American Economics Thread

[manqiangrexue]

Americans can also liquidate their real estate to use for retirement, or live with their children.

LOL Chinese elderly can do that, often with open arms except for possible spousal unhappiness, which is usually repressed due to the extreme respect that we typically carry for our parents and parents in law. In America, it's light humor and assumed that we have poor relations with our parents in law, mother-in-law specifically, for some reason. In China, it's considered a huge red flag to someone's character to not offer the best we have to our parents and parents-in-law.

If an American tried that, he's likely to end up with a rent and food bill every month, which can't pay or he'd be still living independently. Or just be flat out refused and on the street. "Hey dad, remember how you told me all my bills were mine to pay after 18 and how granny and gramps both got put in a hospice when they wanted to move in with us? Your turn now."

 

[MortyandRick]

No: it’s a very well established pattern that in survey responses, “X is bad but my experience with X is good” consistently shows up. Same here, with healthcare.

Any date to back up this assertion? Otherwise you're saying that all surveys are not good, even the ones you used.

Yes, hospital debt will increase. Part of the broader trend in healthcare is that individual practices are becoming consolidated into larger hospital chains. Medical debt, is also, uncommon -

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- especially since the ACA has mandated out-of-pocket ceilings for health insurers

Doesn't matter, health care debt is still growing. Your source basically says that even if your health is excellent, 4% still have medical debt. If your health is poor, it's 20%. And if your health is fair, it's 14%. This is still much higher than other OCED countries.

For lower-income Americans who will get near income replacement from social security and/or sale of home equity, they simply have no need to have retirement savings.

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You can cherry pick data, but I can too

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Many older Americans are working in their old age to maintain their income

 

[chgough34]

LOL @chgough34 arguing with himself, like some mental gynmastics athlete snapping his back from twisting:

@chgough34 The US economy is so strong and people are so confident that people don't have any reason to save money. Half of Americans don't even know what saving is; as a matter of fact, they're pissed off to see any money on the table at all because they're angry that it hasn't been converted to instantaneous fun! They are confident that whatever happens, the US economy will handle it and bail them out easily. That is why the lower the savings rate, the higher the confidence in the economy and the stronger the economy.

Also @chgough34 : No, that's bullshit. Americans now have a savings rate that's higher than ever, debunking the claim that most Americans live paycheck-to-paycheck. The increase in savings is the key sign of a strong and confident ecnomy.

There is nothing inconsistent here. Households have liquidity to pay for immediate accounts payables and save to smooth consumption for both large ticket purchases such as a car or vacation as well as inevitable future risks such as retirement. A growing economy means higher income, higher consumption, and higher future consumption (which necessitates savings today). Savings rates will fall during good economic times but savings volumes will increase.

 

[manqiangrexue]

There is nothing inconsistent here. Households have liquidity to pay for immediate accounts payables and save to smooth consumption for both large ticket purchases such as a car or vacation as well as inevitable future risks such as retirement. A growing economy means higher income, higher consumption, and higher future consumption (which necessitates savings today). Savings rates will fall during good economic times but savings volumes will increase.

Yeah you don't see the inconsistency in arguing with yourself but everyone else does. If you did, you'd be improving, and being very un-American.

So anyway, would higher savings indicate a stronger or weaker economy? Go ahead and answer that (rate, volume, whatever you like) and I'll just pull your crap back up and have you argue with yourself again.

 

[chgough34]

Any date to back up this assertion? Otherwise you're saying that all surveys are not good, even the ones you used.

Americans dislike the education system in general but they like their local school -

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Americans think their state economy is doing well but not the national economy -

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Americans dislike “Congress” but like their own Congress member -

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Doesn't matter, health care debt is still growing. Your source basically says that even if your health is excellent, 4% still have medical debt. If your health is poor, it's 20%. And if your health is fair, it's 14%. This is still much higher than other OCED countries.

Yes: healthcare isn’t perfect but medical debt indebtness is a problem which is highly concentrated in a few individuals, it is not widespread.

Many older Americans are working in their old age to maintain their income

The older workforce growth is made up of college educated white collar workers. Hardly financially distressed individuals -

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[chgough34]

Yeah you don't see the inconsistency in arguing with yourself but everyone else does. If you did, you'd be improving, and being very un-American.

So anyway, would higher savings indicate a stronger or weaker economy? Go ahead and answer that (rate, volume, whatever you like) and I'll just pull your crap back up and have you argue with yourself again.

Yes: it’s literally just intertemporal choice. Precautionary savings are used to smooth consumption over a lifetime in anticipation of risks to income generation - unemployment, disability, old age, etc. if unemployment risks are perceived to be small, individuals will save a smaller share of their income. If future consumption in retirement will be higher, people will save a larger amount of money. US households (esp. white collar professionals) have negligible unemployment risk so outside of retirement savings and using their house as a savings account, they don’t need substantial liquidity and thus spend more. Lower income households, also don’t save much because they have social security in old age which provides near full income replacement and have Medicaid and SSI to cover health and disability risks.

When unemployment risks are high - people save more. Savings rates go up during recessions -

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[manqiangrexue]

Yes: it’s literally just intertemporal choice. Precautionary savings are used to smooth consumption over a lifetime in anticipation of risks to income generation - unemployment, disability, old age, etc. if unemployment risks are perceived to be small, individuals will save a smaller share of their income. If future consumption in retirement will be higher, people will save a larger amount of money. US households (esp. white collar professionals) have negligible unemployment risk so outside of retirement savings and using their house as a savings account, they don’t need substantial liquidity and thus spend more. Lower income households, also don’t save much because they have social security in old age which provides near full income replacement and have Medicaid and SSI to cover health and disability risks.

When unemployment risks are high - people save more. Savings rates go up during recessions -

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Hey, this guy said you're an idiot and quoted a guy saying that Americans have the highest on record savings to income ratio, taking that as a positive sign. I think you should go put this fool in his place:

Households living paycheck to paycheck is a function of poor survey design and inconsistent standards, especially when household balance sheets are strong

https://twitter.com/i/web/status/1769362133760815143

 

[chgough34]

Hey, this guy said you're an idiot and quoted a guy saying that Americans have the highest on record savings to income ratio, taking that as a positive sign. I think you should go put this fool in his place:

Yeah it’s not inconsistent: the savings rate is has never been 0%, just very close to 0%. Households save more and spend more because they earn more. But the % of their income that they save is lower because they don’t need to save out of caution.

 

[FairAndUnbiased]

Only in NY, LA, and SF areas.

Making 6 figures outside of those states provides a very good lifestyle. Seattle is like a top 10 area and it is very much affordable on 100K.
The issue is buying a house. You can find an apartment easily, but actual single family homes in SEA are beyond the means of vast majority of people.

That said, the obsession with single family housing is one of the core problems behind unaffordable housing.

SFH is due to zoning. Many places have nothing but SFH.

 

[Sinnavuuty]

There is nothing inconsistent here. Households have liquidity to pay for immediate accounts payables and save to smooth consumption for both large ticket purchases such as a car or vacation as well as inevitable future risks such as retirement. A growing economy means higher income, higher consumption, and higher future consumption (which necessitates savings today). Savings rates will fall during good economic times but savings volumes will increase.

It does not have. Now for an American family of 4 to live comfortably, they need to have an income of US$177,798.

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This is still true in cheaper states like Mississippi, in the more expensive states, that same family needs to have an income of +US$300,000. The study determined that Massachusetts is the most expensive state.

The study “surprisingly” shocking to some, most Americans do not make enough money to “live comfortably” in the highly inflationary environment they find themselves in today.

And all of this combined with families taking out loans to survive, defaulting on credit cards and much more.

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Additionally, according to recent research, approximately half of the entire American population is struggling with mental health issues due to financial stress…

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About half of U.S. adults are struggling with their mental health because of their financial situation.

Forty-seven percent of adults say concerns about money have, at least occasionally, caused anxiety, stress, worrisome thoughts, loss of sleep, depression or other effects, according to Bankrate’s latest Money and Mental Health Survey.

About 65% of them say their biggest concern is inflation and rising prices, and nearly 60% say their stress derives from paying for everyday expenses such as groceries and utilities. About 56% say they are worried about having enough emergency savings, and 47% are most concerned about being in debt, according to the survey.