Paycheck to Paycheck

[Revoltingest]

To say that low bank interest rates is not a problem is Bunkum.

No, it's "bankum".

Most old people rely on such savings. to day in the UK bank interest paid to savings holders is less than 0.5% in the UK
This is way less than inflation. so savings are decreasing in value not growing.
However banks lend at way above the bank rate, and card loans are many time higher again.
Banks these days are in the business of "buying and selling" money. Not look after customers money,

I explained how interest rates are a function of inflation (currency devaluation).
As one who is both old & retired, I'm keenly aware of the dangers of low rate
of return on deposited case, inflation, & taxation. Inflation eats away at our
buying power, but as interest on deposits rises, government takes a good
chunk of it. So we're better off with low interest & low inflation.

Word of advice.....don't put your retirement nest egg in a savings account.
I put my money to work, but if I need more cash than I have on hand, I
have revolving credit to cover any financial disaster for a few years.
Credit is free so long as it's not used.

 

[Holdasown]

What? People are now starving and freezing to death while living under bridges and alleys with dead bodies laying around in the streets?

Well, I guess I can't really argue against such a profound argument.

America’s Tent Cities for the Homeless
We have a tent city a few towns over.

 

[PureX]

What no one teaches us is how to make money.
Sometimes it is the luck of having a great idea and making the most of it.
Sometimes it is taking someone else's great idea and exploiting it.
In almost every case, accumulating money, involves persuading other people to earn it for you.
there are not the hours in the day to do it for your self.
Capitalism is based on the idea of moving money into large enough heaps to be self sustaining.
This can only happen when there are few people owning such heaps,
and large numbers of people contributing to them.
In capitalism Equality is the antithesis of "Money Heaps"
Capitalists rely on a ready supply of wage "slaves"

Capitalism is a parasitic economic system. And it is therefor socially toxic. And until we face this reality as a nation, and instill some socialism into our economic model, it will continue to destroy us. Sadly, I see little hope of this correction occurring, and therefor I believe that total social collapse will be unavoidable. And our children will then pay the price for our willful ignorance, and boundless greed.

Of course, we don't really care about that.

 

[dfnj]

What do you think?

Here is the problem most people do not understand:

There are severe problems with laissez faire capitalism. This video on basic Marx political theory nicely shows what is WRONG with laissez faire capitalism:

Does man serve the system or does the system serve man? At some point over the last 30 years the system started winning. The power needs to come back to the people at some point. The problems with our country are NOT rocket science. The lobbyists force the politicians to pass laws creating cartels and monopolies in exchange for campaign financing. The CEOs, once they legislate away the free-market, can gouge the consumer by charging anything they want for products and services. The result is wealth inequality is at ALL time highs.

Corporations ARE the government. The lobbyists own the politicians. CEOs own the lobbyists. If we were truly socialistic or communistic wealth inequality would be more equitable. But it is not. I hear lots of right wingers and conservatives define what it means to be a liberal and Democrat. But I think FDR does a much better job defining what it means to be a liberal Democrat:

An old English judge once said: 'Necessitous men are not free men.' Liberty requires opportunity to make a living - a living decent according to the standard of the time, a living which gives man not only enough to live by, but something to live for.

For too many of us the political equality we once had won was meaningless in the face of economic inequality. A small group had concentrated into their own hands an almost complete control over other people's property, other people's money, other people's labor - other people's lives. For too many of us life was no longer free; liberty no longer real; men could no longer follow the pursuit of happiness.

Against economic tyranny such as this, the American citizen could appeal only to the organized power of government."

I hear a lot of right wingers complain about taxes. But what you pay in taxes is irrelevant. All that matters it the purchasing power of your take home pay. There has been only one presidential term in the last 60 years where the amount of slices of bread a dollar could buy increased after four years. The remaining 56 years has been nothing but an upward spiral of inflation and less purchasing power per dollar.

But do not worry my comrades. Marx always said laissez faire capitalism is always followed by communism. This is because unfettered greed would result in the government's currency collapsing to nothing in value. Once the currency is worthless, people in breadlines will demand MORE government not less. See you in the breadlines comrades!!

 

[Revoltingest]

Capitalism is a parasitic economic system.

Yeah....we'll have to agree to disagree about that.
I see it as more cooperative & liberal (classically).
If you like success & liberty, no alternative beats it.

 

[metis]

Very often, those "unsustainable lifestyles" are not the fault of those living them, either. They happen because of ignorance, and disease, and abuse, and neglect. Think about it; do you really believe that anyone consciously CHOOSES to become a drunk, a drug addict, hopelessly unemployable, willfully ignorant, life-losers? So how did they get that way?

I hear ya and I fully agree. Gotta tell ya a true story.

A guy I used to bowl with several decades ago was a VERY proud conservative-- hard-nosed, to be more precise. Well, he lost his job in the tool & die industry and couldn't find a decent job for almost two years, almost losing his house and his wife in the process. Knowing how I felt about this, he came up to me and said he never will be so judgmental again since he found out what it was like and how our very lives can hang by a thread.

 

[PureX]

Yeah....we'll have to agree to disagree about that.
I see it as more cooperative & liberal (classically).
If you like success & liberty, no alternative beats it.

If you think socio-economic darwinism is "liberty" then I think you need to think about it a bit more deeply, and certainly more compassionately. Because the freedom to be used and abused by anyone with a bigger wallet does not sound like liberation to me. It sounds more like strangulation.

 

[Terrywoodenpic]

No, it's "bankum".

I explained how interest rates are a function of inflation (currency devaluation).
As one who is both old & retired, I'm keenly aware of the dangers of low rate
of return on deposited case, inflation, & taxation. Inflation eats away at our
buying power, but as interest on deposits rises, government takes a good
chunk of it. So we're better off with low interest & low inflation.

Word of advice.....don't put your retirement nest egg in a savings account.
I put my money to work, but if I need more cash than I have on hand, I
have revolving credit to cover any financial disaster for a few years.
Credit is free so long as it's not used.

My best returns are on share based ISA accounts which are free of tax on both interest (reinvested) and growth.
I also have a non ISA share investment account, protected in an insurance wrapper, which though not tax free is well ahead of the field. Both sorts of ISA's are fully managed. but have a low annual management fees.

I doubt you have ISA investments in the USA but we can invest up to £25K per year in such schemes in the UK. I am pretty sure Americans can not invest in our schemes as they would be illegal in the USA under your rules.

You can draw down from such accounts at any time, though I have never done so. So apart from the vagaries of the stock market they are very rewarding, and as adventurous or safe as you wish to select. though a totally safe investment is not an investment at all.

 

[Revoltingest]

If you think socio-economic darwinism is "liberty" then I think you need to think about it a bit more deeply, and certainly more compassionately. Because the freedom to be used and abused by anyone with a bigger wallet does not sound like liberation to me. It sounds more like strangulation.

Still....no acceptable alternative to capitalism.

 

[Revoltingest]

My best returns are on share based ISA accounts which are free of tax on both interest (reinvested) and growth.
I also have a non ISA share investment account, protected in an insurance wrapper, which though not tax free is well ahead of the field. Both sorts of ISA's are fully managed. but have a low annual management fees.

I doubt you have ISA investments in the USA but we can invest up to £25K per year in such schemes in the UK. I am pretty sure Americans can not invest in our schemes as they would be illegal in the USA under your rules.

You can draw down from such accounts at any time, though I have never done so. So apart from the vagaries of the stock market they are very rewarding, and as adventurous or safe as you wish to select. though a totally safe investment is not an investment at all.

Things are different on this side of the pond.
Interest income is taxed.
But it can get worse.....
If I lend money at too low a rate of interest, the IRS will tax me based on
"imputed interest", ie, the income which they say I should have received.

 

[PureX]

I hear ya and I fully agree. Gotta tell ya a true story.

A guy I used to bowl with several decades ago was a VERY proud conservative-- hard-nosed, to be more precise. Well, he lost his job in the tool & die industry and couldn't find a decent job for almost two years, almost losing his house and his wife in the process. Knowing how I felt about this, he came up to me and said he never will be so judgmental again since he found out what it was like and how our very lives can hang by a thread.

Your friend is an exception, I think. Because most people, when they find themselves is such perilous circumstances, will blame others all the more for it, rather than admit to their own ignorance, and change their own minds. This is how the criminal oligarchy keeps us all frightened and turned against each other, when we should be angry and turning against them.

 

[suncowiam]

There are more people dying in the streets of this country than we realize. And if the republicans continue to gut and eliminate social services, as they certainly intend to, it will get a lot worse. All you have to do is look at how people live and die in countries where there are no effective social services. And you will see our own future, if we continue to allow greed, political corruption, and this "every-man-for-himself" economic philosophy to control our collective well-being.

Ok, I'll cut through your emotional appeal.

I lean towards the left and do favor social welfare. BUT... My brand of welfare is best described as temporary welfare. Every one deserves help. As a society, we should help those that are down on their luck. We should help those without skills to be self sufficient and self sustaining. Not by simply throwing money at them. We train and educate them. We give them temporary housing, food, clothes until they can give it a go by themselves. We have to give them the ability to succeed then we'll solve the root of the issues.

The whole discussion of a wage not being sufficient is deceiving. We have to understand case by case why each individual has failed to sustain themselves before suggesting what the real issue is.

 

[PureX]

Still....no acceptable alternative to capitalism.

There are all sorts of alternatives to capitalism. The ones that are working the best, for the most people around the world, are socialist. Even our own capitalist system has been forced to accept socialist ideals and practices to keep it from destroying us. Unfortunately, as the generations pass, we forget those hard won lessons, and we've neglected to maintain them. And we are suffering the consequences, yet again. People died in the streets of this country fighting the "robber barons" (oligarchs and plutocrats) of the past. Especially after their boundless greed and corruption drove us into a horrific economic depression. But the socialist policies we instilled in the system at that time, to mitigate the damage of unbridled greed, have now been mostly dismantled, and the republicans in government are working hard at eliminating them all. And we are letting them, because we were not alive when they drove the nation into socio-economic collapse, before. And we have not yet suffered the full horror of the results. But we will. And when we do, you will no longer be spewing this nonsense about how there is no better way.

 

[suncowiam]

America’s Tent Cities for the Homeless
We have a tent city a few towns over.

Many homeless people have mental disorders.

Some actually choose to be homeless.

And there are those that are forced to be homeless, but that doesn't prove how and why they became homeless. We have to break down every aspect of their lives and history to fully understand it. It's deceiving to just blame it on the economy and expectations of the government.

 

[PureX]

Ok, I'll cut through your emotional appeal.

I lean towards the left and do favor social welfare. BUT... My brand of welfare is best described as temporary welfare. Every one deserves help. As a society, we should help those that are down on their luck. We should help those without skills to be self sufficient and self sustaining. Not by simply throwing money at them. We train and educate them. We give them temporary housing, food, clothes until they can give it a go by themselves. We have to give them the ability to succeed then we'll solve the root of the issues.

The whole discussion of a wage not being sufficient is deceiving. We have to understand case by case why each individual has failed to sustain themselves before suggesting what the real issue is.

And then we, ... what, ... shoot those who did not respond to our "temporary help" as we demand that they must? Or do we just declare them "lost and damned" and leave them to die in the streets, so that everyone else will see that they'd better learn to tow the line? And we are doing this why, exactly? So that we don't have to expend any more time or money than our conscience makes absolutely necessary, on anyone else? Is that the idea? Or are we "playing God", perhaps, as we pass judgement and condemnation on those who won't "tow the line" as we deem they ought?

How do you propose we view ourselves, as we see others failing to comply with our expectations of them?

 

[Revoltingest]

There are all sorts of alternatives to capitalism.

In theory, yes....but in reality, none which have worked well for another country.

 

[Terrywoodenpic]

Things are different on this side of the pond.
Interest income is taxed.
But it can get worse.....
If I lend money at too low a rate of interest, the IRS will tax me based on
"imputed interest", ie, the income which they say I should have received.

We can be stuck with that too.
Interest and capital gain is usually taxed.
But ISA's are exempt. they were set up by the government with the finance industry to encourage savings. originally they were only allowed for about 10k a year, but with inflation that has been increased to 25K.
But as the first £1000 of interest is free of tax anyway, lower earners and pensioners never pay much tax if any on savings investments.

 

[Akivah]

I agree with you. I don't live paycheck to paycheck. I always try to keep a minimum of about 3 months worth of money needed to sustain myself should I lose my job. I do this by putting back money evey chance i get, literally. Even if I only have $20 to add to it, I do it. It adds up!

Meanwhile, I have 2 friends that make more money per year than I do, but have roughly the same amount of bills per month. 1 lives paycheck to paycheck sometimes with only $1 or $2 in his account by the time his next paycheck arrives.

The other and his wife, live in massive debt. Multiple credit cards maxed out, had to consolidate their debt with a home refinance, just to turn around and max back out their credit cards again, all the while living paycheck to paycheck earning 3x more than what I do, so wasteful.

You bet it adds up. It's called the power of compounding. Thirty years ago, I worked out a budget and started saving. Now, I'm in the top 10%.

I saw a chart somewhere that compared how much needed to be saved at each age group to get to $50K by age 70. I think a 40 year old needed 176 per month, a 50 year old needed 860 per month and a 60 year old needed 3900 per month. Compounding is great when you make it work for you.

 

[Akivah]

But we pay income tax on interest earned, so when interest
rates are higher, the net-after-tax economic payout is even lower.

That's only true in rare circumstances if your interest payment puts you into a much higher tax bracket. Normally, one makes more interest income the higher the interest rate is.

after tax interest income = interest earned x (1-tax rate)

 

[suncowiam]

And then we, ... what, ... shoot those who did not respond to our "temporary help" as we demand that they must? Or do we just declare them "lost and damned" and leave them to die in the streets, so that everyone else will see that they'd better learn to tow the line? And we are doing this why, exactly? So that we don't have to expend any more time or money than our conscience makes absolutely necessary, on anyone else? Is that the idea? Or are we "playing God", perhaps, as we pass judgement and condemnation on those who won't "tow the line" as we deem they ought?

How do you propose we view ourselves, as we see others failing to comply with our expectations of them?

Yes, we should definitely shoot them or better yet, decapitate them...

That will show them that they will need to succeed.

Or we can simply extend the temporary help. But at some point, yeah, some are lost souls that might not want to be helped. At this point after much support, I'm fine if they become homeless. Don't say that we didn't give them a chance.