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Location: Where nothing ever grows. No rain or rivers flow, Texas
1,085 posts, read 1,581,344 times
Reputation: 468
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Its not a recession, its a shakedown because the world is changing. its been a slow change and we got all the warnings. If youre still a pilot, astronaut, accountant, lawyer, customer service, english major, store owner and all those pre computer age jobs then you were being lazy dreaming and stubborn.
Your cousin is probably the worst example of someone being 'killed' by the world changing. He chose to own a business/his own boss probably like the others who laugh at the geeks/drones going to school/work everyday. he chose to make the big money from peoples vices, he chose to consume all those bacon, eggs, barbecue, alcohol and partied I bet. Youre no different from all the unskilled laidoff folks blaming everyone else except yourselves.
One thing to remember is that the "appearance of wealth" is not "actual wealth." Your net worth financially is your assets minus your liabilities. While you may see Joe Blow up the street with a new car or home addition or whatever, you do not know how much of that was financed on a loan,credit card or other line of credit and how much other debt that person has(student loans,credit cards,medical bills,car loans,remaining amount on mortage,etc). Some people that "appear" to be doing fine, are plain and simple a paycheck or two away from bill collectors. Dave Ramsey makes this simple truth in his books.
A sad truth is that most people are worth fairly little. See my example below:
Sample net worth of a couple with both spouses working in what appears to be an upper middle class neighborhood and lifestyle. Income from both totals $110,000. Age may be approximated as early to middle thirties.
Assets:
1.Each has about $20,000 in their 401k or other retirement vehicle if lucky. (See link below) Even if we are generous and one has $30,000 and another $25,000 that totals $55,000.
2.Checking,savings,CD's,and other non 401k accounts total $9,000 between all accounts.
3.Equity in home as a sample figure at $50,000
4.Net value of 2 cars is $12,000.
5.Possessions of furniture,electronics,and all the other stuff is $18,000.
Liabilities:
1.Mortgage remaining is $210,000 on the $260,000 home.
2.Credit Card debt is $15,000 on all cards.This might be low for some certainly.
3.Car loan is $8,000.00 remaining
4.Some medical bills at $2,500.00
5.Oustanding student loan at $15,000
6.Other loans for home improvement at $3,000.
Although these are very rough approximations and some may not have medical or even student loan debt you see where this is going.
All of this talk about the economy.... you think we are suffering? Pretty sure i dont see kids dying of malnutrition in the streets, pretty sure no one is starving to death here, pretty sure we have sewers, trash collection and food for the poor and our children are at least learning basic skills like how to read and basic math.
why dont you go to a country like Niger or Chad or Mauritania or Cambodia or a plethora of others so you can see what poor people really look like? you wilk see that we dont have it so bad. America is an incredibly wealthy country.
Yea, but you forget -- us Americans only think about ourselves. We're all entitled to 2 cars built within the last 5 years, a smart phone with data plan, being able to eat out two or three times a week, 40 hour work weeks with weekends off, cable tv, and high speed internet. If we can't have all of that without having to educate ourselves or work our way up from the bottom,then someone better have some answers!
Several years ago I was curious if you folks still employed were making any progress in salaries or treading water. Dh retired in 1992 so I have no clue what folks earn today, except for my kids. They all took pay cuts on the pre school, private school and University level. The kids in media are doing OK. Back to inflation. I took DH's salary when he retired to an inflation calculator. I think salaries of middle and upper management are about the same as in 92. I figure most everybody is just treading water. Oil company bonuses are another story. Do they get stock options?
I am doing fine as is everyone I know that is middle class and college educated.
I know dozens of smart, college-educated people who are NOT doing well. They work in education, social services, business (not oil and gas), and technology.
Several years ago I was curious if you folks still employed were making any progress in salaries or treading water. Dh retired in 1992 so I have no clue what folks earn today, except for my kids. They all took pay cuts on the pre school, private school and University level. The kids in media are doing OK. Back to inflation. I took DH's salary when he retired to an inflation calculator. I think salaries of middle and upper management are about the same as in 92. I figure most everybody is just treading water. Oil company bonuses are another story. Do they get stock options?
I am in oil & gas but I can tell how how I am doing. In Feb 2009 when things got really ugly I took a 10% pay cut. That lasted until Dec. 09 when I got 5% back. In 2010 I got a 9% pay raise and then this year I got another 9% pay raise so all in all I can't complain.
Location: Where nothing ever grows. No rain or rivers flow, Texas
1,085 posts, read 1,581,344 times
Reputation: 468
If you think about it, the 'old prosperity' was all made up anyway. you can thank your real estate professionals for that.
I'm just your average h1b IT worker, I'm actually way behind on the technical stuff. I have never taken a pay cut in my entire life, eventhough I went over my pay bracket (I refused to be 'management' (thats a tip for the next gen)), eventhough I moved from NYC to Houston. Heck even that I yell at my own bosses, no pay cut. I quit the employee gig in 2009, went to become an IT contractor and doubled my pay. this is my 3rd year making 250k-300k+ a year just by myself, my wife just retired to take care of the baby although she wants to get back as soon as the kid is ready for a full day of school. Nothing much changed in our life style. We still live in one of Houston's most 'unpopular' and cheaper neighborhoods, still surrounded by simpletons, no new cars(yet), no house additions/alterations < $1k per room, the backyard is still a yard. The only thing that is new to us is we actually got a $9/mo alarm service, after 3 years owning the house. I still do not think its necessary but I just want to be registered.
Four years ago, when we got to houston and went house shopping, I noticed alot of the people living in popular sparkling new neighborhoods and 'owning' brand new 'entry level upscale car' do not deserve all that. I also think some people retire from whatever job and upgrade to extravagant houses for some reason. This is not the type of 'HO peer pressure' I want, I wasnt ready for that I thought. I didnt even know about the different types of loans people are taking on. As a first time homeowner I was set to put 50% down (i thought that was right) so i was only comfortable with a <200k house.
A lot of my friends think I'm *too cheap*. One guy lives in Cinco Ranch... pushes his kid to work at footlocker and other stores...he has no savings, zero college money for his HS graduate. Others say its just good parenting to move to the grand MPCs... one guys daughter got married to a (now) tow truck driver after HS, living with them. It seems women are just being raised to be housewives out there. another proud parent I know raised roughnecks oil/construction guys. I really do not get it, this 'old prosperity' thing.
Bring back tariffs = bring back our manufacturing jobs
Solution.....
Higher income taxes on income $$$$ earned on overseas investments.
Lower income taxes and higher incentives for domestic investments.
We can't really stop the flow of $$$ BIG MONEY overseas. I mean, the potential profits in some of these developing countries are huge.
But we can create incentives for invention, business creation and investment at home.
And above all, create incentives for investment in education, invention and sound small business growth.
It's the little guy who'll most likely stay at home, invest at home and hire domestic workers.
The big guy is so huge.....he's got so much $$$$ and mobility, he can afford to go anywhere.....
China, India, Kenya.....the world is his $$$ home.
He only needs a US passport and address as a convenience.
The key to stimulating domestic growth and middle class wealth is to minimize the overall costs of education, healthcare, transportation, financial services and housing. People need some leftovers-spare change that they can invest.
Will the IT industry be a catalyst for some dramatic change in the true cost of delivery of these services......
Taxes aren't going down for now.....especially with all the wars the country has to pay off. Bush has definitely mortgaged out the nations' grand kids' future. So forget about lowering taxes.
The rich will find a way not to pay them.....and the middle class will HAVE to pay them.
What you'll see in the near future.....is the class-baiting of the middle class against the poor and underemployed.
You know, get the middle class to ***** about paying taxes and supporting the lazy bums on welfare......so the rich (who started all these wars that the middle class is gonna have to pay off)......can live in peace.
I am all for low for no-frills, non-profit state banks, state sponsored non-profit insurance companies....and even expanded public and low cost healthcare. Anything that'll deliver services efficiently and cheaply, so the people can have money left over for independence, inventions, investments and a decent life.
Last edited by SadieMirsade; 07-23-2011 at 05:51 PM..
My daughter and I were trying to figure out the difference between my generation and hers. When she was born, we started saving for her education. The way financial aid is calculated these days a family is penalized for saving. The banks want folks to borrow for their kids education. They have gamed the system. IMO, for a graduate to be saddled with college loans when they are starting out in life is unconscionable. When she was a child and needed to see the doctor, we paid for it. We also paid for needed medication out of the grocery money. Now the dr. has to put on staff to manage insurance claims as does the pharmacy,driving up cost. We had major medical. It paid for needed test and hospitalization. Now it cost 1000K a month for hospitalization. We have always thought business and our culture has convinced moms that they must work. They now get 2 workers for the price of one. Our conclusion is that banks and insurance companies are running the country, every way they can.
My daughter and I were trying to figure out the difference between my generation and hers. When she was born, we started saving for her education. The way financial aid is calculated these days a family is penalized for saving. The banks want folks to borrow for their kids education. They have gamed the system. IMO, for a graduate to be saddled with college loans when they are starting out in life is unconscionable. When she was a child and needed to see the doctor, we paid for it. We also paid for needed medication out of the grocery money. Now the dr. has to put on staff to manage insurance claims as does the pharmacy,driving up cost. We had major medical. It paid for needed test and hospitalization. Now it cost 1000K a month for hospitalization. We have always thought business and our culture has convinced moms that they must work. They now get 2 workers for the price of one. Our conclusion is that banks and insurance companies are running the country, every way they can.
I'd recommend you take your money and hide it....any where and any way you can. Send your daughter to school overseas. Lower tuition and lower living costs. I'm seriously considering that option for my son. He can do his undergrad overseas....and grad school in North America, EU or the UK. Much cheaper alternative and an opportunity to pick up a couple of languages along the way.
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