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[Enron]

Those anti-capitalist plebs bought a place to live in a free market society. How fucking dare they.

Where the hell did that come from?

The simple fact is, when a home is the majority of your wealth and housing prices plummet, then that explains the OP. In fact, it's even mentioned in the article that the OP linked. Did you mean to reply to someone else?

People talking about diversifying. You try diversifying while making 30k a year. The reality is, when your family is barely making any money, the only investment you can make is a house.

While that may be true, diversifying any leftover savings/investments is always a good plan, no matter how little money you have.

I even said that in this example (middle-class homebuying) it might not have mattered, though. What the hell is wrong with the OT this morning? You guys are in ATTACK MODE and aren't even taking care to read posts beyond a glance before unleashing TEH INTERNET FURIES

 

[gatti-man]

People talking about diversifying. You try diversifying while making 30k a year. The reality is, when your family is barely making any money, the only investment you can make is a house.

I make 70k a year and could never dream of home ownership at 30k. I live in a cheap house too.

Where the hell did that come from?

The simple fact is, when a home is the majority of your wealth and housing prices plummet, then that explains the OP. In fact, it's even mentioned in the article that the OP linked. Did you mean to reply to someone else?

The 30%-40% drop in home values doesnt account for the giant drop in wealth. Plus you are assuming this bottom half owns homes when most are young renters I would imagine.

 

[mugurumakensei]

While that may be true, diversifying any leftover savings/investments is always a good plan, no matter how little money you have.

Not really unless you call just savings accounts and government bonds diversifying. Small investments in anything else means you are more heavily impacted from brokerage fees.

 

[Enron]

I make 70k a year and could never dream of home ownership at 30k. I live in a cheap house too.



The 30%-40% drop in home values doesnt account for the giant drop in wealth. Plus you are assuming this bottom half owns homes when most are young renters I would imagine.

Since you couldn't be bothered to actually read the article that the OP linked

The study cites a recent Federal Reserve Bulletin article's conclusion that "a broad collapse in house prices” was the main reason for the changes between 2007 and 2010. The decline in the stock market "played a considerable but lesser role" in part because stock prices, unlike home prices, have broadly recovered.

I am not assuming anything. It's all right there in the article in the OP!

 

[BigDug13]

I think a lot of the back and forth in this thread is also coming from the mentality that renting is throwing your money away, so the paradigm of the conversation is that everyone needs to buy their home in order to at least have some kind of investment. That's simply not true.

 

[Binabik15]

Who needs a house when you have a well-diversified portfolio?

*uses newspaper as shelter against the rain*


The death of the middle class seems a very possible outcome of politics of the last decades. Which might be not surprising, as the existence of a strong middle class is an outlier when you look at history. And what has a strong middle class given us? Nothing but prosperity, peace* and massive leaps in minority integration and education.

Good thing that the super rich and their corporations are so willingly working against THAT.

*peace in the EU, at least, we can't be blamed that the US is bombing other countries or former Soviet satelite states have internal strife, but the later didn't have a strong middle class after the Soviets came

 

[Ash Sparrow]

I dont think i'm voting this time, non of these guys seem to have our interest at heart.

 

[Rebel Leader]

I dont think i'm voting this time, non of these guys seem to have our interest at heart.

The only difference is one has the symbol of a jackass and the other a big ass

 

[Azih]

Truth Once, Always The Truth™

Why do you think anything changed in 100 years, USA?

This was published in USA in 1911 BTW.

Well the shoot at you should be in the second lowest rung now (and include the police) and the eat for you should be the second from the top leaving the fool you to the third rung (and include media types as well as clergy).

 

[Binabik15]

I dont think i'm voting this time, non of these guys seem to have our interest at heart.

Vote for a third party, not because they'll win, but because a huge chunk of votes going to a third block of one or several small parties should put pressure on the big two to behave better.

 

[Azih]

Ding Ding Ding Ding.

People sink all their savings into their home and then blame the 1% when its value crashes. Just for reference, anyone with their money in well-diversified portfolios have likely recovered all their losses from the 2008 crash, provided they didn't buy right at the very peak in 2008. Can't say the same for homes, which will take a very long time to recover.

Really? People need a place to live (you know a HOME) considering wage stagnation that means either a large chunk of a paycheque going to rent or into a mortgage. How the fuck do you expect anyone to invest in a 'well diversified portfolio' ESPECIALLY when you factor in massive student debts for many and perhaps medical bills?

Edit: Did we just get AstroLadded here? It's such an absurd point to try to make.

 

[Ptaaty]

I still can't believe anyone would vote for republicans at this point...still fighting any type of wealth distribution, opposing the increases on taxes (or just reduced cuts) for those over $250k.

While the whole idea that if you earned it...it should be yours to do what you will with it seems right, the problem is that everything is stacked in favor of the rich. Not only the usual lower percentage on necessarily, but the low rates on capital gains.

The poor aren't really taxed (credits, etc) at the federal level and get more assistance - but even this is skewed, assistance should be for basics like medical coverage.

You know who really gets hosed? The middle class - the highest effective tax rate by far, bad enough that many poor have zero incentive, and the straps hold you back from being one of the rich.

 

[TheRagnCajun]

Look, all I'm suggesting is:

-America overbought on housing. Homeownership rates peaked, price to income ratios peaked, household debt levels peaked. All of this means that we overleveraged in housing. People were spending beyond their means, compared to history.

-Contrary to boomer belief, housing doesn't always go up, and its not a safe investment. I'm pretty sure the only ones to blame for propogating this myth is boomers and realtors.

-Homeownership is not a human right, many people around the world get by renting. Infact, it is supposed to be cheaper than owning a home, contrary to popular belief. Don't forget that with owning a home you have land tax, insurance, maintenance, and the carrying costs of the mortgage.

-Having an investment portfolio is ultimately best wealth-growing option for anyone, regardless of income. If you can't afford a home and an investment portfolio, sell the house. An investment portfolio doesn't have hefty upkeep costs, hefty transaction fees, it doesn't turn illiquid, and it has proven to grow in value on average 7% per year.

Edit:...And this discussion is about 'what happened to the middleclass wealth?' If your household income is 30K i don't think you constitute as middleclass to begin with. 'Middleclass' by definition should have a little more money than just to get by.

 

[-COOLIO-]

fucked up. somethings gunna have to change

 

[aceface]

The closer you are to an unfettered free market, the more that the gap between the rich and poor increases. This has been shown time and again throughout history yet people forget it. Today we have mass media controlled by corporate interests brainwashing people into believing that less government is a good thing. It's so transparent.

 

[Azih]

Look, all I'm suggesting is:

-America overbought on housing. Homeownership rates peaked, price to income ratios peaked, household debt levels peaked. All of this means that we overleveraged in housing. People were spending beyond their means, compared to history.... Contrary to boomer belief, housing doesn't always go up, and its not a safe investment. I'm pretty sure the only ones to blame for propogating this myth is boomers and realtors.... Homeownership is not a human right, many people around the world get by renting. Infact, it is supposed to be cheaper than owning a home, contrary to popular belief.

Well I agree with this but a lot of the myth of you MUST OWN A HOME comes from all sorts of financial advisors and banks and the media.

and it has proven to grow in value on average 7% per year.

This seems as absurd to me as the myth that house prices always go up.

Plus you're ignoring the burden of student debts and medial expenses on the middle class as well.

 

[Partial Gamification]

Truth Once, Always The Truth™

Why do you think anything changed in 100 years, USA?

One-Hundred years ago women could not vote. Historical periods are cyclical and it is my hope that the corruption has peaked, or plateaued, and will begin to subside (it will never go away completely - in any system). It is too easy to be pessimistic and apply simplified critiques to complex dynamics. People have the potential to unite on a social-justice front and redress their grievances in front of government. Divergent interests are secondary to common goals. It is foolish to claim "nothing has changed," in any interval of time. Things are constantly changing.

 

[balladofwindfishes]

If you can't afford a home and an investment portfolio, sell the house.

a portfolio you can't hold, you can't make it your own. You can't bring people to it, show them it, you get make it a "home base" free from the trials of the world. You can't raise a family and make money in a portfolio

Raw capitalism forgets the human side of the argument. There's a very strong emotional connection to having a home, something we as humans have had forever. We need a permanent nest, that's how we best function

So while a portfolio might seem like a raw better deal, it carries no personal emotional value at all, something a home has.

 

[Kabouter]

One-Hundred years ago women could not vote. Historical periods are cyclical and it is my hope that the corruption has peaked, or plateaued, and will begin to subside (it will never go away completely - in any system). It is too easy to be pessimistic and apply simplified critiques to complex dynamics. People have the potential to unite on a social-justice front and redress their grievances in front of government. Divergent interests are secondary to common goals. It is foolish to claim "nothing has changed," in any interval of time. Things are constantly changing.

Thank heavens this popular myth is not true. Humans always try to find patterns in everything, but that doesn't mean one is there.

 

[Captain Sparrow]

Wealth is a BS argument, and there are many ways to skew it. For example, everyone spends and saves differently.

Here is the real article everyone should be reading instead of all this "1%" doom and gloom nonsense

http://www.washingtonpost.com/local/most-americans-earn-more-than-parents-but-only-
a-third-rise-in-income-class-study-says/2012/07/09/gJQAOWyzYW_story.html

The article explains how upward mobility is harder. However, 84% of Americans earn more than their parents

Am I going to deny that the super-rich are in fact, super-rich? No.

It is a fact that we consume more non-essentials than every before

Everyone has the right to go tanning, get a cell phone (every year), colorful cases for the phone, new car, new $200 jeanns, $5 mocha choca latte vanilla bean cream, cigarettes, hair color, tablets, video games, high speed internet, premium cable channels, and beer, to name a few.

So no, I am not suprised some people never amount to anything. You will never be able to help some people. Articles like the OP posted keep the entitlement justified.

 

[Kettch]

It's all socialism until one person has all the wealth. Keep cuttin' them taxes!

 

[Partial Gamification]

Thank heavens this popular myth is not true. Humans always try to find patterns in everything, but that doesn't mean one is there.

I agree to an extent. The terms of elected officials do create a cycle, definitely not regular but a pattern nonetheless. Reactionary voting re-inforces this; much like the rise of the TeaParty in the wake of Obama.

 

[TheRagnCajun]

a portfolio you can't hold, you can't make it your own. You can't bring people to it, show them it, you get make it a "home base" free from the trials of the world. You can't raise a family and make money in a portfolio

Raw capitalism forgets the human side of the argument. There's a very strong emotional connection to having a home, something we as humans have had forever. We need a permanent nest, that's how we best function

So while a portfolio might seem like a raw better deal, it carries no personal emotional value at all, something a home has.

Realestate is the most emotional of assets. There are plenty of good reasons to own one, but investment shouldn't be one of them.

 

[Micerider]

Look, all I'm suggesting is:

-America overbought on housing. Homeownership rates peaked, price to income ratios peaked, household debt levels peaked. All of this means that we overleveraged in housing. People were spending beyond their means, compared to history.

-Contrary to boomer belief, housing doesn't always go up, and its not a safe investment. I'm pretty sure the only ones to blame for propogating this myth is boomers and realtors.

-Homeownership is not a human right, many people around the world get by renting. Infact, it is supposed to be cheaper than owning a home, contrary to popular belief. Don't forget that with owning a home you have land tax, insurance, maintenance, and the carrying costs of the mortgage.

-Having an investment portfolio is ultimately best wealth-growing option for anyone, regardless of income. If you can't afford a home and an investment portfolio, sell the house. An investment portfolio doesn't have hefty upkeep costs, hefty transaction fees, it doesn't turn illiquid, and it has proven to grow in value on average 7% per year.

Edit:...And this discussion is about 'what happened to the middleclass wealth?' If your household income is 30K i don't think you constitute as middleclass to begin with. 'Middleclass' by definition should have a little more money than just to get by.

You're mistaking the sources, context and consequences. Those who generated the mortgage boom are not the one who decided to purchase the houses. If you manage to have an agressive rate in the market by creating insane debt structures that can flow "below the radar" in the global market as far as risk is concern, of course you will generate a boom, as everyone can, for a short period of time "afford" a house.

Don't think the one that are suffering from the crisis have taken a "knowing" decision. That was not the case, everybody was blind at the time and very few were aware of what could lie between the lines.

Edit : and renting was not much cheaper than buying at the time, that's the matter.

 

[Angry Fork]

These kinds of threads aggravate me because I agree with the sentiment and a lot of people post in them saying yup this sucks something has got to change this is terrible, oligarchy dominating everything etc. bla bla

But then in poligaf thread everyone just says vote Obama, as if sticking with corporate capitalism is still the way to go? I get the whole vote for less evil thing but nobody on gaf except a few people like empty vessel wants to talk about ideas for entirely new/different socioeconomic systems.

If you want to say vote for Obama because he's not as bad as Romney that's fine but why not in the mean time also discuss what could work better than capitalism, what absolutely doesn't work and why it doesn't, talk about history and how ordinary people would react to dramatic change, etc. I wish there was a thread dedicated to this stuff since nobody talks about such things in poligaf.

 

[Chrono]

It has been a plutocracy for a while.

Serfs will continue mocking the OWS hippies, though.

I wouldn't laugh at the 'OWS hippies' if they were consistent and knew what the fuck they're talking about. You can't help but laugh when millionaire 'rap mogul' goes down to join the protest with fellow millionairess/progressives like michael moore.

Here's an idea, the people at the top of the pyramid include the western middle class and poor as far as the world's real poor are concerned. Watching idiots demand the rich give them their money because they feel they're entitled to it while genuinely poor people around the world struggle to put food on the table pretty much sums up the left. by your own narrative, you dumbasses are the parasite elite taking THEIR - the poor indians and africans - money. You know, the whole world is your family and compassion and all that.

It'd be funny to make a list of posters alternating between posting pictures of useless expensive garbage they bought on the latest pick-up threads and ranting about serfs and slaves and the evil elite parasites feeding on the helpless and innocent world.

By the way, aren't you a spaniard and football fan? I don't read much of the football threads but I think I've seen you cheering on Spain. Start by stopping giving money away to the elite athletes and corporations that organize the games and use that time and money for your cause instead of buying ronaldo a new car. Serfs? Fuck off.

Average US voter(s)

http://www.youtube.com/watch?v=Bg98BvqUvCc

 

[Dead Man]

That is a horribly depressing statistic to read.

 

[Baraka in the White House]

I wouldn't laugh at the 'OWS hippies' if they were consistent and knew what the fuck they're talking about. You can't help but laugh when millionaire 'rap mogul' goes down to join the protest with fellow millionairess/progressives like michael moore.

Here's an idea, the people at the top of the pyramid include the western middle class and poor as far as the world's real poor are concerned. Watching idiots demand the rich give them their money because they feel they're entitled to it while genuinely poor people around the world struggle to put food on the table pretty much sums up the left. by your own narrative, you dumbasses are the parasite elite taking THEIR - the poor indians and africans - money. You know, the whole world is your family and compassion and all that.

It'd be funny to make a list of posters alternating between posting pictures of useless expensive garbage they bought on the latest pick-up threads and ranting about serfs and slaves and the evil elite parasites feeding on the helpless and innocent world.

By the way, aren't you a spaniard and football fan? I don't read much of the football threads but I think I've seen you cheering on Spain. Start by stopping giving money away to the elite athletes and corporations that organize the games and use that time and money for your cause instead of buying ronaldo a new car. Serfs? Fuck off.

Ah yes, the,"If you don't live in Somalia then quit bitching," argument.

 

[Dead Man]

I wouldn't laugh at the 'OWS hippies' if they were consistent and knew what the fuck they're talking about. You can't help but laugh when millionaire 'rap mogul' goes down to join the protest with fellow millionairess/progressives like michael moore.

Here's an idea, the people at the top of the pyramid include the western middle class and poor as far as the world's real poor are concerned. Watching idiots demand the rich give them their money because they feel they're entitled to it while genuinely poor people around the world struggle to put food on the table pretty much sums up the left. by your own narrative, you dumbasses are the parasite elite taking THEIR - the poor indians and africans - money. You know, the whole world is your family and compassion and all that.

It'd be funny to make a list of posters alternating between posting pictures of useless expensive garbage they bought on the latest pick-up threads and ranting about serfs and slaves and the evil elite parasites feeding on the helpless and innocent world.

By the way, aren't you a spaniard and football fan? I don't read much of the football threads but I think I've seen you cheering on Spain. Start by stopping giving money away to the elite athletes and corporations that organize the games and use that time and money for your cause instead of buying ronaldo a new car. Serfs? Fuck off.



http://www.youtube.com/watch?v=Bg98BvqUvCc

Cost of living. Look it up.

 

[Sealda]

Average US voter(s)

This is amazing. Worse than a parody.

Unlike the rest of the world, the poor people in USA do vote for even more right-wing.

 

[Funky Papa]

By the way, aren't you a spaniard

Yes.

and football fan?

No. I only follow the national squad during the biggest events and mostly because GAF makes it lulzy.

Start by stopping giving money away to the elite athletes and corporations that organize the games and use that time and money for your cause instead of buying ronaldo a new car.

If I had the chance I'd burn every single football club to the ground. They are parasites and I'd rank their blind supporters barely above vermin.

Serfs?

Yes.

Fuck off.

But I've just had a wank.

 

[Bgamer90]

Average US voter(s)

Man...

Hard to watch but it's a sad reality. Many don't realize that they are constantly getting screwed.

 

[ToxicAdam]

I get the whole vote for less evil thing but nobody on gaf except a few people like empty vessel wants to talk about ideas for entirely new/different socioeconomic systems.

There are plenty of libertarians on GAF that will engage you in fantasy political talk. The rest of the people want to talk about the real world and what is happening in it.

 

[Angry Fork]

I wouldn't laugh at the 'OWS hippies' if they were consistent and knew what the fuck they're talking about. You can't help but laugh when millionaire 'rap mogul' goes down to join the protest with fellow millionairess/progressives like michael moore.

Here's an idea, the people at the top of the pyramid include the western middle class and poor as far as the world's real poor are concerned. Watching idiots demand the rich give them their money because they feel they're entitled to it while genuinely poor people around the world struggle to put food on the table pretty much sums up the left. by your own narrative, you dumbasses are the parasite elite taking THEIR - the poor indians and africans - money. You know, the whole world is your family and compassion and all that.

It'd be funny to make a list of posters alternating between posting pictures of useless expensive garbage they bought on the latest pick-up threads and ranting about serfs and slaves and the evil elite parasites feeding on the helpless and innocent world.

By the way, aren't you a spaniard and football fan? I don't read much of the football threads but I think I've seen you cheering on Spain. Start by stopping giving money away to the elite athletes and corporations that organize the games and use that time and money for your cause instead of buying ronaldo a new car. Serfs? Fuck off.

I completely agree with you on the rich famous person joining the cause shit. I don't like it but we don't know how people think and what they really feel. Angelina Jolie is incredibly rich and likely wasteful with multiple homes and all that but she seems to legitimately care about fucked up shit that happens to kids overseas, donates a lot of money, adopts some, makes movies and does interviews to spread awareness etc. That may just be psuedo intellectual liberal garbage but it does something more than nothing so it's somehwat useful. Bill Gates is the same I wouldn't consider him an evil man. But people like them are part of the problem imo even if they're not Bernie Madoff and they only represent capitalism with a human face.

As far as OWS 'demanding money from rich', that's not what it is about at all and if you think that's what it is you've dranken some kool aid somewhere. Are there entitled douchebag idiots at OWS? Of course, but you can't say OWS is pointless when it dramatically changed the scope of political talking points from stupid tea party racist bullshit to the more sensical income inequality debate. It is the beginning (hopefully) of a resurrgance in leftist thought when our country has been going further and further right since Reagan. It's the beginning of trying to balance the scale and the fact that countries all over the world have expressed solidarity with the movement shows it has potential for much more grand ideas than 'i'm jealous of your ferrarri and I want one so gimme gimme!' propoganda bs.

Also the 'things can always be worse' argument really does not hold up. Suffering can be relative and obviously middle class in America would be considered rich in many countries that doesn't mean anything to the big picture. Income inequality in America is now reaching the ranks of China and more people are in it's prisons than Stalin had during his dictatorship. There's also the ideas begining to flurry again about workers controlling/owning the means of production and thinking about ways to overcome capitalism all together. There are strands of the OWS movement that think about this now where as before nobody ever did except intellectuals and history buffs. It isn't the majority of OWS but it's better than nothing. There is obviously a line though that must be drawn where you have to say okay this is too rich, nobody needs this much. I know where I think that line should be but obviously it would be very different in a place like Cuba and standards are higher/lower depending where you are.

And last point about contributing to big corporations, there's often no other choice. A similar argument is brought out when people say 'well if you hate capitalism so much stop working then just move to Cuba!' as if that solves anything in America. People have to still work to survive in the country they were born in and know, and although they may not like the system it's what they have to deal with now. Computers and the internet are necessary to do an infinite number of things to better yourself and contribute to society. Yes it is dreadful that some foxconn workers commit suicide because of the bad conditions and the fact that they spend 16+ hours a day making chips that people here use to go on facebook to complain about their recent breakup with their boyfriend/girlfriend. Yes that sucks but unless we learn chinese and go over there (which wouldn't do anything anyway), there's not much we can do about that.

There are plenty of libertarians on GAF that will engage you in fantasy political talk. The rest of the people want to talk about the real world and what is happening in it.

The 20th century proved big ideas could be enacted in the real world. They may not be ideas that worked to people's satisfaction but they were implemented and new ones will be in the future. There's no reason why you can't both talk about large scale alternatives, grassroots movements etc. while also spewing the same regurgitated nonsense about obama vs. romney (which I do also btw because it's fun, I'm not saying it doesn't have it's place within a conversation).

 

[RJT]

The tax system needs a fucking do-over. The tolerance for tax havens and the low tax on capital gains are absolutely scandalous.

To quote Adam Smith: "It is not very unreasonable that the rich should contribute to the public expence, not only in proportion to their revenue, but something more than in that proportion."

 

[Chrono]

snip.

Wow, sports-GAF = vermin? And you have no problem with hanging out with those people in those threads for 'lulz' too, heh. I guess it's not too different than a religious GAFer that thinks most posters here are animals that will go to hell, but still posts and is a member of the community. Not sure if that makes you a hypocrites, but whatever. You definitely are however a hypocrite for saying you'd burn football clubs to the ground and yet watch your national team. Or wait, perhaps you'd burn those athletes in the team to the ground too if you could? You're beneath vermin.

 

[heliosRAzi]

Wow, sports-GAF = vermin? And you have no problem with hanging out with those people in those threads for 'lulz' too, heh. I guess it's not too different than a religious GAFer that thinks most posters here are animals that will go to hell, but still posts and is a member of the community. Not sure if that makes you a hypocrites, but whatever. You definitely are however a hypocrite for saying you'd burn football clubs to the ground and yet watch your national team. Or wait, perhaps you'd burn those athletes in the team to the ground too if you could? You're beneath vermin.

Well this is certainly a distracting post

 

[Funky Papa]

Wow, sports-GAF = vermin? And you have no problem with hanging out with those people in those threads for 'lulz' too, heh. I guess it's not too different than a religious GAFer that thinks most posters here are animals that will go to hell, but still posts and is a member of the community. Not sure if that makes you a hypocrites, but whatever. You definitely are however a hypocrite for saying you'd burn football clubs to the ground and yet watch your national team. Or wait, perhaps you'd burn those athletes in the team to the ground too if you could? You're beneath vermin.

I said blind supporters. I actually took the special care to use the word "blind" not to put every fan in the same bucket.

Get your head out of your arse and stop twisting my words.

 

[ffdgh]

Not surprising but still depressing...

 

[Sanky Panky]

Realestate is the most emotional of assets. There are plenty of good reasons to own one, but investment shouldn't be one of them.

Our generation is now skewed against investing in real estate, but this is one very misguided sentiment.

Real estate is another investment asset class, that not only shields you assets against inflation, but has good leverage and tax advantages. Buying will ALWAYS be better than renting if payments for both are in the same ballpark.

The disparity in wealth is now more accute because home prices went down, but they went down from unsustainable bubble prices. Net worth of individuals crumbled because they paid for those artificial prices with debt. It's not a reflection of real estate as a historical investment asset class. The wealth issue is more due to the stagnant wages since the 80's.

 

[pigeon]

Look, all I'm suggesting is:

-America overbought on housing. Homeownership rates peaked, price to income ratios peaked, household debt levels peaked. All of this means that we overleveraged in housing. People were spending beyond their means, compared to history.

-Contrary to boomer belief, housing doesn't always go up, and its not a safe investment. I'm pretty sure the only ones to blame for propogating this myth is boomers and realtors.

-Homeownership is not a human right, many people around the world get by renting. Infact, it is supposed to be cheaper than owning a home, contrary to popular belief. Don't forget that with owning a home you have land tax, insurance, maintenance, and the carrying costs of the mortgage.

None of this is wrong, but don't forget that people respond to their culture. If the middle-class American was overleveraged it was because of a culture of debt and a banking structure that convinced them that leveraging was perfectly safe, when they knew it wasn't. If they overinvested in real estate it was in large part because a large organization, in this case the federal government, did its best to motivate them in that direction. Ordinary people have enough trouble trying to get by without being led into bad investments by people who benefit from those investments, especially when those people can turn around and benefit just as much from this investments failing.

 

[ToxicAdam]

The 20th century proved big ideas could be enacted in the real world. They may not be ideas that worked to people's satisfaction but they were implemented and new ones will be in the future. There's no reason why you can't both talk about large scale alternatives, grassroots movements etc. while also spewing the same regurgitated nonsense about obama vs. romney (which I do also btw because it's fun, I'm not saying it doesn't have it's place within a conversation).

It would seem to me that most of the big ideas of the 20th century were enacted or spurred by a complete collapse of the previous schism that preceded it. So, for a systemic economic overhaul to happen would require some kind of similar dramatic collapse. One that would make 2008/1983/1932 look like child's play.

You only need to look at the reaction to the 2008 collapse to see how hard it is to enact any kind of discernable, fundamental change. Everything is a slow(er) process.

 

[Enron]

I think a lot of the back and forth in this thread is also coming from the mentality that renting is throwing your money away, so the paradigm of the conversation is that everyone needs to buy their home in order to at least have some kind of investment. That's simply not true.

Yes. Thank God I didn't buy a home before all of this went south.

Everyone I knew was looking to buy a home in 2005/2006 - and most did. It's true, by renting you have no equity but I didn't want to deal with the hassle of home ownership. Saved by my own laziness! And now I'm in such a better place than I would have been by NOT owning a home.

 

[travisbickle]

http://www.youtube.com/watch?v=Bg98BvqUvCc

Chrono. She's worried about the rising price of gas and mortgage rates, and trusts a president in helping her pay for them ... like every single voter does.

I'm sorry but I have to say that if it was a white gentlemen saying that it would not have been twisted the way it has.

 

[Ponn]

Edit:...And this discussion is about 'what happened to the middleclass wealth?' If your household income is 30K i don't think you constitute as middleclass to begin with. 'Middleclass' by definition should have a little more money than just to get by.

Welcome to the new Middleclass in America, or have you not been paying attention to the news. That is basically what these articles have been hinting and talking about for awhile now. Where do you think that wealth that the 1% has been accumulating is coming from, poverty level? You have an epidemic of auto factories closing, the jobs that do open up in that field through foreign owned plants pay considerably less but what are they going to do. You have jobs either outsourced or if they do decide to keep some stateside they are at a lower rate as well and people will take them because what are you going to do. Even doctors offices and nurses, they pulled the blackmail shit with my sister. The doctors that owned the practice came in and said they were letting everyone go so they could hire new people in at lower rate but if they wanted to re-interview for the new lower rate they could.

 

[TheRagnCajun]

Our generation is now skewed against investing in real estate, but this is one very misguided sentiment.

Real estate is another investment asset class, that not only shields you assets against inflation, but has good leverage and tax advantages. Buying will ALWAYS be better than renting if payments for both are in the same ballpark.

The disparity in wealth is now more accute because home prices went down, but they went down from unsustainable bubble prices. Net worth of individuals crumbled because they paid for those artificial prices with debt. It's not a reflection of real estate as a historical investment asset class. The wealth issue is more due to the stagnant wages since the 80's.

Housing is a pretty shitty asset class. It is illiquid, It carries high upkeep cost, it has high transaction fees, its almost always purcahsed on leverage, and when it crashes it takes a long time to recover. Think of all the old boomers stuck with most of their networth in their house, they need that money to retire. At the same time, there are a lot of young couples who are unable to sell because they're underwater on their mortages. Also, you don't have a lot of control over when you need sell your home. Maybe you get married, divorced, get a new job, etc.

I don't know how you can say buying is always better than renting. I think people only think in terms of 'payments' without thinking of all the peripheral costs associated.

I probably shouldn't use abosolutes, investing in property can be profitable. But the profitable kind is typically not the condos/townhouses/McMansions most people buy for themselves to live in.

 

[JzeroT1437]

The article explains how upward mobility is harder. However, 84% of Americans earn more than their parents

Inflation vs Salary, Percentage of Employed vs Unemployed not taken into account, etc etc.

That statistic is horseshit.

 

[ToxicAdam]

Inflation vs Salary, Percentage of Employed vs Unemployed not taken into account, etc etc.

That statistic is horseshit.

I wouldn't call that statistic "horseshit". It comes from a pretty comprehensive longitudinal survey.

 

[Gray Man]

I wouldn't call that statistic "horseshit". It comes from a pretty comprehensive longitudinal survey.

Interesting, will read.

How do we fix this though? Really.

 

[Jason's Ultimatum]

It is a fact that we consume more non-essentials than every before

We are a consumer-based economy. Businesses won't perform as well if you people stopped buying non-essential items.