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Post by Deleted on Feb 25, 2020 0:15:49 GMT
The ratio of single-income/dual-income households is wildly different than it was in 1985.
That has had a big effect on purchase decisions. Over time 'middle class' households with two incomes have been willing to buy a lot more car, to buy a lot more house and a lot more college.
The earners/decision-makers in the household have more to spend and have become increasingly more willing to spend.
Let's take house size as an example:
The average size of new homes built in the US grew 62 percent from 1,660 sq. ft. in 1973 to 2,687 in 2015, an increase of 1,027 or 62%.
The 'traditional family' model of a married couple with children and the man as the sole earner now represents less than 7% of the population.
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Post by lcjjdnh on Feb 25, 2020 0:30:39 GMT
Do you really think the median male earner in 1985 could cover these basics with only 30 weeks worth of work? I mean, shit ... in 1985 I made somewhere close to $15K. Per this chart I should have been able to afford to rent a 4BR house, pay for a family health insurance premium AND send a kid to college IN ADDITION to the car-related expenses I was incurring. Spoiler alert: No. Fucking. Way. The median income in 1985 was $23,620. Total cost of a public university was $3,682. Monthly housing costs for homeowners ... I found a HUD study that listed the median at $670. I'm inclined to trust it as it reflects 35 percent of median income. Healthcare ... I can't find an exact, non-inflation-adjusted number, but I think we can all take it as a given that that number has exploded more than any other. Cars, YMMV. So, I don't know if it could be done in 30 weeks. But it could be done. And as a gauge of shares of income, it illustrates if nothing else how crappy our statistics are that say median wages have increased and such. My understanding is that one issue with his study is that he uses the all-in total cost of health insurance when, even today, that’s paid in part by employer for majority of employees. College number also overstated for several reasons—you’d have years before child grows old enough to save for that, not all go to schools, etc. Education and health care are also areas, btw, that may suffer from Baumol’s cost disease. Wages rise in other industries because productivity improving. So in order to compete for talent education/health care industries (and, the classic example, string quartets) need to increase salaries even though productivity in these industries is not improving. This causes costs in these industries to rise faster than in other areas—costs are rising without any corresponding increase in productivity. Which is to say the increase in these expenses is, perhaps paradoxically, a sign of the success of the broader economy. |
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Post by lcjjdnh on Feb 25, 2020 0:35:08 GMT
The ratio of single-income/dual-income households is wildly different than it was in 1985. That has had a big effect on purchase decisions. Over time 'middle class' households with two incomes have been willing to buy a lot more car, to buy a lot more house and a lot more college. The earners/decision-makers in the household have more to spend and have become increasingly more willing to spend. Let's take house size as an example: The average size of new homes built in the US grew 62 percent from 1,660 sq. ft. in 1973 to 2,687 in 2015, an increase of 1,027 or 62%. The 'traditional family' model of a married couple with children and the man as the sole earner now represents less than 7% of the population. I also think restrictive land-use and educational policies has something to do with this. People want to live in “nice” areas with good schools, but there’s a limited amount of housing available there. (And perhaps area wouldn’t be so nice if there was not.) If families now have two incomes instead of one it’s going to bid up pricing of housing in that area even though there’s been no improvement in the underlying good. |
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Post by Deleted on Feb 25, 2020 0:35:14 GMT
The ratio of single-income/dual-income households is wildly different than it was in 1985. That has had a big effect on purchase decisions. Over time 'middle class' households with two incomes have been willing to buy a lot more car, to buy a lot more house and a lot more college. The earners/decision-makers in the household have more to spend and have become increasingly more willing to spend. Let's take house size as an example: The average size of new homes built in the US grew 62 percent from 1,660 sq. ft. in 1973 to 2,687 in 2015, an increase of 1,027 or 62%. The 'traditional family' model of a married couple with children and the man as the sole earner now represents less than 7% of the population. The average household income in the U.S. was $23,618 in 1985. In 2018 it was $63,179. That's an increase of 168 percent, or roughly 4.4 percent per year. How do you think that compares to the trend line for college, healthcare, housing and cars since then? |
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Post by doctorquant on Feb 25, 2020 2:37:19 GMT
Do you really think the median male earner in 1985 could cover these basics with only 30 weeks worth of work? I mean, shit ... in 1985 I made somewhere close to $15K. Per this chart I should have been able to afford to rent a 4BR house, pay for a family health insurance premium AND send a kid to college IN ADDITION to the car-related expenses I was incurring. Spoiler alert: No. Fucking. Way. I'm skeptical, but then I wasn't a "median male earner" in 1985 and I suspect neither were you (if we're close to the same age). In 1985 I was two years out of school making almost $17,000. It seems the "median male earner" was a few years older and making about $23,000. NEVERTHELESS . . . In just 2.5 years of work at a salary of $12,500-$16,500 before moving to Fort Lauderdale in January 1986 I had managed to save $8,000. And I'm assuming there's a "median female income" somewhere helping to support this family of four, although the chart fails to acknowledge such. Oh I was nowhere close to median in 1985. But per that dude’s graph even at my lowly place (approx. $13K IIRC) I could have come close to squeezing those things in. And that’s a crock. I had no debt. No kids. A reasonably secure job with benefits. But although I was desperately into skiing then, to go I had to have one of those 3-paycheck months. That was the only way I could scratch up the $60 I needed to go. Now they tell me I could have lived in a 4BR house and put a kid through college. Shit, who knew? Had I known I was so “of means” my social life would have been fabulous! |
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Post by doctorquant on Feb 25, 2020 2:38:34 GMT
The ratio of single-income/dual-income households is wildly different than it was in 1985. That has had a big effect on purchase decisions. Over time 'middle class' households with two incomes have been willing to buy a lot more car, to buy a lot more house and a lot more college. The earners/decision-makers in the household have more to spend and have become increasingly more willing to spend. Let's take house size as an example: The average size of new homes built in the US grew 62 percent from 1,660 sq. ft. in 1973 to 2,687 in 2015, an increase of 1,027 or 62%. The 'traditional family' model of a married couple with children and the man as the sole earner now represents less than 7% of the population. The average household income in the U.S. was $23,618 in 1985. In 2018 it was $63,179. That's an increase of 168 percent, or roughly 4.4 percent per year. How do you think that compares to the trend line for college, healthcare, housing and cars since then? For college and healthcare ... sticker price or actual? |
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Post by btexpress on Feb 25, 2020 2:54:19 GMT
Cars are tricky, because while they are more expensive . . . the quality is FAR better.
I mean, if you're paying slightly more (inflation adjusted) than you were paying in 1985, but your car gets 2-3 times as many miles --- with the added safety, convenience and comfort benefits --- I'd say that's a pretty good deal.
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Post by btexpress on Feb 26, 2020 15:51:36 GMT
Well, those were the most butt-ugly taxes I've ever filed.
Owe the federal government $1,061 . . . despite dropping $9,122 into the 401(k). Even got hit with a $7(!) underpayment penalty. Kick in the groin is that we made $140 too much to qualify for the $200 Retirement Savers Credit.
But I get a refund on my state taxes --- $45!
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Post by lcjjdnh on Feb 26, 2020 18:02:32 GMT
Even the liberal Vox hating on this chart.
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Post by lcjjdnh on Mar 12, 2020 13:20:47 GMT
Torn on this: not a fan of eminent domain, but we also should not subsidize people who live in flood-prone areas. (And so they should be thankful government is buying properties at market rates that assume the availability of such insurance rather than what homes would be worth if government didn’t provide it.)
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Post by doctorquant on Mar 18, 2020 15:33:54 GMT
If you had some money to invest now or in the near future, what would you do? Plow it into the stock market? Use it to take out a mortgage and buy a second home (or investment property)?
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Post by doctorquant on Mar 29, 2020 19:18:51 GMT
This is so-and-so. So-and-so says he bought a car recently with 0% financing. So-and-so is a moron. Don't be like so-and-so.
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Post by Deleted on Mar 29, 2020 19:32:09 GMT
This is so-and-so. So-and-so says he bought a car recently with 0% financing. So-and-so is a moron. Don't be like so-and-so. 84 months is the best! |
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Post by doctorquant on Mar 29, 2020 19:39:31 GMT
This is so-and-so. So-and-so says he bought a car recently with 0% financing. So-and-so is a moron. Don't be like so-and-so. 84 months is the best! The 0% financing thing ... sheesh ... Apple can't borrow money at 0%, but people really think they're gonna get to? |
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Post by ecwyanks on Mar 29, 2020 21:56:14 GMT
The 0% financing thing ... sheesh ... Apple can't borrow money at 0%, but people really think they're gonna get to? After 9/11, I got 0% financing for 48 months, put down half. If you're credit is 800, in NY and NJ right now you can get 1.9% over 48 or 60 months at several dealerships. |
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