Inflation, real income, and politics Moved from: Interesting Articles Relating to EVs

[mpruet]

mpruet, You are obviously one of those for whom "things" worked out. That's great - for you. But please do not keep referencing your situation as if that were the norm. I have also had my share of successes - as well as my share of failures. Through it all I was able to understand that for many of us "but there for the luck of..." it could have been very different.

It sounds like you missed out on the rule - you only have to get rich once. If you had a share of successes, then that would have been time to protect what you had attained.

As far as HC's comment, that there may be more millionaires speaks to the fact that a million is no longer as much as it once was and ignores the fact that those are the bottom of the economic ladder are doing worse. This is income inequality and IS growing. Also according to Pew, income inequality in the U.S. is found to have increased by about 20% from 1980 to 2016.

And of the folks not improving their lot, how many are not putting what assets they have to work to create additional income streams?

I firmly believe that there are two large classes of folks in this world: 1) those who strongly believe that they are responsible for themselves and 2) those who believe that they are not. The first group will do whatever they can to improve their position while the second will just sit and blame someone else. Those in the first group will learn new skills, study new things, think about the implications of events, see trends, learn from mentors, and position themselves for success. The second group will not and then blame someone else because the stuff they are doing is no longer considered valuable.

Did you ever wonder what the poor buggy manufactures did when the auto became more common than the horse and buggy? Do you not see that the coal industry isn’t going to come back? Things change and those who resist that change will probably lose out. Sears is a recent example. Eastman Kodak is another. And Xerox is barely a fraction of its former self. And yet all of these companies had the opportunity to become much greater than they were in their prime. They all refused too grow when the environment changed.

 

[mpruet]

A lot of other millionaires came from real estate. Some from investing in it. Others by owning a house that goes up in value.

The shack your grandparents bought for a few thousand dollars that's now valued at 1.2 million? They are millionaires.

True, and that’s because real estate has a tangible value.

There’s a saying that investors in the stock market frequently say, “You only lose money when you sell.” The opposite is also true, you only make money when you sell. The property becomes more valuable because people are willing to buy it at a higher price.

 

[bullfrog !]

^^^Opportunities afforded to all equally in a perfect world might make that work for most but now where is that common or even normal in my opinion. It does happen for some with a lot of stars aligned just right but many have tried and failed or been pushed into a form of financial slavery in my opinion. Your odds of success have been better in this country in the past but that is changing again in my opinion.

 

[mpruet]

^^^Opportunities afforded to all equally in a perfect world might make that work for most but now where is that common or even normal in my opinion. It does happen for some with a lot of stars aligned just right but many have tried and failed or been pushed into a form of financial slavery in my opinion. Your odds of success have been better in this country in the past but that is changing again in my opinion.

I like your thoughts. But your first sentence is a prime example of the fundamental difference between the two basic groups that I described earlier. 1) the folks that strongly feel they are responsible for themselves and 2) those that feel that someone else is responsible.

The folks in group 1 would assume that they, themselves, are responsible for getting opportunities to improve themselves while those in group 2 would expect someone/something else has to provide opportunities for them.

Scarlet O’Hara was exhibiting group 1 when after the civil war she was in town and met someone at a lumber yard. She instantly knew that with the end of the war there would be massive reconstruction and that would require a lot of lumber. So she knew that anyone in the lumber business would become wealthy.

Now I’m not saying that you have to be as scheming as Scarlet was, but I am saying that opportunities exist almost anywhere anytime, and it’s up to you to take advantage of them.

 

[bullfrog !]

^^^Sadly for many or most of group 2 they have no idea of how or even what with to take advantage of opportunities even if they recognize them. Our current system has failed fo give equal opportunity to many and favors very few when it arises. Look at the number of small businesses that have disappeared and the percentage of startups that fail or are barely breaking even. Large corporations have expanded into things like single family property, farming and imports adding to the problem for individuals to succeed against competition with unlimited resources. Today Scarlet would be under priced long enough to run her out of business or buy her out for pennies on the dollar if she was lucky and end up with little or nothing on the streets till she became unhealthy and unable to work wondering how she allowed herself to get to such a state and eventually quit caring. There were quite few good people sitting on the group W bench ( during the draft you sat there if not considered moral enough to serve in the Army for those to young to know) bench that were not able or equipped to succeed.

 

[RonDean]

I like your thoughts. But your first sentence is a prime example of the fundamental difference between the two basic groups that I described earlier. 1) the folks that strongly feel they are responsible for themselves and 2) those that feel that someone else is responsible.

The folks in group 1 would assume that they, themselves, are responsible for getting opportunities to improve themselves while those in group 2 would expect someone/something else has to provide opportunities for them.

Scarlet O’Hara was exhibiting group 1 when after the civil war she was in town and met someone at a lumber yard. She instantly knew that with the end of the war there would be massive reconstruction and that would require a lot of lumber. So she knew that anyone in the lumber business would become wealthy.

Now I’m not saying that you have to be as scheming as Scarlet was, but I am saying that opportunities exist almost anywhere anytime, and it’s up to you to take advantage of them.

As I said, "great for you." I do not expect to change your perspective, but neither do I think it can be applied to the majority of people, regardless of how many "classes" of people you think exist. I made a bit of money, bought a business and had it fail during 2008 Crash. You know, the one that we bailed out the major auto makers. Too bad nobody came to my rescue. Nor does that matter. I am not so inclined to think my circumstance applies to anyone but myself. We all have different stories and what works for one is not relevant to another.

Income disparity for the general population is getting worse, regardless of how it might be for any specific individual. I have a good friend that believes as you do. His family fully funded his education and helped him start a business. When he retired, he continued to collect a significant income as an advisor. Through it all he failed to understand why everyone could not be as successful as he had become if they just worked hard enough and invested intelligently.

 

[user 22017]

Dang. White privilege

 

[Happy Camper]

If you always think the same things and do the same things you will almost always get the same results.

At this exact moment, and for some time now, I have made very little income and have scratched by barely. I made certain things a much higher priority than earning money. As long as I could eek out enough to pay bills, that was good enough, as long as my priority was taken care of. This was a very conscious decision on my part. And it's been very successful. I'm extremely happy with the outcome. For clarity, this priority has nothing to do with money or earning.

I'm not young. I'm not well connected. But I know that when it's time to change priorities (in 3-6 months), I'll switch into money making mode. I'll rely on myself, do my best to make the right decisions, and pivot quickly when I make a bad decision. In my mind, I'm solely responsible for the outcome. If I depend on government, the generosity of others, or luck for my success, I'm less likely to succeed. Climates change in business sectors. In job markets. In everything.

It's my job to decide how and where I am going to earn my money. I don't need to have laws and directions change so I can pay my rent working at Mc Donald's. It's my job to figure out how to succeed with where things stand currently. Laws, trends, large investments by business and governments, etc.

Knowledge is power. And having knowledge that works for you can help you make money. You don't have to reinvent the wheel. But you might want to modify the wheel using a material that is trending up or most likely will be.

I have to decide on what my goals are, and then go after them. I tend to have huge goals. Even if I fall short of those goals, I've most likely gone farther than setting a timid goal and attaining it.

If I succeed, it'll be because I made it work. And if I fail, it'll be because I didn't. And then I'll try again.

I'm not speaking directly to anyone here when I say this:

If you think you are a victim of external forces and don't adapt to the circumstances, you won't succeed. And yes there are times where it's extremely difficult to make forward progress. But you can do it. Unless you decide you can't.

 

[Happy Camper]

Dang. White privilege

Who said his friend was white? I have seen similar stories with Black, Middle East, Latin, Asian, and White people.

It's not a race story. It's a privilege story.

 

[mpruet]

^^^Sadly for many or most of group 2 they have no idea of how or even what with to take advantage of opportunities even if they recognize them. Our current system has failed fo give equal opportunity to many and favors very few when it arises. Look at the number of small businesses that have disappeared and the percentage of startups that fail or are barely breaking even.

This is why it is so important too continue learning after you have left school. So that if you recognize opportunities, you can take advantage of them. Way back when about the only way to do this was to read a lot (mostly non-fiction) and continue learn new things.

When I was in high school we were required to take an ‘Economics’ class. But the teacher of that class in most of the schools was not a financial savvy person. But after leaving school, I started reading a lot about finances and how I could make my money work for me. I read a lot about the impact of compounding. So I decided to try it out. I tighten up on my expenses and as my bank account grew to a certain level, I took money out a purchases a dividend oriented company stock such as the power companies and communications companies. I reasoned that I didn’t really need the income that it was providing so turned on automatic reinvesting. Then I repeated the same process.

Another thing that I learned from my studying was any time I received a bonus or a pay increase to ask myself if I really needed the new money to live on. If I didn’t, then I would immediately invest the bonus or pay increase. Oh I did keep a bit of my extra income, but never more than 1/2 of the pay raise.

Another thing that I focused on was that since I was working in technology that I needed to become as knowledgeable as I could, so I started reading a lot of books on technology. I actually made it through Knuth! I studied how to write efficient code and be quick about it as well. All of that made me much more valuable to my employers.

None of this was taught in schools. I chose to make these transitions. Truthfully it is far more easy now to become proficient in new stuff and to gain knowledge with things such as youTube and other online technology. You can even take free online classes from major universities.

 

[wanderlust]

Our current system has failed fo give equal opportunity to many and favors very few when it arises.

Dang. White privilege ... (and something against capitalism somewhere)...

This debate is PERFECT example of what we were talking about before, 90% vs 9% vs 1%. About Gini index and income inequality. https://en.wikipedia.org/wiki/List_of_countries_by_income_equality

Part of the problem is, that middle class is being squeezed, into poor and 9%. I can see how much harder it would be to my children to buy a house.

Schools are financed in a way that poor areas have poor schools with poor educational outcomes. So next generation is less capable to improve life, compared with parents (inter-generation social mobility decreases). So 9% see how easy is to fell into 90% (say, a medical emergency).

There are substantial tax subsidies to 1% (fed subsidised flood and fire insurance for nice homes in nice places, many of them *second* homes), sold to voters like help to average income family (instead of the median income).

Socialism lost to capitalism every time it was tried (so far, now China tries again), but capitalism needs to improve - improve outcomes for the whole society, not only 1%. Funny how everybody agrees that problems started in 1980'ties but Reagan was the best president. Maybe worker's unions could make capitalism more oriented for the benefit of the whole society, like in Germany. There is research that social problems are harder to solve in societies which are less homogenous, because it is easier to blame others (blacks for being poor, white males for being rich). And of course, the 1% manipulating the 9% to fear the 90% and vice versa.

No easy answers. If your answer is simple and easy, very likely it is also wrong.

 

[mpruet]

As I said, "great for you." I do not expect to change your perspective, but neither do I think it can be applied to the majority of people, regardless of how many "classes" of people you think exist.

The problem that I see is that too many folks are expecting someone or something else to improve their life situation, and that’s rarely going to happen. So they don’t do the things that are necessary to make them more attractive to potential employees. And then they complain about how unfair it is that they never had the breaks that a more successful person had.

 

[mpruet]

This debate is PERFECT example of what we were talking about before, 90% vs 9% vs 1%. About Gini index and income inequality. https://en.wikipedia.org/wiki/List_of_countries_by_income_equality

Schools are financed in a way that poor areas have poor schools with poor educational outcomes. So next generation is less capable to improve life, compared with parents (inter-generation social mobility decreases). So 9% see how easy is to fell into 90% (say, a medical emergency).

…

No easy answers. If your answer is simple and easy, very likely it is also wrong.

Maybe. But I grew up in a rather poor area - one of the rural counties in east Alabama. And with today’s technology there is no reason to be limited by the schools in your area. You have access to the world’s knowledge at your finger tips.

 

[wanderlust]

Maybe. But I grew up in a rather poor area - one of the rural counties in east Alabama. And with today’s technology there is no reason to be limited by the schools in your area. You have access to the world’s knowledge at your finger tips.

Yes. I agree with you. But Gini index in USA increased significantly since 1980, and social mobility decreased. And being able to access all the opportunities is also not easy - for top 10% it is, but is harder for the rest.

 

[mpruet]

Yes. I agree with you. But Gini index in USA increased significantly since 1980, and social mobility decreased. And being able to access all the opportunities is also not easy - for top 10% it is, but is harder for the rest.

Do you think it was better in the early 20th century when the Vanderbilts, Rockefellers, Carnages, Morgans, Guggenheims, and Fords held the majority of all wealth in the world?

 

[bullfrog !]

The problem for younger people is getting started and having you and your family’s basic needs met til you can make enough income to invest. Gaining knowledge take time which is something you have very little of if you are poor and working. Finding money to risk on investments while your family is starving ain’t gonna work. Unless you are very successful at earning money you will have a hard time making enough to keep a roof over your head, one medical bill can wipe you out, one car repair and lots of other obstacles but it is possible but more probable if the obstacles are minimized. We shouldn’t have the number of children we have living in poverty. This has caused a generational problem in my opinion which has now carried over into older generations. Lots of people still trying to overcome poverty without enough for even basic necessities waiting to try to get an empty bed in any nursing home. My parents worked hard at good jobs for more than 35 years but made bad investments in stocks and lost most of their funds but still by living simply managed to save and use what resources they had to barely manage care costs until Medicaid was obtained. Lots don’t do as well as they did. Anyone that has been in poverty areas has surely noticed the ones that didn’t. It is getting pretty easy to see in almost any community.

 

[mpruet]

The problem for younger people is getting started and having you and your family’s basic needs met til you can make enough income to invest. Gaining knowledge take time which is something you have very little of if you are poor and working. Finding money to risk on investments while your family is starving ain’t gonna work….

Guess what the majority of the meals I had when growing up were…

Answer: Cornbread and back-eyed peas.

There are lots of ways to reduce food expenses and going to Mickey Dee’s isn’t one of them.

 

[bullfrog !]

I agree but it is tough when you have babies, they tend to choke on cornbread and it takes money even to buy black-eyed peas as most places don’t have a good enough climate or soil to grow enough high yield beans to keep a family fed. Not every place has a good private charity food bank. It also takes transportation and or fuel to get to the grocery store. Lots of isolated areas in this country and large urban areas without grocery stores. In many areas unfortunately McDonald’s maybe the closest and cheapest food available, especially if you dumpster dive. Just look at the numbers of kids whose only meal is the free school lunch program.

 

[user 22017]

Who said his friend was white? I have seen similar stories with Black, Middle East, Latin, Asian, and White people.

It's not a race story. It's a privilege story.

Wasn't referring to his friend, LOL.

 

[user 22017]

I'm not speaking directly to anyone here when I say this:

If you think you are a victim of external forces and don't adapt to the circumstances, you won't succeed. And yes there are times where it's extremely difficult to make forward progress. But you can do it. Unless you decide you can't.

Define success. It means something different to everyone. Unless, of course, you mean money.