Like Wall Street is already doing. Can’t have a pile of assetts like that without blowflies.
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It’ll happen much more quickly. Old people are poor- especially after they can’t work any longer - and older people are dying sooner now than previously. Life expectancy has started to decrease.
Their medical expenses rise every year. People lose homes - and die younger.
But don’t feel sorry - you’re next.
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Uh - okay.
“ Only 10 percent of boomer-age workers can expect income from defined-benefit programs. Less than two decades ago, more than half retired with pension income.” -AARP
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Housing as an investment has destroyed this country. It’s taken food out of kid’s mouths, ruined lives, and vastly affected family formation.
Didn’t need to happen. When Boomers entered the market they were fighting 20% mortgage rates - which slowed them only slightly. In response, they just purchased smaller/better engineered homes. Family formation was mostly unaffected.
So IMO, the greatest real estate killer has been those government guaranteed loans put in place to help people. None of that worked. Free flowing credit and credit tax benefits just allowed speculators to bid up housing out of the reach of families - actually causing harming.
It’s long overdue to wind down these federal programs and tax deductions - replacing all of it with a child tax credit. While no one can guarantee those funds will actually go to protecting kids - it’s still probably the only thing which could help families recover. That and a solid minimum wage + immigration controls.
The only group benefiting from the current system are wealthy individuals usually without children. In the 1950s - children cost parents ZERO. Read again - it’s true. The government picked up the entire cost of maintaining a child.
That expense is sizable. Believe the FDA has kept stats for 60 years.
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No. I was born in 1952 - clearly a “boomer”. I have owned homes since 1971 and I have never faced mortgage rates like what you are speculating upon. My current rate is 3.25% and I have about a year to go on it before its fully paid.
Me thinks you don’t know what you’re talking about.
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That 2008 collapse was strong medicine. Wonder if the same fat faces would have remained on top had we let the whole thing blow 
Would have been painful, but the vast bulk of us really had nothing to lose. Recognize the “restart” might have been difficult once fear set in. Then again, had most people gone back to a cash basis - only the paper investors would have lost. They would have been holding promises worth a whole lot of nothing. If consumption could have been sustained - those would be the only losers.
The money changers…
I hope young families can profit from the collapse coming. Certainly is their turn to grab things.
Young who bought into the myth with borrowed money - they’re ruined. Especially with student loans.
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Oh I know. Never said it was wrong. Just feels icky.
Wow… so two examples - my own folks, one died at 60, so that’s out. The other parent is still alive, living off social security with medicare (newly remarried) with a subsidized apartment. She’s living on the margins, but doing okay - barring another major emergency. We’ve already bought her a car and helped her get this place and get on medicare and deal with social security.
Another example, my friend’s parents, both now retired college profs, who when given the option to switch to a 401k in the 90s stuck with their pension, and are relatively wealthy. I suspect they are far and away the exception while my mother is the rule for many boomers.
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The demolishment of the pension system by the financial industry is one of the greatest crimes of the last half century.
I remember a study - given equal financial resources in s pension and a retirement account - those with the pension had greater satisfaction and less worry. I guess constantly worrying over how long your diminishing asset will last and what will be left when you’re oldest and least able isn’t very conducive to a happier old age. Just as people suggest a minimum guaranteed income can improve the quality of life for younger people.
The pensions that are left need to be protected and expanded where possible. And social security has to not just be protected but expanded. The 401k experiment was a dismal failure - in every age cohort - very few people can survive on what projected assets will be or that are now.
Private industry has no interest in seeing that surplus equipment gets cared for; that’s what the trash heap is for.
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For my friend’s parents, I can certainly say that’s the case. They are sitting on easy street, and have been able to take care of their kids, grandkids, and his parents (only his mother is still alive) as well. it helps that they are kind and generous people to a fault. He set up a scholarship at the college he taught at for minority students, and she set up an education programs in biology for under privileged kids. They are excellent people, which helps explain how excellent their kid (my friend) is.
100% agree.
Why do you hate our freedoms, Kathy, WHY? /s
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Because freedom isn’t free? 
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I’ve said this before: the private pension system in the US was never that great. It was great if you worked for the same company for your whole life and got promoted into a management position before retiring – that matters a lot when your benefit is based on your salary at retirement. Steep vesting schedules and lack of portability meant that people who had to change jobs or change careers were frequently left with much less. Working women and racial minorities were much more likely to be in this situation. And partner benefits only applies to traditional marriage so if your family structure didn’t match expectations your were denied significant benefits. Pensions also disproportionately benefit those with higher life expectancy – again wealthy whites win here.
None of these problems are insurmountable, and most have been solved to some extent in other countries. But I don’t think idolizing mid century pensions is helpful.
We also have a decent pension system in the US, and it is completely portable between jobs and doesn’t depend on your employer or union at all. It is called social security. Rather than trying to recreate a private pension system we should just beef up social security a so that an average worker can live a modest retirement on that alone. We can then keep private retirement accounts like IRAs and 401ks as supplemental retirement savings. If people want to buy annuities with those savings for additional guaranteed income that is fine.
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There was a middle ground between Prince Bush’s no-strings bailout and the “let it all burn” approach. But since that middle ground would have involved the government telling private businesses how to apply the funds and, worse, re-imposing regulations gutted during the era of St. Ronnie and his successors (Clinton included), it was easier to present the rubes with that bogus black-and-white option.
Ummm, interesting choice of term there. And not just because the modern American Xtianists who support Il Douche and/or the GOP establishment would have had JC arrested for flipping tables back in the day.
The problem wasn’t with wanting to own a home or wanting to have a post-secondary education, but rather that the desire for the first was twisted into a speculative bubble and the second desire turned into a way to funnel money to administrators and marketers and sports facilities (or worse, to investors in fake for-profit schools) rather than educators. Due the neoliberal “securitise ALL the things!” mentality driving both trends, costs skyrocketed out of reach and the usual quick-buck predators were waiting to offer easy credit to unqualified borrowers.
Citiation needed.
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Well said. Thank you. If people are going to handcuff themselves to a pyramid scheme, then it should probably be a government pyramid scheme with some hope of a long-term guarantee, i.e., social security.
I don’t understand the love affair with old school private pensions. People shouldn’t have to commit to the same employer for a lifetime to get a decent retirement fund.
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Neither pensions nor social security are pyramid schemes.
They’re simple actuarial calculations that work just fine for bonds, mortgages and insurance.
The problem is government not enforcing the contributions be made - like they do other compensation- and keeping the accounts inviolable as they do with defined contribution plans.
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Just a clarification that Social Security could provide a good framework for a decent state pension system, assuming proper funding.
I say this because we have one deranged regular and oft-banned commenter on the site who regularly derails topics in part because he doesn’t understand the difference between SSI (the I standing for “not being left homeless and eating catfood in your 70s” insurance) and a state pension system like that in the UK.
The idea that private retirement accounts like IRAs and 401ks could be flipped to serve the insurance role instead of SSI is an interesting one.
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I guess that is my issue. Those calculations are fine until they aren’t. Or until a company with good lobbyists and lawyers decides they can’t abide by those calculations. Actuarial tables are not facts, they’re probabilities.
True that, but corporations are not long-lived entities. See Bezos’s comment about Amazon going bankrupt someday. There is too much opportunity for unfortunate intervention in private pensions. They were a short-lived crutch for people decades ago.
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Yeah, I’d feel a lot better about a state pension. I’ve heard too many stories of private companies’ pensions getting raided to help the business when it inevitably starts to struggle. Of course, bankruptcy protection works to relieve the execs, er, I mean the company, from pesky obligations like pensions and employment contracts, so I’m thinking that relying on private pensions is way risky. That, and the issue of portability, too.
Getting back to the topic at hand, in my suburban neighborhood, homes that were built in the early 1950s, there are many older, retired folks that still live in those homes. Interestingly enough, there are three households on my street whose adult children live nearby. The elderly folks will soon start to pass (it already started happening), and I’m wondering what will happen. I have a feeling that the adult children are going to just move back into their childhood home, and if they own a house nearby (even on the same street in two of those cases), then their kids will just stay in their childhood home.
In another 10 years, we’ll know how it plays out, but that’s my prediction. Housing here in the south bay area of California is way too expensive for those grandkids to even start thinking about buying anything on their own.
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Yes! This is precisely what is already happening in my city. Investors foreign and domestic are buying up homes, keeping inventory historically low, raising rents in response to high demand stimulated by low inventory, and the cycle continues. Builders are cutting every corner possible to meet demand, while their skilled labor force is struggling to pay their rent and can’t buy a home. These homes are built in such a way that many are remodeled as soon as they are purchased because the finishes are such low quality. Our industrial properties are being converted into restaurants and bars, replacing good paying jobs with part time minimum wage jobs. Infrastructure designed for manufacturing is being used to service these yuppie playgrounds and tax payers are funding the roads’ expansion and maintenance. Entry level homes are highly competitive in the 280’s and up. It’s quite a mess, and a sign of what’s to come.
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Did you call trump “il douche”? I’m…I’m going to just steal that, sorry.
Also on the 0 cost thing, someone gave a citation, but I didn’t bother to click it, as there would have to be so many asterisks and qualifications that it would be, at the very best, partially true.
Il douche, I love it.
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