Who's making money these days?

[Daytonaflyer]

The occupiers are occupying the wrong street.

I fear we are going to have to go over the cliff before mainstream gets the message that the government CANNOT save you.

The government has caused all of these problems...it is well established by real economist....note...real economist do not appear on FOX/CNN or write columns for the New York Times.

Why is the middle class failing and the rich geting richer....that's very simple...the rich have majority of their wealth in performing Assets...the middle class and below have all/most of their assets in cash, depreciating Assets, or government subsidized Assets. If the value of cash is depreciating over time then someone with 100% or nearly 100% of their wealth in cash is going to get poorer. If cash/near cash is only 10% of your wealth and the value of performing assets (Subway sanchwich shops, factories, retail stores, etc.) keeps up with inflation (as assets generally do) then you will get richer relative to the middle class.

Additionally, the middle class americans have most of their assets in depreciating things (cars-probably on credit to...35,000 for an asset worth 30,000 that goes down by double digit percentages a year) and homes that were purchased at too high prices because of government subsidies...so for a middle class american the value of their cars are falling, the value of their homes are being artificially propped up by the federal government that is less and less able to afford to keep the music going, and the rest (the cash) is being diminished by the federal government because they keep printing more and more money.

Why? There is no mystery and it has nothing to do with Wall Street.

Seriously? So you're saying that the pay cut and the work rule changes that will reduce my pay by $50,000 this year are because I don't have all my money in appreciating assets?
Because I'm pretty certain it has very little to do with that and if our management would stop trying to cut our pay, benefits, and retirement at every turn, I'd probably have a lot more money to invest in those so-called "appreciating assets".
The wealthy business CEO's are the problem, the Republican party has enabled them for decades, and that's the real problem.

 

[N311HK]

Just another example:
http://www.thepostgame.com/commentary/201112/hruby-tuesday-miami-marlins-occupy-mlb


The richest people are those without morals

 

[xray678]

Really....your just sending out flamebait, right? Did you read the whole post? The size of the moderate house would depend upon the family size, wouldn't it?

I would disagre with you. I don't care if you have 1 kid or 6 kids, a moderate house depends on your income, not your family size.

Good luck getting a bigger house because you have a bigger family. If you can only afford a 3 bedroom house, your kids better have bunk beds.

 

[Junkflyer]

So NuGuy you'd like the stock market to collapse and put everyone out of work so the rich guys have to sell coffee? All the people with 401k's would lose their retirement and unemployment would spike into the double digits to teach a few guys a lesson. Tax revenue would drop and make even less people pay for running the country. Seems to be a little short sighted.

 

[dragontamer]

Get real. That's such a cop-out.

There is a propaganda machine out there that wants you to be pessimistic about the govt -
Because in a government, of the people, for the people, by the people- Government IS our power-

Unless we can be convinced not to use it.

Wave, my brother. I am real. Propaganda machine? No. Just have my eyes open, that's all. Do you really think Government is not too big, too wasteful? It is sucking the spirit and $$ out of this country by over regulation and spending on a bureaucracy that is out of control. It has promissed much more than it can deliver. Americans need to look to themselves, their families and their own immediate communities/church rather than the STATE. http://www.washingtonpost.com/blogs...es-in-america/2011/09/23/gIQABPl50K_blog.html

Read Atlas Shrugged -- Great book.

 

[pilotyip]

But there is still a ton of opportunity in this country. I have been an engineer for awhile. Made a good living at it and added to it by investing in big oil. That allowed me to fly for fun and get an ATP.

So the United States is still the land of opportunity for poor people. It is still a country of meritocracy vs. aristocracy.

I used to fly at a 135 company. The guy who owned it was a major airline captain. So he has made a fortune in that business instead of just crying about how bad the airline has treated him.

Check Six

Well said, the people in this country are so fortunate that there is opportunity out there that is waiting for someone to come and do it. That is why almost everyone in the world wants to come to this country.
However I fear big gov’t may destroy this and we will become a copy of the European Welfare state, but in that case when everyone is poor we will income equality.

So NuGuy you'd like the stock market to collapse and put everyone out of work so the rich guys have to sell coffee? All the people with 401k's would lose their retirement and unemployment would spike into the double digits to teach a few guys a lesson. Tax revenue would drop and make even less people pay for running the country. Seems to be a little short sighted.

Hey stop that this is FI, we do not deal in reality. It seems pilots are attempting to distort reality to fit something that can not exist, like liquid water with an atmospheric pressure of zero.

 

[GogglesPisano]

There's anecdote, and then there's fact.



Upper bound
The American dream is simple: work hard and move up. As the country emerges from recession, the reality looks ever more complicated
Apr 15th 2010 | CHICAGO | from the print edition


AMERICANS are an optimistic lot. If there is one thing they believe in above all, it is the ability to move ahead. In poll after poll, a majority reject the notion that success is determined by forces beyond their control. In early 2009, hardly a sunny period, 71% still agreed that hard work and personal skill are the main ingredients for success. A high degree of social mobility has always defined American culture, from the work of Alexis de Tocqueville and Horatio Alger to the remarkable story of Barack Obama himself.

But the reality for most Americans is becoming more complicated. The recession came at the end of a period marked by record levels of inequality. Many Americans, lacking true upward mobility, bought its trappings, such as a bigger house or better car. Disaster duly followed. As a result, American optimism has been pierced by doubt. In a new poll for The Economist by YouGov, 36% of respondents said they had less opportunity than their parents did, compared with 39% who thought they had more. Half thought the next generation would have a lower standard of living, double the share that thought living standards would rise. As the country recovers, two problems cloud its future. Rates of social mobility are unlikely to grow. Inequality, however, may widen even further.

These trends have been building up for years. In 1963 John Kennedy declared that a rising tide lifts all boats. Indeed, in 1963 this was true. Between 1947 and 1973, the typical American family’s income roughly doubled in real terms. Between 1973 and 2007, however, it grew by only 22%—and this thanks to the rise of two-worker households. In 2004 men in their 30s earned 12% less in real terms than their fathers did at a similar age, according to Pew’s Economic Mobility Project. This has been blamed on everything from immigration to trade to declining rates of unionisation. But the driving factor, most economists agree, has been technological change and the consequent lowering of demand for middle-skilled workers.


The most highly skilled, meanwhile, have stuffed their pockets happily. Between 1970 and 2008 the Gini coefficient, a measure of income inequality, grew from 0.39 to 0.47. In mid-2008 the typical family’s income was lower than it had been in 2000. The richest 10% earned nearly half of all income, surpassing even their share in 1928, the year before the Great Crash.

Compared with people in other rich countries, Americans tend to accept relatively high levels of income inequality because they believe they may move up over time. The evidence is that America does offer opportunity; but not nearly as much as its citizens believe.


Parental income is a better predictor of a child’s future in America than in much of Europe, implying that social mobility is less powerful. Different groups of Americans have different levels of opportunity. Those born to the middle class have about an equal chance of moving up or down the income ladder, according to the Economic Mobility Project. But those born to black middle-class families are much more likely than their white counterparts to fall in rank. The children of the rich and poor, meanwhile, are less mobile than the middle class’s. More than 40% of those Americans born in the bottom quintile remain stuck there as adults.

Family background is not insurmountable, explain Isabel Sawhill and Ron Haskins of the Brookings Institution. In particular, earning a degree and marrying before having children can help someone climb to a higher rung. However, family background influences the likelihood of education and marriage (see article).

How rising inequality affects social mobility is still unclear. Those born since inequality started to rise sharply are only just now becoming adults. However there are some troubling signs according to two papers to be presented at the Tobin Project, an alliance of scholars, this month. Christopher Jencks of Harvard University finds that income inequality has been accompanied by a widening gap in college attendance. Ms Sawhill argues that a rising correlation between income levels, likelihood of marriage and level of education will make society more stagnant.

The recession, meanwhile, may have exacerbated trends in inequality. The capital markets, points out Timothy Smeeding of the University of Wisconsin, have recovered more quickly than the housing or labour markets. This is troubling for the poor and the middle class, since homes represent a greater share of their wealth. Unemployment has been concentrated in America’s lower ranks. As the rich recover, poor and middle-class people may lag behind. Young workers may fare badly, too. Those who graduate in recessions have lower incomes in the long term, according to Lisa Kahn of Yale University.

What can government do to help? Few politicians dare favour too much income redistribution. During his campaign Mr Obama told an Ohio voter that he wanted to “spread the wealth”; outrage duly followed. Conservatives now argue, however, that Mr Obama has carried this creed into office. The health bill expands care for the poor by taxing the rich, and George Bush’s tax cuts for the rich are due to expire at the end of the year, while Mr Obama has extended those for people of lesser means.

Policies that help equalise opportunity are more popular, and it is here that Mr Obama may have the greater impact. In February his “middle-class task-force” touted measures such as expanded child care and, less encouragingly, support for unionisation. Most promising is his plan to overhaul education. This includes raising standards and expanding the role of charter schools and merit pay for teachers. Last month Mr Obama succeeded in passing reforms for college loans, part of a bid to raise stagnant graduation rates.

Paying for such investments will be difficult, however. Democrats wanted the student-loan bill to include provisions for early education and community colleges. In the end, spending for community colleges was lowered from $10 billion to $2 billion. The allocation for early education was scrapped entirely.

Ms Sawhill and Mr Haskins argue for a drastic shift in federal priorities: rather than pay for the consumption of the old, America should invest in the productivity of the young. Reducing entitlement programmes will be tricky, to say the least. But stagnant rates of mobility risk turning the American dream to delusion.

 

[pilotyip]

Last month Mr Obama succeeded in passing reforms for college loans, part of a bid to raise stagnant graduation rates.

Paying for such investments will be difficult, however. Democrats wanted the student-loan bill to include provisions for early education and community colleges. In the end, spending for community colleges was lowered from $10 billion to $2 billion. The allocation for early education was scrapped entirely.

This is part of the problem; our focus on this all encompassing college education. It has been posted that I am anti-college degree. Nothing could is further from the truth. The country needs all the college-educated citizens it can have, its raises the level of knowledge to keep this as the greatest country in the world. Real degrees in business, engineering, the sciences, math, and medicine provide a graduate with marketable skills.

We are training less engineers than we did in the 60's, even thought college enrollment is up 400%, however have had 1000% increase in communications majors. Students go to college by the 1000’s but graduate with no marketable skills.

We have become an elitist society, where your worth as a human is based upon the college degree. Teachers most who have never done anything except be in a school, look at college as the ultimate goal, politicians who want votes talk about every child most go to college, even BO gets on TV and says we must prepare every child for college. If you are not interested in college, the teachers shuffle you off to the side to Voc-Tect. The losers class for those who are not college material.

Many parents consider themselves failures if their child does not go to college. Yet there are many great paying, career jobs out there particularly in the skilled trades that go unfilled because we do not encourage our school children to pursue these careers.

My brother-in law, two year vo-tech auto mechanic degree, owns a Muffler Shop, (non-college graduate) he makes over $200K per year.

Quick story a few years back I am traveling in the back, sitting next to a guy, he finds out I am a Navy guy. He laments that is daughter Valedictorian of her class, elected not to go to college, but to join the Navy and become a Nuclear Power Plant Operator. He was disappointed because she was not going to college. I explained she had gotten into an elite program, where at the end her of her 6 years, the Navy paid pay her $100,000 to sign up another four years. Because there were so many high paying jobs out there for people with her skills and knowledge. That she would have the GI Bill to go to college for free. He felt much better about his daughter’s choice after we talked.

 

[igneousy2]

Seriously? So you're saying that the pay cut and the work rule changes that will reduce my pay by $50,000 this year are because I don't have all my money in appreciating assets?
Because I'm pretty certain it has very little to do with that and if our management would stop trying to cut our pay, benefits, and retirement at every turn, I'd probably have a lot more money to invest in those so-called "appreciating assets".
The wealthy business CEO's are the problem, the Republican party has enabled them for decades, and that's the real problem.

Nope that's not why...nor are the occupiers occupying because of your pay cuts either. My response was to the statement why the rich get richer and the poor get poorer...a macro economics question.

Well the good news for you is that at least with the debasement of the dollar over the years your pay cut is only the equivilant of a really nice car a year...imagine...30 years ago $50,000 would have been a whole house every year and would have been considered serious money.

 

[pilotyip]

Well the good news for you is that at least with the debasement of the dollar over the years your pay cut is only the equivilant of a really nice car a year...imagine...30 years ago $50,000 would have been a whole house every year and would have been considered serious money.

When you look at inflation ajusted household income over the last 50 years the average US citizen makes more now days

Check it out

http://www.davemanuel.com/median-household-income.php

How about we measure purchases in minutes worked?

By that measure, the work-time cost of new homes fell from 7.8 hours in 1920 to 6.5 hours in 1956 and 5 hours in 1970, but then rose to 5.6 hours in 1996. (See Exhibit 4: Gimme Shelter.)

Drivers may grumble when they pull into a service station, but a gallon of gasoline required just 5.4 minutes of work in 1997, compared with 6.6 minutes in 1970, three years before the Arab oil embargo caused prices to surge. If we consider the 60 percent increase in average miles per gallon since 1970, the work time to drive a typical car 100 miles has been nearly halved over the past quarter century—from 49 minutes in 1970 to 28 minutes today. The price of an automobile tire has risen from $13 in the mid-1930s to about $75 today. However, today's steel-belted radials last more than 42,000 miles, a big increase from the 16,000 miles for the nylon tires of the 1950s or the 2,000 miles for the 31/2-inch, cotton-lined tires of the early 1920s. Based on work time per 1,000 miles, tires are now cheaper than ever.

Check it out

http://dallasfed.org/fed/annual/1999p/ar97.cfm