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Thanks for bringing up this point. Anyone who has grown up in the US knows well how far down wages have gone. My father was an accountant. He could afford a ho

Thanks for bringing up this point. Anyone who has grown up in the US knows well how far down wages have gone. My father was an accountant. He could afford a house and raised a family of 5 on his salary at age 40, earning ~60k/yr. I'm an experienced developer. I make $200k/yr. I'm raising a family of 4 on my salary and i'm 40. I cant afford a house. Heck, I cant even afford more than a 2br apt. To me, it is completely meaningless that i earn 3x+ than my dad, the wages have not kept up with inflation. My 200k/yr doesnt buy me as much as 60k did a generation ago. How is this "no loss in jobs or lowering of wages". If anything this demonstrates that Increasing supply lowers wages. Who knew, economics was right all along!

rswail 8y ago
It's not that wages haven't kept up with general inflation, it's that wages have not kept up with asset inflation. So your 200K/year (accounting for inflation) probably buys roughly the same amount in goods and services as your father, but it can't buy real estate, because that has been inflated in an asset bubble. These asset bubbles (stocks, real estate) are driven by the fact that owners of capital have been able to depress taxation on capital growth, while increasing (in proportion) taxation on income. They have also been able to use the US national debt to let the Fed maintain their asset bubbles. Not to mention that in your father's day, inflation ate away at debt, much to the chagrin of the debt holders (ie suppliers of capital). Funnily enough, low inflation has meant that lenders do much better than borrowers.
- NeedMoreTea 8y ago
  That was always one of the advantages of a mortgage that was commonly mentioned and promoted. That your monthly payment would be effectively pennies after 20 years. Sustained low inflation meant that never came to pass. It was also one of the reasons for the Weimar Republic's hyperinflation. They started trying to inflate away some of the Versailles war reparations. Which got out of control, and then some.
- throwaway2048 8y ago
  Asset inflation is a part of inflation, unfortunately along with education and healthcare, our inflation indicators do an extremely poor job of measuring it.
mjfl 8y ago
There are plenty of places in the USA where $200k will get you very far, you just choose not to live there. You have to account for the fact that you're paying for that.
- adrianN 8y ago
  It's probably a lot harder to make $200k in those places.
sien 8y ago
Just for reference, in 1980 60K is about 174K today. https://www.officialdata.org/1980-dollars-in-2016?amount=60000 https://www.officialdata.org/1980-dollars-in-2016?amount=600... Also, housing is the one thing that has really shot up in price in many places in the US. Cars, computers, food, clothing and manufactured goods have plummeted in price. Education and health costs have also increased substantially.

rswail 8y ago

It's not that wages haven't kept up with general inflation, it's that wages have not kept up with asset inflation. So your 200K/year (accounting for inflation) probably buys roughly the same amount in goods and services as your father, but it can't buy real estate, because that has been inflated in an asset bubble. These asset bubbles (stocks, real estate) are driven by the fact that owners of capital have been able to depress taxation on capital growth, while increasing (in proportion) taxation on income. They have also been able to use the US national debt to let the Fed maintain their asset bubbles. Not to mention that in your father's day, inflation ate away at debt, much to the chagrin of the debt holders (ie suppliers of capital). Funnily enough, low inflation has meant that lenders do much better than borrowers.

NeedMoreTea 8y ago
That was always one of the advantages of a mortgage that was commonly mentioned and promoted. That your monthly payment would be effectively pennies after 20 years. Sustained low inflation meant that never came to pass. It was also one of the reasons for the Weimar Republic's hyperinflation. They started trying to inflate away some of the Versailles war reparations. Which got out of control, and then some.
throwaway2048 8y ago
Asset inflation is a part of inflation, unfortunately along with education and healthcare, our inflation indicators do an extremely poor job of measuring it.

mjfl 8y ago

There are plenty of places in the USA where $200k will get you very far, you just choose not to live there. You have to account for the fact that you're paying for that.

adrianN 8y ago
It's probably a lot harder to make $200k in those places.

sien 8y ago

Just for reference, in 1980 60K is about 174K today. https://www.officialdata.org/1980-dollars-in-2016?amount=60000 https://www.officialdata.org/1980-dollars-in-2016?amount=600... Also, housing is the one thing that has really shot up in price in many places in the US. Cars, computers, food, clothing and manufactured goods have plummeted in price. Education and health costs have also increased substantially.