38 ms·

I highly suspect the reason for this is because there is less income security for the young generation in 2021 compared to 1999. In 1999, people under 40 were

I highly suspect the reason for this is because there is less income security for the young generation in 2021 compared to 1999. In 1999, people under 40 were gambling large sums that, if lost, could be made back through x months of work. In 2021, people under 40 are gambling any random ad hoc payment they receive in the attempt of calling it a career. The reason? 10% of our country have great jobs, and the rest have none. That is a result of policy.

missedthecue 6y ago
The median bottom quintile of incomes is higher today in real terms than is was in the 1990s, and the median income is higher as well. https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-households.html https://www.census.gov/data/tables/time-series/demo/income-p...
- toomuchtodo 6y ago
  And yet, education, healthcare, and housing raced away from wages. I'm not here to argue a failed economic system in this thread, but the motivation behind wsb's nihilism is exceptionally clear. https://www.pewresearch.org/fact-tank/2020/09/04/a-majority-of-young-adults-in-the-u-s-live-with-their-parents-for-the-first-time-since-the-great-depression/ https://www.pewresearch.org/fact-tank/2020/09/04/a-majority-... (A majority of young adults in the U.S. live with their parents for the first time since the Great Depression) https://www.cnbc.com/2019/02/11/this-is-the-real-reason-most-americans-file-for-bankruptcy.html https://www.cnbc.com/2019/02/11/this-is-the-real-reason-most... (66% of bankruptcies are tied to medical issues) https://www.theatlantic.com/ideas/archive/2020/02/great-affordability-crisis-breaking-america/606046/ https://www.theatlantic.com/ideas/archive/2020/02/great-affo... (The Great Affordability Crisis Breaking America)
  - aaahayatav 6y ago
    Agreed. I think it is lazy to look at the rise in real income and not look at the rise in real expenses and decline in stable, non-precarious employment.
  - api 6y ago
    All three of those things are things that are hard to outsource. My suspicion for a long time has been that we've actually had massive inflation since roughly the year 2000, but it's been masked by the effect of outsourcing and automation reducing the price of pretty much all manufactured goods.
    - toomuchtodo 6y ago
      https://www.epi.org/productivity-pay-gap/ https://www.epi.org/productivity-pay-gap/ (Reduced labor power) https://www.theatlantic.com/ideas/archive/2019/02/new-american-populism-needed-save-west/582202/ https://www.theatlantic.com/ideas/archive/2019/02/new-americ... (Globalization) https://www.lynalden.com/money-printing/ https://www.lynalden.com/money-printing/ (Assets bubbles from central reserve QE) https://fred.stlouisfed.org/series/WALCL https://fred.stlouisfed.org/series/WALCL (Fed Total Assets)
  - arcticbull 6y ago
    Housing is a tough one; houses on average cost the same amount on an inflation adjusted basis per square foot as they did in the 1970s. However, houses are on average twice as big as they were back then, and contain far fewer occupants on average, too. In 1970 the average household was 3.14 people, today it's 2.5 people. [edit] There's a lot of reasons for the increase in the actual price of accommodation. They're largely driven by local ordinances. Setback rules, minimum size rules, minimum number of bathrooms/closets/etc all - all sorts of code things. Further, in major metros city councils refuse to increase supply to meet demand - to benefit existing landowners. One solution to this is national zoning rules like Japan has.
    - deleted 6y ago
      [deleted]
    - missedthecue 6y ago
      The inflation adjusted cost of buying a house today is actually cheaper per square foot than it was in 1980, and that's before you factor in the 14% mortgage rates of the era.
      - aaahayatav 6y ago
        The 14% mortgage rates came in part from the law of small (big) numbers. 14% of $35,000 is not that much money compared to 3% of 700,000
        arcticbull 6y ago
        Sort of, right, because after inflation 14% of 35,000 ($233,463.53 in 2021 dollars @ 14% = $32,620) is still a lot more than 3% of 700,000 ($21,000).
        missedthecue 6y ago
        But your typical home did not cost $35k then, and your typical home does not cost $700k now
  - dcolkitt 6y ago
    Education only makes up 2.3% of household expenditures and healthcare 8.2%.[1] You're cherry picking and ignoring strong deflationary pressures increasing the affordability of food (13% of expenditures), clothing (3%), transportation (17%), utilities (6.5%), entertainment (5%), and furniture and appliances (3.3%). As for housing, the cost per square foot, adjusted for inflation, is only 12% higher than it was in 2000. (Moreover this doesn't account for the major improvements in new housing stock, such as fire safety, attached garages, swimming pools, high ceilings, central A/C, high-capacity electrical circuits, etc.) The median cost of housing has only gone up, because consumers have demanded substantially larger homes. And this ignores the fact that mortgage rates are substantially lower than historical averages. Even accounting for our bigger, nicer homes, the percent of expenitures on shelter has barely budged from 18.7% in 2000 to 19.1% in 2019. [1]https://www.bls.gov/cex/2019/combined/age.pdf https://www.bls.gov/cex/2019/combined/age.pdf [2]https://www.statista.com/statistics/682549/average-price-per-square-foot-in-new-single-family-houses-usa/ https://www.statista.com/statistics/682549/average-price-per... [3]https://www.bls.gov/cex/2005/standard/multiyr.pdf https://www.bls.gov/cex/2005/standard/multiyr.pdf
    - toomuchtodo 6y ago
      > You're cherry picking and ignoring strong deflationary pressures increasing the affordability of food (13% of expenditures), clothing (3%), transportation (17%), utilities (6.5%), entertainment (5%), and furniture and appliances (3.3%). I'm not ignoring these at all, and it should be clear where these lie on Maslow's hierarchy versus shelter, healthcare, and earning potential (education) [1]. Mortgage rates being low only means you're bidding up scarce assets further by borrowing with the little income you have. This attempts to sell affordability in the same way a car dealer salesperson sells you on the payment, not the price. And transportation? The average price of a new car just surpassed $40k [2]. There's a reason 7 year car loans have become common [3]. [1] https://www.reuters.com/article/us-usa-fed-dudley-ipad/ipad-price-remark-gets-feds-dudley-an-earful-idUSTRE72A4AC20110311 https://www.reuters.com/article/us-usa-fed-dudley-ipad/ipad-... (“I can’t eat an iPad.”) [2] https://www.usatoday.com/story/money/cars/2021/01/07/new-cars-trucks-suvs-financing-downpayment-prices/4139776001/ https://www.usatoday.com/story/money/cars/2021/01/07/new-car... [3] https://www.npr.org/2019/10/31/773409100/the-7-year-car-loan-watch-your-wallet https://www.npr.org/2019/10/31/773409100/the-7-year-car-loan...
- aaahayatav 6y ago
  Is that measured on a monthly or yearly basis? Are those incomes reconciled with increases of cost of living? You should compare workforce participation from 1999 and 2021, and you should compare savings rates by age bracket.
- CameronNemo 6y ago
  How are you measuring real income? Inflation has many measurements and benchmarks. Two large expenses, health and housing, have skyrocketed in the past two decades.
- ALittleLight 6y ago
  This looks like household incomes, not incomes for individual earners. There has been a huge rise in double income households - i.e. households where there are two working adults. In the 60's 25% of households were double income, compared to ~60% now. If incomes are up 40%, but it requires a commensurate increase in work, is that really an improvement? https://www.pewresearch.org/ft_dual-income-households-1960-2012-2/ https://www.pewresearch.org/ft_dual-income-households-1960-2...
notJim 6y ago
I think you really have to look at fed policy and the stock market to understand this. We're in the midst of a barely-uncontrolled pandemic that has caused massive disruption and unemployment in particular sectors, and yet the stock market is hot as shit. I don't think it's irrational to look at that and conclude that it's better to get it while the getting is good.
please333 6y ago
You think we have 90% unemployment?
sfblah 6y ago
Agreed. Just wanted to add that the policy in question is reacting to recessions using monetary policy instead of fiscal stimulus, because of gridlock and regulatory capture. The government is largely at fault for the current bubble. I fear for what will happen if/when it pops.

missedthecue 6y ago

The median bottom quintile of incomes is higher today in real terms than is was in the 1990s, and the median income is higher as well. https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-households.html https://www.census.gov/data/tables/time-series/demo/income-p...

toomuchtodo 6y ago
And yet, education, healthcare, and housing raced away from wages. I'm not here to argue a failed economic system in this thread, but the motivation behind wsb's nihilism is exceptionally clear. https://www.pewresearch.org/fact-tank/2020/09/04/a-majority-of-young-adults-in-the-u-s-live-with-their-parents-for-the-first-time-since-the-great-depression/ https://www.pewresearch.org/fact-tank/2020/09/04/a-majority-... (A majority of young adults in the U.S. live with their parents for the first time since the Great Depression) https://www.cnbc.com/2019/02/11/this-is-the-real-reason-most-americans-file-for-bankruptcy.html https://www.cnbc.com/2019/02/11/this-is-the-real-reason-most... (66% of bankruptcies are tied to medical issues) https://www.theatlantic.com/ideas/archive/2020/02/great-affordability-crisis-breaking-america/606046/ https://www.theatlantic.com/ideas/archive/2020/02/great-affo... (The Great Affordability Crisis Breaking America)
- aaahayatav 6y ago
  Agreed. I think it is lazy to look at the rise in real income and not look at the rise in real expenses and decline in stable, non-precarious employment.
- api 6y ago
  All three of those things are things that are hard to outsource. My suspicion for a long time has been that we've actually had massive inflation since roughly the year 2000, but it's been masked by the effect of outsourcing and automation reducing the price of pretty much all manufactured goods.
  - toomuchtodo 6y ago
    https://www.epi.org/productivity-pay-gap/ https://www.epi.org/productivity-pay-gap/ (Reduced labor power) https://www.theatlantic.com/ideas/archive/2019/02/new-american-populism-needed-save-west/582202/ https://www.theatlantic.com/ideas/archive/2019/02/new-americ... (Globalization) https://www.lynalden.com/money-printing/ https://www.lynalden.com/money-printing/ (Assets bubbles from central reserve QE) https://fred.stlouisfed.org/series/WALCL https://fred.stlouisfed.org/series/WALCL (Fed Total Assets)
- arcticbull 6y ago
  Housing is a tough one; houses on average cost the same amount on an inflation adjusted basis per square foot as they did in the 1970s. However, houses are on average twice as big as they were back then, and contain far fewer occupants on average, too. In 1970 the average household was 3.14 people, today it's 2.5 people. [edit] There's a lot of reasons for the increase in the actual price of accommodation. They're largely driven by local ordinances. Setback rules, minimum size rules, minimum number of bathrooms/closets/etc all - all sorts of code things. Further, in major metros city councils refuse to increase supply to meet demand - to benefit existing landowners. One solution to this is national zoning rules like Japan has.
  - deleted 6y ago
    [deleted]
  - missedthecue 6y ago
    The inflation adjusted cost of buying a house today is actually cheaper per square foot than it was in 1980, and that's before you factor in the 14% mortgage rates of the era.
    - aaahayatav 6y ago
      The 14% mortgage rates came in part from the law of small (big) numbers. 14% of $35,000 is not that much money compared to 3% of 700,000
      - arcticbull 6y ago
        Sort of, right, because after inflation 14% of 35,000 ($233,463.53 in 2021 dollars @ 14% = $32,620) is still a lot more than 3% of 700,000 ($21,000).
      - missedthecue 6y ago
        But your typical home did not cost $35k then, and your typical home does not cost $700k now
- dcolkitt 6y ago
  Education only makes up 2.3% of household expenditures and healthcare 8.2%.[1] You're cherry picking and ignoring strong deflationary pressures increasing the affordability of food (13% of expenditures), clothing (3%), transportation (17%), utilities (6.5%), entertainment (5%), and furniture and appliances (3.3%). As for housing, the cost per square foot, adjusted for inflation, is only 12% higher than it was in 2000. (Moreover this doesn't account for the major improvements in new housing stock, such as fire safety, attached garages, swimming pools, high ceilings, central A/C, high-capacity electrical circuits, etc.) The median cost of housing has only gone up, because consumers have demanded substantially larger homes. And this ignores the fact that mortgage rates are substantially lower than historical averages. Even accounting for our bigger, nicer homes, the percent of expenitures on shelter has barely budged from 18.7% in 2000 to 19.1% in 2019. [1]https://www.bls.gov/cex/2019/combined/age.pdf https://www.bls.gov/cex/2019/combined/age.pdf [2]https://www.statista.com/statistics/682549/average-price-per-square-foot-in-new-single-family-houses-usa/ https://www.statista.com/statistics/682549/average-price-per... [3]https://www.bls.gov/cex/2005/standard/multiyr.pdf https://www.bls.gov/cex/2005/standard/multiyr.pdf
  - toomuchtodo 6y ago
    > You're cherry picking and ignoring strong deflationary pressures increasing the affordability of food (13% of expenditures), clothing (3%), transportation (17%), utilities (6.5%), entertainment (5%), and furniture and appliances (3.3%). I'm not ignoring these at all, and it should be clear where these lie on Maslow's hierarchy versus shelter, healthcare, and earning potential (education) [1]. Mortgage rates being low only means you're bidding up scarce assets further by borrowing with the little income you have. This attempts to sell affordability in the same way a car dealer salesperson sells you on the payment, not the price. And transportation? The average price of a new car just surpassed $40k [2]. There's a reason 7 year car loans have become common [3]. [1] https://www.reuters.com/article/us-usa-fed-dudley-ipad/ipad-price-remark-gets-feds-dudley-an-earful-idUSTRE72A4AC20110311 https://www.reuters.com/article/us-usa-fed-dudley-ipad/ipad-... (“I can’t eat an iPad.”) [2] https://www.usatoday.com/story/money/cars/2021/01/07/new-cars-trucks-suvs-financing-downpayment-prices/4139776001/ https://www.usatoday.com/story/money/cars/2021/01/07/new-car... [3] https://www.npr.org/2019/10/31/773409100/the-7-year-car-loan-watch-your-wallet https://www.npr.org/2019/10/31/773409100/the-7-year-car-loan...
aaahayatav 6y ago
Is that measured on a monthly or yearly basis? Are those incomes reconciled with increases of cost of living? You should compare workforce participation from 1999 and 2021, and you should compare savings rates by age bracket.
CameronNemo 6y ago
How are you measuring real income? Inflation has many measurements and benchmarks. Two large expenses, health and housing, have skyrocketed in the past two decades.
ALittleLight 6y ago
This looks like household incomes, not incomes for individual earners. There has been a huge rise in double income households - i.e. households where there are two working adults. In the 60's 25% of households were double income, compared to ~60% now. If incomes are up 40%, but it requires a commensurate increase in work, is that really an improvement? https://www.pewresearch.org/ft_dual-income-households-1960-2012-2/ https://www.pewresearch.org/ft_dual-income-households-1960-2...

notJim 6y ago

I think you really have to look at fed policy and the stock market to understand this. We're in the midst of a barely-uncontrolled pandemic that has caused massive disruption and unemployment in particular sectors, and yet the stock market is hot as shit. I don't think it's irrational to look at that and conclude that it's better to get it while the getting is good.

please333 6y ago

You think we have 90% unemployment?

sfblah 6y ago

Agreed. Just wanted to add that the policy in question is reacting to recessions using monetary policy instead of fiscal stimulus, because of gridlock and regulatory capture. The government is largely at fault for the current bubble. I fear for what will happen if/when it pops.