5 Myths About the Poor Middle Class
POSTED BY: Geezer
UPDATED: Friday, January 4, 2008 20:04
VIEWED: 6018
PAGE 5 of 10
Hey, like I told Rap... you wanna discuss, we'll discuss... you wanna play mindgames, or just spout off, don't be surprised at the return fire, ehe ?
I gave all the input my knowledge of economics allows on the situation, truthfully it's outta my league, but dude, I can smell BS a mile away and when folks are telling me something rather blatantly at odds with what my own eyes tell me...
Imma call em on it, yanno.
The dude who wrote the piece we're discussin did a piss poor job of making his argument, even *I* can see that, so it was a really bad job of it, I've no position on the argument itself other than taxes and expenses have far outstretched any economic benefits we've seen up here in Detroit, that's for damn sure.
I may snark and mock, but I *WILL* discuss, if discussion is possible and it's likely to accomplish anything - I am sayin do something to prove your point beyond the apalling rubbish that's been offered so far, and do it in a fashion that makes SENSE to someone without a college degree.
Dealer takes one and stands pat, your bet.
Raise/Fold/Call ?
-F
Addendum, Oh come now Finn, I make no secret of not being a very nice person, and none whatever of my agendas, in fact, if I don't think they're getting across, I will go back and clarify!
So it's not like the inherent dishonesty of hiding blind hate behind a mask of reason and logic, like some do.
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Originally posted by 6ixStringJack:
So I guess Finn and Geezer are just going to ignore my post then?
Nope. Just limited free time right now.
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1. Inflation plus the fact that penalties, such as the alternative minimum tax are not adjusted for inflation...largely, if not altogether, dismiss this entire point.
Inflation hits everyone, and the upper limit of "middle-class" (whatever that limit is) moves up as steadily as the lower limit. Incomes which used to be in the 'upper' class now fit firmly in middleclass. Also, after years of dodging the issue, the AMT is now being addressed by Congress. I'd expect indexing to be in place permanently by the end of next year.
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2. This point is nullified for the reasons that I've stated above. Because of inflation, any family with under $50,000/yr today is basically poor (particularly because of the unaffordability of housing today), and by as soon as 2010 nearly 16 million more homes will be impacted by the alternative minimum tax as our incomes increase (at a rate slower than TRUE inflation, of course).
I provide the same response as above. AMT will be indexed. Congress passed a one year reduction this year, and will get indexing in place soon.
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3. I can't disagree with the fact that the debt average has been manipulated any more than a lot of your figures have been manipulated....Fortunately for me, I lost everything 7 years ago and really learned what it meant to have a good job and to use that time wisely to prepare for a dark future.
I seem to see a trend in this thread. The folk who have lost a job, or don't make as much as they'd like, or have had other financial trouble, think that the economy is tanking and the middle class shrinking. Folk who have never been out of work, made good money, and always had enough think things are going OK. only natural, I suppose.
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5. Well thank you very much Mr. Corpo. I'll need that insurance because I've had to go smoke outside in 2 degree winds tonight.
Your choice. And Mr. Corpo does provide health insurance for you, regardless of your behavior, doesn't he?
"Keep the Shiny side up"
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Quote:Except me and my SO. We're doing OK financially. We both have good, stable, well-paying jobs (which are near-to-impossible to come by nowadays). My investment in gold and currency baskets has paid off nicely, and I'm looking for the next big wave to ride. (Hint: It isn't real estate. BTW, when comparing investment strategy success, the macroeconomic approach actually works best.) But even WE think the economy is tanking, because we don't confuse our personal situation with overall reality.
seem to see a trend in this thread. The folk who have lost a job, or don't make as much as they'd like, or have had other financial trouble, think that the economy is tanking and the middle class shrinking. Folk who have never been out of work, made good money, and always had enough think things are going OK. only natural, I suppose.
I found an interesting macroeconomic website called the RGE Monitor. Unfortunately it's so pricey that only institutions like banks, universities and investment houses would want to subscribe. And like all websites, you have to take their information with a grain of salt. But you can access the founder's blog for free, and this is what he said as of Dec 25, in brief
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In recent weeks, the global liquidity and credit crunch that started last August has become more severe. This is easy to show: in the United States, the euro zone, and the United Kingdom, spreads between Libor interest rates (at which banks lend to each other) and central bank interest rates – as well as government bonds – are extremely high and have grown since the crisis began. This signals risk aversion and mistrust of counterparties. ... The recent announcement of coordinated liquidity injections by the Fed and four other major central banks is, to be blunt, too little too late. ...
The US is now headed towards recession regardless of what the Fed does. The build-up of real and financial problems – the worst US housing recession ever, oil at $90 a barrel or above, a severe credit crunch, falling investment by the corporate sector, and savings-less and debt-burdened consumers buffeted by multiple negative shocks – make a recession unavoidable. Other economies will also be pulled down as the US contagion spreads.
... Today’s financial markets are dominated by non-bank institutions – investment banks, money market funds, hedge funds, mortgage lenders that do not accept deposits, so-called “structured investment vehicles,” and even states and local government investment funds – that have no direct or indirect access to the liquidity support of central banks. All these non-bank institutions are now potentially at risk of a liquidity run. Indeed, US legislation strictly forbids the Fed from lending to non-depository institutions, except in emergencies.... So the risk of something equivalent to a bank run for non-bank financial institutions owing to their short-term liabilities and longer-term and illiquid assets, is rising... There is little chance that banks will re-lend to these non-banks the funds they borrowed from central banks, given these banks’ own severe liquidity problems and mistrust of non-bank counterparties.
www.rgemonitor.com/blog/roubini
Well, this is somewhat more dire than my own prediction, but definitely a head's up for my investment future.
Cheerio.
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Always look upstream.
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Quote:
Originally posted by SignyM:
[B Except me and my SO. We're doing OK financially.
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Always look upstream.
I think it's interesting that when the American people are polled a large majority say exactly what you say. People who are doing well see others not doing as well and assume things are bad in spite of their own situation. People's personal perceptions are not very useful when looking at the overall economy. If you ask the "poor" about their personal situation they are generally optimistic about their own future but pessimistic about the future of those around them. We tend to see the economy based on our own personal misconceptions and seek statistics to prove ourselves correct.
It also amazes me how people talk about a recession as if it's the end of the world. In many cases a recession is just a sign of the beginning of another economic cycle. Next time the economists call a recession it's time to load up on stocks that do well in the early stages of the cycle.
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Quote:I...actually agree with you on this, K.
Originally posted by Kirkules:
It also amazes me how people talk about a recession as if it's the end of the world. In many cases a recession is just a sign of the beginning of another economic cycle. Next time the economists call a recession it's time to load up on stocks that do well in the early stages of the cycle.
Chrisisall
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Quote:I'm well aware that most people see their situation as somehow better than others see it. The vast majority of parents of children in the worst school in the District still think their school is 'alright'. People who live in the least safe neighborhoods often think that the problem is 'really' the next block over. Polls of 'the insured' for the most part (95%+) think their insurance is OK, even if it has a horrible experience rate. Still, I know where our household income and assets are in the quintiles. Believe me when I say we're doing okay. You OTOH are prolly not doing as well as you think, if you think like most people. (And you prolly do.)
I think it's interesting that when the American people are polled a large majority say exactly what you say.
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You have a couple of bogus assumptions behind your sanguine reaction towards recessions.
1) If you're prepared for a recession.... unemployment, erosion of purchasing power .... and you've protected yourself against asset loss, then you've got nothing to fear. Swing away, and take advantage of the opportunities ahead. It's like Baron Rothschild said: The best time to buy is when there is blood in the streets. But most people are NOT Baron Rothschild. Most people don't have the resources jigger the markets to their advantage. A recession for most people means real pain. And that's what we're talking about, right? Most people. The middle class. Most likely you, and everyone reading this post including me. You have what's known as a "false identity": You really don't know where you are in the pecking order.
2) Secondly, it's stupid to accept cycles of boom and bust as somehow "necessary" for growth. It's not necessary. Growth is growth, and recession is not "negative growth" it's destruction of capital... most often accompanied by a further shift of resources to the wealthy. (Did you know that luxury goods never sold so well as during the Great Depression?)
So I'm glad you're feeling optimistic about the future, but think I know exactly where I am in the pecking order.
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Always look upstream.
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Quote:
Originally posted by SignyM:
Secondly, it's stupid to accept cycles of boom and bust as somehow "necessary" for growth. It's not necessary.
Many of those reading this aren't even old enough to have experienced a deep recession. I agree that recessions aren't "necessary" but our understanding of macroeconomics hasn't reached the level were we can avoid them entirely. Thanks to the work of the great Milton Friedman http://en.wikipedia.org/wiki/Milton_Friedman recessions have become less severe in recent years and most recessions would pass unnoticed except for the political posturing.
That "the rich get richer" BS just doesn't fly with me because while the "rich" get richer the "poor" get richer too. As much as I would love to believe we can take money from the "rich" an give it to the "poor" and everything will be just dandy, I know it's not true. Redistribution of wealth by the government will result in a smaller "pie" to divide among the rich and poor and everyone looses in the end.
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Quote:Not always. I think I've made a good case showing that the poor have gotten poorer in the past seven years, not just in a relative sense but also objectively. And AFA redistribution of wealth leading to a smaller "pie" for all, much of the Eurozone has been growing well and they redistribute wealth pretty aggressively. And macroeconomics would explain why that should be the case. But I've spent way too much time on the board, so I'm afraid I'm gonna have to duck out of this discussion and come back to it later.
That "the rich get richer" BS just doesn't fly with me because while the "rich" get richer the "poor" get richer too.
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Always look upstream.
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Quote:Howz about we just limit government's ability to facilitate the rich TAKING money (Haliburton, Blackwater, anyone?) instead of making money? I'd be okay with that, wouldn't you, Kirk? Jong? Or do you guys really have no clue JUST HOW concentrated the wealth has become in this country?
Originally posted by Kirkules:
As much as I would love to believe we can take money from the "rich" an give it to the "poor" and everything will be just dandy, I know it's not true. Redistribution of wealth by the government will result in a smaller "pie" to divide among the rich and poor and everyone looses in the end.
I could envision a time when peeps here say, "Most homeless get regular meals at the soup kitchens, and have portable 20" flat screen tv's to watch in their cardboard boxes- they're doing fine compared to the poor in the third and fourth worlds!"
A matter of perspective Chrisisall
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Eh, one LAST post!
If government had not specifically meddled in the war between the classes- the owners on the one hand and the employees on the other- we would prolly be seeing huge international labor unions battling it out with huge megacorps. I'm not sure there would be peace. (Watch Harlan County some day.) In some ways, politics is better than the alternative.
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Always look upstream.
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