Home › Forums › Financial Markets/Economics › Are savers doomed?
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livinincali.
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January 8, 2015 at 3:11 PM #21364January 8, 2015 at 3:16 PM #781731
spdrun
ParticipantIf you’re putting the money into the right things, you’ll be fine. The right things might just not be savings accounts right now 🙂
January 8, 2015 at 3:22 PM #781732an
ParticipantYes. I don’t see rates going up much any time soon.
January 8, 2015 at 3:25 PM #781733ParticipantBut you could have low rates coupled with deflation. Meaning that people that didn’t buy stocks, commodities, housing might be better rewarded for having held off.
Interest rates are only a part of the equation.
January 8, 2015 at 3:37 PM #781735The-Shoveler
ParticipantIMO the least likely thing to occur is long term deflation.
You might get a dip here or there but TPTB will do “ANYTHING and EVERYTHING” in their power to avoid it (for very good reasons BTW).
IMO we will start to finally see wage inflation even if they have to force it from the bottom.
January 8, 2015 at 3:46 PM #781736
CoronitaParticipant[quote]
55 people with less than $60M VC funding can create an app that sends more messages than the global SMS network combined, and be sold for over $19 billion dollar
[/quote]As much as we would like to believe this is “easy”, we all know that the percentage of people that actually succeed in pulling this off is a tiny percentage of all the people trying… (and I’m not talking about the technical feasibility of this)….
Not trying to discourage anyone from trying.. But, it would probably be best by also having a plan B…just in case….
But just from personal observation. This country, imho
1) punishes savers that don’t do anything with their earned income.
2) punishes speculators that like to go against the grain of our planned economy
3) encourages people to act financially irresponsible with the expectation that the ones that are responsible should help pay for those that aren’t.
4) Salaried employees probably are in the worst shape in terms of accumulating wealth
*On one hand, you have some wage pressures from cheaper labor
*You’ll have employers that want to either decrease benefits or increase the costs they pass on to you (think health insurance or PTO)
*You’ll probably have more payroll taxes moving forward.. For example, medicare tax surcharge, our nice CA “wealth tax”…
* And you have very little wiggle room to avoid or cirmcumvent any of the previous things mentioned.And it will get that much harder.. I think fewer and fewer tools will be available to allow individuals to accumulate assets and build net worth..Tax treatments will be gradually removed or phased out.
January 8, 2015 at 4:14 PM #781740Participant[quote=The-Shoveler]IMO the least likely thing to occur is long term deflation.
You might get a dip here or there but TPTB will do “ANYTHING and EVERYTHING” in their power to avoid it (for very good reasons BTW).
IMO we will start to finally see wage inflation even if they have to force it from the bottom.[/quote]I totally agree. TPTB hates deflation and they will do anything to keep it from happening for a long period of time.
I hope we start to see some serious wage inflation. We can start with a $15 living wage.
January 8, 2015 at 4:53 PM #781741ParticipantThose $15 min wage jobs will be automated away really quickly. Who needs a Mickey Dee’s cashier when you can have a touch screen?
But why are you hoping for it? If you’re interested in the same things most people on this board are, it will increase the competition to buy cheap r.e. and rent it out.
What’s in it for you unless you’re getting $10/hr?
As far as deflation, if it happens with rates at zero, there may be little that can be done to prevent it (QE4 would be seen as an acknowledgment of economic failure, which might actually speed the process).
January 8, 2015 at 4:58 PM #781742ParticipantAnything that can be automated will be automated irregardless of wages or anything else.
more and more sophisticated Automation gets cheaper and cheaper every year and it will continue to do so irregardless.
the world will adapt.
Long term deflation can’t work because it destroys long term investment, the US Gov is the biggest long term investor in the world.
January 8, 2015 at 5:28 PM #781743ParticipantNothing is forever — all empires fall. Even the US.
January 8, 2015 at 5:36 PM #781744Participant[quote=spdrun]Those $15 min wage jobs will be automated away really quickly. Who needs a Mickey Dee’s cashier when you can have a touch screen?
But why are you hoping for it? If you’re interested in the same things most people on this board are, it will increase the competition to buy cheap r.e. and rent it out.
What’s in it for you unless you’re getting $10/hr?
As far as deflation, if it happens with rates at zero, there may be little that can be done to prevent it (QE4 would be seen as an acknowledgment of economic failure, which might actually speed the process).[/quote]What’s in it for me? One simple word: inflation. I’m hoping for a repeat of 70s/early 80s, when wages were inflating like crazy. Look at what happen to rent and housing price then and you’ll understand why I want $15/hr. Better yet, lets go straight to $25/hr.
I got what I needed. Now, lets inflate away my debt.
January 8, 2015 at 5:41 PM #781745ParticipantCareful what you wish for: meanwhile your purchasing power from that rocketing rental income will also be eroded by inflation. Do you want purchasing power or money?
If you want money, just get a few trillion Zimbabwe bucks, dump them on your bed, and wallow in them laughing maniacally.
Personally, I’m hoping for a repeat of 1987, 2001, or 2008.
January 8, 2015 at 5:42 PM #781746Participant[quote=spdrun]Nothing is forever — all empires fall. Even the US.[/quote]
Outside of a large meteorite or Yellowstone going off (or nuclear war).I think that is extremely unlikely in the next few generations (for the USA).
in fact in the near term (say the next 50 years) I think that for the U.S.A. things look really really good even compared to Europe or china etc..
Anyway IMO.
January 8, 2015 at 5:43 PM #781747Participant[quote=spdrun]And meanwhile your purchasing power will be eroded by inflation. Do you want purchasing power or money?
If you want money, just get a few trillion Zimbabwe bucks, dump them on your bed, and wallow in them laughing maniacally.[/quote]$15/hr. minimum wage won’t get you Zimbabwe hyper-inflation. I said inflation, not hyper inflation. I want a repeat of 70s/80s, not Zimbabwe.
January 8, 2015 at 5:46 PM #781748ParticipantThe-Shoveler: I don’t think that anyone can prognosticate a year in the future, let alone 50.
Think about this: what happens if oil production and conversion to alternative energy in the US is vastly slowed, then a full-on war involving Saudi Arabia breaks out in 2017? Causing oil to hit $400/bbl.
AN: I was exaggerating a bit. But seriously, if you want inflation to feel good about how much money you’re making, buy some Zimbucks.
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