The SP500 hitting highs is a lot less good news when you realize most of that is simply due to the dollar devaluing against other international currencies.
That isn’t asset appreciation, it’s currency devaluation.
EDIT:
I m on mobile and don’t have the ability to make my own chart with DXY and SP500 normalized to each other, but uh…
https://portfolioslab.com/tools/stock-comparison/^DXY/SPY
Look at this in YTD, then in 1Y, then 5Y.
Normally, these two things move in the same dirrction, though the SP500 tends to grow much more when the DXY grows a little.
Well, now, basicslly since Trump took office, they’re moving in the opposite direction.
So, yeah, this is now what is called a ‘melt up’, where stocks climb higher, but not because of any kind of underlying fundamental strength of the US economy but because the USD has lost about 10% of its value compared to the currencies it most often is traded against.
When the nixon administration abandoned the gold standard, stock prices rose, too. It’s the same mechanism: avoid having cash as the currency devalues.
Is it atypical to learn this in school?
In American schools?
Normal public schools?
Economics is an elective, only available at fairly good schools, usually only taken by overachievers.
Most US Public schools don’t even teach the basics of taxes or finances as it applies to an average person who is going to like, work a job that is taxed, buy a car with a loan.
Our education system has been intentionally destroyed by Republican s for decades, the result is that roughly within +/- 2 years of when I graduated college… US average adult literacy rate has been plummeting.
The average US adult now reads at a 6th grade level, average math skills are also terrible.
Uneducated people are easier to lie to and trick.
What does nth grade reading level even mean? Why doesn’t it get corrected to an average of what is actual? In the context of adults I can understand, but I think I’ve heard things like Xrh graders having an average reading level as Yth graders. But if the average reading level of Xth grades is something (like some amount of words), why isn’t that what an Xth grade reading level is?
I hope that makes sense. Like if you everyone how their school experience is and they all believe they had a “worse than average” experience, clearly about half are incorrect.
What does nth grade reading level even mean?
Very broadly, a lower grade of reading level means:
Less broad vocabularly,
Less ability to use and comprehend more complex grammar and sentence structure,
Less critical analysis capability,
Less ability to understand context and domain specific, different meanings of words,
More reliance on nebulouy defined, vague slang vocabulary.
In the context of adults I can understand, but I think I’ve heard things like Xrh graders having an average reading level as Yth graders.
This means that say, a typical 8th grader now has reading/writing abilities on par with a 6th grader.
In other words, kids keep failing classes and getting passed onto the next grade anyway, instead of being held back, or sent into some kind of ‘catch-up’ or ‘remedial’ classes to get them up to standard.
…
Teachers and the education system broadly have, you know, rubrics, standards, lists of concepts that a kid is supposed to be taught in each class and grade.
This is how ‘grading’ works, the idea is that your test is supposed to evaluate how successful the student was at learning, how succesful the course was at actually teaching the student new concepts.
The main problem is that we underfund teachers and schools, and also punish teachers and schools when they actually do the right thing and refuse to pretend a kid has learned things they haven’t.
So, the result is, kids don’t learn.
…
Semi-relevant rant about smart phones in the class room
Another recent contributor to this is just pandemic levels of kids on their phones in class, all the time, not paying attention.
What you should do is something like ok, if I see your phone in class once, it gets taken away for the rest of the class, two times, the rest of the day, 3 times, you have to surrender your phone to the office when you get to school and get it back when school is over.
But students and parents literally respond like feral zombies when you propose this, despite this being the norm throughout the proliferation of cellphones, and early days of smartphones.
There’s nothing stopping you from using a phone responsibly. Set it on vibrate, if you get an actual important txt or call, ask to step outside the class and take the call/message.
Schools also have landline phones for emergencies.
Another thing is that short form video content addiction does actually cause brainrot, it is real, its been shown in numerous academic studies.
Lower attention spans, lower impulse control, less control over emotions, and shortform video content platforms in particular also spread misinfo and disinfo like wildfire.
The average US adult now reads at a 6th grade level
Read this statistic recently, and while not surprising, it is shocking. I remember when I was young, the average was an 8th grade reading level. And I thought that was terrible.
I had an 8th grade reading level in the 4th grade for crying out loud, meaning the average American reads at a lower level than I could in elementary school.
Where’d this stat come from. Looking around and another site says 25% made payments for groceries. Another site says 60% split payments when buying - not just for groceries. So I sincerely doubt the stat of 60% making payments just for groceries.
Canadian here, what’s “AfterPay”? and PLEASE don’t tell me it’s like layaway or a payday loan or something.
Yeah, basically a payday loan you can do from your phone. I’m sure this won’t crash the economy.
Okay.
It’s an app. Can’t tell you any more than that.
That’s exactly what it is.
By “trickle down”, they meant “pissing in your mouth, peasants”, FYI.
No, that’s disgusting.
Trickle-down is a perfectly wholesome synonym for horse-and-sparrow economics, so named because sparrows pick undigested oats out of horseshit. Why’d you have to go and make it gross?
“Thank you my liege”
Unironically, it used to be called “Horse and Sparrow Economics,” with the rich eating grains, and the poors pecking their meals from the horseshit.
True story
That’s by design, the money flows from the average American to the companies. Then slowly trickles into the pockets of the ceo’s.
Money is just abstracted fungiblized value.
It’s stealing more of the value you produce. Me@ning you get less
Until chains of debt guilt and terror make you effectively a slave.
“Slowly”
Slowly as in, the Niagara falls slowly trickle water.
What? You can pay using your ass?
Daily reminder that “higher GDP is good for the economy” is now a wildly disproven myth from the days before economics was a science, by a guy who said we’d get a 15 hour work week.
Monetary inflation is bad. The nitwits who jump in saying “ackchually velocity” are suckers who paid to learn the lie, whose jobs may depend on the lie, and would be very embarrassed to be wrong. Bailouts weren’t the exception - they’re the rule.
We’ve been robbed by the 0.1% and don’t need to take it anymore.
Adding to this: GDP only measures the amount of money spent on stuff, not the actual value of the things. That’s one of the reasons that makes economists think untouched nature is bad, it doesn’t contribute to the GDP
Two economists are walking in the woods when they see a pile of bear shit.
One says to the other “I’ll pay you $500 to pick up that shit.”
The other agrees, but immediately regrets it. He says he’ll pay the other $500 to take it from him. The other agrees.
The first thinks for a moment and says to the second “I think we’re both worse off than before we started this walk.”
The second, hands full of bear shit, is shocked and yells “What do you mean, we just increased the GDP by $1000!”
before economics was a science
So… When is that gonna happen?
it never trickles down.
Username checks out.
Weird stat aside, I was watching a podcast with Scott Galloway yesterday and he made a comment about Jerome Powell bringing inflation down to 2% without triggering a recession, and I had to facepalm. The rich, even those with a shred of empathy, are massively out of touch with what the 99% are experiencing right now.
Sadly, Americans are groomed at a young age to dive deep into debt early in life. It has become normalized for most of the population to carry some form of debt (credit cards and student loans are popular choices).
Most people don’t even bother making a budget — a task that only needs to be done once a month, and is easier now than ever, thanks to technology.
Try and make a budget for minimum wage. Many people can’t afford to live even meagerly.
Why bother budgeting if you’re just going to lose anyway?
Oh it trickles down. Just not money, but at least it’s warm and golden 🙏
Me, off in the corner believing debt is immoral
Society legitimately cannot function without debt. I agree giving people predatory “micro loans” for groceries is dystopian but every society that has discovered agriculture has also discovered the concept of debt because it’s a natural consequence of an economic order so tied to seasonal cycles. Interest is also not bad, and every society that has developed debt has also quickly developed interest. Societies that have religious prohibitions or taboos against interest find workarounds because it’s proven to be a critical part of how economics works. Personally I am glad that I was able to buy a house for hundreds of thousands of dollars I don’t have yet because I will be able to pay off that in time and I appreciate that the bank is willing to lend me that money for such a long time at a relatively low rate of return for them. The Soviet Union even had banks that offered loans with interest but they were run by the State. It’s kind of unavoidable.
Are you thinking about usury? Debt in general is actually one of the moat important threads of our societal fabric
It’s not important, it’s the cornerstone of modern society. It’s a really bad cornerstone though, like great filter level bad
What problem does it solve that couldn’t be better solved in another way?
Well, it solves the problem of “I’m 25 years old with a decent paying job but no saved up capital, and need to buy <house/car/etc.>”. Without taking on debt, I would need to save up for years to buy this stuff, but by taking on debt I can buy it now and “save up” (i.e. pay back) over the next years.
By all means, loans should be regulated in order to prevent people from taking on debt they can’t afford, and to prevent/punish predatory practices. Debt in and of itself however can be a very good thing.
I have an apartment and a car now, with down-payments that I can afford without huge problems. Without taking a loan it probably would have taken me 25 years to be able to afford this. Except I wouldn’t have, because the money I’m now using for down-payments would instead have gone to paying rent.
That’s not a problem, that’s a short cut.
In exchange for you being able to buy things before you can afford them, they’re priced so it would take decades to save up.
Because if anyone sells their future, everyone has to if they want to compete
In exchange for you being able to buy things before you can afford them, they’re priced so it would take decades to save up.
To some degree, you’re probably right. However, no matter how you look at it, building an apartment complex or even a single house, costs much more resources than what most people have saved up at any given time. So no. It’s not just a matter of “competing” or that things are over-priced. Large infrastructure is just expensive to build, because it costs a bunch of man hours and materials to build it.
I totally agree. But no individual should be building an apartment complex, should they? Who should build it? The city, the community, the future occupants… People should get together and put their money in a pile
This should not be an investment to extract rent and profit, it should be an investment today into the future, not through debt, but to plant trees for the future
Houses are too expensive to build as an individual? Then we’re doing something wrong. Maybe we don’t run electricity to every corner. Maybe we build them out of stone, so they last forever. Maybe we make them out of wood and plaster so they can last centuries. Maybe we make them out of glorified paper, so they’re easy to build. Maybe we don’t have central air, but use passive cooling and run an AC to certain rooms. Maybe they should be smaller and easier to build
There are other ways of doing things, better ways that will mean slower progress but stability
You shouldn’t be able to leverage the future, we should always be investing into tomorrow today
There is literally no way you will build a decent modern house without thousands of man-hours, only in the construction itself. That’s before you count the hours needed for getting the materials you need.
It’s unreasonable to posit that we should design our society such that you need to save up enough money to finance something like that up-front in order to build a house. Why not go for the (current) solution, where I can loan money to finance the house, then pay that back once I have stable living conditions (because I now have a house)?
