Millennials earn 20% less than boomers—despite being better educated (12/12/2019) ~ Economics

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Labor Bargaining power is a lot weaker than 30 or 40 years ago.


This article is damn near click bait.


Yes western millennials. Places like India or Asia however, millennials earn many times more. Thank globalization for that.


Define “better educated”. You could argue that someone with master’s degree is technically “more educated” than someone with a bachelor’s degree or an associate’s degree. But what if I told you the first person was a high school teacher with a master’s in English, the second has a bachelor’s in electrical engineering, and the third had an associate’s from an aircraft maintenance school. Which of them is “better” educated? “Better” educated has to translate to market value. Right now the market is awash with relatively easy to get bachelor’s and even master’s degrees. To be valuable, you still have to stand out, and bring something employers need and want.


Because everyone has better education. Its a simple demand and supply situation.


Sketchy dude sending me way too much money in exchange for my old drum kit. (12/12/2019) ~ Personal Finance

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It's a scam. The check funds will be made available to you (in compliance with federal law), and then the check will eventually bounce (since federal law prescribes a longer timeframe for that), and you'll be out the money you paid to his "shipper".


It’s a scam. That’s what it is, the entire check is going to bounce. Ignore and move on.


This is a common scam. The check takes a few days to clear, so in the meantime, he'd ask you to send $2000 over to someone for some fake reason. Then, by the time the check bounces, you're out $2000 and the scammers are long gone. I have enjoyed stringing along these scammers though, if you're in the mood for that 🙂


It's a fake check. Tear it up and find a real buyer.


This is a common scam. There are laws where your bank has to release the money to you within X days. So he mails a check from like some African bank that talks to some European bank that talks to a NYC bank that talks to your bank. It'll be like 10+ days before it *actually* clears. But due to laws, your bank will give you the cash much sooner. Meanwhile, you see his check "clearing" and mail him the drums + give him back the $1-2k you didn't need on shipping. He cashes your money almost instantly, because your bank is a normal ass bank and you have the money. You find out a week later the bank reverses his money because he never had any money. And you lose the drums plus $1-2k. edit: typo


A woman opened a credit card in my name at Kay Jewelers and purchased a $6,000 bracelet (12/10/2019) ~ Personal Finance

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Freeze your credit dont just put an alert on it


File a police report for identity theft showing the officer the information you have. You can usually call and have a patrolman stop by to take your statement. It costs money to get a copy of the police report so just take down the police report number and provide it to any and all involved companies. They’ll get the report for free and will sometimes provide a copy, although you don’t really need it. Once you do this and provide the police report number the companies act completely different. Freeze your credit on all three bureaus and only unlock temporarily when you need to. Also file the information with the credit report who will remove the credit card information from your records. They’ll likely point you to a specific government website created to file identity theft cases. The same thing happened to us so good luck!


Kay Jewelers is owned by Sterling Jewelers (parent company Signet), they’re headquartered in Ohio. Call Sterling jewelers directly as their credit cards are their own and they do not use an outside credit company.


I found it funny that Equifax wanted to sell you a product and soon as you did not want to buy the product they don't have enough information to identity you. That is why people hate these credit bureaus. They are shady af. Some they were willing to sell a product that would let someone access your credit file when they claim they cannot identity that someone? Please. Also your instincts are correct. Do not believe the jewelry store. They will just sell it as bad debt. There insurance will cover the difference and you will have do battle with some scummy collector that will say you have to prove it was not you. They will probably make you send in the police report.


This is amazing, Walmart sent me a letter stating someone had tried to do this and apologizing if it was in fact me but they said it looked “anomalous” and they had to deny them credit.


Just got hit with a $90,000 hospital bill… EVERYONE told me it would be covered (12/13/2019) ~ Personal Finance

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So you need to write a letter of appeal. You will need medical records showing your headaches and everything else you can dig up to blame on the condition. Find out what the exact appeals process is. It probably lays it out in the letter you received. You can also have your surgeon get involved and do a peer-to-peer with an MD at BCBS. Find out if anyone (the surgeon or the hospital) obtained a pre-authorization. If so, call BCBS and find out why they denied it when there is a pre-auth. It might not get the claim paid but it will buy you some time to get the argument of your life together. In you appeal, include who you spoke with at BCBS who told you it would be covered. The goal of your letter is to prove you had to have the surgery because the condition was causing medical problems you couldn’t live with. If you ever lost a job, say it was because of the headaches. If you ever failed a class, it was because of the headaches. You get the idea.


As someone else said, sick your surgeons billing office on them. They want to get paid and know you won’t be ponying up that cash.


Hey OP, I had jaw surgery five years ago. I also had BCBS as primary insurance. This is probably not a first for your doctor. Their office has more than likely perfected the craft of appeals for this kind of thing, give them a call. All they need to do is show malocclusion of x millimeters (they use the casts) and provide a write up as to why that impacts quality of life and can lead to problems in the future. If you had braces to correct your teeth prior (which I had), the malocclusion actually gets worse and is even more in your favor. My doctor actually submitted a detailed report when the insurance requested more info. I received an approval a week later and had surgery a month after. That's extremely interesting that the doctor went ahead with the surgery, did you have a pre-approval for it in place? My office wouldn't do a thing until they had it. Edit: I also want you to know it's the single biggest thing that's ever changed my life. Look at the positives. Edit 2: WOAH, Thanks a ton for the gold and platinum! This was my first for both!


Moving forward, everytime you talk to someone at all related to this no matter which company or entityyou talk to, make a record of NAMES, DATES and TIMES. So if they fight you, you can say "X person told me on X day that the procedure would be covered."


That doesn’t sound right, but sadly it wouldn’t surprise me either. Did the letter state a reason as to why it would not be covered? Is the specific doctor who did it in network? Edit: Also, I’m not a doctor but $90k seems unreasonably ridiculous for a surgery that sounds like it went well and had you in and out of the hospital. Wtf. For comparison, I had a gallbladder removal that was done incorrectly, a month hospital stay, collapsed lungs and other issues and surgeries needed in that month and my bill at the time was around $150k before insurance. But That was for an entire month. Yours doesn’t sound near as complex to the point where it would be $90k.


Girlfriend’s job’s checks have been bouncing (12/11/2019) ~ Personal Finance

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File a complaint with your state government’s labor division. And then start looking for a new job.


When a company does this once, it is time to leave immediately. Whatever their excuse is, it usually means that they are going to be bankrupt soon and that someone is cooking the books or that they just failed as a business in general.


At that point she's volunteering there, not working. She should have a talk with the owner and if he/she doesn't gave her her money (not a cheque) she should leave.


> Can she sue and win? Absolutely, especially if she has good documentation: time card entries indicating when she worked, and bounced check documents. But really, she needs to GTFO of that place. I've been to Chicago, and I seem to recall quite a few restaurants there. Work at one that doesn't bounce paychecks.


Businesses in trouble always pay their employees and their taxes, because you can get a long ways down the line of near-bankruptcy before those two things start going badly, and those two things bring legal trouble. Once they start failing on one of those two things, the company is fucked. They've been a zombie for months, but now they can't hide it any more and the legal trouble they'll face doesn't matter because they're done. Take this as a very important sign. Your girlfriend is not working. She's spending her time pretending to work, for free. There is no expectation of pay any more. If she continues to go in and do her "job", she's only fooling herself.


I just discovered that the dryer in my basement that is used by all 3 units is hooked up to my electric. I was never made aware of this. Is this normal? (12/10/2019) ~ Personal Finance

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No, it is not normal. You should call the land lord about this.


So my sister in-law had this situation except it was a water heater. It happened that the breaker for it was in her unit. I told her to turn off the breaker. It didn’t take long for the other tenants to call the landlord at which time gave her the opportunity to tel the landlord she wasn’t paying for the others to have hot water.


I work for an electric company in the Pacific Northwest We do not allow mixed loads, call your electric company and they'll do a space check. When it's determined that there's a mixed load, your bill will be put back in the owner's name until the metering issue is resolved. That's what we do here anyway.


Not normal at all. You should not be paying for the other units. I might suggest to the landlord that you should get your bill discounted by the amount of electricity that the other units are using. An electric dryer uses lots of power. Should be able to tell by comparing electric bills to the other units.


No, this is a bunch of bullshit. It needs to be hooked up to the building's electric (same that powers the hallway lights, for example.) Get your landlord to fix it. At the very least, have them reduce your rent $x/month to compensate.


Almost fell for a gift card scam! Be careful, friends. (12/9/2019) ~ Personal Finance

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Tell your IT department. They should have filters to intercept these scam emails. Amazing how many people fall for these. Good job!


I had this happen to me last year. It also came from my bosses boss and said "Do this now". They know your companies org charts and email structure. I emailed my guy all day long and kept stringing him along. Eventually asked him when he was going to tell his wife about us, and the baby.


I work at a law firm, and we recently got spammed with legitimate looking mails containing the "emotet" virus. From the subject and context you could not see that these were fake. Losing money is the least of your problems if you fall for a really bad attack.


Damn scams are getting smarter aren't they. If my boss emailed me to go buy GC I don't think I'd hesitate for a second. Lucky for you their greed was too much and you caught on. Edit: " If my boss emailed me to go buy GC I don't think I'd hesitate for a second" I should have clarified, in my position I do a lot of odd errands and shopping for the office/ company. With a company CC. So my boss asking me to go bug CG isn't that weird and I would not have been using my own money to do so. But 5 for $200 would defiantly be a red flag since my monthly limit is about half that.


What is the goal of this scam? Were they going to ask you to send those giftcards or something?


‘It’s really over’: Corporate pensions head for extinction as nature of retirement plans changes (12/10/2019) ~ Economics

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I wonder (as a millennial) what it must have been like as a boomer or older, to work at the same job for 30 years, retire with a nice pension, own a house that the company helped you buy, etc etc etc


" nature of retirement plans change." Skipping out on paying pensions shouldnt be considered a nautural element for companies.


Long term employer employee relationships are a thing of the past, business loyalty is slowly becoming a remnant of the past due to the ridiculous rate of globalization happening. Everyone is replaceable (barring specific fields), company pensions just don't make sense for all companies anymore.


If the last 20 years have proven anything it's that you can't trust companies not to file for bankruptcy protection and try to dismiss their responsibilities in court. Don't ever trust your employer promise of a pension unless you're in the government.


good. Im not sayin 401ks are the end all be all, but they empower the employee and no matter what happens to the company its theirs.


Been with my bank (USAA) for 15+ years. Got a letter saying they are closing all (4) of my accounts. (12/11/2019) ~ Personal Finance

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Due to the stream of rule-breaking comments the post was receiving, especially politics and personal attacks, the moderation team has locked the post from future comments. This post broke no rules and received a number of helpful and on-topic responses initially, but it unfortunately became the target of many low-quality comments.


I have worked a department at a large bank that initiated these type of closures and there are likely multiple layers at work here. First off the people that you are talking to dont know why your account is being closed. The back office groups that make these decisions will not share that information with any customer facing employees. Why? Because (at least in my experience) these closures are caused by the bank filing multiple suspicious activity reports (SARs) on your activity. The bank secrecy act actually makes it illegal for the bank to disclose to the subject of a SAR that they are indeed being reported on. Because of this the people that do know are not allowed to talk to customers or to disclose information to front line departments. That is likely why no one will talk to you. I know this likely raises more questions than it answers, but you can be reasonably certain that you haven't been (and won't be) in contact with anyone who actually knows why this is happening.


Ex Banker here: Have you regularly been depositing or withdrawing sums of cash just below $10,000? This is called “structuring” in the banking biz. It looks like you are trying to skirt cash reporting requirements (10k+ cash transactions require a CTR) and might be a money launderer. If any bank sees this, they will end their relationship with you immediately, much in the same way USAA is ending their relationship with you.


Sounds like your name was flagged for money laundering or worse warranting immediate closures. AML or FIN crimes probably owns the decision, not the bank itself. Tbh I'm not sure how to go about it or if you'll get an AAN but definitely check any other accounts you have and your credit reports. All the big banks are getting reamed by the OCC right now for compliance issues so it's not entirely surprising something like this might happen. Edit - have you been out of the country?


Did you receive your USAA membership through employment, or military affiliation? If it’s the former, they’ve recently undergone a “clean up” of those that are no longer employed there and do not have military affiliation. I know several people that this has happened to, and they do very little to retain members.


My Paycheck has been Refunded by the bank twice. (12/8/2019) ~ Personal Finance

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You need to find a new job. This isn't a glitch. They're bouncing checks. Robbing Peter to pay Paul. Even if they refund overdrafts, if this happens a lot, your bank can fire you as a client and you end up on a bank "do not open list" that is shared with other banks


You absolutely need to find a new job ASAP, and badger the owner for your back pay incessantly. Many business owners are in denial and run their businesses all the way into the ground, screwing employees out of owed wages.


Once is a mistake twice is a pattern. You need to find a new fun coffee shop, this one is about to close.


It's a HUGE sign the business is collapsing. The priority for any business has to be to pay their staff. If they can't pay you get out.


If checks bounce, they are in the red, and paying the employee after only nine days and also refunding the employees' overdraft fees means even less money to pay out the next round of salaries. You have two incomes, can you live on one? Even then, you're gonna lose both soon. And you are in the negative if one paycheck bounces, so you have no savings. Don't gamble with your luck any further. Three-step plan: * Send out applications today. At least one of you has to find stable employment within a fortnight. You can both apply at the same shops, but don't work for the same, because then you put all your eggs in one basket. * Make a budget. Reduce your expenses, cut on whatever you can. No eating out, cheaper mobiles, no cable, no Christmas presents. * Make sure to have at least one month of expenses saved up ASAP. For the future, make sure to have at least six months of expenses saved up somewhere.


Server gave himself an extra tip on my credit card (12/13/2019) ~ Personal Finance

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I should probably reconcile my dining receipts with my credit card statement... Or even look at my credit card statement on a regular basis.


>How long should I give them to fix it before I just dispute the charge on my credit card? When did they tell you they would respond? Give them the opportunity first.


This happened to me the other day at my local waffle houses. I used my card, didn't put any tip on the card, but gave cash instead. The server put 10 dollars extra on it. A Few days later, I noticed, called my back, and they refunded me the money. I also called the Waffle house corporate and told them their server did this. ​ The bank will dispute with them and get the money back, but they gave me my 10 dollars right away.


I’d give them until Monday then dispute with the bank. May have been malfeasance. May have been a fat finger or accident.


If I were in your shoes, I’d ask myself is my time chasing this down worth $3? I know this is probably an unpopular opinion.


19 states in The U.S. increase their minimum wages, by 2024 Federal minimum wage will stand at $15 (12/11/2019) ~ Economics

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And by insisting on a specific number rather than some moving rate tied to local COL we'll just be kicking this can down the road a few more years.


Just in time for people to need 25 an hour to live.


Legit question. When (not if) minimum wage is raised to $15, what happens to those in a position that isn't entry level currently making $15?


Isn't this increase still vastly behind inflation rates, and better yet, still doesn't close the 'houses earned per year of minimum wage' gap between now and 50 years ago?


Was this article written by a bot? > The Fair Labor Standards Act might have very well missed the mark by decades. Lawmakers unwittingly turned on the corrosion switch on the minimum wage. The takeaway - a reduced purchasing power and longer hours at work to get at the base of what we know today as a decent living. Also is anyone noticing that they're talking about this like it's law, but it only passed the house (No GOP support)?


The U.S. administration is highly selective in how it applies the standard of “self-sufficiency” – People without a job will have a harder time accessing food. Meanwhile, it has actually increased subsidies for the largest Midwest farms. 75% of taxpayer subsidies now go to the 10% largest companies (12/12/2019) ~ Economics

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*”When political action committees give you money, they expect something in return other than good government. Poor people do not give you political contributions. You might get a different result if there were a poor-PAC up here.”* **— Bob Dole, former Senate Majority Leader and 1996 Presidential candidate**


This entire ordeal of taking from small farmers and tax payers to give to the big agribusinesses is so soulless and evil. It's so depressing to learn that even when someone says they support their lower income voters, it isn't true. Is it ever true?


This is what's really great with our system these days: We go to great lengths to find those who (A.) have the most, so as to **give** them even more, while (B.) go to equally great lengths to find those who have the least, which makes them weakest, and therefore the easiest to **take** the most from. It's basically like Robinhood in reverse, but jacked-up to exponential proportions. Truly it's breathtaking in its cruelty and amorality.


Do the top 10% represent more than 75% of the agriculture output?


Steinbeck would be soooo ticked. It’s The Grapes of Wrath continued...


WTO Authorizes China to Hit US With $3.6 Billion in Sanctions (12/13/2019) ~ Economics

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Looks like the WTO is pissed that the US took action without asking the WTO for permission. Not that our action was wrong - because it wasn't, but that we bypassed the WTO in doing so.


Cool, they can take it out of the Trillions they owe us for IP theft and market manipulation.


Wait, so China did the dumping and we get hit with sanctions? Am I reading that right?


Article is from November, FYI.


The China issue is one of the things I think Donald Trump is solving quite well to some extent. I've also been shocked that there have been no China tariff questions in the Democratic debates, even if that is quite an important subject. I wonder if the new US president will be willing to revert the tariffs imposed by the Trump administration.


Harvard’s Larry Summers: America needs its unions more than ever. A pervasive sense of vulnerability and missing opportunity leads to dissatisfaction, reduces faith in government and institutions and increases resentment towards members of other ethnic groups (12/9/2019) ~ Economics

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This guy is saying this? Holy moly. That's unexpected.


Man who unleashed face-eating leopards to eat everyone's faces off says Americans need their faces now more than ever.


I was part of a union. It’s great. A well run union manages a lot of things and actually can help supplement benefits so as to relieve a corporation from the pressure of having to furnish some of them. For instance our union managed retirement funds, health care insurance, and pensions (separate from retirement savings funds). As far as job security, unions aren’t magical fairies of guaranteed jobs. If a sector or company starts to sink, lay-offs and hiring freezes and wage freezes can still happen. If jobs go away, a union is not really geared to prevent normal consequences stemming from market forces.


This chameleon asshole just reinvents to champion whatever the cause de celebre is, and he can go fuck himself every time. I’m Larry “Neoliberal” Summers, and I say we need unions! Fuck off.


Did he gather this during his drive through rural America?


Paul A. Volcker, Fed Chairman Who Waged War on Inflation, Is Dead at 92 (12/9/2019) ~ Economics

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>Mr. Volcker helped shape American economic policy for decades, notably by leading the Federal Reserve’s brute-force campaign to subdue inflation in the 1970s and ’80s.


When I was an Econ student, Volcker was always one of my favorite figures to study. He’ll be missed.


All my life I grew up with pretty much 0 interest rates. Even at 5% interest, it seems hard to understand. I can’t imagine a time when it was 20%.


One of my econ professors, while covering economic policies, went on tangents nearly each lecture about Paul Volcker So we heard so many ways to tell one story: how this big, ugly, giant of a man (no offense, that’s how he told it; also Volcker is 6’7”) ended stagflation by taking forceful control over the Fed that was losing credibility. Volcker had a massive presence; nobody dared to go against him. Volcker didn’t care. He just walked up, made bold changes. Boom! Doubles the fed funds rate. Boom (again). Lowered inflation; stagflation ends. Volcker’s physical descriptions (height weight etc) fluctuated each time my professor told the story, but it was in good name: to emphasize his size to paint him an economic “monster” or “giant”. We got lectured on Volcker then got math questions for our exam. It’s one of the most memorable learning experiences as an econ student. It helps that the class was notoriously challenging (74%? curved up to an”A” and between 1/4 and 1/3 of the students had to repeat the course to get a required C or better). You will be remembered Mr. Volcker. Seriously. RIP


Fuck man. It was always interesting, when I was studying his work, to realize he was still alive. Damn. R. I. P.


I’ve been raised by financially irresponsible people and some things I’ve been taught are making my life harder than they have to be. I need to start learning better finance skills (12/8/2019) ~ Personal Finance

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Read the Prime Directive and the PF wiki -----> That covers many areas, plus keep reading the various questions that come up on this subreddit. There are a few authors like Dave Ramsey, David Bach, Suze Orman; or Ramit Sethi and his "I will teach you to be reach". Plus websites that talk about personal finance. Be prepared that some of these authors have their pet ideas which may or may not be relevant for you; or the context. For instance, Dave Ramsey focuses on getting out of debt, so he tends to say that you should not get credit cards / debt; that's in the context of folks who've got into trouble because they haven't managed debt. If you don't have a credit card debt issue and have learnt how to manage money and budgets; credit cards can be a useful tool. Welcome to a lifelong learning journey. You're at a better place than someone who has already gone below with crushing debt and no easy way to get out.


Dave Ramsey will be your friend. Read his Total Money Makeover book for the basics of living within your means. You may also like The Millionaire Next Door (by a different author) for a model of what a life lived by these principals can look like. Life is so much less stressful when you have savings and spend less than you make. Good luck!


Sure, there are simple "rules." Simple to understand, not necessarily simple to make yourself follow 🙂 1) Live on less than you earn. That means income and outgo are fair game to be adjusted. Which means step one is a monthly budget. XX is coming in in January, where do I plan to spend it all? Oops, I run out of money on the 20th of January. That means go back and cut the proposed spending, or figure out how to get a 2nd or 3rd job. 2) Don't do anything with money unless you understand it. For example, leasing a car doesn't mean you are doomed to eat insects and dog food in "retirement," but it IS the most expensive way to "own" a vehicle. 3) Have a plan and follow it. An easy plan is free for the taking by investigating Dave Ramsey's website. Seven steps, all readily available, no "secret insights for just $19.99 a month."


Ok I can relate a bit. Coming from some affluence and then making it on your own has its own challenges. Parents let me buy their old Mercedes right out of grad school. Spent over $8,000 over the next 8 months maintaining it - sold it and bought a used Prius as soon as I realized how pricey owning a luxury car could be (brother discovered the same thing with his Lexus). It’s taken me a long time to “settle” for less (aka what I can reasonably afford), but more than anything what’s helped me is understanding how truly important saving is. Make a spreadsheet of your budget, and add a tab that does some financial projections. What you realize real quick is that every dollar you invest RIGHT NOW is worth more than any dollar you’ll ever save in the future. I’ve spent years trying to focus on what I really want and then accepted that the nice accoutrements will have to come with time.


It is good you recognize the difference now so you can get on the right path and do well for your future self. Yes, PF Wiki a must read and a good start. One book I would recommend is *I Will Teach You to Be Rich by Ramit Sethi,* the second edition contains more info because he re-wrote parts addressing comments he received on the first edition. He uses comments from readers to demonstrate how people changed their attitudes, got on the right track and were successful doing it. *Your Money or Your Life by Vicki Robin and Joe Dominguez* can throw a new light on the way we think about money and the impact our money attitudes/emotions have on our life or the quality of our life. There are also lots of financial videos at YouTube to help educate you. Sometimes you can read a lot, see a lot and then you can plan out what you want with all the ideas. Always remember to revisit your plan periodically and tweak it. If you have not started one - start a Roth IRA, that is a step in the right direction for your future.


Goldman Sachs says that every one of its private equity clients is preparing for recession (12/8/2019) ~ Economics

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If we have enough of this, it'll become a self-fulfilling prophecy 😕


>However, Goldman's own economists aren't anywhere near as bearish: The bank said last month that it sees growth gaining pace next year, to between 2.25% and 2.5%, and expect unemployment to drop to Korean War-era lows. Risk of recession in 2020 is one in five, they say. 


I'm a bit newbie when it comes to econ, but what is up with the looming recession? It feels like for the past couple of years I keep hearing its gonna happen soon and I'm wondering how this is actually going to affect normal Joe me


And yet the SP500 soars like an eagle +_+


This can be good thing for long-running bull market. Self-regulated behavior. Investors moving to bonds market means there is still room for indexes like S&P 500 to run. Given that US market is doing really well but the rest of the world is struggling, Goldman Sach exec probably means their client is preparing for Asia recession.


Prince Mohamed of Saudi Arabia physically threatening investors for Aramco IPO to reach $2 Trillion Target (12/11/2019) ~ Investing

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(SoftBank has entered the chat)


The entire philosophy of creating public shares in Aramco was to help reduce Saudi's reliance on oil and to diversify their market. Now they are forcing up the price of these shares and selling it to their own citizens. Once step forwards TWO steps back.


just start chopping up investors until it reaches $2T


The beatings will continue until our company's market cap improves.


Peak oil. Long live Tesla.


S&P 500 Buybacks Now Outpace All R&D Spending in the US (12/11/2019) ~ Investing

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Perhaps this will shock some people, but there comes a point where your R+D guys are appropriately funded and there is *no good business reason* to spend more in that area. Stock buybacks are just a tax efficient method for corps to return money to shareholders, i.e. the business owners.


I don't really understand why people get so irrationally afraid of returning capital to shareholders. This sub loves dividends but for some reason loses all sense of financial knowledge when it comes to buybacks. What if the headline was "total dividends now eclipse R&D spending". You'd hopefully rightly conclude that the two had nothing to do with each other and this was a stupid headline.


I don't have a problem with buybacks. Done correctly, they are an excellent way for the leadership of a company to give value back to the shareholders. However, this implies that we trust the leadership of the company to be an able steward of our and their capital. I think leadership should approach buybacks the same way that an investor would approach buying their company's stock; by comparing the price of the stock to the value. The leadership should have a distinct advantage in understanding if their company is undervalued or not. The situation where the leadership uses buybacks when the stock's price is below or even at it's value is totally fine in my opinion. My problem with the huge increase in recent buybacks is that total market indicators favored by prominent value investors like Warren Buffett, like the Shiller P/E, show that the current market is very overvalued. I'm sure there are some companies being bought back that are undervalued but the majority of them are overvalued. This means that those companies are essentially burning cash equal to the difference between the price and value for every share they buy back instead of investing that cash, possibly at a later time, in a way that is beneficial for the shareholders. This problem is compounded when you look at how corporate debt has skyrocketed recently as well. Interest rates are very low but when so many companies are borrowing large amounts of debt that will take years to pay back and immediately burning it on overvalued buybacks instead of profitable investments, that is cause for concern and shows leadership that is more interested in meeting an inflated short term goal than the long term health of their company and shareholders. The problem isn't that there is a large amount of buybacks. If this same situation had taken place after the crash a decade ago, it would, on average, have been an amazing consolidation of value. The problem is the mass mishandling of shareholders' money by leveraging large amounts of debt with the intention of making their company look better in the short term.


This should be great in the short term, and shitty in the long term. Which is just what the market wants, right?


Has this ever happened historically?


Sold a car on Craigslist… and the new owner is unhappy… (12/11/2019) ~ Personal Finance

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In the US, any private-party car sale is "as-is" unless a warranty is explicitly provided. I'm not sure about Canada, but it's probably similar. For a $600 car, I'd say any prudent person would know they're not getting a "perfect" vehicle. I'd tell them to pound sand and stop calling you.


I think for a 16 year old car with 323k "as is" is implied. I wouldn't sweat it.


>Sold a car on Craigslist... and the new owner is unhappy... And that’s too bad... The End.


Lots of people threaten lawsuits. Very few follow through. Unless you have a provincial or similar ordinance that requires a seller warrant a used vehicle, then you should just ignore him. Get a screenshot of the new owner listing it for sale in case anyone does pursue legal action down the line.


I would send the seller a bucket of sand, a sledgehammer, and tell him to pound it. It's a $600, 17 year old German car with 323,000 KMs, WTF did he expect?


Stock futures turn negative after Trump says a report on trade deal is ‘completely wrong’ (12/13/2019) ~ Investing

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Lingling Wei reported the story for WSJ. She's possibly the best China reporter any US news outlet has out there. I doubt she needs to find a 'better leaker.' China has a 10am ET conference to talk about trade. What a world we live in where we have to wait for the Chinese government to tell us what's actually real and what's not.


Imagine actually being dumb enough to believe anything Trump says about the trade deal


Imagine what might happen if a businessman with a long history of shady deals was able to move the market with a tweet.


At this rate Trump's behaviour around the trade deal feels like a strange form of extremely-public market manipulation :z


Lmao like fucking clockwork


Dow jumps 260 points, hits record on Trump tweet saying US is ‘very close’ to China deal (12/12/2019) ~ Investing

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tomorrow: china is bad and there will be no deal ever! Tariffs to the moon on every country!


Haven’t heard this before.. /s


I love the smell of .74% in the morning. Retirement time!


Meanwhile apparently Navarro is circulating a memo saying the WH should remove all business uncertainty (hey, good idea!) by announcing "no deal until after the elections" (oh no) and riding the tariffs to victory (hubba what?). This trade policy is like a headless chicken. Just going wherever.


He keeps saying this. The market goes up. And then it turns out to be BS and the market goes down. Smacks of market manipulation to me.


The Massachusetts car economy is costing us $64 billion a year, and we barely notice it (12/14/2019) ~ Economics

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Same shit in most of the major cities. Time to get more workers telecommuting and offer incentives for employees to move closer and employers to move away from city hubs.


For the Paywalled: A new report from the Harvard Kennedy School reveals what car culture costs us all. By Nestor Ramos Globe Columnist,Updated December 13, 2019, 6:00 a.m. It’s Thursday morning, and millions of cars are parked in millions of driveways all over Massachusetts, gassed up and ready for their daily commutes. Car payments, insurance, E-ZPass and gas: These are the kinds of things most of us think about when we consider the cost of driving. But the real price Massachusetts pays for its vehicle economy is much, much higher. Now, thanks to an ambitious research project by a team of graduate students at the Harvard Kennedy School, we have an idea of just how high: $64.1 billion a year. That astronomical estimate includes all the things we don’t often think about when we get into our cars — costs that extend far beyond what we pay at the dealership or the pump. And the biggest slice of that giant pie gets paid for before anybody actually signs a lease or gets behind the wheel. So many of the expenses associated with cars and roads are borne by the public that the average family in Massachusetts is on the hook for about $14,000 a year, whether they own a car or not, the study found. For those who do own vehicles, the average annual costs nearly double. “We never talk about the costs of driving,” said Rep. Seth Moulton, who suggested the study to Linda Bilmes, the Kennedy School public policy professor who oversaw the work. “We always talk about subsidies that go to railway passengers, but never the subsidies that go to drivers. ... We are subsidizing the least efficient way to get around." The costs we all bear include everything from the maintenance of road surfaces across Massachusetts ($1.4 billion) and the estimated annual value of the land we’ve paved for roads and parking ($8.7 billion) to the indirect but very real costs of productivity lost due to time sitting in traffic ($4.6 billion) and as a result of injuries and deaths on the road ($10.5 billion). Once you know where to look, you see the cost of the motor vehicle economy everywhere,” said Stevie Olson, the lead author of the study and a graduate student studying public policy at the Kennedy School. “Often times we’re presented with the high costs for infrastructure for public transit but we never consider the true cost of operating the road infrastructure.” Indeed, when we talk about the T and the sorry state of our public transit system, we often talk in dollars, whether that’s billions for a rail link between North and South Stations or a $50 million cash infusion in the wake of the latest safety report. At the highest levels of state government, we come back again and again to the levels at which taxpayers subsidize transit. But when we talk about state highways and city streets, that calculus gets much more complicated, the various costs so entrenched and diffuse that they are practically invisible. Beyond the portion we pay for directly at the pump, the roads sometimes seem free. But they aren’t free — far from it. “You may not pay a tax that covers the pollution from your car, but people that are breathing that in and people that are getting asthma and other related afflictions end up at the doctor. Someone is paying for that,” Olson said. “If you take the T to Stop and Shop, you’re still having to pay for that business to upkeep its parking lot. Those costs are embedded in consumer products.” When was the last time you considered how much extra your home cost because of the land value of the driveway? How about what could have been done with all the valuable land that has been given over to storing cars overnight? “The amount of land committed to roads and parking is enormous, and it’s something that we take for granted. All that land could be something else," Olson said. Moulton has long advocated for high speed regional rail in Massachusetts, but the study does not compare cars to transit, or advocate for any particular way forward. Instead, it provides an important and often missing piece of the ongoing discussion about how Massachusetts can grapple with a transportation system in crisis. It is too easy when we talk about expensive new transit projects to consider them in vacuum, as if the cost of doing nothing is, well, nothing. But the status quo isn’t free by a long shot — it’s costing us billions of dollars and hundreds of lives every year. When a report on the MBTA’s dubious approach to safety was unveiled this week, the public was understandably aghast to learn that, in the words of the report, “financial considerations take precedence over operational performance and safety.” Clearly, the T must address the shortcomings detailed in the report. After all, imagine if someone was killed because the T wasn’t safe. OK, now imagine if someone was killed every day. But you don’t have to imagine: That’s what happens on our roads, where 360 traffic fatalities occurred in Massachusetts in 2018 according to the National Highway Traffic Safety Administration. The costs associated with all that death and destruction don’t usually show up on balance sheets, but we all pay them nonetheless. That’s just part of the price of the $64 billion status quo. That’s the big blank space in our critical regional conversation about transportation that the study begins to fill in. Maybe even when all the real costs are considered, we’ll still think it’s worth it when we walk out to our cars. But at least we’ll be thinking about it honestly. *(Edit: Thank you for the gold!)*


Lots of facts and details are missing in this article. The benefits aren't enumerated or quantified. Also assumptions are made but not stated. A couple examples: **"We are subsidizing the least efficient way to get around."** It depends what you mean by "efficient." If you mean dollars per pound of human moved, vehicles are probably least efficient. But if you mean use of a specific human's time to get where they are going, cars are extremely efficient. I can get from home to work in about 15 minutes at the exact specific time I need to, even if that varies. On public transport, busses, trains, or a bike, the use of my time (a valuable resource) would be much more, hence much less efficient. **"The costs we all bear include everything from...the estimated annual value of the land we’ve paved for roads and parking ($8.7 billion) to the indirect but very real costs of productivity lost due to time sitting in traffic ($4.6 billion) and as a result of injuries and deaths on the road ($10.5 billion). "** If we were to revert the land for roads to some other use, how would police, ambulance, and fire get to emergencies? What would the cost be in terms of property damage and human life then? And how would busses and/or trains run if none of those corridors where roads are were open for transport? And, again, they talk about time lost due to sitting in traffic. But how much time is *saved* due to not waiting for a bus or train, or having to wait at work or home until the next bus is scheduled to arrive. How much time is saved by going directly to my destination rather than on some other long route with dozens of stops on the way? And how many deaths and injuries are prevented or mitigated because we have roads? Again, I'm thinking of police, fire, and ambulance? **TO BE CLEAR:** I am not anti-public transport. And I think this is a valuable study. But it needs to be put in the proper context. The value of *having* vehicular transport needs to be measured with the same rigor; then we can compare honestly.


There should be tax incentives for commuters who live close to their jobs. The areas around my work are so expensive but if I had an incentive to move closer I might try to make it work. These incentives might come with some negative consequences though like skyrocketing real estate prices around big job nodes like cities but at least there will be less traffic.


Ok, but it's also the truck economy, which is what brings the rest of the economy to people.


If you bought a 20 year Treasury in Nov 1999 and held to maturity, you would have beat the S&P by 0.62% (12/9/2019) ~ Investing

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Perfect timing often produces fantastic results. Good asset allocation is less helpful. We know how to achieve good asset allocation, we don't know how to achieve perfect timing.


Very interesting, lucky guys you are in developed countries, i am from India and sold my land in 1998 and bought govt bonds, and inflation ate it out for more than 10yrs out of the 20year period, i think i had just 50% inflation adjusted gains over 20years.


Picking single arbitrary date is useless


Over many periods of time short and long term treasury bills would have outperformed the S&P500. That’s the whole point.


Why? Long fixed income has crushed it as rates have gone down. Run the numbers if you held a constant duration 20y position.


JP Morgan sees S&P 500 rising 8% in 2020 as economy ‘reaccelerates’ (12/9/2019) ~ Investing

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weren't all the banks saying recession soon two months ago?


recession confirmed


Just reading/listening to Taleb's book Black Swan. I tend to agree with him that I trust these forecasts about as much as that of a cab driver. There is an incredible amount randomness and uncertainty involved.


Says the brokerage that gets paid a cut when people invest through them.


JP Morgan: 8% growth, economy reaccelerates in 2020 r/investing in 2020: 8% more recession posts. This thread when JPM analyst says it's going to be good next year: "It's all a scam! Analysts don't know anything." This thread if the same analyst said there was going to be a recession next year: "This guy gets it."


Netflix could lose four million U.S. subscribers in 2020: brokerage (12/10/2019) ~ Investing

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I think the brokers are overestimating how much of a Netflix killer Disney+ is. I use both services and the variety of entertainment works very well together.


"Who would have thought that raising prices by providing less service would have led to customers leaving?" Every American corporation ever.


I’m gonna tell my grandkids about the golden years where everything was just on 1 streaming service


My prediction is numbers will plummet once they lose Friends and the Office. My worry is that when content gets distributed amongst too many players, none of them are worth the hassle and cost of subscription.


NFLX isn't done but their numbers they have been touting has subscriber growth. That's been their drum beat for years and we were told to just forget about profitability and everything else. They now have less to offer as the middleman as a content provider. There are other cheaper alternatives. As a content creator they are spending billions of dollars to create things like 8 episode seasons of Stranger Things. Other than that they have created no IP of lasting value. Nobody has family night and gathers around to watch House of Cards more than once. However little Jenny is going to want to see Frozen for the hundredth damn time and get dressed up in her Elsa dress with her Lion King stuffed animals. Disney+ isn't a NFLX killer. But Disney+ and AppleTV and Roku and HBO and Hulu and CBS All Access? Maybe or maybe not but each one pulls away from NFLX with its 97 P/E ratio.


Does anyone PAY to go to work? (12/13/2019) ~ Personal Finance

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She's helping her earn record for SS and avoiding a gap on her resume, so working now also gives more money later.


My husband doesn't make what it costs us with two kids in daycare, but he doesn't want to stay at home (I don't blame him). We are just grinding it out until they get to school and hopefully the cost for care will be less.


That's modern life. A good daycare in an area with good jobs will cost a lot. It's standard for you to pay the daycare even when your kid is sick; they still have to keep the place running. It gets cheaper as they get older, and if you have good public schools, it gets much cheaper at 5 or 6 (although you will still have to pay for before/after care). Make sure you sign up to transfer the full $5,000 per year of pre-tax salary into a Dependent Care Account. You will need receipts from your care provider with their tax ID, specific dates, and costs. I start the reimbursement process in January, so I get the full $416.67 deposited into my checking account the day after my paycheck hits. Your kid will stop getting sick so much once his immune system sees each disease. The socialization is very important; you need your kid to be cool with you leaving him. There are emergency nannies you can get for those times that the kid is sick and you both need to be at work. Of course, that costs additional money. If it's a total wash, your wife might want to stay home with him, but that's going to be taxing on her relationship with both of you. And it'll set her back in her career.


Do you write off the daycare come tax time? The situation sucks but I would assume as long as you're not losing much by having the daycare (and you can afford it) it's probably worth her staying as eventually the kid will be in school and her career won't have been put on hold for a few years.


Two things. One, consider the costs of daycare against both of your salaries. So if your income is 2x and hers is x and daycare costs x, then she's paying half of her salary and you are paying 25% of yours. Overall, daycare is costing 33% of your household income. Second, the negative impact of a gap in earnings, lack of social security wages, lack of retirement contributions etc. should not be understated. Child carers pay a disproportionate penalty in opportunity costs to take time away from a career for childcare. So you have a few options. One, you take time off for the sick kid. Discuss with your employer ways to make this work - e.g. can you shift your schedule such that you cover childcare while your wife works and then you work different hours temporarily? Two, can you find another caretaker for a sick child (sometimes a grandparent can step in). Three, can your wife find a better paid position?


Why is it so hard to find average people who have become wealthy through index funds? (12/9/2019) ~ Investing

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Because you’re just hearing from more aggressive investors. Passive investors don’t spend a lot of time on investment boards bragging about their conservative approach. Also, it’s a bit like gambling, where you only hear about the good choices aggressive investors made. No one is bragging about their bad beat.


Because $150k is twice the median household income in the US, and $40k is more than most Americans have in savings in total, let alone annual savings. Basically, you've set up a premise that's nearly impossible to validate, because people who can save $40k per year over 30 years are almost exclusively high earners.


It's called stealth wealth.


Most "wealthy" people don't show it off? If you're going to slowly and steadily work and save and invest over 35+ years, I seriously doubt you're the type of person to show off wealth. My in laws are rich as hell...but you wouldn't even know it. They're very humble and in many ways cheapskates lol If you're born into wealth, or immediately come into wealth...maybe that's different. Index funds aren't an 'I win' button.... you still have to save a lot and be consistent over a long period of time.


If you're household income is just under 150k and you have a tax rate of call it 25% plus 5% for state tax you have a take home pay of just over 100k. No chance people are saving 40% of the take home pay. Not with children. That doesn't exist because people who make that don't save that much


Peloton plunges after investor says the stock is worth only $5 (12/11/2019) ~ Finance

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An overpriced treadmill with a screen? I’m good.


Peloton is for an affluent crowd, not a millennial one.


> Short-seller Citron Research said Tuesday it expects the stock to plunge nearly 85% to just $5 a share. Firm banking on stonk falling says stonk will fall. How is this news?


Looks like Citron has a new target now that they have reaped big $$ shorting Jumia. 😀


I don’t understand this article. Peloton already has a treadmill, and has since before their IPO. Why are they talking about “when it will happen”? Also, Apple only sells hardware, software, and subscriptions, so using that as a way of putting a company down doesn’t make sense. More talk about why the competition will erode peloton would’ve been more helpful. Edit: spellcheck is changing “talk” to “y’all” for some reason, corrected that.


What is the single most important/influential thing you have learned since striving to become financially literate, or gain financial freedom? (12/9/2019) ~ Investing

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Don’t try to keep up with anyone, especially at work and people on social media. And... stealth wealth. Wear it like a cloak!


You can have ANYTHING you want, but you cannot have EVERYTHING you want, so focus on what really matters.


You are better off plowing time into your career than spending a bunch of time optimizing your investments to get a slightly higher yield.


Jim Cramer is an idiot


Young people are better off focusing on earning power and savings rate, vs. fancy investments. As for being bold, there is a time for that, but plenty become habitual gamblers instead of investors. Many squander years of savings and incredible amounts of time and end up near broke after 10 or 20 years of being bold.


Morgan Stanley cutting jobs due to uncertain environment: Sources (12/9/2019) ~ Finance

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As a current tech employee at a large bank, this is the downside of working in the non revenue generating side of the business


Paul Volcker died and the top story in this sub is about MS accelerating back office attrition by like two, three months.


Eh - banks turnover the bottom 5% to 10% of their employee base every single year. "Up or out" is a very real thing.


A 2% cut is not extraordinary in any given year. Non-US IBs have been exiting entire markets or business altogether (e.g DB, Nomura, Barcap). Fin svcs is a cyclical biz and we’re in a bad part of the cycle.


This is every bank since they’ve realized there’s a lot of fat to trim. I think US Bancorp unloaded close to 10% of its workforce last year, in increments that didn’t bring about bad publicity. From what I heard from friends that work there it included a lot of managing directors and execs


My employer only reimburses $0.30/mile for personal car use on the clock, can I claim the additional $0.245/mile on my taxes to bring it up the the IRS suggested rate of $0.545/mile? (12/13/2019) ~ Personal Finance

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IRS is 58 cents per mile now. You cannot claim mileage deduction on your taxes unless you are self employed. You can ask your employer for more money or ask them to provide you a company owned vehicle and a gas card. You might also want to check with your insurance company about driving your personal car for work as they might require different coverage.


Unless it's a government based position or contract, there is no "imposed" amount. The suggested rates are just that... suggested. Again unless it's a government based scenario. If they won't bump your mileage up any, ask if they have a company vehicle for you to use for company purposes.


I would make sure whatever you are driving is as cheap as possible to drive. Like an 2012 toyota yaris or something like that because otherwise you may end up losing money driving around for them.


If your employer requires you to transport non employees in your own car, YOU are liable for any damage to the non employee, and most likely your existing insurance does not cover this situation. You are providing cabulance type service... you should insist on a company vehicle with the correct insurance coverage. An attorney would say your a patient care transporter... does your vehicle have all the required PPE on board, fire extinguishers, seat belts, first aid kit etc... unlikely... your being taken advantage of and this is generally an industry wide thing... just because others do it done not mean it is safe, prudent or legal... good luck...


So basically you are a taxi/Uber driver for their clients. You should look into everything they recommend for driving Uber/Lyft. Such as insurance, mileage, and possibly limited liability. Also find out if you are supposed to be specially licensed to transport disabled/elderly/minor clients.


So when should you get out of a profitable investment? (12/12/2019) ~ Investing

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at the peak!


Depends on the investment. My shares of MSFT? No time soon If i Yolo on an option, a 20% gain is good.


Don't forget to factor in your total bank roll and risk. Think of the game show deal or no deal. Imagine you could take the 200k suitcase now or flip a coin for 500k or nothing. Game theory says flipping the coin for the 500k suitcase is the best option but for most people(who are basically broke) the guaranteed 200k is so lifechanging and they should take it considering they will never get such an opportunity again.


Most of Buffett’s key holdings also pay solid dividends. He is a value investor, but also gets large dividend returns. If you pick solid, not going anywhere, dividend paying stocks. That is literally your plan. Hold, and use the dividend to buy more solid blue chip stock and so on. Time compounds your gains.


From personal experiance, I found that occasionally trimming winning positions is best. If it continues to go up, the worst that happens is you miss out on proffit (which in all honesty isn't that bad.) Should your position go down but you trimmed prior, you now have addtional funds to employ and can DCA back in to purchase the dip.


If your tired of getting credit offers, you can opt-out indefinitely by mail or for 5 years online (12/10/2019) ~ Personal Finance

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Also the whole "pre-approved" thing is bullshit. It doesn't mean you are already approved for the offer, it just means you are "pre" the approval process. Literally meaning the opposite of what it implies.


If anyone follows through with this, I can tell you that at a couple of points in the process, the site makes it seem like a really big deal if you actually follow through. It almost has a tone of "are you sure you want to do this? You may miss out on outstanding opportunities..." I actually did find myself 2nd guessing it but then realized they're trying to talk you out of opting out. If you go for the permanent opt out, they add a wrinkle to give you yet another opportunity to second guess your decision: they mail you some hard copy form that you have to hand sign and mail back.


When I used to get credit card offers in the mail I would write a message in black marker that said "usury is a sin" and send it back to them using their pre paid envelope. I dont get unsolicited credit card offers anymore.


Also register at dmachoice to stop junk mail. I think it costs $2 for ten years, and add your number to the do not call registry. Another one is to check the marketing preferences for all your bank, credit card and other accounts, usually there are options to limit marketing.


I dunno, I get excited to see mail, maybe I'm just not getting enough 😆


[US] if my pay period ends 12/27 and I get paid 1/3, which year does it count for on my taxes? (12/13/2019) ~ Personal Finance

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2020, the year you get the money.


2020, individual taxes on wages are done on a cash basis, aka whatever date you receive your money.


Somewhat related question - does a 401k contribution count towards the year in which it was withheld from your paycheck, or the year in which it is actually invested into your 401k? Let's say my final payday is on 12/27/2019, but the funds don't make it into my 401k until the following week on 1/3/2020. To which year is the contribution counted?


Depending on the state, you can request your final paycheck to be ready in 72 hours after your last day. Ask your manager or payroll if they can get that going for you.


Also note that most states have a minimum reporting threshold. You won't necessarily have to file taxes in the old state of there wasn't enough earned in that state.


Nobel laureate Robert Shiller argues that gossip, half-baked philosophy, and fake news drive economics — not only numbers. His peers aren’t exactly thrilled. (12/12/2019) ~ Economics

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Honestly thought this was common knowledge. There have been countless people arrested for swaying markets (pump and dump) using blogs and spam emails...


"animal spirits"


He is right, all these things influence our 'animal instincts' or in layman's term our intuition/feeling/instincts. Numbers are a language like English, chinese, Russian, you name it but our understanding of that language is very poor compared to languages we use near every minute of our lives. Average people don't use feelings but their animal instincts who are much more influenced by linguistics (rumours, mainstream media pundits pushing for certain laws, stocks etc and so on). This is why I believe delving more into behavioural economics is the next step in this epistemic community/field, there are so many unknowns and it's our job in the future to find new ways to quantify it. Just think about all the possible applications and angles this could add to more established theories alone.


Is this our weekly thread which tries to pretend behavioral economics is new and subversive rather than from the 1970's and relatively well integrated with the mainstream?


I've always thought that fear can really hold back the economy. I sell landscaping stone in Wisconsin, when Scott Walker went after teachers, I noticed an immediate drop in sales that year. I was selling to fewer teachers, they were all scared for their paychecks.


A Detailed Breakdown of Warren Buffet’s Portfolio for 2020 (12/12/2019) ~ Stock Market

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I've been pretty disappointed with BRK.B this year. Hope 2020 is a better year for the Oracle.


Did not know his Apple holding got so fat lol


Nice post!


I tried to edit in his Cash, GM, and other positions but it wasn't letting me. Here they are as a comment instead. **Cash - ($124,442,000,000)** ***NOT INCLUDED IN STOCK PORTFOLIO PERCENTAGES*** >At the moment, Warren Buffett's largest holding is in cash, about $128 billion. This is a huge increase from the $23 billion in cash Berkshire was holding on to in 2009. Now because of some insurance companies that Berkshire owns, they are required to keep a certain amount of cash on hand, but the amount that Berkshire has been putting away has led a lot of people to speculate that he is expecting a crash or that he is no longer the same great investor he always was. **General Motors - 1.26% ($2,708,669,000)** >Warren Buffett first took a stake in **General Motors**, the world's fourth-largest auto manufacturer by production, in early 2012. He most recently upped Berkshire Hathaway's holdings in the fourth quarter of 2018, when he increased his position by 37%. However, like Kraft Heinz, this is also one of the more disappointing investments for Warren and Berkshire Hathaway. Including dividends, General Motors has returned a disappointing 81% since March 2012 - roughly half the market’s total return in that time. **Others - 12.82% ($27,522,702,000)** >About 12.82% of Berkshire Hathaway’s portfolio is invested in small positions in a wide variety of companies. A few honorable mentions are Visa, Mastercard, Sirius XM, Costco, and Amazon.


They always underperform when the market is charging upwards. Once the downturn comes, they absolutely steal bargains and provide great value and all of a sudden become the best place to invest once again.


Indiana trucking company bankruptcy the tip of the iceberg for strained industry (12/11/2019) ~ Economics

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The local news is running this story and also mentioned that there were several truck companies that set up recruiting booths right in the parking lot and were hiring all the newly laid off workers The top 2 executives of celedon were indited for embezzlement


> Indiana-based trucking company Celadon Group, which filed for bankruptcy Monday, is the latest in a string of company closings that have made 2019 a particularly painful year for the industry. > > While Celadon Group, which shut down all operations as of Monday, was weighed down by costs related to an alleged fraud scheme among former executives, other companies in the industry have been faced with a variety of economic challenges that have led to hundreds of closings. > > Trucking companies are failing at a fast rate in 2019. The pace at which companies are failing is about double the pace of 2018. In the first half of the year alone, 640 trucking companies had failed and more than 20,000 trucks had been pulled from the road.


Just wait until all the teamster pension programs start to fail.


> Trade tariffs, as well as slowdowns in a variety of markets, including housing and auto, contributed to the drop That's right tariffs don't work Didn't think I would be saying that in 2020


“Oh god impeachment isn’t going well and growth numbers are really strong, what bad news can we push about Trump on this clickbait sub??” —you, probably


A $280 college textbook busts budgets, but Harvard Economics author Gregory Mankiw defends royalties (12/12/2019) ~ Economics

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Colleges/professors should drop it until the price comes down. It's a good book, but not $280 good. If not, this is the limit where I propose piracy as a solution. Download the pdf from libgen or some torrent.


Shoutout to my grad school professors who advised us when we could opt to buy the older edition textbook to save money.


Why is "Harvard Economist" an argument?


If an author of a textbook is worried about making enough money on something that is required for each semester by thousands of students every year, there's a deeper problem that exists with the author.


For the entry for "rent-seekers," is it just a picture of Mankiw's own face?


Trump administration reportedly plans to delay China tariffs set to take effect Sunday (12/10/2019) ~ Investing

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Problem with bluffing is when the other sides sees you always backing down from your threat.


So what's your guess that this will come to pass vs. it won't? To me, it's still 50% tariffs will be delayed/50% tariffs still kick in on Dec. 15th.


the tariffs are killing my company's ability to purchase from China. The Chinese aren't budging on regular pricing + the additional customs charge. I don't know from one week to the next what the customs charge is and so forecasting is blown up. War is hell. I get it, I'm supposed to buy "Made In The USA" or elsewhere, but the US and most elsewhere are not big manufacturers in many sectors.


Do not risk the fool.<('o'<)


the new monetary policy: trade rumors


Single use plastic (12/8/2019) ~ Investing

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You could invest in paper related companies, as cardboard and paper-based products have slowly been taking over most factory/warehouse-use styrofoam and some of the recyclable plastics. Maybe stuff like IP, WRK, MERC, KMB, SCA, K.K, NP, or TYO:3863


Northern Technologies International Corporation (NTIC) makes some biodegradable products based on PLA from NatureWorks, maybe look into their competitors as well. Though I'm not sure how well these companies will perform if the economy takes a downturn as the biorenewable alternatives are usually more expensive than traditional commodity plastics.




Sorry if this derails the post, but I'm new to the whole world of investing and was wondering where you guys get such information? It's amazing to see all of this


It's not worthwhile to front-run policy changes and invest in things that may spur about from artificial demands; or lack of alternatives. This is because you never know where something so new in consequence will propagate the cutting edge to new processes, industries or goods. I'd be fairly cautious also due to the fact that you're also frontrunning the acceptance rate/spread of policy. I'm not against this, but I would just try seeking out markets where someone is disrupting by making something adoptable and efficient, where the result cuts time or cuts costs. A manufacturer to a paper straw or biodegradable plates is likely still in incubation and perhaps may never go public but, instead, contract their manufacturing to several larger vendors that make bulk orders and distribute to restaurants. If this catches on, It's very likely their competitors to any such company would be bought out by the current industry leaders that will sell plastics and biodegradables just the same. In which case, they wouldn't be making economic profits...they'd be just substituting where existing earnings come from. Those are my thoughts.


Robinhood joins a wave of fractional stock-trading offers to bring investing to the masses (12/12/2019) ~ Stock Market

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Buying .1 spy put expiring yesterday


ahh yes, that delicious 0.0003 BRK.A share for those investors with $102 in their account.


"WSB has entered the chat"


I use M1 for the fractional shares, it just makes life simpler. Now the idea of being able to day trade fractions seems appealing.


Neat now can we DRIP?


Paul Volcker, Inflation Tamer Who Set Bank Risk Rule, Dies at 92 (12/9/2019) ~ Investing

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GOAT Inflation tamer. RIP


Respect. I have exasperating theoretical arguments with banks over his rule on a weekly basis. Rest in Providence dawg.


Always wondered if Volcker were still heading the Fed now, and Trump would have tweeted that "...Volcker was an idiot........."


I want to know what 10% interest even feels like.


RIP Sir Anyone know his net worth?


Chinese city turns into ghost town after Samsung shifts operation to India, Vietnam (12/12/2019) ~ Economics

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Most manufacturing is headed to India. Even Chinese companies are buying factories in India.


Vietnam produces a lot of raw material commodities that China needs for its production of electronics. This is likely a lateral capital shift to reduced supply chain costs. They already had high demand for Vietnamese commodities.


At least India is less likely to sneak in their own govt spyware or hardware backdoors. Vietnam might but not as prolific as China.


...can we loot it? Just change their business model. Real life fallout RPG


“Livemint” A very reputable source. Furthermore, the source that Livemint basically copies word for word never even once says “City turns into ghost town”. It says the factory town is losing population after the biggest employer, 80% of employment in the “city”, shut down its factory. The factory only employed 3,000 people, so how on earth is that a city? If 3,000 is 80% of employment as SCMP states, then the “city” is only 5,000 people tops with kids included.


NY Fed to Offer $365 billion in year-end repo operations (12/12/2019) ~ Finance

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Of note, overnight repos on 12/31 and 1/2 will increase to $150 billion (I am assuming they mean for each day), and an additional repo of $75 billion offered on 12/30 to mature on 1/2. I am wondering how seriously Poszar's note from the other day was taken by Powell and Co. The key idea, supposedly, is that the amount of liquidity provided by the Fed isn't the real sticking point, it's the balance sheets of primary dealers which are subject to too many restraints; therefore this operation won't really solve the key issues at stake. But I guess we'll see what happens!


I’m still trying to understand this as a novice retail investor, but I’ve found Jeff Snider talking about how this issue is rooted in the Eurodollar market. I imagine it isn’t coincidence that the initial spike came on Eurodollar futures contract settlement day last quarter. This Monday, being the next one, might have something to do with the recent revision. We’ll see how things shake up I guess. If there are dollar shortages in the banking sectors (Domestic & International) and expanding QE is the grease in the wheels, is it not reasonable to expect this liquidity bind-up to continue to spread without some kind of relief valve like QE (as artificial liquidity) or some kind of catalyst for dollar divestment to create liquidity? The safe haven of the (relatively) high yielding and well protected USD, coupled with global ZIRP/NIRP policies squeezing bank balance sheets as the causation for dollar scarcity, which is more likely - continued global economic slowdowns acceleration this phenomenon, or ...I can’t even seem to imagine what other forces could turn the tide. Sorry for the newb question, but this is hard to get feedback on.


Not QE guys...


When they started this a month ago, they actually gave the excuse "this is just short term cash crunches caused by end of quarter corporate tax filings"


> On December 31, 2019 and January 2, 2020, the overnight repo offering will increase to at least $150 billion


‘We are ready to rock and roll’: Mexico says all three countries will sign new NAFTA deal today (12/10/2019) ~ Investing

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Good news for America. And Trump.


Headline reads "Mexico says", suggesting the quote is from a Mexican official, but the quote is from a random representative that was in a meeting with Pelosi. Sigh.


Any stocks that will benefit this trade deal?


Since "the deal must then be ratified by each of their respective legislatures," any chance that happens before 2020?


Doesn't make sense. The term is almost over. They could have waited it out until the end of the presidency for more negotiating leverage with the next presidency. Stupid move from Mexico, good move from the US.


Amazon will be the most important company of the 2020s (12/14/2019) ~ Stock Market

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As a regular trader when I read "above the line" media reports like this, it confirms to me that someone wants to off load a large block of aforementioned shares at a "respectable" price.


GE was the most dominant company of the 90s and early 00s. Their management was considered the best and they were briefly the most valuable company in the world. This too shall pass...


I mean, if things stay the same, sure But that’s the thing about long stretches of time. Things change. Sometimes dramatically


I don't think it's unbelievable that if Amazon continues to attract the ire of the government, we might one day be talking about several companies instead of one Amazon.


I doubt that. I think Apple and Amazons decade of dominance was the 2010's.


U.S. banks’ reluctance to lend cash may have caused repo shock: BIS (12/8/2019) ~ Economics

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The overnight rates spiked to 10% which is ridiculously high. Say they spike to 4%, banks are reluctant to lend? 5%, 6% still reluctant to lend? 8%, 9% still don’t want to lend overnight? There’s more there.


Is this article really pointing out anything new? Saying that the rates went up because of a lack of willingness to lend is almost a tautology.


Is there any way the banks would want to do this to create a fake crisis? By doing so you could leverage easing regulations?


The Fed has been increasing its balance sheet at a rate not seen since the financial crisis. They are very concerned.


No fucking shit. Garbage article.


Governments must learn to love borrowing again (12/8/2019) ~ Finance

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Telling the US learn to love borrowing again is like telling Wilt Chamberlain back in the day to learn to love the ladies again.


The editorial board The global slowdown is not making the politics of macroeconomic policymaking any easier. While doves insist that softening growth requires more muscular support for aggregate demand, hawks legitimately point to the structural sources of the slowdown. This week brought more bad news for the worldwide industrial recession that is holding back global growth. In the US, UK, the eurozone and Japan, manufacturing is below where it was one to two years ago. Dismal new manufacturing data from Germany show the worst is far from over there. Simply boosting aggregate demand does not address the long-term structural challenges to manufacturing, which include hostile trade policy and the push towards carbon-neutral economies. That is not to say it is unnecessary: demand stimulus can at least contain the damage to directly affected sectors and prevent the weakness from spilling over into the services that make up a much larger share of gross domestic product. But the long-term response to green transition challenges, such as a shift from internal combustion to electric vehicles, and to any permanent trade disruption, must involve policies to smooth structural transformations. For this, the mix of fiscal and monetary tools matters as much as the overall policy stance. In most economies that balance is tilted heavily to the monetary side, with unfortunate consequences. Economically, ultra-loose monetary policy has inflated asset prices and may be slowing productivity growth by keeping uneconomic businesses alive. Politically, it has put central banks under enormous pressure from banking lobbies, hard-money ideologues — and in the eurozone, from those in creditor countries who think low interest rates are a way to bail out profligate governments on the sly. In truth, central banks should not be blamed for loose monetary policy. As long as governments are not willing to expand on the fiscal side, central bankers are legally obliged to make up the shortfall in demand support. It is, and should be, for democratically elected politicians to steer the fiscal-monetary mix by setting the balance of government budgets. They would be wise to shift that mix sharply to the fiscal side. Low interest rates have turned out to do more for consumption than for the investment structural transformations demand. Government tight-fistedness, meanwhile, has starved public investment budgets. Greater budget deficits should be welcomed if they finance spending to fit out economies for the future. There are signs that this is slowly happening. The Japanese government has announced an unexpectedly large stimulus for next year. This is in part justified by motivations specific to Japan, to offset a rise in its consumption tax, low compared to most rich economies. The package allows the tax structure to be reformed without an unnecessary hit to short-term growth. Even so, the magnitude of the measures sends a bold signal to other countries. In an environment of permanently low interest rates — which Japan has known longer than anybody else — constraints on government budgets are looser than conventionally thought to be. The concern is not about spending too much, but about spending money well — a change of mindset for policymakers scarred by the financial crisis. There are signs of it happening. The Netherlands is looking to expand investment; even Germany is questioning its balanced-budget dogma. Good. When governments can borrow for free there is little reason not to invest to the hilt. The sooner finance ministers learn to love this situation, the better. Copyright The Financial Times Limited 2019. All rights reserved.


It's not enough to borrow. Governments have to borrow in order to finance the right things. You can borrow lots of money to curb immigration but that's not going to help your economy grow. On the other hand you can borrow to fund stalled markets and boost the market in a direction that makes a difference.


Perhaps a stupid question, but why are stories posted which are behind a paywall?


I don’t think they ever forgot


There’s a lot of love for the s&p 500 index for long term investing. I hear less about investing in an ETF tracking the nasdaq index long term? Is it a good idea? Why/why not? (12/8/2019) ~ Stock Market

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The QQQ is a very popular ETF that track the NASDAQ 100.


People like the Nasdaq generally because it is tech heavy. If you are looking specifically for tech, I would use a technology specific ETF like XLK instead of QQQ.


There are stocks to track just about any index you want.


Nasdaq is very very very tech focused. I would wage the correlation between the securities in the Nasdaq is higher than those of the SP500. In terms of diversification, the SP500 is a good proxy for the market in general, and is fairly representative.


I can’t think of a reason why not as long as you’re a long term investor (much like you would be if you were putting your money into the S&P). I think people tend to have their guard up much more when it comes to tech stocks in general, because it seems like the tech bubble was still so recent. In reality, that was 20 years ago and tech as we knew it at the time was still in its infancy. Today, tech as a sector is far more mature than it was way back then.


I tuned into Vanguard’s webcast last night about the global economic outlook in 2020 and beyond (12/13/2019) ~ Investing

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> Expect reduced returns, especially in the US Markets for years to come This has been being predicted for years, by Vanguard and others, and has yet to come true. I'm not saying this isn't the time when they're not wrong ... but take it with a grain of salt.


100% S&P in the 401k, always will be, 100% High Yield Savings short term. Ready for anything baby


Watched a bit last night. I still don’t see the use for international stocks. Every large cap US company operates globally. Any shock to the US will ripple around the world. All you get are higher fees and less returns for the illusion of diversification.


Can't handle the stress anymore. I am retiring in 10 years and I've been out of work most of this year and I can't take a chance on losing a big chunk of my retirement. After some retirement modeling it with a CFP, i pulled out enough from an age based and put it into a govt bond fund. the plan is to pay off my mortgage, an auto loan and two student loans and some taxes. It was less than half of my retirement savings. In january I am paying off everything and going to $0 debt. no credit cards, no nothing, no debt. and no plans to buy any more real estate, cars, or anything else. Ill take my 24k tax deduction each year and be happy.


I love this graphic. Saw it on some random YouTube video. It’s one of the best visual representations of the pros/cons of an “aggressive” versus “safe” asset allocation.


Senator Elizabeth Warren’s Wealth Tax: Projected Budgetary and Economic Effects — Penn Wharton Budget Model (12/12/2019) ~ Economics

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I deeply deeply question this study's assumptions about avoidance. They took a simple average of several estimates of the wealth tax experiences in Sweden, Spain and a few other countries. Notable about all of these wealth taxes were that they were very small and very 'leaky' in that the wealth they taxed was very narrow (Switzerland is a great example - they *barely* have a wealth tax bc its so leaky, but people love to hold it up as an example). Furthermore, they appear to gloss over a lot of the 'structuring' aspects (eg, private companies are frequently fully/partially exempted from wealth taxes. Well guess what - you see a lot of public companies go private post wealth taxes. Is this classified as avoidance?) This biggest point here - and I have written about this before - is that none of the economies that have had wealth taxes have as deeply developed finance markets as the US (and yes, that includes Switzerland). Several weeks back, a few collegues and I were drinking and talking about how we would structure away 100% of Jeff Bezos AMZN holdings while still maintaining his 20% operating control. Its complicated, but it would take a group of lawyers/srtuc fin guys a few days to figure it out. Here's a semi-example that people might understand - and understand this is ***HUGELY*** ELI5. I have a $100M building outright that I rent to tenants (say an office building) - its illiquid with a thin market and I can't just move a building. Let's say I do this: I enter into a terminally settled, non-transferable, future-callable, sale-leaseback with a partial-repo feature, with an overseas bank. The mechanics are this: I 'sell' the building to, say, Nomura in Japan. This is the 'sale', but I don't take the cash. Instead, Nomura agrees to a 99-year lease where I can operate the and the rent payments are settled via the sale proceeds I never received - this is the terminally settled part. I rent to tenants and keep the net operating profit. Now depending on the corporate profit rate versus the income tax rate, I'm going to either 1) pay myself a 'salary' that zeros the corporate profit or 2) dividend myself, which ever is cheaper. 'Future-callable' means I can undo this in the future; 'repoed' means that if I need some of the money that Nomura is holding from the proceeds, I can get it back in part. You say, "but the operating lease has value!" - does it? Its non-transferable, so it has no market value, and I can zero the economics of it so it has no model value; you can't value that using any generally accepted measure. There are some detailed complicating factors in this example, but they can be sorted out; importantly, transactions like this are fairly common for (completely legal) reasons. The main thing I have done is taken the building out of my calculation of 'wealth' - I would have owed 6% times $100M, but now I don't 'have' a $100M building to tax - Nomura has the building. I will owe either income tax or corp tax, but I would have owed that anyway. Wealth tax zeroed. You might say "well just make X illegal!" - fine. But tax cases like that can take 10-20 years to sort out, and the goal here is to $0 the taxes long enough that you get the wealth tax repealed. It will get repealed, not because of "evil republicans", but because it causes ***MASSIVE*** wealth distortions that you will pay for. In the extreme it will cause capital flight that will be similar to the stagflation in the 1970s. This was the exact reason that France and Sweden repealed their wealth taxes. it wasn't because *rich people* left the countries (although some did) - it was because rich people sent their *capital* overseas, which seriously jacked up interest rates and capital formation. edit - typos


> Penn Wharton Budget Model (PWBM) projects that Senator Warren’s proposed wealth tax, if implemented in 2021, would raise between $2.3 trillion (including macroeconomic effects) and $2.7 trillion (not including macroeconomic effects) in additional revenue in the 10-year window 2021 - 2030 while reducing GDP in 2050 by about 1 to 2 percent, depending on how the money is spent. For reference, Warren’s campaign estimated $3.75 trillion in revenue, more than $1 trillion more than these model estimates.


My favorite portion of her plan is that it will direct revenue of "billionaire tax" to social programs in one hand and has a goal of getting rid of billionaires in another hand... So... what happens where there are no more billionaires to tax and programs are already in place?


Can't wait to see the mass Exodus of the rich and their money and along with that, jobs and business


Would someone ELI5 me the way "capital flight" would be effective in avoiding a wealth tax when the person doesn't leave the country? I understand if someone physically leaves the country and takes their wealth with them. But what about those that stay in the country and move the wealth overseas? If I "move" 10 million dollars into a foreign bank or into foreign investments why would this still not be taxed? The only way around this would be to "hide" it in like a Swiss bank account or something of that nature which would technically be illegal, no? Would people that do this just count on the government not auditing them? This is of course excluding hypothetical vehicles like the poster mentioned.


My Girlfriend’s Mom has a Tax Accountant Telling Her She Can’t Max Out a 401k and Roth IRA (12/11/2019) ~ Personal Finance

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Your mom needs a new accountant


Time to fire Dan. The $19k limit is cumulative across all 401ks... But IRAs don't count towards that limit.


Very unfortunate. People are probably losing money all over with this person.


Well, that's sad.


Find a new accountant


Facebook Was Mystery Firm Bidding Against Google To Buy Fitbit (12/9/2019) ~ Investing

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I expected Amazon or Nike, but not Facebook


Damn, my Facebook paranoia is starting to eclipse my Google paranoia.


Imagine giving health info to Facebook.


Really strange to see Zuckerberg not bidding over on this. 5c/share is cup change for FB (or Google, of course) but FB's due diligence in the past has been "Zuck had lunch with this CEO, and he had fun so we'll throw in a couple of billion bucks." Maybe FB is maturing as a business. Who knows.


If you listen to Snacks Daily podcast they talked about this weeks ago.


Rising pork price drives up Chinese retail inflation (12/10/2019) ~ Economics

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So piggy never made it to market.


I believe pork is the top protein consumed in China?


I just bought 25 pounds of porc and put it in the freezer. I feel safer now.


Even in the US, pork is so expensive that my local grocery store stopped selling pork breakfast sausage. You can only get chicken sausage now, which is inferior.


How come pork is so cheap in china compared to other meat sources? Is it because of government subsidy?


Fed QE4 could happen before year end, Credit Suisse says (12/10/2019) ~ Finance

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Ermmm I thought we were already on QE4? So this is QE4 on steroid?


FYI, Zoltan Pozsar predicted the repo issues and he's a, if not the, shadow banking expert.


The Fed balance sheet has been GROWING again since this past quarter. They couldn't even get a chance to reduce the balance sheet by 1 trillion. Now these mother fuckers are growing it by nearly 300 billion USD in just 3 months. Might not be exactly QE, but smells like one.


Im new to this section. What does QE4 mean?


Can’t be on QE4 if QE3 never happened


Why was Facebook’s Libra killed off? A blockchain firm advised by Nobel laureate Myron Scholes just launched a rival to Facebook’s Libra (12/11/2019) ~ Investing

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Marky mark tried to put his hand in uncle sam’s cookie jar.


Keep in mind that Myron Scholes was one of the geniuses behind LTCM. Anything with his name on it will probably attract a fair amount of scrutiny.


When was libra killed off?


It's not killed off, they have a test net up which has been continuously updated and work on it


This is an ad for the company.


Pound surges and UK stocks hit record high after Boris Johnson wins Tory landslide. FTSE 250 jumps to all-time high on hopes that Brexit uncertainty will come to an end (12/13/2019) ~ Economics

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I guess we know which way the money voted in yesterday's election.


Brexit is not anywhere close to an end, though.


I want to understand how is it that the markets are happy about this, when the part that won is the one who is pushing for a hard Brexit.


Seems like the doom and gloom from this wasnt quite as bad as predicted. I think this exit will be painful in the medium term as it has been (just look T the pound) but longer term may be better as the EU struggles with negative rates and persistently stubborn low growth


oh hello chaos!


Yes, Fossil Fuel Subsidies Are Real, Destructive And Protected By Lobbying (12/10/2019) ~ Economics

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I really wish people would stop using lobbying and just use the more accurate term "bribing policy makers"


There aren't actually many fossil fuel subsidies. There are standard business capital deductions that every business get and fossil fuels being capitol intensive industries benefit from them. Then there are unpaid externalities like pollution. Also not a subsidy.


Okay.. now what?


Tax breaks are not subsidies.


As If Fossil Fuel Subsidies are the only Subsidies in the U.S.


Here’s the hard-money call for why the boom in the economy and stock market will continue (12/9/2019) ~ Stock Market

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So basically their analysis is that interest rates have further to fall therefore the stock market will continue to go higher? Gosh remember back in the day when people would talk about fundamentals, now it's all interest rates and pumping FIAT money into the market Remember, the gains sustained in the S&P in 2019 have come from multiple expansion only, not earnings or dividends, but simply multiple expansion aka stocks getting more expensive without growth


Keep feeding the junkie all the heroin, itll be fine, he hasnt overdosed yet...


Mainstream Media keeps calling for a recession but the capital flows into the US and Canada say exactly the opposite. Money is seeking shelter from Europe - that's where the actual problem is brewing. Buy US and Canadian stocks and sleep well for the next decade as the world around us collapses.


So just cut interest rates to hide the true nature of the economy?


So in other words the market is crashing?


Human vs Robo Investing? (12/8/2019) ~ Investing

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1.8% is absolute robbery, just do a 3 fund portfolio.


Highly advise switching, or at the very least searching elsewhere. 1.8% is ridiculous. If you don't feel like you can run your own 3 fund portfolio, and don't want to completely go with a robo-advisor, there's a few in-between steps you could consider: Vanguard's Personal Advisor services (0.30%) are robo-based, but include access to an advisor (need at least $50K to open). Betterment's premium option (0.40%) also gives you access to their network of advisors (need at least $100K to open).


1.8% is robery unless it's because of minimum fees. Either way, I would go with robo over 1.8%.


Depends on a number of factors. Being a taxable account there are certainly a number of tax strategies that can save you enough money to cover the fee (tax loss harvesting, capital gain distribution avoidance.. ect). If you have a significant amount of money in the account or are in a high tax bracket this could be a big factor that robo investing won’t do. Keep in mind most people on Reddit are on the younger side and have most of there money in 401ks or IRAs so index or robo investing makes sense but this is not the rule. Just like anything, you pay for what you get. Certainly you want to ask them what they are doing and shop around for cost comparison but it’ll be dependent on your own situation whether it is worth it or not.


1.8% seems excessive today. Back at the turn of the century we would get 3% and not get down to 1.8% until the account was over $10 million. Today most start at 1.0%, maybe a bit more for accounts less than $1 million. One option if you need and are comfortable taking investment advice is to do a search among friends and family for a registered investment advisor nearby. Generally they will be somebody that worked very successfully for the large firms for a time and then went out and hung out their own shingle. At a large investment house the advisor has a hard time getting 40% of the fees you are charged. As an independent the advisor can capture the majority of the fees charged. That gives both them and you a break on costs. Making a 1% fee generous for both of you. And many of these folks are very good and absolutely are worth that level of fee particularly for a client that has other things to do than watch the markets all day every day.


Trump Signs Off U.S.-China Trade Deal to Avert December Tariffs (12/12/2019) ~ Investing

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> The terms have been agreed but the legal text has not yet been finalized, the people said I bet by Monday Trump will declare that there is "no deal in sight" for China and the tariffs will kick in for January.


People losing it over a deal that simply delays tariffs for a bit more. Sure next week he will tweet about how he is doubling the tariffs now


Phase 1 done. How many phases are left?


The trade war has been a complete waste of time and resources if that's all it takes for trump to bend over.


Trump, "I am altering the deal, pray I do not alter it any further."


Bought Disney options, messed up badly (12/10/2019) ~ Investing

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"I figure I wanna reduce the risk of a bad Star Wars 9" You're considerably overcomplicating what should be a comfortable and straightforward long-term investment by hedging something that is already likely baked in at this point. If you manage to do well with this, great but buying Disney and then trying to use options to hedge the potential risk of a movie that is only two weeks away is not something I'd at all recommend.


You know this is going to get reposted. You bought 10 protective puts for your 10 shares.


I thought options were in sets of 100.


Lmao You bought 10 Shares Then you bought 10 Calls A Call gives you the **Option** to buy 100 Shares at the Strike price (this one being 144) On or Before Dec 27. So effectively you leveraged your way up to 1010 Shares of Disney with a very quickly approaching expiry for 1000 of those shares (10 Calls X 100 Shares per call). For you to breakeven here, you need Disney Share price to be at $144.00 + $3.16 = 147.16 on Dec 27th. You make profit if the price of Disney approaches or exceeds $147.16 before or on Dec 27th. Just an FYI, one Call or one Put is based on 100 Shares. So to hedge your current position of 10 Shares you just need 1 Put, which would have also been an over hedge, and you would have made money if DIS would have gone down, even if your shares were worth less. If you do not get rid of those calls soon, you are likely to find yourself out of the $3160, you spent for them if Disney does not get to $147.16). The final price of the Calls being: $DIS current Price minus $144, If this number is negative, then the price is 0.


Options are priced in lots or 100 shares. If you owned 10 shares of Disney and wanted a protective put you would be over protected with 1 , 10 puts would cover 1000 shares


‘Staggering’ New Data Shows Income of Top 1% Has Grown 100 Times Faster Than Bottom 50% Since 1970 (12/9/2019) ~ Economics

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That same bullshit study. These are the jokesters that decided not to include EITC when analyzing tax burdens lmao


This political garbage shouldn’t be posted here.


Careful with small denominators If the top 1% had grown 0.01% and the bottom 0.000001%, it would appear much worse by this stat. Or a bank advertising they pay 20X as much interest when the offer 0.2% interest rather than 0.01%. True, but not really meaningful.


Large compensatory inequalities aren't necessarily unfair. What we need to look at is if the inequalities are justified by comparative advantages. That tells us if the inequalities are fair or not.


It just needs logarithmic scale you idiots


Refinancing surges as homeowners pull out the most cash in 12 years (12/9/2019) ~ Economics

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It is absolutely crazy not to refinance right now. Money will never be this cheap again in our lifetimes.


Here we go again. Groundhog day.


broke as fuck and still trying to figure out that "their" tax cut


Here are Bank of America’s top 10 investing themes to watch over the next decade (12/13/2019) ~ Stock Market

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Honestly these issues are nothing new and we are dealing with them currently. For example everyone is talking about recession now and the possibility of recession in 2020 or beyond. Robotics and self driving cars are already on the road, drones are delivering packages for Amazon etc. climate change is here for real so nothing new tbh. So if you know how to play these issues in the context of stock markets then you shouldn’t have any issues


Is there an unbiased definition for moral capitalism, it sound quite subjective.


Can someone ELI5 what "quantitative failure" is? After some skimming, it sounds like it's basically the central banks being forced into a position where they can't do their jobs any more?


Interesting from a investing point of view. Depressing as fuck from a humanitarian view.


The death of QE? Bold assumption.


Want to compare percentage ownership of total wealth, assets, liabbilities, and other categories across different generations, education levels, races, household wealth, and household income? Well, the Fed has a fun tool for that. (12/14/2019) ~ Economics

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Ran across this site the other day and find it really fascinating to utilize. The site provides some interesting, easily accessible statistics. Use the 'Wealth Component' and 'Distribution' drop-downs to change what is being compared.


Wow.. wealth share of those under 40 from ~13% to 6.6%.


Great tool. This is the links the belong on this sub. Look at the wealth distribution by education level. College degree has gone from 50% to almost 75% since the mid 90s. Got to go play some more with this. Thanks for the link.


I think it would be interesting to weight the generation/age groups by headcount. I don't see how comparing, for example, 19 years of boomers vs 15 years of Xers is useful. Cool tool nonetheless.


When I look at levels rather than percentages, is that adjusted for inflation or not? It's not obvious on mobile. EDIT: Adjusted for inflation or not, it looks like literally everyone is significantly better off than they were 30 years ago. All races, education levels, and income brackets. Nice.


Don’t Let China Win the Green Race – China is threatening the leadership of America in clean energy. This should not be allowed to happen. In many ways, we aren’t even trying. (12/9/2019) ~ Economics

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I get why we should try to beat China - in the name of friendly competition, responsibility to the environment, and profits. However, the article and headline are anti-China for nationalistic reasons and I have to ask: shouldn’t we be encouraging everyone, including China (who pollutes quite a bit) to invest in clean energy? A clean China is beneficial to the whole world. This shrill anti-China no matter what discourse is not helpful and plain irresponsible coming from the NYT.


China makes and buys 4X as many electric cars as the US China’s total renewable energy capacity is 750 GW (US is 250 GW)


So what if anyone wins a green race? Thank god we’re even fucking trying


The NYT has been a rag for quite some time now.


Vote the Republicans out.


Gen X has never recovered from the 2008 recession (12/13/2019) ~ Economics

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Some of us never got our footing after the fake recovery of the housing fraud era


Anecdotes don't prove anything. This article is based on the experience of a single person. This is very weak content for a sub called /r/economics. You can't make bold, broad statements such as "an entire generation never recovered from 2008" based on a single anecdote. The claim might be true, but this article proves nothing. Does the fact Mark Zuckerberg is a billionaire prove that all millennials are super rich? Of course not. The same is true for whatever this Vox journalist is going through.


i was like "uh thats not true" then I realized it was Vox...


I am doing alright. I am living.


I was fine and I am still fine but I can’t still can’t sell my condo for what I bought it, close though. So I guess I count.


Exclusive: U.S. Army will fund rare earths plant for weapons development (12/11/2019) ~ Economics

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Makes sense. I am sure the Chinese can pull these things out the ground at a very good price, of course the areas that they do it in are environmental catastrophes. Having a domestic supply is smart.


Good. We should be investing in domestic production.


Yep. Just like steel this industry should be protected for national defense.


This is excellent. When you tie this in with the Japanese finding a massive rare earths metal, this is excellent and dire news for one of the few edges they had over the US in the sense of the trade war. I do know however that the edge of the Chinese rare metals advantage has been being reduced as technology and deposits are found in other countries. Gotta love the global market.


With $REMX being in deep toilet only the military can invest in anything of this sort.


Homebody in a Hoodie: Hedge Fund Founder Builds Quant Paradise (12/8/2019) ~ Stock Market

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Trophy wife, though, so not too different. I assume he's also smart enough to have a rock solid prenup.


His wife’s face is nightmare fuel. Jesus I don’t get why so many already-hot women get work done that makes them look like manakins.


but its a supreme hoodie...


but, it's a zip hoodie


These are the people that kill themselves when the market inevitably tanks


Is it possible that U.S will have a great depression again to remove all their debts? (12/10/2019) ~ Stock Market

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They will likely inflate their way out of it. Aka, increase inflation so that the dollar decreases in value and therefore it's easier to pay off debts denominated in pre-inflation dollars.


To add to what others have terms of “inflating your way out of it” the best way to try and conceptualize this would be that you the government need to get money to finance your programs. You go look for someone to buy your bond. The Federal Reserve says they’ll buy it and they give you the money. But the federal reserve essentially created the “money” out of thin air. So the money supply increased and so did the level of debt. This all sounds very weird, but the important piece is that there is now more money in the system which, according to traditional economic theory, increases the inflation rate. An increase in the inflation rate would mean that a dollar tomorrow is worth less than a dollar today because it purchases fewer golds and services. So, to answer your question....maybe. If this is what happens we could see a depression or a greater disparity in wealth than we have today. But the scenario above could also result in mediocre economic output for an extended period of time. Not a depression but more like everything is “fine.” Where things just keep moving but there aren’t drastic changes to the economy and productivity improves but very slowly. OR we don’t get to this point at all and the planet melts, or Hong Kong protests turn into a full scale war, or all student loans default at the same time, or there is some natural disaster, or a major economy collapses. The reality is that we can think in abstract terms of what might happen in the scenario you talk about, but that assumes a world that more or less doesn’t change for an extended period of time for that to happen.


>they do not intend to *ever* pay it back ~~in at least a century (a very long time)~~ .


or another 9/11


They don't have to pay it all back, they just have to stay current (although it can be argued that it will be increasingly difficult to do so eventually). They also have to maintain a defecit for the most part, as consistently having a trade surplus would slowly drain the world of US dollars and it would no longer be a viable reserve currency. So the need to maintain a defecit most of the time naturally means debt inevitably has to increase (e.g. if you keep spending more than you earn year after year after year, you can't reasonably expect to pay off your debt).


GF broke up with me but I have a few thing financially that I need help with (12/10/2019) ~ Personal Finance

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You two have to refinance the car each of you drives. Otherwise If you co-signed on their car they could stop paying and you become responsible. To other Redditors: this is why you don’t co-sign on anything with someone you are not married to (unless helping your kid and you can afford it if they can’t pay)


I'm not an expert on this but you should remember this for the future. Never, *ever* co-sign on a loan unless you are willing to cover the entire thing yourself. No exceptions. Be it family, your girlfriend, whatever. Just don't do it.


You and her will have to work together to separate the titles. My initial inclination is that they will need to be refinanced and retitled (assuming that you were each co-signers on the leases and titles). If not, you might get a phone call in a few years saying that you need to pay off her vehicle.


If you and your ex can keep your differences out of this situation, you will be alright. My ex and I broke up in 2018 and we bought a house together, which we sold and split the leftovers evenly. Everything went smooth. Had we brought every argument and petty behavior into the process of selling the house, it would have been a hellish process. Be adults.


When I dumped my four year relationship I had co-signed his new truck. Being a coward and a burning-bridges type of human, I did exactly 0 to deal with it. I’m very lucky he is a man with integrity/honor. He handled everything himself and snail mailed me the documents even though I behaved immaturely. You may not be so lucky


Can you make a living off of investing in S&P? (12/8/2019) ~ Investing

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The "passive income" comes from establishing a withdrawal rate. A widely established "safe withdrawal rate" is 3-4% per annum. The market historically moves up 7% per year, so withdrawing 3-4% per year allows you to get good growth without ever touching the initial sum whilst also cashing out a tidy profit. If the sum is big enough, it can definitely be enough to make a living. Depending on your expenses and your time horizon, you can modify the withdrawal rate to something else. You ideally want it to be under 7% unless you expect to die soon and have no dependants/loved ones.


You seem to think its impossible to sell less than 100% of your shares.


There are two things you have to consider: * Dividends of your index fund; * The principal (i.e. what you invested). The current yield of SPY, the most famous of the S&P 500 index funds, is 1.75%. This value changes a bit every year, but right now it means that each year you get back 1.75% of the money you invested. For $250k that's about $4400. But then you have the entire amount as well, the money doesn't disappear and it actually grows (on average) 7% a year. This means that if you start with your $250k, never invest another cent other than the yearly yield and do that for 20 years, you'll have about $1 million. At that point you get about $16k per year just on the yield alone. And, because of the historical 7% gains, you can safely withdraw a small portion of those funds (way less than 7%, because when a downturn comes you need a safety margin). Some people consider 4% a safe withdrawal rate (SWR), others opt for more conservative values, like 3%. That means that out of that $1MM you can actually sell $30k and use that in any way you can. Either live off of that, or complement your salary/pension at that point...


Investors already forgot how volatile and panic one year ago but alone prior loses. Consider this ***2018 -6.21%***, 2015 -0.73%, 2008 -38.5%, 2000-2002 3 years lost -10.4 to -23.4% each year.


>but when do you actually sell and cash out? When I want to buy something and I don't have enough cash.


Could asset concentration be the reason why we have lower interest rates and low inflation during a time of economic expansion, rising markets? (12/14/2019) ~ Investing

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Wealth concentration is largely generational when you take it at-large across the economy. Millenials are entering the workforce or just entering prime years -> debt from education, big ticket purchases like cars and homes. GenX is in their prime productive years but a relatively small generation. Boomers are either in retirement or about to enter retirement, with significant assets, investments, and paid down debts. This is such a large generation that it has created a "savings glut". There are more old people with money than young people who need money. This money hunts down yield and drives interest rates lower. Cost of capital being so cheap and an aging population helps drive surpluses in supply and tamp down on inflation. In regards to the Fed lowering interest rates, there actually were/are significant signs of distress. Even without the trade war the business cycle was aging. But you have business investment coming in weak which is a good indicator of a possible slowdown. Manufacturing entered a recession and may have turned the corner recently but it's hard to know for sure yet. The trade uncertainty not only in the US but in the UK is making it difficult for businesses to make long term plans. Distresses like this take time to actually work themselves down to the economy and considering the weak inflation, the Fed has correctly weighed the risk of a recession as more important than the risk of inflation. I don't think they did enough soon enough, but at least they identified the problem before shit hit the fan. At this point I do think the Fed Funds Rate is at a good point to sit and hold for about 6 months. On another note, the domestic boom in fracked oil and natural gas has led to unprecedented stability and cheap energy prices. Energy finds its way into just about every product and the cheaper it is the lower inflation will be.


Companies are also using all their record piles of cash to make record buybacks on their stock instead of hiring anyone.


> . Lets say the Fed/Govt minted a $1 trillion bill and gave it to an individual citizen, with no strings attached. How would this impact the economy? I would imagine that we would see what we see today. Most of that trillion would end up in bonds and equities, driving down interest rates, and driving the S&P higher... with little impact on inflation nationwide. That's what would happen if they gave it to rich citizens. Rich people have a low marginal propensity to consume. Money given to them mostly returns to the financial system and has little impact on inflation. Poor people on the other hand have unmet needs for actual stuff. They have a very high propensity to consume. The money would mostly leave the financial system rather quickly and turn into purchases of goods and services. Moreover X's spending is Y's income. So you get a multiplier on spending which is substantially higher than 1 (I think for the USA as a whole 1.52 but likely for the poor and closer to 1.8). So if we have the entire trillion to the poor it would boost GDP by say $1.6 trillion or so (they do save some). That's about 8.25% gdp growth. That's enough to create an employment surge likely of about 4.1-5.25%. We would see a sharp rise in workforce participation and a drop in the unemployment rate. But that number is probably too high regardless, there isn't that much slack. A rise that large couldn't be met. Just giving a $1t to poor people would have been smarter in 2009 when there was that much slack, something like $300b makes a lot more sense now. So in today's economy we would see tremendous competition for resources and likely you would some inflation particularly in wages. That drives investment up as companies need to boost productivity and we have a healthy supply constrained economy again. In short even a slight deconcentration of wealth would create strong growth in the current situation. The economy is off balance. It wouldn't take much at all to bring it into balance.


>Compare that to $1 trillion being created by the fed and issued via a one time ~$5000 stimulus check for every person in America. I have a feeling this would put major pressure on inflation, and interest rates would go up. The economist Milton Friedman conducted a similar thought experiment (in the 1960s I think) and wrote a paper on it, he concluded based on his assumptions (pretty similar to yours actually) that it would not be inflationary and that it would be economically stimulative.


Low inflation is a direct result of the many tailwinds Americans faced this past year. One is the domestic control the US government has over energy prices. Never before had the US been a major exporter of energy. The second was the tariff and Phase 1 talk, and the third had been a rising dollar with the only 1st world economy on firm footing. Going forward I can see inflation flying past 2%. The talking heads will say a lower dollar will increase EPS, but in fact it will just increase all the input costs that will push prices up, and it'll be at least a year before other economies start to show growth on valuation models. Energy prices will stay muted, maybe food as well cause Trump can control those, but the discretionary goods should rise.


How rich Chinese students with huge allowances are reshaping the West’s retail scenes, creating an industry aimed at marketing goods to them | South China Morning Post (12/9/2019) ~ Economics

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Lmfao all the chinese girls I've met who were "rich" just had these massive allowances from their parents that the post references. And their parents were often over extending like crazy. They spend like they are multimillionaires when they are really just well off. Bad finances, not extravagant wealth.


my friend used to date this chinese girl and she thought i was a poor person because i was still using cash lol. i mean, im poor, but cmon bruh


Lol, was in the downtown Audi dealership trying to work out a deal (not successful). Asian college student, maybe 20 years old, comes in and just starts yelling in a heavy accent (to no one in particular, just the show room floor): “IS MY NEW CONVERTIBLE READY?! MY DAD SAID I COULD JUST DROP IN AND PICK IT UP!” Manager comes out, says hi, etc. Five minutes later her brand new convertible is out front and the keys are in her hand. She was noticeably put out by having to wait a whole five minutes, lol. Salesperson (to me): “We can’t discount anything - they always pay full price no questions asked” motioning to the student. Strange world we live in.


Wish I was a rich Chinese girl that gets large allowance


If I were getting $37K a year for spending money... I’d save most of it.


2019: The year the Federal Reserve admitted it was wrong (12/13/2019) ~ Economics

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More like the fed acted appropriately but economic conditions worsened due to trade policy, causing them to reverse course.


The post election recession is gonna be CRAAAAAZY


the Phillips curve was disproven this year... we really don't know what we don't know I'm glad that Powell has admitted as much


I actually can’t wait for Donald to get re-elected again. I want to see how he bullshits and blames the worse recession since 1929 on Obummer.


Abolish the Fed


Where will the S&P 500 go in 2020? Here are the most bullish and bearish strategists (12/11/2019) ~ Stock Market

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It will probably maybe go up. Could possibly also go down. There’s also could be a chance it goes sideways.


I'm expecting it will go in an ellipse, until it learns how to trace a perfect circle.


Nobody knows this, completely speculation. The best prognosticators I've seen can only measure such predictions eight weeks max IF there are no major catalysts.


Beargang is on the scene. Dalio says that he had concerns and the volatility patterns of common stocks are widening. Once good companies e.g. Amazon are showing lower returns and even in the case of Amazon quarterly losses. Trump has pushed the S&P too far and we are in for a big crash. Open to other opinions though.


Not sure why everyone is joking around. The S&P500 will go up 7% in 2020