imported from the Incas and Aztecs.
A gold standard doesn’t stabilize the money supply. It simply deflects the question of what that money supply should be onto the private commodity market for gold. But volatility in the gold supply does happen, particularly during times of economic turmoil. And a pegged currency encourages private arbitrage, which increases the frequency of these sharp shifts in gold availability.
And that’s not even getting into what happens when you’ve got a private speculative asset independent of gold - maybe we call it real estate or company stock or cryptocurrency - that siphons off investment dollars one minute and floods the market with currency/commodity-hungry panic sellers the next. Even if you’ve got a stable gold/currency ratio, these aren’t the only two variables in your economic model.
No amount of gold changes the number of potatoes the Irish have to eat.
Holding cash makes it sound like it only impacts those who have cash savings, but it takes value away from the work you do as you get paid in cash and those wages never keep up to inflation from the printing machine. So they “invigorate” the economy by devaluing your work.
That’s only true when you are dealing with the infinite growth of capitalism. Nations and empires have used the gold standard for thousands of years. It only became “impossible” when we tried to inflate the value of economies into the stratosphere to enrich the aristocrats of society.
Nations and empires have used the gold standard for thousands of years.
Crack open David Graeber’s “Debt: The First 5000 Years”. He’s an anthropologist who spent his career investigating this theory, and he found it wanting. Hardly the first, but probably a more fun read than Thomas Piketty or Milton Friedman or Adam Smith. Nations and empires didn’t use gold specie until fairly recently in human history. Most of human civilization revolved around different types of credit and debt, typically enumerated in volume of agricultural produce.
Wheat/corn/rice, fish, olive oil, and salt were the most common standards of exchange. Gold was ornamental, but far too little of it existed to circulate as common currency or even reserve currency. It wasn’t until the colonial era and the mass exploitation of Africa, East Asia, and the Americas that European Banks had a large enough surplus gold reserve to treat it as coinage.
So you’re talking at best hundreds of years, and even then only within the handful of European powers capable of plundering the gold reserves of foreign nations on a global scale. And even that only got these countries from the 15th to the 18th century before the system started breaking down.
Ok. Fair. Let me correct myself: money was based on material goods and not rich peoples feefees about the economy.
Definitely closer to the market. Although one major form of historical debt is taxation, and that’s traditionally been subject to how rich people feel about the economy.
It blows my mind that the world basically runs on Monopoly money and accounting smoke and mirrors.
For a while now, I’ve had a hypothesis that money does have a real, tangible underlying asset attached to it, in the exact same way as it used to be backed by gold or oil.
The underlying asset is human capital and the value is derived from human labour.
The reason for my belief is because private banks actually create 80% of the money in circulation. They create this money when they issue loans.
How do we determine the amount of loan we can take? The amount of money we earn. We earn money either via our own labour or someone else’s. Ergo, money is created at the value human labour you own, like how we used to do so with gold and oil.
Money here acting as both an iou and as a labour token, in the same way a British Bank note was both an iou for gold and affected gold prices, we have been buried under a labour debt our great grandkids would come close to paying off. Printing of future Labour ious also depresses wages for everyone who works for their money.
Imo, its much worse than monopoly money.
Every currency’s value is “potential to convince others to do labor for you”, that doesn’t make fiat different, it would be a chicken and egg problem otherwise.
The value of a currency is “what makes people want to accept this currency?”. The answer is taxes. You live in a state. That state requires you to pay taxes in a currency (or set of currencies). Doesn’t matter how much gold you have, if you want to keep your house in country X, you have to pay it for property taxes in a currency that that state accepts, otherwise that state’s police will revoke your ownership of the property.
States have a monopoly of violence, therefore currencies have value because it’s the only way to preserve your ownership of property via taxes.
The difference being, like in the roman times you’re referring to, the coins at least had some other kind of underlying value.
I agree that was heavily inflated and, eventually, the value of the coins became more than the value of the metals the coins ended up as after clipping etc.
However, now there isn’t even that pretence. Human labour is the underlying asset here imo.
It’s not that I dont know how money works. Its that I think about it differently. To me, it makes a lot more sense than just that we believe in it really hard, with extra steps. Its that now, the rich get to keep hold of the gold too.
A way to think about the idea is the financial crash. “Sub prime mortgages” means “fraudulent loans to people who didn’t exist” (money creation). The money created by those loans was spent a thousand times over, all due back to bigger banks who leant them money, with new loans and made with them as collateral and all packed into toxic financial instruments. When it was found out that those people didn’t exist, the money literally disappeared. Thats how “companies balance sheets just vanished.” Thats whys Governments had to print money: because the money had vanished and there was a gapping money void due to it.
There was no one to work off the value of the money that had been created and, just like if you found out thr bank didn’t have any gold (back in the gold standard days), the IOUs (money) would be worthless.
To me, it point to seeing the world as a human labour farm and the currency is human labour IOUs, in the same way cotton, sugar and steel nails and their IOUs in Virginia, the Caribbean and the North East of England respectfully were also used currency or were the equivalent of currency.
A way to think about the idea is the financial crash. “Sub prime mortgages” means “fraudulent loans to people who didn’t exist” (money creation). The money created by those loans was spent a thousand times over, all due back to bigger banks who leant them money, with new loans and made with them as collateral and all packed into toxic financial instruments. When it was found out that those people didn’t exist, the money literally disappeared. Thats how “companies balance sheets just vanished.”
Uhhh that’s not what the sub-prime mortgage crisis was. What you’re describing was extremely risky mortgages being rubber-stamped to borrowers who shouldn’t have received them, then bundled into Mortgage Backed Securities (basically a type of bond backed by, say, 500 mortgages containing a variety of risk profiles designed to balance out into a low risk but decent yield investment) and the fraud was that too many of these high risk mortgages were bundled into these securities and the risk level was misrepresented to investors, so when people defaulted on their mortgages in large numbers this caused the MBSes to rapidly devalue (which given they were treated as a way to protect capital against instability this greatly damaged many funds such as retirements and bank investments, 2 things that are heavily regulated to make safe investments because the risk is too high should they fail)
Or just go read the Wikipedia page for far more detail: https://en.wikipedia.org/wiki/Subprime_mortgage_crisis
Well yeah. If you trace it backwards, before fiat, what was commodity backed currency? What inherent value is there to gold and silver? Back then there was little industrial use, it was just useful as something to trade for other things.
So going back further, at it’s core, currency is just a middle man to bartering. Instead of trading the grain you labored to grow for shoes from the cobbler, when you don’t need shoes right now, you take gold/shells/beads knowing you can use them to trade for repairs to your plow from the blacksmith. Currency has always been a social construct, not inherent to the commodity.
This is actually one argument against the hoarding behavior of the ultra wealthy. It disrupts the natural economy and creates unhealthy power dynamics. The rich person can distort labor away from productive things healthy for future development of the society, say by using their vast wealth to pay a ton of farmers to build statues of the rich guy, until suddenly there’s famine because no one is growing food.
So going back further, at it’s core, currency is just a middle man to bartering. Instead of trading the grain you labored to grow for shoes from the cobbler, when you don’t need shoes right now, you take gold/shells/beads knowing you can use them to trade for repairs to your plow from the blacksmith. Currency has always been a social construct, not inherent to the commodity.
This is what David Graeber calls “The Myth of Barter” and has no basis in history or anthropology. Trade was happening for thousands of years before the first currency was invented in the 6th Century BC. There are other ways to arrange trade that don’t require currency as an exchange of value.
For example, if I were a barley farmer in ancient Mesopotamia and I wanted to get drunk before harvest, I could write an IOU for part of my barley harvest to the bar owner. Then, if he needed to buy something he could take my IOU and trade that for whatever it was. This IOU would go round and round the economy, but it also made them pretty unstable if the barley crop didn’t meet expectations.
If this is interesting to you I highly recommend the book Debt: The First 5,000 Years which goes into a lot of detail about many different economic systems that have existed.
Think the point is that alternative strategies were in play when the biggest, most overwhelming cities in the world were maybe 100k people, the world population was 1% of what it was today, and economic activity was relatively limited in what sorts of goods and services were for trade.
Currency came about because as the indirect bartering relationships became overly complex and the number of participants exploded.
Though the currency situation did set up a sort of ‘meta’ of gaming the numbers for sake of the numbers themselves, which grew out of control until breaking the gold standard. Of course it’s still out of control, but what we see is nothing compared to the instability of a gold standard currency trying to tackle current day human activity.
I’m not an expert and really a bit of a moron, but it’s nice to actually see something I “thought of” taken seriously. I’ve argued with friends that money really is just “human potential energy.” The only thing you do with money is “inspire” others to do work. I usually just get laughed at though lol
Sorry to hear that. Personally, and I might be a millions miles off here, i find its usually only stockbros who react that way. You know, the kind who get their financial advice from wallstreetbets.
I know that it’s a radical idea to lots of people and I may end up being ultimately wrong but I think its a position I can a least logical argue. I think better than the “power of friendship” or infinite debt loop of debt that isn’t owed to anyone, nor does it ever have to be repaid (making it, by definition, not debt).
For me though, money would be an IOU for human labour, exactly like the old British pound was a literal IOU for gold. Its not far from what you said at all, tbf, but I think its more sound wording. Kind of the technical long form of that which could exist in our society.
Ultimately, the question is: “What is the dollar a unit of?”. The answer is roughly “energy” in the physical sense, or effort/labor in more human language.
What I think is interesting is that then, the social and physical definitions of the word “power” collapse into the same thing; one with more “power” is able to expend more “energy”, the labor of others, in a shorter time.
If you’re really interested in the topic, read the book “Energy and Civilization: A History” by Vaclav Smil, published in 2017. It covers the efficiencies of tool use and how innovations in technologies that caused increased labor efficiency have catalyzed societal changes and revolutions, even going so far as to discuss GDP in units of Joules.
Why You’ll Never Achieve The American Dream https://youtu.be/vu7IJ-HDIos
And that’s while already having a trillion in credit card debt.
The wonderful thing about debt is, if you have enough of it, it suddenly becomes somebody else’s problem.
Well, you gotta be asleep to believe the American Dream, so maybe this means a lot of people are waking up.
By brother in Satan, high inflation makes you spend money now. It’s either that or going to hell.
Im saying that this bs is out of some relative comparison of how much generations are saving/investing. Everyone tried saving. But with low relative wages ofc ppl wont save as much as eg boomers - they didn’t give up vacations or buying whatevers, but still saved money. Younger gens are just left with no money after that.
And also falling relative wages (inflation) makes you buy things asap to actually save money.
If you would have bought a basement full of canned food somewhere shortly before corona or shortly before the russians went full loco in ukraine, it would have been a top tier investment. And if it wouldn’t have been, they don’t go bad fast and you can still eat them :') In high inflation environment, buying stuff instead of stacking money can make sense indeed.
Why grind when production is way higher than needed.
Just eat the rich.
Historically it always led to an era of prosperity.
It’s literally cheaper to buy things I know we’ll need at some point (assuming we have the space to store the thing) using a rewards credit card that’ll give us 1-3% back than it is to save and buy those things later when they’re even more expensive. (Paying off the CC before it accrues interest, of course.)
The only move that is ‘smarter’ is to be risky with our money and invest in some way. Which then either makes me a part of the corporate enrichment cycle or a member of the rentier class.
The only move that is ‘smarter’ is to be risky with our money and invest in some way. Which then either makes me a part of the corporate enrichment cycle or a member of the rentier class.
Online savings accounts also exist.
A solid suggestion.
I often discount those because I think of them in terms of cable TV pricing, that you have to hop around on to get the maximum benefit. It seems that there’s no trustworthy info to find online these days, so I don’t really know how they stack up, or even if my assumption about them is correct.Something to add to the vast hopper in my brain labeled “things to research if I ever find enough time.”
Ymmv but I’ve found Ally Bank to be good and the rates fluctuate with the baseline rates. I think you get over 4% interest right now. I’ve seen them go up and down just as the fed makes movements, unlike my ing direct account (which became capital one or something) where the rates only ever went down.
Investing isn’t that cheap, especially if you want to be moral about it (no shadow pools, company screening, etc). Coz you know, you are just fueling the same problem you are solving.
Yup.
Every time I read the phrase ‘the American Dream’ I think of the part of Fear and Loathing in Las Vegas when, after spending the whole novel trying to find the American Dream, they’re given directions, only to find the remains of a burnt-down nightclub, “a huge slab of cracked, scorched concrete in a vacant lot full of tall weeds.”
Fear and Loathing should be required reading in schools. A lot of the meaning gets lost in all of the drugs, but in the midst of that haze one can find a lot true things about America.
Never read it because I assumed it was just a funny story about guys on drugs with his characteristic cool writing style, but if it had actual things to say about America, maybe I’ll read it sometime. Or watch the movie lol.
The movie actually takes all of that out unfortunately and makes it much more of a funny story about guys on drugs. I still like the movie, but the book is so much deeper and more meaningful.
I liked the book and I was surprised how close to it was the movie, the part tgat got there. And yes, they left out many things, but it’s understandable, because the movie was planned as a “funny movie”, not a “socio-economical movie”. So the book was like “drugs-capitalism-drugs-Vietnam-drugs”, tgey cut out all the “boring” parts, leaving only drugs.
The movie is cool though, but It’s just me always trying to appreciate what is shown to me, and not trying to compare with another media.It’s definitely not a bad movie or even a terrible adaptation of a book. Like you said, it just had a different goal with the same story. That’s fine.
I think of the Carlin bit… It’s the American Dream because you have to be asleep to believe in it.
Thompson rightly concludes that the American dream is already dead by the 70s.
If you look west you can almost see the place where the wave broke and rolled back…
Thompson rightly concludes that the American dream is already dead by the 70s.
Important context for that is that the novel is a famous, and relatively early meditation on the failures of the 1960s counterculture movement and the intense, if ultimately unfocused vision for a better future for the nation that was central to it.
This is what happens when history is forgotten. Obviously we’ve had inflation B4. Don’t read all the negative sh*t out there. And don’t let other people with their agenda run your life.
We’ve had inflation before and, on a historic timescale, we’ve had revolutions to correct that inflation. France existed for almost a thousand years before they had the big one.
Pretty fun stuff I mean I wonder where it is going. Will there be some kind of collapse crisis or smh
