70% of American own homes, 65% are invested in stocks and bonds!

[SweetPrettyAss]

Actually, you do live in a trail park at the whim of a landlord. You may have a lease, but the lease can be broken if the trailer park is sold [as you pointed out in the first paragraph, above.] Thus, you have some of the benefits of home ownership, but not all. Actually, your situation is somewhat similar to the owner of a condominium.

Another point that should concern the Literotica reader is that you bought what your description indicates was a wreck and you then rehabbed it [good work!] However, the average Literotica reader might not have the skills to do such work [They call me ten thumbs.]

Actually, it would not be that easy to break the lease. A lease is a contract between the property owner (lessor)and the lessee, such as Seacat. If a new owner buys the trailer park (or mobile home park) they are obligated to respect the leases in existence.

If a new owner wanted to use the property for somethng else, they would either have to wait until all the leases had expired, and not renew any or they would have to pay off all the lessees who agreed to leave before the term of the lease expired. This might include finding them a new location and paying for transportation to it, or it might be a straight money payoff.

 

[Huckleman2000]

Although the general thrust lf the thread has focused on home ownership, I really need to point out that the increase in investment ownership due to 401k plans must be considered in view of the offsetting plunge in union membership and pension plan coverage.

The obvious fact is that whatever gains that free-marketeers trumpet for the middle class due to their participation in equity investments, those gains accrue most to the shareholders who own most of the shares, ie, the moneyed rich. The moneyed rich benefit not only from a larger pool of investment income chasing a limited pool of secure investments, thereby driving up share prices, but also because the blue chip companies they've invested in are able to offload existing pension costs to the government while not accruing pension costs on their current books.

This amounts to a huge ripoff of the general working population to the benefit of anyone with a large nestegg. As earlier posts have shown, 90% of shares are owned by 10% of the shareholders. Any investment-based wealth redistribution accrues mainly to those who are already rich. Any union-based (or other worker-based ) wealth redistribution accrues mainly to the middle class. Insofar as the government has guaranteed pension funding, the risk which justifies the higher returns for investors has instead been shifted to the broadest platform of taxpayers.

 

[Guest]

 

[SweetPrettyAss]

Although the general thrust lf the thread has focused on home ownership, I really need to point out that the increase in investment ownership due to 401k plans must be considered in view of the offsetting plunge in union membership and pension plan coverage.

The obvious fact is that whatever gains that free-marketeers trumpet for the middle class due to their participation in equity investments, those gains accrue most to the shareholders who own most of the shares, ie, the moneyed rich. The moneyed rich benefit not only from a larger pool of investment income chasing a limited pool of secure investments, thereby driving up share prices, but also because the blue chip companies they've invested in are able to offload existing pension costs to the government while not accruing pension costs on their current books.

This amounts to a huge ripoff of the general working population to the benefit of anyone with a large nestegg. As earlier posts have shown, 90% of shares are owned by 10% of the shareholders. Any investment-based wealth redistribution accrues mainly to those who are already rich. Any union-based (or other worker-based ) wealth redistribution accrues mainly to the middle class. Insofar as the government has guaranteed pension funding, the risk which justifies the higher returns for investors has instead been shifted to the broadest platform of taxpayers.

I think the biggest stockholders, outside of those who own the stock of closely held corporations, are pension funds and insurance companies and others who receive a lot of cash and need a large amount of liquid assets.

How do blue chip companies offload their pension costs to the government. They have to pay into Social Security and they have to pay into the pensions of their employees, either directly or through the unions. If those pensions are in the form of 401K accounts, the taxes paid to the IRS are delayed, but they are eventually paid.

If I had the choice of having my pension administered by (a.) the government, (b.) the union or (c.) the employer, I would choose (a.) in a flash. Companies sometimes go belly-up, such as Enron. Unions, such as the Teamsters, have been known to rip off the pensions of their own members. Although I don't trust the government very much, they won't go belly-up and are less likely to rip me off.

 

[JamesSD]

Amicus calls for a parade, but it starts to rain

Borrowed from http://www.endgame.org/primer-wealth.html

In the late 1970s, the top one percent of the US population held 13 percent of the wealth; in 1995 it held 38 percent. (Levy, Frank. The New Dollars and Dreams ).

In 1998 the top 1 percent of the population owned 38 percent of the wealth, the top 5 percent owned over 60 percent (source: www.inequality.org/fatcsfr.html).

The top ten percent of the U.S. population owns 81.8 percent of the real estate, 81.2 percent of the stock, and 88 percent of the bonds. (Federal Reserve Bank data in Left Business Observer, No. 72, Apr. 3, 1996, p. 5).

One percent of the U.S. population owns sixty percent of the stock and forty percent of the total wealth. (Hawken, Paul, The Ecology of Commerce: A Declaration of Sustainability. New York: HarperBusiness, 1993).

The top one percent of U.S. households owned 42 percent of all stock in 1997...
The top ten percent of households owned 82 percent of all stock-market wealth...
Only 27 percent of households held more than $10,000 in stock in 1997...
57 percent of Americans didn't own any stock at all...
The top fifth of households saw their income rise 43 percent between 1977 and 1999, while the bottom fifth saw their income fall 9 percent....
Since 1973, every group in society except the top 20 percent has seen its share of the national income decline, with the bottom 20 percent losing the most. They have just 3.6 percent of national income, down from 4.4 percent a quarter century ago.
Indeed, the top fifth now makes more than the rest of the nation combined...
Rebecca Blank, who recently left the President's Council of Economic Advisors, pointed out, ‘We've gone back to levels of income and wealth inequality that this country hasn't seen since the teens and 1920s.’" (Source: Merrill Goozner, Crash of '99?, Salon.com, Oct. 1, 1999).

The top one percent of Americans receive more income than the bottom 40 percent. (Korten, David. When Corporations Rule the World, p. 108).

No wonder there are so many foreign wars... gotta keep the prolitariate distracted.

 

[Pure]

good points, lilred

there is a nice document about foreclosure rates at

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=126128

The Rising Long-Term Trend of Single-Family Mortgage Foreclosure Rates

PETER J. ELMER
Government of the United States of America - Division of Research and Statistics
STEVEN A. SEELIG
Government of the United States of America - Division of Research and Statistics

Roxanne has not introduced any facts or data just a general 'believe in prosperity' 'everything's fine*' 'believe in America' spiel. *(except for the morally deficient).

it appears for single family homes foreclosures are now about 1%, a 9 fold increase since the 50s and a 3 fold increase since 1980.
[that's the first paras of the paper]

(I can't seem to capture the document and reproduce parts here)

there is somewhat of a mystery since the 90s showed growth in employment.

there is a later section on 'household risk,' which is quite informative--
this has to do with investments elsewhere (leveraged by the home equity) and insurance (i.e., its absence). it seems that 401K in some ways may be part of the problem because of its lack of liquidity.

 

[JamesSD]

it appears for single family homes foreclosures are now about 1%, a 9 fold increase since the 50s and a 3 fold increase since 1980.

Homes are also far, FAR larger and more expensive than they were in the 50s. Americans overspend ridiculously. There's an attitude that you should buy the biggest, fanciest home you can afford. Personally, I admire the people that live below their means more than those who live a life of luxury saddled by debt.

 

[Huckleman2000]

I think the biggest stockholders, outside of those who own the stock of closely held corporations, are pension funds and insurance companies and others who receive a lot of cash and need a large amount of liquid assets.

How do blue chip companies offload their pension costs to the government. They have to pay into Social Security and they have to pay into the pensions of their employees, either directly or through the unions. If those pensions are in the form of 401K accounts, the taxes paid to the IRS are delayed, but they are eventually paid.

If I had the choice of having my pension administered by (a.) the government, (b.) the union or (c.) the employer, I would choose (a.) in a flash. Companies sometimes go belly-up, such as Enron. Unions, such as the Teamsters, have been known to rip off the pensions of their own members. Although I don't trust the government very much, they won't go belly-up and are less likely to rip me off.

By offloading their costs to the government, I was referring to the Pension Benefit Guarantee Corporation. Corporations with defined benefit pension plans paid a certain amount to the PBGC to cover retirees in the event of bankruptcy or dissolution of their former employer. Recently, BushCo 'restructured' this government entity so that it could actually cover the projected costs, and in so doing, made it totally unlikely that a business would enter into a defined benefit pension plan.

So, apart from Social Security (which has been on the chopping block of Conservatives for years), only a fraction of the workforce is covered by a pension plan they can count on. Each year, more workers who thought they were covered are redefined into a fraction of what they had been led to believe would be available to them. The airlines and auto industry are the latest high-profile pension defaults.

Simply put, the private sector is reneging on its contractural promises to employees and the US workforce. The government has committed to the US public a minimum level of retirement and healthcare coverage. As less of this is taken up by corporate obligations, retirement poverty will only increase.

Moreover, corporate taxes are a fraction of what they used to be, in terms of government income. This, despite their default on retirement benefits and medical coverage that they had contracturally committed to provide.

Left to its own devices, the private sector has a long history of shifting any societal obligations to the government, while simultaneously seeking to minimize any contributions to the general welfare, whether in terms of infrastructure or human resources. This isn't necessarily bad - companies are supposed to make money, after all.

However, without governmental intervention, capitalism leads to a very small wealthy class and a very large worker class, with a small merchant class of shopowners and the like. Given today's supply-chain optimization and such, the merchant class is no longer viable.

The only times in history where a large middle class has developed, it has been either due to mass die-offs of the working population (such as the Plague), or because of governmental intervention (The New Deal). In the case of the Plague, the shift of economic power led to the Rennaissiance. In the case of the New Deal, the shift led to the American powerhouse that Roxanne, Amicus, et al, inaccurately attribute to their almighty Free Market.

Their baseless faith will be the ruin of the society they hold in such high regard.

from Wikipedia, Pension

Another growing challenge is the recent trend of businesses purposely under-funding their pension schemes in order to push the costs onto the federal government. Bradley Belt, executive director of the PBGC (the Pension Benefit Guaranty Corporation, the federal agency that insures private-sector defined-benefit pension plans in the event of bankruptcy), testified before a congressional hearing in October 2004, “I am particularly concerned with the temptation, and indeed, growing tendency, to use the pension insurance fund as a means to obtain an interest-free and risk-free loan to enable companies to restructure. Unfortunately, the current calculation appears to be that shifting pension liabilities onto other premium payers or potentially taxpayers is the path of least resistance rather than a last resort.”

 

[glynndah]

Do these statistics take into account that some people/companies own multiple houses, i.e., vacation homes, rental properties, etc.? That would skew the findings. For example if one person owns ten houses and the other nine own nothing, that cold be interpreted as 100% home ownership - 10 houses divided by 10 people.

 

[Pure]

yes, i think that's taken into account, since 'households' are identified, then they are asked, do you own or rent.

 

[elsol]

*yawn*

If you're actually interested in the hoopla...

http://www.census.gov/hhes/www/housing/hvs/qtr206/q206tab5.html

Of course, I won't seek to interpret the data, but okay... but 5.8 percent up, I'll be dancing in the street naked tommorrow to celebrate.


I noticed people had some other questions so here's the links to the statistics that answer most of them like condo vs. house (I think it's in here) and 'summer' home vs. living home.

http://www.census.gov/hhes/www/housing/hvs/qtr206/q206ind.html

 

[Huckleman2000]

*yawn*

If you're actually interested in the hoopla...

yup, those people at the Census Bureau know their shit. Census data and also Bureau of Labor Statistics stuff is rock solid for all but the most esoteric applications one could imagine, and they are very upfront and specific about the limitations of the data sets. The definitions take into account more than you'd think of unless you worked with the data every day, and they are very specific as well as comprehensive.

The fly in the ointment, not surprisingly, is when an administration decides to redefine something in order to make some type of political statement. Not long ago, "poverty" was redefined and the poverty rate declined overnight!

These things are all notated, of course, but you get enough of them and it really complicates things when you try to do any analysis. Since economists rely on the data to discern trends and advise companies, such political meddling is really anti-productive. Everyone forgets about it in two weeks, and then complains that economic analysis is so difficult to understand and takes so long.

 

[Roxanne Appleby]

This amounts to a huge ripoff of the general working population to the benefit of anyone with a large nestegg. As earlier posts have shown, 90% of shares are owned by 10% of the shareholders. Any investment-based wealth redistribution accrues mainly to those who are already rich. Any union-based (or other worker-based ) wealth redistribution accrues mainly to the middle class. Insofar as the government has guaranteed pension funding, the risk which justifies the higher returns for investors has instead been shifted to the broadest platform of taxpayers.

Ahem - where do union pension funds invest their money (the part that isn't malinvested through corruption, that is?) Hint - it's not in a mattress. It's in stocks and bond - just like 401Ks and other instruments owned by the individuals.

In your seeming contempt for captitalism and free markets you appear to be really reaching for ways to tear down what has been a wonderful development, one that is making Marx's vision come true: "The workers will own the means of production." Yep - one share at a time.


My eyes are not closed to potential abuses if the system, and my mind is open to ways to address those, but what is going on in this thread is generally just spitting on a system that has created a previously unimaginable standard of living for the vast majority of Americans.

 

[R. Richard]

IIf I had the choice of having my pension administered by (a.) the government, (b.) the union or (c.) the employer, I would choose (a.) in a flash. Companies sometimes go belly-up, such as Enron. Unions, such as the Teamsters, have been known to rip off the pensions of their own members. Although I don't trust the government very much, they won't go belly-up and are less likely to rip me off.

SweetPrettyAss:
You left out the best choice of all, (d.) the guy who is to receive the pension. I have been the administrator for my own pension for the last couple of years. I lack formal training, I lack the licenses that are required of a professional money manager and I have been achieving an over 20% return, year by year.

If they want to turn the management of my pension over to (a.), (b.) or (c.) they will first have to pry my cold, dead fingers off of the stock of my 10 gauge and/or my .475 Wildey. [They will need to bring in outsiders for the job. The locals know of my skill with the 10 gauge and the Wildey.]

 

[Pure]

reply to roxanne's speech

Roxanne said you [evil leftists] are really reaching for ways to tear down what has been a wonderful development that is making Marx's vision come true: "The workers will own the means of production." Yep - one share at a time.

P: There is unfortunately no factual basis for this claim. See below data on weath distribution.

The stock data are for 2001, but are unlikely to have changed toward equity in the last 20 years; this concludion is based on the following statistics for investment income over the last 20 years:

Domhoff: A key factor behind the high concentration of income, and the likely reason that the concentration has been increasing, can be seen by examining the distribution of what is called "capital income": income from capital gains, dividends, interest, and rents. In 2003, just 1% of all households -- those with after-tax incomes averaging $701,500 -- received 57.5% of all capital income, up from 40% in the early 1990s. On the other hand, the bottom 80% received only 12.6% of capital income, down by nearly half since 1983, when the bottom 80% received 23.5%. Figure 5 and Table 6 provide the details.


http://sociology.ucsc.edu/whorulesamerica/power/wealth.html
Domhoff, W. Sociology Dept, U of Cal, Santa Cruz

"Wealth Income and Power"


Statistics based on
Wolff, E. N. (2004). Changes in Household Wealth in the 1980s and 1990s in the U.S. Unpublished manuscript.
Wolff is at NYU.
http://www.levy.org/default.asp?view=publications_view&pubID=fca3a440ee


Distribution of Net Worth, US.
1983

top 1%
33.8%

next 19%
47.5%


bottom 80%
18.7%

===
2001

top 1%
33.4%

next 19%
51.0%

bottom 80%
15.5%


Wealth class and per cent of all stock owned. 2001

Top 1%
33.5%

Next 19%
55.8%

Bottom 80%
10.7%

 

[Roxanne Appleby]

SweetPrettyAss:
You left out the best choice of all, (d.) the guy who is to receive the pension. I have been the administrator for my own pension for the last couple of years. I lack formal training, I lack the licenses that are required of a professional money manager and I have been achieving an over 20% return, year by year.

If they want to turn the management of my pension over to (a.), (b.) or (c.) they will first have to pry my cold, dead fingers off of the stock of my 10 gauge and/or my .475 Wildey. [They will need to bring in outsiders for the job. The locals know of my skill with the 10 gauge and the Wildey.]

Too late - they've already turned your pension over to the government. It takes 12.4 percent of your earnings below $90k, spends it now, and promises to pay you a "pension" that compares very poorly with the historical returns available from prudent, diversified privately invested savings. Unlike a 401K yu don't own anything you can bequeath under this system, and unless you live a good long time after retirement your return may actually be negative. (I have read that becaue of lower life expectancy rates the aggreagate return from Social Security to African Americans is negative - they are subsidizing the rest of the system.)

Oh, and finally, the benefits the politicians have promised vastly exceed the revenue the system can expect to take in, making the whole thing a ponzi scheme.

That is what the government run pension system looks like.

Social Secuirty is the subject of a heated political debate that has been poisoned by rank partisanship. I have noticed that while AH is solidly liberal in general, it is not necessarily statist. Social Security in its current form is a system only a devout statist could love. Should a discussion arise about it in this thread or elsewere, I hope the rank partisanship that has poisoned the broader political debate can be left out if it.

 

[Pure]

cute little heston reference, rr

rr they will first have to pry my cold, dead fingers off of the stock of my 10 gauge and/or my .475 Wildey.

P: the only language liberals, collectivists, and 'statists' understand is hot lead.

 

[Roxanne Appleby]

Roxanne said you [evil leftists] are really reaching for ways to tear down what has been a wonderful development that is making Marx's vision come true: "The workers will own the means of production." Yep - one share at a time.

P: There is unfortunately no factual basis for this claim. See below data on weath distribution.

Ah, so the measure of a system's value depends not on whether the standard of living and wealth of those in the middle or bottom is greater in absolute terms than ever before, but on whether the amount they are doing better exceeds the amount those at the top are doing better.

This suggests that a superior system would be one in which the standard of living of those not at the top was declining, so long as those at the top were declining faster.


PS. Pure, when you quote me, please do not insert phrases that I would never use, that in fact violate one of the precepts I have consistently advocated here, which is the presumption of good will. You will never see me using a term like "evil leftists," because I presume that those making argements I disagree with are motivated not by malice but by the same good will toward all humans that motivates me.

 

[R. Richard]

Too late - they've already turned your pension over to the government. It takes 12.4 percent of your earnings below $90k, spends it now, and promises to pay you a "pension" that compares very poorly with the historical returns available from prudent, diversified privately invested savings. Unlike a 401K yu don't own anything you can bequeath under this system, and unless you live a good long time after retirement your return may actually be negative. (I have read that becaue of lower life expectancy rates the aggreagate return from Social Security to African Americans is negative - they are subsidizing the rest of the system.)

Oh, and finally, the benefits the politicians have promised vastly exceed the revenue the system can expect to take in, making the whole thing a ponzi scheme.

That is what the government run pension system looks like.

Social Secuirty is the subject of a heated political debate that has been poisoned by rank partisanship. I have noticed that while AH is solidly liberal in general, it is not necessarily statist. Social Security in its current form is a system only a devout statist could love. Should a discussion arise about it in this thread or elsewere, I hope the rank partisanship that has poisoned the broader political debate can be left out if it.

You raise interesting points. However, there is a solution. Google up texas retirement plans. In the 1980s [1983 IIRC] the federal giovernment let certain state governmentlike activities [citeis, school districts] opt out of Social Security and establish their own retiremant programs. Said retirement programs have now begin paying out to the first wave of retirees. The payments are some 2.5 to 3 times more than SS. SS gives participants a $255 death benefit, the Texas plans furnish a $50,000 life insurance policy. Finally, the money in Texas plans belongs to the retiree, the SS plan belongs to the government.

 

[R. Richard]

rr they will first have to pry my cold, dead fingers off of the stock of my 10 gauge and/or my .475 Wildey.

P: the only language liberals, collectivists, and 'statists' understand is hot lead.

Well, perhaps my approach is not correct. It might be that you could get an answer to my question, from the US government. I have been unable to get any sort of response.

My question is: "Why did the US government spend all of the Social Security money collected by the system and replace the money with worthless SS bonds?"

TIA!

 

[Roxanne Appleby]

You raise interesting points. However, there is a solution. Google up texas retirement plans. In the 1980s [1983 IIRC] the federal giovernment let certain state governmentlike activities [citeis, school districts] opt out of Social Security and establish their own retiremant programs. Said retirement programs have now begin paying out to the first wave of retirees. The payments are some 2.5 to 3 times more than SS. SS gives participants a $255 death benefit, the Texas plans furnish a $50,000 life insurance policy. Finally, the money in Texas plans belongs to the retiree, the SS plan belongs to the government.

Indeed, there are many potential solutions. Denying the problem and/or demonizing those who offer solutions - both of which are SOP in the broader political debate on th issue - are not among them.

 

[Pure]

rr,

Well, public spending is authorized by Congress. Such a shift was surely voted on, so i suggest you ask those who voted for whatever specific measure you're referring to.

Are you implying there was a kind of theft? Where was the money before it went into these 'bonds.'


rr: My question is: "Why did the US government spend all of the Social Security money collected by the system and replace the money with worthless SS bonds?"

 

[Pure]

Rox what is going on in this thread is generally just spitting on a system that has created a previously unimaginable standard of living for the vast majority of Americans.

P: sure sounds like a presumption of 'good will' and humanitarian motivation to me!

correct me if i'm wrong, but surely those who 'spit' on something very good, are evil.?? or do you prefer to call your colleagues 'utterly deluded'?

 

[Liar]

First off, good for western Europe that they too have high homeower rates.

As I said, I just scanned the thread. Pasted below a sampling from the first page. There is a health dose of bashing, and more posts seeking to undermine what truly is a good news story.

"There are more people poor and starving in your country than, well - any supposed 1st world county. How terrific is that?"

". . . your 'triumphs' may come off as a bit biased when you trumpet every small success that's happened while the Republicans have been in power . . ."

". . . home ownership includes condos . . . Really, it's the banks that own those homes. Americans just rent them...unless they can manage to pay off a 15-30 year loan, which, alas, many can't." (I like that "many" - cute.)

". . . you aspire to the American Dream (facade really) . . ."

"This pretty little 70% doesn't make the real dirt and grit of America."

"That home ownership figure includes owners of dinky condos and trailers. I also doubt if that many people actually own securities. They probably include those persons who have 401 accounts or other retirement accounts. . . . individual account holders have little or nothing to say about what happens to the money that is invested . . ." (Yes, many people own financial instruments via retirmement accounts. So what? The last is not true - most plans offer a wide variety of investment options.)

"Let it be said, the 'home ownership" includes mobile homes . . . deaths in hurricanes etc. disproportionately affect those in mobile homes."

" . . . this article puts it all in a very real perspective: 'RECORD 75 MILLION AMERICANS NOW PRETENDING THEY OWN THEIR OWN HOMES- Low Interest Rates Help Many Fulfill The American (Banker's) Dream' "

Edited to add: Nothing personal against those who posted these.

2 attacks of the "Oh America is so much more terrific than any other country in the world" attitude of the original poster.

1 lame attempt at republican bashing.

And the rest of the quotes merely question the relevance of those statistic numbers. Numbers that was about America. So what should they say?

 

[Roxanne Appleby]

A characterization of a person's speech or ideas is not the same as a characterization of his or her motives.

If you disagree, then that means you must think those who disagree with you, including me if I disagree, are evil.