U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 06-23-2019, 03:00 PM
 
Location: Warwick, RI
2,617 posts, read 4,006,078 times
Reputation: 4276

Advertisements

Quote:
Do the rich get all the gains?

No, the smart do. There's an old saying that goes "a fool and his money are soon parted" for a reason.
Reply With Quote Quick reply to this message

 
Old 06-23-2019, 03:03 PM
 
71,459 posts, read 71,629,249 times
Reputation: 49021
Quote:
Originally Posted by Chaofan View Post
If one has nothing saved, one gets no advantage when interest rates increase. if one has nothing invested, one gets no advantage from market gains.


People with modest incomes who prioritize investment and actually allocate part of their income to investments so that they actually have investments realize gains when there are gains to be had. Their gains will be more modest than those of wealthier people who can allocate larger amounts of money to the market, but they will still realize gains, which can, in turn, realize more gains if there are more gains to be had.


People who have put assets to work in the economy realize gains. The economy doesn't care whether those people are rich or poor except in relative rates of return. Those assets don't necessarily have to be money. Talent is an asset. Effort is an asset. Perseverance (currently being called "grit") is an asset. Even personality is an asset. Luck can also be considered an asset, but it provides much better returns when other, more controllable, assets are deployed first.


The economy does, however, resemble the lottery in that you gotta play to win.
Even a penny doubled over 30 days is over 5 million, this is the power of compounding ... today our portfolio generates more a year then we made working
Reply With Quote Quick reply to this message
 
Old 06-23-2019, 03:21 PM
 
322 posts, read 106,075 times
Reputation: 593
In the past working conditions were so bad and unsafe, unions were formed. I think it's time for another labor movement. Workers are not valued by employers, and they have no voice. I'm not even pro union, but something needs to be done. Amazon CEO is wealthiest man in history, $200 billion...for one man. They pay zero taxes. It's pure greed. Meanwhile, teachers with master degrees are making $35k, working 2 jobs, drowning in student loans.
Reply With Quote Quick reply to this message
 
Old 06-23-2019, 03:27 PM
 
71,459 posts, read 71,629,249 times
Reputation: 49021
Just what we need , a labor movement so workers can be paid far more then the jobs they do are worth ...no thank you.

Telll those teachers to move to Long Island ,teachers get paid many times that 35k... but in certain parts of the country they may actually have more purchasing power with that 35k...
Reply With Quote Quick reply to this message
 
Old 06-23-2019, 07:14 PM
 
Location: SoCal
13,189 posts, read 6,301,958 times
Reputation: 9808
Why get a Masters degree to make $35k?
Reply With Quote Quick reply to this message
 
Old 06-23-2019, 08:12 PM
 
Location: Olympus Mons, Mars
5,677 posts, read 8,588,145 times
Reputation: 5768
the definition of "rich" or even "comfortable" for that matter is increasing much much faster than the average ability to save money using wage income.

Take a look at this data for Los Angeles County:

1998 : median SFR $185,000, median household income $41,000 (ratio: 4.51)
2018: median SFR $631,000, median household income $70,000 (ratio: 9.01)

Assets are inflating at an astronomical rate, incomes are falling far far behind. So, those with capital that appreciates at the much faster rate (Real estate in hot areas like LA and those with > $1M in stock assets) are getting seriously ahead.

Sources:
http://www.laalmanac.com/economy/ec37.php
https://fred.stlouisfed.org/series/MEHOINUSCAA646N
Reply With Quote Quick reply to this message
 
Old 06-23-2019, 08:23 PM
 
6,185 posts, read 6,355,356 times
Reputation: 2842
Quote:
Originally Posted by concept_fusion View Post
Agree, it's a false premise especially in the age of digital assets and paper money. For instance, say I spend months restoring a junk car I bought for $1000 and selling it to a collector for $20,000 when it's all fixed up. Did I "steal" $19,000 from someone else's pie?

Of course not, I created value and "new pie". The collector is happy, they have a sweet restored car. I'm happy, I made a profit. And if the collector wants, they can resell easily to another collector. Lasting new wealth was created at the expense of no-one.
I wont say you created value and "new pie". You exchanged something that someone thought was worth the $19K this person has. Nothing was really added. Just changed hands.

Quote:
Originally Posted by Listener2307 View Post
No. The rich do get richer in a good economy, but they are not taking it away from the poor. There is opportunity for all.
Not unless there are entry barriers, and other prohibitive factors. That will weed out most people with not enough capital.

Quote:
Originally Posted by NewbieHere View Post
Why get a Masters degree to make $35k?
It depends on how many people have masters in same subject.
Reply With Quote Quick reply to this message
 
Old 06-23-2019, 09:13 PM
 
356 posts, read 108,881 times
Reputation: 790
Quote:
Originally Posted by Huckleberry3911948 View Post
The belief that there is a limited amount of wealth in the world and you can only get it by taking it from someone else is called mercantilism
An old world and third world concept refuted and proved to be untrue by Adam smith
Like the good posts on this thread I come from extreme poverty -came here -worked hard saved -purchased small properties- kept them -and am now affluent
The income inequality movement is nothing more than envy and a denial of cause and effect as to ones own life decisions
Glad you and others were successful.


But there is a certain amount of luck in it too.


Some people invest in property only to lose out on that property due to un-seeable circumstances beyond their control.


So what I hate is when people think everyone who's not rich is just not as smart as they are.


Plenty of people who get rich get rich because of a large helping of good luck and circumstance, even though they may have worked hard to get the seed money to start.


Many poor people also work even harder and invest their money wisely, only to lose their investment for reasons no one could foresee.

I know people who saved a lot of money but their money was wiped out in the savings and loan fiasco, for example. Bad luck.



Just realize that luck/ circumstances often play a big part in both good and bad fortune.


So not all poor people are stupid or bad investors, they're often just not as lucky as you. And not all rich people are smarter or harder working than the poor.


By the way, there's no point in arguing with the rich. They insist they are rich because of their fabulous intelligence whereas they insist the poor are poor because of their stupidity and laziness.

But the most industrious and some of the smartest people I know are poor.
Reply With Quote Quick reply to this message
 
Old 06-24-2019, 03:59 AM
 
71,459 posts, read 71,629,249 times
Reputation: 49021
Quote:
Originally Posted by movingvanmorrison View Post
Glad you and others were successful.


But there is a certain amount of luck in it too.


Some people invest in property only to lose out on that property due to un-seeable circumstances beyond their control.


So what I hate is when people think everyone who's not rich is just not as smart as they are.


Plenty of people who get rich get rich because of a large helping of good luck and circumstance, even though they may have worked hard to get the seed money to start.


Many poor people also work even harder and invest their money wisely, only to lose their investment for reasons no one could foresee.

I know people who saved a lot of money but their money was wiped out in the savings and loan fiasco, for example. Bad luck.



Just realize that luck/ circumstances often play a big part in both good and bad fortune.


So not all poor people are stupid or bad investors, they're often just not as lucky as you. And not all rich people are smarter or harder working than the poor.


By the way, there's no point in arguing with the rich. They insist they are rich because of their fabulous intelligence whereas they insist the poor are poor because of their stupidity and laziness.

But the most industrious and some of the smartest people I know are poor.
Getting wiped out in the savings and loan fiasco is not bad luck , it was a bad investment plan ...it was a bad choice and poor decision.

Diversified broad based funds and indexes are not risky at all ..they are volatile but over the long haul volatility means little as things smooth out .... anyone who got wiped out was speculating in junk bonds or speculating in buying just bank stocks .. that is speculating on the outcome of an individual company .

Had they made the decision to invest in a proper diversified plan they would have grown far more money.

So yes , while those who fail many times financially call it bad luck ,it is really poor choices and bad decisions that were clearly made.

The problem is many who have had this so called bad luck never see it as they really had a poor plan .... it was bad investor behavior that really did them in , not the savings and loan fiasco ...they did not invest , they speculated in one particular industry or stock type and lost.

A diversified portfolio would not even remember the event happened as it grew more and more money over time
Reply With Quote Quick reply to this message
 
Old 06-24-2019, 09:08 AM
 
2,729 posts, read 1,747,774 times
Reputation: 5962
Interesting video.


This is actually discussed in a book I’m reading called David and Goliath by Malcolm Gladwell.

What people fail to see is that many many concepts in life have a U shaped distribution. In other words, it’s super hard to raise kids while being poor. It gets easier and easier as you approach 75k and then levels off. But then, once the income continues to go up it swings back and becomes difficult again.

We often look at “giants”...aka the rich and see their strengths only. But they have weaknesses. Not only that, there’s actually many strengths to NOT having money and being the underdog. The effects in a person of growing up poor or in certain backgrounds, creates a certain mindset.

Being in positions of comfort and strength makes can make one inflexible and unwilling to take risk. You can’t artificially replicate the fierceness with which a true underdog can fight with. Underdogs think and act in ways the “favorite” simply can’t or won’t because of pride. It’s the same reason military powers lose to vastly inferior traditional forces or corporations get crushed by upstarts.

Which is why many cultures have sayings about it taking around 3 generations to lose wealth.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top