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I’m a millennial so I’m sympathetic but this is something I’ve heard a lot about anecdotally without a lot of data behind it. Here are two more anecdotes: My d

I’m a millennial so I’m sympathetic but this is something I’ve heard a lot about anecdotally without a lot of data behind it. Here are two more anecdotes: My dad graduated in 1976 in the middle of stagflation and had a 12% apr on his first house in the mid 80s. His dad graduated into the recession that stretched between ww2 and Korea. I think we’re too quick to look at generations that have accumulated wealth and accuse them of having always had it easy.

whamlastxmas 8y ago
The rate was 12% but you completely ignore the average home price and its relation to average income. Housing was tremendously less expensive (even after interest), largely in part to the higher rate.
- hndamien 8y ago
  High rates result in lower prices. Low rates result in higher prices. The rate on its own is really pretty irrelevant.
  - astura 8y ago
    Exactly. Most home buyers take out a mortgage. Most people also look at monthly payments as a proxy for affordability. Monthly payments raise when interest rates rise. Therefore, sellers need to ask for lower prices when rates are high in order to attract buyers. A $150,000 mortgage at 12% interest has monthly payments of $1,543, at 5% interest its $805.
dnadler 8y ago
> My dad graduated in 1976 in the middle of stagflation and had a 12% apr on his first house in the mid 80s. But inflation over the next few years meant that in real terms (the most important terms), that rate was between 6% and -2%(!). Inflation hit 14% in 1980. The ability to refinance also means that he wouldn't have to keep that high interest rate once inflation settled down. So he probably did quite well with that mortgage. edit: I misread the dates in that sentence, so your Dad probably didn't benefit from the inflation in the early 80s. That said, it is important to consider high mortgage rates in real terms.
x220 8y ago
>the recession that stretched between ww2 and Korea I really don't buy that baby boomers had a tough time. I believe that white men in that time in America had perhaps the most prosperous economy and job opportunities in world history.
- jriot 8y ago
  You are looking at history through rose colored glasses.
  - x220 8y ago
    Statistics show that in real terms Baby Boomers had it better than any other generation I know of. It's not just an impression. They made huge money in real terms, which is especially amazing given that most of them were not highly educated.
- cbm-vic-20 8y ago
  * except for the ones that were drafted, shipped out to SE Asia and sent home in a box. Or with lifelong physical or mental injuries.
  - dcole2929 8y ago
    I don't see your point here. 1,789,000 is the total number of US troops serving in the Theatre during the Korean War. There were 74 million males living in the US ~50 million of which were over the age of 18. Even if every single soldier died, which didn't happen, I think we can safely say the booming economy in which these people lived worked out pretty well for the majority. https://www.cdc.gov/nchs/data/hus/2010/001.pdf https://www.cdc.gov/nchs/data/hus/2010/001.pdf https://www.va.gov/opa/publications/factsheets/fs_americas_wars.pdf https://www.va.gov/opa/publications/factsheets/fs_americas_w...
    - encoderer 8y ago
      Yes, a globalized leviathan murder machine is good for business. But: - horrible recession between ww2 and Korean War. - young men faced the draft. A bit of a drag really. - everybody felt the horrors of war and knowing personal loss. - the jobs that you speak so fondly of had awful workplace safety, horrible pollution problems, and generally poor working conditions compared to today. Also there are a lot of things that are a lot cheaper today as a percentage of income, like food, clothing and durable goods.

whamlastxmas 8y ago

The rate was 12% but you completely ignore the average home price and its relation to average income. Housing was tremendously less expensive (even after interest), largely in part to the higher rate.

hndamien 8y ago
High rates result in lower prices. Low rates result in higher prices. The rate on its own is really pretty irrelevant.
- astura 8y ago
  Exactly. Most home buyers take out a mortgage. Most people also look at monthly payments as a proxy for affordability. Monthly payments raise when interest rates rise. Therefore, sellers need to ask for lower prices when rates are high in order to attract buyers. A $150,000 mortgage at 12% interest has monthly payments of $1,543, at 5% interest its $805.

dnadler 8y ago

> My dad graduated in 1976 in the middle of stagflation and had a 12% apr on his first house in the mid 80s. But inflation over the next few years meant that in real terms (the most important terms), that rate was between 6% and -2%(!). Inflation hit 14% in 1980. The ability to refinance also means that he wouldn't have to keep that high interest rate once inflation settled down. So he probably did quite well with that mortgage. edit: I misread the dates in that sentence, so your Dad probably didn't benefit from the inflation in the early 80s. That said, it is important to consider high mortgage rates in real terms.

x220 8y ago

>the recession that stretched between ww2 and Korea I really don't buy that baby boomers had a tough time. I believe that white men in that time in America had perhaps the most prosperous economy and job opportunities in world history.

jriot 8y ago
You are looking at history through rose colored glasses.
- x220 8y ago
  Statistics show that in real terms Baby Boomers had it better than any other generation I know of. It's not just an impression. They made huge money in real terms, which is especially amazing given that most of them were not highly educated.
cbm-vic-20 8y ago
* except for the ones that were drafted, shipped out to SE Asia and sent home in a box. Or with lifelong physical or mental injuries.
- dcole2929 8y ago
  I don't see your point here. 1,789,000 is the total number of US troops serving in the Theatre during the Korean War. There were 74 million males living in the US ~50 million of which were over the age of 18. Even if every single soldier died, which didn't happen, I think we can safely say the booming economy in which these people lived worked out pretty well for the majority. https://www.cdc.gov/nchs/data/hus/2010/001.pdf https://www.cdc.gov/nchs/data/hus/2010/001.pdf https://www.va.gov/opa/publications/factsheets/fs_americas_wars.pdf https://www.va.gov/opa/publications/factsheets/fs_americas_w...
  - encoderer 8y ago
    Yes, a globalized leviathan murder machine is good for business. But: - horrible recession between ww2 and Korean War. - young men faced the draft. A bit of a drag really. - everybody felt the horrors of war and knowing personal loss. - the jobs that you speak so fondly of had awful workplace safety, horrible pollution problems, and generally poor working conditions compared to today. Also there are a lot of things that are a lot cheaper today as a percentage of income, like food, clothing and durable goods.