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"at some point people will find out that the pensions they have been promised won't be there when they reach retirement." One might argue this has already happ

"at some point people will find out that the pensions they have been promised won't be there when they reach retirement." One might argue this has already happened in the US, just subtly. Inflation (mostly ZIRP driven) has been very high, and is a hidden tax on those with fixed incomes. Perhaps headline inflation indicators are not high, but just look at the largest component of spending (rent) and you realize how difficult it must be to live on fixed pension payments. As a double whammy, seniors who tediously saved money hoping to earn interest income in their later years, find that income yield is near zero. This doesn't even consider the other major component of spending (healthcare)...

deleted 9y ago
[deleted]
notacoward 9y ago
> Inflation (mostly ZIRP driven) has been very high Totally untrue. In 2013-2016 inflation was lower than at any time in the last half century. 2017 has been a bit higher, but still lower than all of 1967-1996. Sure, you can cherry-pick a particular commodity in a particular market to make it seem otherwise, but momentary or local fluctuations in supply and demand aren't really inflation. Inflation is a systemic phenomenon, and it's actually at historic lows. The fact that some people make life choices that subject them to rising costs doesn't really have anything to do with inflation. http://www.usinflationcalculator.com/inflation/historical-inflation-rates/ http://www.usinflationcalculator.com/inflation/historical-in...
- lotsofpulp 9y ago
  Whatever inflation is being measured should be linked to the choices people are making, otherwise what is the point of measuring it? You need to get higher education, at least bachelors if not masters level, in order to secure a decent income. The cost of this higher education increases at a ridiculous rate, and it's one of the biggest purchases a young person makes. Then you need to live near a city, the bigger the better. That's where all the jobs are and since work is much more fluid, you need to be where there are many employers. Also, you the advantages of networking capabilities in cities will give you a shot at going big. Living costs near large cities have also increased at a rapid pace, whether it be a home or rental. If you're going to have kids, you want them in the best schools, so you pay high property taxes or pay for private school. Best thing you can do to increase the odds of financial success for your kids is to make sure they go to school with other rich kids and have an wealthy network. Then you get start getting sick and need medical care. This is also one of life's huge, unavoidable expenses. There is absolutely no way inflation is low for you if you depend on certain medicines, just read the headlines, the price could skyrocket anytime if the patent holder chooses to.
  - paulddraper 9y ago
    > need > need > need I think we are confusing needs with wants. All good things, but all choices, not requirements.
    - lotsofpulp 9y ago
      The data I have seen shows a considerable earnings and wealth gap for those who did make those choices versus those who didn't. No one needs anything other than a cave in the woods with some squirrel meat every now and then, but assuming you are like most people and want to land an attractive mate and secure heat and air conditioning and a future for your children, then you probably want to place your bets accordingly.
      - notacoward 9y ago
        > earnings and wealth gap But does that translate into a quality of life gap? It might not, and needing more earnings/wealth to pay for the same quality of life doesn't make it a rational choice.
- deleted 9y ago
  [deleted]
- richardknop 9y ago
  Inflation measure (CPI) doesn't include real estate (and stocks etc), a single biggest cost young people will have to face in life. Unless they want to rent forever (and rent prices are not included in the official inflation rate either as social housing is over represented). So I can't take such inflation reporting seriously as that's a major omission. And young people are the most affected by this shady way of calculating inflation as they are the ones that need to buy real estate to get on the property ladder. >>> The fact that some people make life choices that subject them to rising costs doesn't really have anything to do with inflation. Buying a house is not a life choice. It's a necessity.
  - notacoward 9y ago
    > Buying a house is not a life choice. It's a necessity Buying a house in a place where real estate will be your single biggest cost is indeed a choice. The way inflation is calculated might not be perfect, but let's not try to make it even more imperfect in a different way. EDIT: also, even with housing factored in, inflation is still low. http://cepr.net/data-bytes/prices-bytes/prices-2017-06 http://cepr.net/data-bytes/prices-bytes/prices-2017-06
    - richardknop 9y ago
      Well couple percentage points make a huge difference cumulatively. 2-3% over 10 years adds up quickly. I don't agree with your opinion though. If you are career oriented and want to be successful you will be drawn to big cities as that's where the best jobs are and where you can get ahead a lot. And real estate is very expensive there. I do think in rural areas it's also your biggest life expense as incomes are lower there. So it's the biggest cost item irrespective of where you live.
      - notacoward 9y ago
        > 2-3% over 10 years adds up quickly. So do those 10-50% raises over ten years. > If you are career oriented and want to be successful you will be drawn to big cities as that's where the best jobs are and where you can get ahead a lot. There's a grain of truth here. I'm able to work remotely, and just in the past month I've worked from a variety of different kinds of environments in four states. However, that's because I've built a skillset and a track record by working in close proximity with others at a bunch of startups plus a couple of larger companies. I understand that not everybody has that option. However, even within a big city you have a choice of where to live. The crappiest place I ever lived was right in the heart of a big city. I've lived in crummy places, tiny places, places with awful commutes, places with multiple roommates to defray the cost. Those were my choices. You might make different choices, but they are still choices. People who make far less money than we do can still find places to live where they can come in every day to clean our offices, cook our lunches, teach our children. If they can, so can we. It's amazing what you can do if you don't enter the rat race of who has the biggest house, takes the best vacations, knows the best restaurants. There will be time for that, after you've built your base. The first few years after college are still part of the foundation-laying stage. You shouldn't expect to be better off materially, and often you'll be worse off for a while. That's life. At least it's not a permanent condition for those of us in tech, like it is for so many others.
- baybal2 9y ago
  The official inflation numbers in US are calculated in a rather dodgy way. You should read about that. Government statisticians take a very big effort to exclude a lion share of basic living necessities out of CPI calculation
  - dragonwriter 9y ago
    > Government statisticians take a very big effort to exclude a lion share of basic living necessities out of CPI calculation No, they don't. Now, policy makers and media often highlight, and some programs are based on, the “core” CPI which excludes food and energy [0], rather than the full CPI, but since the data is collected by sector anyway, it's virtually zero additional effort to calculate the core CPI in addition to the full CPI; they are just two different aggregates drawn from the same base data. The full CPI doesn't exclude “a lion share of basic living necessities” (it excludes taxes unrelated to consumer goods purchases, and that's about it.) [1] [0] in principal, because of high short-term volatility of those components. [1] https://stats.bls.gov/cpi/cpifaq.htm#Question_13 https://stats.bls.gov/cpi/cpifaq.htm#Question_13
    - baybal2 9y ago
      >Now, policy makers and media often highlight, and some programs are based on, the “core” CPI which excludes food and energy [0], rather than the full CPI Well, yes. This is how it is The point where the dodgy part is for example how they do weighting for things like housing rents, their criteria of non-comparable replacements, idea of product classes (an apple is not an inferior version of an apple; a car is a car invariably of it being considered luxury car or not) and so on. The CPI dynamic has real trouble reflecting real consumer spendings.

deleted 9y ago

[deleted]

notacoward 9y ago

> Inflation (mostly ZIRP driven) has been very high Totally untrue. In 2013-2016 inflation was lower than at any time in the last half century. 2017 has been a bit higher, but still lower than all of 1967-1996. Sure, you can cherry-pick a particular commodity in a particular market to make it seem otherwise, but momentary or local fluctuations in supply and demand aren't really inflation. Inflation is a systemic phenomenon, and it's actually at historic lows. The fact that some people make life choices that subject them to rising costs doesn't really have anything to do with inflation. http://www.usinflationcalculator.com/inflation/historical-inflation-rates/ http://www.usinflationcalculator.com/inflation/historical-in...

lotsofpulp 9y ago
Whatever inflation is being measured should be linked to the choices people are making, otherwise what is the point of measuring it? You need to get higher education, at least bachelors if not masters level, in order to secure a decent income. The cost of this higher education increases at a ridiculous rate, and it's one of the biggest purchases a young person makes. Then you need to live near a city, the bigger the better. That's where all the jobs are and since work is much more fluid, you need to be where there are many employers. Also, you the advantages of networking capabilities in cities will give you a shot at going big. Living costs near large cities have also increased at a rapid pace, whether it be a home or rental. If you're going to have kids, you want them in the best schools, so you pay high property taxes or pay for private school. Best thing you can do to increase the odds of financial success for your kids is to make sure they go to school with other rich kids and have an wealthy network. Then you get start getting sick and need medical care. This is also one of life's huge, unavoidable expenses. There is absolutely no way inflation is low for you if you depend on certain medicines, just read the headlines, the price could skyrocket anytime if the patent holder chooses to.
- paulddraper 9y ago
  > need > need > need I think we are confusing needs with wants. All good things, but all choices, not requirements.
  - lotsofpulp 9y ago
    The data I have seen shows a considerable earnings and wealth gap for those who did make those choices versus those who didn't. No one needs anything other than a cave in the woods with some squirrel meat every now and then, but assuming you are like most people and want to land an attractive mate and secure heat and air conditioning and a future for your children, then you probably want to place your bets accordingly.
    - notacoward 9y ago
      > earnings and wealth gap But does that translate into a quality of life gap? It might not, and needing more earnings/wealth to pay for the same quality of life doesn't make it a rational choice.
deleted 9y ago
[deleted]
richardknop 9y ago
Inflation measure (CPI) doesn't include real estate (and stocks etc), a single biggest cost young people will have to face in life. Unless they want to rent forever (and rent prices are not included in the official inflation rate either as social housing is over represented). So I can't take such inflation reporting seriously as that's a major omission. And young people are the most affected by this shady way of calculating inflation as they are the ones that need to buy real estate to get on the property ladder. >>> The fact that some people make life choices that subject them to rising costs doesn't really have anything to do with inflation. Buying a house is not a life choice. It's a necessity.
- notacoward 9y ago
  > Buying a house is not a life choice. It's a necessity Buying a house in a place where real estate will be your single biggest cost is indeed a choice. The way inflation is calculated might not be perfect, but let's not try to make it even more imperfect in a different way. EDIT: also, even with housing factored in, inflation is still low. http://cepr.net/data-bytes/prices-bytes/prices-2017-06 http://cepr.net/data-bytes/prices-bytes/prices-2017-06
  - richardknop 9y ago
    Well couple percentage points make a huge difference cumulatively. 2-3% over 10 years adds up quickly. I don't agree with your opinion though. If you are career oriented and want to be successful you will be drawn to big cities as that's where the best jobs are and where you can get ahead a lot. And real estate is very expensive there. I do think in rural areas it's also your biggest life expense as incomes are lower there. So it's the biggest cost item irrespective of where you live.
    - notacoward 9y ago
      > 2-3% over 10 years adds up quickly. So do those 10-50% raises over ten years. > If you are career oriented and want to be successful you will be drawn to big cities as that's where the best jobs are and where you can get ahead a lot. There's a grain of truth here. I'm able to work remotely, and just in the past month I've worked from a variety of different kinds of environments in four states. However, that's because I've built a skillset and a track record by working in close proximity with others at a bunch of startups plus a couple of larger companies. I understand that not everybody has that option. However, even within a big city you have a choice of where to live. The crappiest place I ever lived was right in the heart of a big city. I've lived in crummy places, tiny places, places with awful commutes, places with multiple roommates to defray the cost. Those were my choices. You might make different choices, but they are still choices. People who make far less money than we do can still find places to live where they can come in every day to clean our offices, cook our lunches, teach our children. If they can, so can we. It's amazing what you can do if you don't enter the rat race of who has the biggest house, takes the best vacations, knows the best restaurants. There will be time for that, after you've built your base. The first few years after college are still part of the foundation-laying stage. You shouldn't expect to be better off materially, and often you'll be worse off for a while. That's life. At least it's not a permanent condition for those of us in tech, like it is for so many others.
baybal2 9y ago
The official inflation numbers in US are calculated in a rather dodgy way. You should read about that. Government statisticians take a very big effort to exclude a lion share of basic living necessities out of CPI calculation
- dragonwriter 9y ago
  > Government statisticians take a very big effort to exclude a lion share of basic living necessities out of CPI calculation No, they don't. Now, policy makers and media often highlight, and some programs are based on, the “core” CPI which excludes food and energy [0], rather than the full CPI, but since the data is collected by sector anyway, it's virtually zero additional effort to calculate the core CPI in addition to the full CPI; they are just two different aggregates drawn from the same base data. The full CPI doesn't exclude “a lion share of basic living necessities” (it excludes taxes unrelated to consumer goods purchases, and that's about it.) [1] [0] in principal, because of high short-term volatility of those components. [1] https://stats.bls.gov/cpi/cpifaq.htm#Question_13 https://stats.bls.gov/cpi/cpifaq.htm#Question_13
  - baybal2 9y ago
    >Now, policy makers and media often highlight, and some programs are based on, the “core” CPI which excludes food and energy [0], rather than the full CPI Well, yes. This is how it is The point where the dodgy part is for example how they do weighting for things like housing rents, their criteria of non-comparable replacements, idea of product classes (an apple is not an inferior version of an apple; a car is a car invariably of it being considered luxury car or not) and so on. The CPI dynamic has real trouble reflecting real consumer spendings.