Topic: I think the concept of saving has been lost with this generation. (Read 2786 times)

Saving is fine, but it has to be done in precious metals (or now, cryptocurrency) rather than fiat, obviously. Otherwise you lose your money.

There are no incentives to save anymore. Here is a short list of what I mean:

• Inflation makes your savings worth less every year (as opposed to deflation on the gold standard)
• The government will cover your retirement in the form of Social Security so no need to save for retirement. Or so people believe.
• Low interest rates entice people to acquire lots of loans.
• Bankruptcy laws make it easy for someone to acquire lots of debt and then default on them and walk away clean
• No financial education in public schools

Just to name a few.

I suspect "correct" answer #1 was to liquidate a little bitcoin and buy a cheaper used vehicle. Correct answer #2 would have been to do the same with borrowed money rather than case in everything bitcoin. Exchange the order of these based on your aversion to debt (Though I believe money was borrowed to buy the bitcoins in this case which clouds the issue).

However, the simple fact is that Rassah wanted a shiny new car, had the funds to do so, cashed out, taking good profit and got something he wanted and paid off some debt to boot (I believe). There is nothing wrong with that in my book.

I can think of a lot of things that have a better than 15% ROI. Dumping liquidity on a car is a poor investment. In fact, leasing a car is probably a much better idea. In the case of Bitcoin, it's like throwing away three cars for the price of one when we are seeing a 300% or higher performance every year.

Presumably the car is a sunk cost, and necessary for driving to work and going to the grocery store. Borrowing at crazy low interest rates for cars (sub 3%) is usually a better financial choice, assuming the borrower believes he/she can obtain USD easier in the future, to keep up with the deflation of the dollar. Of course, that's a gamble, but it's not a particularly bad one.

You would borrowing money to buy a depreciating asset?  The average depreciation for a car is 15% a year.  That is like borrowing money in USD and holding it when it has an inflation rate of 15% a year.

This is the fallacy of special pleading. We are living in a unique time in history when scammers are able to bilk fortunes without penalty. It has not always been like this, in fact, it hasn't been like this since the Robber Baron age of the 19th Century. After we start punishing the thieves that caused the economic collapse, we'll need a currency that brings balance back to the economy.

I'm not saying that capitalists cannot get rich with executive skills. I'm just saying that people should be able to save liquid assets like money as a store of value. In fact, banks themselves should be incentivized to pay compounded interest through the privilege of Bitcoin deposits if they earn the trust of depositors.

Bubble economics is the sign of the end of a civilization. Enjoy it while you can, but what will your skill set be when it is gone? What place in society will you have? None in mine.

Nobody ever got rich through hard work alone.  Making money is all about controlling capital. Money is poorly correlated with work.  Why does a quantitative analyst earn 10 times the salary of a physics professor, even when they have similar skills, and even when a physics professor's job is 10 times more intellectually demanding? It's because the quantitative analyst controls a huge amount of capital and the physics professor almost none.  

It has always been like this, but this generation is more aware of it. If you have a friend who makes easy money in finance, real estate, or whatever the next bubble is going to be, then you are going to think, why should I bother working my ass off as a teacher so that I can save $200 a month?  I want to have a good life too. Fuck the future.

The fact that savers are being punished by governments and debtors rewarded aggravates the situation even more.

  

+1

I feel very sorry for those who are retired or close to retiring that "saved."  They'll make maybe 30-100bps on that savings, significantly less than inflation. 

I'm not advocating people going into debt or spend foolishly, I'm just saying ZIRP is terrible monetary policy.

They consented themselves   And the trend hasn't changed as far as I've seen.

Where did slave owners get the power to force people to pick cotton without their consent?

Where did George Washington get the power to impose a tax on the Appalachian corn farmers?

Where does the mafia get the power to shakedown store owners?

Governments impose themselves by force, not by citizen consent.

zing.

[devil's advocate]
Why save when the future is so unclear and I can get credit?
[/devil's advocate]

The title of this thread reeks of blaming the victim.

The concept of saving was punished out of existence by central bankers.

lol, this says it all really...

I agree with the title, but disagree with the post.
How the average person my age treats money is depressing to me. They go into debt for stupid status-seeking trinkets, don't save or invest, and rely on others for their retirement and hard times (if they think about such occurrences at all). But, I don't see that as a sudden break true for this generation only. It's been so for the last few decades at the least, perhaps a century back depending on how you look at it. It just gets a little bit worse as time goes on, so as one gets older it's noticeable in the younger generation, but self-examination for such traits isn't considered. In short, whatever undesirable tendencies you're seeing have been a long time coming.
That said, I don't consider people using bitcoin or anything else as an investment vehicle part of that group. I don't distinguish between 'saving' and 'investing.' What is commonly referred to as saving is just a more passive form of investing with a longer timeframe, lower risk and lower reward. There's nothing wrong with that strategy, and there's nothing wrong with a shorter-term, higher-risk/higher-reward one. It's just a matter of preference and life situation. Younger people benefit more from short-term strategies that would destroy a more established set of finances. To say that that means the younger person is being fickle is to try to judge the rain for falling. To be investing in any form, short or long, at this age and with such low real incomes compared to the past is laudable and should be celebrated, not scolded.

Debt based monetary system do not allow saving, one man's saving is another one's debt, you have to spend every dollar you earned to keep the balance of whole society, only man allowed to save is central bankers

Bitcoin bring the possibility of saving back

Although bitcoin is still an "experiment", I'd trust it more than any other sovereign currency on the planet right now. Especially since the G20 met to make sure nobody debases faster than any other country. (Which means of course, they will all attempt to do so, posthaste.)

I'll take an algorithm over a politician, any day.

There is nothing wrong with saving or spending by itself, what's wrong is getting in debt and fucking about with other peoples money and then getting in even more debt which is why we're in this mess in the first place. I'm well aware of how to save, in fact I'm looking forward to being able to save for the low low prices that Bitcoin provides because of its deflationary nature. You'll find that this generation is actually pretty damn open minded and I find I get along with people my age most of the time, much better with people younger, the people I do have a problem with are the baby boomer generation because they wilfully bankrupted their countries and their children ( which is what devaluing a currency does ) for the sake of benefits, pensions and wars to gain more resources.

The stock market can actually be a viable force for the economy, much like banks, in fact you could argue they work better than banks in some ways for their purpose because the people giving money actually own portions of the companies they invest in, what we need is a properly decentralized version for Bitcoin that isn't rigged in the blue chip companies' favour.