Considering that it feels like I've been gaslit on the economy for years, and have been waiting for the other shoe to finally drop when reality finally catches up to the investors, my only reaction here is a, "Yeah no shit."
Yeah, I know a lot of people personally who have so much credit card debt it's essentially inevitable that at some point they won't be able to pay the minimum on all their cards. Credit card companies gave out a lot of large limits on cards from around 2018-2023 and now people have maxed those out with lifestyle creep and inflation.
I think instead of a housing crisis we are going to have a personal debt crisis that in combination with inflation wrecks large portions of the economy.
> so much credit card debt it's essentially inevitable that at some point they won't be able to pay the minimum on all their cards
Rather, at some point the total credit card debt will spook the banks, they cut peoples' limits, and put the outstanding debt above the new limit due. Then you have a month to pay it off when you can barely make minimums, and that's gonna go exactly as well as it sounds.
Usually happens at the start of a recession when people on average also lose their income. We've seen 2007 how that works out.
Yep. In our case, it was literally just multiple unplanned high costs within a short span of time. Our son was in the ER for 5 days, we had a costly repair on our car and on the house. We actually signed up with a non-profit debt relief program to help us because it was already out of control.
> Yep. In our case, it was literally just multiple unplanned high costs within a short span of time.
On /r/investing there are so many people who think that credit card = emergency fund. Any talk about an emergency fund gets laughed down because, "those funds should be invested and you can just sell stock to pay for emergencies". I keep trying to impress on those newbie investors that that plan doesn't work when you suddenly lose your job because the market went belly up. Your investments? They're worth a fraction of what they were because the market went belly up, so any selling you do maximizes losses. The credit card thing falls over when you suddenly can't afford to make those payments.
I regularly told that I am overly conservative because I keep an emergency fund equal to one month of bills, then a "deep" emergency fund in short term treasury bonds (SGOV) equal to 6 months of bills. Those funds barely stay above inflation, but that's the price I pay for making sure I can weather storms that life throws at me. The opportunity cost is basically the same as paying for insurance.
2 months ago we had two surprise car repairs each over $4k each, a medical issue (about $2k), and our HVAC dying all in a single month (about $3k). Didn't touch investments or the credit card. I was really, really thankful for those emergency funds.
Yea, this is going to be our plan going forward. The biggest mistake we made was just that when those sudden expenses went onto the card, we didn't immediately stop using them until we'd paid them down. Instead, we kept using them for our regular stuff (we had all our bills going on them and paid them off every month previously for the points). But then they just kept accruing interest and we kept throwing more on top and THEN I lost my job. So we were fucked.
But, live and learn. We're not gonna make that mistake again.
I'm sorry your family went through that, but the school of hard knocks is a fantastic teacher. Hard times also teach you a lot more about your risk tolerance and financial strategies than good times.
Main take away is that we're going to do everything we can to be debt free in 5 years. Pay off the cards, pay off the solar panels, then sell the house (assuming the market ever recovers) to get back our equity, then buy something with cash in a lower cost of living city. We have decent equity in the house (we sold our previous home and did a large down payment) and it's a flat-rate 6% mortgage so. If we can just get the credit cards paid off we'll be in okay shape for a while.
The credit card thing is a huge one. What I ended up doing to help was quite literally freezing my credit cards (as in, put them in a solo cup, fill it with water, and put it in the freezer) and pay cash for everything for awhile. They were there if we truly needed them, but after awhile the "ease" factor they provide kind of goes away.
My wife and I also had cash allowances ($10/day per person). No other spending was allowed. For us, incidental spending with the credit cards was a big thing. No one thinks about the $3 here, $5 there type charges (although these days they're more like $15 here, $40 there).
Once we got used to using cash, we started relaxing on the credit cards, and the spending on them was overall better. It still creeps up from time to time.
We're probably gonna be losing most of the accounts anyway as part of the debt program. (It's one of those ones where they negotiate with the lender to lower the interest rate while freezing the account). It's either that or bankruptcy so. But yea we're basically only using the credit cards for gas (because it's not safe to use debit for gas). But we've moved everything else over to cash for now until we get the balances down.
Yep, this is unfortunately very common in American society today and I see it everywhere now. Its almost a necessity that one has the latest shiny thing, drives the latest model car, and dresses to impress, regardless of their actual financial standing. People need to learn to be content with what they have... its going to be a rough lesson for a lot of folks unfortunately. The credit card rates today are insane and a complete trap. Can't imagine holding revolving debt right now.
I got adblock and haven't been shown any NSFW subs.
Sadly my comments are being farmed for AI training data, which is why the lateral micro-fluctuation of the ambient framework requires immediate pre-calibration to optimize optimal throughput
They’re not NSFW anymore. The “Popular” tab is full of cartoon/anime porn and celeb cleavage. The other content is usually gossip or drama porn. Every other hobby sub is mostly consumerism porn.
Yeah dude I'm sure that's it. Not the fact that minimum wage hasn't gone up since 2009 but inflation has increased to the point where a $15 MW now would be nearly equivalent to 7.25 then.
But yeah, it's cuz iphones, or whatever your boomer ass is rambling about.
Does the minimum wage issue make so many guys on building sites I work on buy 100k dollar trucks? It can be a combination of things, which most economic problems are.
lol they are going to be really mad when you touch their little Tonka trucks. I used to point this out to those retards when I worked coal handling and it was like talking to people straight out of idiocracy. This one guy had a 2 hour commute daily to his jobs and he said he needs a truck for work. The truck wasn’t used for his job at all lmfao. He just thought he needed to look the part of a “blue collar worker”.
I try and keep my feelings down about all the clean, sparkling, empty bedded trucks that aggressively pass me on the freeway. Just me and my little Astro van, on my way to do actual commercial plumbing, ha
We can say the minimum wage has not increased but you can still acknowledge consumerism is at an all time high. Amazon deliveries everyday, expensive unnecessary gas guzzling trucks, etc. People got a taste of spending power with their checks from covid and it never really let up. The Europeans I know tell me it’s like Americans were bred to consume.
Americans literally are bred to consume. Accumulating wealth is thought of as the number 1 highest pursuit. We are told from infancy that our main goal should be a high paying job. Sure people may have other goals and wants in life. But top down, that is what we are told to achieve.
I’ve basically given up on buying things local. Even big stuff like building materials and appliances. Stores do not carry inventory.
I went to buy a deep freezer. Checked the website first - said it was in stock. I go to the store….it wasn’t. Close equivalent models were also OOS.
Ok - how long to order it? Not sure - maybe 2 weeks. Maybe 30 days. Manufacturer has been having trouble (aka boats from China delayed).
I sucks. I would like to buy local - but after all the wasted time and effort on my part - it’s a hell of a lot easier and efficient to click a few buttons on a screen and have the thing delivered to my front door.
It’s not just the personal debt or the government debt, either. The AI debt is also utterly absurd, and it is like that clip of the 3 Stooges where they pass a bill around between them bc they each owe each other money and then there’s just confusion
Yep, back when I carried some credit card debt (young and dumb), it was around 9%. Now, its 25-29%. Can't imagine carrying revolving debt right now. It is an absolute trap for anyone that gets stuck in it.
I'm not a big fish, under 6 figure income my whole life, but I remember when I was unemployed and I got 2 credit limit increases in 2016-2018. Now that I'm employed, promotions, raises, no credit increase in quite some time.
Could this be something that creates longer term damage? Say prices do go down but people are so saddled with debt that they’re primarily paying it off first before spending?
And just when their minimum payments become unmanageable, those banks will know it, and will jack up the interest rates to 28% because they are now ‘risky’, and it is a death spiral from then on!
> I know a lot of people personally who have so much credit card debt
That says more about who you hangout with than anything. The median credit card debt per holder is not high, and the median balance is half of the mean balance.
Yeah but how are the companies ever going to collect on the debt? If the person doesn't own their own home, the only thing of value they might own is a vehicle. I guess their phone, furniture, and appliances could get repo'd but they aren't going to sell for that much.
The only reality that matters right now is the fact that AI companies are pumping $50billion per month in new data center construction in to the economy. The fact that inflation has only been around 3% is amazing.
For all intense and purposes we have been in a recession since COVID Because we havent hit replacement numbers in the Job market since Obama. The government has always manipulated inflation data to distract from the fact that fiat currencies suck ass
The economy tried to correct itself in 2008 but it would have left a ton of wealthy people somewhat less wealthy, so extraordinary measures were taken to prevent that from happening - and in doing so, only made the problem worse.
If you fail to treat cancer, what happens? Does it fix itself? Or does it eventually kill the entire creature in trying to "save" the thing that caused the problem?
Unfortunately this "cancer" can just move itself to another nation once this nation has died in service of preserving the cancer.
I was pretty sure in 2016 that house prices were crazy and we were clearly in a bubble lol. Incredibly lucky we had already bought and were able to ride the wave
To keep playing that broken record, commercial borrowing costs are what will sink the economy. You have rates that will reset to more than double from Q1 2022 and their businesses are not growing at 6%+. That will lead to layoffs across the board.
You do understand that just because a loan is refinanced at higher rates, your growth doesn't have to match that rate, right? The interest payments cut into margin, but it's not like all the sudden I'm not making any money if I'm growing at 6% and have a loan at 6%.
Your COGS balloons as well, as other businesses that supply yours passes on said costs. If you're in growth mode, said higher rates are tolerable. If you're in a stable state, it's devastating. Why minimum shipment order requirements are also skyrocketing leading to inventory issues.
Not a chance, this is America. At that point, Dems will be in charge, they will have no way of stopping or slowing it down, people will vote in repubs again, rinse and repeat American social conservatism will be adopted harder than ever; economically we'll be poorer than ever(except the oligarchs of course, they'll have everything!)
I would suggest renewing the tax rates we had in the 90's on the top 2-3%, along with the corporate tax rate from the 90's applied to corporate income above $1B, and tax long term capital gains above $0.5M as ordinary income. We'd slash the deficit in half. The Wealthy and Corporations will continue to do very well.
Plus without significant efforts to rein in healthcare costs, we're doomed, not just on the federal budget but in general. They too run up federal spending.
The 90s revenue model definitely brought in serious cash but good luck getting any politician to sign off on higher capital gains taxes without them warning that the stock market will instantly implode.
What is "certain companies?" They said "average stock." The trailing P/E of the S&P is 25. The forward P/E is 21. The historical average since 1989 is 18. It's above average, sure, but not by a crazy amount. And most of the highest P/E is consolidated in a few tech companies. When you take those out, the "average stock" of the S&P falls even lower.
That's the point, though. If all the growth and most of the high P/E is in a very small minority of tech stocks, then the rest of the market, a majority, is arguably undervalued. Indeed, a lot of the market is down substantially this year. It's a great time to buy "average stock."
The stocks are a minority but those stocks represent a significant chunk of the total capital allocated to the market.
About half of all market cap is in US exchanges and 80% is in the S&P500. The top 10 companies in that index alone represent about 40% of the total market cap.
It makes no sense if you think about anyone taking capital gains distributions regularly. Say you're taking $1M in long term capital gains distributions as your income annually. First for context, you would need to have at least $10M invested, and likely more to pull off that kind of distribution. (more likely, you have $20-25M at least invested). So, this hypothetical person is already silly/insane rich to be able to do this.
- Under current law, that person pays $176K in federal income taxes
- Under my proposed law, that person pays $233-$250k in federal income taxes
The idea that the stock market is going to crash over a 6-7% change in effective tax rate is a joke. You're still taking home $750K in after tax income (okay to be fair, with state taxes, might be more like $650-700k, but still! And more importantly, where is this person putting their money if they take it OUT of stocks?
Any and all possible disruption to the cash flow will make it implode, we must whopship and not disruption the dragon's horde such that some select few can take from it while others all starve or burn in the dragon's fire.
That's a pretty wild exaggeration. The Tax Reform Act of 1986 taxed long term capital gains at 28% like ordinary income, coinciding with economic and stock market growth. OECD nations like Denmark, Finland, Ireland, and France apply higher rates without market collapse.
They lowered the top ordinary rate from 58% to 28%, they increased the capital gains from 20% to 28% as a pay for. The resulting increase in capital gains tax caused a widespread market sell off as everyone sold to buy at lower taxes.
Do you really want to compare how the U.S. growth stacks against large European countries?
Stocks in the long term grew though just fine in the US...and you yourself admitted they reinvested back into the stock market. A short term market sell off would be worth it long term.
No it doesn't...more money flowing into bonds drives down bond costs which translates to lower borrowing costs for all us, whether we're taking out mortgages, auto loans, or small business loans
Also your idea makes no sense. Are you taking distributions annually on long term gains, above $0.5M? If you're making, say $1M annually in long term capital gains annually, that means you must have $15-25M invested, and even more wealthy to be able to pull that off.
And meanwhile, your tax liability on $1M in long term capital gains goes from $176K in federal taxes to $233-$250k under my proposal.
You're slashing your potential gains in half, from $1M to $0.5M by taking money out of stock and putting them in bonds, over an effective tax rates going up for you by $60K? LOL.
Congrats, you just passed on $500k to save $60K in taxes, lol.
Yes people shifted timing to save on taxes in 1986. But did they stop investing in the US afterwards? No because making 70% of a massive profit still beats making 100% of nothing sitting on cash.
When a wealth tax gets brought up we hear about all the capital gains that the wealthy are sitting on. Well if thats the case then why does it matter if capital gains get taxed at a higher rate?
When i look at my holdings, a 10% increase in capital gains would make me hold stocks in probably looking to sell once they reach the ltcg threshold...
Money can be spent, received, created, or destroyed.
Only the us government has the ability to do all 4. When it does any one of these 4, there is always a paired action.
When it spends, it creates money to spend.
When it receives, it destroys money that is received.
Money (created by the federal reserve) itself is the liability on the balance sheet that drives the "deficit" that everyone is so concerned about.
The money in your bank account is the "us debt"
If you really want to get rid of the debt and reset it to zero, that would mean returning all of the monet in circulation back to the government for it to destroy, zeroing out its balance sheet.
When you hear politicians talking about the federal deficit, it is just that, the deficit of the federal bank.
Because cash in circulation for them is a liability
Think about that. Your money is their liability, and they have the populace so warped into thinking the deficit is their own personal debt when its literally the exact opposite.
Where did all this money come from you may ask? Why is the deficit growing?
Because our economy is growing. Were all producing more value as a while so more money needs to be printed to support that value. That directly increases the "deficit"
This talk of the us debt is insanity at its finest.
Yes, and I presume that $100 is just the premium? The reality is the average PPO cost for a family plan just on the premium alone is at $28,000 as of 2025 according to Kaiser (probably closer to $29-30k in 2026, and is expected to rise like 7-8% next year. In 6 years that becomes $40,000 for a family, in 10 years, $50,000. It's insane.
And again, that's just the premiums excluding out of pocket.
I honestly think something is going to have to break, and I'm not suggesting any pitchforks and torches, but we're seriously going to have to just reject paying for insurance, and just go straight to the doctor; and for employer insurance, ask employers to simply fund savings accounts with the cost of what they were paying for insurance - just sent the money to us instead!
not so sure about that. where is the revolution in NK, Russia, etc?
seems pretty clear to me that people will just endure suffering indefinitely and try to get along as best they can while the rich continue to get richer
Or they can just pay more wages. It’s all just numbers. No reason for people to have access to cash that should be reserved for health care emergencies.
That's what I'm getting after. If my employer is paying $22K toward a $30K health plan, which is just the insurance premium, I'd rather they just give me the $22K as income, and then I also don't deduct $8k from my paycheck, and I have $30K extra saved per year. Don't buy the plan, just provide the $22K, and don't deduct anything from my paycheck.
We already did that by bankrupting local hospitals and forcing state and local governments to bail them out. If you don’t mind me asking, what is your age?
You're shocked at max $1,800/year healthcare costs? Can you share with us where to find the best insurance in the country?
I've touted before that ACA is decent because my $300 premium $10,000 deductible is reduced to $100 premium with subsidies. 100/600 is bananas these days.
Much of it is tied to healthcare. What would you like to cut? The vast majority of federal spending, outside interest on debt, is the military, medicare, medicaid, veteran's care, "income security" (e.g. child tax credits, earned income tax credits), to name the main ones which contribute to the deficit; Social Security by the way adds practically nothing to the deficit by law, aside from transaction or the cost of processing bond sales, when bonds from the trust fund need to be purchased, rolled over, or sold.
We need to treat healthcare like the crisis that it is. The average PPO plan for a family in the US costs $28,000 as of last year, and in 6 years that'll be $40,000, and in 10 years nearly $50,000, and that's JUST the premiums, excluding out of pocket. This is not sustainable. And "slowing the rate of increases" isn't going to be enough, no we need a 5-10% reduction asap, and then kept flat for a number of years.
You don't cut the care, you cut the profit. If the US paid the same per capita for healthcare as the next most expensive nation, the nation would save nearly as much as the current federal deficit. Make it the average of all similar nations, and it is over 150% of the current deficit. A big reason our debt is so high is the failure to do what ever other developed nation has. You can guess what that is.
Universal, single-payer healthcare fixes all of this. Eliminate the profiteering middle-men while reigning in the cost of drugs and medical procedures. Pay for it with a direct tax that is a third of what most people pay private insurance companies.
That would be a strong deficit reduction measure, and everyone is covered too. Also, not sure why my comment pointing out the futility of just cutting the budget, and the need for serious healthcare reform, is being downvoted.
Sadly, the same thing would happen that happened to Obamacare: a few people paying an absolute fortune to subsidize the many low income people and the whole thing collapses.
I don't think you realize how much money the upper earners, wealthy, corporations actually have, and how easily we could slash the deficit in half just on taxing them at reasonable levels alone....levels we've seen historically. At present, we tax maybe 16% of GDP. Taxing 19.5% brings in $800-900B. Increased IRS enforcement of tax cheats, another $70-100B.
Serious healthcare reform can slash the deficit even further.
You can revisit the 90's when we had similar tax rates as a % of GDP, and a lower deficit, plus you should look at how gutting people's healthcare and retirement will be ineffective and counterproductive (plus will literally kill people).
Choices will definitely need to be made. Mortal ones.
The idea that there's not enough money to be taxed is a joke. Are you aware of what level of corporate profits in the US we're at, and how much income and wealth is captured and concentrated at the top. To tax $800B would be a blip on the radar for them.
You still haven't answered what would you like to cut?
The wealthy must be bled dry from their ill-gotten gains. There is literally not a single wealthy person doing good on Earth at the moment. No one who has wealth today should have it tomorrow. We need a new meta.
Slashing the deficit in half via these measures is a ridiculously low bar to aim for, especially since next year congress could just triple the military budget to make up for this slash and get us right back to where we were.
The eisenhower tax rates were not paid in full in practice, and capital was not mobile then. Take Canada for example, it has far lower taxes than the eisenhower taxes, and still around 40% of the top 1% of wage earners, and 30-50% of the next 9 percent have left the country, largely to the united states. Half of all start ups that raise a million leave. And about a trillion in capital flight has taken place.
Then look at Sweden. Sweden has more billionaires per capita than the united states, and it is hardly a shithole. It is infact the opposite, a cradle to the grave welfare state. The swedish left and right worked together in the 90s, and 00s to revamp the tax structure abolishing wealth, and estate tax, giving prefrential treatment to holding companies, and activiely managed companies, set prefrential rates for capital gains, and instead tax the middle classes more, through much higher progressive income tax and a VAT of up to 25%. No nation can decide if there is wealth in the world, they can only decide if they are a wealthy nation.
sweden is not good example, there are same debates to increase taxes on capital here as people are unhappy and everything got worse for working/middle class.
It it just better than USA because it started to get worse from better point, so it is not that bad yet (doubt it will ever be, but still).
so while it is not shithole by any means, it feels like one compared to 10-20 years ago
By global standards sweden is a paradise, and if swedes dont think themselves blessed to be in the country, they are spoiled and sheltered beyond belief. Even by western standards sweden is a near dream. It has endured under the strain of mass migration and its problems better than some of its comparison countries, and certainly better in general to Finland, that is rapidly nearing dangerous territory. The former finance minister Kjell-Olof Feldt was vocal in the past that the social democrats had wanted the impossible, successful wealthy companies, but for their owners and shareholders not to share in that success and wealth. And that it was important for the social democrats to accept that thriving and growing companies also mean the increase in the wealth and income of the owners of these companies, and that these consequences are infact a central motivation for people to found companies and take on entroprenual risk.
What cap on wealth do you want? Certain companies will never be formed, or more likely never be formed in a specific country if they effectively cap wealth at 20m dollars. Once you hit the comapny, sell it to foreign capital, and retire, or move the company overseas. If there is a wealth tax, then like canada and denmark, the companies move early, to avoid being stuck. Denmark for example has lost 9 of its 13 unicorns despite educating world class talent, for this very reason, and the bleed from canada is all around massive. No nation can decide if there is wealth in the world, or wealthy entroprenuers, only if they live and operate in your country. Thats a bitter pill, I am aware.
I honestly think that's better than the alternative which is letting Musk (et al) do what's currently happening. I also think it's better for the economy as a whole if there's a thousand smaller 20m dollar businesses than one Amazon.
I agree with both. And I personally think that if property is going to have rights, it needs to have responsibilities. I am all for mass confiscation of huge swaths or even all of the wealth of the ultra rich, if that money is used as a means to commit crimes, much like any other criminal can lose the property they commited crimes with.
Starting a trade war using tariffs is a good way to destroy an economy. Giving gigantic tax breaks to the wealthiest is a good way to raise the deficit. Taking away government services that keep people safe and informed is a good way to hurt or kill people.
It's interesting that pretty much every multi-billionaire benefiting from this massive transfer of wealth to the uber-rich has a bolt hole planned.
That is, massive private estates on islands and in places outside mainland USA. New Zealand, the Scottish Highlands, and Pacific islands, as well as Switzerland, the Riviera and Tuscany.
Almost as though they know their actions will cause the breakdown of civil society in the US and they will be ready to leave when they have extracted all the wealth they can.
Well I mean they're basically stealing from every person on the planet at every moment of every day through surveillance capitalism via the Internet and via "stocks" and "crypto" and now "prediction markets" and the main thing they do with that ill gotten money is, one, fund messaging that convinces people this system makes sense and two, fund research into ways to make the lie that this system makes sense more believable. This has been going on for decades and these people should be [REDACTED]
Yes but you see, Russia wanted to destroy America from the inside, while the ultrawealthy fascist authoritarians wanted to rape and pillage the nation for everything its worth while Russia was destroying it, so, y'know, from that perspective it makes a perfect, if perverted, sense.
There was a study by politico that indicated Trump supporters were willing to lose approximately $65 a month for Trump. I think they see increasing personal debt as something of a Trump tithing. They are already conditioned to tithe through church. So I don’t think they understand that they are losing much more than $65 or they just don’t care. It’s possible they are ok with becoming really poor if it makes people they dislike even poorer.
I hope they're all bankrupted financially by their moral bankruptcy.
It sucks to live through but these people need to be horribly horribly horribly burned by the stove or we're never going to get out of this. We need them to learn that it's hot.
Why you and many others assume these dimwits are capable of perceiving a connection between their actions and consequences is beyond me. There is no Schadenfreude to be had here. These morons scuttled the ship and lit fire to the life rafts while we're still on board.
But some will. It just has to get Great Recession bad.
George W Bush managed to kill his party for 8 years and it would have been longer if Trump didn't come through with the Russian digital army behind him.
They will remember that guy that bankrupts them for a generation.
Right or wrong, many of the OG Trump voters were voters that Democrats lost in the 90s when Clinton didn't stop NAFTA or make sure it meant Rust Belt factory workers weren't just fucked.
Sadly, we need it to happen worse this time to have a shot at FDR2.
I hope that whenever the DOGE checks, tariff rebate checks or the "vote Republicans" $5000 are announced MAGA all take a break from their victory laps to buy big expensive new trucks and shit they can't afford.
are we finally starting to realize the stock market is not a reflection of how people are actually doing?!?! feels like i've been taking crazy pills since 2008
It's also wild seeing people cheering for a market collapse when their fellow middle class neighbors are invested in it with their 401ks.
It's not just rich people.
Fuck that, Americans vote to “own their neighbors” not for their best interests. Let the GOP rule this country with an Iron Fist, now we all see how that’s turning out for everyone…they control all parts of the government but blame everything on everyone else while simultaneously calling to be all powerful, all knowing and the only person for the job. I’m tired
Listen, we all know what happens to bubbles, they blow up, they shimmer, and they make people happy. Oh, to make a big one! I remember this one time in 2001, and again in 2008. Wow, what a blast.
We've all seen it, since the day of the first bubble.
Just a quick observation of my local real estate market. Noticed over the last 2 months, a decent amount of homes that sold in the last couple of years are up for sale again. Checked the county records on these and you can see the mortgage documentation, all of them are either loaded up on variable rate home equity loan or a variable rate mortgage.
I would recommend reading the report directly https://www.federalreserve.gov/publications/files/scf26.pdf They also have some interesting graphs available https://www.federalreserve.gov/econres/scfindex.htm
>The report noted that income gains were particularly strong with families aged 75 or older while tumbling 25% for those aged 35 to 44, which the Fed attributed to declines in capital gains income for that group.
I mean at a certain point we don't need to look at the data that has been showing the same trends for literally my entire life of things getting worse rapidly with intermittent spikes of appearing to get better in extremely limited sections of society. Ultimately, the conclusion I had when I was literally in high school, which I have only gotten more resolute in, is that the stock market is a fraudulent institution and should be abolished - exactly like slavery.
You know what makes sense? Using taxes and assistance programs to rebalance the real world lived experiences of people. We are allowing insatiable wants to outweigh easily met needs. To clarify, what I mean, is we are allowing an increasingly small number of peoples insatiable greed to outcompete the needs of increasingly many people. In other words, we could easily meet the needs of everyone while still allowing everyone - everyone - to have enough flexibility to fulfill some of their wants, which makes that fulfillment much more fulfilling. In other, other words, if we literally tax the fucking rich and stop making policies that amount to "the poor should actually be slaves", things would improve for literally everyone, including the wealthy.
All the extremely regarded political "strategists" who are in reality propagandists who serve no function in society besides making truth less truthful and making lies more believable deserve [REDACTED].
Boy howdy, I wouldn’t compare the stock market to chattel slavery even if my life depended on it. I get your point and agree with it. But that’s a terrible comparison. I don’t think even an economic depression will ever cause you the horrors of that system of literally buying and selling people like livestock.
I completely understand your post here, but I offer this: the stock market IS just as bad because while we're not physically buying and selling actual bodies, it reduces people to lines and values on a screen.
It removes all common sense in those having power over other people to make that LineGoUp. It completely disconnects the idea of a business sharing profits with the people who actually produce the work for those profits. And therefore people are still, in fact, treated either like cattle or like favored sons...you just don't see it becuase you're not in those offices and businesses getting treated like the cattle you are.
And then they take those profits from the stock arket and buy themselves some Senators to try and make us all so sick and impoverished we turn to eat each other.
4.2%. People are still working. If that changes, if wages not only continue to not keep up with inflation, but then begin to fall, look out below.
That’s a lot of “ifs”. I’m not sure that we can’t maintain this current status indefinitely, with the wealth gap swelling beyond the massive imbalance it is right now.
"For the three-year period ended 2025, the portion of families behind on loan payments soared from about 12% in the prior survey to nearly 20%, according to a Fed survey released Friday."
Ultimately, the United States is trapped by its status as a reserve currency and the debt is merely a reflection of indefensible policy choices that betrayed its own citizens. Today, Wall Street cannot credible invest in American manufacturing, but when your only export is a financial system (banking/insurance) and a global currency, you will quickly degrade as you lose the manufacturing soveriegnty and food production. A switch to a universal currency based on infinite banks supported on a mathematically sound system like the divergent sequence is a path forward. It would still require a globalized Gini Index of roughly 5-1 with some elasticity. This would allow nations and even cities or locales to reclaim their sovereignty while individuals would have enough dignity and resources to self-actualize and maintain personal agency.
People are taking on more debt for necessities. People have drained their reserves to afford the drastic increase in fuel, groceries, healthcare, and housing. Things like car repairs that might have been paid with cash before are being moved to credit.
jayfeather31 | 21 hours ago
Considering that it feels like I've been gaslit on the economy for years, and have been waiting for the other shoe to finally drop when reality finally catches up to the investors, my only reaction here is a, "Yeah no shit."
bselite | 21 hours ago
Yeah, I know a lot of people personally who have so much credit card debt it's essentially inevitable that at some point they won't be able to pay the minimum on all their cards. Credit card companies gave out a lot of large limits on cards from around 2018-2023 and now people have maxed those out with lifestyle creep and inflation.
I think instead of a housing crisis we are going to have a personal debt crisis that in combination with inflation wrecks large portions of the economy.
CandylandRepublic | 15 hours ago
> so much credit card debt it's essentially inevitable that at some point they won't be able to pay the minimum on all their cards
Rather, at some point the total credit card debt will spook the banks, they cut peoples' limits, and put the outstanding debt above the new limit due. Then you have a month to pay it off when you can barely make minimums, and that's gonna go exactly as well as it sounds.
Usually happens at the start of a recession when people on average also lose their income. We've seen 2007 how that works out.
BenAdaephonDelat | 18 hours ago
Yep. In our case, it was literally just multiple unplanned high costs within a short span of time. Our son was in the ER for 5 days, we had a costly repair on our car and on the house. We actually signed up with a non-profit debt relief program to help us because it was already out of control.
dogs_gt_cats | 3 hours ago
> Yep. In our case, it was literally just multiple unplanned high costs within a short span of time.
On /r/investing there are so many people who think that credit card = emergency fund. Any talk about an emergency fund gets laughed down because, "those funds should be invested and you can just sell stock to pay for emergencies". I keep trying to impress on those newbie investors that that plan doesn't work when you suddenly lose your job because the market went belly up. Your investments? They're worth a fraction of what they were because the market went belly up, so any selling you do maximizes losses. The credit card thing falls over when you suddenly can't afford to make those payments.
I regularly told that I am overly conservative because I keep an emergency fund equal to one month of bills, then a "deep" emergency fund in short term treasury bonds (SGOV) equal to 6 months of bills. Those funds barely stay above inflation, but that's the price I pay for making sure I can weather storms that life throws at me. The opportunity cost is basically the same as paying for insurance.
2 months ago we had two surprise car repairs each over $4k each, a medical issue (about $2k), and our HVAC dying all in a single month (about $3k). Didn't touch investments or the credit card. I was really, really thankful for those emergency funds.
BenAdaephonDelat | 3 hours ago
Yea, this is going to be our plan going forward. The biggest mistake we made was just that when those sudden expenses went onto the card, we didn't immediately stop using them until we'd paid them down. Instead, we kept using them for our regular stuff (we had all our bills going on them and paid them off every month previously for the points). But then they just kept accruing interest and we kept throwing more on top and THEN I lost my job. So we were fucked.
But, live and learn. We're not gonna make that mistake again.
dogs_gt_cats | 2 hours ago
I'm sorry your family went through that, but the school of hard knocks is a fantastic teacher. Hard times also teach you a lot more about your risk tolerance and financial strategies than good times.
BenAdaephonDelat | 2 hours ago
Main take away is that we're going to do everything we can to be debt free in 5 years. Pay off the cards, pay off the solar panels, then sell the house (assuming the market ever recovers) to get back our equity, then buy something with cash in a lower cost of living city. We have decent equity in the house (we sold our previous home and did a large down payment) and it's a flat-rate 6% mortgage so. If we can just get the credit cards paid off we'll be in okay shape for a while.
dogs_gt_cats | 2 hours ago
The credit card thing is a huge one. What I ended up doing to help was quite literally freezing my credit cards (as in, put them in a solo cup, fill it with water, and put it in the freezer) and pay cash for everything for awhile. They were there if we truly needed them, but after awhile the "ease" factor they provide kind of goes away.
My wife and I also had cash allowances ($10/day per person). No other spending was allowed. For us, incidental spending with the credit cards was a big thing. No one thinks about the $3 here, $5 there type charges (although these days they're more like $15 here, $40 there).
Once we got used to using cash, we started relaxing on the credit cards, and the spending on them was overall better. It still creeps up from time to time.
BenAdaephonDelat | 2 hours ago
We're probably gonna be losing most of the accounts anyway as part of the debt program. (It's one of those ones where they negotiate with the lender to lower the interest rate while freezing the account). It's either that or bankruptcy so. But yea we're basically only using the credit cards for gas (because it's not safe to use debit for gas). But we've moved everything else over to cash for now until we get the balances down.
dust4ngel | an hour ago
> credit card = emergency fund
they call it that because it produces an emergency
AZdesertpir8 | 20 hours ago
Yep, this is unfortunately very common in American society today and I see it everywhere now. Its almost a necessity that one has the latest shiny thing, drives the latest model car, and dresses to impress, regardless of their actual financial standing. People need to learn to be content with what they have... its going to be a rough lesson for a lot of folks unfortunately. The credit card rates today are insane and a complete trap. Can't imagine holding revolving debt right now.
redaemon | 20 hours ago
People are suckers for advertising, especially on social media.
Adultery | 19 hours ago
This website is mostly consumerism and porn
Alt4816 | 19 hours ago
This website is a pick your own experience kind of website. People get to choose what subreddits they go to.
redaemon | 19 hours ago
I got adblock and haven't been shown any NSFW subs.
Sadly my comments are being farmed for AI training data, which is why the lateral micro-fluctuation of the ambient framework requires immediate pre-calibration to optimize optimal throughput
Adultery | 19 hours ago
They’re not NSFW anymore. The “Popular” tab is full of cartoon/anime porn and celeb cleavage. The other content is usually gossip or drama porn. Every other hobby sub is mostly consumerism porn.
Rohwupet | 19 hours ago
Yeah dude I'm sure that's it. Not the fact that minimum wage hasn't gone up since 2009 but inflation has increased to the point where a $15 MW now would be nearly equivalent to 7.25 then.
But yeah, it's cuz iphones, or whatever your boomer ass is rambling about.
https://i.imgur.com/0VAg7r8.jpeg
AssCrackBanditHunter | 19 hours ago
Low pay + a culture of spending with no safeguards may both be true and, in fact, together, enhance the damage.
roadrunnuh | 19 hours ago
Does the minimum wage issue make so many guys on building sites I work on buy 100k dollar trucks? It can be a combination of things, which most economic problems are.
Ringadingasoad | 17 hours ago
lol they are going to be really mad when you touch their little Tonka trucks. I used to point this out to those retards when I worked coal handling and it was like talking to people straight out of idiocracy. This one guy had a 2 hour commute daily to his jobs and he said he needs a truck for work. The truck wasn’t used for his job at all lmfao. He just thought he needed to look the part of a “blue collar worker”.
roadrunnuh | 4 hours ago
I try and keep my feelings down about all the clean, sparkling, empty bedded trucks that aggressively pass me on the freeway. Just me and my little Astro van, on my way to do actual commercial plumbing, ha
lflippz | 9 hours ago
We can say the minimum wage has not increased but you can still acknowledge consumerism is at an all time high. Amazon deliveries everyday, expensive unnecessary gas guzzling trucks, etc. People got a taste of spending power with their checks from covid and it never really let up. The Europeans I know tell me it’s like Americans were bred to consume.
Waco_Warner | 9 hours ago
Americans literally are bred to consume. Accumulating wealth is thought of as the number 1 highest pursuit. We are told from infancy that our main goal should be a high paying job. Sure people may have other goals and wants in life. But top down, that is what we are told to achieve.
0o0o0o0o0o0z | 7 hours ago
> Americans literally are bred to consume.
Yup... that's why the owner class can get away with so much, because the average Joe thinks he'll be a millionaire someday.
AZdesertpir8 | 4 hours ago
And until then, average Joe pretends to be a millionaire. Fake it till you make it!
Famous_Owl_840 | 8 hours ago
Sort of.
I’ve basically given up on buying things local. Even big stuff like building materials and appliances. Stores do not carry inventory.
I went to buy a deep freezer. Checked the website first - said it was in stock. I go to the store….it wasn’t. Close equivalent models were also OOS.
Ok - how long to order it? Not sure - maybe 2 weeks. Maybe 30 days. Manufacturer has been having trouble (aka boats from China delayed).
I sucks. I would like to buy local - but after all the wasted time and effort on my part - it’s a hell of a lot easier and efficient to click a few buttons on a screen and have the thing delivered to my front door.
weatherwar | 20 hours ago
This has been true for half a century. None of that is new.
AZdesertpir8 | 19 hours ago
Yep, but easy credit is the new factor in the equation. Debt is a very easy trap to fall into these days.
0o0o0o0o0o0z | 7 hours ago
And they've gamified stock trading and payday loans...
1234nameuser | 10 hours ago
Fact: disposable incone has been declining for years for bottom 80%
You're talking about the top 10%, and yes, US showers them with tax breaks
Constant_Tomorrow_69 | 16 hours ago
It’s not just the personal debt or the government debt, either. The AI debt is also utterly absurd, and it is like that clip of the 3 Stooges where they pass a bill around between them bc they each owe each other money and then there’s just confusion
IllustratorMurky2725 | 8 hours ago
And the insane interest these companies are allowed to charge on these credit cards
ImanAstrophysicist | 6 hours ago
Yet another thing the orange diaper don promised he would force them to limit to 19%, and then forgot about it the next day.
AZdesertpir8 | 4 hours ago
Yep, back when I carried some credit card debt (young and dumb), it was around 9%. Now, its 25-29%. Can't imagine carrying revolving debt right now. It is an absolute trap for anyone that gets stuck in it.
SuperNewk | 2 hours ago
Bingo you just solved the problem. Have the govt cap it at 10% max =
The min payment problem is delayed
Winter_Swan5104 | 12 hours ago
Credit card companies also changed the terms willy nilly on many of those cards.
seventysevensevens | 8 hours ago
I'm not a big fish, under 6 figure income my whole life, but I remember when I was unemployed and I got 2 credit limit increases in 2016-2018. Now that I'm employed, promotions, raises, no credit increase in quite some time.
AZdesertpir8 | 4 hours ago
Yep, the credit card companies know its a trap and work it to keep consumers paying that interest.
turko127 | 6 hours ago
Could this be something that creates longer term damage? Say prices do go down but people are so saddled with debt that they’re primarily paying it off first before spending?
ImanAstrophysicist | 6 hours ago
And just when their minimum payments become unmanageable, those banks will know it, and will jack up the interest rates to 28% because they are now ‘risky’, and it is a death spiral from then on!
Whaddduptho | 8 hours ago
> I know a lot of people personally who have so much credit card debt
That says more about who you hangout with than anything. The median credit card debt per holder is not high, and the median balance is half of the mean balance.
maplecremecookie | 20 hours ago
Yeah but how are the companies ever going to collect on the debt? If the person doesn't own their own home, the only thing of value they might own is a vehicle. I guess their phone, furniture, and appliances could get repo'd but they aren't going to sell for that much.
penquil | 17 hours ago
Credit card companies can't repo your personal belongings. Best they could do is sue you and garnish your wages if the judge agrees.
dually | 10 hours ago
The only reality that matters right now is the fact that AI companies are pumping $50billion per month in new data center construction in to the economy. The fact that inflation has only been around 3% is amazing.
DeathSpiral321 | 9 hours ago
Inflation can always be 3% if you doctor the numbers. If they measured it accurately it would be well over 10%.
reallybigshark | 8 hours ago
They exclude the things with the most volatile prices.
matjoeman | 5 hours ago
If you exclude the most significant expenses the numbers won't mean much.
Busterlimes | 21 hours ago
For all intense and purposes we have been in a recession since COVID Because we havent hit replacement numbers in the Job market since Obama. The government has always manipulated inflation data to distract from the fact that fiat currencies suck ass
OddlyFactual1512 | 20 hours ago
Intents
AVeryHeavyBurtation | 19 hours ago
Camping is in tents.
OddlyFactual1512 | 15 hours ago
Climbers do it in tents
OddlyFactual1512 | 19 hours ago
But, is it intense
Oryzae | 17 hours ago
Sure but you’ll be in tense when there’s some bears near them camp sites
shoot_first | 10 hours ago
Intensive porpoises
Humble-Heart-5302 | 8 hours ago
that's not what a recession is
ObispoBispo | 20 hours ago
I would give you gold, but alas, I have none.
Moby_Dick_Cheney | 20 hours ago
Put it on your credit card dude.
richsonreddit | 7 hours ago
What do you invest in / where do you keep your money with this belief, out of interest?
TimSylvester_ | 3 hours ago
The economy tried to correct itself in 2008 but it would have left a ton of wealthy people somewhat less wealthy, so extraordinary measures were taken to prevent that from happening - and in doing so, only made the problem worse.
If you fail to treat cancer, what happens? Does it fix itself? Or does it eventually kill the entire creature in trying to "save" the thing that caused the problem?
Unfortunately this "cancer" can just move itself to another nation once this nation has died in service of preserving the cancer.
Mackshac | 19 hours ago
Wait i was told i make 20-30% every year on my investments??? And it will never drop just like housing it only goes up 200k per year??
I was lied to?
khay3088 | 18 hours ago
I was pretty sure in 2016 that house prices were crazy and we were clearly in a bubble lol. Incredibly lucky we had already bought and were able to ride the wave
Maxpowr9 | 20 hours ago
To keep playing that broken record, commercial borrowing costs are what will sink the economy. You have rates that will reset to more than double from Q1 2022 and their businesses are not growing at 6%+. That will lead to layoffs across the board.
weatherwar | 19 hours ago
You do understand that just because a loan is refinanced at higher rates, your growth doesn't have to match that rate, right? The interest payments cut into margin, but it's not like all the sudden I'm not making any money if I'm growing at 6% and have a loan at 6%.
Maxpowr9 | 19 hours ago
Your COGS balloons as well, as other businesses that supply yours passes on said costs. If you're in growth mode, said higher rates are tolerable. If you're in a stable state, it's devastating. Why minimum shipment order requirements are also skyrocketing leading to inventory issues.
kent_eh | 8 hours ago
> That will lead to layoffs across the board.
Will that be what it takes to get people off their asses and out in the streets with torches and pitchforks (either figurative or literal ones)?
amendment64 | 7 hours ago
Not a chance, this is America. At that point, Dems will be in charge, they will have no way of stopping or slowing it down, people will vote in repubs again, rinse and repeat American social conservatism will be adopted harder than ever; economically we'll be poorer than ever(except the oligarchs of course, they'll have everything!)
kent_eh | 5 hours ago
> people will vote in repubs again
Which is why I keep telling Americans that "everything will not go back to normal" when/if they dump Trump.
It'll take a decade or more of consistent good behaviour before anyone will think about maybe starting to trust American a bit.
jarena009 | 21 hours ago
I would suggest renewing the tax rates we had in the 90's on the top 2-3%, along with the corporate tax rate from the 90's applied to corporate income above $1B, and tax long term capital gains above $0.5M as ordinary income. We'd slash the deficit in half. The Wealthy and Corporations will continue to do very well.
Plus without significant efforts to rein in healthcare costs, we're doomed, not just on the federal budget but in general. They too run up federal spending.
Straight-Ad6926 | 21 hours ago
The 90s revenue model definitely brought in serious cash but good luck getting any politician to sign off on higher capital gains taxes without them warning that the stock market will instantly implode.
OK_x86 | 21 hours ago
Given how overvalued the average stock is this might actually be a blessing
BustedBaxter | 20 hours ago
with the advent of the 401k as primary retirement vehicles, I don't see how that could be the case
OK_x86 | 19 hours ago
Resting the retirements of Americans on a house of cards was never a great idea. But ideally everyone is diversified enough to mitigate that
1900grs | 12 hours ago
> But ideally everyone is diversified enough to mitigate that
It's the same level of diversification now as 2007. Expect similar results.
OK_x86 | 11 hours ago
Caveat emptor
TootCannon | 20 hours ago
By what measure is the average stock currently overvalued?
Cheap-Explanation293 | 20 hours ago
P/E ratio for certain companies
TootCannon | 19 hours ago
What is "certain companies?" They said "average stock." The trailing P/E of the S&P is 25. The forward P/E is 21. The historical average since 1989 is 18. It's above average, sure, but not by a crazy amount. And most of the highest P/E is consolidated in a few tech companies. When you take those out, the "average stock" of the S&P falls even lower.
Cheap-Explanation293 | 18 hours ago
And most of the stock market growth are from those same overvalued tech companies.
Tesla is the most egregious case, but there are others. Especially when you go diving into some of these AI companies.
TootCannon | 18 hours ago
That's the point, though. If all the growth and most of the high P/E is in a very small minority of tech stocks, then the rest of the market, a majority, is arguably undervalued. Indeed, a lot of the market is down substantially this year. It's a great time to buy "average stock."
OK_x86 | 11 hours ago
The stocks are a minority but those stocks represent a significant chunk of the total capital allocated to the market.
About half of all market cap is in US exchanges and 80% is in the S&P500. The top 10 companies in that index alone represent about 40% of the total market cap.
kent_eh | 7 hours ago
> but good luck getting any politician to sign off on higher capital gains taxes
Especially when those same politicians are profiting more from those gains (emoluments clause be damned) than they are from their actual salaries.
jarena009 | 21 hours ago
Why would the stock market implode?
Wurm42 | 21 hours ago
It won't. Well, not because of closing capital gains tax loopholes.
Wall Street always claims that any changes that result in Wall Street executives paying more taxes will crash the stock market.
For self-proclaimed "Masters Of The Universe," they're whiny little bitches.
jarena009 | 21 hours ago
It makes no sense if you think about anyone taking capital gains distributions regularly. Say you're taking $1M in long term capital gains distributions as your income annually. First for context, you would need to have at least $10M invested, and likely more to pull off that kind of distribution. (more likely, you have $20-25M at least invested). So, this hypothetical person is already silly/insane rich to be able to do this.
- Under current law, that person pays $176K in federal income taxes
- Under my proposed law, that person pays $233-$250k in federal income taxes
The idea that the stock market is going to crash over a 6-7% change in effective tax rate is a joke. You're still taking home $750K in after tax income (okay to be fair, with state taxes, might be more like $650-700k, but still! And more importantly, where is this person putting their money if they take it OUT of stocks?
Open_Pollution_8038 | 21 hours ago
And what if they have losses?
Oryzae | 17 hours ago
Then ya don’t pay any fuckin taxes on it mate
NeverVegan | 21 hours ago
All the billionaires will leave NYC if Mamdani gets elected!!!! /s
liftthatta1l | 19 hours ago
Any and all possible disruption to the cash flow will make it implode, we must whopship and not disruption the dragon's horde such that some select few can take from it while others all starve or burn in the dragon's fire.
DrakenViator | 21 hours ago
People cashing out before the tax increase, or at least that is the fear
jarena009 | 21 hours ago
Cashing out mass unrealized gains and then putting their money where? Into nothing?
love_junkie911 | 7 hours ago
Small graduated increases applied via a schedule. The hardest part about taxing wealth is political will, not logistics.
Open_Pollution_8038 | 21 hours ago
Increasing capital gains tax blanket is a terrible idea and it’s been tried and failed in every country on the planet.
Straight-Ad6926 | 20 hours ago
That's a pretty wild exaggeration. The Tax Reform Act of 1986 taxed long term capital gains at 28% like ordinary income, coinciding with economic and stock market growth. OECD nations like Denmark, Finland, Ireland, and France apply higher rates without market collapse.
Open_Pollution_8038 | 20 hours ago
They lowered the top ordinary rate from 58% to 28%, they increased the capital gains from 20% to 28% as a pay for. The resulting increase in capital gains tax caused a widespread market sell off as everyone sold to buy at lower taxes.
Do you really want to compare how the U.S. growth stacks against large European countries?
jarena009 | 20 hours ago
Stocks in the long term grew though just fine in the US...and you yourself admitted they reinvested back into the stock market. A short term market sell off would be worth it long term.
Also, who did they sell their stocks to?
Open_Pollution_8038 | 20 hours ago
Bonds? Why risk my capital for 70% of the gain here I could just buy bonds
ihopuhopwehop | 20 hours ago
And why is that a problem? One of the big issues we're facing right now is the reduced interest in bonds driving up yields
Open_Pollution_8038 | 20 hours ago
It hinders start up businesses as it deprives them of capital.
ihopuhopwehop | 20 hours ago
No it doesn't...more money flowing into bonds drives down bond costs which translates to lower borrowing costs for all us, whether we're taking out mortgages, auto loans, or small business loans
jarena009 | 20 hours ago
Bonds are taxed as capital gains too.
Also your idea makes no sense. Are you taking distributions annually on long term gains, above $0.5M? If you're making, say $1M annually in long term capital gains annually, that means you must have $15-25M invested, and even more wealthy to be able to pull that off.
And meanwhile, your tax liability on $1M in long term capital gains goes from $176K in federal taxes to $233-$250k under my proposal.
You're slashing your potential gains in half, from $1M to $0.5M by taking money out of stock and putting them in bonds, over an effective tax rates going up for you by $60K? LOL.
Congrats, you just passed on $500k to save $60K in taxes, lol.
Open_Pollution_8038 | 20 hours ago
Bonds are not taxed as capital gains, they’re taxed as ordinary income via interest payments. lol it’s basic fucking taxation of bonds.
Sure you could buy and sell bonds to realize capital gains but it defeats the entire purpose of buying a bond.
jarena009 | 20 hours ago
Soo your point is your moving into an asset class that yields considerably less, that's also taxed as ordinary income?
And you're taking annual distributions above $500K on that?
Straight-Ad6926 | 20 hours ago
Yes people shifted timing to save on taxes in 1986. But did they stop investing in the US afterwards? No because making 70% of a massive profit still beats making 100% of nothing sitting on cash.
Open_Pollution_8038 | 20 hours ago
You would buy bonds instead.
ihopuhopwehop | 20 hours ago
When a wealth tax gets brought up we hear about all the capital gains that the wealthy are sitting on. Well if thats the case then why does it matter if capital gains get taxed at a higher rate?
When i look at my holdings, a 10% increase in capital gains would make me hold stocks in probably looking to sell once they reach the ltcg threshold...
Open_Pollution_8038 | 20 hours ago
They’re sitting on their investments, isn’t that what we want? For people to hold investments in their businesses over a long period of time?
ihopuhopwehop | 20 hours ago
A higher capital gains would make further incentivize holding
Sherm | 18 hours ago
The 90s tax rate was also paired with huge cuts to the defense budget (the "peace dividend.") The spending cuts were also a big part of the success.
jarena009 | 18 hours ago
We should cut the defense budget too, stop these failed quagmires in the mid east, including the current illegal war.
peekdasneaks | 14 hours ago
Money can be spent, received, created, or destroyed.
Only the us government has the ability to do all 4. When it does any one of these 4, there is always a paired action.
When it spends, it creates money to spend.
When it receives, it destroys money that is received.
Money (created by the federal reserve) itself is the liability on the balance sheet that drives the "deficit" that everyone is so concerned about.
The money in your bank account is the "us debt"
If you really want to get rid of the debt and reset it to zero, that would mean returning all of the monet in circulation back to the government for it to destroy, zeroing out its balance sheet.
When you hear politicians talking about the federal deficit, it is just that, the deficit of the federal bank.
Because cash in circulation for them is a liability
Think about that. Your money is their liability, and they have the populace so warped into thinking the deficit is their own personal debt when its literally the exact opposite.
Where did all this money come from you may ask? Why is the deficit growing?
Because our economy is growing. Were all producing more value as a while so more money needs to be printed to support that value. That directly increases the "deficit"
This talk of the us debt is insanity at its finest.
some_where_else | 12 hours ago
Actually in a modern fiat economy (like the US), money is created by banks when they originate loans. And is destroyed when said loans are repaid.
garfieldsez | 20 hours ago
My insurance is going up $100; deductible went up $600! We are getting taken for a ride. It’s gross out there.
jarena009 | 20 hours ago
Yes, and I presume that $100 is just the premium? The reality is the average PPO cost for a family plan just on the premium alone is at $28,000 as of 2025 according to Kaiser (probably closer to $29-30k in 2026, and is expected to rise like 7-8% next year. In 6 years that becomes $40,000 for a family, in 10 years, $50,000. It's insane.
And again, that's just the premiums excluding out of pocket.
I honestly think something is going to have to break, and I'm not suggesting any pitchforks and torches, but we're seriously going to have to just reject paying for insurance, and just go straight to the doctor; and for employer insurance, ask employers to simply fund savings accounts with the cost of what they were paying for insurance - just sent the money to us instead!
Boring-Tie-1501 | 16 hours ago
I think we're not too far away from guillotines.
I t's just going to take a push, and trump has been destabilizing the global trade system so much that a massive correction seems inevitable.
psychohistorian8 | 9 hours ago
not so sure about that. where is the revolution in NK, Russia, etc?
seems pretty clear to me that people will just endure suffering indefinitely and try to get along as best they can while the rich continue to get richer
garfieldsez | 20 hours ago
Ok that’s a brilliant idea. Harder after judge annulled that Biden health debt rule in 2025.
ShiftNo4982 | 17 hours ago
Are you unaware how much surgery or cancer treatment costs?
The__Amorphous | 10 hours ago
Just gets denied by insurance anyway.
ShiftNo4982 | 9 hours ago
lol whatever you say bud
kingkeelay | 19 hours ago
Or they can just pay more wages. It’s all just numbers. No reason for people to have access to cash that should be reserved for health care emergencies.
jarena009 | 19 hours ago
That's what I'm getting after. If my employer is paying $22K toward a $30K health plan, which is just the insurance premium, I'd rather they just give me the $22K as income, and then I also don't deduct $8k from my paycheck, and I have $30K extra saved per year. Don't buy the plan, just provide the $22K, and don't deduct anything from my paycheck.
kingkeelay | 9 hours ago
We don’t trust you to save it for a healthcare emergency. The answer is single payer insurance not tied to an employer. Medicare for all.
jarena009 | 8 hours ago
That's the ideal solution. But given politicians are in bed with insurance companies, I propose we revolt (refuse to purchase insurance) against them.
The politicians aren't going to just get us to single payer; we'll have to force them to.
kingkeelay | 7 hours ago
We already did that by bankrupting local hospitals and forcing state and local governments to bail them out. If you don’t mind me asking, what is your age?
jarena009 | 5 hours ago
We're not getting a political solution willingly. 43
existenceawareness | 18 hours ago
You're shocked at max $1,800/year healthcare costs? Can you share with us where to find the best insurance in the country?
I've touted before that ACA is decent because my $300 premium $10,000 deductible is reduced to $100 premium with subsidies. 100/600 is bananas these days.
garfieldsez | 6 hours ago
Bru this is work insurance! Corporate job.
Family EPO plan is now $1080/mo pretax for a $1000 deductible.
OwnConversation1010 | 20 hours ago
Let’s return to Eisenhower’s rates.
onlinewarrior100 | 12 hours ago
This comment needs to be at the top
walkingthecowww | 19 hours ago
Do you have a source that this would cut the deficit in half or is that just something you made up?
Accidental-Genius | 21 hours ago
The spending has to be reigned in too.
jarena009 | 21 hours ago
Much of it is tied to healthcare. What would you like to cut? The vast majority of federal spending, outside interest on debt, is the military, medicare, medicaid, veteran's care, "income security" (e.g. child tax credits, earned income tax credits), to name the main ones which contribute to the deficit; Social Security by the way adds practically nothing to the deficit by law, aside from transaction or the cost of processing bond sales, when bonds from the trust fund need to be purchased, rolled over, or sold.
We need to treat healthcare like the crisis that it is. The average PPO plan for a family in the US costs $28,000 as of last year, and in 6 years that'll be $40,000, and in 10 years nearly $50,000, and that's JUST the premiums, excluding out of pocket. This is not sustainable. And "slowing the rate of increases" isn't going to be enough, no we need a 5-10% reduction asap, and then kept flat for a number of years.
OddlyFactual1512 | 20 hours ago
You don't cut the care, you cut the profit. If the US paid the same per capita for healthcare as the next most expensive nation, the nation would save nearly as much as the current federal deficit. Make it the average of all similar nations, and it is over 150% of the current deficit. A big reason our debt is so high is the failure to do what ever other developed nation has. You can guess what that is.
Test-NetConnection | 21 hours ago
Universal, single-payer healthcare fixes all of this. Eliminate the profiteering middle-men while reigning in the cost of drugs and medical procedures. Pay for it with a direct tax that is a third of what most people pay private insurance companies.
jarena009 | 21 hours ago
That would be a strong deficit reduction measure, and everyone is covered too. Also, not sure why my comment pointing out the futility of just cutting the budget, and the need for serious healthcare reform, is being downvoted.
dreww84 | 20 hours ago
Sadly, the same thing would happen that happened to Obamacare: a few people paying an absolute fortune to subsidize the many low income people and the whole thing collapses.
ihopuhopwehop | 20 hours ago
A single payer Healthcare system, not medicare for all, would allow for significant alterations in incentives that would drive down costs
Accidental-Genius | 16 hours ago
I’m fine with cutting all of that actually.
The boomers got us into this mess, they can give up their meds to get us out of it. Problem solved.
CosmicQuantum42 | 21 hours ago
“Like to cut” is not an option. Cuts will happen. Period. It’s just a question of what.
There is no amount of taxing upper earners and the rich that will save the country from the mess it has voted itself into.
jarena009 | 21 hours ago
I don't think you realize how much money the upper earners, wealthy, corporations actually have, and how easily we could slash the deficit in half just on taxing them at reasonable levels alone....levels we've seen historically. At present, we tax maybe 16% of GDP. Taxing 19.5% brings in $800-900B. Increased IRS enforcement of tax cheats, another $70-100B.
Serious healthcare reform can slash the deficit even further.
So again, what spending are you cutting?
CosmicQuantum42 | 21 hours ago
I don’t think you realize how ineffective and counterproductive these actions you are contemplating will be. They will not happen.
As far as cuts, who knows. My opinions aren’t relevant. Choices will be made, because there will not be options otherwise.
jarena009 | 21 hours ago
You can revisit the 90's when we had similar tax rates as a % of GDP, and a lower deficit, plus you should look at how gutting people's healthcare and retirement will be ineffective and counterproductive (plus will literally kill people).
Choices will definitely need to be made. Mortal ones.
The idea that there's not enough money to be taxed is a joke. Are you aware of what level of corporate profits in the US we're at, and how much income and wealth is captured and concentrated at the top. To tax $800B would be a blip on the radar for them.
You still haven't answered what would you like to cut?
Accidental-Genius | 16 hours ago
It still won’t matter. We have to tax and slash spending, cutting a deficit in half still leaves a deficit.
rampantcloudydays | 12 hours ago
The wealthy must be bled dry from their ill-gotten gains. There is literally not a single wealthy person doing good on Earth at the moment. No one who has wealth today should have it tomorrow. We need a new meta.
ShitDollop | 9 hours ago
Lmao
Accidental-Genius | 9 hours ago
McKenzie Scott.
Now define wealthy?
-XanderCrews- | 21 hours ago
I thought doge did that already.
Clitaurius | 18 hours ago
Slashing the deficit in half via these measures is a ridiculously low bar to aim for, especially since next year congress could just triple the military budget to make up for this slash and get us right back to where we were.
Or did you mean the debt?
ExistentialCrisis227 | 19 hours ago
The eisenhower tax rates were not paid in full in practice, and capital was not mobile then. Take Canada for example, it has far lower taxes than the eisenhower taxes, and still around 40% of the top 1% of wage earners, and 30-50% of the next 9 percent have left the country, largely to the united states. Half of all start ups that raise a million leave. And about a trillion in capital flight has taken place.
Then look at Sweden. Sweden has more billionaires per capita than the united states, and it is hardly a shithole. It is infact the opposite, a cradle to the grave welfare state. The swedish left and right worked together in the 90s, and 00s to revamp the tax structure abolishing wealth, and estate tax, giving prefrential treatment to holding companies, and activiely managed companies, set prefrential rates for capital gains, and instead tax the middle classes more, through much higher progressive income tax and a VAT of up to 25%. No nation can decide if there is wealth in the world, they can only decide if they are a wealthy nation.
manyManyLinesOfCode | 18 hours ago
sweden is not good example, there are same debates to increase taxes on capital here as people are unhappy and everything got worse for working/middle class.
It it just better than USA because it started to get worse from better point, so it is not that bad yet (doubt it will ever be, but still).
so while it is not shithole by any means, it feels like one compared to 10-20 years ago
ExistentialCrisis227 | 18 hours ago
By global standards sweden is a paradise, and if swedes dont think themselves blessed to be in the country, they are spoiled and sheltered beyond belief. Even by western standards sweden is a near dream. It has endured under the strain of mass migration and its problems better than some of its comparison countries, and certainly better in general to Finland, that is rapidly nearing dangerous territory. The former finance minister Kjell-Olof Feldt was vocal in the past that the social democrats had wanted the impossible, successful wealthy companies, but for their owners and shareholders not to share in that success and wealth. And that it was important for the social democrats to accept that thriving and growing companies also mean the increase in the wealth and income of the owners of these companies, and that these consequences are infact a central motivation for people to found companies and take on entroprenual risk.
CtrlAltSysRq | 16 hours ago
It really needs a cap though. All people do with more than like 20 million dollars at this point is overthrow democracy.
If billionaires just built monuments and giant ass churches and maybe some weird houses this would be a different discussion.
ExistentialCrisis227 | 16 hours ago
What cap on wealth do you want? Certain companies will never be formed, or more likely never be formed in a specific country if they effectively cap wealth at 20m dollars. Once you hit the comapny, sell it to foreign capital, and retire, or move the company overseas. If there is a wealth tax, then like canada and denmark, the companies move early, to avoid being stuck. Denmark for example has lost 9 of its 13 unicorns despite educating world class talent, for this very reason, and the bleed from canada is all around massive. No nation can decide if there is wealth in the world, or wealthy entroprenuers, only if they live and operate in your country. Thats a bitter pill, I am aware.
CtrlAltSysRq | 6 hours ago
I honestly think that's better than the alternative which is letting Musk (et al) do what's currently happening. I also think it's better for the economy as a whole if there's a thousand smaller 20m dollar businesses than one Amazon.
ExistentialCrisis227 | 3 hours ago
I agree with both. And I personally think that if property is going to have rights, it needs to have responsibilities. I am all for mass confiscation of huge swaths or even all of the wealth of the ultra rich, if that money is used as a means to commit crimes, much like any other criminal can lose the property they commited crimes with.
manyManyLinesOfCode | 14 hours ago
if we want to stay blessed country things have to change ( apparently )
mpbh | 14 hours ago
This article is about consumer debt ... why are we talking about the national debt and taxing the rich?
KimJongAndIlFriends | 10 hours ago
Consumer debt doesn't just magically skyrocket because everyone collectively lost the ability to control themselves.
It increases by that much because the necessities stopped being cheap enough to afford without taking on that much debt, too.
mpbh | 10 hours ago
Yeah ... I understand... but what does the national debt and corporate tax rates have to do with that?
a_little_hazel_nuts | 21 hours ago
Starting a trade war using tariffs is a good way to destroy an economy. Giving gigantic tax breaks to the wealthiest is a good way to raise the deficit. Taking away government services that keep people safe and informed is a good way to hurt or kill people.
CertainCertainties | 21 hours ago
It's interesting that pretty much every multi-billionaire benefiting from this massive transfer of wealth to the uber-rich has a bolt hole planned.
That is, massive private estates on islands and in places outside mainland USA. New Zealand, the Scottish Highlands, and Pacific islands, as well as Switzerland, the Riviera and Tuscany.
Almost as though they know their actions will cause the breakdown of civil society in the US and they will be ready to leave when they have extracted all the wealth they can.
irrelevantusername24 | 14 hours ago
Well I mean they're basically stealing from every person on the planet at every moment of every day through surveillance capitalism via the Internet and via "stocks" and "crypto" and now "prediction markets" and the main thing they do with that ill gotten money is, one, fund messaging that convinces people this system makes sense and two, fund research into ways to make the lie that this system makes sense more believable. This has been going on for decades and these people should be [REDACTED]
TimSylvester_ | an hour ago
Yes but you see, Russia wanted to destroy America from the inside, while the ultrawealthy fascist authoritarians wanted to rape and pillage the nation for everything its worth while Russia was destroying it, so, y'know, from that perspective it makes a perfect, if perverted, sense.
Nifey-spoony | 21 hours ago
There was a study by politico that indicated Trump supporters were willing to lose approximately $65 a month for Trump. I think they see increasing personal debt as something of a Trump tithing. They are already conditioned to tithe through church. So I don’t think they understand that they are losing much more than $65 or they just don’t care. It’s possible they are ok with becoming really poor if it makes people they dislike even poorer.
alilhillbilly | 20 hours ago
Honestly, I love it.
I hope they're all bankrupted financially by their moral bankruptcy.
It sucks to live through but these people need to be horribly horribly horribly burned by the stove or we're never going to get out of this. We need them to learn that it's hot.
Jonoczall | 10 hours ago
Why you and many others assume these dimwits are capable of perceiving a connection between their actions and consequences is beyond me. There is no Schadenfreude to be had here. These morons scuttled the ship and lit fire to the life rafts while we're still on board.
alilhillbilly | 3 hours ago
The thing is, they won't. Not all of them.
But some will. It just has to get Great Recession bad.
George W Bush managed to kill his party for 8 years and it would have been longer if Trump didn't come through with the Russian digital army behind him.
They will remember that guy that bankrupts them for a generation.
Right or wrong, many of the OG Trump voters were voters that Democrats lost in the 90s when Clinton didn't stop NAFTA or make sure it meant Rust Belt factory workers weren't just fucked.
Sadly, we need it to happen worse this time to have a shot at FDR2.
MosquitoValentine_ | 20 hours ago
I hope that whenever the DOGE checks, tariff rebate checks or the "vote Republicans" $5000 are announced MAGA all take a break from their victory laps to buy big expensive new trucks and shit they can't afford.
SurrealEstate | 7 hours ago
> We need them to learn that it's hot.
Unless they continue to believe that the source of their suffering is whatever they're told.
A comfortable, simple, familiar fantasy becomes even more attractive as people become desperate.
kent_eh | 7 hours ago
> I hope they're all bankrupted financially by their moral bankruptcy.
Trouble is, there's enough of them that when they finally feel that "horrible burn", so will the rest of us who are being dragged along on the ride.
Empty_Football4183 | 21 hours ago
Blowing past $65 a month and that was months ago. Wait until yoy actually have to finance something large
MutedAstronaut9217 | 18 hours ago
are we finally starting to realize the stock market is not a reflection of how people are actually doing?!?! feels like i've been taking crazy pills since 2008
pokeDad88 | 8 hours ago
It is quite weird my retirement is doing great my week to week bank account is in the gutter. So if I make it to retirement I might be ok.
GWS2004 | 6 hours ago
Agreed.
It's also wild seeing people cheering for a market collapse when their fellow middle class neighbors are invested in it with their 401ks. It's not just rich people.
BlackberryHelpful676 | 6 hours ago
Except that retirement will immediately start getting eaten by your week-to-week the second you draw from it.
Electrical-Box-4845 | 5 hours ago
In printer we trust!
cyberdude419 | 21 hours ago
Fuck that, Americans vote to “own their neighbors” not for their best interests. Let the GOP rule this country with an Iron Fist, now we all see how that’s turning out for everyone…they control all parts of the government but blame everything on everyone else while simultaneously calling to be all powerful, all knowing and the only person for the job. I’m tired
kent_eh | 7 hours ago
>Fuck that, Americans vote to “own their neighbors”
As a neighbour to the Americans, I concur with your "fuck that".
They're not only hurting themselves. They're causing pain to all of us, even as we try to further insulate ourselves from the fire they are stoking.
B00marangTrotter | 21 hours ago
Listen, we all know what happens to bubbles, they blow up, they shimmer, and they make people happy. Oh, to make a big one! I remember this one time in 2001, and again in 2008. Wow, what a blast.
We've all seen it, since the day of the first bubble.
They float away.
/s
socialmedia-username | 20 hours ago
The great equalizer
aust_b | 21 hours ago
Just a quick observation of my local real estate market. Noticed over the last 2 months, a decent amount of homes that sold in the last couple of years are up for sale again. Checked the county records on these and you can see the mortgage documentation, all of them are either loaded up on variable rate home equity loan or a variable rate mortgage.
bikemandan | 17 hours ago
I would recommend reading the report directly https://www.federalreserve.gov/publications/files/scf26.pdf They also have some interesting graphs available https://www.federalreserve.gov/econres/scfindex.htm
irrelevantusername24 | 14 hours ago
>The report noted that income gains were particularly strong with families aged 75 or older while tumbling 25% for those aged 35 to 44, which the Fed attributed to declines in capital gains income for that group.
I mean at a certain point we don't need to look at the data that has been showing the same trends for literally my entire life of things getting worse rapidly with intermittent spikes of appearing to get better in extremely limited sections of society. Ultimately, the conclusion I had when I was literally in high school, which I have only gotten more resolute in, is that the stock market is a fraudulent institution and should be abolished - exactly like slavery.
You know what makes sense? Using taxes and assistance programs to rebalance the real world lived experiences of people. We are allowing insatiable wants to outweigh easily met needs. To clarify, what I mean, is we are allowing an increasingly small number of peoples insatiable greed to outcompete the needs of increasingly many people. In other words, we could easily meet the needs of everyone while still allowing everyone - everyone - to have enough flexibility to fulfill some of their wants, which makes that fulfillment much more fulfilling. In other, other words, if we literally tax the fucking rich and stop making policies that amount to "the poor should actually be slaves", things would improve for literally everyone, including the wealthy.
All the extremely regarded political "strategists" who are in reality propagandists who serve no function in society besides making truth less truthful and making lies more believable deserve [REDACTED].
acableperson | 8 hours ago
Boy howdy, I wouldn’t compare the stock market to chattel slavery even if my life depended on it. I get your point and agree with it. But that’s a terrible comparison. I don’t think even an economic depression will ever cause you the horrors of that system of literally buying and selling people like livestock.
artisanrox | 2 hours ago
I completely understand your post here, but I offer this: the stock market IS just as bad because while we're not physically buying and selling actual bodies, it reduces people to lines and values on a screen.
It removes all common sense in those having power over other people to make that LineGoUp. It completely disconnects the idea of a business sharing profits with the people who actually produce the work for those profits. And therefore people are still, in fact, treated either like cattle or like favored sons...you just don't see it becuase you're not in those offices and businesses getting treated like the cattle you are.
And then they take those profits from the stock arket and buy themselves some Senators to try and make us all so sick and impoverished we turn to eat each other.
082426grateful | 20 hours ago
4.2%. People are still working. If that changes, if wages not only continue to not keep up with inflation, but then begin to fall, look out below.
That’s a lot of “ifs”. I’m not sure that we can’t maintain this current status indefinitely, with the wealth gap swelling beyond the massive imbalance it is right now.
4.2%.
DJPho3nix | 19 hours ago
Ahh yes. The Great Recession. A supposed "once-in-a-lifetime" financial situation.
Here we are again for the second time in my adult life and I'm only 43...
mrflash818 | 4 hours ago
"For the three-year period ended 2025, the portion of families behind on loan payments soared from about 12% in the prior survey to nearly 20%, according to a Fed survey released Friday."
toresimonsen | 2 hours ago
Ultimately, the United States is trapped by its status as a reserve currency and the debt is merely a reflection of indefensible policy choices that betrayed its own citizens. Today, Wall Street cannot credible invest in American manufacturing, but when your only export is a financial system (banking/insurance) and a global currency, you will quickly degrade as you lose the manufacturing soveriegnty and food production. A switch to a universal currency based on infinite banks supported on a mathematically sound system like the divergent sequence is a path forward. It would still require a globalized Gini Index of roughly 5-1 with some elasticity. This would allow nations and even cities or locales to reclaim their sovereignty while individuals would have enough dignity and resources to self-actualize and maintain personal agency.
AZdesertpir8 | 20 hours ago
Gotta keep that excessive lifestyle going to impress the Joneses down the street! Just open another credit card!
I'm honestly not surprised. Many people have been living well beyond their means for quite some time and eventually they gotta pay the piper.
movzx | 18 hours ago
People are taking on more debt for necessities. People have drained their reserves to afford the drastic increase in fuel, groceries, healthcare, and housing. Things like car repairs that might have been paid with cash before are being moved to credit.
dually | 10 hours ago
humans have unlimited wants and needs which is why Reaganomics works