Social Security Discussion

[expat_panama]

...Median household net worth: $68,828...

--and the median age is 34. The median saves enough, the average is very well off, and this is why the only way the loopylefites can "sell" SS is by force.

68K wow those are some lucky folks.

Actually, there's no way around the fact that Americans are blessed. This is as seen though hard numbers from the Census Br. or the Fed's Flow of Funds even while soft made up source-free numbers--

10 years away from retirement, the median savings is $12,000

--try to paint a false picture. Sure, when it comes to individuals America is very diverse and there actually are serious cases of severe need. The point is that SS has been forced on all in a misguided effort to help those few cases of severe need.

 

[Rshermr]

68K wow those are some lucky folks.

Actually, there's no way around the fact that Americans are blessed. This is as seen though hard numbers from the Census Br. or the Fed's Flow of Funds even while soft made up source-free numbers--

10 years away from retirement, the median savings is $12,000

--try to paint a false picture. Sure, when it comes to individuals America is very diverse and there actually are serious cases of severe need. The point is that SS has been forced on all in a misguided effort to help those few cases of severe need.

Of course, that is what you believe. It goes perfectly with your agenda. Which is a con agenda.
Now, find me the politicians that wish to do away with social security, or who are campaigning to privatize it. They seem to be in hiding. Because they know that pushing to eliminate or privatize ss will end their political careers. And that, me boy, is because the vast majority of the american electorate does not want ss privatized or eliminated. So, you see, your opinion is of no value. We have elections. And as long as we do, your ideas will always loose.
But thanks for your opinion. Though I could have read it from the same sources you love to quote. Those being, of course, the bat shit crazy con web sites.

 

[SteadyMercury]

Actually, there's no way around the fact that Americans are blessed.

Without a doubt Americans are blessed, anyone born here got lucky right off the bat.

However that fact doesn't validate your claims about people saving enough for retirement when clearly they are not.

--try to paint a false picture.

Says the guy who doesn't understand his own data while dismissing any that isn't convenient to his argument.

"For people 10 years away from retirement, the median savings is $12,000. "Of the people between 55 and 64, one third haven't saved anything for retirement"

I know you had trouble with median vs. average before so I'll explain... this means that 10 years away from retirement half the people have less than 12k saved up.

 

[Foxfyre]

Actually, there's no way around the fact that Americans are blessed.

Without a doubt Americans are blessed, anyone born here got lucky right off the bat.

However that fact doesn't validate your claims about people saving enough for retirement when clearly they are not.

--try to paint a false picture.

Says the guy who doesn't understand his own data while dismissing any that isn't convenient to his argument.

"For people 10 years away from retirement, the median savings is $12,000. "Of the people between 55 and 64, one third haven't saved anything for retirement"

I know you had trouble with median vs. average before so I'll explain... this means that 10 years away from retirement half the people have less than 12k saved up.

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

 

[Rshermr]

Actually, there's no way around the fact that Americans are blessed.

Without a doubt Americans are blessed, anyone born here got lucky right off the bat.

However that fact doesn't validate your claims about people saving enough for retirement when clearly they are not.

--try to paint a false picture.

Says the guy who doesn't understand his own data while dismissing any that isn't convenient to his argument.

"For people 10 years away from retirement, the median savings is $12,000. "Of the people between 55 and 64, one third haven't saved anything for retirement"

I know you had trouble with median vs. average before so I'll explain... this means that 10 years away from retirement half the people have less than 12k saved up.

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

You seem to have an issue with definitions. Since ss retirees paid for the benefits from ss, it is a bit stupid to say that they are begging for '"government" money. And to prove you are really stupid, you want the gov to keep the money they paid in and cut ss.
Not that it matters. What you think is of no value. What is of value is what the electorate think. And they like ss. So, you loose. Sorry, me boy.

 

[SteadyMercury]

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

Agreed

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

But how do you accomplish this?

 

[Toddsterpatriot]

Without a doubt Americans are blessed, anyone born here got lucky right off the bat.

However that fact doesn't validate your claims about people saving enough for retirement when clearly they are not.


Says the guy who doesn't understand his own data while dismissing any that isn't convenient to his argument.

"For people 10 years away from retirement, the median savings is $12,000. "Of the people between 55 and 64, one third haven't saved anything for retirement"

I know you had trouble with median vs. average before so I'll explain... this means that 10 years away from retirement half the people have less than 12k saved up.

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

You seem to have an issue with definitions. Since ss retirees paid for the benefits from ss, it is a bit stupid to say that they are begging for '"government" money. And to prove you are really stupid, you want the gov to keep the money they paid in and cut ss.
Not that it matters. What you think is of no value. What is of value is what the electorate think. And they like ss. So, you loose. Sorry, me boy.

Since ss retirees paid for the benefits from ss,

As long as you ignore the $12 trillion shortfall over the next 75 years. Sorry, me boy.

 

[expat_panama]

...claims about people saving enough for retirement when clearly they are not...

Claims they have are like claims they haven't --they're worthless. What matter's is reality, and we can see it with real life head counts and real life bank balances. We've already looked at Census Br. numbers and the Fed's balances, so it's time to agree that the facts are what they are. Something else we need to understand is that Social Security will not provide a decent income for people when "clearly they are not" prepared. From ssa.gov's own site:

Most financial advisors say you'll need about 70 percent of your pre-retirement earnings to comfortably maintain your pre-retirement standard of living. If you have average earnings, your Social Security retirement benefits will replace only about 40 percent. The percentage is lower for people in the upper income brackets and higher for people with low incomes. You'll need to supplement your benefits with a pension, savings or investments.

The bottom line here is that people need to work to eat and they need to save to retire. Most people do save and don't need or want SS, and SS will not be enough to help out those who hasn't saved.

 

[Foxfyre]

Without a doubt Americans are blessed, anyone born here got lucky right off the bat.

However that fact doesn't validate your claims about people saving enough for retirement when clearly they are not.


Says the guy who doesn't understand his own data while dismissing any that isn't convenient to his argument.

"For people 10 years away from retirement, the median savings is $12,000. "Of the people between 55 and 64, one third haven't saved anything for retirement"

I know you had trouble with median vs. average before so I'll explain... this means that 10 years away from retirement half the people have less than 12k saved up.

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

You seem to have an issue with definitions. Since ss retirees paid for the benefits from ss, it is a bit stupid to say that they are begging for '"government" money. And to prove you are really stupid, you want the gov to keep the money they paid in and cut ss.
Not that it matters. What you think is of no value. What is of value is what the electorate think. And they like ss. So, you loose. Sorry, me boy.

Since I didn't define anything and said absolutely nothing even similar to what you are accusing me of saying and wanting, I don't think I am the one who is the stupid one here.

 

[william the wie]

...claims about people saving enough for retirement when clearly they are not...

Claims they have are like claims they haven't --they're worthless. What matter's is reality, and we can see it with real life head counts and real life bank balances. We've already looked at Census Br. numbers and the Fed's balances, so it's time to agree that the facts are what they are. Something else we need to understand is that Social Security will not provide a decent income for people when "clearly they are not" prepared. From ssa.gov's own site:

Most financial advisors say you'll need about 70 percent of your pre-retirement earnings to comfortably maintain your pre-retirement standard of living. If you have average earnings, your Social Security retirement benefits will replace only about 40 percent. The percentage is lower for people in the upper income brackets and higher for people with low incomes. You'll need to supplement your benefits with a pension, savings or investments.

The bottom line here is that people need to work to eat and they need to save to retire. Most people do save and don't need or want SS, and SS will not be enough to help out those who hasn't saved.

Likewise medicare. I have been looking over the concierge medical services that are cropping up as hospitals close due to Obamacare. They are generally cheaper than medicare parts A&B.

 

[oldfart]

Will respond to this treatise Thursday.

For today quick comments:
Government does not provide.

Take your time; no hurry.

If you believe government does not provide services, you are operating outside commonly accepted definitions and reality. If you have a beef with your neighbor and decide to sue him, who provides the court?

It redistributes what it takes by force.

So are you an anarchist, believing that all government is theft? Or is "taking by force" just being used as a pejorative term for a socially necessary taking? Or perhaps you are a communalist or primitive communist (Engels term) who believes all community needs are to be met by "voluntary" contributions?

This is the kind of talk that gets people on the libertarian right labeled as either lunatics, utopian socialists, on one hand or as Hobbesian social Darwinists on the other.

A floor on standard of living for otherwise capable workers, is the creation of a class of parasites. Or are you gonna create work quotas too?

I favor public employment for all who want to work and cannot find it in the private sector. Such a public employment system might be able to render the legal minimum wage unnecessary, as well as unemployment compensation. The existing retirement, disability, and survivor social insurance system would remain in place. Candidates for your "parasite class" would be the remaining small pool of people seemingly capable of work who nonetheless choose not to take public employment. Would I advocate forcing them to work as a condition of assistance? I would not. Reluctant workers tend to be bad workers.

Realistically, the largest part of this group would be choosing not to work for reasons I would support, such as to obtain education or training, or to care for family members. Another large group would be people unable to hold useful employment due to mental or physical disorders who do not meet the stricter definitions of disability. I personally have no trouble supporting these people, especially of the medical care provided them includes substance abuse and rehabilitation services.

I suppose this leaves a residue of congenitally lazy which you would frown upon supporting. I am convinced that it is cheaper and more humane to support them than it is to try to force them conform to a more "noble" lifestyle. Given our stirling record of success in rehabilitating prison inmates, I have little confidence in our ability to change behavior by force or deprivation.

 

[Foxfyre]

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

Agreed

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

But how do you accomplish this?

I wish I knew. We have become an entitlement, the world owes us a living, society instead of a society that takes personal responsibility with people who look to themselves instead of to government to achieve what they want.

But we got here by a slow but steady drip by drip process of substituting those old, time proved values with the statist/political class collectivist mentality. It first permeated the media and education and now has become a way of life for far too many. Government no longer does the will of the people but is ever more bloated and top heavy and self serving for its own interests. Politicians and bureaucrats no longer seek office as public servants but rather as career politicians and bureaucrats who are interested first and foremost in increasing their own power, prestige, influence, and personal wealth. And they are slowly but sure draining more and more resources from the private sector to accomplish that while throwing the people a bone now and then to keep them happy.

What it will take to reverse that is something I don't know if we, as a people, have the will to do: demand that the government do much much less for us and expect the people to do much more for themselves.

 

[RKMBrown]

Will respond to this treatise Thursday.

For today quick comments:
Government does not provide.

Take your time; no hurry.

If you believe government does not provide services, you are operating outside commonly accepted definitions and reality. If you have a beef with your neighbor and decide to sue him, who provides the court?

Well you quoted this out of the context of providing welfare. When I pay someone for a service, they are doing the job they are paid to do. When I'm forced to pay for a service I don't want against my will, it's economic rape.

It redistributes what it takes by force.

So are you an anarchist, believing that all government is theft? Or is "taking by force" just being used as a pejorative term for a socially necessary taking? Or perhaps you are a communalist or primitive communist (Engels term) who believes all community needs are to be met by "voluntary" contributions?

This is the kind of talk that gets people on the libertarian right labeled as either lunatics, utopian socialists, on one hand or as Hobbesian social Darwinists on the other.

No I'm not an anarchist. And, yes your argument is the tired old lunatic argument for justification of tyranny. Re-distribution of money from peter to paul is not governing and is not a service to peter any more than rape is a service. Re-distribution against one's will is theft. A violent crime against peter for the benefit of paul.

A floor on standard of living for otherwise capable workers, is the creation of a class of parasites. Or are you gonna create work quotas too?

I favor public employment for all who want to work and cannot find it in the private sector. Such a public employment system might be able to render the legal minimum wage unnecessary, as well as unemployment compensation. The existing retirement, disability, and survivor social insurance system would remain in place. Candidates for your "parasite class" would be the remaining small pool of people seemingly capable of work who nonetheless choose not to take public employment. Would I advocate forcing them to work as a condition of assistance? I would not. Reluctant workers tend to be bad workers.

Realistically, the largest part of this group would be choosing not to work for reasons I would support, such as to obtain education or training, or to care for family members. Another large group would be people unable to hold useful employment due to mental or physical disorders who do not meet the stricter definitions of disability. I personally have no trouble supporting these people, especially of the medical care provided them includes substance abuse and rehabilitation services.

I suppose this leaves a residue of congenitally lazy which you would frown upon supporting. I am convinced that it is cheaper and more humane to support them than it is to try to force them conform to a more "noble" lifestyle. Given our stirling record of success in rehabilitating prison inmates, I have little confidence in our ability to change behavior by force or deprivation.

Why am I not surprised you would be a proponent of even more government programs to funnel money to democrat voters. Let me guess we'll pay these people to be community organizers, maybe call the group ACORN^2.

Hunger is a pretty damn good motivator. Handing people cell phones, rent checks, and credit cards to be a member of the moocher class is not an incentive to change behavior.

While you may believe helping people to remain dirt poor for life through a system of hand-outs is good for people, I put it to you that you are crippling generations of families. In short, your lack of vision is creating hell on earth. To what benefit? How are you personally benefiting from keeping 50million+ Americans (and growing) in poverty through this system of hand-outs instead of hand-ups?

 

[jasonnfree]

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

Agreed

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

But how do you accomplish this?

The job numbers look pretty bad with people spending pretty much all they earn now. If America became a nation of people that saved more and bought less, how would that affect job numbers? Just saying.

 

[Rshermr]

Will respond to this treatise Thursday.

For today quick comments:
Government does not provide.

Take your time; no hurry.

If you believe government does not provide services, you are operating outside commonly accepted definitions and reality. If you have a beef with your neighbor and decide to sue him, who provides the court?

Well you quoted this out of the context of providing welfare. When I pay someone for a service, they are doing the job they are paid to do. When I'm forced to pay for a service I don't want against my will, it's economic rape.




No I'm not an anarchist. And, yes your argument is the tired old lunatic argument for justification of tyranny. Re-distribution of money from peter to paul is not governing and is not a service to peter any more than rape is a service. Re-distribution against one's will is theft. A violent crime against peter for the benefit of paul.

A floor on standard of living for otherwise capable workers, is the creation of a class of parasites. Or are you gonna create work quotas too?

I favor public employment for all who want to work and cannot find it in the private sector. Such a public employment system might be able to render the legal minimum wage unnecessary, as well as unemployment compensation. The existing retirement, disability, and survivor social insurance system would remain in place. Candidates for your "parasite class" would be the remaining small pool of people seemingly capable of work who nonetheless choose not to take public employment. Would I advocate forcing them to work as a condition of assistance? I would not. Reluctant workers tend to be bad workers.

Realistically, the largest part of this group would be choosing not to work for reasons I would support, such as to obtain education or training, or to care for family members. Another large group would be people unable to hold useful employment due to mental or physical disorders who do not meet the stricter definitions of disability. I personally have no trouble supporting these people, especially of the medical care provided them includes substance abuse and rehabilitation services.

I suppose this leaves a residue of congenitally lazy which you would frown upon supporting. I am convinced that it is cheaper and more humane to support them than it is to try to force them conform to a more "noble" lifestyle. Given our stirling record of success in rehabilitating prison inmates, I have little confidence in our ability to change behavior by force or deprivation.

Why am I not surprised you would be a proponent of even more government programs to funnel money to democrat voters. Let me guess we'll pay these people to be community organizers, maybe call the group ACORN^2.

Hunger is a pretty damn good motivator. Handing people cell phones, rent checks, and credit cards to be a member of the moocher class is not an incentive to change behavior.

While you may believe helping people to remain dirt poor for life through a system of hand-outs is good for people, I put it to you that you are crippling generations of families. In short, your lack of vision is creating hell on earth. To what benefit? How are you personally benefiting from keeping 50million+ Americans (and growing) in poverty through this system of hand-outs instead of hand-ups?

Poor old RKM. All he has is con dogma. Thinks the whole issue of income redistribution is a bad thing, and that dems think it is a good thing. So, lets see, where has the income been going??? Because RKM does not want to know, but those WITH a brain do know. So, read them and weap, RKM:
Top 1% Got 93% of Income Growth as Rich-Poor Gap Widened - Bloomberg

In the U.S., the Rich Are Getting Richer While the Poor Get Poorer -- Fusion.

The Rich Are Getting Richer And Everyone Else Is Getting Hosed - Business Insider

State of Working America preview: The rich get richer | Economic Policy Institute

Haves and have nots: America's rich get richer

A Look at the Numbers: How the Rich Get Richer | Mother Jones

http://www.nytimes.com/2012/03/26/opinion/the-rich-get-even-richer.html?_r=0

In This Recovery, the Rich Get Richer | Smart Charts, What Matters Today | BillMoyers.com

Why the Rich Are Getting Richer | Foreign Affairs

Now, here is the thing, RKM. I am sure you think that the drivel you read, and then spew on this thread, has some validity. Got a source, me poor ignorant tool? Let's see where you get the idea that the poor and middle class are getting wealthier as a result of handouts from the wealthy. Because, me boy, it is just the opposite. The working class is making the wealthy more so. And loosing their share of the american dream.

Now, I am sure you have some great comeback, that only makes sense to you. But you see, RKM, you have proven yourself incapable of rational conversation, with any kind of impartial backing. You just post drivel from right wing bat shit crazy con web sites, with no backing for your opinions.

 

[Rshermr]

The problem is not solved, however, by promising them more government money in their old age and thereby make it seem even less urgent to save now.

Agreed

The problem is solved with a change in cultural expectations and peer pressure. When it is again the norm that responsible and patriotic people will save a certain percentage of their income for their old age, they will be much more inspired to do that even if it means postponing upgrading their smart phone or buying a new car for awhile. And then we only have a few of the most selfish and irresponsible people instead of millions and milllions to deal with.

But how do you accomplish this?

The job numbers look pretty bad with people spending pretty much all they earn now. If America became a nation of people that saved more and bought less, how would that affect job numbers? Just saying.

Here is the problem. For YEARS we have watched income and wealth redistribute to the wealthy. And we have watched the workers get less and less of the growth in income and wealth. So, unlike in the 1950's, the american worker has little left over to spend to provide income for retirement. Hell, if he has a family, then saving something for college costs would pretty well wipe out what he might be able to save for retirement. PLEASE:
Read this ONE short piece to get a good understanding of what is going on, and has for over the past 35 years. And there are at least a hundred studies out on the net SAYING THE SAME THING:
Top 1% Got 93% of Income Growth as Rich-Poor Gap Widened - Bloomberg

The concept that the right wing tools are pushing is straight from the bat shit crazy con sites. It states that people have somehow changed and gotten lazy. But they have NO proof. As a matter of fact, productivity of US workers is among the very highest of any nation in the world, and higher than at any time in history.

So, sure, there are lazy folks out there. But here is what they forget to mention. 1. There always have been lazy people. 2. There are plenty of rich lazy people, also. 3. The great majority of people out there ARE NOT LAZY. What they are is working harder to make less than at any time since the great depression. And, of course, conservatives like it that way.

 

[RKMBrown]

For myself, I regard my politics as first and foremost pragmatic. I have an ideology, but more than that I want the American economy to work well for everyone. Economics is not a zero sum game; good economic policy is a positive sum game and lots of bad policy is a decidedly negative sum game.

I only speak for myself, so if "a lot of people" claim to be pragmatists" you would have to check with them to see what they mean. For my self, pragmatism is based on my experience and training. For example, I believe that out of every ten great sounding ideas about eight will be failures. The problem is that the losers generally sound as good as the winners before you try them. So I don't bet the farm on the first idea. I design a fair trial, spend the money, and if it fails, I count it money well spent on information and move on. Every success looks obvious in retrospect.

The opposite of pragmatism is magical thinking. Magical thinking involves coming up with creative reasons for the failure of projects that were a flawed idea from the start. There is a difference between a bad concept and bad execution, but throwing more money at a flawed project does not cure the flaw.

If you don't like one of my arguments, I can be persuaded. Assuming we have compatible goals and values, I will happily abandon any proposal when I become convinced there is something better. In general I find that means that curbing monopoly power is generally good and that market solutions are preferable to command solutions.

So basically you are saying your version of pragmatism is a myoptic view of the world in which you and you alone have the knowledge, expertise, and authority to command everyone on the planet to bend to your will. I see. So basically you are an authoritarian socialist with a penchant for experimentation with other people's lives for the fun of it. What the hell OCA, SS, Medicare, all government take overs of our lives are just experiments, if they don't work you'll just double down on more taxes and government regulations till you get it right.

But yeah I get that if I "quit" working "quit" caring about personal responsibilities quit giving a shit about others, that I could also just jump on the dole with the other 50million Americans and enjoy the ride to the bottom.

 

[Kimura]

FRB: Z.1 Release--Financial Accounts of the United States--September 25, 2013

Really? I see net wealth as larger than public debt.

I'm talking about net financial assets. One's financial asset is offset by a another's financial liability. Bonds and currency are financial assets. In the aggregate, as a matter of accounting, net financial wealth must ultimately equal zero.

REAL assets aren't offset by another liability which means at the aggregate level net wealth would equal the value of real assets. For example, you may have purchased and automobile and went into debt. The car note (financial liability) would be offset by the financial asset held by the loan company. Since they ultimately net to zero, what we have left is the value of the real asset - the automobile.

Sorry about the confusion. I'm mostly concerned about with financial assets when discussing macro and monetary operations, but I will try to remember that real assets provide net wealth at aggregate and individual levels so to speak. If we subtract any and all financial liabilities from total assets - both financial and real - we're only left with real assets (aggregate net worth).

One's financial asset is offset by a another's financial liability.

So if I buy a new issue at $20, the issuing firm has a liability of $20.
Now the stock goes up to $30. I think financial assets are now larger than liabilities.
How am I wrong?

Individuals or firms selling stocks have bank accounts, right? For example, if an investor purchases assets from a seller, such as a corporate bonds or stocks, then payments are made from the bank to the seller. In order for any payments to be cleared and settled, a debit will be made from the reserve account of the bank buying these assets to the reserve account of the seller’s bank. Total net bank reserves are unaffected (unless the seller has a deposit account at the purchasing bank, then the bank will just credit more $$$$ to seller’s deposit account, both the bank’s reserves and aggregate reserves will remain unaffected).

 

[RKMBrown]

I'm talking about net financial assets. One's financial asset is offset by a another's financial liability. Bonds and currency are financial assets. In the aggregate, as a matter of accounting, net financial wealth must ultimately equal zero.

REAL assets aren't offset by another liability which means at the aggregate level net wealth would equal the value of real assets. For example, you may have purchased and automobile and went into debt. The car note (financial liability) would be offset by the financial asset held by the loan company. Since they ultimately net to zero, what we have left is the value of the real asset - the automobile.

Sorry about the confusion. I'm mostly concerned about with financial assets when discussing macro and monetary operations, but I will try to remember that real assets provide net wealth at aggregate and individual levels so to speak. If we subtract any and all financial liabilities from total assets - both financial and real - we're only left with real assets (aggregate net worth).

One's financial asset is offset by a another's financial liability.

So if I buy a new issue at $20, the issuing firm has a liability of $20.
Now the stock goes up to $30. I think financial assets are now larger than liabilities.
How am I wrong?

Individuals or firms selling stocks have bank accounts, right? For example, if an investor purchases assets from a seller, such as a corporate bonds or stocks, then payments are made from the bank to the seller. In order for any payments to be cleared and settled, a debit will be made from the reserve account of the bank buying these assets to the reserve account of the seller’s bank. Total net bank reserves are unaffected (unless the seller has a deposit account at the purchasing bank, then the bank will just credit more $$$$ to seller’s deposit account, both the bank’s reserves and aggregate reserves will remain unaffected).

Chicken vs. egg. What came first the shinny new dollar bill or the apple I pulled off the tree and sold to you for a dollar. News flash I'll trade you that orange you have for an apple. Oh wait where's the dollar in that deal?

 

[SteadyMercury]

The job numbers look pretty bad with people spending pretty much all they earn now. If America became a nation of people that saved more and bought less, how would that affect job numbers? Just saying.

Dunno. If they saved by investing maybe create new jobs?