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Will you ever get rich?

It used to be an easy question to answer if you were headed to Wall Street.

Not so much today...

Yet another look at America's growing wealth gap doesn't instill confidence.

In fact, if you stop to actually read the article you may wind up looking in the mirror and asking yourself some difficult questions with regards to your goals, aspirations and ambitions.

Proceed... with caution.

Very disturbingly the poorest 90 % of Americans make an average of $31,244 a year. While the richest 1% make a hardly inspiring $1.1 million plus.

Two Very Disturbing Extrapolations

1) $31,244 is a very humble amount of money. It is a very humble amount of money if you are a single person in their 20's living in a studio apartment in a not-so-terrific urban neighborhood. Taking into account this must read Zero Hedge article, (assist to VTech Forever on that one) we can safely say that the majority of today's middle class...really is poor. For an average of ~$30K to apply to 90% of the population (i.e. ~270,000,000 people) there has to be an anchor of dead weight pulling down the honest hardworking sub-six figure crowd subsidizing them.

But who cares...we are the elite,right?

Let us examine...

2) $1.1 million dollars is a nice chunk of change. Let's be clear. A mil definitely does not buy you what it once did. But it's still a nice number...

However...

If the top %1 of Americans (i.e. 3,000,000) make a mil...how discrepant is that figure, really?

Considering how many F50-1000 bosses make a lot more, considering the billionaires and media megastars involved...how many people are actually making that much?

Isn't it highly likely that the "typical Wall Street stiff making $400K/year" is the caboose pulling down this party wagon?

Isn't it actually becoming a reality that in the top 1%, the monkeys and the chimps are the anchor babies making the disgusting discrepancy seem more paletteable in this sort of analysis?

Tell me, monkeys...

What do these figures tell you?

Then think about it and answer honestly...

Will you ever really be rich or will you be paying someone else's free lunch so the real %1 do not have to?

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Comments (353)

  • IlliniProgrammer's picture

    I dunno Midas. My grandparents live on $10K/year combined and are very happy. Grandpa heats his home with firewood he chops in the woods, and a lot of their vegetables are grown in their backyard garden.

    It is a much different lifestyle than most of us urbanites. I don't think money can buy you happiness, but free-time, family, and a sense of your place in world does.

    For a married couple, $63K/year goes a long way outside NYC. In fact, $63K/year in Sheboygan, Wisconsin goes as far as $134K/year in Manhattan:
    http://www.bankrate.com/calculators/savings/moving...

    So I would not feel too bad for our friends in Akron in the bottom 90%. They are probably enjoying better lives than many Manhattanites while working less.

    Will I retire a billionaire? Or even an eight-figure millionaire? Probably not (short of massive inflation). Will I retire happier than most billionaires? You can count on that. :D

  • txjustin's picture

    AWM, for the one millionth time, if you really believe what you say, sign over at least half of your future earnings to social programs to help your fellow countrymen. Maybe it has to do with we don't like being robbed, aka taxed, to subsidize those that are too lazy. There are exceptions to those that need social programs, yes I admit that, but not what we have now.

  • In reply to txjustin
    awm55's picture

    txjustin:
    AWM, for the one millionth time, if you really believe what you say, sign over at least half of your future earnings to social programs to help your fellow countrymen. Maybe it has to do with we don't like being robbed, aka taxed, to subsidize those that are too lazy. There are exceptions to those that need social programs, yes I admit that, but not what we have now.

    What are you talking about? I have taken very hard line positions on welfare reform that protect the tax payer. All you is call people lazy. Fuck you.

  • In reply to GoodBread
    macro's picture

    GoodBread:
    ANT:
    If you have no skill or education and can only make 30k per year, what business do you have bringing a child into this world?

    With that kind of logic, the demographics of our country could get pretty ugly, pretty quick.

    This is why the rich need to have more children, the poor can just PIITB.

  • txjustin's picture

    Haha, I bet you've never had to do anything on your own. Daddy on Wall Street takes care of you. I can just envision you as some skinny pimple faced virgin sitting behind his computer with a shit eating grin on his face right now.

  • In reply to TNA
    IlliniProgrammer's picture

    ANT:
    GoodBread:
    ANT:
    If you have no skill or education and can only make 30k per year, what business do you have bringing a child into this world?

    With that kind of logic, the demographics of our country could get pretty ugly, pretty quick.

    No one will listen, but that is why I no longer care. Condoms are cheap and easy. Bringing a life into this world is a big responsibility. People who cannot afford to raise a kid, yet have them anyway an then cry to me for money get no sympathy.

    Once again, in America, those who plan and save have to finance the losers of society. Not my problem.

    Which is why, IMHO, this country needs to have a one or maybe two child policy when it comes to welfare and social services.

    We will pay welfare and/or EIC for **1** child.

    If you have more, that is your problem. Please consider putting them up for adoption and giving them parents who actually have the skill to raise them. Also please consider your birth control options.

    The problem is that hungry people always generate costs for people who can take care of themselves. We either have to feed them or spend more money maintaining law and order. So I think the only solution here is for people on the public dole to have fewer children.

  • In reply to IlliniProgrammer
    awm55's picture

    IlliniProgrammer:
    ANT:
    GoodBread:
    ANT:
    If you have no skill or education and can only make 30k per year, what business do you have bringing a child into this world?

    With that kind of logic, the demographics of our country could get pretty ugly, pretty quick.

    No one will listen, but that is why I no longer care. Condoms are cheap and easy. Bringing a life into this world is a big responsibility. People who cannot afford to raise a kid, yet have them anyway an then cry to me for money get no sympathy.

    Once again, in America, those who plan and save have to finance the losers of society. Not my problem.

    Which is why, IMHO, this country needs to have a one or maybe two child policy when it comes to welfare and social services.

    We will pay welfare and/or EIC for **1** child.

    If you have more, that is your problem. Please consider putting them up for adoption and giving them parents who actually have the skill to raise them. Also please consider your birth control options.

    The problem is that hungry people always generate costs for people who can take care of themselves. We either have to feed them or spend more money maintaining law and order. So I think the only solution here is for people on the public dole to have fewer children.

    Finally, I totally agree with you.

  • In reply to txjustin
    awm55's picture

    txjustin:
    Haha, I bet you've never had to do anything on your own. Daddy on Wall Street takes care of you. I can just envision you as some skinny pimple faced virgin sitting behind his computer with a shit eating grin on his face right now.

    What is your (practical) solution to the welfare issue?

  • txjustin's picture

    AWM, I'll get back to you on that later tonight.

  • In reply to IlliniProgrammer
    monkeysama's picture

    IlliniProgrammer:
    ANT:
    GoodBread:
    ANT:
    If you have no skill or education and can only make 30k per year, what business do you have bringing a child into this world?

    With that kind of logic, the demographics of our country could get pretty ugly, pretty quick.

    No one will listen, but that is why I no longer care. Condoms are cheap and easy. Bringing a life into this world is a big responsibility. People who cannot afford to raise a kid, yet have them anyway an then cry to me for money get no sympathy.

    Once again, in America, those who plan and save have to finance the losers of society. Not my problem.

    Which is why, IMHO, this country needs to have a one or maybe two child policy when it comes to welfare and social services.

    We will pay welfare and/or EIC for **1** child.

    If you have more, that is your problem. Please consider putting them up for adoption and giving them parents who actually have the skill to raise them. Also please consider your birth control options.

    The problem is that hungry people always generate costs for people who can take care of themselves. We either have to feed them or spend more money maintaining law and order. So I think the only solution here is for people on the public dole to have fewer children.

    Illini I don't think you get it. The College Board is estimating that the cost of a college education will be 400,000 dollars by 2015.

    Think about that for a minute. This says that 90 percent of Americans are making 30k a year. Right now 40 percent have a college degree already. If we're generous and assume that a kid out of college can make 40k a year (on average) he'd have to save 4k, ten percent of his income, for 100 YEARS to pay back that loan, without interest. 100 YEARS! Forget retirement, forget medical care, forget being able to afford kids.

    The American people can no longer afford to be educated enough to live in anything but poverty. Talking about welfare reform only serves to underscore how sadly out of touch you are with the enormity of today's problem.

  • In reply to monkeysama
    happypantsmcgee's picture

    monkeysama:
    The College Board is estimating that the cost of a college education will be 400,000 dollars by 2015.

    That's ridiculously beyond reality for 95% of the schools/people in this country

    If I had asked people what they wanted, they would have said faster horses - Henry Ford

  • In reply to monkeysama
    awm55's picture

    monkeysama:
    IlliniProgrammer:
    ANT:
    GoodBread:
    ANT:
    If you have no skill or education and can only make 30k per year, what business do you have bringing a child into this world?

    With that kind of logic, the demographics of our country could get pretty ugly, pretty quick.

    No one will listen, but that is why I no longer care. Condoms are cheap and easy. Bringing a life into this world is a big responsibility. People who cannot afford to raise a kid, yet have them anyway an then cry to me for money get no sympathy.

    Once again, in America, those who plan and save have to finance the losers of society. Not my problem.

    Which is why, IMHO, this country needs to have a one or maybe two child policy when it comes to welfare and social services.

    We will pay welfare and/or EIC for **1** child.

    If you have more, that is your problem. Please consider putting them up for adoption and giving them parents who actually have the skill to raise them. Also please consider your birth control options.

    The problem is that hungry people always generate costs for people who can take care of themselves. We either have to feed them or spend more money maintaining law and order. So I think the only solution here is for people on the public dole to have fewer children.

    Illini I don't think you get it. The College Board is estimating that the cost of a college education will be 400,000 dollars by 2015.

    Think about that for a minute. This says that 90 percent of Americans are making 30k a year. Right now 40 percent have a college degree already. If we're generous and assume that a kid out of college can make 40k a year (on average) he'd have to save 4k, ten percent of his income, for 100 YEARS to pay back that loan, without interest. 100 YEARS! Forget retirement, forget medical care, forget being able to afford kids.

    The American people can no longer afford to be educated enough to live in anything but poverty. Talking about welfare reform only serves to underscore how sadly out of touch you are with the enormity of today's problem.

    Its 400,000 by 2026.

  • In The Flesh's picture

    We can solve this problem easily. EASILY. With three steps:

    1) Adopt a flat tax. All income levels pays 10%. Taxes average around 40% right now; that would do wonders for everybody's budget. Plus we'd actually have growth.

    2) Remove restrictions on health insurance companies to let them compete nationally. Cost of healthcare would go down.

    3) Start drug testing for welfare. I'm not totally heartless; the help should be available, but if anyone chooses not to take advantage of it, they're on their own. There has to be proof that they're genuinely trying to improve their lot. I don't want to support someone who sits around all day and does nothing; I would be willing to pay to help someone get off the ground. But the Feds don't make that distinction, and it has to stop.

    Metal. Music. Life. www.headofmetal.com

  • monkeysama's picture

    ^ I looked it up and you are correct. My original point still stands - even bringing up welfare reform when we're talking about the income of 90 percent of the population is not even absurd but rather insulting. What we need in this country is wealth reform.

  • In reply to In The Flesh
    monkeysama's picture

    Pfalzer:
    We can solve this problem easily. EASILY. With three steps:

    1) Adopt a flat tax. All income levels pays 10%. Taxes average around 40% right now; that would do wonders for everybody's budget. Plus we'd actually have growth.

    2) Remove restrictions on health insurance companies to let them compete nationally. Cost of healthcare would go down.

    3) Start drug testing for welfare. I'm not totally heartless; the help should be available, but if anyone chooses not to take advantage of it, they're on their own. There has to be proof that they're genuinely trying to improve their lot. I don't want to support someone who sits around all day and does nothing; I would be willing to pay to help someone get off the ground. But the Feds don't make that distinction, and it has to stop.

    1) It's easy to pay 10 percent when you aren't using 100 percent of your income to eat. Bad idea.

    2) I agree completely. We also have to repeal the laws that give health insurers protection from antimonopoly laws and create a public healthcare "pool" that offers no frills healthcare for all citizens.

    3) I say we drug test banking CEOs. I'm not totally heartless; bailout money should be available, but if anyone chooses not to take advantage of it, they're on their own. There has to be proof that they're genuinely trying to improve their lot. I don't want to support someone who sits around all day and bankrupts the country; I would be willing to pay to help someone get their golden parachute. But the Feds don't make that distinction, and it has to stop.

  • In reply to monkeysama
    txjustin's picture

    monkeysama:
    ^ I looked it up and you are correct. My original point still stands - even bringing up welfare reform when we're talking about the income of 90 percent of the population is not even absurd but rather insulting. What we need in this country is wealth reform.

    Wealth reform? Why don't you changer your username to "SocialismRules"?

  • In reply to txjustin
    monkeysama's picture

    txjustin:
    monkeysama:
    ^ I looked it up and you are correct. My original point still stands - even bringing up welfare reform when we're talking about the income of 90 percent of the population is not even absurd but rather insulting. What we need in this country is wealth reform.

    Wealth reform? Why don't you changer your username to "SocialismRules"?

    Welfare reform? Why don't you changer your username to "FascismRules"?

  • GoodBread's picture

    1 child, 2 child policy? Whatever happened to freedom and capitalism? You guys are assuming that every child born to parents who make under 30k will end up being a welfare recipient. No. These guys will be the farmers, construction workers, burger flippers, nurses, school teachers, policemen, firemen, secretaries, and for a lucky few bankers of our future. If we restrict demographic growth now, the US will be forcing a dwindling amount of workers to pay for millions of baby boomers' Medicare and shriveling tax receipts. Good luck pushing IPOs and mergers when your markets are inexorably shrinking (you guys do realize people making under 30k buy Ipods and use Facebook too, right?).

    The American middle class isn't being destroyed by welfare recipients and Obama. It is now on the losing end of global imbalances correcting themselves as wage differentials between developed nations and the BRICs are being compressed and we ever so slowly creep back into being competitive in the industrial field. The people getting hit are the workers taking pay cuts and giving up benefits to keep their jobs. The winners are the top 1% dispensing advice and providing capital for the intervening restructuring process.

  • monkeysama's picture

    I'm seriously considering just making this my sig.

    This is America. People do whatever the fuck they feel like doing, you got a problem with that? Because they have a right to. And because they have guns and no one can fucking stope them. As a result, this country has one of the worst economies in the world. When it gets down to it - talking trade balances here - once we've brain-drained all our technologies to other countries, once things have evened out, they're making cars in Bolivia and microwave ovens in Tadzhikistan and sell them here - once our edge in natural resources has been made irrelevant by giant Hong Kong ships and dirigibles that can ship North Dakota all the way to New Zealand for a nickel - once the Invisible Hand has takn all those historical inequities and smeared them out into a broad global layer of what a Pakistani brickmaker would consider prosperity y'know what? There's only four things we do better than anyone else

    music
    movies
    microcode (software)
    high-speed pizza delivery

  • In reply to monkeysama
    IlliniProgrammer's picture

    monkeysama:

    Illini I don't think you get it. The College Board is estimating that the cost of a college education will be 400,000 dollars by 2015.


    Those are projections based off of historical cost increases. A huge factor was that education became very computerized in the '90s and the last decade. Additionally, states have been providing less funding to schools and private schools have been transferring more money to support underprivileged students.

    Ultimately, the ultimate cost of the kind of four-year education you could have gotten in 1973 is roughly the same today- inflation adjusted. It's just that there's a little more technology today- likely to taper off going forward- and the cost is getting allocated differently.

    The American people can no longer afford to be educated enough to live in anything but poverty. Talking about welfare reform only serves to underscore how sadly out of touch you are with the enormity of today's problem.

    But again, China is probably going to have WWIII with one of its neighbors. So we will probably see reduced competition in the jobs sector- likely during our lifetimes. And while it is tragic, the US gets to see more silver lining than cloud in all of this. We have political stability, we have food, and we have enough energy resources to keep the economy at least limping along until we get onto nuclear.
  • In reply to GoodBread
    IlliniProgrammer's picture

    GoodBread:
    1 child, 2 child policy? Whatever happened to freedom and capitalism? You guys are assuming that every child born to parents who make under 30k will end up being a welfare recipient. No. These guys will be the farmers, construction workers, burger flippers, nurses, school teachers, policemen, firemen, secretaries, and for a lucky few bankers of our future. If we restrict demographic growth now, the US will be forcing a dwindling amount of workers to pay for millions of baby boomers' Medicare and shriveling tax receipts. Good luck pushing IPOs and mergers when your markets are inexorably shrinking (you guys do realize people making under 30k buy Ipods and use Facebook too, right?).

    I specifically said anyone on the public dole. If you are on welfare, we are no longer going to fund 15 children. I do think we can infer that people who rely on the government for help will have trouble training their children to live independently.

    If you earn $7K/year, do not claim welfare, and want to have 15 children, that's great! We just can't afford to *pay* people to have children if the parents are already collecting welfare.

    We can afford the mercy of prohibiting Darwinism for one generation of people who can't support themselves. If your parents can take care of themselves, we can afford to support you. We cannot afford indefinite generations of suspending Darwinism. People who cannot support themselves without government help should not be having more than two children.

  • econ's picture

    Does anybody know exactly how they measure this stuff? Like, some people are wealthy but don't make a very high salary (stock options, for example)? Other people receive bonus as a large chunk of their salary? Are bonuses being included?

  • In reply to Edmundo Braverman
    monkeysama's picture

    Edmundo Braverman:
    This is just a preview of one of the things on tomorrow's Bonus Bananas, but I thought it was germane to the conversation.

    If you live in America, your statistical odds of becoming a millionaire are 1 in 22. That's pretty strong.
    http://motherjones.com/politics/2011/02/income-ine...

    If you ever want to retire you need 2 million in order to afford healthcare and not having to work into your 80s. I consider that terribly low.

  • TNA's picture

    Yawn. People always advocate wealth reform, but never start with themselves first.

    It is jealousy and an inferiority complex. Pretty sad really. Oh well. Thank god people know better and socialism is marginalized at best in this country. The poor can keep dreaming of the government solving their problems while better people take initiative and do it themselves.

    More and more people should stop giving to charity. If they are going to use the goverent to punish and tax me they should only rely on the government. Don't cry to me when you are starving. Cry to the government who you have used to reduce my wealth.

    I work for myself and my family. I will not work hard so another person doesn't have to.

    Socialism fails all the time because it is counter to human nature.

  • IlliniProgrammer's picture

    ^^ If you want to retire at 50.

    In retirement, non-medicare medical expenses are projected to be $250K. In the interest of conservatism, let's double that to $500K.

    Beyond that, you need about 20 times your desired income for an inflation-adjusted lifetime annuity from a AAA rated insurer at 65. So to retire on $40K/year in addition to social security, you need $1.3 million.

    Bear in mind that many retirees also have pensions and other retirement assets that are typically not counted towards "millionaire" status.

    I am not worried about America in the long run. The average 401K balance is at a 10 year high and the average worker is saving 8% of their income per year before company match for retirement. Tack on a 3% employer match, and you're within the 10-15% of income range that you need to save in order to retire at 65.

    In reality, most people will work until 70 and perhaps part-time until 75-80, In reality, the average American has it much better off than they did back in the '50s when the average person at the age of 62 was only expected to make it a few years, rather than 30.

  • In reply to IlliniProgrammer
    monkeysama's picture

    IlliniProgrammer:
    ^^ If you want to retire at 50.

    In retirement, non-medicare medical expenses are projected to be $250K. In the interest of conservatism, let's double that to $500K.

    Beyond that, you need about 20 times your desired income for an inflation-adjusted lifetime annuity from a AAA rated insurer at 65. So to retire on $40K/year in addition to social security, you need $1.3 million.

    Bear in mind that many retirees also have pensions and other retirement assets that are typically not counted towards "millionaire" status.

    I am not worried about America in the long run. The average 401K balance is at a 10 year high and the average worker is saving 8% of their income per year before company match for retirement. Tack on a 3% employer match, and you're within the 10-15% of income range that you need to save in order to retire at 65.

    In reality, most people will work until 70 and perhaps part-time until 75-80, In reality, the average American has it much better off than they did back in the '50s when the average person at the age of 62 was only expected to make it a few years, rather than 30.

    Since when have workers ever saved 8 percent?

  • GoodBread's picture

    Illini, I'm still not comfortable with that kind of social engineering. Doing that would in essence equates to the U.S. having an authoritarian/communist relationship with part of its citizens. Besides, people on welfare are a drop in the bucket when it comes to this country's fiscal problems and implementing such a radical solution is in poor taste when so much could be done to reduce the wealth gap by other means.

  • In reply to monkeysama
    IlliniProgrammer's picture

    monkeysama:
    Since when have workers ever saved 8 percent?

    http://www.bloomberg.com/news/2011-02-23/fidelity-...

    This despite everyone supposedly drawing down their retirement accounts to cover living expenses in a recession, 10 years of a flat market, and a lot of retirements occuring over the past 10 years.

  • In reply to GoodBread
    IlliniProgrammer's picture

    GoodBread:
    Illini, I'm still not comfortable with that kind of social engineering. Doing that would in essence equates to the U.S. having an authoritarian/communist relationship with part of its citizens. Besides, people on welfare are a drop in the bucket when it comes to this country's fiscal problems and implementing such a radical solution is in poor taste when so much could be done to reduce the wealth gap by other means.

    Nobody is being an authoritarian here. If you're on welfare, you can have three kids, but we're only going to pay welfare benefits for two. Please consider putting your third child up for adoption.
  • GoodBread's picture

    Fair enough, although there are much bigger leaks in our economy that I'd like to see taken care of first.

  • onemanwolfpack's picture

    I think a bigger problem is that our society is no longer content with being "middle class". No one "needs" to send their kids to private schooling, drive foreign sports cars, wear a Rolex, etc. I'm sure 50 years ago there weren't millions of people bitching and moaning about making $150,000 a year..

  • In reply to GoodBread
    Level70Mage's picture

    GoodBread:
    Illini, I'm still not comfortable with that kind of social engineering. Doing that would in essence equates to the U.S. having an authoritarian/communist relationship with part of its citizens. Besides, people on welfare are a drop in the bucket when it comes to this country's fiscal problems and implementing such a radical solution is in poor taste when so much could be done to reduce the wealth gap by other means.

    I agree that the cost of welfare itself is a relatively minor blip in the grand scheme of the economy. But what about the loss of a potentially productive part of the population? With the way our current welfare system is set up, a a portion of the population may have greater benefits to having another child than to enter the workforce.

  • In reply to monkeysama
    txjustin's picture

    monkeysama:
    txjustin:
    monkeysama:
    ^ I looked it up and you are correct. My original point still stands - even bringing up welfare reform when we're talking about the income of 90 percent of the population is not even absurd but rather insulting. What we need in this country is wealth reform.

    Wealth reform? Why don't you changer your username to "SocialismRules"?

    Welfare reform? Why don't you changer your username to "FascismRules"?

    I think you should look up the definition of fascism because I'm anything but fascist.

  • TNA's picture

    First off, I am at fucking work, but this topic pisses me off so god damn much, I have to respond.

    1) Do any of you actually look at the data backing this "thesis" up? Whenever I see shit like this, I always want to look at the raw numbers. I suggest you all do also.

    The chart and premise of this article come from this paper, linked to below.
    http://www.people.hbs.edu/mnorton/norton%20ariely%...

    This is the standard definition of wealth, given to all respondents.

    "Wealth, also known as net worth, is defined as the total value of everything someone owns minus any debt that he or she owes. A person's net worth includes his or her bank account savings plus the value of other things such as property, stocks, bonds, art, collections, etc., minus the value of things like loans and mortgages."

    This is the height of the paper. The rest of the paper is about showing people graphs of wealth equality and which people would prefer. They conclude that people prefer Sweden's distribution and that they under estimate the wealth distribution in America.

    WOW, revolutionary. People PREFER an even wealth distribution.

    I PREFER women to want me all the time and never complain. I PREFER making 400K a year and getting my way all the time.

    Last time I checked, the Bill of Rights didn't include jack shit about what people prefer.

    How about asking yourself, why do high earners and more affluent people have wealth? My thoughts are as follow.

    Lower income people or people who are more poor tend to fixate on possession. Material goods. They want to look and feel rich. You see this with all kinds of market research studies and spending patters. They don't buy assets or wealth, they buy goods or name brand shit.

    Look at the recent mortgage crisis. People bought massive homes, maxed out credit cards, cleaned out their home equity. They all felt and looked rich. But in truth they were poor.

    "Anthony, why is someone with a BMW and 40 LCD TV's in a McMansion poor??"

    YOU HAVE DEBT, NOT ASSETS

    Gather round children, story time from Anthony.

    I used to work in a factory, since age 18 to 21. I worked my ASS off. I think I made 8.00 an hour when I started. I also lived at home. You know what I did. I saved, invested and bought assets.

    I put money into I Bonds, CD's, Mutual funds. I was putting 16% into a 401(k), etc. When I did buy things I tended to buy expensive watches (which have actually appreciated!). I had no debt. I bought a car and paid it off in two years.

    "Wow Anthony, how did you do that? How did someone working in a FUCKING FACTORY accumulate WEALTHY, not DEBT"

    BECAUSE I AM NOT A RETARD AND I SAVED MY MONEY INSTEAD OF PISSING IT ALL AWAY

    This chart and graphic would be horrible if the world had FINITE wealth. We DO NOT.

    Rich people hold wealth because they save, invest, buy houses, land, business, art, etc. They buy other things, yes, but they usually do not go into bone crushing debt to have these things.

    This is why immigrants are so successful. They buy assets, not crap. This is why Indian people and Chinese people are so successful. They don't buy Air Jordans, they buy fucking newsstands.

    ------------------------------------

    Let me switch gears. Suppose we taxed the wealthy in an attempt to redistribute the "wealth". Unless you teach lower income people to save, they will simply take this money and buy more shit with it. Wealth is not transferred or redistributed. Wealth is taken from the rich and cash is given to the poor. Wealth is only created when debt is reduced and assets grow.

    You could take all the savings from the rich and give it to the poor and the poor would still not have wealth because they would spend all of their money.

    ---------------------------------

    If you want to redistribute wealth to poor people, you MUST FOLLOW THESE STEPS

    1) Take from the Rich

    2) Government gets money

    3) Government buys bonds

    4) Government gives bonds to poor people and does not allow them to sell them

    5) Government takes poor people and pays all of their debt

    6) Government does not allow poor people to spend more than they make

    There you go. Debt will be zero. Budget will be balanced and they will have assets (the bonds) which will give them wealth. That is the only way.

    OR YOU COULD JUST LET PEOPLE BE MOTHER FUCKING FREE AND LET MONEY GET SPENT ON WHAT PEOPLE VALUE. RICH WILL SAVE, POOR WILL BY NIKES AND WE WILL LIVE IN A FREE GOD DAMN COUNTRY!!!!!!!!!!

  • txjustin's picture
  • TNA's picture

    Fucking someone tell me I am wrong? We magically think that people will start saving. This country had a god damn negative savings rate forever.

    Wealth is simply Assets>Debts

  • IlliniProgrammer's picture

    But here's the thing Ant. We live in a democracy, and if we have this system, we have a small group of people who keep getting richer and we have lots of poor voters and class envy. This never ends well for rich people. You may be 100% right from an idealistic standpoint, but from a pragmatic standpoint, we should consider ways that we can avoid having the government encourage welfare recipients to have extra children.

  • happypantsmcgee's picture

    I would like to be the first to make a market on Anthony having a heart attack. The over/under is 35. The under is 3:1 and the over is 3:2. PM me for paypal info.

    If I had asked people what they wanted, they would have said faster horses - Henry Ford

  • In reply to IlliniProgrammer
    monkeysama's picture

    IlliniProgrammer:
    monkeysama:
    Since when have workers ever saved 8 percent?

    http://www.bloomberg.com/news/2011-02-23/fidelity-...

    This despite everyone supposedly drawing down their retirement accounts to cover living expenses in a recession, 10 years of a flat market, and a lot of retirements occuring over the past 10 years.

    Um.....yeah. That's account BALANCES. Over the same time period the stock market gained something like 30 percent. So you're saying that investments increased by 10? That means we have people investing in VERY conservative portfolios or 401ks decreased because of all the babyboomers. It says nothing about the savings rate.

    Here's the BEAs take: http://www.bea.gov/national/nipaweb/TableView.asp?...

    So the savings rate has historically been between 3-5 percent for the last twenty years and recently it's six percent. So let's be generous and say he saves every last penny after expenses. Sure why not! Our boy is going to college and he learned his lesson from the crash of 2008! And we want to retire with 1.3 mil, I think that's what you said. Let's start making that money when they're 24 (after college) and assume they have 25k in student loans (that's the national average) with an interest rate of 6.8 percent (the average for Stafford loans). We'll also assume he's going to pay it back as soon as he can so he doesn't get killed by the interest. He's smart, he went to college for a reason and he'll be damned if he's going to let compound interest bite him in the ass!

    To make this simple we'll assume the rate of this guy's raises are about the same (3 percent), which is in line with how much we're going to make his food and rent rise (3 percent, we'll call that inflation). Over the last thirty years income has remained flat with inflation so I don't think this is an unreasonable assumption. We're also talking about what 90 percent of American's make, so we're probably being crazy saying he'll come out of college making 31k (after all 40 percent of Americans have college degrees). We'll be generous and say that the interest the guy earns on savings is ten percent what with the growth in China and all (even though most Americans don't really dabble in the stock market and the China phenomenon we'll doubtfully last his entire employed life).

    We'll make food and rent 15k a year. Round numbers, if he spends ten dollars on food a day that leaves 11350 for rent which is 945 a month. That's a little high but I guess we can just say that the difference is what he would pay on clothes and other incidental expenses. So about reasonable. Food/Rent/Incidentals rise in price at 3 percent a year.

    Taxes are ten percent a year flat tax. Complete craziness, but we'll just assume it as someone else in this thread thought that might be a good national policy. That tax also applies to capital gains from savings too remember.

    Here's the numbers:
    Age Income (Thousands) Food/Rent Loans Taxes on Income I-F/R-T Savings Taxes on Cap Gains Final Savings
    22 31 15 25 3.1 12.9 0 0 0
    23 31.93 15.45 13.8 3.19 13.29 0 0 0
    24 32.89 15.91 1.45 3.29 13.69 0 0 0
    25 33.87 16.39 0 3.39 14.1 14.1 0 14.1
    26 34.89 16.88 0 3.49 14.52 15.51 0.14 15.36
    27 35.94 17.39 0 3.59 14.95 17.06 0.16 16.9
    28 37.02 17.91 0 3.7 15.4 18.76 0.17 18.59
    29 38.13 18.45 0 3.81 15.87 20.64 0.19 20.45
    30 39.27 19 0 3.93 16.34 22.7 0.21 22.5
    31 40.45 19.57 0 4.04 16.83 24.97 0.23 24.75
    32 41.66 20.16 0 4.17 17.34 27.47 0.25 27.22
    33 42.91 20.76 0 4.29 17.86 30.22 0.27 29.94
    34 44.2 21.39 0 4.42 18.39 33.24 0.3 32.94
    35 45.52 22.03 0 4.55 18.94 36.56 0.33 36.23
    36 46.89 22.69 0 4.69 19.51 40.22 0.37 39.85
    37 48.3 23.37 0 4.83 20.1 44.24 0.4 43.84
    38 49.75 24.07 0 4.97 20.7 48.66 0.44 48.22
    39 51.24 24.79 0 5.12 21.32 53.53 0.49 53.04
    40 52.78 25.54 0 5.28 21.96 58.88 0.54 58.35
    41 54.36 26.3 0 5.44 22.62 64.77 0.59 64.18
    42 55.99 27.09 0 5.6 23.3 71.25 0.65 70.6
    43 57.67 27.9 0 5.77 24 78.37 0.71 77.66
    44 59.4 28.74 0 5.94 24.72 86.21 0.78 85.43
    45 61.18 29.6 0 6.12 25.46 94.83 0.86 93.97
    46 63.02 30.49 0 6.3 26.22 104.32 0.95 103.37
    47 64.91 31.41 0 6.49 27.01 114.75 1.04 113.7
    48 66.85 32.35 0 6.69 27.82 126.22 1.15 125.07
    49 68.86 33.32 0 6.89 28.65 138.84 1.26 137.58
    50 70.93 34.32 0 7.09 29.51 152.73 1.39 151.34
    51 73.05 35.35 0 7.31 30.4 168 1.53 166.47
    52 75.25 36.41 0 7.52 31.31 184.8 1.68 183.12
    53 77.5 37.5 0 7.75 32.25 203.28 1.85 201.43
    54 79.83 38.63 0 7.98 33.22 223.61 2.03 221.58
    55 82.22 39.79 0 8.22 34.22 245.97 2.24 243.73
    56 84.69 40.98 0 8.47 35.24 270.57 2.46 268.11
    57 87.23 42.21 0 8.72 36.3 297.62 2.71 294.92
    58 89.85 43.47 0 8.98 37.39 327.39 2.98 324.41
    59 92.54 44.78 0 9.25 38.51 360.12 3.27 356.85
    60 95.32 46.12 0 9.53 39.66 396.14 3.6 392.54
    61 98.18 47.51 0 9.82 40.85 435.75 3.96 431.79
    62 101.12 48.93 0 10.11 42.08 479.33 4.36 474.97
    63 104.16 50.4 0 10.42 43.34 527.26 4.79 522.47
    64 107.28 51.91 0 10.73 44.64 579.98 5.27 574.71
    65 110.5 53.47 0 11.05 45.98 637.98 5.8 632.18
    66 113.82 55.07 0 11.38 47.36 701.78 6.38 695.4
    67 117.23 56.72 0 11.72 48.78 771.96 7.02 764.94
    68 120.75 58.43 0 12.07 50.25 849.15 7.72 841.44
    69 124.37 60.18 0 12.44 51.75 934.07 8.49 925.58
    70 128.1 61.98 0 12.81 53.31 1027.48 9.34 1018.14
    71 131.94 63.84 0 13.19 54.91 1130.22 10.27 1119.95
    72 135.9 65.76 0 13.59 56.55 1243.25 11.3 1231.95
    73 139.98 67.73 0 14 58.25 1367.57 12.43 1355.14

    That's a little hard to read, but if you want you can throw it into excel and delimit it.

    2010 US life expectancy for a dude is 75. He makes his nut at 73, so he's got 2 years to enjoy it before he buys it.
    Which I feel is fair assumption given that we're talking averages. Oh, and he's not allowed to marry, get sick, have kids, or otherwise splurge or be stupid in any way with his money.

    Jesus Christ guys. Your solution to this problem is welfare reform? Are you out of your fucking minds?

  • In reply to IlliniProgrammer
    TNA's picture

    Illini,

    I am a strong proponent of population control and decline. But what can we do? Being pragmatic, anything that is anti human gets a horrible rap. No way a bill restricting cash pay outs to people on welfare based on the number of kids would pass.

    Atlas Shrugged man. I realize it must suck and look unfair, but you are doing wrong by taking from people who have earned it.

    I don't know. Ill let this topic develop more and think over things. I need to crank out some work, but I will be back.

    No more socialism. Lets discuss how we can get poor people to accumulate assets and not debt. This will involve more than simply tax and redistribute methods.

  • txjustin's picture

    Monkeysama, what do you suggest specifically? I'm genuinely curious.

  • happypantsmcgee's picture

    Monkeysama, it is hilarious to me that you have turned your way of thinking around so much in the past few months.

    If I had asked people what they wanted, they would have said faster horses - Henry Ford

  • In reply to monkeysama
    IlliniProgrammer's picture

    monkeysama:

    Um.....yeah. That's account BALANCES. Over the same time period the stock market gained something like 30 percent. So you're saying that investments increased by 10? That means we have people investing in VERY conservative portfolios or 401ks decreased because of all the babyboomers. It says nothing about the savings rate.

    No. I'm saying that you have one picture today and one picture from 10 years ago with roughly the same demographics- with some people being born, some dying, some coming into the workforce, and some retiring.

    Ten years ago, we had come off of a 300% gain in the markets over the prior ten years.

    Ten years ago, we had a strong economy with 4% unemployment.

    For all of the complaining everyone does, would it surprise you to know that the typical worker today has managed to save *MORE* in his/her 401K than the typical worker of 10 years ago (who is roughly the same age and has been saving for just as long)?

    Truth is that people have done a much better job of saving for retirement over the past 10 years than 10-20 years ago.

    Here's the BEAs take: http://www.bea.gov/national/nipaweb/TableView.asp?...

    So the savings rate has historically been between 3-5 percent for the last twenty years and recently it's six percent. So let's be generous and say 5 percent. And we want to retire with 1.3 mil, I think that's what you said. Let's start making that money when they're 24 (after college) and assume they have 25k in student loans (that's the national average) with an interest rate of 6.8 percent (the average for Stafford loans). We'll also assume he's going to pay it back as soon as he can so he doesn't get killed by the interest. He's smart, he went to college for a reason and he'll be damned if he's going to let compound interest bite him in the ass.


    This is non-retirement savings, for the record and excludes 401k contributions and pensions.

    2010 US life expectancy for a dude is 75. He makes his nut at 73, so he's got 2 years to enjoy it before he buys it.
    Which I feel is fair assumption given that we're talking averages. Oh, and he's not allowed to marry, get sick, have kids, or otherwise splurge or be stupid in any way with his money.

    Well, yes, that's life. Life was never designed for 30 years of retirement, and if you're planning on dying at 75, you can probably retire earlier. Also, if you are living on $31K/year, you need to save only $600K for an inflation adjusted lifetime annuity at 65- assuming $0 in Social Security, which BTW, I think is a good program that can continue in its current form if we raise the retirement age. This is a much better situation than people working until they died like the past 5000 years of civilization.

    Regardless, the worker can retire at 65 on his savings alone- and any Soc. Sec he'd be able to get on top of that would be a bonus. He has 20x his earnings and can stick it all into a lifetime inflation-adjusted annuity. And if inflation-adjusted rates are high like back in the late '90s, he can probably even retire at 61-62.

    Jesus Christ guys. You're solution to this problem is welfare reform? Are you out of your fucking minds?

    Well, yes. Fewer families of 15 kids->fewer workers-> less competition-> higher wages for this guy.
  • TNA's picture

    Rage man, fucking rage.

    I honestly want to help the poor, but I think the Left uses them as a weapon. Really upsets me.

    Look at us guys. I literally want to kick the shit out of a poor person because of this topic. They probably don't even care. It is Democrats and Liberals who are pushing this garbage.

    How many genuinely poor kids are on here advocating this shit. You always here rich or well off people pushing this redistribution bullshit.

    Democrats want slaves and poor people are the closest thing to it. The use the carrot of free money then rich as their enemy.

    In reality, the rich employ them, buy goods and services and help them.

  • In reply to txjustin
    monkeysama's picture

    txjustin:
    Monkeysama, what do you suggest specifically? I'm genuinely curious.

    The first thing we need to do is change the rhetoric in this country. Anyone who can count without having to use their fingers knows that something is terribly, terribly wrong.

    Second, we need tax reform. We need a tax based on wealth, not income. This would encourage spending while also apportioning the amount of tax to those who could best afford it. It also wouldn't distinguish between capital gains tax (interest earned income) and working income. The tax would be apportioned based upon the Gini coefficient - the more unequal society became the more the wealthy would need to pay. Tax brackets would go all the way to the top and be as smooth as possible. None of this top tax bracket at 250k bullshit.

    Third we need budgetary reform. Congress sets a budget at the beginning of every year, a week before tax day, and everyone has to pay according to their current wealth. If deficit spending is needed or unavoidable the Federal Reserve would make an announcement and emergency spending would be used to cover the shortfall. If the deficit isn't balanced by the time of the next year's budget every congressmen is recalled and general elections are in place for election to office the following month. None of the current sitting congressmen are ever allowed to hold public office again.

    Fourth we need corruption reform. Every federally elected public official gets the median wage of a citizen of the country, for so long as they are in public office. They are not allowed to accept money from any outside source after they have been in office and they are not allowed to accept any money from outside sources for 2 years before being elected. Sound harsh? It is. No one will ever run for office again you say? I doubt it. We have too many people who want to milk the tit of the public trust at the expense of the general welfare as it is. We can find 435 power hungry publicity hounds by throwing a rock in times square.

    Let's do those things for starters.

  • TNA's picture
  • In reply to monkeysama
    IlliniProgrammer's picture

    monkeysama:
    txjustin:
    Monkeysama, what do you suggest specifically? I'm genuinely curious.

    The first thing we need to do is change the rhetoric in this country. Anyone who can count without having to use their fingers knows that something is terribly, terribly wrong.

    Second, we need tax reform. We need a tax based on wealth, not income. This would encourage spending while also apportioning the amount of tax to those who could best afford it. It also wouldn't distinguish between capital gains tax (interest earned income) and working income. The tax would be apportioned based upon the Gini coefficient - the more unequal society became the more the wealthy would need to pay. Tax brackets would go all the way to the top and be as smooth as possible. None of this top tax bracket at 250k bullshit.

    Third we need budgetary reform. Congress sets a budget at the beginning of every year, a week before tax day, and everyone has to pay according to their current wealth. If deficit spending is needed or unavoidable the Federal Reserve would make an announcement and emergency spending would be used to cover the shortfall. If the deficit isn't balanced by the time of the next year's budget every congressmen is recalled and general elections are in place for election to office the following month. None of the current sitting congressmen are ever allowed to hold public office again.

    Fourth we need corruption reform. Every federally elected public official gets the median wage of a citizen of the country, for so long as they are in public office. They are not allowed to accept money from any outside source after they have been in office and they are not allowed to accept any money from outside sources for 2 years before being elected. Sound harsh? It is. No one will ever run for office again you say? I doubt it. We have too many people who want to milk the tit of the public trust at the expense of the general welfare as it is. We can find 435 power hungry publicity hounds by throwing a rock in times square.

    Let's do those things for starters.


    So what happens when all of the rich people move to the Bahamas or the Cayman Islands or Brazil and take most of their wealth with them?

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