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Isn't this really bad for a capitalistic system? You need people to spend money and buy things that aren't just rent and basic food.

claydavisss 8y ago
No - they are ahering to the first principle of capitalism - take care of yourself!
- prolikewh0a 8y ago
  Ok, but you still need people to buy things. If they're only saving, there's no demand for products. Capitalism requires people to consume.
  - claydavisss 8y ago
    You as an individual are not responsible for saving capitalism You are responsible for your own welfare though, particularly in the US What are these people supposed to do - stay broke to make some soundbite economist happy? It is perfectly rational for people living in a society without safety nets to weave their own
    - prolikewh0a 8y ago
      That doesn't answer my question. People have always weaved their own safety nets and saved, but if this is becoming common in USA to spend almost nothing and live frugal, how can this system stay afloat? Another point that's pretty unrelated, why would you live decades of your life doing nothing, living extremely frugally? Sounds like a pretty garbage life to me.
      - claydavisss 8y ago
        As long as my boat is afloat, I care not about yours. If the US fails, I will sail my boat elsewhere. We created the scenario these people are reacting to Worry not, we will not run out of people willing to impoverish themselves buying baubles
        prolikewh0a 8y ago
        >As long as my boat is afloat, I care not about yours. Everything that's wrong about the USA right here.
        citrablue 8y ago
        It could also be the perspective that you can really only try to control your own lot in life. Is it not possible that by focusing on my own welfare, I am more productive and happier? And that by trying to float other boats, I am distracted and less happy? I don't subscribe to the OPs opinion, necessarily, just pointing out a situation where it might be better to just take care of yourself.
        claydavisss 8y ago
        Yet you are the one telling us we all have to spend ourselves into the poorhouse or society will tip over....
      - isoskeles 8y ago
        Living extremely frugally doesn’t equate to doing “nothing.” If we’re going to start passing judgment, pinning happiness to consumerism seems like a pretty garbage life to me.
        prolikewh0a 8y ago
        It's not just consumerism. What doesn't cost money? Walking around?
  - prostoalex 8y ago
    But the purpose of such saving is to prolong the consumption in the future.
  - nawitus 8y ago
    Spending money on basic necessities like housing, food, electricity, water, health care etc. is still consumption. Also note that retirement can still contain some money for extra widgets and other fun stuff - just less than the average consumer.
  - eswat 8y ago
    Other than the biggest costs—housing, food, transportation and perhaps healthcare—I doubt people that FIREd have withdrawn 100% from inconspicuous consumption. They just focus that consumption on more necessities than frivolities.
  - jogjayr 8y ago
    It's been addressed on MMM: http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-became-frugal/ http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-b... The key quote: "If an entire society gradually decides that it wants to consume less, then it needs to produce less as well. If there is less stuff that needs to be produced, then people don’t have to work as many hours to create it. That’s perfect, because many people will be dropping out of the workforce much earlier as they finish earning the money they need to get going on their early retirement. The shortage of available work will be balanced by the reduced number of people willing to do that work."
nawitus 8y ago
"Capitalism" doesn't contain values like "you must spend money on something else than housing and food". It just happens that people do spend money on things other than housing and food, so the market system does provide these services in demand.
awinder 8y ago
Not sure for why you’re getting downvoted, but I think your point (which I would agree with) is that if large majorities were to act in this way, that system would be sustainable for nobody. The reason why FIRE works in this way is that people are piggybacking on a consumption culture to reap the benefits of compounding interest on stocks, without personally contributing to it. You’re not going to see avg 8% gains in index funds in a world where wealth is hoarded, and FIRE isn’t going to work without that high compounding rate. This is one of the things that bugs me about the FIRE “movement”. it’s a great hack for the people doing it, but it can’t become a mainstream system without breaking.
- jogjayr 8y ago
  It's been addressed on MMM: http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-became-frugal/ http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-b... The key quote: "If an entire society gradually decides that it wants to consume less, then it needs to produce less as well. If there is less stuff that needs to be produced, then people don’t have to work as many hours to create it. That’s perfect, because many people will be dropping out of the workforce much earlier as they finish earning the money they need to get going on their early retirement. The shortage of available work will be balanced by the reduced number of people willing to do that work."
cronix 8y ago
Yes, but money doesn't just "sit in a bank account." It's being used to lend other people money, start new businesses, help other businesses expand, etc. So, it's actually contributing to the economy and "being spent" in the capitalistic system, isn't it? It's just not "spent" by the people "holding it in their account", but by the bank or whatever institution is "holding" it.

claydavisss 8y ago

No - they are ahering to the first principle of capitalism - take care of yourself!

prolikewh0a 8y ago
Ok, but you still need people to buy things. If they're only saving, there's no demand for products. Capitalism requires people to consume.
- claydavisss 8y ago
  You as an individual are not responsible for saving capitalism You are responsible for your own welfare though, particularly in the US What are these people supposed to do - stay broke to make some soundbite economist happy? It is perfectly rational for people living in a society without safety nets to weave their own
  - prolikewh0a 8y ago
    That doesn't answer my question. People have always weaved their own safety nets and saved, but if this is becoming common in USA to spend almost nothing and live frugal, how can this system stay afloat? Another point that's pretty unrelated, why would you live decades of your life doing nothing, living extremely frugally? Sounds like a pretty garbage life to me.
    - claydavisss 8y ago
      As long as my boat is afloat, I care not about yours. If the US fails, I will sail my boat elsewhere. We created the scenario these people are reacting to Worry not, we will not run out of people willing to impoverish themselves buying baubles
      - prolikewh0a 8y ago
        >As long as my boat is afloat, I care not about yours. Everything that's wrong about the USA right here.
        citrablue 8y ago
        It could also be the perspective that you can really only try to control your own lot in life. Is it not possible that by focusing on my own welfare, I am more productive and happier? And that by trying to float other boats, I am distracted and less happy? I don't subscribe to the OPs opinion, necessarily, just pointing out a situation where it might be better to just take care of yourself.
        claydavisss 8y ago
        Yet you are the one telling us we all have to spend ourselves into the poorhouse or society will tip over....
    - isoskeles 8y ago
      Living extremely frugally doesn’t equate to doing “nothing.” If we’re going to start passing judgment, pinning happiness to consumerism seems like a pretty garbage life to me.
      - prolikewh0a 8y ago
        It's not just consumerism. What doesn't cost money? Walking around?
- prostoalex 8y ago
  But the purpose of such saving is to prolong the consumption in the future.
- nawitus 8y ago
  Spending money on basic necessities like housing, food, electricity, water, health care etc. is still consumption. Also note that retirement can still contain some money for extra widgets and other fun stuff - just less than the average consumer.
- eswat 8y ago
  Other than the biggest costs—housing, food, transportation and perhaps healthcare—I doubt people that FIREd have withdrawn 100% from inconspicuous consumption. They just focus that consumption on more necessities than frivolities.
- jogjayr 8y ago
  It's been addressed on MMM: http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-became-frugal/ http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-b... The key quote: "If an entire society gradually decides that it wants to consume less, then it needs to produce less as well. If there is less stuff that needs to be produced, then people don’t have to work as many hours to create it. That’s perfect, because many people will be dropping out of the workforce much earlier as they finish earning the money they need to get going on their early retirement. The shortage of available work will be balanced by the reduced number of people willing to do that work."

nawitus 8y ago

"Capitalism" doesn't contain values like "you must spend money on something else than housing and food". It just happens that people do spend money on things other than housing and food, so the market system does provide these services in demand.

awinder 8y ago

Not sure for why you’re getting downvoted, but I think your point (which I would agree with) is that if large majorities were to act in this way, that system would be sustainable for nobody. The reason why FIRE works in this way is that people are piggybacking on a consumption culture to reap the benefits of compounding interest on stocks, without personally contributing to it. You’re not going to see avg 8% gains in index funds in a world where wealth is hoarded, and FIRE isn’t going to work without that high compounding rate. This is one of the things that bugs me about the FIRE “movement”. it’s a great hack for the people doing it, but it can’t become a mainstream system without breaking.

jogjayr 8y ago
It's been addressed on MMM: http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-became-frugal/ http://www.mrmoneymustache.com/2012/04/09/what-if-everyone-b... The key quote: "If an entire society gradually decides that it wants to consume less, then it needs to produce less as well. If there is less stuff that needs to be produced, then people don’t have to work as many hours to create it. That’s perfect, because many people will be dropping out of the workforce much earlier as they finish earning the money they need to get going on their early retirement. The shortage of available work will be balanced by the reduced number of people willing to do that work."

cronix 8y ago

Yes, but money doesn't just "sit in a bank account." It's being used to lend other people money, start new businesses, help other businesses expand, etc. So, it's actually contributing to the economy and "being spent" in the capitalistic system, isn't it? It's just not "spent" by the people "holding it in their account", but by the bank or whatever institution is "holding" it.