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The New Bubble

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Pyperkub
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Re: The New Bubble

Post by Pyperkub » Thu Jun 07, 2018 3:02 pm

LordMortis wrote:
Thu Jun 07, 2018 2:59 pm
They got the best opportunity and to get in to housing that I've seen in my lifetime. Student debt may have completely fucked that opportunity over but the opportunity was (and to a lesser extent still is) there.
This all depends on where they live/want to live. Places where there are good paying jobs tend to have high housing costs. The Bay Area is an outlier, but still an example of how insane this is in some areas.
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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 3:06 pm

Pyperkub wrote:
Thu Jun 07, 2018 3:02 pm
LordMortis wrote:
Thu Jun 07, 2018 2:59 pm
They got the best opportunity and to get in to housing that I've seen in my lifetime. Student debt may have completely fucked that opportunity over but the opportunity was (and to a lesser extent still is) there.
This all depends on where they live/want to live. Places where there are good paying jobs tend to have high housing costs. The Bay Area is an outlier, but still an example of how insane this is in some areas.
I don't buy it. If your goal is to be 24 years old one quick job removed from college and your expectation is a job and wage for some company with now allegiance to you that affords you $500,000 two room fixer upper. That's not a problem of your prospects, that's a problem of your expectations, IMO.

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Re: The New Bubble

Post by malchior » Thu Jun 07, 2018 3:20 pm

LordMortis wrote:
Thu Jun 07, 2018 2:59 pm
malchior wrote:
Thu Jun 07, 2018 11:48 am
Tell that to my wife. Her choices of retirement plans are a complete joke compared to mine. I also make 3 times more than her. The difference is I'm 10 years older and got in before the economy went to shit for her entire generation from a wealth creation point of view. It is messed up that the only reason her retirement (at a reasonable age) is possible is she married an old guy.
I need more than that to sway my observations. I'm seeing jobs everywhere with "retirement plans" similar to what they have always been 401k SafeHarbor 3% salary match.
How about the source article that says that millennials have less access to good 401k plans? Or this study that shows that 35% of people 22 and older don't have access to a 401k plan at all and its 41% for millenials alone? And there are no standards but the "marketplace" about what kind of 401k plans are offered. In the past the marketplace would have probably been enough but clearly not with wages stuck in neutral despite record unemployment (to be a bit fair we'll see if that holds up).

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Re: The New Bubble

Post by Pyperkub » Thu Jun 07, 2018 3:36 pm

LordMortis wrote:
Thu Jun 07, 2018 3:06 pm
Pyperkub wrote:
Thu Jun 07, 2018 3:02 pm
LordMortis wrote:
Thu Jun 07, 2018 2:59 pm
They got the best opportunity and to get in to housing that I've seen in my lifetime. Student debt may have completely fucked that opportunity over but the opportunity was (and to a lesser extent still is) there.
This all depends on where they live/want to live. Places where there are good paying jobs tend to have high housing costs. The Bay Area is an outlier, but still an example of how insane this is in some areas.
I don't buy it. If your goal is to be 24 years old one quick job removed from college and your expectation is a job and wage for some company with now allegiance to you that affords you $500,000 two room fixer upper. That's not a problem of your prospects, that's a problem of your expectations, IMO.

Bay Area millennial trends:

Sacramento saw more than 16,000 new Millenial-aged residents in 2016, with 9,500 out-migrations. Seattle and Columbia saw net migrations of 7,302 and 6,937 respectively.
It's cheaper in Sactown.
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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 4:14 pm

malchior wrote:
Thu Jun 07, 2018 3:20 pm
stuff
I will trust Pew's survey's with a bit of details more than "My research" with no details, though I still have a question.
Indeed, data analyzed by The Pew Charitable Trusts found that 35 percent of private sector workers over the age of 22 don't work for a company that offers a plan. And the numbers were more stark for younger people. Pew found that 41 percent of millennials didn't have access to an employer-sponsored retirement plan while only 35 percent of Gen-X and 30 percent of boomers had to do without.
Was that 6% gap filled in when Gen-X was millennial age? Which is to say if there is a very real gap of 6% and I have no reason to doubt pew, what were the percentages like 25 years ago for the same age groups? And while curious, from that link I find this number to be much more shocking and interesting:
Pew found that only 52 percent of millennials with plans available are making contributions. In contrast, a full 80 percent of boomers and 75 percent of Gen-Xers are.
Does this tie directly to student debt or are there other major contributing factors? Like a cost of living or a nonchalance or a lack of faith in investment vehicles. It also calls in to question how much they even care about finding a job with access to a retirement vehicle.

While I don't see your outrage, the pew stuff did manage to take me from 'meh, show me something to fuss about before I fuss" to that's actually incredibly interesting I want to know what's behind the number you're putting out there.

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Re: The New Bubble

Post by LawBeefaroni » Thu Jun 07, 2018 4:39 pm

It's all good. Millennials are pouring into crypto-currencies. They all gonna be rich.


But really. They have all kinds of access to investing that previous generations didn't. When I wanted to start I had to find a broker, go into the office, have them tell me to get bent because I couldn't open a $100K minimum account, and that was that. My only real option was the pension (which is long since closed) and 401k.

Now you can put $100 your first paycheck into the market however you want from your phone. In about 10 minutes.
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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 4:46 pm

LawBeefaroni wrote:
Thu Jun 07, 2018 4:39 pm
It's all good. Millennials are pouring into crypto-currencies. They all gonna be rich.
:( Is that a poke at my nephew. :cry:

But really. They have all kinds of access to investing that previous generations didn't. When I wanted to start I had to find a broker, go into the office, have them tell me to get bent because I couldn't open a $100K minimum account, and that was that. My only real option was the pension (which is long since closed) and 401k.

Now you can put $100 your first paycheck into the market however you want from your phone. In about 10 minutes.
Yeah but it's not tax deferred. Of course some here would argue that tax deferral is waste.

But now that you mention it. If I were smart enough to do a ROTH IRA when I was younger, it pretty much had to be through a broker of consequence with limitation right up until the late 90s with $7 trades that included ROTH IRA work. At $5500 a year at age 22 as opposed to age 44? That's huge. :oops: Of course, I didn't have that whatever money could put aside for that at 22 or 23 or 24 or 43.

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Re: The New Bubble

Post by malchior » Thu Jun 07, 2018 4:59 pm

LordMortis wrote:
Thu Jun 07, 2018 4:14 pm
Does this tie directly to student debt or are there other major contributing factors? Like a cost of living or a nonchalance or a lack of faith in investment vehicles. It also calls in to question how much they even care about finding a job with access to a retirement vehicle.
Student debt is a component. Another is they on average get paid less than 15-20 years ago with the equivalent degree.
While I don't see your outrage, the pew stuff did manage to take me from 'meh, show me something to fuss about before I fuss" to that's actually incredibly interesting I want to know what's behind the number you're putting out there.
My position is I'm fairly surrounded by millennials all the time. I work with them, they are involved in my hobbies, and I manage them. The common theme is always that almost all of them are struggling financially. And I'm talking about some folks making relatively good money. It is multi-factorial and complicated but they are dealing with problems we simply didn't face. IMO I can't help but conclude our economy has major issues that are making their lives much worse than their parents and our lives. I get wanting to frame this from our point of view but I encourage anyone interested to actually listen to them and get a deeper understanding. They are being completely shafted this economy. It is a society wide problem.

It is causing all sorts of down the line problems. They aren't building wealth. They aren't buying homes. They aren't having kids. Want to be Japan with completely stagnant growth in 25 years? We just need to keep on this path. It'll eventually happen.

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Re: The New Bubble

Post by Sepiche » Thu Jun 07, 2018 5:01 pm

malchior wrote:
Thu Jun 07, 2018 4:59 pm
It is causing all sorts of down the line problems. They aren't building wealth. They aren't buying homes. They aren't having kids. Want to be Japan with completely stagnant growth in 25 years? We just need to keep on this path. It'll eventually happen.
Well, we won't completely be Japan until the Trumpers finally cut off all immigration.

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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 5:12 pm

malchior wrote:
Thu Jun 07, 2018 4:59 pm
My position is I'm fairly surrounded by millennials all the time. I work with them, they are involved in my hobbies, and I manage them. The common theme is always that almost all of them are struggling financially. And I'm talking about some folks making relatively good money. It is multi-factorial and complicated but they are dealing with problems we simply didn't face. IMO I can't help but conclude our economy has major issues that are making their lives much worse than their parents and our lives. I get wanting to frame this from our point of view but I encourage anyone interested to actually listen to them and get a deeper understanding. They are being completely shafted this economy. It is a society wide problem.

It is causing all sorts of down the line problems. They aren't building wealth. They aren't buying homes. They aren't having kids. Want to be Japan with completely stagnant growth in 25 years? We just need to keep on this path. It'll eventually happen.

My position is that this is not limited to millennials. And from my perception which may very be changed, reality is closer to GGs perception than yours. As the gap between haves and have nots widen millennials are the most exposed but there relative position isn't really different that it was twenty years ago. Except for college debt which exacerbates other problems.

I don't know who we is? But in my neck of the woods, we faced those problems. The only people with houses at age 28 were 1) those who skipped college because they had a golden ticket into a union job at the big three (rare) had skilled trades in their blood (less rare) or were supplemented by their families. That goes doubly for building wealth. Having kids, well... People aren't always doing what they should be doing.

So when you describe your plight to me, you are describing a shrinking circle of wealth being handed from parents to children in the world I grew up in, which again reinforces GG perception not yours.

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Re: The New Bubble

Post by LawBeefaroni » Thu Jun 07, 2018 5:15 pm

malchior wrote:
Thu Jun 07, 2018 4:59 pm

The common theme is always that almost all of them are struggling financially. And I'm talking about some folks making relatively good money. It is multi-factorial and complicated but they are dealing with problems we simply didn't face.
Other than student loans, what else causes this? If you're making good money and not wasting it, how do you struggle financially? And yes, I consider a $4k/month rent to be wasteful if it causes you to struggle.
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Re: The New Bubble

Post by malchior » Thu Jun 07, 2018 5:20 pm

LawBeefaroni wrote:
Thu Jun 07, 2018 5:15 pm
malchior wrote:
Thu Jun 07, 2018 4:59 pm

The common theme is always that almost all of them are struggling financially. And I'm talking about some folks making relatively good money. It is multi-factorial and complicated but they are dealing with problems we simply didn't face.
Other than student loans, what else causes this? If you're making good money and not wasting it, how do you struggle financially? And yes, I consider a $4k/month rent to be wasteful if it causes you to struggle.
Their wages are lower and they have more debt load. Housing costs more money. Multi factorial. You don't have to believe me. Look at all the data. The data is not lying. I'm just relating what I hear because it humanizes it but the problems are there. Seriously have a conversation with any group of them - they are universally struggling.

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Re: The New Bubble

Post by em2nought » Thu Jun 07, 2018 5:26 pm

Sepiche wrote:
Thu Jun 07, 2018 5:01 pm
malchior wrote:
Thu Jun 07, 2018 4:59 pm
It is causing all sorts of down the line problems. They aren't building wealth. They aren't buying homes. They aren't having kids. Want to be Japan with completely stagnant growth in 25 years? We just need to keep on this path. It'll eventually happen.
Well, we won't completely be Japan until the Trumpers finally cut off all immigration.
A guy can dream can't he? :wink:

The greatest generation squirreled away a vast sum of wealth, and when their spoiled boomer children inherited it they blew it on stupid crap so their children aren't getting jack from them, and their children's children aren't getting jack either. IMHO
#WalkAway

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Re: The New Bubble

Post by noxiousdog » Thu Jun 07, 2018 6:05 pm

malchior wrote:
Thu Jun 07, 2018 4:59 pm
Another is they on average get paid less than 15-20 years ago with the equivalent degree.[/url]
Wages for university grads are 2.5 percent lower than what they were 15 years ago, according to the latest edition of the Economic Policy Institute’s annual report on the labor market prospects of new workers.
I also can't reconcile how people have less money, but pay more for real estate. That's like the Yogi Berra quote of nobody comes here any more because it's too crowded.
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Re: The New Bubble

Post by noxiousdog » Thu Jun 07, 2018 6:19 pm

GreenGoo wrote:
Thu Jun 07, 2018 12:42 pm
Why wouldn't the various forms of income tax (be it straight income, capital gains, dividends, what have you) be enough? Is your concern privately owned (or at least majority owned by individuals) businesses?
Income is linear. If I get paid 50k. I get 50k. Next year I get 50k. etc. In 20 years, i have 1 million.

Wealth (at these levels) is exponential. At 7% returns it doubles every 10 years roughly. The guys that are doing private investments are looking for 20% ROI. They can double every 3 years. They don't pay tax until they sell, and then it's at 15% if they ever do.
I'm struggling to think of wealth accumulation that is not covered by current tax law. Presumably they get around those laws somehow?
They never sell, or if they do, it's minimal compared to their overall net worth.
Unless you think it's purely random that the the 13 are American, it appears to simply show that America is a good place to build wealth with your wealth. I'd be very much surprised to see the pattern change significantly with the top 1000, but I'd like to see that data too, if it is available.
It's multi factor. For many reasons it's easier to create a huge business in the US. I don't know why Google (or Facebook or any of the other companies in the list) didn't start in Europe or Canada, but it didn't. It's not really about wealth building laws (though I'm sure it helps), and more about being able to build a multinational entity.
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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 6:20 pm

malchior wrote:
Thu Jun 07, 2018 5:20 pm
Their wages are lower and they have more debt load. Housing costs more money. Multi factorial. You don't have to believe me. Look at all the data. The data is not lying. I'm just relating what I hear because it humanizes it but the problems are there. Seriously have a conversation with any group of them - they are universally struggling.
You keep saying things as if they were true

https://fred.stlouisfed.org/series/CSUS ... categories

And houses are bigger with more, which means the upper end, more 3500 sq foot new constructions are bringing that index up. They keep getting bigger with more. And Interest rates have remained at historic lows for 10 years now.

And there continue to be vehicles we never had

https://www.findmywayhome.com/news/2018-mcc-tax-credit/

https://www.valuepenguin.com/mortgages/ ... gage-rates

You give me no reason to trust your statements. As you say data is not lying.

Wages are fucking the general populace. Not just millennials. The wage gap is widening and the millenials are at the widest because they've been in the workforce the shortest amount of time. I don't see your truthful data there that sets them apart. And again and again and again, I think you are hard pressed to find someone who is denying student is a problem.

All that said, this still interests me. I go home. I went to google. I typed "What do Mil" and google said "what do millennials want in a job" Sure I can answer that.

First bite, I bolded some of the more interesting items.

https://www.capitalgroup.com/our-compan ... ments.html
Millennials expect new workforce benefits that align with their lifestyles and values.
Millennials, Generation Xers and Boomers agree on the top three “must-have” benefits: health insurance, vacation time and matching 401(k) plan
Eighty percent of Millennials believe that all employers should be expected to provide a retirement savings option, compared to 71% of Boomers
Sixty percent of Millennials say the ability to have a flexible schedule is very important, and, more than previous generations, they want paid time off to volunteer, a mentoring program, free lunches and snacks, and other perks such as pet-friendly offices
One in three Millennials (34%) say a 529 or college savings plan is a very important benefit for new employers to offer
Millennial workers keep on the move but think loyalty to their employer is important.
Twenty-one percent of Millennials describe themselves as working primarily in the gig or sharing economy, and 14% earn extra income through a website or app
Thirty percent of Millennials have held three jobs or more over the past five years, compared to 10% of Gen Xers and 6% of Boomers
Two-thirds (67%) of Millennials say being loyal to their employer is important to them — about equal to Baby Boomers and Gen Xers
Millennials are very engaged in saving and investing for retirement.
Nine out of 10 Millennials (91%) contribute to a 401(k) or IRA account
Retirement saving ranks second only to paying rent or mortgage as a financial priority; one in five Millennials (22%) rank retirement saving as their number one priority
Seventy-two percent of Millennial investors say they know specifically or are somewhat confident about the types of mutual funds and investments they have in their retirement accounts
Nearly seven out of 10 Millennials (69%) believe that individuals have primary responsibility for taking steps to ensure they have a secure retirement
Millennials look at investing success as helping family and making changes in their lives.
Only 10% of Millennials say they would stay in the same career and current lifestyle if they knew they would have enough money to retire
Twenty-three percent say more investing success would help them a great deal to take time off to care for aging or ill family members (9 percentage points higher than for Boomers)
Millennials tend to worry more about near-term finances such as current income (34%), paying off their loans (34%) and paying for their children’s education (31%) than Generation Xers and Boomers
Millennials expect companies they invest in to deliver financial and social impact.
Eighty-two percent of Millennials say it’s important for companies in their investment portfolio to promote the health and wellness of consumers and employees ─ 10 percentage points higher than Boomers
Differences between Millennials and Boomers are even greater when it comes to helping disadvantaged communities (+13 percentage points), including more women in senior management and boards of directors (+14 percentage points) and promoting economic opportunity for women, minorities and LGBT persons (+14 percentage points)
Bite two from Mellenials in 2016

https://hbr.org/2016/05/what-millennial ... -a-new-job

At their current stage in life, Millennials fundamentally think about their role as a stepping stone and a growth opportunity. But they also want to feel deeply committed to their role and to work for a manager who will invest in their development, which isn’t entirely different from what other generations value. Our research shows that having a great manager and being part of a great management culture are important to all employees. However, Millennials place a greater emphasis on opportunities to learn and grow and opportunities for advancement.

What about ping-pong tables and free beer? Contrary to popular perception, Millennials place little importance on a company encouraging creativity or being a fun, informal place to work. In fact, Baby Boomers are slightly more likely than Millennials and Gen Xers to say that creativity and fun are “extremely important” to them when applying for a job. But Millennials do need to be convinced why and how an organization will help them learn, grow, and develop, and further their careers.

And although income is not among Millennials’ top five factors when applying for jobs, it still matters to them when looking for a job, as it does to all employees. Millennials have high levels of student debt and are living in an era of anemic wage growth. This might be why, as we derived from a separate study, half of Millennials said they would consider taking a job with another company for a raise of 20% or less. It is understandable that they would seek roles that make better use of their qualifications and increase their income. But companies should also know that Millennials sometimes value other job attributes, including learning and advancement, even more.
Bite three from Millenials three years younger ago

https://www.inc.com/marcel-schwantes/wh ... -in-1.html

Can't quote but the suggestion was that flexibility and the ability to freelance was the first consideration not finance in 2015.

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Re: The New Bubble

Post by malchior » Thu Jun 07, 2018 6:36 pm

LordMortis wrote:
Thu Jun 07, 2018 6:20 pm
malchior wrote:
Thu Jun 07, 2018 5:20 pm
Their wages are lower and they have more debt load. Housing costs more money. Multi factorial. You don't have to believe me. Look at all the data. The data is not lying. I'm just relating what I hear because it humanizes it but the problems are there. Seriously have a conversation with any group of them - they are universally struggling.
You keep saying things as if they were true

https://fred.stlouisfed.org/series/CSUS ... categories

And houses are bigger with more, which means the upper end, more 3500 sq foot new constructions are bringing that index up. They keep getting bigger with more. And Interest rates have remained at historic lows for 10 years now.
They don't need bigger houses - they need houses they can afford. Which they can't.
And there continue to be vehicles we never had

https://www.findmywayhome.com/news/2018-mcc-tax-credit/

https://www.valuepenguin.com/mortgages/ ... gage-rates

You give me no reason to trust your statements. As you say data is not lying.
How is any of this relevant? The data I'm talking about is the fact that they aren't building wealth, forming households, having kids. Not some loan product they can't afford. You are framing everything in your own reality. Not the reality they live in. Lower wages. High debt loads. They can't afford these things even if they have the greatest debt products available to them.
Wages are fucking the general populace. Not just millennials. The wage gap is widening and the millenials are at the widest because they've been in the workforce the shortest amount of time. I don't see your truthful data there that sets them apart. And again and again and again, I think you are hard pressed to find someone who is denying student is a problem.
I think the major point is that they don't have the capacity to deal with the lower wages. They have to invest more up front to earn that lower wage or they'll have to settle for an even lower wage. That is the big picture here. And as others have pointed out they are being driven to making big expensive decisions to deal with these issues before they are ready. It is a systemic problem.

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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 7:06 pm

malchior wrote:
Thu Jun 07, 2018 6:36 pm
stuff

And we are officially talking in circles. I say prices are barely going up and are not at historic highs and part of this increase can attributed to larger housing and you say they don't want larger housing. I add interest rates are in fact at historic lows and first time buyers are given incentives that were never there in the past and you want to know how that's relevant. You say this is my reality when you said the reality is your reality of
The common theme is always that almost all of them are struggling financially. And I'm talking about some folks making relatively good money. It is multi-factorial and complicated but they are dealing with problems we simply didn't face. IMO I can't help but conclude our economy has major issues that are making their lives much worse than their parents and our lives. I get wanting to frame this from our point of view but I encourage anyone interested to actually listen to them and get a deeper understanding. They are being completely shafted this economy. It is a society wide problem.

It is causing all sorts of down the line problems. They aren't building wealth. They aren't buying homes. They aren't having kids. Want to be Japan with completely stagnant growth in 25 years? We just need to keep on this path. It'll eventually happen.

At which point we dance.

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Re: The New Bubble

Post by Kraken » Thu Jun 07, 2018 7:46 pm

Sepiche wrote:
Thu Jun 07, 2018 5:01 pm
malchior wrote:
Thu Jun 07, 2018 4:59 pm
It is causing all sorts of down the line problems. They aren't building wealth. They aren't buying homes. They aren't having kids. Want to be Japan with completely stagnant growth in 25 years? We just need to keep on this path. It'll eventually happen.
Well, we won't completely be Japan until the Trumpers finally cut off all immigration.
QFT. The US fertility rate has been below replacement for quite a few years now and hit a new low last year (1.6, IIRC; replacement is 2.1). Immigration is the only source of population growth in the US, and population growth still drives economic growth. Robotics and AI promise to weaken that relationship, but we ain't there yet.

As for housing, snake people want to live in city centers, where the jobs and culture are. But the housing market hasn't pivoted to reflect that. For decades, suburbs zoned larger and larger lot sizes and the houses kept getting bigger and costlier. Nobody wants those anymore, especially now that the boomers are downsizing. Cities need a lot more dense, transit-centered housing, but most of what's going up is high-end luxury condos, because urban development is expensive and that's where the big money is. Nobody is building starter homes or lower-end apartments anymore. The demand is there, but the money is not.

Boston is cracking down on airBnB rentals because those have taken a substantial share of units off the long-term rental market. I think something like 10% of the city's housing stock is out of play. Our market is also greatly distorted by 70,000 seasonal student renters, but that's a whole different story.

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Re: The New Bubble

Post by LawBeefaroni » Thu Jun 07, 2018 8:04 pm

malchior wrote:
Thu Jun 07, 2018 5:20 pm
LawBeefaroni wrote:
Thu Jun 07, 2018 5:15 pm
malchior wrote:
Thu Jun 07, 2018 4:59 pm

The common theme is always that almost all of them are struggling financially. And I'm talking about some folks making relatively good money. It is multi-factorial and complicated but they are dealing with problems we simply didn't face.
Other than student loans, what else causes this? If you're making good money and not wasting it, how do you struggle financially? And yes, I consider a $4k/month rent to be wasteful if it causes you to struggle.
Their wages are lower and they have more debt load. Housing costs more money. Multi factorial. You don't have to believe me. Look at all the data. The data is not lying. I'm just relating what I hear because it humanizes it but the problems are there. Seriously have a conversation with any group of them - they are universally struggling.
If their wages are lower, what is "relatively good money" as far as earnings?


I know plenty of millennials that are struggling. But they make shit money. Like I know plenty of people from every generation that are struggling due to poor income.

Again I'll ask, what is this debt load they're saddled with? Is it just student loans?
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Re: The New Bubble

Post by malchior » Thu Jun 07, 2018 8:54 pm

LawBeefaroni wrote:
Thu Jun 07, 2018 8:04 pm
malchior wrote:
Thu Jun 07, 2018 5:20 pm
LawBeefaroni wrote:
Thu Jun 07, 2018 5:15 pm
malchior wrote:
Thu Jun 07, 2018 4:59 pm

The common theme is always that almost all of them are struggling financially. And I'm talking about some folks making relatively good money. It is multi-factorial and complicated but they are dealing with problems we simply didn't face.
Other than student loans, what else causes this? If you're making good money and not wasting it, how do you struggle financially? And yes, I consider a $4k/month rent to be wasteful if it causes you to struggle.
Their wages are lower and they have more debt load. Housing costs more money. Multi factorial. You don't have to believe me. Look at all the data. The data is not lying. I'm just relating what I hear because it humanizes it but the problems are there. Seriously have a conversation with any group of them - they are universally struggling.
If their wages are lower, what is "relatively good money" as far as earnings?


I know plenty of millennials that are struggling. But they make shit money. Like I know plenty of people from every generation that are struggling due to poor income.

Again I'll ask, what is this debt load they're saddled with? Is it just student loans?
That'd be the most likely part. The choice is essentially take on debt and make low wages or no debt and have very meager wages. The data suggests they have much higher debt load as percentage of income and I suppose people are splurging on credit cards and cars but that doesn't seem to track. What I was saying about housing was that housing costs have gone up and they in aggregate spend something like 35-40% of their incomes on housing. And then they have that debt load on top. Again the data tells us they are not saving, they are not buying homes, having kids, and are living at home longer. I guess they are all living in the moment and making bad decisions but that doesn't make much sense. There is something bigger happening.

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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 9:06 pm

LawBeefaroni wrote:
Thu Jun 07, 2018 8:04 pm
I know plenty of millennials that are struggling. But they make shit money. Like I know plenty of people from every generation that are struggling due to poor income.

This. And I wonder how people do it in general. I make a top wage, living single with a modest means in a starter home from 1950. I do alright for myself as long a live a modest life. Literally for myself. I don't know people do it. Not just mellenials. They have an additional burden of unprecedented school debt. That is not in doubt as far as I can tell but when challenged to "look at the data" I go right back to having a hard time getting past GGs assessment.
The "pool" of wealth available to fight over and spread around is smaller.
And while I feel for mellenial college debt, I fear for post mellenials. Health care... Student debt and less and less parents able to front load their kids a better life than we had. The top but still not non 1% of the GenEx got their 3500 square foot mausoleum they call home and two new cars very five years and are using a voucher system to get their kids in a subsidized private school. But even they can't afford to send their kids to $40,000 of undergrad and even they look at what happens if they lose corporate sponsored medical care with a bleak fear and see how fast their trust fund could turn on the time. You're part of the working class who's fighting for your share of the smaller portion or you're part benefiting from the fight. That's the data I see over and over.

https://tradingeconomics.com/united-sta ... per-capita
reaching an all time high of 52194.90 USD in 2016
https://www.statista.com/statistics/185 ... y-workers/

The median income in 2016 was $14 or about $29000 plus benes for 40 hour work week.
In 1992 the median income was $7.72 or about $16,000 plus benes for 40 hour work week.

Google says the GDP per capita was 25,492.95 USD (1992)

So we produce twice as much non adjusted wealth but instead of being better rewarded more than twice as much, we are collectively paid about 1.8 times as much. And who are getting most of those increase?

https://www.advisorperspectives.com/dsh ... erspective

And how is that comparing to cost of health care and education and housing and your tax liability and...

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Re: The New Bubble

Post by malchior » Thu Jun 07, 2018 9:11 pm

LordMortis wrote:
Thu Jun 07, 2018 7:06 pm
malchior wrote:
Thu Jun 07, 2018 6:36 pm
stuff

And we are officially talking in circles. I say prices are barely going up and are not at historic highs and part of this increase can attributed to larger housing and you say they don't want larger housing. I add interest rates are in fact at historic lows and first time buyers are given incentives that were never there in the past and you want to know how that's relevant. You say this is my reality when you said the reality is your reality of
We aren't talking in circles - you are ignoring the relevant data. You are hung up in economic dead ends. Find me one survey that shows millennial are looking for big houses in the suburbs. I guarantee you won't. Interest rates are low but even if they wanted to they *don't have the income to buy homes*. And they have too much debt. The interest rate doesn't matter. It is insane to think that they are eager to pile on more debt. And thus the national trend housing data shows they aren't. In fact, they tend to live home longer with their parents.

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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 9:11 pm

malchior wrote:
Thu Jun 07, 2018 8:54 pm
I guess they are all living in the moment and making bad decisions but that doesn't make much sense.
https://www.forbes.com/sites/jefffromm/ ... 1fc971e1f1
Sivley: According to MMGY Global’s Portrait of American Travelers, when it comes to spending intentions for the year ahead across generations, the news is less than positive. For the first time since 2013, travelers report an intention to spend less on travel during the next 12 months than they did during the previous year. Travelers intend to spend an average of $4,815 on vacations during the next 12 months, $18 less than they report having dedicated to leisure travel during the past 12 months. To keep things in perspective, note that last year’s travelers reported spending intentions of $134 more. What this means is that across the approximately 60 million traveling households in the U.S., up to $9.2 billion less will be spent on leisure travel.

Millennials, on the other hand, are likely to spend more. They spent $4,594 on vacations in the past 12 months with an average of $1,312 on each vacation. That is an 8% increase from 2016. Millennials took an average of 3.5 vacations during the past 12 months, and 35% of Millennials intend to take more vacations.

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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 9:19 pm

malchior wrote:
Thu Jun 07, 2018 9:11 pm
We aren't talking in circles - you are ignoring the relevant data. You are hung up in economic dead ends. Find me one survey that shows millennial are looking for big houses in the suburbs. I guarantee you won't. Interest rates are low but even if they wanted to they *don't have the income to buy homes*. And they have too much debt. The interest rate doesn't matter. It is insane to think that they are eager to pile on more debt. And thus the national trend housing data shows they aren't. In fact, they tend to live home longer with their parents.

Take three.

Millennials aren't looking for big houses in the suburbs that I know of. Big houses in the suburbs are driving the average house buying cost up. Starter homes that have been passed from new home owner to new home owner are still cheaper than they were in 2007 as are smaller new homes (as lawbeef states, when you can find them). When the oldest of the mellenials were only in their early 20s entering the housing market before the bubble burst was more expensive than it is now. In addition to this, housing is even cheaper because interest rates remain at historic lows and further, tax credits exist that didn't exist back then.

I actual provide data to show these exact phenomena and you ask me how it's relevant.

This is exactly circles.

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Re: The New Bubble

Post by malchior » Thu Jun 07, 2018 9:27 pm

LordMortis wrote:
Thu Jun 07, 2018 9:19 pm
malchior wrote:
Thu Jun 07, 2018 9:11 pm
We aren't talking in circles - you are ignoring the relevant data. You are hung up in economic dead ends. Find me one survey that shows millennial are looking for big houses in the suburbs. I guarantee you won't. Interest rates are low but even if they wanted to they *don't have the income to buy homes*. And they have too much debt. The interest rate doesn't matter. It is insane to think that they are eager to pile on more debt. And thus the national trend housing data shows they aren't. In fact, they tend to live home longer with their parents.

Take three.

Millennials aren't looking for big houses in the suburbs that I know of. Big houses in the suburbs are driving the average house buying cost up. Starter homes that have been passed from new home owner to new home owner are still cheaper than they were in 2007 as are smaller new homes (as lawbeef states, when you can find them). When the oldest of the mellenials were only in their early 20s entering the housing market before the bubble burst was more expensive than it is now. In addition to this, housing is even cheaper because interest rates remain at historic lows and further, tax credits exist that didn't exist back then.

I actual provide data to show these exact phenomena and you ask me how it's relevant.

This is exactly circles.
I think the trouble is I can't parse out what you are arguing. On one hand you are saying big houses are driving up prices and then saying that starter homes are cheaper than 2007. Why is this relevant? I can't figure it out. Again the data shows they aren't buying houses. I have a hint to think you are arguing that is a choice. I think that is probably not the right line considering all the incentives to do so you are pointing out.

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Re: The New Bubble

Post by LordMortis » Thu Jun 07, 2018 9:44 pm

malchior wrote:
Thu Jun 07, 2018 9:27 pm
Why is this relevant? .
Big suburban housing and urban hotspot housing makes the market look more expensive than it is. Late 20 something first time buyers looking for these things is going to leave them... not buying houses.
Again the data shows they aren't buying houses.
Is not the same as
*don't have the income to buy homes*.
This looked interesting to me.

https://www.census.gov/data/tables/time ... eople.html

It looks like median income for people aged 25-34 peaked in 1973. It has been on a dramatic upturn since 2011 and on par with the last three decades but nothing close the better years in the 70s.

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Re: The New Bubble

Post by GreenGoo » Thu Jun 07, 2018 10:56 pm

noxiousdog wrote:
Thu Jun 07, 2018 6:19 pm


Income is linear. If I get paid 50k. I get 50k. Next year I get 50k. etc. In 20 years, i have 1 million.

Wealth (at these levels) is exponential. At 7% returns it doubles every 10 years roughly. The guys that are doing private investments are looking for 20% ROI. They can double every 3 years. They don't pay tax until they sell, and then it's at 15% if they ever do.

But all that is still income. You don't start with zero and have a billion in 10 years without getting there somehow. Those 7% returns are (or should be) taxed. I get that wealth generates more wealth and the more wealth you have the more you can generate, but income taxes (covering whatever form of wealth generation being used) should cover that, no?

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Re: The New Bubble

Post by noxiousdog » Thu Jun 07, 2018 11:05 pm


GreenGoo wrote:
noxiousdog wrote:
Thu Jun 07, 2018 6:19 pm


Income is linear. If I get paid 50k. I get 50k. Next year I get 50k. etc. In 20 years, i have 1 million.

Wealth (at these levels) is exponential. At 7% returns it doubles every 10 years roughly. The guys that are doing private investments are looking for 20% ROI. They can double every 3 years. They don't pay tax until they sell, and then it's at 15% if they ever do.

But all that is still income. You don't start with zero and have a billion in 10 years without getting there somehow. Those 7% returns are (or should be) taxed. I get that wealth generates more wealth and the more wealth you have the more you can generate, but income taxes (covering whatever form of wealth generation being used) should cover that, no?
No, for two reasons. Those 7% (or more) returns aren't taxed until you sell and then it's taxed at 15%. That's all capital gains.

Also, the guys we are talking about made their own companies. They aren't mega rich because they had an income, they are mega rich because they either had an idea or organized other people that had ideas.



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Re: The New Bubble

Post by Kraken » Thu Jun 07, 2018 11:10 pm

GreenGoo wrote:
Thu Jun 07, 2018 10:56 pm
noxiousdog wrote:
Thu Jun 07, 2018 6:19 pm


Income is linear. If I get paid 50k. I get 50k. Next year I get 50k. etc. In 20 years, i have 1 million.

Wealth (at these levels) is exponential. At 7% returns it doubles every 10 years roughly. The guys that are doing private investments are looking for 20% ROI. They can double every 3 years. They don't pay tax until they sell, and then it's at 15% if they ever do.

But all that is still income. You don't start with zero and have a billion in 10 years without getting there somehow. Those 7% returns are (or should be) taxed. I get that wealth generates more wealth and the more wealth you have the more you can generate, but income taxes (covering whatever form of wealth generation being used) should cover that, no?
Capital gains (money making money) are taxed lower than earned income (you making money) and not subject to payroll taxes at all. You'd think it would be the other way around, but you pay a LOT more taxes on money you work for than on money you conjure from thin air.

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Re: The New Bubble

Post by GreenGoo » Thu Jun 07, 2018 11:24 pm

There's nothing magical about straight income tax rates that make capital gains tax rates "too low" for the basis of our conversation.

Different income types are taxed at different rates. So what? That doesn't inherently mean anything (good/bad/right amount/wrong amount) given wealth redistribution is the topic.

I absolutely understand that startups can result in hitting the wealth lottery, what I don't understand is why this is a problem or how this wealth creation avoids the taxman.

If I'm the primary stock owner then capital gains should apply. As ND says, taxes don't kick in until the stock is sold, but that's fine since the wealth generation only exists on paper until it is actualised through the sale of stock.

What am I missing?

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Re: The New Bubble

Post by Zarathud » Fri Jun 08, 2018 2:39 am

GreenGoo wrote:Well...yeah. Most 1st world countries have some sort of wealth redistribution system so it doesn't *all* just pile up at the top. As you point out, that's the natural outcome.

Actually, I think you mean tax on wealth and not wealth generation. If that's the case...how would that work? Why wouldn't the various forms of income tax (be it straight income, capital gains, dividends, what have you) be enough? Is your concern privately owned (or at least majority owned by individuals) businesses? I'm struggling to think of wealth accumulation that is not covered by current tax law. Presumably they get around those laws somehow?

What say you, Zarathud?
The wealthy pay tax at lower rates due to design in the tax code, even before anyone sees wealth planning counsel. Capital gains maxes out at 15/20%. Not so for wages. Keep an asset until you die and pay zero income tax....until you have $11.2 million (or $22.4 million if married) then you're at risk of federal estate tax. Own certain businesses and your taxable income is reduced by 20% due to the Trump tax law. The Trump tax law alone will accelerate $2.3 trillion in wealth transfers.

There is huge insecurity by the wealthy over what the economy will mean for their children, and trusts and education/health/income is being provided to preserve the oligarchy. They're acting now.

That's without considering the other advantages of growing up with opportunities and security. Getting into a country club or wealthy circles will still open up big funding, investment and business opportunities. The new business culture of "disruption" and "risking failure" presumes that the leadership will have security and safety nets that come from wealth or privilege.

The fix? It's simple. Reverse a favorable tax structure and tax the biggest wealth transfers in history as the WWII and Baby Boom generations die off. Make education/work pay again, without crushing debt. Make healthcare affordable and available. Repair infrastructure so you can profit in the Red States that devalued education without screwing over labor.

The Democrats are TERRIBLE at explaining how this works. The Kochs and other Republicans have been brilliant turning social issues into firewalls and eroding potential fulcrums of change.
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Re: The New Bubble

Post by LordMortis » Fri Jun 08, 2018 6:47 am

Make education/work pay again, without crushing debt. Make healthcare affordable and available. Repair infrastructure so you can profit in the Red States that devalued education without screwing over labor.
How often do you and I agree about something political? My goodness!!!! (This assuming you broaden education beyond beyond traditional visions of college/university. Education is failing the trades as much as it if failing college graduates without plan which feeds "repair infrastructure")

It's been our need 20 years and something we should have been focusing on for 30 years ago before it started becoming a need. We're just moving from need to critical.

There are plenty of ideas on the table being ignored for how to make healthcare affordable. I'm not seeing a whole lot for education, other than more taxes (subsidies), which I do not think is even half a solution much less a whole solution.

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Re: The New Bubble

Post by noxiousdog » Fri Jun 08, 2018 11:01 am

Kraken wrote:
Thu Jun 07, 2018 11:10 pm
Capital gains (money making money) are taxed lower than earned income (you making money) and not subject to payroll taxes at all. You'd think it would be the other way around, but you pay a LOT more taxes on money you work for than on money you conjure from thin air.
It's because capital is more important for economies than wages. Capital allows productivity improvements whereas wages does not.

This isn't a trickle down thing. The interstate highway system is a capital improvement. Anything that facilitates a multiplier on your productivity: computers, tools, refrigeration, vehicles etc.

That's not to discount wages and the velocity of money. I absolutely think we need a better balance. I would like to see corporations before forced to distribute much more of their income to shareholders which would then be taxed at standard income levels.
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Re: The New Bubble

Post by Smoove_B » Fri Jul 20, 2018 4:42 pm

Can't stomach the idea of loans? No problem - just give us a cut of your future salary.
In contrast with traditional loans, in which students will simply pay down the principal and interest until there is nothing left, students with income share agreements pay back a percentage of their salary for a set period of time. Those touting the programs say they give colleges greater incentive to help students find high-earning jobs after graduation, because a higher salary means the school may recoup its investment in a shorter period of time.

For some students, income share agreements are seen as less risky, especially if they end up in a lower-paying job or struggle to find work after graduation. While students are unemployed or earning below a certain threshold they don’t have to pay anything back.

“Taking on the debt through a contract, where you don’t take on a debt per se but instead will repay a portion of your future income, has a certain appeal to students when the concept is fully explained to them,” said Clare McCann, deputy director for education policy at the New America Foundation.

But because employment and salary determine repayment, it’s possible providers could be seen as discriminating against recipients who choose lower-paying professions.

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Re: The New Bubble

Post by Kraken » Fri Jul 20, 2018 5:39 pm

Indentured servitude...what a novel idea.

Here's another one that has nothing to do with bubbles: Investors want a share of your house.
What if, instead of taking out a home equity loan from a bank, you could ask Wall Street to invest in your house?

You’d get cash upfront, and if the value of your home went up, the investors would get their money back, plus a profit. If the value of your home fell, the investors would earn less or maybe even absorb a loss.

That’s the idea behind a new crop of venture-backed startups hoping to make money by betting real estate values will continue to climb in selected markets around the country. It’s called “equity sharing,” and the entrepreneurs behind these companies say it serves an unmet need for homeowners who want to capitalize on their biggest asset — without selling or taking on monthly loan payments.

“They’ve got this value, but they can’t touch it,” said Jeffrey Glass, a veteran tech executive and CEO of Hometap, a Cambridge startup that recently began offering equity sharing in Massachusetts. “People are house-rich and cash-poor like never before.”
I'm sure that will end well.

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Re: The New Bubble

Post by RunningMn9 » Sun Jul 22, 2018 8:49 am

Isn’t that the idea behind Oregon’s (or some state) plan for free college? They just take a portion of your salary for like 20 years or something.
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Re: The New Bubble

Post by Drazzil » Thu Aug 23, 2018 12:20 am

Smoove_B wrote:
Fri Jul 20, 2018 4:42 pm
Can't stomach the idea of loans? No problem - just give us a cut of your future salary.
In contrast with traditional loans, in which students will simply pay down the principal and interest until there is nothing left, students with income share agreements pay back a percentage of their salary for a set period of time. Those touting the programs say they give colleges greater incentive to help students find high-earning jobs after graduation, because a higher salary means the school may recoup its investment in a shorter period of time.

For some students, income share agreements are seen as less risky, especially if they end up in a lower-paying job or struggle to find work after graduation. While students are unemployed or earning below a certain threshold they don’t have to pay anything back.

“Taking on the debt through a contract, where you don’t take on a debt per se but instead will repay a portion of your future income, has a certain appeal to students when the concept is fully explained to them,” said Clare McCann, deputy director for education policy at the New America Foundation.

But because employment and salary determine repayment, it’s possible providers could be seen as discriminating against recipients who choose lower-paying professions.
It's *not* a terrible idea, but could easily become abusive.
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Re: The New Bubble

Post by Smoove_B » Sun Aug 26, 2018 1:27 pm

From the opinion pages of the NYT:
Consider the official statistics: Of borrowers who started repaying in 2012, just over 10 percent had defaulted three years later. That’s not too bad — but it’s not the whole story. Federal data never before released shows that the default rate continued climbing to 16 percent over the next two years, after official tracking ended, meaning more than 841,000 borrowers were in default. Nearly as many were severely delinquent or not repaying their loans (for reasons besides going back to school or being in the military). The share of students facing serious struggles rose to 30 percent over all.

...

The secret to avoiding accountability? Colleges are aggressively pushing borrowers to use repayment options known as deferments or forbearances that allow borrowers to stop their payments without going into delinquency or defaulting. Nearly 20 percent of borrowers at schools that had high default rates at year five but not at year three used one of these payment-pausing options.

...



The federal government cannot keep turning a blind eye while almost one-third of student loan borrowers struggle. Fortunately, efforts to rewrite federal higher-education laws present an opportunity to address these shortcomings. This should include losing federal aid if borrowers are not repaying their loans — even if they do not default. Loan performance should also be tracked for at least five years instead of three.

The federal government, states and institutions also need to make significant investments in college affordability to reduce the number of students who need a loan in the first place. Too many borrowers and defaulters are low-income students, the very people who would receive only grant aid under a rational system for college financing. Forcing these students to borrow has turned one of America’s best investments in socioeconomic mobility — college — into a debt trap for far too many.

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Re: The New Bubble

Post by GreenGoo » Sun Aug 26, 2018 1:34 pm

Which is worse in the long term? Buried in debt or no education? Because that's what I'm hearing in the quoted text, excepting the last paragraph.

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