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Wealth inequality between young and old has reached record high levels: https://www.forbes.com/sites/evapereira/2011/11/08/wealth-inequality-between-young-and-o

Wealth inequality between young and old has reached record high levels: https://www.forbes.com/sites/evapereira/2011/11/08/wealth-inequality-between-young-and-old-generations-reaches-record-high/ https://www.forbes.com/sites/evapereira/2011/11/08/wealth-in... Some possible causes: zoning laws, which benefit existing homeowners at the expense of future first time home buyers, have been piled on over the last 40 years. The economy in general has become much more regulated. In the financial services industry, regulations around existing laws, like the Bank Secrecy Act, have steadily increased over the last 40 years, and several major new laws, like the Community Reinvestment Act and Dodd-Frank, have been passed. The result is regulatory compliance costs making up 10% of expenses for banks with less than $100 million in assets, versus 5% for banks with between $5 billion and $10 billion in assets: https://www.communitybanking.org/~/media/files/compliance%20costs%20economies%20of%20scale%20and%20compliance%20performance.pdf https://www.communitybanking.org/~/media/files/compliance%20... Similar trends are seen in other major industries, like healthcare. Greater burdens on small businesses means less new business creation, which we've seen: https://money.cnn.com/2016/09/08/news/economy/us-startups-near-40-year-low/index.html https://money.cnn.com/2016/09/08/news/economy/us-startups-ne... And more benefits being accrued to incumbents. The public relations efforts of entrenched parties is totally overwhelming Millenials' efforts to cope too. Millenials are supporting many of the same political trends that are locking them out of industries. For example, the recent astroturfing campaign by the hotel lobby to turn the public against Airbnb and create public support for more regulatory barriers to renting one's place on Airbnb was very successful: https://www.nytimes.com/2017/04/16/technology/inside-the-hotel-industrys-plan-to-combat-airbnb.html https://www.nytimes.com/2017/04/16/technology/inside-the-hot... And Millenials make up a significant percentage of the dupes.

stochastic_monk 8y ago
Dodd-Frank is a very good thing. It’s not that regulation is intrinsically bad, it’s regulation that entrenches existing wealth.
- CryptoPunk 8y ago
  I can't imagine something that destroys small business as much as Dodd-Frank being a good thing on the balance: https://www.mercatus.org/publication/how-are-small-banks-faring-under-dodd-frank https://www.mercatus.org/publication/how-are-small-banks-far... Some relevant statistics: https://www.americanbanker.com/opinion/no-there-arent-too-many-banks-in-the-us https://www.americanbanker.com/opinion/no-there-arent-too-ma... >>Community banks have been instrumental in helping the nation recover from the financial crisis and economic downturn, yet their numbers continue to dwindle, declining by roughly 1,500 since 2009. .. >>A new survey from the Federal Reserve and Conference of State Bank Supervisors found that community bank compliance costs have increased by nearly $1 billion in the past two years to roughly $5.4 billion, or 24% of community bank net income.
  - awinder 8y ago
    It is when banks handing out shady mortgages crippled the entire economy and resulted in taxpayers having to shore things up to the tune of trillions of dollars. Some people are either too young to remember or too willful to remember, but 2008 was a dark place, and if it means a marginal impact on whatever destined-to-be-doomed small business is not getting off the ground due to increased scrutiny, I say good deal. Also Mercatus is a part of the Koch-aligned segment of GMU, to save any other onlookers some time understanding why the specific set of survey questions was posed the way they were. EDIT: also a lot of this information is dated because regulations were already weakened for small banks specifically: https://www.reuters.com/article/us-usa-house-banks-lobbying/small-banks-trump-wall-street-on-dodd-frank-rewrite-idUSKCN1IN328 https://www.reuters.com/article/us-usa-house-banks-lobbying/...
    - CryptoPunk 8y ago
      >>if it means a marginal impact on whatever destined-to-be-doomed small business is not getting off the ground due to increased scrutiny, I say good deal. It's not a "marginal impact". Regulations like Dodd-Frank impose a massive structural impediment to smaller business competitiveness that contribute to growing income inequality, and growing consolidation/centralization of industries. The Mercatus study shows just how much it increases costs for smaller banks. And it's not just "destined-to-be-doomed small business" that's eliminated: https://www.politico.com/agenda/story/2016/09/community-banks-dodd-frank-000197 https://www.politico.com/agenda/story/2016/09/community-bank... >>“Unfortunately, we became a victim of Dodd-Frank,” a northeastern community bank CEO recently wrote me. “In a few short years, an otherwise healthy community bank with strong capital and satisfactory earnings could no longer meet a number of financial benchmarks set by the regulators. These conclusions forced the bank to sell now when our shareholders and some of our employees would be less adversely affected.” The result: the bank merged with a larger bank and half of the employees lost their jobs. There are government programs like the GSEs and the FDIC that promote irresponsible mortgage lending. Those should be targeted for reform/elimination before centralizing and regimenting the industry with labyrinth laws like Dodd-Frank is considered.

stochastic_monk 8y ago

Dodd-Frank is a very good thing. It’s not that regulation is intrinsically bad, it’s regulation that entrenches existing wealth.

CryptoPunk 8y ago
I can't imagine something that destroys small business as much as Dodd-Frank being a good thing on the balance: https://www.mercatus.org/publication/how-are-small-banks-faring-under-dodd-frank https://www.mercatus.org/publication/how-are-small-banks-far... Some relevant statistics: https://www.americanbanker.com/opinion/no-there-arent-too-many-banks-in-the-us https://www.americanbanker.com/opinion/no-there-arent-too-ma... >>Community banks have been instrumental in helping the nation recover from the financial crisis and economic downturn, yet their numbers continue to dwindle, declining by roughly 1,500 since 2009. .. >>A new survey from the Federal Reserve and Conference of State Bank Supervisors found that community bank compliance costs have increased by nearly $1 billion in the past two years to roughly $5.4 billion, or 24% of community bank net income.
- awinder 8y ago
  It is when banks handing out shady mortgages crippled the entire economy and resulted in taxpayers having to shore things up to the tune of trillions of dollars. Some people are either too young to remember or too willful to remember, but 2008 was a dark place, and if it means a marginal impact on whatever destined-to-be-doomed small business is not getting off the ground due to increased scrutiny, I say good deal. Also Mercatus is a part of the Koch-aligned segment of GMU, to save any other onlookers some time understanding why the specific set of survey questions was posed the way they were. EDIT: also a lot of this information is dated because regulations were already weakened for small banks specifically: https://www.reuters.com/article/us-usa-house-banks-lobbying/small-banks-trump-wall-street-on-dodd-frank-rewrite-idUSKCN1IN328 https://www.reuters.com/article/us-usa-house-banks-lobbying/...
  - CryptoPunk 8y ago
    >>if it means a marginal impact on whatever destined-to-be-doomed small business is not getting off the ground due to increased scrutiny, I say good deal. It's not a "marginal impact". Regulations like Dodd-Frank impose a massive structural impediment to smaller business competitiveness that contribute to growing income inequality, and growing consolidation/centralization of industries. The Mercatus study shows just how much it increases costs for smaller banks. And it's not just "destined-to-be-doomed small business" that's eliminated: https://www.politico.com/agenda/story/2016/09/community-banks-dodd-frank-000197 https://www.politico.com/agenda/story/2016/09/community-bank... >>“Unfortunately, we became a victim of Dodd-Frank,” a northeastern community bank CEO recently wrote me. “In a few short years, an otherwise healthy community bank with strong capital and satisfactory earnings could no longer meet a number of financial benchmarks set by the regulators. These conclusions forced the bank to sell now when our shareholders and some of our employees would be less adversely affected.” The result: the bank merged with a larger bank and half of the employees lost their jobs. There are government programs like the GSEs and the FDIC that promote irresponsible mortgage lending. Those should be targeted for reform/elimination before centralizing and regimenting the industry with labyrinth laws like Dodd-Frank is considered.