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Yes, though this also affects many people who have retirement accounts and pensions. The difference is primarily between those who derive their income from capi
by alexpetralia 6y ago
Yes, though this also affects many people who have retirement accounts and pensions. The difference is primarily between those who derive their income from capital (the financial economy) and those who derive it mostly from labor (the real economy).
- sideshowb 6y agoYeah, this. Can't speak for the US but in the UK most of the middle class (at a guess around 50% of the population) has at least some* of their retirement savings in pension funds which rely on capital growth to fulfill their intended purpose. *most of the rest being in house prices to which the same applies in part.
- DrAwdeOccarim 6y agoI kind of agree, but again me ≠ economist. I've found value in looking at the median reitrement account value of Americans. I say median, because the wealthy* skew the mean and so it's not valuable. https://dqydj.com/retirement-savings-by-age-united-states/ https://dqydj.com/retirement-savings-by-age-united-states/ So this tells us the average person who is retired or approaching retirement, has about $40,000 of retirement savings. If that went down to $20,000 (50% drop in total market) would that change their normal person lifestyle a lot? I would say no, because CPI is pretty low and prices are pretty low for things normal people buy. It shows the inflation in asset prices seem to be detached from reality.