3 ms·

"Inflation isn't going away" is an argument against holding cash, but since salary increases have kept up with inflation, how is it an argument for "move from t

"Inflation isn't going away" is an argument against holding cash, but since salary increases have kept up with inflation, how is it an argument for "move from the worker class to the capital owning class"?

no_wizard 2y ago
>since salary increases have kept up with inflation, On the actual whole, they haven't. In the last few years, salary increases did for the time period of 2020-2023 (as far as I am aware that is what we have data for around this assertion) but generally they have not. IMO, a better measure is how well have salary increases kept up with gains in productivity, and when you look at that its truly abysmal.
- hollerith 2y ago
  When an individual faces the choice on how much to depend on salary and how much on investment income, I don't see how productivity of labor has any relevance. For example, I might be a member of a guild that keeps my salary nice and high while having the negative effect of keeping the productivity of the guild constant, which would be bad for society, but good for me. Also, we are mostly software developers here, and dev salaries certainly have kept up with inflation.
  - no_wizard 2y ago
    >When an individual faces the choice on how much to depend on salary and how much on investment income, I don't see how productivity of labor has any relevance. I was saying this in reference to how much we get paid. As a reflection of value / worth. Compared to the value generated, our salaries are relatively small, and its hard to argue otherwise when you look at productivity gains. If you want to capture more of those gains, being invested in index funds is a good step in that direction. >Also, we are mostly software developers here, and dev salaries certainly have kept up with inflation. Even if this is true - and I don't know that it is so broadly true that it can be accepted as the median circumstance of HN users - that situation won't last forever, and more importantly salary is not controlled by you its controlled by another entity. The entire premise of the conversation is convert your salary - something you may depend on but isn't something you have sole control over - into things that you do have more control over (index funds) or effectively sole control over (real estate investments most commonly). This allows you to decouple your wealth from any single entity, which is the central goal.
anthonypasq 2y ago
owning assets is better than owning fiat currency. assets are real and will always have value. also the US tax code heavily favors owners. Income tax can be > 30% but capital gains tax is < 20%

no_wizard 2y ago

>since salary increases have kept up with inflation, On the actual whole, they haven't. In the last few years, salary increases did for the time period of 2020-2023 (as far as I am aware that is what we have data for around this assertion) but generally they have not. IMO, a better measure is how well have salary increases kept up with gains in productivity, and when you look at that its truly abysmal.

hollerith 2y ago
When an individual faces the choice on how much to depend on salary and how much on investment income, I don't see how productivity of labor has any relevance. For example, I might be a member of a guild that keeps my salary nice and high while having the negative effect of keeping the productivity of the guild constant, which would be bad for society, but good for me. Also, we are mostly software developers here, and dev salaries certainly have kept up with inflation.
- no_wizard 2y ago
  >When an individual faces the choice on how much to depend on salary and how much on investment income, I don't see how productivity of labor has any relevance. I was saying this in reference to how much we get paid. As a reflection of value / worth. Compared to the value generated, our salaries are relatively small, and its hard to argue otherwise when you look at productivity gains. If you want to capture more of those gains, being invested in index funds is a good step in that direction. >Also, we are mostly software developers here, and dev salaries certainly have kept up with inflation. Even if this is true - and I don't know that it is so broadly true that it can be accepted as the median circumstance of HN users - that situation won't last forever, and more importantly salary is not controlled by you its controlled by another entity. The entire premise of the conversation is convert your salary - something you may depend on but isn't something you have sole control over - into things that you do have more control over (index funds) or effectively sole control over (real estate investments most commonly). This allows you to decouple your wealth from any single entity, which is the central goal.

anthonypasq 2y ago

owning assets is better than owning fiat currency. assets are real and will always have value. also the US tax code heavily favors owners. Income tax can be > 30% but capital gains tax is < 20%