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Inequality and the top 10%

It's a bit like child poverty, which I've never understood, as a child is the responsibility of the parent(s). How do they glean these income figures? Via taxation? Surely not, as the richer you are, the more sophisticated (and shielded?) your financial affairs are.

Since leaving lower tier grammar school in '58, I flitted from job to job (as they grew on trees in those years) before entering teaching college at the age of 29. I then knew that I'd never be rich, barring a p.b. or lottery win. I've always adopted the mantra of 'it's not what you earn; it's what you spend'. I have never questioned my remuneration and have always been a saver; every little helps 'n' all that. Comfortable was the aim and I guess I've been lucky because that's what I felt two years ago when things were at least relatively consistent in the world.
 
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No, public spending is not responsible for poor living standards. It is possible to have the content living styles you speak of and properly funded public services. The fact that we do not is a political choice.

Have you spent much time in the US or worked with / know many US citizens? I’d suggest if you had, you’d realise how fortunate we are in the UK to actually have a safety net.
 
It really all boils down to what one considers an "ordinary" or "normal" or "middle class" lifestyle, income and property. For instance, would a person who has £1 million in property, £1 million in securities, and earns £60,000 a year be "ordinary" and "normal" in a developed country?
You need to employ a nanny to qualify.
 
https://www.vox.com/the-goods/22673605/upper-middle-class-meritocracy-matthew-stewart

This hits VERY close to home for me. I'm almost certainly in the top 10%, but still do not feel secure. I live a pretty modest life, but worry that my daughter will lead a life of poverty on account of her learning disabilities. I'm one of life's winners, but it sure doesn't feel like it, because the healthcare system and lack of social safety net means that financial advisers will tell you that a couple needs $2 million to have a secure retirement, and be able to pay their medical and care bills.

I live in a town that he describes - over parented, over-achieving kids, mostly headed to prestigious colleges, but as much as it's an achievement it's a necessity, because there is no longer a middle class, and failure to get a good degree means a high possibility of a life of financial vulnerability.

The book was written about the US, but I suspect it's pretty true for the UK (though you don't have our awful, parasitic healthcare system). Even if you are a winner, unless you're in the 1% and have no conscience and no kids you're not really a winner.

Ugh - how to fix it ? Clearly NOT voting Republican / Conservative is a necessary pre-requisite, but also clearly not sufficient.

Interesting article. We don't have as much of that culture here, though it does exist. Generally, society here is less hyper-competitive and less individualistic (and we don't have an American dream FWIW). Our capitalism is more tolerant and balanced - and more supportive. The NHS and capped university fees are good examples of that. Maybe this helps us relax a bit but in general people here are less live to work, more work to live which definitely helps us relax. Pubs also help. When I worked in the US, I was always struck by how many people's lives revolved around work. No one seemed particularly happy. Everyone seemed stressed. I suppose in the end it comes down to how you define success and whether you think you need to be in 9.99% to achieve it.
 
Have you spent much time in the US or worked with / know many US citizens? I’d suggest if you had, you’d realise how fortunate we are in the UK to actually have a safety net.
Apologies, I may have misread your post. On first reading it seemed you were saying that the restrictions on our available lifestyle was down to expenditure on public services, that there was some sort on necessary trade off between the two, I see now that you maybe meant that contentment was enabled by our public services.

If so, I agree entirely.

(But it should enable more people)
 
Estimated vaue of the black/shadow economy in the UK - around 2 trillion £ - 2 thousand billion £.
Who's cleaning up there?

(Which is reckoned to be around half the rate of several southern European contries based on GDPs.)
 
In the UK, it is possible to carve out an extremely content, independent lifestyle on not a huge amount of money. This is down to the fact that we have the NHS and social security. From what I’ve seen, it’s extremely difficult to do this in the US.

I agree that private healthcare means that this is near impossible in the US, but I wonder if the UK housing bubble / crisis has rendered it nearly impossible for younger people in the UK, unless their profession allows them to live somewhere with lower housing costs, and they don't have school quality to worry about.

I think you write from the perspective of someone who got on the property ladder before it went bonkers.
 
I agree that private healthcare means that this is near impossible in the US, but I wonder if the UK housing bubble / crisis has rendered it nearly impossible for younger people in the UK, unless their profession allows them to live somewhere with lower housing costs, and they don't have school quality to worry about.

I think you write from the perspective of someone who got on the property ladder before it went bonkers.

I bought my first house in 2001. It seemed an unfathomable amount of money and thought it hugely overpriced. Had to save like crazy for the deposit and the mortgage rate was about 7% IIRC. Fast forward 20 years and yes, that house would have gone up, but I doubt there would be much difference in the monthly mortgage cost because the rates are so much lower and longer term mortgages are now commonplace. That’s the real problem and highlights the damage caused to society by ZIRP. People are now slaves to the bank for 35 - 40 years rather than owning outright after 20.
 
That’s the real problem and highlights the damage caused to society by ZIRP.

Not sure I understand this. Surely if you borrow money, it is better for the borrower to borrow at 0% interest than anything else? The problems in the housing market were started by selling off rented public housing stock very cheaply for political purposes, and not replacing it, again for political purposes
 
Not sure I understand this. Surely if you borrow money, it is better for the borrower to borrow at 0% interest than anything else?

You are assuming that asset prices stay the same with ultra low interest rates, which of course, they don’t and haven’t. The reasons we have asset bubbles everywhere are ZIRP and printy printy. It’s completely stuffed the younger generations.
 
Yep, thanks to cheap debt, asset prices (by which most folks perceive their wealth) have climbed way faster than real economies have grown.

It can't go on forever, by hook or by crook the trend will reverse.
 
Yep, thanks to cheap debt, asset prices (by which most folks perceive their wealth) have climbed way faster than real economies have grown.

It can't go on forever, by hook or by crook the trend will reverse.
So why don’t we go back to the groat?
 
You are assuming that asset prices stay the same with ultra low interest rates, which of course, they don’t and haven’t. The reasons we have asset bubbles everywhere are ZIRP and printy printy. It’s completely stuffed the younger generations.
The younger generation have been stuffed by the ridiculous growth of asset prices, but this is not the product of ZIRP, it’s the product of political decisions to get rid of the offset to rising house prices which is a publicly funded affordable rented housing stock
 
You are assuming that asset prices stay the same with ultra low interest rates, which of course, they don’t and haven’t. The reasons we have asset bubbles everywhere are ZIRP and printy printy. It’s completely stuffed the younger generations.
The rise in UK house prices started in the 1990s. In 1997, UK average house price was 3.6 times the average (full time) income. By 2005 it was 6.5 times average income (source). Interest rates were at 4.5% in 2005. The property affordability crisis started before ZIRP.
 
The younger generation have been stuffed by the ridiculous growth of asset prices, but this is not the product of ZIRP, it’s the product of political decisions to get rid of the offset to rising house prices which is a publicly funded affordable rented housing stock

Of course it’s down to ZIRP and printy printy. House prices are inversely proportional to interest rates.
 
The rise in UK house prices started in the 1990s. In 1997, UK average house price was 3.6 times the average (full time) income. By 2005 it was 6.5 times average income (source). Interest rates were at 4.5% in 2005. The property affordability crisis started before ZIRP.

As I said, prices are inversely proportional to IR’s.
 
The price of my house doubled between 1986 and 1991.
The interest rate dipped a little in that time but remained similar by '91.
Other factors such as MIRAS abolition had some effect.
 
You are assuming that asset prices stay the same with ultra low interest rates, which of course, they don’t and haven’t. The reasons we have asset bubbles everywhere are ZIRP and printy printy. It’s completely stuffed the younger generations.
ZIRP only makes investor types and profit-seeking banks sad, citing it as a cause of asset bubbles is nonsensical. You are not entitled to high rentier profits via interest rate hikes, they are just the luck of a system that offers it through interest rate manipulation as a tool. Keynes was correct when he said it was necessary to "euthanise the rentier class" to eliminate financial instability. And 'prinyprinty' is just ignorant silly talk based on no knowledge. You're going to have to learn and get over this at some point.
 


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