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For one, that is exactly the case. An overwhelming majority of people in America are in debt, and have no savings. (In the case this isn't obvious: if you have

For one, that is exactly the case. An overwhelming majority of people in America are in debt, and have no savings. (In the case this isn't obvious: if you have no savings, you have no choice of where to invest your savings.)

hueving 8y ago
Everyone in the middle class who has no savings has chosen to invest in something else: instant gratification of cell phones, TVs, expensive cars, large houses, etc.
- dlp211 8y ago
  The middle class pays more for needs and less for wants then it did 40, 50, 60 years ago.
  - ghostbrainalpha 8y ago
    Take a look at the chart in this article from HumanProgress.Org https://humanprogress.org/article.php?p=597 https://humanprogress.org/article.php?p=597 Your statement is only true if you move a significant number of items like "Dishwasher" from want to need. Clothing, Food, Appliances are all now significantly cheaper comparability. Housing is a serious issue that has not followed the progress made in other areas, but there is hope for the future even in that area.
    - prolikewh0a 8y ago
      Prices of wants has significantly decreased, while needs have increased. [0] https://www.abi.org/newsroom/chart-of-the-day/price-changes-for-select-us-consumer-goods-and-services-and-wages https://www.abi.org/newsroom/chart-of-the-day/price-changes-...
    - dredmorbius 8y ago
      Know your source: HumanProgress.org is a project of the Cato Institute with major support from the John Templeton Foundation and the Searle Freedom Trust, as well as additional funding from the Brinson Foundation and the Dian Graves Owen Foundation. https://humanprogress.org/about https://humanprogress.org/about I suspected as much. https://www.sourcewatch.org/index.php/Cato_Institute https://www.sourcewatch.org/index.php/Cato_Institute https://www.sourcewatch.org/index.php/John_Templeton_Foundation https://www.sourcewatch.org/index.php/John_Templeton_Foundat... https://www.sourcewatch.org/index.php/Searle_Freedom_Trust https://www.sourcewatch.org/index.php/Searle_Freedom_Trust https://en.m.wikipedia.org/wiki/Gary_P._Brinson https://en.m.wikipedia.org/wiki/Gary_P._Brinson DGOF are dark money with virtually no footprint: http://dian-graves-owen-foundation.idilogic.aidpage.com http://dian-graves-owen-foundation.idilogic.aidpage.com
      - ghostbrainalpha 8y ago
        I understand we all want to be wary about our sources, but a lot of what HumanProgress puts out is fairly simple and focused on the numbers. If you say this is how much a loaf of bread cost in 1965, and this is how much the average McDonalds worker was paid in 1965... then you do the same analysis for 2018, I think you have a interesting statement that could be shielded from politics. Obviously if you are making bigger statements about quality of life, what is a WANT, and what is a NEED, then things get complicated and bias comes in.
        dredmorbius 8y ago
        The article starts out with multiple ideological and highly cherry-picking claims. That's what sent me looking for information on the source. It conflates mean measures of GDP with the far more valid median, or better, the quality of life of the least among us, the standard chosen by such eminant socialists as Adam Smith and John Stuart Mill. Its gadget-based definitions of wealth fly in the face of fundamental necessities: food, water, shelter, medicine. Again you'll find this argument dismissed in Smith. I've taken my own whack at it, Maslow's smartphone: https://old.reddit.com/r/dredmorbius/comments/2vwfb6/maslows_smartphone_the_role_of_technology_in/ https://old.reddit.com/r/dredmorbius/comments/2vwfb6/maslows... See also Maslow's swimming pool: Yes, we've got a swimming pool. But that won't feed my children." The BBC's Malcolm Brabant, quoting a doctor's wife in "The Human Toll of Greek Austerity", describing the impacts of Greece's austerity measures.... https://old.reddit.com/r/dredmorbius/comments/3ey7d1/maslows_swimming_pool_greek_austerity/ https://old.reddit.com/r/dredmorbius/comments/3ey7d1/maslows... The most illuminating recasting of wealth and poverty I've seen in decades comes from a non-economist, Yonatan Zunger, who proposes the financial-shock wealth test: What is the largest unexpected financial shock you could sustain without the cost of that to you suddenly becoming ten times the original cost or more? That number isn’t something easy to calculate; it depends on whether you have a family that can help you out, on your income, on whether that shock involves losing your job (and thus your health insurance, if you live in the US), on whether you have access to any other sources of security (including public assistance). https://shift.newco.co/your-financial-shock-wealth-4845e6dc1d2f https://shift.newco.co/your-financial-shock-wealth-4845e6dc1... The other side of this connects to the financial instability of income. How variable is same, and to what extent does expected perturbation of income (job loss, illness, shorted wages, etc.) put a household in threat of eviction, foreclosure, etc. None of which are addressed by your source. Its framing of the question is such that its response isn't even wrong. It's utterly irrelevant.
  - dredmorbius 8y ago
    Criticism to the response below notwithstanding, do you have a source or sources?
- extralego 8y ago
  Appalling nonsense. This is a straw man, and obviously not based on any reputable evidence.
  - nostrademons 8y ago
    The evidence for it is that there are people poorer than middle-class, with no access to capital or loans, and they manage to survive. If somebody middle-class or above wants to get out of debt or accumulate savings, all they have to do is live like someone who's poor while continuing to earn like somebody who's middle-class, and bank the difference. While I think the OP's point was a bit of an oversimplification, for the vast, vast majority of people this strategy actually does work. If you live like you're poor but earn like you're middle class, you will get out of debt. The people who remain in debt - again, assuming a middle class or higher salary - are those whose self-image requires a lifestyle where they can tell themselves they're not poor.
    - deleted 8y ago
      [deleted]
    - prolikewh0a 8y ago
      Richest country in the world, people need to live as if they're poor to pay back the $6000 of debt they have from needing stitches and an x-ray at the hospital. Do you understand what you're saying?
      - hueving 8y ago
        Middle class usually has healthcare of some sort. I don't think you understand what you're talking about. To be clear, I completely agree that there is a class of people in the US that lives like that, but it's not the middle that is bringing in $70-80k a household from jobs with benefits.
        prolikewh0a 8y ago
        Sure, I have health insurance and work Corporate IT for a Fortune 500. I'm lower middle class. Lets run through the numbers here. I pay $140/month for insurance, have a $1500 deductible, $500 ER visit, and $3000 maximum out of pocket. A hospital trip for me could cost $5000, which would absolutely devastate me even though I have no debt, and have some savings. This is standard for friends who work at other companies with similar jobs, too, including in other states. The middle class does not have healthcare, they have essentially 'Catastrophic' coverage and an illusion that they are covered for anything else.
- mikec3010 8y ago
  What's wrong with running a negative balance sheet? Companies do it all the time. If the ship sinks, you file bankruptcy, wash your hands and try again.
  - hueving 8y ago
    You can't retire. It's okay for companies because when they run out of money they just die.

hueving 8y ago

Everyone in the middle class who has no savings has chosen to invest in something else: instant gratification of cell phones, TVs, expensive cars, large houses, etc.

dlp211 8y ago
The middle class pays more for needs and less for wants then it did 40, 50, 60 years ago.
- ghostbrainalpha 8y ago
  Take a look at the chart in this article from HumanProgress.Org https://humanprogress.org/article.php?p=597 https://humanprogress.org/article.php?p=597 Your statement is only true if you move a significant number of items like "Dishwasher" from want to need. Clothing, Food, Appliances are all now significantly cheaper comparability. Housing is a serious issue that has not followed the progress made in other areas, but there is hope for the future even in that area.
  - prolikewh0a 8y ago
    Prices of wants has significantly decreased, while needs have increased. [0] https://www.abi.org/newsroom/chart-of-the-day/price-changes-for-select-us-consumer-goods-and-services-and-wages https://www.abi.org/newsroom/chart-of-the-day/price-changes-...
  - dredmorbius 8y ago
    Know your source: HumanProgress.org is a project of the Cato Institute with major support from the John Templeton Foundation and the Searle Freedom Trust, as well as additional funding from the Brinson Foundation and the Dian Graves Owen Foundation. https://humanprogress.org/about https://humanprogress.org/about I suspected as much. https://www.sourcewatch.org/index.php/Cato_Institute https://www.sourcewatch.org/index.php/Cato_Institute https://www.sourcewatch.org/index.php/John_Templeton_Foundation https://www.sourcewatch.org/index.php/John_Templeton_Foundat... https://www.sourcewatch.org/index.php/Searle_Freedom_Trust https://www.sourcewatch.org/index.php/Searle_Freedom_Trust https://en.m.wikipedia.org/wiki/Gary_P._Brinson https://en.m.wikipedia.org/wiki/Gary_P._Brinson DGOF are dark money with virtually no footprint: http://dian-graves-owen-foundation.idilogic.aidpage.com http://dian-graves-owen-foundation.idilogic.aidpage.com
    - ghostbrainalpha 8y ago
      I understand we all want to be wary about our sources, but a lot of what HumanProgress puts out is fairly simple and focused on the numbers. If you say this is how much a loaf of bread cost in 1965, and this is how much the average McDonalds worker was paid in 1965... then you do the same analysis for 2018, I think you have a interesting statement that could be shielded from politics. Obviously if you are making bigger statements about quality of life, what is a WANT, and what is a NEED, then things get complicated and bias comes in.
      - dredmorbius 8y ago
        The article starts out with multiple ideological and highly cherry-picking claims. That's what sent me looking for information on the source. It conflates mean measures of GDP with the far more valid median, or better, the quality of life of the least among us, the standard chosen by such eminant socialists as Adam Smith and John Stuart Mill. Its gadget-based definitions of wealth fly in the face of fundamental necessities: food, water, shelter, medicine. Again you'll find this argument dismissed in Smith. I've taken my own whack at it, Maslow's smartphone: https://old.reddit.com/r/dredmorbius/comments/2vwfb6/maslows_smartphone_the_role_of_technology_in/ https://old.reddit.com/r/dredmorbius/comments/2vwfb6/maslows... See also Maslow's swimming pool: Yes, we've got a swimming pool. But that won't feed my children." The BBC's Malcolm Brabant, quoting a doctor's wife in "The Human Toll of Greek Austerity", describing the impacts of Greece's austerity measures.... https://old.reddit.com/r/dredmorbius/comments/3ey7d1/maslows_swimming_pool_greek_austerity/ https://old.reddit.com/r/dredmorbius/comments/3ey7d1/maslows... The most illuminating recasting of wealth and poverty I've seen in decades comes from a non-economist, Yonatan Zunger, who proposes the financial-shock wealth test: What is the largest unexpected financial shock you could sustain without the cost of that to you suddenly becoming ten times the original cost or more? That number isn’t something easy to calculate; it depends on whether you have a family that can help you out, on your income, on whether that shock involves losing your job (and thus your health insurance, if you live in the US), on whether you have access to any other sources of security (including public assistance). https://shift.newco.co/your-financial-shock-wealth-4845e6dc1d2f https://shift.newco.co/your-financial-shock-wealth-4845e6dc1... The other side of this connects to the financial instability of income. How variable is same, and to what extent does expected perturbation of income (job loss, illness, shorted wages, etc.) put a household in threat of eviction, foreclosure, etc. None of which are addressed by your source. Its framing of the question is such that its response isn't even wrong. It's utterly irrelevant.
- dredmorbius 8y ago
  Criticism to the response below notwithstanding, do you have a source or sources?
extralego 8y ago
Appalling nonsense. This is a straw man, and obviously not based on any reputable evidence.
- nostrademons 8y ago
  The evidence for it is that there are people poorer than middle-class, with no access to capital or loans, and they manage to survive. If somebody middle-class or above wants to get out of debt or accumulate savings, all they have to do is live like someone who's poor while continuing to earn like somebody who's middle-class, and bank the difference. While I think the OP's point was a bit of an oversimplification, for the vast, vast majority of people this strategy actually does work. If you live like you're poor but earn like you're middle class, you will get out of debt. The people who remain in debt - again, assuming a middle class or higher salary - are those whose self-image requires a lifestyle where they can tell themselves they're not poor.
  - deleted 8y ago
    [deleted]
  - prolikewh0a 8y ago
    Richest country in the world, people need to live as if they're poor to pay back the $6000 of debt they have from needing stitches and an x-ray at the hospital. Do you understand what you're saying?
    - hueving 8y ago
      Middle class usually has healthcare of some sort. I don't think you understand what you're talking about. To be clear, I completely agree that there is a class of people in the US that lives like that, but it's not the middle that is bringing in $70-80k a household from jobs with benefits.
      - prolikewh0a 8y ago
        Sure, I have health insurance and work Corporate IT for a Fortune 500. I'm lower middle class. Lets run through the numbers here. I pay $140/month for insurance, have a $1500 deductible, $500 ER visit, and $3000 maximum out of pocket. A hospital trip for me could cost $5000, which would absolutely devastate me even though I have no debt, and have some savings. This is standard for friends who work at other companies with similar jobs, too, including in other states. The middle class does not have healthcare, they have essentially 'Catastrophic' coverage and an illusion that they are covered for anything else.
mikec3010 8y ago
What's wrong with running a negative balance sheet? Companies do it all the time. If the ship sinks, you file bankruptcy, wash your hands and try again.
- hueving 8y ago
  You can't retire. It's okay for companies because when they run out of money they just die.