11 ms·

Current Inflation Has Different Effects on Different Age Groups

82 points by betahiker 8y ago

ojbyrne 8y ago
"Over the past five years" - I feel that in order to formulate "a historical price index per generation" you need to look at inflation over the entire life of the generation. Baby boomers went through the seventies, when inflation was significantly higher than now.
- refurb 8y ago
  I was coming here to say that. Inflation rates in the double digits is something millennials have never gone through.
  - A2017U1 8y ago
    My parents "suffered" through 14% interest rates, wages were rising at breakneck speeds and their mortgage was largely inflated away before they even paid any of it off. By historical standards it was actually a great time, a single wage family could afford their own house. Such similar circumstances is impossible today in the same city.
    - refurb 8y ago
      There is a reason they called it stagflation. It wasn’t a good time at all in the US.
j-c-hewitt 8y ago
This is a great example of how you can make up anything by aggregating unrelated statistical measures and then mislead people with a new definition on top of another woozy commonly used definition.
- smallnamespace 8y ago
  We can certainly argue the technical merits of how they created their 'generation-weighted price index', but differential impacts of inflation seems plausible on the face of it. If you are looking for work in a big city, and big city real estate prices are growing much faster than nationwide, that is a real effect.
  - j-c-hewitt 8y ago
    Well... sort of, but why call it 'inflation'? That certain age groups tended to act in certain ways and were impacted by differences in price trends in different ways -- that's accurate. What's misleading or confusing is to then redefining the already-muddled term of 'inflation' from an absolute index to multiple indices and then trying to say that because Index B went up more than Index A that some group of people were much more impacted by Index B than another people were by Index A. The Fed has a price index that most entities in the US use to measure what it calls inflation. There are plenty of arguments out there that go into detail about how that index can be misleading and how certain institutional prerogatives encourage the people who maintain that index to keep it misleading (e.g. many entities are obligated to increase salaries and pension payouts tied to the CPI).
    - ghaff 8y ago
      That's a good way of putting it. The various market baskets that make up the various inflation measures contain goods that will matter to some people more than others. And some of the big ticket items will disproportionately affect certain groups. Want to live in a high-cost urban area and don't already own a home? Of course, rising housing prices will affect you more than someone who already owns in one of those areas or lives somewhere else. Are pre-college? Education costs more relatively than it used to? But, yeah, I don't think inflation measures ever claimed to be equably applicable to everyone, especially those measures that excluded some of the major costs precisely because they affect different groups.
    - smallnamespace 8y ago
      > why call it 'inflation' Sibling comment also asks this question, so I'll just respond here: inflation measures the purchasing power of some nominal currency, but that measurement is always relative to a basket of goods. CPI is a basket of 'typical' consumer goods that an average person might buy. But if you're not the average consumer, then in what sense is CPI relevant to you, rather than to a macroeconomist? I agree that there's a risk of confusion, but I think the confusion is inherent in what we're trying to measure (I have some dollars, how much stuff [that I care about] can I buy with them?), and not mainly a function of terminological confusion. You could imagine a service like Mint that has all your spending data and calculating your own 'personal CPI', privacy considerations notwithstanding.
aphextron 8y ago
I feel like technology has led to such an efficient form of capitalism over the past 20 years, that there's no room left for any possibility of social mobility. It's this system where there is just enough room for you to live and get by, but never get ahead. Prices for everything are so efficiently optimized at this point that there is no more "wiggle room" for a working person to build wealth. The basic necessities of life have risen to perfectly match your income. It's a new kind of slavery. As a single male with no family or debt, making 3x the median wage, I am just barely doing ok. I literally can't even imagine how other people are still surviving.
- joefourier 8y ago
  Where do you live, and what on earth are you spending your money on? Housing may be absurdly costly in many cities but $5.5k a month after tax (assuming you're American) is enough to do much better than "barely ok" almost anywhere. Are you significantly in debt or living above your means?
  - aphextron 8y ago
    >Where do you live, and what on earth are you spending your money on? Bay area ~$5,000 net monthly $2500 Rent/PGE $1000 Car/Insurance/Gas/Parking/Phone/Internet $500 Food/Clothing $500 IRA That leaves ~$500 monthly discretionary income, which I usually try to save as much as possible but inevitably gets eaten up by all the stupid little things in life that cost too much nowadays. I can't even imagine supporting a family on this income and it is far higher than most people will ever see.
    - WalterBright 8y ago
      I don't think the bay area housing situation is at all representative of capitalism.
    - jerf 8y ago
      That is definitely a localized phenomenon. I don't live in the Valley and my expenses are generally lower than that. (Or at least they are if I translate my expenses into single life. Though my "rent"/mortgage is just straight-up lower than that and you'd probably cry to see what I get for it.) I tend to agree with you. In your position, you need to really want to live in SV for it to be worth it; you're paying a huge premium for the benefit of paying that huge premium.
taurath 8y ago
I wonder how much higher it would be if medical costs were taken out. Housing is the biggest problem for my generation, but it gets almost no traction nor solution.
- 3pt14159 8y ago
  Housing is largely a problem to do with interest rates and mortgages inflating the land. The actual construction materials themselves (at least here in Canada) aren't too bad. I keep wondering why someone doesn't kickstarter a town. It has all the right incentives. Make guidelines that enforce density in the core and do common sense things from day 1, like wire fibre to every domicile.
  - drcode 8y ago
    Don't forget about zoning issues hampering supply and the rising cost of construction labor.
    - jakelarkin 8y ago
      construction labor is seemingly entering a vicious cycle where workers can't afford to live near where the most new homes are needed.
  - pavel_lishin 8y ago
    Like Galt's Gulch?
  - majormajor 8y ago
    There are already quite a few cheap places people could move to. But the demand is increasingly geographically concentrated, instead.
    - throwaway2048 8y ago
      there are few jobs or opportunities in cheap places, its not like everyone lives in large cities because they are unwilling to entertain alternatives.
peter303 8y ago
Medical care, especially drugs, greatly increasing in price for old. 2/3rds of over 65 have at least one cintinuing prescription.
- pkaye 8y ago
  Not all prescriptions are for expensive medicines. I'd say many of them are generic drugs which cost pennies per day.
  - organsnyder 8y ago
    In many cases, drug companies come up with ways to keep prices high. For instance, asthma drugs are reconfigured with different delivery mechanisms that allow them to get new patents for what are essentially long-ago-discovered drugs. For instance, the CFC ban in 2008 caused generic albuterol to go off the market: https://www.scientificamerican.com/article/unlikely-victims-of-banning-cfcs/ https://www.scientificamerican.com/article/unlikely-victims-...
    - pkaye 8y ago
      Other than the CFC ban, in most of those cases, the old medicine is still fine to use.
    - drunken-serval 8y ago
      I can't use albuterol due to side-effects. The CFC ban caused the medication I used to disappear completely. The alternative is half as effective.
    - scarface74 8y ago
      The work around I used when my asthma was worse to save money waa to use a nebulizer. The albuterol tubes were cheap.
    - nimish 8y ago
      > Although the FDA advisory committee recognized that the expenses would go up, Hendeles says, it also believed that the companies would help defray the added costs for individuals. If that's the naïveté of the officials who police the health industry, I'm not surprised that healthcare costs have exploded. Why bother competing when you can have your competition ruled illegal and the ensuing oligopoly allowed with a pinky-swear to not fuck over patients?
WhompingWindows 8y ago
This strikes me as lazy data science and full of overreaching conclusions, because nowhere is uncertainty/spread/variance discussed. What are the errors/variance on these estimations for each year and each spending category? Are these inflation differences statistically significantly different? Comparing 7% vs 8% is already cutting it close without even knowing this crucial information. The headline vastly oversteps the analysis itself, there is simply not enough information presented to make these conclusions. This is one reason why peer-review is essential. This author can throw out a claim like millenials get inflation 14% worse than everyone else, failing to mention it's a difference of 1% over 7-8%, and moreover he did not even look at variance or statistical significance. This would not pass muster in a statistics 101 course, never mind a reputable journal.
- betahiker 8y ago
  > nowhere is uncertainty/spread/variance discussed This is the standard for reporting on inflation data. Do you know of a reporting on inflation where they mention an uncertainty measure? For example when reporting on the difference between this year and last year's inflation number? > failing to mention it's a difference of 1% over 7-8% Quoting from the article: > Over the past five years, millennials have seen their goods become 8.7% more expensive, Generation X 8%, and baby boomers 7.6%.
- repiret 8y ago
  In general I agree that more reporting should include measures of uncertainty. But I also think there are cases when talking about inflation where uncertainty measures are inappropriate. You can have uncertainty in the average price of avocados, or in the number of avocados that millennials consume on average. But those aren't very holistic views of inflation. If I define my holistic measure of inflation to be the CPI, then there's no margin of error. Its just a number that the Bureau of Labor Statistics publishes every month. I can say, for example, that the CPI for June 2009 was exactly 215.693. Or that the CPI increased by 1.47%, exact to the nearest 0.01%, between March 2012 and 2013. On the other hand, if you want to ask whether the CPI is any good as a measure of inflation, then in general inflation isn't precisely enough defined to talk about that with a simple margin of error. There is no exact definition of inflation that we're trying to approximate, so we can't say things like "we're 95% confident that the actual inflation value was between 1.4% and 1.5%".
olfactory 8y ago
Official inflation numbers are based on a basket of goods that are thought to be representative for the purpose of broad economic policy. But it's certainly true that inflation is not the same for all goods or for the basket that is highly relevant to one person or to one firm or industry. So like any economic policy it has winners and losers. Just because the policy may be reasonable does not mean that the winners and losers are irrelevant. During the startup boom many developers saw their wages inflating rapidly in spite of little skill growth. Some also saw their rent increasing if they lived in the bay area. Landlords in the bay area saw their income increasing, and firms hiring developers in the bay area saw the cost associated with wages inflate rapidly. The mistake this article makes is that it puts all its eggs into the young vs old theme when really this is a fairly obvious consequence of a dynamic economy.
maerF0x0 8y ago
The government has all kinds of built in incentives for inflation to be reported as low, whilst simultaneously being high. This kinda points at the ideas, though I don't actually agree with all the content: https://dailyreckoning.com/revealing-real-rate-inflation-crash-system/ https://dailyreckoning.com/revealing-real-rate-inflation-cra...
araes 8y ago
The claim of a difference is 'slightly' exaggerated (~1%) However, the overall inflation data is quite interesting. - Best tracker of inflation - drinking - Most inflated - Learning and having a roof over your head - Least inflated - Changing location and playing dress-up (you or your home) As always, rent seeking behavior is an issue (or a good investment area). Getting smarter is getting more difficult (or at least more costly) and unfortunately compounds. If you are already educated and ahead, you don't have to pay those costs, and you have a higher vantage point from which to choose opportunities (like charging other people rent). Not sure if I believe food - or else probably has a huge amount of spread within it. Some food has dramatically risen, others not (tuna - high, bread - low). Noisiness of food line probably reflects this. An unlikely friend in bulk negotiators like Walmart / Kroger / Amazon. "-> Tyson, Coke, Gen. Mills, keep your prices low." Transportation is opportunity. Don't like where you are? Leave. Potential foraging range - up. Go live in India, where food is $4 a day, and rent is $100-200. Course, this helps baby boomers too. Retire in Kathmandu, Tangier, Santiago. Lots of money just goes further.
- wheaties 8y ago
  There's a good article I can't find that shows that the things you need are the things that have risen in cost the most while the things you want have risen the least. Hence, the inflation rating actually tracks only the homes you want a d is becoming disconnected from actual costs of living.
- seanmcdirmid 8y ago
  Unfortunately Medicare is a big deal that prevents boomers from retiring abroad. If you are rich and can afford private healthcare (even according it at a discounted rate in India or Thailand can be tough), then it’s a great idea, but then you don’t really need to.
- asfasgasg 8y ago
  > rent seeking behavior So many people are confused about the meaning of this term lately, to the point where I think we might need to scrap it and come up with a new one. In traditional economics, rent-seeking is a bad thing, because it involves lobbying the government to increase one's revenues without performing any economically beneficial function. This is why the term has a negative connotation. Almost all economists think this type of behavior causes inefficiency. Buying a house and renting it out does not fall under this category. In this case, you are performing a beneficial economic function (i.e. you are providing someone a dwelling, in exchange for money). There are related rent-seeking behaviors, such as lobbying the government to prevent building new housing stock for the purpose of increasing the value of your dwelling and the amount of your rents. But the act of investing itself? Not rent-seeking. Not considered bad by most economists.
PaulHoule 8y ago
Expensive health care is worst for older people (until you hit 65 and qualify for single payer) Expensive education is worst for younger people, unless you are an older person who wants to pay for your children's education. Expensive housing is (mostly) good for the old and bad for the young. If an oldster got settled in Palo Alto back in the 8-bit era, they've paid low taxes since they've never sold their house and will take a stupendous capital gain.
ww520 8y ago
I don't buy this. Medical cost has risen faster in recent years. Older aged boomers surely spend more in medical needs than millennials.
goldenkey 8y ago
This result shouldn't be surprising to anyone who has thought about what the construct of money/debt actually does. Every bubble in the history of finance has always been the overvaluing of one asset in exchange for the devaluing of other assets. By overvaluing houses today, we are screwing over every field that requires property/land, retail stores for example. And renters which are predominantly youth. Now, the overvalued houses don't actually consume value directly - they give money to the people who have these assets or are employed in their use - home owners, property management companies - construction companies - etc etc. Money has always allowed for bias and inequality in resources and work allotted. One sector like housing in exchange for sacrificing other sectors. Or sacrificing one nation/locale's wealth in exchange for another - ie. many 3rd world countries/ exchange rates. Or sacrificing young peoples' prosperity in exchange for old peoples' - inflation / housing / medicare / social security / stock market inflation. Money is a tool for giving value, and hence prosperity, unequally for any kind of sociological category of people by way of empirical categories of valuables. I don't hate capitalism but it is unavoidably discriminatory. The very act of a loan is essentially an exchange of value temporally - why shouldn't the natural consequence be to see money as a way of moving allotted value around both spatially, sociologically, and temporally?
skybrian 8y ago
You could slice up inflation in all sorts of ways: by city, state, homeowner versus renter, how long ago the home owner bought their house, singles versus families, where they want to college (if anywhere), and so on. Remember that inflation is supposed to measure the prices paid by the average person, but most people make some purchases that aren't average.

82 points by betahiker 8y ago

"Over the past five years" - I feel that in order to formulate "a historical price index per generation" you need to look at inflation over the entire life of the generation. Baby boomers went through the seventies, when inflation was significantly higher than now.

refurb 8y ago
I was coming here to say that. Inflation rates in the double digits is something millennials have never gone through.
- A2017U1 8y ago
  My parents "suffered" through 14% interest rates, wages were rising at breakneck speeds and their mortgage was largely inflated away before they even paid any of it off. By historical standards it was actually a great time, a single wage family could afford their own house. Such similar circumstances is impossible today in the same city.
  - refurb 8y ago
    There is a reason they called it stagflation. It wasn’t a good time at all in the US.

j-c-hewitt 8y ago

This is a great example of how you can make up anything by aggregating unrelated statistical measures and then mislead people with a new definition on top of another woozy commonly used definition.

smallnamespace 8y ago
We can certainly argue the technical merits of how they created their 'generation-weighted price index', but differential impacts of inflation seems plausible on the face of it. If you are looking for work in a big city, and big city real estate prices are growing much faster than nationwide, that is a real effect.
- j-c-hewitt 8y ago
  Well... sort of, but why call it 'inflation'? That certain age groups tended to act in certain ways and were impacted by differences in price trends in different ways -- that's accurate. What's misleading or confusing is to then redefining the already-muddled term of 'inflation' from an absolute index to multiple indices and then trying to say that because Index B went up more than Index A that some group of people were much more impacted by Index B than another people were by Index A. The Fed has a price index that most entities in the US use to measure what it calls inflation. There are plenty of arguments out there that go into detail about how that index can be misleading and how certain institutional prerogatives encourage the people who maintain that index to keep it misleading (e.g. many entities are obligated to increase salaries and pension payouts tied to the CPI).
  - ghaff 8y ago
    That's a good way of putting it. The various market baskets that make up the various inflation measures contain goods that will matter to some people more than others. And some of the big ticket items will disproportionately affect certain groups. Want to live in a high-cost urban area and don't already own a home? Of course, rising housing prices will affect you more than someone who already owns in one of those areas or lives somewhere else. Are pre-college? Education costs more relatively than it used to? But, yeah, I don't think inflation measures ever claimed to be equably applicable to everyone, especially those measures that excluded some of the major costs precisely because they affect different groups.
  - smallnamespace 8y ago
    > why call it 'inflation' Sibling comment also asks this question, so I'll just respond here: inflation measures the purchasing power of some nominal currency, but that measurement is always relative to a basket of goods. CPI is a basket of 'typical' consumer goods that an average person might buy. But if you're not the average consumer, then in what sense is CPI relevant to you, rather than to a macroeconomist? I agree that there's a risk of confusion, but I think the confusion is inherent in what we're trying to measure (I have some dollars, how much stuff [that I care about] can I buy with them?), and not mainly a function of terminological confusion. You could imagine a service like Mint that has all your spending data and calculating your own 'personal CPI', privacy considerations notwithstanding.

aphextron 8y ago

I feel like technology has led to such an efficient form of capitalism over the past 20 years, that there's no room left for any possibility of social mobility. It's this system where there is just enough room for you to live and get by, but never get ahead. Prices for everything are so efficiently optimized at this point that there is no more "wiggle room" for a working person to build wealth. The basic necessities of life have risen to perfectly match your income. It's a new kind of slavery. As a single male with no family or debt, making 3x the median wage, I am just barely doing ok. I literally can't even imagine how other people are still surviving.

joefourier 8y ago
Where do you live, and what on earth are you spending your money on? Housing may be absurdly costly in many cities but $5.5k a month after tax (assuming you're American) is enough to do much better than "barely ok" almost anywhere. Are you significantly in debt or living above your means?
- aphextron 8y ago
  >Where do you live, and what on earth are you spending your money on? Bay area ~$5,000 net monthly $2500 Rent/PGE $1000 Car/Insurance/Gas/Parking/Phone/Internet $500 Food/Clothing $500 IRA That leaves ~$500 monthly discretionary income, which I usually try to save as much as possible but inevitably gets eaten up by all the stupid little things in life that cost too much nowadays. I can't even imagine supporting a family on this income and it is far higher than most people will ever see.
  - WalterBright 8y ago
    I don't think the bay area housing situation is at all representative of capitalism.
  - jerf 8y ago
    That is definitely a localized phenomenon. I don't live in the Valley and my expenses are generally lower than that. (Or at least they are if I translate my expenses into single life. Though my "rent"/mortgage is just straight-up lower than that and you'd probably cry to see what I get for it.) I tend to agree with you. In your position, you need to really want to live in SV for it to be worth it; you're paying a huge premium for the benefit of paying that huge premium.

taurath 8y ago

I wonder how much higher it would be if medical costs were taken out. Housing is the biggest problem for my generation, but it gets almost no traction nor solution.

3pt14159 8y ago
Housing is largely a problem to do with interest rates and mortgages inflating the land. The actual construction materials themselves (at least here in Canada) aren't too bad. I keep wondering why someone doesn't kickstarter a town. It has all the right incentives. Make guidelines that enforce density in the core and do common sense things from day 1, like wire fibre to every domicile.
- drcode 8y ago
  Don't forget about zoning issues hampering supply and the rising cost of construction labor.
  - jakelarkin 8y ago
    construction labor is seemingly entering a vicious cycle where workers can't afford to live near where the most new homes are needed.
- pavel_lishin 8y ago
  Like Galt's Gulch?
- majormajor 8y ago
  There are already quite a few cheap places people could move to. But the demand is increasingly geographically concentrated, instead.
  - throwaway2048 8y ago
    there are few jobs or opportunities in cheap places, its not like everyone lives in large cities because they are unwilling to entertain alternatives.

peter303 8y ago

Medical care, especially drugs, greatly increasing in price for old. 2/3rds of over 65 have at least one cintinuing prescription.

pkaye 8y ago
Not all prescriptions are for expensive medicines. I'd say many of them are generic drugs which cost pennies per day.
- organsnyder 8y ago
  In many cases, drug companies come up with ways to keep prices high. For instance, asthma drugs are reconfigured with different delivery mechanisms that allow them to get new patents for what are essentially long-ago-discovered drugs. For instance, the CFC ban in 2008 caused generic albuterol to go off the market: https://www.scientificamerican.com/article/unlikely-victims-of-banning-cfcs/ https://www.scientificamerican.com/article/unlikely-victims-...
  - pkaye 8y ago
    Other than the CFC ban, in most of those cases, the old medicine is still fine to use.
  - drunken-serval 8y ago
    I can't use albuterol due to side-effects. The CFC ban caused the medication I used to disappear completely. The alternative is half as effective.
  - scarface74 8y ago
    The work around I used when my asthma was worse to save money waa to use a nebulizer. The albuterol tubes were cheap.
  - nimish 8y ago
    > Although the FDA advisory committee recognized that the expenses would go up, Hendeles says, it also believed that the companies would help defray the added costs for individuals. If that's the naïveté of the officials who police the health industry, I'm not surprised that healthcare costs have exploded. Why bother competing when you can have your competition ruled illegal and the ensuing oligopoly allowed with a pinky-swear to not fuck over patients?

WhompingWindows 8y ago

This strikes me as lazy data science and full of overreaching conclusions, because nowhere is uncertainty/spread/variance discussed. What are the errors/variance on these estimations for each year and each spending category? Are these inflation differences statistically significantly different? Comparing 7% vs 8% is already cutting it close without even knowing this crucial information. The headline vastly oversteps the analysis itself, there is simply not enough information presented to make these conclusions. This is one reason why peer-review is essential. This author can throw out a claim like millenials get inflation 14% worse than everyone else, failing to mention it's a difference of 1% over 7-8%, and moreover he did not even look at variance or statistical significance. This would not pass muster in a statistics 101 course, never mind a reputable journal.

betahiker 8y ago
> nowhere is uncertainty/spread/variance discussed This is the standard for reporting on inflation data. Do you know of a reporting on inflation where they mention an uncertainty measure? For example when reporting on the difference between this year and last year's inflation number? > failing to mention it's a difference of 1% over 7-8% Quoting from the article: > Over the past five years, millennials have seen their goods become 8.7% more expensive, Generation X 8%, and baby boomers 7.6%.
repiret 8y ago
In general I agree that more reporting should include measures of uncertainty. But I also think there are cases when talking about inflation where uncertainty measures are inappropriate. You can have uncertainty in the average price of avocados, or in the number of avocados that millennials consume on average. But those aren't very holistic views of inflation. If I define my holistic measure of inflation to be the CPI, then there's no margin of error. Its just a number that the Bureau of Labor Statistics publishes every month. I can say, for example, that the CPI for June 2009 was exactly 215.693. Or that the CPI increased by 1.47%, exact to the nearest 0.01%, between March 2012 and 2013. On the other hand, if you want to ask whether the CPI is any good as a measure of inflation, then in general inflation isn't precisely enough defined to talk about that with a simple margin of error. There is no exact definition of inflation that we're trying to approximate, so we can't say things like "we're 95% confident that the actual inflation value was between 1.4% and 1.5%".

olfactory 8y ago

Official inflation numbers are based on a basket of goods that are thought to be representative for the purpose of broad economic policy. But it's certainly true that inflation is not the same for all goods or for the basket that is highly relevant to one person or to one firm or industry. So like any economic policy it has winners and losers. Just because the policy may be reasonable does not mean that the winners and losers are irrelevant. During the startup boom many developers saw their wages inflating rapidly in spite of little skill growth. Some also saw their rent increasing if they lived in the bay area. Landlords in the bay area saw their income increasing, and firms hiring developers in the bay area saw the cost associated with wages inflate rapidly. The mistake this article makes is that it puts all its eggs into the young vs old theme when really this is a fairly obvious consequence of a dynamic economy.

maerF0x0 8y ago

The government has all kinds of built in incentives for inflation to be reported as low, whilst simultaneously being high. This kinda points at the ideas, though I don't actually agree with all the content: https://dailyreckoning.com/revealing-real-rate-inflation-crash-system/ https://dailyreckoning.com/revealing-real-rate-inflation-cra...

araes 8y ago

The claim of a difference is 'slightly' exaggerated (~1%) However, the overall inflation data is quite interesting. - Best tracker of inflation - drinking - Most inflated - Learning and having a roof over your head - Least inflated - Changing location and playing dress-up (you or your home) As always, rent seeking behavior is an issue (or a good investment area). Getting smarter is getting more difficult (or at least more costly) and unfortunately compounds. If you are already educated and ahead, you don't have to pay those costs, and you have a higher vantage point from which to choose opportunities (like charging other people rent). Not sure if I believe food - or else probably has a huge amount of spread within it. Some food has dramatically risen, others not (tuna - high, bread - low). Noisiness of food line probably reflects this. An unlikely friend in bulk negotiators like Walmart / Kroger / Amazon. "-> Tyson, Coke, Gen. Mills, keep your prices low." Transportation is opportunity. Don't like where you are? Leave. Potential foraging range - up. Go live in India, where food is $4 a day, and rent is $100-200. Course, this helps baby boomers too. Retire in Kathmandu, Tangier, Santiago. Lots of money just goes further.

wheaties 8y ago
There's a good article I can't find that shows that the things you need are the things that have risen in cost the most while the things you want have risen the least. Hence, the inflation rating actually tracks only the homes you want a d is becoming disconnected from actual costs of living.
seanmcdirmid 8y ago
Unfortunately Medicare is a big deal that prevents boomers from retiring abroad. If you are rich and can afford private healthcare (even according it at a discounted rate in India or Thailand can be tough), then it’s a great idea, but then you don’t really need to.
asfasgasg 8y ago
> rent seeking behavior So many people are confused about the meaning of this term lately, to the point where I think we might need to scrap it and come up with a new one. In traditional economics, rent-seeking is a bad thing, because it involves lobbying the government to increase one's revenues without performing any economically beneficial function. This is why the term has a negative connotation. Almost all economists think this type of behavior causes inefficiency. Buying a house and renting it out does not fall under this category. In this case, you are performing a beneficial economic function (i.e. you are providing someone a dwelling, in exchange for money). There are related rent-seeking behaviors, such as lobbying the government to prevent building new housing stock for the purpose of increasing the value of your dwelling and the amount of your rents. But the act of investing itself? Not rent-seeking. Not considered bad by most economists.

PaulHoule 8y ago

Expensive health care is worst for older people (until you hit 65 and qualify for single payer) Expensive education is worst for younger people, unless you are an older person who wants to pay for your children's education. Expensive housing is (mostly) good for the old and bad for the young. If an oldster got settled in Palo Alto back in the 8-bit era, they've paid low taxes since they've never sold their house and will take a stupendous capital gain.

ww520 8y ago

I don't buy this. Medical cost has risen faster in recent years. Older aged boomers surely spend more in medical needs than millennials.

goldenkey 8y ago

This result shouldn't be surprising to anyone who has thought about what the construct of money/debt actually does. Every bubble in the history of finance has always been the overvaluing of one asset in exchange for the devaluing of other assets. By overvaluing houses today, we are screwing over every field that requires property/land, retail stores for example. And renters which are predominantly youth. Now, the overvalued houses don't actually consume value directly - they give money to the people who have these assets or are employed in their use - home owners, property management companies - construction companies - etc etc. Money has always allowed for bias and inequality in resources and work allotted. One sector like housing in exchange for sacrificing other sectors. Or sacrificing one nation/locale's wealth in exchange for another - ie. many 3rd world countries/ exchange rates. Or sacrificing young peoples' prosperity in exchange for old peoples' - inflation / housing / medicare / social security / stock market inflation. Money is a tool for giving value, and hence prosperity, unequally for any kind of sociological category of people by way of empirical categories of valuables. I don't hate capitalism but it is unavoidably discriminatory. The very act of a loan is essentially an exchange of value temporally - why shouldn't the natural consequence be to see money as a way of moving allotted value around both spatially, sociologically, and temporally?

skybrian 8y ago

You could slice up inflation in all sorts of ways: by city, state, homeowner versus renter, how long ago the home owner bought their house, singles versus families, where they want to college (if anywhere), and so on. Remember that inflation is supposed to measure the prices paid by the average person, but most people make some purchases that aren't average.