Fannie Mae & Freddie Mac - the big bailout?

[Eomer]

So what's your response to game theory studies that have shown that the endpoint of extreme capitalism and socialism is pretty much the same thing: all of the wealth concentrated in to a very select number of individuals.

[Etoille]

Originally Posted by Eomer

So what's your response to game theory studies that have shown that the endpoint of extreme capitalism and socialism is pretty much the same thing: all of the wealth concentrated in to a very select number of individuals.

Life is all about one thing. Just one.

Expectation management.

The reason socialism fails is that it mismanages people's expectations. It tells them that people will work together for the better of the common good. People are disappointed when it doesnt work or when people game the system. This is why people decry communism because they feel like they've been cheated.

The reason capitalism works better (note i didnt say works) is because it manages peoples expectations so theyre more comfortable with the idea of being fucked over because they know about it ahead of time. People expect to get cheated so theyre more comfortable with the concentration of wealth in a capitalistic fashion.

[Lyrical]

Originally Posted by GrobbeeTrull2.0

Recessions are a way for the wealthy to get more wealthy, and the poor to get more poor.

Consolidation of wealth is the natural consequence of the boom and bust cycle of Capitalism.

That's retarded. I started out as poor as everyone else, making lower-middle class wages and not having much money. When I first started working, I literally had to make tradeoffs to invest. I didn't think I had enough money to pay my bills, but in reality, I needed to prioritize what I spent. On the surface, it looked like I couldn't afford to keep the lights on. But what I really needed to do is have a budget. Maybe I didn't go out drinking every night two or three nights a week like every else our age did. Maybe I didn't go out to lunch every day at work. You'd be surprised how much you can save by just cutting out dumb stuff. Maybe we didn't need cable TV, rabbit ears would be OK. Maybe the neighborhood we settled on wasn't the nicest. Maybe we had to live in a shoebox apartment. But we always knew we could put away a little to invest and bust our butts at work and get promotions. And so on and so on.

You aren't going to sell someone that was born Black in the US, and born dirt poor in the same neighborhood as Amsterdam on "The Wire" that recessions just make the wealthy wealthier and poor poorer. When I was growing up, you didn't know if you'd make it to school alive. When we were poor as hell, we still budgeted and found ways to buy more stuff in recession. Even if $50 was all we could afford to invest that month, we put it away. Maybe you eat less that month, but you better put something away for the future.

12 years later, my family has done well because we bust our asses on the job and invest. Our HHI is probably higher than 97% of all American households. We've gone from probably making the what the bottom 15% does to making what the top 3% does. And both me and wife came from poor as hell neighborhoods. And we are both Black.

In America, you get out what you put into it. None of our co-workers can outwork us.

You are going to have a hard time convincing my wife who was born in a family of five that lived below the poverty level for decades, but now she makes $70K a year in that you have to be poor all of your life. And you aren't going to be able to tell me that it is impossible to get out of poverty. In a twelve year career, I managed to work up from making lower-class pay to making six figures+. Did I have to work during the day and go to school at night? Yep. Did I have to work my way and earn an undergraduate and graduate degree? Yep. Did I have to have some sort of faith? Yep. I worked 18 hour days for many years to try to earn a better lifestyle. The bottom line is that someone at work needs to be the boss. I can sit around making 2K a month, or I can go to school, and I can out hustle everyone, and become the boss.

So you can continue to tell us how impossible it is for poor people (and minorities) to get out of their situation. And I will disagree with you on that forever, because we grew up dirt poor and Black, and we did it.

[Hachima]

Originally Posted by Lyrical

stuff

Since when did making it harder translate into impossible? You just proved it was hard in your post...so you are basically agreeing?

[Lyrical]

Originally Posted by Hachima

Since when did making it harder translate into impossible? You just proved it was hard in your post...so you are basically agreeing?

I was disagreeing that the poor have to get poorer, which is what he asserted. Having been dirt poor, I just don't get this mentality. Was it tough? Yes. But it makes the reward that much more satisfying.

[Kaio]

The lazy get poorer. In this economy you have options you can explore. You may have to train yourself a bit and maybe relocate but opportunities are available for a comfortable life.

Edit: There is no example of communism working better in practice. Unless you somehow think the middle class and poor starving in Soviet Russia or China to be a good example.

[Hachima]

Originally Posted by Lyrical

I was disagreeing that the poor have to get poorer, which is what he asserted. Having been dirt poor, I just don't get this mentality. Was it tough? Yes. But it makes the reward that much more satisfying.

Anecdotal evidence hardly proves that the overall idea is false though. There will always be exceptions. Did all of the poor people you associated with also climb and succeed as you did?

Do you think programs like forcing community service helps increase upward mobility or makes it harder?

If you had to do 100 hours of community service a year could you have "work during the day and go to school at night"?

I would say your schedule was already crammed, and having to do community service would have made it even harder for you succeed.

The same can go for other incentives too. That's where the mentality comes from.

Edit: Wrong thread but thats an example of poor getting poorer, and rich getting richer. (forcing community service on students)

[Tuco]

Originally Posted by Etoille

this is why people decry communism because they feel like they've been cheated.

That or because it starves people?

[Lefazz]

Originally Posted by Lyrical

So you can continue to tell us how impossible it is for poor people (and minorities) to get out of their situation. And I will disagree with you on that forever, because we grew up dirt poor and Black, and we did it.

An individual has to have ambition to do what you did. MOST people do not. And it's not a switch you can flip to just "be that way". It's a psychological trait that you either have or don't have.

Now, I'm not saying these types of people need to get hand outs. I firmly believe you get out of life what you put into it...it's just that most people aren't capable of doing it.

Anyway, you should be very proud of what you've accomplished. I wish I could do it, but I know I never will. Granted, I'm not dirt poor or anything but I know I'll never have anything more than an average income due to my own limitations.

[chaos]

Dude I came from poverty too. So did my cousins and my sister. They are all still there, I made it out, and it was hard and I had to work my ass off, and I still do. Hindsight is great and all, but it's not easy to overcome poverty. Sometimes circumstances just don't allow it.

[Lyrical]

Originally Posted by Kaio

The lazy get poorer. In this economy you have options you can explore. You may have to train yourself a bit and maybe relocate but opportunities are available for a comfortable life.

I agree, but with a caveat. Some people go about life with the wrong mindset. Its not just about being lazy, its about having some sort of positive attitude. I have a family member, who like me, grew up dirt poor. She moved away from a country town, and moved to a city. She worked as a secretary and went to school part time until she earned her degree. The problem is that she still has the poverty mentality. She goes to work with a bad attitude, argues with the boss all the time, and doesn't work hard. She's been fired just because she's been labelled a troublemaker - she's always telling people off. In her case, she got a degree, moved to a major city, and still screwed up. And she still can't make ends meet. No one wants to work with her and she can't hold a job down.

One thing I have noticed is that there are alot of poor people out there that spend waaaay more than they should. My brother-in-law, for example, has had to declare bankruptcy and now him and his family are on food stamps. He's on food stamps. That's not the bad part.

The bad part is that what little money he makes goes to the newest tech stuff. He's always the newest cell phone, computer accessory, computer system, video game, etc. And he just came to visit us on a vacation. Both him and his wife are unemployed and on food stamps, and yet they can go on vacation? I understand wanting to get away, but sometimes you have to face your situation. And they came to visit us, and went to all of the tourist attractions. How the hell do you spend that type of money and be on food stamps? He makes some really bad choices.

I have also worked in non-profit organizations, and one thing I have noticed is how many people that fit the poverty level, but then go spend their cash on frivolous things. I don't get it. I know someone who makes very little money, and has to choose between making payments to credit cards, or spending the money on shoes. She routinely spends money on expensive shoes, rather than pay her creditors.

There are a lot of poor people that don't budget what they have. As I have seen in my own life, knowing what your budget is and working at increasing what you net pays off. You can always save something, no matter how little you make. When I was broke, busted and disgusted, I had to look at creative ways to make my situation better.

[Lyrical]

Originally Posted by Lefazz

An individual has to have ambition to do what you did. MOST people do not. And it's not a switch you can flip to just "be that way". It's a psychological trait that you either have or don't have.

Maybe ambition is a trait, I don't know. I do know that while we grew up poor, my parents always preached about you "getting out of life what you put into it" and that "you can do anything you want" and that "life is tough, you want something, earn it" and that "no one owes you a thing." Eventually, my parents also moved out of the 'hood. They both earned graduate degrees and were able to get out of living in the lower middle class. By the time I turned adult, they had gone from not being able to pay the bills at all, to doing well. I still remember when we got our first apartment. It cost 13K a year in rent (we lived on the East Coast), and that was all that my Dad made in a year. I will never forget her crying when she found out that every penny they made would go to rent.

I can't ever imagine telling a child that the man is going to be able to hold them down. I have a cousin who all the time somehow manages to relay to his kids that the man is trying to hold them down and they'll never have a chance. He's convinced that as long as there is a Republican alive, that there's no use in trying to work above minimum wage. Also, earning a degree is useless, because the man will try to hold him down.

Some people give up before they even get started.

[Kaio]

Well, i kind of assumed people need to not be idiots too in addition to not being lazy.

That includes spending too much and not being able to function in a working environment. I actually don't mind annoying bitches being unemployed. They make the work place much more annoying and if your a client/customer a pain to deal with.

I think people just don't want to come out of poverty enough to do so. They don't study as well as they could in school, they spend more then they should, etc.

[chaos]

Originally Posted by Lyrical

Maybe ambition is a trait, I don't know. I do know that while we grew up poor, my parents always preached about you "getting out of life what you put into it" and that "you can do anything you want" and that "life is tough, you want something, earn it" and that "no one owes you a thing." Eventually, my parents also moved out of the 'hood. They both earned graduate degrees and were able to get out of living in the lower middle class.

I can't ever imagine telling a child that the man is going to be able to hold them down. I have a cousin who all the time somehow manages to relay to his kids that the man is trying to hold them down and they'll never have a chance. He's convinced that as long as there is a Republican alive, that there's no use in trying to work above minimum wage. Also, earning a degree is useless, because the man will try to hold him down.

Some people give up before they even get started.

Sounds like you had great parents. A lot of people don't. Take my mom for instance, a woman who admitted, in court at the custody hearing after her divorce with my dad, to using heroin while pregnant with my sister. She got custody of my sister. That's Texas for you. My dad was a decent guy, did the best he could and taught me a lot of lessons, and is my model for god (or so Tyler tells me). So we are raised by different people and have wildly different outcomes of our adulthood. Everyone lives up to their expectations in life.

[Lefazz]

Speaking of investing:

Is there any website or a simple formula that will let you input your current age, your retirement age, and X amount of money you want at retirement and have it show you what you need to invest every month to achieve it?