Bro it's so easy just save 20% of what you need above and beyond the basics of an upper middle class living, like maybe take one fewer trip to Bali each year, or cut back to only two cars per person, or timeshare your pool.

As an ex-Apple engineer who grew up with four generations living in a duplex, and as someone who now sees people struggling with grocery and gas prices and utility prices, I feel like more people even having any disposable income at all might be a better start.

Adam Smith observed in his famous book that when people get more money they almost always spend it on a better place to live.

I have observed people from the very poor homeless all the way up to multi-millionaires - his observation hold true for the vast majority. Nearly all of them are living paycheck to paycheck despite the massive amount of difference in income.

When you are young investing in education - that is tuition - is the correct call. When you finish school though many people stop investing at all instead of investing in equities.

How exactly are young people betrayed by the system supposed to get that disposable income? I live in country with highest unemployment rate in OECD. We have tons of people with master's degree unable to find ANY job, let alone something that would fit their education. There's fierce competition for jobs like part-time warehouse worker or cashier.

Only thing I can think of is moving abroad, but sending lots of young people abroad is not very sustainable from a domestic economy perspective.

If we all had a significant sum auto-invested in an early age, we'd all have a stake in preserving the practices that are causing so many problems. I don't wanna live in a broken world forever, so I'm kind of glad that we don't.

Do you mean disposable income or discretionary income?

Because taking 20% of the former leaves a lot of the population unable to pay for essential living expenses because they effectively have zero of the latter.

"Profit requires you to keep showing up. It goes to zero if you stop producing or innovating, and yields diminishing returns as others learn to duplicate or improve on your approach – so you have to keep learning and improving, too. Profit “belongs to the living” because it requires flow: you profit by generating value in a game with moving targets."

They didn't say the words, but they sure painted the picture (plus the usual Marxist game of moving the meaning of words around to keep the grift going).

For those in denial:

Modern Capitalism Is Weirder Than You Think: It also no longer works as advertised

https://nymag.com/intelligencer/2022/03/how-asset-managers-h...

(https://archive.is/wSmtd)

You don't have to reference Marx to be using the same incorrect logic has he used.

I would surmise no such thing! I think the far simpler explanation is either that renters are ignorant of housing economics, or that they have other priorities that override reducing market rents. Having talked with many renters, I think the former explanation carries most of the weight, with a little of the latter mixed in.

Or rather that democracy is easily influenced by a trillion dollar brainwashing industry

Wouldn't they rather be arbitrarily rich instead?

Generally no, though you won't get this answer directly.

Many people prefer to be rich relative to others than arbitrarily rich. If you ask a bunch of random folks if they'd rather be in the middle class in their current country of residence in 2005, or of noble birth in ~1100 CE, you'll get the latter answer _a lot_ despite that being an objectively worse quality of living.

Economies are naturally deflationary (assuming a fixed money supply); services become more efficient, making capital more productive. This happens more or less automatically within competitive markets. So those capitalists do become arbitrarily rich, limited only by institutional factors (tax, labor bargaining, antitrust enforcement). By restricting access to capital markets you're siloing these gains off into their own pool.

Heh, yea, it seems like these people don't know who Mansa Musa was and that just dropping massive amounts of capital (well, raw gold in this case) into an economy has all kinds of side effects. Wild inflation/deflation is fun!

They get power out of it (restricting the supply of capital).

In neoclassical economics, savings never pay off compared to investment. But in the real world, savings have important advantages:

1. They help you sustain longer in the case of strike (be it labor strike or investment strike).

2. They allow you to react to the market (for example, buying a promising startup winner after a competition consolidation) instead of being a first mover.

3. They allow you to price dump rapidly if a competitor threatens oligopoly pricing (usually the status quo), to drive them out of business.

That's why savings give you an actual power, which increases the richer you are.

Also, in my worldview, savings are liquid/reversible investments, while real capital investments are iliquid/irreversible - if you decide to build a factory you're commiting to an irreversible decision, if you buy an index fund, the decision is reversible, so it's basically savings. Making as few irreversible decisions as you can gives you an edge compared to others.

These are very good ideas for much more of the populace to digest and internalize. I'm not sure how many will.

And much of the popular critique of capitalism is driven by those who don't distinguish between profit and rent, when in fact the near entirely of the extraction that is causing inequality is from rent extraction and not "profit" as used in this piece. Especially when it comes to real estate, which is most people's largest expense, growing, and one of the biggest political challenges we face today. (Broad homeownership has created a lot of people that benefit from increasing residential housing costs, or at least don't see any problems with them).

Glad to see Schumpeter get mentioned, as Schumpeterian rents are perhaps defensible for a while, I think.

The problem with this is that the author has explained capitalism in a way that sounds harrowing to the wider public, but sensible to everyone holding any sort of power. These outcomes aren’t a side effect of the system; they are the system working as intended. Governments and corporations don’t want people that are comfortable and happy, they want people strapped to the yoke. The constant stress is them cracking the whip.

Charging rent on capital was historically called “usury”, and was denounced by everyone from Aristotle to Aquinas, from Moses to Buddha to Muhammad. I suspect they had the right of it, which poses some problems for our present society, fractally composed of usury (as the article aptly outlines).