4 ms·

Poor people largely aren't in debt. It's that rich people use massive amounts of artificially cheap debt to their advantage - and people without debt and assets

Poor people largely aren't in debt. It's that rich people use massive amounts of artificially cheap debt to their advantage - and people without debt and assets pay for the bill - because the Federal government keeps devaluing their earnings and savings to pay for the party.

mistrial9 6y ago
> Poor people largely aren't in debt. citations ?
- onlyrealcuzzo 6y ago
  >68% of personal debt is mortgage debt. Another ~10% is auto loan debt [1]. Most home owners aren't considered poor. A (largely) disproportionate share of poor people don't own cars, don't have access to credit, and also didn't go to college. The idea that poor people could hold a large percentage of debt is - in itself - paradoxical / ridiculous. In order to have debt, you need something to service the debt with. Otherwise, you're bankrupt. The major caveat here is student debt - anyone can load up on student debt regardless of ability to service - and there's no way out of the debt. You can't file bankruptcy. [1] https://www.fool.com/the-ascent/research/average-american-household-debt/ https://www.fool.com/the-ascent/research/average-american-ho...
  - ClumsyPilot 6y ago
    "and there's no way out of the debt. You can't file bankruptcy." To me (not from us) this sounds like indentured servitude. It's like a concept from the days when we used to burn people at the stake and executions happened on a public holiday so everyone could watch.
    - imtringued 6y ago
      It basically is. If you give someone money to the point where they cant pay the debt back and you never discharge the debt then you were actually just buying the ability to enslave that person. After all, you aren't in it for the money, you're in it for the debt relationship.
      - onlyrealcuzzo 6y ago
        This is basically what happened with Irish indentured servants, right?
srcmap 6y ago
Profitable companies such as MSFT, G, FB, etc likely not in debt nor need the money. Only the distress companies (Oil, Travel, Restaurant, Airlines) need debt more than anyone else.
- Daho0n 6y ago
  Sure they are. Almost everyone does, to the point it is really hard to compete if you don't make some magic debt too. They transfer money from country X to country Y, then a company owned by themselves build them a new warehouse for more money than the local branch have left and voilà, they are now in debt to themselves and don't pay taxes because of it while they get richer because they were already profitable. The richer the company the more they likely do this.
- julienb_sea 6y ago
  Literally every company takes on large amounts of leverage (debt) because they can likely produce more value with the $ than the interest payments on the debt. Just because you have the cash doesn't mean it makes sense to not take on debt.
- slavik81 6y ago
  Apple Inc. currently has $196 billion dollars in cash and $112 billion in debt.
pessimizer 6y ago
People without both debt and assets aren't paying anything. Poor people are in debt. They have student loans, medical debt, housing debt, etc.; there are people who owe on houses that they've been long evicted from. Inflation reduces that debt, which is why the fed believes its only mission is to hold inflation down. People with savings, and who own debt are the people who suffer from inflation. Or would, if there were any. Instead we just have an explosion in price of what rich people already own, like real estate.
- tmnvix 6y ago
  People without both debt and assets are paying in the sense that their ability to purchase assets (such as a home) in the future is being diminished.
  - onlyrealcuzzo 6y ago
    It's not just assets. Commodities are up 40% from 1-year ago verse the dollar.
    - nostrademons 6y ago
      Producer prices as well. An acquaintance of mine runs a box factory. His paper suppliers have hiked prices twice since November, and naturally he's going to be passing this (and more) on to his customers.
- Proziam 6y ago
  > People without both debt and assets aren't paying anything. Poor people without debt still pay because their buying power continually diminishes. Their $100 saved today isn't worth as much the next year. Poor people without assets still pay. They are forced to pay rent to those who have assets. The rent will be priced to cover the debt of the asset owner. > People with savings, and who own debt are the people who suffer from inflation. People with savings most typically invest it. The higher the inflation, the riskier the investments they will take to ensure their savings don't dwindle away.
- 6y ago

mistrial9 6y ago

> Poor people largely aren't in debt. citations ?

onlyrealcuzzo 6y ago
>68% of personal debt is mortgage debt. Another ~10% is auto loan debt [1]. Most home owners aren't considered poor. A (largely) disproportionate share of poor people don't own cars, don't have access to credit, and also didn't go to college. The idea that poor people could hold a large percentage of debt is - in itself - paradoxical / ridiculous. In order to have debt, you need something to service the debt with. Otherwise, you're bankrupt. The major caveat here is student debt - anyone can load up on student debt regardless of ability to service - and there's no way out of the debt. You can't file bankruptcy. [1] https://www.fool.com/the-ascent/research/average-american-household-debt/ https://www.fool.com/the-ascent/research/average-american-ho...
- ClumsyPilot 6y ago
  "and there's no way out of the debt. You can't file bankruptcy." To me (not from us) this sounds like indentured servitude. It's like a concept from the days when we used to burn people at the stake and executions happened on a public holiday so everyone could watch.
  - imtringued 6y ago
    It basically is. If you give someone money to the point where they cant pay the debt back and you never discharge the debt then you were actually just buying the ability to enslave that person. After all, you aren't in it for the money, you're in it for the debt relationship.
    - onlyrealcuzzo 6y ago
      This is basically what happened with Irish indentured servants, right?

srcmap 6y ago

Profitable companies such as MSFT, G, FB, etc likely not in debt nor need the money. Only the distress companies (Oil, Travel, Restaurant, Airlines) need debt more than anyone else.

Daho0n 6y ago
Sure they are. Almost everyone does, to the point it is really hard to compete if you don't make some magic debt too. They transfer money from country X to country Y, then a company owned by themselves build them a new warehouse for more money than the local branch have left and voilà, they are now in debt to themselves and don't pay taxes because of it while they get richer because they were already profitable. The richer the company the more they likely do this.
julienb_sea 6y ago
Literally every company takes on large amounts of leverage (debt) because they can likely produce more value with the $ than the interest payments on the debt. Just because you have the cash doesn't mean it makes sense to not take on debt.
slavik81 6y ago
Apple Inc. currently has $196 billion dollars in cash and $112 billion in debt.

pessimizer 6y ago

People without both debt and assets aren't paying anything. Poor people are in debt. They have student loans, medical debt, housing debt, etc.; there are people who owe on houses that they've been long evicted from. Inflation reduces that debt, which is why the fed believes its only mission is to hold inflation down. People with savings, and who own debt are the people who suffer from inflation. Or would, if there were any. Instead we just have an explosion in price of what rich people already own, like real estate.

tmnvix 6y ago
People without both debt and assets are paying in the sense that their ability to purchase assets (such as a home) in the future is being diminished.
- onlyrealcuzzo 6y ago
  It's not just assets. Commodities are up 40% from 1-year ago verse the dollar.
  - nostrademons 6y ago
    Producer prices as well. An acquaintance of mine runs a box factory. His paper suppliers have hiked prices twice since November, and naturally he's going to be passing this (and more) on to his customers.
Proziam 6y ago
> People without both debt and assets aren't paying anything. Poor people without debt still pay because their buying power continually diminishes. Their $100 saved today isn't worth as much the next year. Poor people without assets still pay. They are forced to pay rent to those who have assets. The rent will be priced to cover the debt of the asset owner. > People with savings, and who own debt are the people who suffer from inflation. People with savings most typically invest it. The higher the inflation, the riskier the investments they will take to ensure their savings don't dwindle away.
6y ago