4 ms·

Ooh, can you tie in the final abandonment of the gold standard, the introduction of the IRA/401(k), and the relationship between insane over-leveraged derivativ

Ooh, can you tie in the final abandonment of the gold standard, the introduction of the IRA/401(k), and the relationship between insane over-leveraged derivatives markets and American consumer financial health? Afaik, the successful tying of the consumer investment (and especially retirement) account to the performance of the financial market (rather than to the parts of the market that manifest themselves in more physical ways) has created a situation where any large-scale decision that might improve the material lives of Americans but would harm the 'market' (via lowering the value of the USD or certain fund share prices) has become untenable. Millions of voters can be controlled by trotting out "never hurt the market because then what will happen to your investments?" whenever something interesting comes along. I'm certain that the enormous subsidization of the housing market and the associated treatment of housing as a primary investment vehicle for those same voters is related.

mountainofdeath 5y ago
What you describe is mostly a political decision that effectively subsidizes the mutual fund, broker and financial planning markets and the broader equities (and to a lesser extent, fixed income market) to the benefit of...you guessed...people who already own it. Pension funds invest in many of the same things everyone else invests in, directly or indirectly. The difference is now you have millions of amateurs with small sums versus a few hundred professionally managed institutions. Either way, the little guy loses.
tablespoon 5y ago
> Millions of voters can be controlled by trotting out "never hurt the market because then what will happen to your investments?" whenever something interesting comes along. The 401k has served as a clever trick to get large numbers of laborers to support policies that mainly benefit rich capitalists and to oppose many policies that would help themselves.
- quacked 5y ago
  That is precisely my position. It is a scam; producing very little value that didn't already exist for Americans while enriching the owners of the 401(k) portfolios beyond nearly anyone in history.

mountainofdeath 5y ago

What you describe is mostly a political decision that effectively subsidizes the mutual fund, broker and financial planning markets and the broader equities (and to a lesser extent, fixed income market) to the benefit of...you guessed...people who already own it. Pension funds invest in many of the same things everyone else invests in, directly or indirectly. The difference is now you have millions of amateurs with small sums versus a few hundred professionally managed institutions. Either way, the little guy loses.

tablespoon 5y ago

> Millions of voters can be controlled by trotting out "never hurt the market because then what will happen to your investments?" whenever something interesting comes along. The 401k has served as a clever trick to get large numbers of laborers to support policies that mainly benefit rich capitalists and to oppose many policies that would help themselves.

quacked 5y ago
That is precisely my position. It is a scam; producing very little value that didn't already exist for Americans while enriching the owners of the 401(k) portfolios beyond nearly anyone in history.