Friday, September 30, 2016

The unlucky generation? Certainly with respect to wealth

Children of Thatcher era have half the wealth of the previous generation

People born in the early 1980s are the first post-war generation to reach their thirties with smaller incomes than those born a decade earlier

Posted by tom101 @ 07:48 AM (7159 views)
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10 thoughts on “The unlucky generation? Certainly with respect to wealth

  • I wonder how the balance of things compares when you strip out mortgage interest and the cost of cheap Chinese crap. Obviously worse off as personal debt is high, but that much worse off? Weren’t income taxes higher back then too?

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  • And interest rates, something like up to 14.5%, my father once commented that 1970s inflation was the best thing that ever happened for average bloke on the street as well.

    Memories fade and this stuff is not taught to todays children so unless they have an inquisitive open mind they cannot produce a balanced comment on the subject.

    Real inflation screws those who have money more than those who do not, which is in turn reflected by the cost of labour hence automation, immigration, screwing of pensions, healthcare etc etc.

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  • Given that the economy is cyclical it is very possible that standards of living will begin to rise sometime. Unfortunately economic cycles pay no regard to human life cycles. You are either a luck or unlucky generation, with our grand and great grandparents arguably the most unlucky, suffering world wars. Certainly, the least lucky right now are Syrians and Libyans.

    In light of recent investment in plastic five pound notes and phasing out £50’s, do you think some people are anticipating massive deflation?

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  • Economies may have been cyclical but they’re no longer so. Stagnation is the future, at least for the 99%, for at least the medium term.

    It’s all about global debt deflation, QE, ZIRP and the consequent lack of investment in anything other than property, shares and bonds and government backing for banks.

    The article concentrates on a British generation but the problem is global and affects the 99% (although yes, it has hit one generation harder than another). There’s too much concentration on identity politics – populations divided according to age, sex, ethnicity, sexual orientation an so on and too little concentration on the 1% vs the 99% divide and increasing inequality. This gives a monster like Clinton the chance to say she’s with this or that group “for women’s rights” while cheating and lying and being the water carrier for Wall Street and the US military freaks.

    I don’t think luck has much to do with it.

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  • Icarus, I agree with you that identify politics are being stoked with the intention of distraction.

    And the wider generational issue, which is less to do with the older generation ripping off the younger. More to do with the fact that the economy for young people has nose dived worldwide due to mechanisation. But even that is cyclical, because mechanisation has limits and diminishing returns at a certain point where many now value hand made “artisan” “craft” products and will pay a premium for quality.

    I actually see that mechanisation is creating the spare time necessary for folk to re-focus on value added human trades, meanwhile drudgery is taken care of.

    The democratisation of mass production is also a new trend, with the miniaturisation of industry that began with the personal computer and will end in affordable 3D printing, i.e. manufacture at home, but beginning with co-working hubs where folk gain access to manufacturing tools on an hourly rate. This is happening more and more: http://buildingbloqs.com

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  • libertas – at least we agree about something.

    But in previous posts I’ve countered your “the economy for young people has nose dived worldwide due to mechanisation” argument without reply from you.

    If you’re talking about productivity growth read Robert J Gordon’s book “The rise and fall of American growth” which argues that the technological innovations in the century prior to 1970 (electricity, indoor plumbing, home appliances, motor vehicles, air travel, air conditioning, and television) transformed households and workplaces to a far greater extent than innovations since then. He says that the contribution of the internet was largely played out by 2005 and the wireless tech revolution that followed has had an even smaller impact on productivity than did the internet. He blames other developments too for the stagnating of productivity growth, including a poor education system. And indeed productivity growth has slowed to next-to-nothing. All ‘advanced economies’ have this problem. But he doesn’t mention the elephant in the room – offshoring of the most productive sectors, leaving behind low-productivity ‘service sectors’, some of them transformed into a virtually all-contingent labour economy. Part time, temporary, independent contract, and ‘gig’ or sharing economy employment has exploded. That too lowers productivity growth potential (and makes the estimation of productivity problematic). In Europe in recent years, contingent labor growth constitutes 70% or more of job creation in many countries…..

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  • Well, from what I can see, the internet has only just began transforming the way business is run.

    For example, I started using Xero a year ago, which automates my book-keeping, reducing my annual book keeping activities from a week’s work to about a day. I think this is happening throughout business chains.

    But I did state there that it has diminishing returns.

    I suppose the next leap forward is free energy.

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  • Mechanisation has not replaced all “low-skilled” jobs. Service jobs – cleaning, coffee shops, etc – are numerous, then there is horticultural (European labour). The problem of falling pay is largely to do with economic power in the hands of a few, abetted by right-wing govts. Maybe this new flavour of Tory will address that but I’m not optimistic.

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  • When land is expensive labour is always cheap…

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