4 ms·

Yeah, but that $150T is no longer worth $110T (and that number itself was illusory).

jeffbee 4y ago
That is the curse of inflation. Your household is now worth millions but you can't afford a house. This has always been the lie of compound interest and savings. You're always told that if you don't buy a Big Mac and put the $2.99 in the bank instead, you'll have ten dollars in 30 years. But in 30 years a Big Mac is going to cost $12, so you just played yourself. The whole system is an illusion.
- thaumasiotes 4y ago
  > You're always told that if you don't buy a Big Mac and put the $2.99 in the bank instead, you'll have ten dollars in 30 years. But in 30 years a Big Mac is going to cost $12, so you just played yourself. There's more to it than that. You also get to pay taxes on your $7 of capital gains.
  - deathanatos 4y ago
    You'll get to pay taxes on that Big Mac too.
    - thaumasiotes 4y ago
      The point here isn't so much that all taxes are unreasonable as that, in this scenario, there are no capital gains, but you're paying capital gains taxes anyway. You're paying a 10% tax (assuming capital gains tax rate of 15%) on an investment that is down 17%.
      - deathanatos 4y ago
        True enough. Though… the original example is in the bank. If I stick $2.99 in the bank, in 30 years, I'll have $3.08. (Or $0 when the bank decides to add some random fee, which is why my H"S"A is currently giving a negative return…)
- collegeburner 4y ago
  It's on purpose. Consoom now, spend all your money on grubhub and funko pops and onlyfans and weed otherwise it will be worth less later. Just trust the government to take care of you. Poor people aren't allowed to get rich any more.
  - throwaway0a5e 4y ago
    It seems to me the only way to level up (without extraordinary luck) is say fuck the system and run an under the table business and hope you can get rich enough to pivot to something "legit" before the state comes and screws you.
- vkou 4y ago
  It's not an illusion, it's doing exactly what it's designed, which is stimulating the economy by discouraging you from sitting on a dragon hoard of money. The more money moves around in the economy, the more work gets done. When money stops moving, people lose their jobs, productive output drops, etc, etc.
AnimalMuppet 4y ago
Inflation ran more than 36% over the last two years? Sorry, no. It may feel like it, but still no.
- whichfawkes 4y ago
  Because not all wealth is liquid, the future purchasing power of the money you'd get from the assets matters as well. We've seen about 11% inflation since 2019 already, but the m1 money supply increased by about 40% during this time. I have yet to hear anyone suggest reasons why consumer prices will not eventually catch up to that 40%. There's a big difference between it happening overnight versus happening over the course of a decade, but it still matters. On another thread: Presumably, houses are included in this metric. You could sell your massively overvalued house now, and realize that gain in asset prices... But then you're probably going to either be paying inflated rent or buying another property with an inflated value so it kind of ends up being a wash.

That is the curse of inflation. Your household is now worth millions but you can't afford a house. This has always been the lie of compound interest and savings. You're always told that if you don't buy a Big Mac and put the $2.99 in the bank instead, you'll have ten dollars in 30 years. But in 30 years a Big Mac is going to cost $12, so you just played yourself. The whole system is an illusion.

thaumasiotes 4y ago
> You're always told that if you don't buy a Big Mac and put the $2.99 in the bank instead, you'll have ten dollars in 30 years. But in 30 years a Big Mac is going to cost $12, so you just played yourself. There's more to it than that. You also get to pay taxes on your $7 of capital gains.
- deathanatos 4y ago
  You'll get to pay taxes on that Big Mac too.
  - thaumasiotes 4y ago
    The point here isn't so much that all taxes are unreasonable as that, in this scenario, there are no capital gains, but you're paying capital gains taxes anyway. You're paying a 10% tax (assuming capital gains tax rate of 15%) on an investment that is down 17%.
    - deathanatos 4y ago
      True enough. Though… the original example is in the bank. If I stick $2.99 in the bank, in 30 years, I'll have $3.08. (Or $0 when the bank decides to add some random fee, which is why my H"S"A is currently giving a negative return…)
collegeburner 4y ago
It's on purpose. Consoom now, spend all your money on grubhub and funko pops and onlyfans and weed otherwise it will be worth less later. Just trust the government to take care of you. Poor people aren't allowed to get rich any more.
- throwaway0a5e 4y ago
  It seems to me the only way to level up (without extraordinary luck) is say fuck the system and run an under the table business and hope you can get rich enough to pivot to something "legit" before the state comes and screws you.
vkou 4y ago
It's not an illusion, it's doing exactly what it's designed, which is stimulating the economy by discouraging you from sitting on a dragon hoard of money. The more money moves around in the economy, the more work gets done. When money stops moving, people lose their jobs, productive output drops, etc, etc.

AnimalMuppet 4y ago

Inflation ran more than 36% over the last two years? Sorry, no. It may feel like it, but still no.

whichfawkes 4y ago
Because not all wealth is liquid, the future purchasing power of the money you'd get from the assets matters as well. We've seen about 11% inflation since 2019 already, but the m1 money supply increased by about 40% during this time. I have yet to hear anyone suggest reasons why consumer prices will not eventually catch up to that 40%. There's a big difference between it happening overnight versus happening over the course of a decade, but it still matters. On another thread: Presumably, houses are included in this metric. You could sell your massively overvalued house now, and realize that gain in asset prices... But then you're probably going to either be paying inflated rent or buying another property with an inflated value so it kind of ends up being a wash.