| ▲ | Epa095 4 days ago |
| Feel free to look at dividend yields, but I can pretty much guarantee that it has not halfed in the period the stock market doubled. Most likely it stayed relatively flat, somewhere between 1.5% and 2%. So if you had 100 million you would get 1.7 million as dividend 5-7 years ago, now it's roughly doubled, without selling any of your stocks. Not that it really matters. Given how much faster the stock market grows compared to salaries you can sell a few percentages of your wealth every year, and still get richerer by doing nothing besides owning. |
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| ▲ | gruez 4 days ago | parent | next [-] |
| >Feel free to look at dividend yields, but I can pretty much guarantee that it has not halfed in the period the stock market doubled. Most likely it stayed relatively flat, somewhere between 1.5% and 2%. Eyeballing this chart it looks like it dropped around a third since the pandemic. https://ritholtz.com/wp-content/uploads/2021/09/spx-div-yld.... https://ycharts.com/indicators/sp_500_dividend_yield |
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| ▲ | grafmax 4 days ago | parent | next [-] | | If yields stay the same actual dividends still grow in a rising market. Of course dividends aren’t a good representation of increased wealth. Stock price + dividends is. Companies generate profit which gets added to the balance sheet or paid out as dividends. It’s basically two ways of accounting for the same income (with some minor differences like tax implications). | |
| ▲ | Epa095 4 days ago | parent | prev | next [-] | | (First, I apologise that this message must be hasty, I must do life stuff). I really feel like your first graph proves my point? OK, at times it goes up, at times it goes down. But since 2002 the dividend is the same, but the S&P 500 is 7x. So the lazy capitalist puting in 10 million there in 2002 got 132k in yearly 'income' then, now he gets 925k yearly. You wanna figure out how much average salary increased the same period? I am willing to bet it's closer to 2 than 7. And that shows who gets the fruit of our increased productivity. Owners. | | |
| ▲ | ziofill 4 days ago | parent [-] | | I fully agree. Additionally, stock price is driven also by expectations of further growth, which in order to keep happening, something's gotta give so it must chip away at quality of the final product too (cheaper materials, cheaper manufacturing, etc) with a consequent enshittification. My parents, who live in Italy, could afford a stone house from the 1800s in their thirties. I live in Canada and everything's made of wood and snot and and costs a fortune. | | |
| ▲ | nradov 4 days ago | parent | next [-] | | In most places, residential real estate prices are driven mainly by land values rather than construction quality. But if you want to live in Italy they're literally giving away free houses. https://www.cnn.com/2024/11/19/travel/italian-village-ollola... | |
| ▲ | gruez 4 days ago | parent | prev | next [-] | | >I fully agree. Additionally, stock price is driven also by expectations of further growth, which in order to keep happening, something's gotta give so it must chip away at quality of the final product too (cheaper materials, cheaper manufacturing, etc) with a consequent enshittification. ??? You're omitting some steps here. While "enshittification" probably happens to some extent, it's unhinged to suggest that's the only explanation for growth, as opposed to more mundane explanations like "better technology". >My parents, who live in Italy, could afford a stone house from the 1800s in their thirties. I live in Canada and everything's made of wood and snot and and costs a fortune. Seems like a stretch to blame this on "enshittification" when North American houses have been made of wood for centuries. | | |
| ▲ | ziofill 3 days ago | parent [-] | | I didn’t mean it’s the only explanation, but it sure is a knob that companies use to tune “growth” (or fake growth, for that matter), among other things like better technology. |
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| ▲ | WalterBright 4 days ago | parent | prev [-] | | Just for fun, watch a movie from the 30s, 40s, 50s, etc., and take a look at the interiors of houses. We've got a lot better today, and a lot more of it. Even watch an episode of Dynasty (about rich people). Look at the crappy TV in the corner. I remember taking my last CRT TV to the recycler. I was sure glad to be rid of it. | | |
| ▲ | Epa095 3 days ago | parent | next [-] | | Notice that I am not saying that labour is not getting more purchasing power, just that owners is getting more quicker. Luckily our increase in productivity is high enough that both can get more in absolute terms, although owners gets a larger part of the growing cake. | |
| ▲ | OnlineGladiator 4 days ago | parent | prev [-] | | You realize you're an enormously privileged, wealthy individual telling other people that don't have your wealth and privilege how they should feel the same as you? You don't even say "in my experience" you just condescend to others that they should recognize how great the world is for the 0.1%, completely unaware that it isn't great for people that can't afford food and housing. Nobody gives a shit about their TV when they're hungry on the street. | | |
| ▲ | WalterBright 4 days ago | parent [-] | | I was born into a lower middle class family with several siblings. My dad skirted bankruptcy. My first car literally came from a junkyard in pieces, bought with money I earned from my paper route. Hardly 0.1%. (I didn't know how bad things were for him until I went through his papers after he died.) I began investing with my first real job, with another crappy car I repaired with junkyard parts. A good friend of mine grew up in a family that qualified for welfare but wouldn't accept it. He didn't get past high school. He managed to make himself $10m before his tragic death. Yes, the US is the land of opportunity. Other countries can emulate it if they want to. A couple years ago, I booked an Uber ride. The driver was a refugee from Afghanistan. He arrived in the US with nothing but his skin. Within a few months he had a thriving business, driving the Uber in whatever extra time he had left. It was fun talking to him - he was hella ambitious! | | |
| ▲ | OnlineGladiator 4 days ago | parent [-] | | Setting aside everything else I'd normally say, I do respect that you make an earnest attempt to engage with almost anyone. | | |
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| ▲ | cma 4 days ago | parent | prev [-] | | Most companies moved to stock buybacks instead of dividends for tax reasons. |
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| ▲ | prasadjoglekar 4 days ago | parent | prev | next [-] |
| This is the definition of an asset bubble in my books. In 2007 +/-, this is exactly what happened with housing prices. People would buy an asset and watch it appreciate doing nothing. Why go to your forklift operator job at Home Depot if you can make $50K per year in asset appreciation by sitting and doing nothing? |
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| ▲ | WalterBright 4 days ago | parent | prev [-] |
| Keep in mind that anyone can buy stock. And stocks in the US historically outperform passive real estate investing. |
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| ▲ | UncleMeat 4 days ago | parent | next [-] | | Anybody can legally buy stock. It is substantially more difficult to acquire a large amount of stock if you don't earn a lot of money, since there is naturally far less leftover after your expenses are paid. And further, stock can be purchased with dividend payments. So the rich can afford an ever increasing piece of the pie even if they don't labor at all. | | |
| ▲ | WalterBright 4 days ago | parent [-] | | It's amazing how much you can accumulate by steady investment, and reinvesting what you have. |
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| ▲ | cool_dude85 4 days ago | parent | prev [-] | | Careful with "can". It is possible for the homeless guy on the corner to buy stock in the sense that he is not prohibited from doing so. But on the other hand, the actual fact is that he can not purchase stock. | | |
| ▲ | grafmax 4 days ago | parent [-] | | Right, ability to buy stock is predicated on having the money to do it, after paying for basic necessities. People who work for a living have less money than those who don’t. So when stock prices rise, even workers who can save see less absolute benefit than owners. | | |
| ▲ | WalterBright 4 days ago | parent [-] | | You can buy fractional shares from robinhood for $10. The internet has brought a great democratization of access to the stock market. If you don't have an investment program, the best time to start is right now. | | |
| ▲ | cool_dude85 4 days ago | parent | next [-] | | But this is not meaningful. If I buy 10 dollars of stock, at 10% return I am earning 1 dollar per year. This amount is not relevant to my life in any way and is probably dwarfed by variation in the amount of cash I find lying on the ground annually. It's like saying everyone has access to clean water, look over there, there's a drop. | |
| ▲ | grafmax 4 days ago | parent | prev [-] | | The point is that workers have far less money to save. Therefore when stocks go up due to increased productivity, even workers who have enough money to save still don’t benefit, in absolute terms, as much as owners. | | |
| ▲ | WalterBright 4 days ago | parent [-] | | Becoming an owner by founding a company is the way to reach the top tier. Jobs, Gates, Bezos, Musk, etc. BTW, I know a person who worked as a fruit picker as a young man, he's now a multimillionaire. And a woman who grew up in a mobile home who is now worth 9 figures. America is a great country. P.S. my first business was selling greeting cards door to door. | | |
| ▲ | grafmax 4 days ago | parent [-] | | Unfortunately our society’s structure is such that only a small number of people can ever be wealthy. They do this by belonging to the ownership class. There is not enough room there for everyone, because owners make money simply through owning, because others do the work for them, while the owners pay themselves with the profits these workers generate for them. | | |
| ▲ | WalterBright 4 days ago | parent [-] | | > Unfortunately our society’s structure is such that only a small number of people can ever be wealthy. History says otherwise. The mass immigration to the US in the 1800s was all poor people arriving with nothing but a suitcase. They moved up into the middle class and beyond en masse. Middle class people live better than medieval kings. | | |
| ▲ | grafmax 3 days ago | parent | next [-] | | Living standards have risen due to productivity gains being distributed across society. Factors such as wise policy and labor unions contributed to this effect. These factors are largely absent today. Productivity gains have flowed mostly to the ownership class since the mid 1970s (this is the pay-productivity gap). As the article notes, 50% of people identify groceries as a major cause of stress, which doesn’t sound like a medieval king. Society has the capacity to make life better for everyone. It requires collective action to redistribute wealth from the ownership class across society however. Even raising living standards for the poor through redistribution wouldn’t solve all our problems. Concentration of wealth is itself a net negative because it is concentration of power. Greater wealth concentration makes society more undemocratic, even if the bottom 50% were to become richer. Today billionaires have so much money that a group of them has gotten together to fund the abandonment of democracy in the US. They are largely succeeding. We are collapsing into “illiberal democracy” - a phenomenon that has been spreading across the globe in recent years. Our greatest problems, like climate change, worsen as wealthy interests prop up policies of denial rather than effective solutions. A medieval king had political control. If society was heading in a direction that was going to harm them, they could do something about it. But members of the modern day middle class have virtually no political control. That is concentrated in the hands of the few and harms us all. | |
| ▲ | TFYS 4 days ago | parent | prev [-] | | That's not the definition of wealthy. Wealthy is a relative term. It's meaningless to say that a lower middle class person today is wealthy just because people 500 years ago could only dream of the things they have. If other people in the society they currently live in have a million times more, they are not wealthy. I'm sure you understand how capitalism works. If you do, you should understand that not everyone can be an owner, someone has to do the actual work. | | |
| ▲ | WalterBright 3 days ago | parent [-] | | > not everyone can be an owner Anyone with $10 and a phone can be an owner of the means of production (by buying stock). > It's meaningless to say The meaning is the massive improvement in the standard of living due to free markets. BTW, if being "poor" means being in the bottom quintile of income, there will always be "poor" people, regardless of how well they live. | | |
| ▲ | TFYS 3 days ago | parent [-] | | That's like saying anyone with legs can be a professional runner. In theory yes, but not in practice, not in a meaningful way. Defining poverty as bottom quintile is also useless, yes. Defining poverty by comparing to the average or median income is the most useful definition. Someone earning less than half of average, for example. That tells you how well they can afford the limited resources of any society, as those track the average purchasing power. |
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