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Millennials own just 3% of all Household Wealth!!!


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Unemployment rate (%) 1971-2021

image.png.f51ceae51d9006b9ca02712838ee46b4.png

Here you can see the major problem facing the population from the late 1970's to the late 1990's.  This was what concerned voters back then.

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UK GDP per capita, constant prices in £.

Here you can see GDP per person is roughly double what it was in the 1980's.  Really we should be much richer than boomers when they were young.

The problem is, GDP stopped being shared proportionately with the workers sometime in the 1970's.  Somehow this connection needs restoring.

United Kingdom GDP Constant Prices

From 

https://tradingeconomics.com/united-kingdom/gdp-constant-prices

 

 

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US Assets by age group.  Not sure if this is corrected for inflation or if it applies particularly well to the UK.

However just look how total assets wealth has gone up over time, and this goes back only as far as 1989.

image.png.0e2b38b29ad93581d2788529bb353999.png

https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/#range:1989.3,2020.4;quarter:125;series:Assets;demographic:age;population:1,3,5,7;units:levels

 

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5 hours ago, kzb said:

Unemployment rate (%) 1971-2021

image.png.f51ceae51d9006b9ca02712838ee46b4.png

Here you can see the major problem facing the population from the late 1970's to the late 1990's.  This was what concerned voters back then.

Unemployment which I'm sure was very painful if you happened to be one of the 1 in 10 who were out of work for a significant length of time in that 1981-1997 block but if you were in the 9 in 10 it was a period of increasing real wages and rising homeownership.

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5 hours ago, kzb said:

US Assets by age group.  Not sure if this is corrected for inflation or if it applies particularly well to the UK.

However just look how total assets wealth has gone up over time, and this goes back only as far as 1989.

image.png.0e2b38b29ad93581d2788529bb353999.png

 

This graph is showing both a large amount of asset price inflation and a drop in the share of assets held by people under 55. The mathematical link between these two facts is not hard to figure out, if asset prices rise relative to wages then younger people will accumulate assets more slowly.

For example, when my mother was approaching retirement age a few years ago she rounded up all of her old occupational pensions and found she had one from when she worked in a big corporation for a year after graduating in the 1970s. The value of this pension is over £1500pa now, for literally 1 year of work as a 21 year old new starter with zero experience. Today's 21 year old recruit might chuck in, say 10% of £25k including matching contributions into a defined contribution pension, so about £2.5k going into the pension pot. At a 4% drawdown rate that £2.5k is worth about £100pa. Even if you take into account a real return on that initial £2.5k of say 2% over 47 years that only beefs it up to £250pa, still just one-sixth of what a 1970s worker could get. Also my parents bought their first house in NW London as recent graduates in the mid-1970s whereas their 2021 equivalents would most likely be renting in shared houses for pretty much their entire 20s, yet another huge gulf in asset price accumulation.

Edited by Dorkins
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5 hours ago, kzb said:

Here you can see GDP per person is roughly double what it was in the 1980's.  Really we should be much richer than boomers when they were young.

The problem is, GDP stopped being shared proportionately with the workers sometime in the 1970's.  Somehow this connection needs restoring.

Is another significant factor the increase in the proportion of adults who work (i.e. more women remaining single longer and continuing/returning to work after having children)?

If you earn an average salary, there probably isn't much left after childcare. A lot of the net financial benefits of the move to two income households goes to high earners, capital and the owners of the assets (i.e. houses) which are bid up as two income households can borrow more to buy them.

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1 hour ago, Young Turk said:

Is another significant factor the increase in the proportion of adults who work (i.e. more women remaining single longer and continuing/returning to work after having children)?

If you earn an average salary, there probably isn't much left after childcare. A lot of the net financial benefits of the move to two income households goes to high earners, capital and the owners of the assets (i.e. houses) which are bid up as two income households can borrow more to buy them.

The increase in employment is not as big as people think, it's gone from 90% of men and 50% of women employed in the 1950s to about 70% of both employed, net increase in employment not much and certainly not the doubling that so many people say it is. Plus those 1950s male jobs were almost all full time whereas a lot of the new jobs are part time.

Edited by Dorkins
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2 minutes ago, Dorkins said:

The increase in employment is not as big as people think, it's gone from 90% of men and 50% of women employed in the 1950s to about 70% of both employed, net increase in employment not much. Plus those 1950s male jobs were almost all full time whereas a lot of the new jobs are part time.

If those figures are correct, doesn't that imply a decrease in the proportion employed? (70% of adults working, mostly full-time in the 50s; 70% of adults working, many of them part-time now). That seems implausible.

Maybe married couples don't work a lot more. But combine that with people getting married on average about 10 years later and getting divorced more.

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10 minutes ago, Young Turk said:

If those figures are correct, doesn't that imply a decrease in the proportion employed? (70% of adults working, mostly full-time in the 50s; 70% of adults working, many of them part-time now). That seems implausible.

Maybe married couples don't work a lot more. But combine that with people getting married on average about 10 years later and getting divorced more.

See for yourself: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/employmentintheuk/november2020

 

image.png.83dff9c33cbe3990788e8e558c51253b.png

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I think ‘full employment’ is considered anything below 5% unemployment so pre 1980 the boomers had full employment.

I know plenty of stories of boomers just moving around factories for wages and literally walking into jobs. Not to mention all the strikes they did to damage the economy back then which we still feel to this day, and they would of been established in their jobs by then, and at the peaks of their careers from the mid-90’s all the way to the crisis in 2008 also enjoyed full employment. Not great for the oldies made redundant in 2008 at their peaks then faced age discrimination, but again less of a worry with a paid off mortgage and a tasty pension waiting for you in short order.  

not to mention rampant HPI are an accelerating share of the wealth. 

Millenials entered the work force in a non-established position in the worst employment landscape post 2008 for 20 year, struggled for years and were then hit by covid recently also, coupled with lower earnings, high house prices, expensive education (which is more required than it ever was back in the day when uni was a golden ticket, now it’s just a tick box), rubbish pensions, poor political landscape which only cators for the older generation (see brexit), which in itself has further to diminished the economy.

not to mention said millennials are held back as boomers clog up the very top levels of companies in ‘hobby jobs’ preventing the dead man shoes clearing and wage growth that they themselves enjoyed. 
 

the boomers created their own wealth as they consumed loads as a generation, but now as a generation they are sucking far more out of the system than they ever put in, and this load is being places on the millennial generation and worn out infrastructure left to them. State pensions paid for our of taxes of crushed workers. 

I mean nothing will be done for a good 5-10 years yet, but eventually the politicians will do their studies and work out what will be popular with the by then 40 year olds who have been crushed their whole lives, I think forced wealth redistribution is going to happen, it’s very likely, it’s in the figures really. it won’t be called that, it will be given a better political name like ‘reduced taxes for the under 45’s” while hiking taxes for other age groups. 

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14 minutes ago, jiltedjen said:

I mean nothing will be done for a good 5-10 years yet, but eventually the politicians will do their studies and work out what will be popular with the by then 40 year olds who have been crushed their whole lives, I think forced wealth redistribution is going to happen, it’s very likely, it’s in the figures really. it won’t be called that, it will be given a better political name like ‘reduced taxes for the under 45’s” while hiking taxes for other age groups. 

I don't know if the intergenerational tax realignment would be done quite so explicitly along age lines as that but I can imagine changes like merging national insurance into income tax so that landlords and pensioners pay the same marginal tax rates as workers.

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10 hours ago, kzb said:

Earlier posts were full of hate speak and you know it.  Watch your English or Monsieur CC will be onto you.

No they bloody well were not and you are dragging around for something to justify your little strop.

As said you made out @jiltedjen was living a fantasy of victimhood and you've now said how you are the victim of 'hate speech'. Please get over yourself because anytime someone disagrees you seem to go off into a tizz of whatabouttery and throw out a load of things, which when taken apart cause palpatations of victimhood.

I'm sorry but you are no longer worth conversing with as we've had a full circle of this now and it comes down to 

You have two unsquarable circles - house prices are too high now but somehow they haven't disadvantaged the younger gens by being too high for a long time.

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28 minutes ago, Dorkins said:

I don't know if the intergenerational tax realignment would be done quite so explicitly along age lines as that but I can imagine changes like merging national insurance into income tax so that landlords and pensioners pay the same marginal tax rates as workers.

its not a bad start.

I think they will have to go pretty far to bribe the by then 40 somethings for their vote.

the problem is the tank is empty in regards to selling things off etc, its all been used by previous generations.

they will have to go after wealth, houses, old people basically, in order to make it tasty for the young.

They will have to reduce tax for the 40 somethings age groups, give hand-outs, perhaps rearrange the old age care system into a two tier state system. Private and NHS, but the NHS one being done on mass and very very cheap, (withdrawn at certain thresholds of care are met) and private ones paying for it all via massive taxes, plus the hand-outs for the 40 somethings, possibly the whole thing will be spun under being 'fairer and kinder', tax the unfair un-funded pensions, or called 're-alignment of the economic reality'.

perhaps this will happen by a back-door way, that wealth will be driven by bitcoin as an asset store, and houses and housing wealth will just buy less and less, thus the same result of the old getting bod standard care, while the young get very rich (as the old peoples pension funds buy in very vary late into bitcoin) - an effective brutal wealth transfer 

The 40 something will be voting with the 20 and 30 somethings at the time, and it will eventually reach a pivotal point when policies suddenly change, to mass house-building, max taxing the old etc etc. 

I wouldn't be feeling as smug being a boomer knowing the future will be pretty dark, and honestly that's not nasty coming from a millenial, our existence is pretty dark as it stands! 

It may seem extreme and brutal, but that's how the crushed generation who have only known a hard existence will vote, we didn't break the social contract like the boomers did but we will play the same game  

It wont just be the boomers mind, it will be cracking down on tax havens etc, we have the technology to prevent it now with blockchain etc, but the will is not there as those in charge are benefiting from it not being there. 

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Not sure the boomers are at fault at all, they just happened to be alive when assets were cheap.  Since then the quantative easing and voodo economics have pushed asset prices through the roof.  Million pound houses are to be found everywhere.  The narrative that the government should now take from one part of the community and give to the other is not a solution but also very typical of people today.  Rather they should be solving the problem of rampant inflation and lack of decent housing.  The current setup of annual growth based on debt and imported cheap labour is not working.   I do believe there will shortly be the mother of all crashes as the lack of real jobs and real wealth creation comes home to roost.  And roost it will.  

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9 hours ago, kzb said:

Also, the biggest thing we could've done to alleviate the situation is control immigration.  Do you agree with that?

Bingo next whatabouttery session - not me guv it was immigrants

This is why I say its not worth engaging with you anymore as you chuck out as many tangents as possible. A thread about intergenerational equality and don't you think a distro by age might just include immigrants as its by age not country of origin.

I'm sorry but this reads like trolling or an attempt to wilfully derail a thread because everything you've posted has been picked apart. That's why I shall be ignoring you as its not a convo on facts anymore its a conclusion you have you are trying to fit facts to backup.

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The debt that flowed into the western economies in late 1990s, and eventually pushed up asset prices, served a purpose. It was needed to passify western voters, to maintain a standard of living they had become accustomed to, as the economy became globalised and their real earnings stagnated. 

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10 minutes ago, satsuma said:

Not sure the boomers are at fault at all, they just happened to be alive when assets were cheap.  Since then the quantative easing and voodo economics have pushed asset prices through the roof.  Million pound houses are to be found everywhere.  The narrative that the government should now take from one part of the community and give to the other is not a solution but also very typical of people today.  Rather they should be solving the problem of rampant inflation and lack of decent housing.  The current setup of annual growth based on debt and imported cheap labour is not working.   I do believe there will shortly be the mother of all crashes as the lack of real jobs and real wealth creation comes home to roost.  And roost it will.  

Mass house building and taking apart the banking system as it stands is required, and that needs political will, and that needs votes, we can’t get the votes now as the boomer vote for their own interests not for their own wealth destruction, but eventually we will get votes for the required changes in 10 years time. 

bottom line is that HPI is will get a lot worse, bubbles bigger, more generations crushed, then perhaps a blow off top around 2029 leading to a darker political right wing landscape as the younger half of the population get more and more angry.

 

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7 minutes ago, longgone said:

2029 blow off 🤣

Down south im expecting that 2022

When things are not allowed to fall the only failure mechanism is an insane blow off top. 

governments won’t let stock market or house price falls, so instead we get bubbles and insane tops to the point that even the most bullish person can see it’s gone too far 

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11 minutes ago, jiltedjen said:

Mass house building and taking apart the banking system as it stands is required, and that needs political will, and that needs votes, we can’t get the votes now as the boomer vote for their own interests not for their own wealth destruction, but eventually we will get votes for the required changes in 10 years time. 

bottom line is that HPI is will get a lot worse, bubbles bigger, more generations crushed, then perhaps a blow off top around 2029 leading to a darker political right wing landscape as the younger half of the population get more and more angry.

 

The best think to do would be to build several new cities, personally I place them in the North of England, south west and the midlands.  They should be equipped with industrial estates and all the houses be preapproved with planning.  I’d also have the government come in and buy sections of London and level the lot and replace them with large apartment blocks.  The problem of course is that this may pull people out of other areas. My solution would be to turn those areas over to nature and compensate the owners.  I can’t see any government being able to do all of this but it would be good to try one new city.   Shift all the millennials in there and see what happens.  It was done by previous generations with mixed results but the demand now is very high.

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7 minutes ago, jiltedjen said:

When things are not allowed to fall the only failure mechanism is an insane blow off top. 

governments won’t let stock market or house price falls, so instead we get bubbles and insane tops to the point that even the most bullish person can see it’s gone too far 

There is no more room down south to go up.

1 bed flats 400k ?? 3 bed semis 800k

Detached 1.2m up

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3 hours ago, Dorkins said:

Unemployment which I'm sure was very painful if you happened to be one of the 1 in 10 who were out of work for a significant length of time in that 1981-1997 block but if you were in the 9 in 10 it was a period of increasing real wages and rising homeownership.

The official stats understate the true level of unemployment.  Also it was very much concentrated in the traditional heavy industrial areas of the north and midlands.  Apparently down south it was a good time for white van man.  But you are making fun of a serious blight on millions of lives.

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4 hours ago, Dorkins said:

For example, when my mother was approaching retirement age a few years ago she rounded up all of her old occupational pensions and found she had one from when she worked in a big corporation for a year after graduating in the 1970s. The value of this pension is over £1500pa now, for literally 1 year of work as a 21 year old new starter with zero experience. Today's 21 year old recruit might chuck in, say 10% of £25k including matching contributions into a defined contribution pension, so about £2.5k going into the pension pot. At a 4% drawdown rate that £2.5k is worth about £100pa. Even if you take into account a real return on that initial £2.5k of say 2% over 47 years that only beefs it up to £250pa, still just one-sixth of what a 1970s worker could get. Also my parents bought their first house in NW London as recent graduates in the mid-1970s whereas their 2021 equivalents would most likely be renting in shared houses for pretty much their entire 20s, yet another huge gulf in asset price accumulation.

This doesn't add up.  She must've had a huge salary for a new starter.

The best accrual rates that I've seen are 1/60th of salary.  More usually it would be 1/80th (I seem to recall you a lecturer?  If so you will know this from your own USS scheme).

So to get £1500 p.a. for one year of service she must've earned the equivalent to a salary of £90,000 p.a. (1/60th) or £120,000 p.a. (1/80th) at today's prices.   So if she does get that £1500 p.a, she must've been in the top 0.01% of earners that is all I can say.

(What I suspect is that the £1500 includes a one-off lump sum, payable in the first year only.  You will know about this if you are in USS.   If she earned a more likely salary, e.g. £25k at today's prices, the pension would be only £417 p.a. at best)

Anyhow, if you think you are taxing my modest pension pot so you can buy a million-pound property in Hackney you can p**s off.

,

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4 hours ago, Young Turk said:

Is another significant factor the increase in the proportion of adults who work (i.e. more women remaining single longer and continuing/returning to work after having children)?

If you earn an average salary, there probably isn't much left after childcare. A lot of the net financial benefits of the move to two income households goes to high earners, capital and the owners of the assets (i.e. houses) which are bid up as two income households can borrow more to buy them.

Well, bear in mind that plot is GDP per capita, and capita includes women.

But yes, double income has certainly allowed a lot of HPI.  Maybe we should go back to the old system where only the male earnings counted towards how much you could borrow?  Imagine the storm of outrage if that came back....

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