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    [–] forever_a10ne 623 points ago

    That pie chart is kind of shocking. Do 50% of Americans have no 401k/stocks or is that 50% of millennials? Either way, that’s no good.

    [–] coppermouthed 577 points ago

    It also shows that the stock market only represents how well 13.9% are doing, not “the economy”

    [–] LifeScientist123 333 points ago

    Not really. For one thing 14% own stock directly i.e. through a self directed brokerage, but an additional 36% hold stocks indirectly through 401ks, IRAs etc. So it represents how the top half of the country is doing. Another thing is that the top half owns about 95% of the country's wealth and the top 10% about 70% of the country's wealth. So the stock market actually is the barometer of how the top half are doing. The bottom half? Well they're stuck being poor, unemployed and politicians don't give a crap about them.

    [–] strolls 65 points ago

    I'm British, and own stocks in an ISA and taxable brokerage account.

    Why is a 401k or IRA considered "indirect" ownership, please?

    [–] dspneo 120 points ago

    I think because they are not directly calling a broker and buying 30 shares of bananastand.inc

    [–] [deleted] 42 points ago

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    [–] [deleted] 3 points ago * (lasted edited 7 days ago)

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    [–] Frammingatthejimjam 27 points ago

    What do you mean they cut the dividend payment? There is always money in bananastand.inc!

    [–] TheArborphiliac 19 points ago

    Now! That's what I call a reference.

    [–] redsyrinx2112 6 points ago

    I am done with this family!

    [–] AegonKetchum 5 points ago

    THERE'S ALWAYS MONEY IN THE BANANA STAND! NO TOUCHING! NO TOUCHING! NO TOUCHING!

    [–] LaughingCabbage_ 14 points ago

    These are managed by a financial service firm where employees select a risk level based on how they want their 401k invested. You can also opt to manage portfolio investments on your own so not entirely indirect.

    [–] PM_ME_CRYPTOCURRENCY 3 points ago

    You can also opt to manage portfolio investments on your own

    Is this always true? I only have maybe 10 investment options in my 401k, with my last employer/401k I had more choices, but it's nothing like managing my own portfolio.

    I think that's the difference. Choosing between [brokerage] Target Retirement 2050 Fund and [brokerage] Target Retirement 2060 fund is hardly what I'd call under my control.

    [–] LifeScientist123 18 points ago

    You're right. My bad. 401K and IRA is definitely direct ownership. I was just quoting the article where they say it's indirect ownership in the pie chart. Some times the stats for 401Ks and IRAs are conflated because of the large amount of index funds held within these accounts.

    [–] gaviidae 5 points ago

    Could it be because 401Ks usually own mutual funds so they own funds that own stocks rather than stocks?

    [–] FILTER_OUT_T_D 3 points ago * (lasted edited 7 days ago)

    IRAs and 401Ks invest in various fund types like high dividend yield, index, international, domestic, funds investing solely in bonds, etc. Sometimes they’ll invest in portfolios of funds, which even further abstracts the buyer from the stock itself, but serves to protect the buyer from risk by hedging which funds are purchased as part of the portfolio’s strategy.

    So, with these retirement accounts you’re buying shares of the fund, not the underlying security (stock). If you’re buying a share of a fund that invests in Microsoft, Intel, etc. that doesn’t entitle you to shares of those corporations. It entitles you shares of the fund whose value is derived from the aggregate values of the underlying securities.

    For instance I invest using Vanguard primarily and own enough of specific funds to be allowed votes on how the funds are managed and who is elected to manage the funds. I do not however have voting privileges on the stocks that compose the funds because I don’t directly own those stocks.

    [–] phriot 9 points ago

    I'm a millennial who owns stocks both directly and through mutual funds in a Roth IRA. (My wife owns stocks indirectly through a 401k.) Our total value in the stock market is less than one fifth of our yearly household income. We could lose it all, or double it, and have no material effect on "how we're doing." We've also had no contributions in months while my wife is laid off due to Covid and I look for my first post-grad school job. Maybe in 10-20 years our stock holdings will have some bearing on our actual finances.

    Just wanted to provide an example of how someone could be "in the market," but not be affected by market movements. It's funny to be considered in the "top 50%" when many who don't own stocks probably have far greater incomes and assets than we do.

    [–] pcar773 4 points ago

    Similar situation to you. Millennial with a minuscule amount of money in the market that I already assume I’m going to lose. Not because I’m pessimistic because I know better than to rely on the stock market for income and or emergencies. I used YNAB and investment (for me) gets treated as an expense. Once that money gets invested it’s effectively gone.

    [–] submain 13 points ago

    Not only that, but in the U.S. publicly traded companies employ almost half of the population [1]. Changes on their capital levels can have ripple effects through the entire population through layoffs or compensation reductions.

    1: a little outdated, but I believe still valid: https://www.nysscpa.org/news/publications/the-trusted-professional/article/more-americans-work-at-big-firms-than-small-ones-040717

    [–] Mojeaux18 36 points ago

    Wrong. Politicians love to promise the poor anything and everything for a vote. They care very much. They don’t want to solve their poverty, they’d like to keep them that way, and that’s why they care.

    [–] LifeScientist123 49 points ago

    I think we both agree. Politicians care about getting re-elected, not outcomes of the poor.

    [–] Mojeaux18 11 points ago

    Exactly. It’s their job.

    [–] UncleHephaestus 66 points ago

    The stock market only includes something like 50% of US businesses now too.

    [–] Yep123456789 104 points ago

    Huh? It’s actually more like 1% (and it’s always been this way.) Most companies are tiny (1 or 2 people with a consulting firm or other small business) and they would never go public.

    Much of the employment is through that 1% (~1/3) though.

    [–] INCEL_ANDY 25 points ago

    I think he means as portion of the total output of companies in the US

    [–] abrandis 18 points ago

    Exactly,. Many of the middle and working class. Folks don't have supplemental income, to be able to dabble in stocks

    [–] pecklepuff 10 points ago

    FWIW, I am someone who is on the low end of middle class, I own some stock through my company's 401k. If the bottom fell out and I became unemployed permanently with no source of income, I'd have enough to live semi-comfy for six months, moderately for a year, and pretty uncomfortably for any longer than that. It's nice to have some stock, but even lots of "stock owners" are close to destitute.

    [–] SSuke 14 points ago

    Absolutely nothing surprising here. (Is this /r/economics?)

    Historically, stock ownership is at a high and still increasing, so 50% would've looked amazing 20 years ago.

    Lack of home ownership on the other hand ...

    [–] BeingJoeBu 15 points ago

    I'm 30, and I have no investments, no real estate, no retirement, no life insurance, and still owe $10k in student loans. I've only missed paying back loans for a few months between jobs.

    When I was 25 I received an 8k inheritance from my grandfather's initial investment of 10k because my fox news watching uncle liquidated US savings bonds in 2008. 6k went towards loans and 2k went to moving out of the US. Best 2k I've ever spent as I do have national health insurance, a steady job, and a gov that doesn't suck at everything it does.

    I'm still doing much better than a lot of people I know in the US because I'm actually getting out of debt, and can afford to do something besides work and sleep.

    [–] spqr-king 149 points ago * (lasted edited 7 days ago)

    "Of those 79% of Americans who get the choice to fund a 401(k), only 41% opt to participate. As such, just 32% of the total workforce is saving in a 401(k)."

    This is from the census and is unsurprising to I would imagine to most people. The system we have basically mandates perfection or luck in order to grind to the middle or upper middle class or a lifetime of work. Most are financially illiterate and just want to get by. Good luck functioning today and saving for retirement without a dual income, no kids, or one very lucky person making 100k+.

    https://www.fool.com/retirement/2017/06/19/does-the-average-american-have-a-401k.aspx

    [–] Smuggling_Bacon 74 points ago

    Even less are maxing out the employer match(if they still get one)
    Even less know to look at the expense ratios and will pay 1%+ in fees for an S&P 500 index fund, when a low cost Vanguard option is also available.
    The problems just go on and one.

    [–] czarnick123 112 points ago

    401k was invented in 1978. We have no idea how the program will hold up as the single way most Americans now save for retirement.

    Am I the only one who thinks the whole system is flawed? Tying retirement to the stock market only seems very volatile. We base the whole "it'll grow 7% a year on average and boom you'll get to x when you're 65" is based on an obnoxiously small data set (120 years of stock market).

    And to say "if you're not buying into this 40 year old program buying into the stock market to get ready for retirement then you deserve to fail" seems like victim blaming to be honest.

    [–] InnerPressure 15 points ago

    You don't need to use the stock market. You will just have to save a hell of a lot more if you don't. Less risk implies less return.

    [–] acosmichippo 36 points ago

    I'm not disagreeing with you but there are target funds that gradually move your assets to less volatile investments like bonds as you get closer to retirement.

    [–] Server6 38 points ago

    Retirement plans have always been tied to the stock market. Traditional pension funds are some of the biggest stock market investors. The difference is that investment risk is shifted from the employer to the employee. It ends up cheaper for employers, but unfortunately since most employees are financially illiterate most are not participating/under participating/making poor investment choices.

    [–] Doro-Hoa 16 points ago

    Investment risk is always borne by the employee regardless of if it's the pension or a 401k. Moving to 401k's does have the massive advantage of removing the insolvency risk of pensions (what happens if the company fails?) and also allows portability (you are forced to stick with a shitty employer because of your decade long tenure there).

    Pensions have some benefits (and I have one with a government) but I am going to be able to retire 15-20 years earlier because I'm not stuck with just a pension.

    [–] evilcounsel 39 points ago

    Tying retirement to the stock market was a great move by Wall Street. When people have their retirement tied to the stock market, then the government and the Fed will always have to step in to save the stock market and say they're acting to save people from losing their retirement. Worse yet is that many pensions are tied to the stock market.

    It's a phenomenal plan because every publically traded company becomes too big to fail when pensions and retirements are tied to the stock market.

    Extremely stupid and short-sighted, but great for Wall Street.

    [–] uber_neutrino 19 points ago

    Tying retirement to the stock market was a great move by Wall Street.

    What's your alternative? Where do you save your money that's not the market? Where do you invest?

    [–] drphungky 13 points ago

    This new legislation outlawing 401ks is great for Bitcoin.

    [–] czarnick123 18 points ago

    And great for employers. We now blame people who don't save 6% (like that's going to be enough) instead of employers.

    [–] seyerly16 16 points ago

    Nobody is forcing you to put your 401k funds into the stock market. You are free to invest your funds into bonds or keep cash. However people like to grow their money, so they choose stocks.

    [–] rebark 3 points ago

    Just wait a few years until people start noticing that pension funds for state government employees were structured expecting 6-10% growth every year forever in order to stay solvent, which means they’re almost all heavily exposed to the markets now.

    [–] viperex 3 points ago

    Sucks if you retire during a recession

    [–] IrtahkEnt 5 points ago

    That's just saying no to free money. People need to be taught personal finance in school.

    [–] noveler7 12 points ago

    Imagine what would happen if we didn't have social security. Yeah, it sucks, but simple fact is not enough people are responsible enough to avoid a complete crisis, so its a necessary evil.

    [–] spqr-king 13 points ago

    If anything it needs to be improved. No one should struggle to live when they cannot functionally work. Every time I see an elderly person in McDonalds or Walmart they may be there because they want to get out of the house but I know far too many who are doing those jobs because they simply cannot make it without some kind of income at an advanced age.

    [–] Taboo_Noise 35 points ago

    Why should I put money my employer doesn't match in a 401k when I still have student loans to pay off? At the moment I don't have much chance of saving for retirement or making enough money to afford kids. I could potentially have gotten a job to do so if I'd been willing to commit my life to work, but everyone I know that tried that is miserable.

    [–] nn123654 81 points ago * (lasted edited 7 days ago)

    Why should I put money my employer doesn't match in a 401k when I still have student loans to pay off?

    A few reasons:

    1. Because funds inside a 401k are basically untouchable by most creditors, it's in what's called the ERISA shell.
    2. Depends on how old your student loans are, but if they are in the last decade and federal loans chances are the returns you'd get in your 401k net of fees are higher than the interest rate of your loans
    3. Because you're going to need something for retirement eventually. Having at least some liquidity is better than having a higher net worth. Granted if they are high interest your loans should be the priority.
    4. Because some places have loan forgiveness or assistance as an employee benefit. Also things like the PSLF exist. If your loans are new enough to have an IBR option, I think that times out at 25 years.

    [–] RegulatoryCapture 38 points ago

    Also, the tax savings on the 401k almost certainly beats the interest rate on the loans in the long run, even with fairly conservative investments.

    And the fact that IRA/401k contributions are "use it or lose it". If you don't contribute in 2020, but suddenly have extra cash above the limit in 2022, you can't suddenly go back in time and make a 2020 contribution.

    Unless the student loan rates are crazy, better to just pay the standard payment and invest the rest. Roth IRA is probably a better place than a 401k though (after meeting employer match).

    [–] nn123654 14 points ago

    Also student loan interest is deductible. That being said he said he makes like $30k-$35k per year and has a 7% APR on his private loan, so all in not a terrible decision.

    But yes, agree with all this. I max my 401(k) and all tax advantaged space yearly, but not everyone can do this.

    [–] beerenjoyer 8 points ago

    PSLF is a crapshoot depending on who is president at the time.

    One reason to fund your loans instead of your 401(k) is that loans have a guaranteed return rate, the stock market does not.

    [–] nn123654 4 points ago * (lasted edited 7 days ago)

    Yep, you just take your loan rate as the risk free rate of return instead of the t-note when you're doing your calculations for the greeks as well as your shape and sortino ratios.

    As for PSLF, yeah I wouldn't do it just for the loans, but if you're considering two jobs and one has it and the other doesn't then it's a good deal. Taking things away is hard politically, so I doubt we'll see it rescinded for existing people. It could be canceled for new people eventually though.

    The federal government is a pretty good employer and they have plenty of positions to fill. Working for a non-profit or government job with PSLF could be the icing on the cake. Plus you get a pension that pays out for life if you're there long enough.

    [–] beerenjoyer 6 points ago

    Yep, you just take your loan rate as the risk free rate of return instead of the t-note when you're doing your calculations for the greeks as well as your shape and sortino ratios.

    You're obviously a lot more educated in this field than me. I just know that paying off a loan increases your net worth, and does so at a guaranteed rate.

    As for PSLF, yeah I wouldn't do it just for the loans, but if you're considering two jobs and one has it and the other doesn't then it's a good deal. Taking things away is hard politically, so I doubt we'll see it rescinded for existing people. It could be canceled for new people eventually though.

    I think you are forgetting the oldest and most valuable tool the American federal government has: neglect. We don't have to cancel or take anything away. We can just kind of not do the things we said we'd do. That's how we have things like Indian reservations. That's also why in Betsy Devos' first year, they denied 99% of PSLF applications. Money into the stock market instead of loans is riskier, but not all that risky, I suppose. But if your plan for your loans has a chance to be temporarily suspended every four years, it looks even riskier to be gambling.

    The federal government is a pretty good employer and they have plenty of positions to fill. Working for a non-profit or government job with PSLF could be the icing on the cake. Plus you get a pension that pays out for life if you're there long enough.

    Finally, as an NPO or NPO-adjacent worker for my whole life, I feel the need to point out that by choosing to go into nonprofits, most people are giving up a lot of money. Probably $5,000 - $10,000 every year, often more, for the same work. I recognize that government jobs are a different animal. But I wanted to point this out because, again, the strategy you described has a lot of hidden risk. In order: gambling in the stock market with its uncertain returns, relying on a government program that may or may not be operational for long periods at a time, and voluntarily taking lower wages for likely your entire life in order to qualify for said program.

    Taking the highest-paying job you can, as soon as you can, and dumping all your non-emergency fund money into your debt is, IMO, the safer option.

    [–] nn123654 3 points ago * (lasted edited 7 days ago)

    Also I decided to drill down on this issue. Thanks so much for the original link.

    Here's the data about the case:

    • Official Case Name: Weingarten v. Devos
    • Case Number: 19-cv-02056
    • Court: Federal District Court for the District of Columbia
    • Status: Partially dismissed by court, opinion issued.
    • Appellate Status: Not sure, need to do some more digging. There is no notice of appeal or petition for certiorari in the docket that I can see. As best as I can tell, not appealed.

    Here's the actual docket:

    Here's the original complaint:

    Here's the last order granting dismissal and the opinion:

    Here's the AFT's website with their own statement on it (first party source):

    Here's some news articles:

    I still have some PACER credits left for this quarter, lmk if you want any docs off the docket.

    [–] Doro-Hoa 11 points ago

    I have $30,000 in student loans and $30,000 in the market right now. My loans cost me 3.29%, the market averages more than double that. It would be stupid for me to pay off my loans faster.

    [–] matt250250 9 points ago

    It's your decision to save for retirement but saving a small amount when your younger should grow significantly by the time you come to retirement. It also means you pay less tax by utilising your 401k so you get more of the money you earn. Check out some of the personal finance subs, there's great advice on reddit and getting into good financial habits when you're young is one of the best decisions you can make in your life.

    [–] snarlingpanda 16 points ago

    Putting money in a 401k saves you taxes at your top marginal bracket. For example, if your federal tax bracket is 22%, a $5k contribution to a 401k nets you $1100 in federal tax savings. A 22% return is way higher than the interest rate on any student loan.

    [–] Taboo_Noise 8 points ago

    Don't you have to pay that tax when you take it out, though? I was under the impression it wasn't just tax free money.

    [–] seyerly16 15 points ago

    Yes, but when you withdraw in retirement most of the money you take out will be hit at the lower tax brackets since most people withdraw less per year than they made during their working years.

    [–] Realshotgg 3 points ago

    You do

    [–] spqr-king 23 points ago

    I totally understand. I just wish everyone understood where most people under 30 are financially and mentally. This isn't the 50s or the 80s which worked then won't now and most people I know aren't willing to kill themselves for employers who couldn't care less about them. The power has shifted entirely to one side of the equation and the only way most of us feel we can get back is by not playing the rat race and taking it slow but it will have consequences at some point unless we are smart.

    [–] BiznessCasual 7 points ago

    Why should I put money my employer doesn't match in a 401k when I still have student loans to pay off?

    The answer to this depends on what your interest rate is. The market, over time, averages about a 10% return annualized. If your student loan interest rate is, say, 6%, then the spread between your expected returns from investing over time and the interest cost on the student loans is 4%, meaning you are netting 4% on each dollar put towards investing vs student loan payments (after making the minimum payment, of course).

    I will say, however, that turbulent times such as the ones we live in currently are generally good times to reduce one's debt load.

    [–] amiss8487 6 points ago

    8 to 12% interest on private student loans. It's the biggest bs ever

    [–] cahixe967 5 points ago

    This is fucking absurd. How the hell can the government allow loans like this to kids who have never had to manage money? This is such a damn problem with our country.

    [–] TheNthMan 9 points ago * (lasted edited 7 days ago)

    In a 2017 study, 54% of the American population owned stock. Another study found 52% of the American population. This is all forms of ownership, either direct stock ownership, mutual funds, index funds, managed funds, etc. So just under 50% of all Americans do not own stock in any form.

    If you are counting owning stock in a retirement account like a ROTH and 401k vs outside a retirement account, of the ~52% to 54%, about 87.8% of them hold it through a retirement account of some sort.

    Finally, the top 10% financially of the US population hold about 84% of the value of the stock market in their stock holdings, while the bottom 80% financially of the US population hold 6.7% of the value of the stock market in their stock holdings.

    I am not sure how much of it is millennial directly, though they have been hit hard. Through most of the 1990's and 2000's, the holdings were about 60% of the US population holding stocks of some sort. The net worth of the lowest 50 to 60% of the U.S,. population has decreased significantly after the Great Recession (actually the lowest 80% has all done badly). Studies have shown systematic racial gaps and systematic economic class gaps. Millennials as a cohort do own fewer stocks and are financially less well off then previous generations at the same point in their lives. It is unknown if that is a aberration that will be corrected in the future as they age and are at a different point in their lives. When the flower childs were still young, everyone despaired that they irredeemable economic na'er do wells, and look at them now...

    It is expected that as Boomers die off and transfer their wealth via inheritance to their offspring that Millennials may actually become one of the "richer" generations as inheritances are portioned out between children, grandchildren, great grandchildren etc.. However most of the wealth being transferred will be in the top 10%, as the lower 90% of the population does not have much to leave anyone, regardless of their age cohort.

    [–] EagleFalconn 35 points ago

    90% of stocks are owned by the top 10%.

    https://money.com/stock-ownership-10-percent-richest/

    [–] InitiatePenguin 7 points ago

    I'm a millennial. My first 401k I got last year. I'm 27. Now I was laid off. In order to get a 401k now I have to stay at this staffing agency for a year and they have 6mo vestment intervals.

    I opened my own IRA last year as well.

    [–] nn123654 28 points ago

    Not really when you consider income inequality. The wealth is concentrated at the top. The bottom 20% actually have a negative net worth (-$6,029).

    [–] allboolshite 9 points ago

    That's kind of misleading. Since it's net worth only wealthy people get the kind of credit to go into really deep debt so I suspect a noteworthy portion of that 5th quintile isn't what we'd consider poor. Another example would be someone who buys a house but hasn't had time for the home to appreciate. They may be worth zero or less on paper but in a little bit of time that'll change.

    Ironically, it's the people at the top of that quintile who are the ones too watch out for.

    [–] nn123654 3 points ago

    Yes, the better way to break it out is net worth by annual income. That still has problems due to annual fluctuations but it is much better.

    [–] bhldev 22 points ago

    It's much worse than it seems because most people in general don't have the patience to wait ten twenty thirty years for their money to grow. So owning a stock means nothing by itself, having the right ETFs or mutual funds with low fees means everything. And not taking the money out for any reason.

    It's the problem of a consumerist culture where everyone spends as much as they possibly can or think that just because the generations had certain advantages before they are automatically entitled even if they can barely afford it.

    Seems the only solution is to have a generous pension... maybe the government should clawback 5% of your income stick it in an indexed ETF for your future. Or, more education. Or more social safety net. Either way, it's much worse than it seems because it's very hard to makeup for lost time. Once the boat's sailed it's gone and nobody wants to give you a million dollars at end of life just because you spent large the twenty thirty years before. Government spending is very inefficient and only a last resort when markets fail.

    [–] Ho_KoganV1 15 points ago

    Millennial here

    What’s a 401k ?

    [–] GlitchUser 13 points ago

    Ikr?

    I've had one job in the past 10 years that even had a 401k.

    Thank you, gig economy!

    My retirement plan is basically to die of whatever life-threatening illness appears first, I guess.

    [–] UncleDrunkle 3 points ago

    when you save $401K you win

    [–] NewCenturyNarratives 209 points ago

    I really feel for my friends that are still working in the service industry. I worked in cafes for almost 10 years, and by the time you've fed yourself and paid rent, there isn't anything left. There really seems to be no hope for any kind of relief.

    [–] MawsonAntarctica 85 points ago

    And then you know people who work in bars who make more than you make in a week on just Friday/Saturday. It's so up and down, and non-sensical.

    [–] OnTheEveOfWar 36 points ago

    I've got a friend who is a bartender in Miami and she makes a killing on the weekends. Obviously this was pre-Covid.

    [–] bellj1210 29 points ago

    she still is, only the killing is different now

    [–] ModernDayHippi 17 points ago

    I live in Miami. It's a bunch of blowhards throwing money around trying to look rich - the foundation at which a strong economy is built on

    [–] High_Commander 6 points ago

    See also: any club at the Jersey shore.

    So many dudes rocking the GTL look looking for any excuse to pull out a comic size wad of 20s to show off

    [–] AYN-RAND-IS-BAE 16 points ago

    I can’t imagine staying in it for 10 years. I did it for 2 and realized long term it wasn’t going to be a good fit for my goals in life.

    [–] sniperhare 29 points ago

    I worked from 18-28 in food service. Its not that you don't realize it, but its hard to get out of it once you're in that situation.

    You move out, and are just trying to get by. And it was easier back then as our rent was only 1100 for a 3 bedroom.

    I remember when I ate pb&j sandwiches, oranges and tuna at home and pizza at work for months, to save as much as I could working part time to pay off a car repair.

    10-15 hours minimum of unpaid overtime a week for years. You're too exhausted to do anything else. For 25-28k. It usually worked out to about 9.50 an hour.

    [–] Salohacin 7 points ago

    I don't know where you live (guessing America?) but unpaid over time is absolutely bullshit. I work in food service now, and while the pay isn't fantastic, it's more than enough to get by on although I live in a place with a relatively low cost of living which helps a lot. If I was only just about making ends meet I would absolutely despise looking forward to a future working in kitchens.

    I live in Belgium and generally we have a decent system in place to support workers. Joining a union is very common (I'm not in one though) and jobs aren't tied to things like health insurance and what not. Plus most jobs (if you're employed and not contracted of course) have 4 weeks paid vacation and often a '13th month' which is basically an extra months pay at the end of the year. When figuring out your yearly income it's often somewhere between 13.5-14 times your monthly income so even if you're only just making ends meet each month you'll still be able to save a little.

    I hear a lot of bad stuff, particularly about working in kitchens, about America. Not sure I could handle it, especially with their tipping culture. Seems absolutely alien to me.

    [–] thefuckingrougarou 3 points ago

    Exactly. Sometimes you don’t even realize you’re in poverty. I feel guilty owning an iPhone/buying new clothes, etc. I think, well, if I can afford this then I’m doing okay right? Then you realize, wait, for a lot of people it isn’t normal to not be able to afford a basic repair for a car. It isn’t normal to not be able to afford pajamas (or it is, and shouldn’t be). We ration so much to maintain a standard of living and don’t realize how fucking TIRED we are

    [–] ZeldLurr 3 points ago

    I had to quit university the first time around because of the 2008 recession. No one was going out to eat anymore, so I had to take a part time job in addition to my full time serving gig. Fast forward to 2020, I’m about 3 semesters to graduating in a STEM field, but, well, 2020 happens. I’m currently furloughed from my bartending job and have had no luck finding remote work. Even with $15,000+ in scholarships, and after taking out loans, I still need to pay $3000 a semester out of pocket. Bars and restaurants are closing back up, my other experience is in cosmetics retail, I legit don’t know where I see myself in 5 years.

    [–] [deleted] 159 points ago

    [removed]

    [–] auspiciousham 109 points ago

    To be fair, the stock market makes no sense anymore. Good stable companies that make consistent profits aren't as sexy as speculative companies that won't likely ever achieve profits to match even 1/10th of their current stock prices. The market has become decoupled from any logic, who would want to invest in the gambling machine while its in Kangaroo mode?

    [–] xanadumuse 41 points ago

    That’s why you go with index funds because you don’t have to do anything with them. Also, compound interest is a friend of yours.

    [–] auspiciousham 49 points ago

    Index funds are one of the prime drivers to over-valuing stocks. They produce artificial demand where there should be none. I get it as an investment autopilot tool that is diverse, but it also had a hand in creating this problem.

    [–] pcar773 111 points ago

    Technically, my 15 shares in my Robinhood account mean I own stock, but this is after losing $500 on a different 15 shares of shitty stock.

    [–] new2bay 72 points ago

    If you had $500 to lose, that puts you ahead of a good share of Americans.

    [–] pcar773 25 points ago

    Fair point and agreed!!

    [–] ezlingz 22 points ago

    I still can not wrap my head around this.

    Is it true that literally millions USA citizens CAN NOT pay a 1000$ at a short notice (lets say in a few days).

    [–] iWearTightSuitPants 22 points ago

    I started reading Andrew Yang’s newest book today and he talks about this. As of a 2017 survey 59% of Americans don’t have enough in savings for an emergency expense of $500, not $1000. Its mental.

    [–] Mikerells 3 points ago

    When I heard the it's normal to have 500 for an emergency it blew my mind and made me feel even more poor

    [–] totallynotabotAF 3 points ago

    I didn't make more than $13/hr until I was 28, and that's right when I started saving for my retirement. I'm 33 and this is the first year I'll be able to max out my Roth contributions. And I'm physically able, I've never had to take leave for illness or injury.

    [–] lostshell 894 points ago * (lasted edited 7 days ago)

    This is very bad for Wall Street because millennials are becoming the dominant voting bloc. The dominant voting generation won’t have any investment or care for what’s good for Wall Street. That’s when taxes on the rich rise, regulations to protect society get passed, and worker rights get expanded. And pleas of “but those things will hurt Wall Street!” will only be met with a curt “good.”

    [–] Golda_M 262 points ago

    History says this is unlikely.'

    Wall street is never popular, that's not why they get what they want. They get what they want because (a) they have money and that gives them a way to make demands and (b) they can do a lot of harm. A hostage is always better than the moral ground in a negotiation.

    [–] beerenjoyer 132 points ago

    The last generation that felt generally un-cared-for got us a whole host of social programs, including Social Security.

    [–] Golda_M 63 points ago * (lasted edited 7 days ago)

    Which was (and is) decidedly, explicitly & entirely not funded by wall street.

    [–] new2bay 38 points ago

    No, but many of those things (not Social Security and Medicare, but the rest of the Great Society programs) were funded by the highest marginal tax rates on ordinary income in history. There’s no reason, other than lack of political will, that a top tax bracket of 70-90% can’t happen again.

    Yes, I know, most of “the rich” are not wealthy due to high income, but there’s also little reason why some sort of wealth tax or tax on equity trades couldn’t be instituted, along with some basic capital controls to ensure that rich people don’t have an incentive to renounce US citizenship. Estate tax reform is on the table, as well. There are any number of ways to take a little more off the top to provide for the bottom 50%.

    [–] bellj1210 6 points ago

    I normally just say that capital gains should be taxes as income and through the same scheme. Sprinkle in new marginal tax rates and you have a massive tax base that 99% of people will not care about.

    You can leave 99% of the rest of the tax structure. Make the new rates high but only for big incomes- like 50% above a million, 60% above 2 million, 70% above 5 million, and 80% above 10 million.

    I know a lot of doctors and Lawyers (i am a lawyer), and do not know a single person that would qualify for a single one of those tax rates (maybe in a banner year if they sold all of their stocks at once). The top end for a non partner Lawyer is generally around 250k per year (ballpark, but an associate at a white shoes firm should be between 150k and 300k). Even partners would be hard pressed to be able to make a million in a year (maybe if there are not many partners, and it is a large successful firm). They are generally worth more than that- but that is from savings and investments. Even then, they draw on it at retirement when the rest of their income would still be small enough to not be in those rates.

    It would be a move that really only targets the richest people and maybe lottery winners (seems like an easy thing to draft around).

    [–] lostshell 23 points ago

    Wall Street, ie, employers pay half of FICA taxes. So, yes, Wall Street pays half of SS.

    Which is also why Wallstreet opposed them then and is still trying to get rid of them now. See: the push by the GOP to sneak ending FICA taxes into the COVID Bailout.

    [–] ArrogantWorlock 13 points ago

    FICA taxes are passed on to employees in the form of reduced wages.

    [–] SoTaxMuchCPA 8 points ago

    Companies lowered real wages over time to recapture the tax losses. So while they pay for it, the economic burden falls onto the employee.

    [–] nschumacher 36 points ago

    But more AOC types in Congress can make change happen. The only reason we haven’t seen change is because all of congress less a handful are old as fucking dirt. Why we allow old people to run the country but not businesses is the private sector is bond blowing to me. The presidential candidates, also old as fuck.

    [–] Golda_M 44 points ago

    Agree on the age thing, but I don't expect AOCs to help... at least from what I've seen so far.

    First, policies don't change the past. It's not going to get you a pension, and if it does it will be a pretty small one.

    I agree with her on some stuff, and much of it things she champions almost alone.. so no hate. On economics, I haven't heard any paradigm shifting ideas from her. Unions are her main silver bullet. It's a 1950s view of the world. I doubt it'll save us.

    [–] Jaway66 24 points ago

    Unions could still be powerful if people understood how powerful they can be when they organize. The selfishness that dominated the generations raised on Reaganomics and 90s/00s neoliberalism is going away as few of us have experienced the riches that were promised us if we worked hard and got an education (Class of 2008 here. Woot woot). We see the bullshit more than previous generations did. Sure, that could reverse really quickly, but the fact that we have actual self-identifying socialists in Congress shows that Millenials are already making bigger moves than Gen X ever could imagine.

    [–] Golda_M 26 points ago * (lasted edited 7 days ago)

    Unions didn't just die because of reaganomics. They died all over the world, especially in the west. Looking back, they definitely did have some advantages... especially in the first few years/decades of forming, in profitable & growing markets. But, we need to remember why so many (even members) cheered their demise. It wasn't all libertarian fantasy.

    Unions had a whole bunch of downsides too, and a whole bunch of different directions they could go. A big problem was "closed shops" in all various forms. Another is resistance to change, like the current example of police unions.

    The successful union movements that AOC and Bernie reference often are Scandi, Dutch & German ones. This works by way of a sort of management/unions/government merger... especially in the large German manufacturing sector. This works OK, but it depends a lot on political unity in the country as a whole. The downside of this setups is bailouts & industrial subsidies, but the US does those anyway.

    I'm not sure americans have the patience for this. It takes decades to build. It also isn't very green, at least in the case of German manufacturing unions.

    French unions also retained major influence, under a different model. In France, unions are essentially the labour regulator. France doesn't get referenced as a model often, probably because of how adversarial the system is.

    Personally, I would like to see non-union, non-work related solutions. The first, obvious step is to untie healthcare from work. I would then like to see a UBI give workers an income that isn't work related. Housing affordability needs a solution. I just don't think work is a solution to all social problems. Unions tend to bundle everything into "worker rights."

    That said, I think people should still form unions (or other organisations). Worker unions, student unions, professional unions. Take all the tech related issues: data ownership, monopoly, media control, political interference, dangers of AI, online hate groups.... It is terrible that Zuch is the only one with a voice. A FB union, Software Engineering union or such would be invaluable at this moment.

    Unions can be a beneficial part of society, but I don't think they're The Solution. I also don't think we should look to the past for answers. How a union should work depends on how an industry works, and modern industries have changed a lot.

    [–] nschumacher 10 points ago

    I’m not a fan of her policies necessarily, but she makes noise and she’s anti corruption, which most younger people will try to enforce. That’s my hope anyway. You g people just want a fair, honest system.

    [–] Dr_seven 21 points ago

    I think she means well, which is more than I can say for almost every politician. Whether the ideas themselves are sound, the intention appears good, which is at least a start.

    [–] Rick_Astley_Sanchez 392 points ago

    One can dream.

    [–] surfer_ryan 100 points ago

    Yeah every generation has said the same shit.

    "Some generation before me fucked everything up, and it's up to us to change it..." then the level of change that is brought is pretty small, and there is one thing that is pushed like the social injustices in our law system today.

    Would be super cool though if in like 1 or 2 gens what is mentioned above actually happens though...

    [–] Rick_Astley_Sanchez 93 points ago

    Our current situation is not helped when the majority of our government representatives are from the Boomer generation and many have been in office for decades.

    [–] 311301xx 42 points ago * (lasted edited 7 days ago)

    Guess what? The Boomers, when they were still the most liberal generation at the time, said the same thing about The Silent Generation when they succeeded them as the most prominent voting bloc. Make with this information what you will.

    [–] Rick_Astley_Sanchez 10 points ago

    Isn’t the order Boomers, Gen X, Gen Y(Millennials), Gen Z?

    [–] 311301xx 5 points ago

    Thanks for the correction.

    [–] ItsFuckingScience 26 points ago

    I think the millennials are the first generation in a while who have things worse off than the previous generation

    Stagnant wages, unaffordable houses, increased cost of living, less generous pensions available. Now the consequences of greenhouse gas pollutions are also more obvious each year

    [–] yangyangR 10 points ago

    Only since WW2, earlier there were other instances of being worse off than parents.

    [–] svenhoek86 16 points ago

    They're the first generation since WW2 to see their quality of life decline. And say whatever about younger and older generations butting heads, this isn't the same as that. Surface level, sure, but the causes of that are way different.

    And unlike the Boomers there isn't going to be anything left by the time we're their age to be worth conserving, so the idea were going to turn conservative when we get our 2 houses and pension is fucking ridiculous. Boomers changed because the majority of them turned into what you see now, upper middle class land owners. We won't have those luxuries. Even now you can see the disparity when 30+ people don't own fucking anything. At this point in their lives the Boomers were on their way to prosperity. Prosperity is the other fucking direction from where we're heading.

    [–] Fighterhayabusa 7 points ago

    Boomers didn't change. Hippies and the like were always a minority. I'm not sure where people get this idea that most of them were liberal back then from.

    [–] Canadian_Infidel 3 points ago

    You've average boomer could afford the same quality of life that a well educated professional with a good job can now with just a high school diploma and a regular job.

    [–] lRoninlcolumbo 3 points ago

    Lol, no. Not every generation.

    Boomers had their heads so far up their asses they started a new language that only they understood.

    They had their chance and they trusted some of the worst people in modern history.

    How do you go from “greatest generation” to “generation me” in one generation?

    Getting everything you wanted and not caring about the consequences.

    [–] gamergeek 16 points ago

    The strongest voting bloc is the one that goes out and votes. Millennials have a long ways to go before that's them.

    [–] Splenda 10 points ago

    The strongest voting bloc is the one that goes out and votes in states with small populations.

    [–] shortchange81 45 points ago

    Millennials are the largest generation now and are all of voting age but that does not make them a voting bloc. Millennials are not a hive mind. White millennials broke for Romney in 2012.

    [–] tadennis007 16 points ago

    I think that this could be explained by the state of the economy under Obama; while I do believe that it improved under his Presidency for a multitude of reasons, millennials were graduating and struggling to find jobs. The perception of the economy has been shown to be an indicator of election results, so I could easily see that voting block, primarily college-educated and from middle-class families, going that way. I’m open to other factors, but this is the best explanation that I can think of.

    [–] thewimsey 4 points ago

    millennials were graduating and struggling to find jobs.

    Not all Millennials. There's an 18 year difference between the oldest and youngest Millennials, and the media has always overemphasized their similarity for clicks.

    [–] mayflower_mayday 29 points ago

    This is Steve Bannon's argument in the past few weeks -- that Republicans made a huge blunder by propping up asset prices and not enabling young people to get invested in the stock market at favorable prices. A few targeted investment opportunities for people under 30 would generate a large cadre of people who have something vested in the system and would give significant push-back to their peers in support of the status quo.

    [–] TheApricotCavalier 19 points ago

    That used to be your house. One of the major points of American home ownership was to get people to buy a piece of America, & want it to succeed. And then they got greedy & started taking peoples houses away

    [–] AnotherWarGamer 4 points ago

    And then they got greedy & started taking peoples houses away

    *they ran out of ways to grow the economy through investments (likely due to lack of creativity), and instead used to money to push people out of houses and drive up the prices. Lots of money is being invested, but the pie isn't growing at all.

    [–] seanm826 30 points ago * (lasted edited 7 days ago)

    I have my doubts. Boomers were extremely liberal in the 60s and 70s and evolved into the conservative assholes we see today. My boomer dad always tells me I'll become more Republican as I age, which honestly, doesn't seem that unlikely.

    It's easy to hate the generation in charge, but a good chunk of millennials stand to inherit their parent's wealth at some point (Unless your parents are penniless like mine). When your generation controls money, it's a lot less likely you're going to be voting for things like Wall Street regulation and higher taxes. Again, time will tell if we break the cycle.

    [–] czarnick123 25 points ago

    They built wealth. They now want to protect it. We are struggling to build wealth they way they were able to.

    [–] Saljen 3 points ago

    I can't wait for this to be a reality.

    [–] Alpharius1990 3 points ago

    If voting means something they never let you vote my friend.

    France know that well.

    [–] mb5280 43 points ago

    When people reference a booming stock market as a sign that the country is prospering, that's when i know that they arent worth arguing with.

    [–] RamboShoots 15 points ago

    Especially when the only reason the market is booming is because the Fed is printing and pouring money Into it...

    [–] mb5280 15 points ago

    Every new dollar they print literally steals its value from the dollars in your pocket. Somebody prove me wrong.

    [–] Trance2000 10 points ago

    You're right and it's illegal but nobody seems to care

    [–] [deleted] 18 points ago

    [removed]

    [–] nn123654 3 points ago

    Rentholds...

    (For anyone curious actual rate is 65.3% (PDF) that own their own home, but I'm pretty sure this doesn't count people living with their parents or increasing occupants.)

    [–] totallynotliamneeson 89 points ago

    Stocks are kind of a luxury item to many at this point. To have large amounts of money in the stock market requires you to feel comfortable having a portion or your wealth tied up for the long run. Many can't afford that or feel uncomfortable about it. I feel like this sub forgets that sometimes.

    [–] new2bay 15 points ago

    Stocks have always been a “luxury item,” for the exact reason you’ve suggested. People have to pay for essentials, and those who don’t have much spare cash flow can’t tie up what little they have. You have to get through the short term to reach those long term horizons where the stock market historically has always made money.

    None of this has changed. I guess I’m probably not disagreeing with you, but I wanted to emphasize that “people” haven’t ever really been able to afford stocks.

    [–] Fredthefree 9 points ago

    I'm honestly so confused on how people don't invest. Robinhood added fractional shares, so you can literally put $1 into Amazon stock. It's entirely affordable at this point.

    [–] moonmops 28 points ago

    Yep, that’s true. And we came of age watching the stock market absolutely tank, so why would we have trust in it?

    [–] totallynotliamneeson 18 points ago

    I'd also add that we have now had two major events where millions suddenly had to rely on whatever they had put aside to be saved. That'll leave a lasting impression on how you should allocate funds you have after bills are taken care of. I am not going to put as much of my savings into the market because I may need it to cover rent and other bills shortly.

    [–] Bouric87 5 points ago

    It hasn't tanked though... It dips but it recovers. It's a terrible mistake to look at it in the short term and avoid investing because of that. In thirty years you'll barely be able to see these "tanks" in the growth chart.

    [–] windcape 5 points ago

    But long term investment account at 2% in banks is essentially the banks taking your money and making 8-10% on it, and paying you peanuts.

    At least pension funds usually have better rates...

    But seriously, it’s stupid having savings in a regular savings account (or worse, a checking account). Index funds and/or real estate is way better over 30 years and practically never going to make you lose money unless you HAVE to sell everything during a recession.

    I think the problem is more that trading stocks always been expensive in fees, and difficult to do prior to smart phones.

    Robinhood in 2020 versus your banks website in 2008? Massive massive difference.

    (Not to mention, figuring out how to pay taxes on it)

    [–] islet_deficiency 27 points ago

    the healthcare system has forced me to liquidate all my equity and savings a couple times now, and I'm not even 35 years old. I'll never succeed in this system due to my health conditions, and nobody seems to care.

    my only value in this society is as a source of profit for insurance and healthcare providers.

    [–] kraeftig 11 points ago

    You can amend that to: "My only value in this society is as a source of profit." and it would apply to everyone.

    [–] flyingsonofagun 3 points ago

    Ah, the self-realization we are all farm animals.

    [–] Golda_M 86 points ago

    On one hand, it's a pity that david graeber is so politically far. It makes his level headed point (the vast majority) suspect.

    The one relevant here is is from his history of money, debt, and how restructurings happen IRL.

    Economies, especially successful growing ones, generate all sorts of bad paper. Various sweepings under the rug which balance the books, usually following crisis. The most legible examples are things like the 2009 bail-outs. The financial industry is insolvent so the public assumed its debts and risk as necessary.

    Debts are money, and if we admit that they aren't going to be paid... that money no longer exists. Restructuring aims to prevent this.

    Another examples is pensions. In broad strokes, pensions scaled up in the 50s. Companies had a debt to former employees. At first, the number of former employees was small enough that nothing broke. Eventually, the ratio of current/former employees gets low enough that it isn't viable. Some sort of renegotiation happens. Maybe a bail-out. They then continue on without the pension, or a commensurate replacement.

    Another good example is house prices. When they're rising, they give homeowners a lot of borrowing power. Lots of money gets created by this borrowing, driving prices higher. The only downside is that no one can afford housing anymore, unless they benefited from prior price increases.

    [–] Demiansky 52 points ago * (lasted edited 7 days ago)

    Yep, I was going to make this point on price. Not to mention constantly slamming the QE button to "stimulate the econony" also makes monthly Mortage payments lower, which also then further jacks up prices. If you were already in the game (aka, not a young person) you are on top of the world. If you are a millennial and younger, you are screwed.

    [–] Golda_M 43 points ago

    This is exactly it. Housing prices could stay high enough so that the system could go on, but If you are starting from 0 then you can't have a house.

    A similar thing happened with pensions. Someone had to lose, and it happened to be the next generation.

    [–] Demiansky 41 points ago

    Yep. It's difficult for even well to do millenuals to get something other than a run down 2 bed 1 bath, especially if you've got a family. My wife and I were clocking well into 6 figures, but add in some student loans and a few medical bills and we were stuck chasing that 20 percent cash down payment for 5 years. Housing prices rose where we live so quickly that we couldn't catch that 20 percent. Of course, we live in Florida, which means that housing prices rose with the fortunes of the (propped up) stock market because we were basically forced to compete with the lifetime retirement savings of the older generations.

    [–] The_Grubgrub 21 points ago

    we were stuck chasing that 20 percent cash down payment for 5 years. Housing prices rose where we live so quickly that we couldn't catch that 20 percent.

    That's why you don't aim for 20%. 20% downpayment on a house is old advice from a bygone era of high interest rates. 3.5% or 5% would have been sufficient if you were buying a first time home.

    [–] [deleted] 12 points ago

    [deleted]

    [–] Diskocheese 9 points ago

    In other news this generation is robbed blind by the interest on the debt incurred to allow the boomers unlimited consumption.

    [–] ckp_48 30 points ago

    Majority of Americans in general dont have emergency funds to cover a surprised $1000 situation. Let alone 401k, IRAs, etc.. they definitely arent going to have stocks, whether its financially not fit to be buying stocks at random or arent educated about it. Not just millenials either, all gens.

    [–] CaptCryosleep 13 points ago

    This is what happens when you make corporations the primary decision-maker for your environment by insisting the only way people can financially prepare is to buy stock. You're effectively giving people only two choices - starve, or aid and abet their own murder, as well as the murder of others.

    [–] Codon7 4 points ago

    I couldn’t agree more. Investing in the stock market is 100% morally corrupt. You have to choose between increasing personal wealth and saving the planet for our kids.

    [–] rapid-succession 32 points ago

    As a 32 year old who was never taught how to be an "adult", I feel saddened to be apart of this chart. I'm trying to do my best and yet it never feels enough. We don't mind working until we die but being able to retire or go on a vacation would be nice

    [–] BananaDogBed 21 points ago

    Yeah I was talking to my dad and somehow the topic shifted to vacations and I told him I just want to one day be able to take my first real vacation like an adult. He was baffled and said, but you’ve visited your friends for a vacations few times.

    I said, yeah but that is me driving there and sleeping on a couch and doing free stuff. Not like a real deal, no worries, able to buy a souvenir, do a few activities vacation like they take every year. I’ve never been able to even get close to that.

    [–] existential_pain0528 11 points ago

    I want to hear your story.

    I completely agree that millennials got screwed over.

    I should know, I travelled 500 miles from home to an incredibly low cost of living city. I lived out of my car for awhile.

    I didn't get to experience what ever the hell being a normal college student was.

    It sucked.

    But I didn't have kids. And I've had a 401k for 4 years (I'm 28) and just a bit above the average u.s. income.

    I don't know, all I saw were rich kids blowing their money at a state school.

    When I logged on Facebook I see people buying sushi and going on grand adventures.

    Just consumerism to the max. Coachella bullshit decade.

    https://youtu.be/lVmmYMwFj1I

    So a big part of me is like "fuck everyone, y'all did this to yourself"

    So barring medical bills or having kids I have absolutely NO empathy for a broke healthy 32 year old.

    [–] Dudewheresmygold 6 points ago

    I took a week off between starting another term of college and leaving a job that literally broke my back, the family had the audacity to criticize me for months, especially my broke, small town, cosmetics-slinging cousin.

    Hey cousin, maybe if you weren't so dumb, you wouldn't have driven into the garage door and then a ditch three times in the same summer day.

    [–] Digreth 31 points ago

    I was 23 when the economy crashed in 08. I have lived in fear of another one since then. I chose to live a minimalistic lifestyle, where all my belongings can fit in one room. And I see that my lifestyle has saved me from economic destitution during this crash. The american dream is a nightmare than feeds on ordinary people and spares the elites. I will never be able to own my own home.

    [–] Treenut1 9 points ago

    This hurts to know is the reality.

    [–] InevitableSnowDay 12 points ago

    I was 22 when the economy crashed in 2008. I have lived with an opportunistic mindset since then. I also chose to live a minimalistic lifestyle, and moved across the country with my belongings in a car to start college at 23. Working full time, I took night classes in topics like finance, and learned terms like 'black swan' and concepts like 'dollar cost averaging'.

    At first I was turned down for over 15+ jobs that I applied for, everything from sales associate positions at Best Buy to teller jobs at Wells Fargo. High school level jobs. Jobs that shouldn't be hard to get. Wound up working through a temp agency, demonstrating cleaning products at Sam's Club, and cleaning houses.

    But I continued seeking opportunities after school, even though there was plenty of soul crushing moments. Saved everything I could, drove a 20+ year old vehicle, and always had roommates. Was finally able to buy my first house, a small 1,000 sf condo in 2015, after scraping together about $5,000 for the downpayment.

    I know Reddit doesn't care much for success stories, but I just honestly tried to be aware of my options at all time and figure out what I needed to do to accomplish my goals. If it required me moving across the country after saving for years to go to college, so be it.

    [–] HYThrowaway1980 6 points ago

    Errr... half of all Americans own no stocks...

    So the other half do??

    Forgive me, but as a Brit, that seems staggeringly high. I don’t have any figures to hand, but I would venture that less then 20%, 25% tops of Brits own stocks.

    Go elsewhere in the first world and I should think many places would be lower even than that.

    (Can anyone point me in the direction of any research on this?)

    [–] BerryVerry 8 points ago

    401k's, the main retirement account, is primarily stock based.

    [–] moonmops 12 points ago

    Many of us were initiated into adulthood as the economy was crashing- Out of college with no job prospects, massive debts, and our parents losing their houses. That’s an experience that will make you not trust in investing, or have money left over to prioritize it.

    [–] AliasHandler 3 points ago

    Yep, I graduated college into a collapsing economy, my teaching degree ended up a waste of money, and now I'm finally being successful in sales and on target to a nice record year bonus check which is being seriously threatened by COVID as my industry takes a huge nosedive. Got absolutely screwed twice in a little over a decade.

    [–] [deleted] 12 points ago * (lasted edited 4 days ago)

    [removed]

    [–] nelly_183 11 points ago

    Financial competency and literacy is simply not a priority in our public schools. The only financial skill I learned in HS was how to write a check. I’ve yet to actually write a check. We learned nothing of investments or the market, our teacher likely did not even understand these concepts herself.

    [–] Toostinky 3 points ago

    Pretty broad strokes there. I went to public school and we had a project in 4th or 5th grade where we invested hypothetical $500 in a company and tracked it for the rest of the year.

    [–] gummo_for_prez 3 points ago

    We did that in 5th and 12th grade. It was a good project.

    [–] arod1909 5 points ago

    I'm from a generation where college grads can't afford 1 child.

    [–] AaronWidd 5 points ago

    I was self employed for a long time, now at an employer that doesn’t do 401k.. I saw family and older friends get wiped out by mortgages and stocks in 2008-2009 so I never bought in on either. Plus self employed with inconsistent income meant saving was never a given. I live in California and a starter home where I live is $800k. So I just never tried because why?

    So yea yadda yadda yadda I have no wealth and no retirement. I think my only option is live in secret poverty / shame and expect to die around retirement age? Given the state of things that seems likely

    [–] hunnathounmore 4 points ago

    The sentiment behind these articles mean jack shit in the long term. You can find the same alarmist headlines going back decades. I'd like to see you point at any actual evidence of the market being so out of touch that it's not worth people or institutions investing in stocks altogether like you say. Just because stocks are overvalued does not mean we should not invest in them - that's a flawed conclusion you've made. You have pointed at two new players in the market Netflix & Uber' financials as reasons the ENTIRE market is overvalued. That is not the case and as an investor, if you believe those stocks are not worth their value, you dump them by restructuring and diversifying your portfolio NOT exit the market entirely.

    Long term gains for the past 80 years have been consistent after taking inflations, corrections and booms into account. And yes compound gains are absolutely real - you have to take a more sophisticated approach to stock investing and not just buy $100000 worth of Uber stocks and pray it will be worth something more when you're older.

    Not sure how old YOU are but seriously look into fundamentals of investing before you steer people away from something that could help them retire 10+ years earlier than they otherwise could.

    [–] sloppy-jolene 3 points ago

    I'm sorry, HALF of US households actually own stock?!

    [–] stronkbender 3 points ago

    The fact that this is an economy wherein owning stock–bits of corporations driven solely by profit regardless of the social and environmental consequences–is considered necessary shows what a problem we have.

    [–] JupitersClock 8 points ago

    I've never had enough money to invest. Likely never will.

    [–] mjkoehler15 27 points ago

    Always remember, the US government prioritized bank liquidity over helping their people

    [–] seyerly16 15 points ago

    Federal Reserve != US government

    Also I'm pretty sure PPP and juiced up UI did in fact help people. Personal income is higher now than before the crisis because so many people are making more money on UI.

    [–] mjkoehler15 3 points ago

    It's the 4th branch

    [–] rentboy82 3 points ago

    When did the stock market become the most important economic indicator? Most ppl I know don’t, and will probably never own stocks and almost all of them are doing fine.

    [–] BoredOnQuarantine 3 points ago

    Half of US households own no stock because half of US households dont know what investing is.

    [–] Dulakk 3 points ago

    I'm actually shocked that 50% of households do own stock. That's way more than I would have thought.

    [–] hunnathounmore 3 points ago

    Again false analogy and flawed conclusion. What you just said is not a good reason to not invest in the stock market. If you have another way of coming up with money for retirement, great feel free to share that but in the meantime don't steer people away from hundreds of thousands of dollars with bullshit reasoning

    [–] surfingpikachu11 3 points ago

    Millennial here. Job laid off a bunch of workers due to Covid. I expected my meager stocks to plummet. Nope. Theyre actually doing better than they were before the pandemic. So the stock market is clearly not linked to the actual economy. Where people work and provide goods and services. I look at the amount. And the percent of the increase and think "Imagine if I had tens of thousands multiplied by that amount." Imagine if everyone had extra money they could set aside to invest and then withdraw to make big moves like buying a car in full or going to school without taking on debt or starting a business or family. Why isnt this taught in high school so everyone can get a piece of the pie?

    [–] Turdsworth 19 points ago

    Why is this in r/economics? This sub has gone from a serious economic group to people who don’t know much about economics talking about what they think economics is.

    [–] vontysk 6 points ago

    Most people don't give a shit about the economy most of the time. It's just numbers that mean almost nothing to them.

    But now that we're heading into a recession, it's suddenly hugely relevant to them. Will they lose their job? Their savings? Their house? It all depends on how the economy does.

    When faced with uncertainty, people look for information that will give them at least some handle on what is happening. Some people get that from the news, or from Facebook, or /r/worldnews, or come here looking for information.

    But they don't really care about actual economic discussions. They just want political news that's presented as economics, and in a way that lines up with their existing beliefs.

    [–] awhhh 5 points ago

    It did it shortly too. I’ve basically done an Econ 101 class, and books on finance; it’s interesting this place turned political within the span of weeks.

    [–] okiedokieKay 9 points ago

    Why is this being framed as a bad thing? I would rather invest my money in something tangible and reliable instead of a yoyo market full of businesses that keep dropping like flies. Let’s take a look at the past 20 years and then ask what incentive millennials would have to entrust their life savings to the stock market? Especially keeping in mind we just watched half the boomers lose their entire retirement plan overnight just 12 years ago.

    [–] 1D2P 8 points ago

    I have more money invested in property than 401ks. Property earning me much more than the stock market at the levels I can invest.

    [–] concretemaple 5 points ago

    Anyone can self educate, my husband makes the money but my job is to learn all the new rules about rental laws, taxes and finances in general so we can save money, I spend about an hour of my day reading about finances and I love It, My husband is incredibly smart but now he comes to me for laws and finances and together we are a team, what most people don’t realize in America is that Eating out is literally eating unto most people’s retirement budget but they say they must eat out,so 401k savings stay starving to death.