Results 1 to 40 of 290

Thread: Thoughts on Jordan Peterson

Hybrid View

  1. #1
    Raver's Avatar
    Join Date
    Dec 2005
    TIM
    Ne-IEE 6w7 sp/sx
    Posts
    4,899
    Mentioned
    221 Post(s)
    Tagged
    3 Thread(s)

    Default

    Quote Originally Posted by COOL AND MANLY View Post
    http://www.in2013dollars.com/1910-do...010?amount=100

    2275% cumulative inflation rate in a 100 year period. That is around 3% inflation rate per year. From 1910 to 2010.

    http://www.pewresearch.org/wp-conten...e_adjusted.png

    Your second picture practically says salaries increased slightly when we adjust for inflation. Meaning they are keeping up with inflation. How is this an argument in your favour?

    http://www.in2013dollars.com/1964-do...18?amount=2.50

    Basically income increased 4% per year on average from 1964 to 2018.

    House cost in 1958 is $11,975 according to your sources. Average income: $4,650 per year.

    I'm not sure how you did your math but that is not a third of your salary. It's more than double/triple your salary. It's actually insanely similar to the current situation.

    Sorry for not replying earlier. I didn't want to involve myself in your conversation with Ave. I like to hear others thoughts even when we disagree. I enjoyed reading your exchange.
    No worries on the late response, I'm glad you enjoyed it. Anyways, that was a typo on my part, I meant to say that the salary covers about a third of the housing cost, which is actually very different than today. I'll use different examples to illustrate my point because the main issue comes down to largely the cost of living in purchasing homes and condos rather than the cost of other items.



    If you divide the cost of a new house with the average salary in 1953 like so:

    9,525 / 4,011 = 2.37

    It amounts to roughly the cost of a house being 2.37 times greater than a yearly salary.

    Let's fast forward 30 years to see the difference:



    82,600 / 21,073 = 3.91

    The cost of a new house in 1983 was 3.91 times greater than the average yearly salary, which is a noticeable increase from being 2.37 times greater in 1953.

    Now, let's fast forward to roughly the present day, which is 35 years later to illustrate my point further:

    Let's look at October 2018, where the average American household income was $63,220:

    https://seekingalpha.com/article/423...usehold-income

    Also, the cost of a new American house in October 2018 was $395,000:

    https://www.census.gov/construction/...uspricemon.pdf

    So if we do the math, it is:

    395,000 / 63,220 = 6.25

    The average cost of a house in the US in 2018 was 6.25 times greater than the average US household salary in 2018, which is a big difference compared to 3.91 times greater in 1983 and 2.37 times greater in 1953. It would be important to note that the difference is significantly greater between the average US home and the average US salary if you go to American cities with ludicrous housing costs like San Francisco, New York and Seattle. However, it's only fair that I use the average US housing cost of the nation as a whole and not the average housing cost of those US cities. So basically my point is that salaries are not keeping with the rising cost of inflation specifically with the purchase of homes and condos.

    Salaries may be keeping up with inflation in terms of purchasing of other items, but I think it's safe to say that the most important factor for quality of life and standard of living is the homes and condos we are able to afford to purchase. In some cities, the cost of homes and condos are still reasonable, but unfortunately in other cities they are far too expensive. This shows how slowly over time, the poor and the middle class will find affordable housing to purchase more difficult to come by as time goes by as the slow increase of housing costs is not something that our salaries are keeping up with, which means our standard of living is slowly decreasing over time.

    This only benefits the 1% that are easily able to profit off the increasing housing costs, for which they sell once the price increases or simply allow lower class citizens to rent. Let's not forget another important factor here. In 1953, it was typical of the majority of households to have the husband working with one salary to provide the income for the entire family, while the wife provided at home. In 1983, you were more likely to find women working to help provide for the household and family compared to 1953, but still not as much as today. Finally, in 2018 it is safe to say that the majority of women help provide an income for the family along with the men.

    So not only have housing prices increased considerably compared to the household salary, we now need two incomes instead of one income like we did in 1953 to provide for the family making the problem even worse than it appears. Some say the income disparity occurred due to the increase of the labor market from women entering the workforce, but that is another debate in and of itself and this situation could have other factors contributing. Also, to be fair I used the household income in 2018 rather than a single income in 2018, which would of revealed a greater disparity between the average income and the cost of new homes.
    Last edited by Raver; 01-10-2019 at 05:33 AM.
    “We cannot change the cards we are dealt, just how we play the hand.” Randy Pausch

    Ne-IEE
    6w7 sp/sx
    6w7-9w1-4w5

  2. #2
    Ryan's Avatar
    Join Date
    Nov 2011
    TIM
    Your daul
    Posts
    1,549
    Mentioned
    67 Post(s)
    Tagged
    0 Thread(s)

    Default

    Quote Originally Posted by Raver View Post
    No worries on the late response, I'm glad you enjoyed it. Anyways, that was a typo on my part, I meant to say that the salary covers about a third of the housing cost, which is actually very different than today. I'll use different examples to illustrate my point because the main issue comes down to largely the cost of living in purchasing homes and condos rather than the cost of other items.



    If you divide the cost of a new house with the average salary in 1953 like so:

    9,525 / 4,011 = 2.37

    It amounts to roughly the cost of a house being 2.37 times greater than a yearly salary.

    Let's fast forward 30 years to see the difference:



    82,600 / 21,073 = 3.91

    The cost of a new house in 1983 was 3.91 times greater than the average yearly salary, which is a noticeable increase from being 2.37 times greater in 1953.

    Now, let's fast forward to roughly the present day, which is 35 years later to illustrate my point further:

    Let's look at October 2018, where the average American household income was $63,220:

    https://seekingalpha.com/article/423...usehold-income

    Also, the cost of a new American house in October 2018 was $395,000:

    https://www.census.gov/construction/...uspricemon.pdf

    So if we do the math, it is:

    395,000 / 63,220 = 6.25

    The average cost of a house in the US in 2018 was 6.25 times greater than the average US household salary in 2018, which is a big difference compared to 3.91 times greater in 1983 and 2.37 times greater in 1953. It would be important to note that the difference is significantly greater between the average US home and the average US salary if you go to American cities with ludicrous housing costs like San Francisco, New York and Seattle. However, it's only fair that I use the average US housing cost of the nation as a whole and not the average housing cost of those US cities. So basically my point is that salaries are not keeping with the rising cost of inflation specifically with the purchase of homes and condos.

    Salaries may be keeping up with inflation in terms of purchasing of other items, but I think it's safe to say that the most important factor for quality of life and standard of living is the homes and condos we are able to afford to purchase. In some cities, the cost of homes and condos are still reasonable, but unfortunately in other cities they are far too expensive. This shows how slowly over time, the poor and the middle class will find affordable housing to purchase more difficult to come by as time goes by as the slow increase of housing costs is not something that our salaries are keeping up with, which means our standard of living is slowly decreasing over time.

    This only benefits the 1% that are easily able to profit off the increasing housing costs, for which they sell once the price increases or simply allow lower class citizens to rent. Let's not forget another important factor here. In 1953, it was typical of the majority of households to have the husband working with one salary to provide the income for the entire family, while the wife provided at home. In 1983, you were more likely to find women working to help provide for the household and family compared to 1953, but still not as much as today. Finally, in 2018 it is safe to say that the majority of women help provide an income for the family along with the men.

    So not only have housing prices increased considerably compared to the household salary, we now need two incomes instead of one income like we did in 1953 to provide for the family making the problem even worse than it appears. Some say the income disparity occurred due to the increase of the labor market from women entering the workforce, but that is another debate in and of itself and this situation could have other factors contributing. Also, to be fair I used the household income in 2018 rather than a single income in 2018, which would of revealed a greater disparity between the average income and the cost of new homes.
    I won't write a long response since this is taking too much of my time than I'd like.

    I'd just like to note that you didn't account for:

    1. House size: The average size of a new house in the US has doubled since 1960. The average Canadian or American each has double the residential space of the average UK, Spanish, or Italian resident.
    2. Population: continues to increase but many big cities are already saturated, supply and demand pressure is there. Lots of investments are still flowing there and most high paid jobs are in big cities, thus driving pricing even higher.
    3. Interest rates: are very low, people paid up to 20 percent in the 80s. Long dated mortgages of 15, 20 and longer years started in the mid 1930s. Private mortgage insurance started up in 1957 with the Mortgage Guaranty Insurance Company. Those innovations brought home ownership to the masses – no longer did you have to be able to afford a huge, short term loan with a massive down payment. That is a huge discount on house costs.

    I still believe it's just a matter of adjusting expectations and having financial discipline. Most people can afford to be home owners. But I'm not going to spend more time on this topic. Cheers.

  3. #3
    Raver's Avatar
    Join Date
    Dec 2005
    TIM
    Ne-IEE 6w7 sp/sx
    Posts
    4,899
    Mentioned
    221 Post(s)
    Tagged
    3 Thread(s)

    Default

    Quote Originally Posted by COOL AND MANLY View Post
    I won't write a long response since this is taking too much of my time than I'd like.

    I'd just like to note that you didn't account for:

    1. House size: The average size of a new house in the US has doubled since 1960. The average Canadian or American each has double the residential space of the average UK, Spanish, or Italian resident.
    2. Population: continues to increase but many big cities are already saturated, supply and demand pressure is there. Lots of investments are still flowing there and most high paid jobs are in big cities, thus driving pricing even higher.
    3. Interest rates: are very low, people paid up to 20 percent in the 80s. Long dated mortgages of 15, 20 and longer years started in the mid 1930s. Private mortgage insurance started up in 1957 with the Mortgage Guaranty Insurance Company. Those innovations brought home ownership to the masses – no longer did you have to be able to afford a huge, short term loan with a massive down payment. That is a huge discount on house costs.

    I still believe it's just a matter of adjusting expectations and having financial discipline. Most people can afford to be home owners. But I'm not going to spend more time on this topic. Cheers.
    Fair enough. I am not sure about the US, but in Canada we have townhouses or semi detached homes that are equivalent to small houses of the past and even they are ludicrously expensive even if cheaper compared to single detached homes. Yeah, naturally big cities will have more expensive homes for that reason, which is why I chose to use the average cost of a new home for the country instead.

    Yeah, you bring up a good point with lower interest rates today. I suppose if you paid off the mortgage fast enough in the past it did not matter though, but today it would not be possible with such high house prices. I agree most people can be home or at least condo owners today, it is just that we are forced to purchase smaller homes or downgrade to a condo and save more money than the past like you mentioned. Later!
    “We cannot change the cards we are dealt, just how we play the hand.” Randy Pausch

    Ne-IEE
    6w7 sp/sx
    6w7-9w1-4w5

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •