What's wrong with people.

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  • Malthusian
    Malthusian Posts: 10,898
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    The idea that the economy depends on people spending and not saving is nonsense. All savings get spent eventually.

    In the meantime the money you save either gets lent out to somebody else (which they spend, and meanwhile the bank spends the interest, and the bank's staff spend their salaries) or invested in businesses (which they spend, etc etc).

    The money keeps circulating around the economy either way. But if people save and sensibly invest it does more good. And if people are secure in retirement, there's less need for the government to seize people's money to redistribute it to the elderly, meaning less dead weight loss, meaning more money to go around.

    I absolutely love my life

    Apparently not, or you wouldn't worry so much about how other people live theirs.

    You need some more things to care about that you can actually make a difference to.
  • jack_pott wrote: »
    No we wouldn't, we'd have more money to spend on the things we do need.


    Yes we would its excess spending and debt which is keeping the country going.
  • Despite earning big money, why are some people in big debt and have no savings.

    I think it's definitely a psychological thing. I had parents who were professionals & earned very good money, but never had any money, because while they are both intelligent people they are financially illiterate. Money was just wasted on needless things and quite often financial problems would crop up.

    The experience as a child changed my whole mindset and as an adult I've saved & invested with every pay rise. Just added up my latest total and im around £200,000 after 12 years....and it really was very easy! I don't earn big money (just above minimum wage) I did have a small inheritance and have done well with my investments.

    The key is not to chase the posh cars/clothes/phones. I absolutely love my life, I live it to the full but that money gives me so much security and happiness you wouldn't believe. I know that if I want I can walk out of work tomorrow I can, it gives you choices. And that security is worth far more than material things.

    As others have said it's important to live life and enjoy it, we only come this way once, but what I don't understand is why most people haven't "seen the light" (time is precious, we don't have much so why spend most of our life at work to buy things that make us feel better about going to work, which then results in us having to be at work almost forever) I work with people who hate work, are desperate to leave but have no prospect of ever being able to become they are driving the posh car, the designer clothes etc

    It seems so simple to me...but why have so few seen the light?

    Brilliant post. I just wish everyone would read this and see the light.

    It's not often that I feel exactly in tune with someone else's thinking. This is a rare experience. Thank you.
  • Yes we would its excess spending and debt which is keeping the country going.

    No it isn't. The global economy is like a giant conveyor belt digging resources out of mines at one end, and dumping them in landfill at the other, and the object of economic growth is just to make it go 2% faster each year.

    Throwing a TV away after 3 years instead of 6 isn't increasing wealth, it's just wasting labour and materials that could be used to make real improvements in wealth.

    In Luxury Fever, economics professor Robert Frank explains how changing from taxing income to taxing expenditure would free up huge quantities of capital for investment whilst still allowing for status competition.
  • Thank you for the interesting replies.

    To those who think I am somehow "bragging" I can only apologise. That certainly wasn't my intention, and comparatively to some posters on here what I have is small change, however it's interesting to see how others view things. I just feel sorry when I see people debt laden and in a financial mess & the reality is its not that difficult, with time and perseverance to become secure. Granted many will never achieve FI but when you read that big percentages of people don't even have enough saved to last a month if they lost their jobs....can't be good for society or the economy.
  • JohnRo
    JohnRo Posts: 2,887
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    jack_pott wrote: »
    The answer lies in understanding the psychology of status competition, because a consumer society is just a society in which consumption is the primary means of competing for status...

    I think the superficial image has become an increasingly conspicuous consumable and far more important now than it has ever been in the past, I'm probably talking nonsense but I think in my experience 'looking good' is now becoming paramount. The younger generation are suffering the pressures of that in a way I don't recall ever feeling or really seeing, so I do have some sympathy for the younger generation feeling the need to have those nice things and to look that good.

    Being frugal is a tough ask in a world where commercialisation bombards images of vacuous successful people with no discernible talent beyond a superficially attractive image and an artificial micro celebrity 'brand', willing to subject themselves to the baying mob, being able to exploit things like the social media phenomenon, make a good sponsored living from it and live apparent perfect lives.

    Me, I know my place.
    'We don't need to be smarter than the rest; we need to be more disciplined than the rest.' - WB
  • Glen_Clark
    Glen_Clark Posts: 4,397 Forumite
    jack_pott wrote: »
    In Luxury Fever, economics professor Robert Frank explains how changing from taxing income to taxing expenditure would free up huge quantities of capital for investment whilst still allowing for status competition.
    Thats what they have been doing for 30 years. I think it was Sir Geoffrey Howe who really developed the wheeze of reducing income tax and replacing it with stealth taxes (20% VAT... Insurance Premium Tax... Tax on building sand we dredge from the sea bed etc etc) Succesive governments have carried it on.
    Its a sneaky way of increasing inequality whilst presenting it as something else. Every time they increase the income tax threshold by £1,000 they say its to reduce tax for the low paid. But of course the lowest paid weren't paying income tax anyway, but will be hammered by the stealth taxes the Government slips in to replace income tax. Even the guy sleeping in a cardboard box pays stealth taxes. Those earning a bit more will save £1,000 x the basic rate. But those who save the most are the highest paid saving £1,000 x ther highest rate. Yet the Government aided by the right wing press presents it as help for the low paid. Brilliant.
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
  • Glen_Clark
    Glen_Clark Posts: 4,397 Forumite
    ..and massively inflated house prices due to the credit bubble that all these debt junkies were encouraged into by the banks....
    Inflated housing costs are more to do with restricting production of new homes with (allegedly) the worlds most onerous planning system. QE, easy credit and low interest rates didn't inflate the price of consumer goods because production of those wasn't restricted by UK Government intervention in the market.
    Most countries have their own idiocy of choice, and ours is that high housing costs are a good thing. Successfull economies like Germany can't understand the British obsession with house prices.
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
  • JohnRo wrote: »
    I think the superficial image has become an increasingly conspicuous consumable and far more important now than it has ever been in the past, I'm probably talking nonsense but I think in my experience 'looking good' is now becoming paramount. The younger generation are suffering the pressures of that in a way I don't recall ever feeling or really seeing, so I do have some sympathy for the younger generation feeling the need to have those nice things and to look that good.

    Being frugal is a tough ask in a world where commercialisation bombards images of vacuous successful people with no discernible talent beyond a superficially attractive image and an artificial micro celebrity 'brand', willing to subject themselves to the baying mob, being able to exploit things like the social media phenomenon, make a good sponsored living from it and live apparent perfect lives.

    Me, I know my place.

    I agree, its much more extreme now than ever before. It's incredibly easy to get swept up into the consumerist way of thinking. However once you have your eyes opened to it you can see it for what it is... a total waste and completely pointless.
  • Zola.
    Zola. Posts: 2,204
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    I think Social Media has caused a huge upsurge in people becoming more reckless with money. Everyone wants to look wealthy and show off, and what better way than to flaunt the next holiday you are on, the new flashy car or the new Rolex watch to the X number followers on your social media accounts.

    Look at guys like Conor McGregor, a huge global star, always flaunting and bleating on about how rich he is, a sickening show off. People try to copy him or be him. Look at how many copy cat McGregor suits there are. People growing beards and buying checkered suits haha.
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