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Comment by qeternity | Hacker News Reader

> It's L1 season

You say this as if it’s a valid thesis outside of CT. Solana has exploded because Alameda, Cumberland and related VCs have made it so.

> Young people are locked out of any and all assets. They can't afford real estate or any meaningful amount of stock. Savings accounts have a negative yield.

Casually ignores Robinhood and equity markets, where most of any under 50s should have most of their wealth. Fixed income is a much bigger problem for old people than young people. Real estate, I will agree with you. But none of this justifies crypto.

The rest of your comment is truly bizarre. You’re defending it pretty strongly while also seemingly admitting that there’s little real economic value being created and that will result in a crash with people getting wiped out and starting over.

Why accept this? Why not focus on the real issues, instead of just accepting degen apeing with open arms?

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I think their point is that crypto is an interactive lottery ticket. If you have $5 to spare, you can't turn it into $10 000 with Robin Hood in a year, but you might with crypto.

I really don’t get why people say this. The only periods of time when it has been true, when coins are doing 1,000x are during massive Tether fueled bubbles (2017 and 2021). If you believe the writing is on the wall for Tether, then this is not a +ev strategy.

Well, the problem is...they have no wealth. They may have low paying jobs or even two jobs. Or a reasonable job yet high debts or living expenses. Barely getting by, with no prospect of ever building up more meaningful wealth.

It's super cool that their 5K turns into 6K in 10 years time, but that doesn't do anything. You might as well turn it into 100K. Or lose it all. Fuck it.

I don't think you understand the dire situation of younger generations. In my country, the AVERAGE home costs 485K USD.

The median salary is 36K. Young people have salaries lower than that. This allows for a mortgage of 166K.

So unless you're born rich, you won't ever get a house. Perhaps they can rent then, and meanwhile save up? No. Private rent eats up so much of their salary that there's no room to save. Which would be pointless anyway as real estate appreciates faster.

They can't move out, they can't start a family. These people have a life to live. My dad was 19 when he had a rental house, married, two kids, and 50% of disposable income on a job requiring no education. Now people are 35 and still don't have the basics in place.

Hence, crypto. Which is not just a bet. It's an expression of full distrust against the supposed "sane" traditional system.

Why not focus on the real issues? Because they are unsolvable. Wages cannot rise significantly as nations compete in global capitalism. Real estate won't become much cheaper. Jobs security will not increase and student debt is unlikely to be forgiven.

If a young person working full time cannot afford a roof over their head or start a family, is in perpetual debt, and has zero job security, perhaps some start to wonder what the point of it all is.

> It's super cool that their 5K turns into 6K in 10 years time

Ok, I get it. You’ve not actually looked at what other investments are like. 20% return over 10 years? The S&P 500 is on track to do that this year, after one of the biggest rallies in history last year. $5k invested just before the covid collapse would still be worth far more than $6k, and that’s 18 months through a global pandemic.

That said, your answered your own issue: homes are unaffordable. I’m with you on that: we turned housing into retirement plans for boomers. And now we don’t know what to do about it.

There’s an old adage in commodities trading: the best cure for high prices is high prices. The meaning behind this is that when prices are too high and people can’t or won’t buy, then prices can only go down. Over the next few decades, young people will either earn substantially more, or housing will become substantially cheaper.

You can’t sell anyone a home for $485k if they can only get a $166k mortgage. So these things will converge.

As much as I enjoy pissing on boomers, older home owners did nothing for their houses to appreciate. It's just something that happens due to monetary policy, low interest rates, local scarcity of supply and a growing population.

A lesser known reason is that since the 2008 crisis, hardly any new homes got built. Whilst the underlying demand was still in place, and growing.

"You can’t sell anyone a home for $485k if they can only get a $166k mortgage"

You only need enough buyers that can afford a 485K mortgage to meet supply. So when supply is very low (which in my country is very much true), if only 25% of the potential buyers can afford that mortgage it's still enough to buy the supply. Which they do, and they even overbid still.

So this can keep going for a long while. Not even a crash solves it. Our 2008 crash dropped prices by 20% only. Which is now the gain in a single year.

So that leaves the only other option you mention: wages.

> As much as I enjoy pissing on boomers, older home owners did nothing for their houses to appreciate. It's just something that happens due to monetary policy, low interest rates, local scarcity of supply and a growing population.

All the things you mention, boomers did that. Monetary policy was drafted by boomers, for boomers, to protect and enrich boomers (low interest rates being one outcome). We printed trillions last year to protect boomers at the expense of young people. Scarcity is a function of zoning laws, again drafted by boomers to protect the value of their nest egg. It’s 100% their fault.

>enrich boomers (low interest rates being one outcome)

Why does it matter if you pay $1000 per month on interest or $1000 per month on the principal? The monthly payment is the same. The only difference is that the bank takes less of your money.

Boomers absolutely constrained supply to raise prices.

Your problem is not with “boomers.” It’s with a population pyramid that has actually just fallen apart — but those effects won’t show up for another 20+ years.

Nope. The problem is zoning laws which are a boomer invention. The population shift may actually solve the problem as there will be enough homes to go around despite it being de facto illegal to build new ones anywhere anyone wants to live.

>population pyramid that has actually just fallen apart

True, but the effects do show up today. When people have less children, the economy also consumes less, meaning less work needs to be done leading to a scarcity of the holy "well paying full time job". Instead you get a rise in part time jobs and as wages go down you also get an increase in "meaningless" employment in the service industry.

The lack of children that are consuming more than they produce has basically created a huge demand hole in the economy that the rise of "consumerism" is trying to fill. Meanwhile working age people try to save for (early) retirement and reduce consumption themselves.

That's not a boomer thing at all, it's a human thing.

As soon as younger generations secure a home, and when they resell later, they aren't going to give discounts to the next generation. Surely you can't belief they will?

Everybody that owns a home, regardless of generation, wants their home value to at least persist and ideally grow. Likewise, people want to protect their neighborhood, as it directly affects the quality of living.

It's natural and normal behavior, and not an issue in itself. The real issue is the infinite growth mindset in a finite world.

>Wages cannot rise significantly as nations compete in global capitalism.

They can. If every country did balanced trade then there wouldn't be anything wrong with global trade. You'd get the benefits without any of the downsides. It's when countries export more than they intend to import that things are getting worse. Of course, balanced trade wouldn't allow the existence of global reserve currencies. The USD would have to give up a meaningless benefit.

"Solana has exploded because Alameda, Cumberland and related VCs have made it so."

By building things of value in the ecosystem.

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