6 ms·

Quick note, the 1996 $130k salary, when adjusted for inflation, is about $230,000 in 2021 dollars.

by clutchdude 5y ago

VLM 5y ago
Pew research data seems to imply it would be more like $150K
- Mindless2112 5y ago
  $220k according to Wolfram Alpha. https://www.wolframalpha.com/input/?i=%24130k+1996+USD+in+2021+USD https://www.wolframalpha.com/input/?i=%24130k+1996+USD+in+20...
- dlp211 5y ago
  BLS says closer to $250k using CPI. https://www.bls.gov/data/inflation_calculator.htm https://www.bls.gov/data/inflation_calculator.htm
bloodyplonker22 5y ago
I'm not a socialist, but we also have to adjust for what being a "millionaire" is today.
- dharmab 5y ago
  I've seen alternate definitions proposed for millionaire including $1M in annual income rather than net worth.
- lghh 5y ago
  Why would you being a socialist or not make a difference here?
- WalterBright 5y ago
  The 1920's version of a millionaire is like a billionaire today.
  - owenversteeg 5y ago
    Not really: there were billionaires back then as well (the first billionaire was Rockefeller in 1916.) By the CPI, $1 in 1920 would be about $14 in 2021. Nominal (non-real) GDP was around $900 nominal per capita. So a millionaire then would be have one thousand times the per capita GDP. Per capita GDP in 2020 was $63k, so as a multiple of per-capita GDP a millionaire would have $63 million. So a 1920s millionaire is the equivalent of somewhere between $14M and $63M today.
    - deleted 5y ago
      [deleted]
leppr 5y ago
And in the context of becoming a millionaire through investments, adjusting by more relevant factors than consumer goods inflation result in the following: * Residential real estate inflation: $355k [1] * Stock market inflation: $770k [2] * Dollar supply inflation: $712k [3] You'd have to earn between $350k and $700k/year for your dollars to have the same asset buying power as $130k/year in 1996. [1]: https://fred.stlouisfed.org/series/MSPUS https://fred.stlouisfed.org/series/MSPUS [2]: rough approximation through the S&P500 https://www.tradingview.com/chart/?symbol=SP%3ASPX https://www.tradingview.com/chart/?symbol=SP%3ASPX [3]: https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL
- sbelskie 5y ago
  That’s not what inflation is.
  - evv555 5y ago
    Exactly. Inflation is a gamed metric that doesn't reflect real loss of buying power.
  - leppr 5y ago
    In HN fashion you'd usually expound on which definitions of inflation you consider valid or not.
    - lkrubner 5y ago
      But in this case they are simply stating the truth, so I don’t think they need to say much. Rising prices for an asset cannot be called inflation, since the owner of the asset benefits from the rising prices. Inflation is specifically the opposite: the loss of value. Words need to have some meaning or we will have no way to communicate with one another.
      - leppr 5y ago
        Why would you switch perspective when describing assets vs consumer goods price rises? When considering the price of assets, a generalized rise in prices has the same relative effect as inflation in consumer goods; the decline in the purchasing power of money relative to other assets. The fact that some people benefit from assets inflation because they owned outsized amounts of assets compared to the rest of the population, is orthogonal to that base mechanism. Someone with a huge stock of oil would also benefit from an increase in oil prices following consumer goods inflation. Beware using convoluted gymnastics to hide simple truths. "Inflation" is first and foremost an English word. Human languages are abstract and powerful, there's more value in generalizing words to understand other realities, than restricting their use to a single "dictionary of economics" definition pointing to a single metric with predefined inputs.

Quick note, the 1996 $130k salary, when adjusted for inflation, is about $230,000 in 2021 dollars.

VLM 5y ago

Pew research data seems to imply it would be more like $150K

Mindless2112 5y ago
$220k according to Wolfram Alpha. https://www.wolframalpha.com/input/?i=%24130k+1996+USD+in+2021+USD https://www.wolframalpha.com/input/?i=%24130k+1996+USD+in+20...
dlp211 5y ago
BLS says closer to $250k using CPI. https://www.bls.gov/data/inflation_calculator.htm https://www.bls.gov/data/inflation_calculator.htm

bloodyplonker22 5y ago

I'm not a socialist, but we also have to adjust for what being a "millionaire" is today.

dharmab 5y ago
I've seen alternate definitions proposed for millionaire including $1M in annual income rather than net worth.
lghh 5y ago
Why would you being a socialist or not make a difference here?
WalterBright 5y ago
The 1920's version of a millionaire is like a billionaire today.
- owenversteeg 5y ago
  Not really: there were billionaires back then as well (the first billionaire was Rockefeller in 1916.) By the CPI, $1 in 1920 would be about $14 in 2021. Nominal (non-real) GDP was around $900 nominal per capita. So a millionaire then would be have one thousand times the per capita GDP. Per capita GDP in 2020 was $63k, so as a multiple of per-capita GDP a millionaire would have $63 million. So a 1920s millionaire is the equivalent of somewhere between $14M and $63M today.
  - deleted 5y ago
    [deleted]

leppr 5y ago

And in the context of becoming a millionaire through investments, adjusting by more relevant factors than consumer goods inflation result in the following: * Residential real estate inflation: $355k [1] * Stock market inflation: $770k [2] * Dollar supply inflation: $712k [3] You'd have to earn between $350k and $700k/year for your dollars to have the same asset buying power as $130k/year in 1996. [1]: https://fred.stlouisfed.org/series/MSPUS https://fred.stlouisfed.org/series/MSPUS [2]: rough approximation through the S&P500 https://www.tradingview.com/chart/?symbol=SP%3ASPX https://www.tradingview.com/chart/?symbol=SP%3ASPX [3]: https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL

sbelskie 5y ago
That’s not what inflation is.
- evv555 5y ago
  Exactly. Inflation is a gamed metric that doesn't reflect real loss of buying power.
- leppr 5y ago
  In HN fashion you'd usually expound on which definitions of inflation you consider valid or not.
  - lkrubner 5y ago
    But in this case they are simply stating the truth, so I don’t think they need to say much. Rising prices for an asset cannot be called inflation, since the owner of the asset benefits from the rising prices. Inflation is specifically the opposite: the loss of value. Words need to have some meaning or we will have no way to communicate with one another.
    - leppr 5y ago
      Why would you switch perspective when describing assets vs consumer goods price rises? When considering the price of assets, a generalized rise in prices has the same relative effect as inflation in consumer goods; the decline in the purchasing power of money relative to other assets. The fact that some people benefit from assets inflation because they owned outsized amounts of assets compared to the rest of the population, is orthogonal to that base mechanism. Someone with a huge stock of oil would also benefit from an increase in oil prices following consumer goods inflation. Beware using convoluted gymnastics to hide simple truths. "Inflation" is first and foremost an English word. Human languages are abstract and powerful, there's more value in generalizing words to understand other realities, than restricting their use to a single "dictionary of economics" definition pointing to a single metric with predefined inputs.