American Economics Thread

PiSigma

PiSigma

"the engineer"
doggydogdo said:
400k at 25? Thats just out of Uni how did u manage to save that much
Click to expand...
Networth. And duo income. I finished my masters when I was 23 and had no debt. Wife had so many scholarships she came out from university with almost 100k.

And like manquiangrexiue, we are good at saving. Don't spend money on useless crap for 10 years like luxury shoes and bags goes a long way. Also we work in oil and gas during the boom years, so plenty of new grads make 100k+.
 
H

HighGround

Senior Member
Registered Member
Sinnavuuty said:
In fact, between the 1990s and 2000s, the US grew at such rates driven by money printing that it ended up creating two bubbles in that period, the Dot-com.com and the subprime bubble. The American economy since the 1980s has been experiencing bubble cycles, part of this growth was actually aimed at new production and investment cycles, but also at the stimulation of such bubbles.
Click to expand...

Well no, it was driven by expanding economic activity... Merely printing money does not grow the GDP by that much.
 
A

antiterror13

Brigadier
PiSigma said:
$6m CAD equivalent. Canada is actually kind of expensive for retirement since government literally only pay out a couple hundred bucks per months starting at 65. By the time I retire it's probably 68 to get payout. I basically assumed my current spending and more for retirement spending, this is due to extra free time so I figured I would travel more. For us average spending per month is 7-8k (no mortgages).

I haven't had a mortgage for 5 years, so it's pretty easy to save 10k+ CAD a month in average. Most months I don't save that much, it's the stock payouts and bonus every spring that's a instant 100k+ savings.

Both my wife and I are in our late 30s, and we are almost half way to our retirement goal, so freedom 50 should be doable. Only concern is the school fees for kids and college fees since both of our kids go to private school and tuition for collage has been going up.
Click to expand...

Great, you are the elite ones. Not many like you in NZ that I know of
 
H

HighGround

Senior Member
Registered Member
Sinnavuuty said:
Exactly. If there were no expansion of the monetary base, gross GDP growth would be much lower, at the same time that real GDP would also be much lower.
Click to expand...
If your rGDP increases by 200%, ideally your money supply should also increase by at least the same amount... If it doesn't, you are risking deflation which has an entirely different set of problems that come along with it.

And most economists understand this, which is why China's money supply also steadily increases...

Anyway, the only really egregious monetary policy moment in recent history by United States was 2016-Present. The money supply explosion in 2008 was the correct call considering all of the various factors at play.
 
Sinnavuuty

Sinnavuuty

Senior Member
Registered Member
HighGround said:
If your rGDP increases by 200%, ideally your money supply should also increase by at least the same amount... If it doesn't, you are risking deflation which has an entirely different set of problems that come along with it.

And most economists understand this, which is why China's money supply also steadily increases...

Anyway, the only really egregious monetary policy moment in recent history by United States was 2016-Present. The money supply explosion in 2008 was the correct call considering all of the various factors at play.
Click to expand...
No.

The growth of the economy is not guaranteed by the growth of the monetary base, but by the increase in production. Price deflation is a completely normal thing, look at the technology sector, prices decrease, this is price deflation, therefore, phones that were previously restricted to just a few people with greater purchasing power now exist in abundance because of the Increasing productivity and new, more productive ways, there has been aggressive price deflation across the technology sector since the 1980s. Saying this is a bad thing doesn't make any sense.

Monetary deflation is a bad thing. These are totally different scenarios here.
 
H

HighGround

Senior Member
Registered Member
Sinnavuuty said:
No.

The growth of the economy is not guaranteed by the growth of the monetary base, but by the increase in production.
Click to expand...

The growth of an economy has to be accomodated by the growth of the monetary base.


Sinnavuuty said:
Price deflation is a completely normal thing, look at the technology sector, prices decrease, this is price deflation, therefore, phones that were previously restricted to just a few people with greater purchasing power now exist in abundance because of the Increasing productivity and new, more productive ways, there has been aggressive price deflation across the technology sector since the 1980s. Saying this is a bad thing doesn't make any sense.
Click to expand...

No, it's not. Price decreases due to production efficiency is completely different from price decreases due to an insufficient monetary base. When this happens, investment and spending is disincentivized. This is why the monetary base has to grow as the economy grows.

Sinnavuuty said:
Monetary deflation is a bad thing. These are totally different scenarios here.
Click to expand...

Which is what we're talking about. You're complaining about US money supply growing. You brought up the growth in money supply 1980-2000 as an example. I pointed out that rGDP did in fact grow (as did other economic activity metrics) which means that the money supply also has to grow in order to accomodate this economic growth.

Bringing up deflation due to production efficiencies is completely off-topic.
 
You must log in or register to reply here.
Top