To make a fortune, target bored young men who want to make a fortune
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It started a few years ago when sports betting was legalized in my home state and when I was at a bar before Thanksgiving to see some friends, half of them were watching a basketball game involving teams they've never cared about. They showed me that they were betting some wild parlays to hit on this game they had no interest in watching otherwise. They showed me that the apps keep track of your net earnings (I assume this is a legal requirement) and _all_ of them were in the negative between $400 and $800. Keep in mind that these are young men who just graduated college and we were all pretty broke.
Flash forward, a lot of them still sports bet regularly with regular losses. I live in a different state now, but a group of my friends around here recently go into going to a casino near by. I was blown away by the justifications on their gambling habits. "I usually win" or "I only gamble what I come in with", but the latter isn't true and I've seen it with my own eyes. I met up with them (not to gamble, but to see a friend), and thirty minutes in one of them was asking the other for $40 so he could "win it all back" at the roulette table.
It blows my mind. We know so well that gambling is a losing battle. Some can have fun and call it the price of fun, but it's such a slippery slope to find yourself losing way more than you intended.
Anecdotally, I notice that the women in my life gamble less.
Anyway, they had a scene where they were showing the different games that were being played in the casino. Things like a bunch of Saudi princes playing an extremely high stakes game of Candyland, etc.
One of the games was called the black hole or something like that. Anyway, people would step up to the table and the guy working the table would just sweep up their money into a hole and tell them they lost. It had a constant stream of people walking up to the table to lose money.
It's more or less the mental model that I use for gambling.
Let me tell you a story. Fifteen years ago, a person named n4r9 made £10 at the blackjack table.
They turned around, left the casino, and never returned.
Now they're making 25 times that amount every day they step into the office.
And do you know who that person was?
IIRC Mafia! was a parody of the Godfather series, or the mobster movies of the 70s-80s in general.
I don't know anybody who gambles, on betting or crypto, and only a small number who even pick individual stocks. Some people play poker, but only for nominal sums, and it's usually presented as more of an intellectual exercise. I get the sense that if somebody said they like sports betting, it would produce a half-second awkward glitch in a conversation. I doubt anybody would moralize, but there might be an unspoken question like "[you gamble? don't you have more fulfilling things to do?]"
The simple answer here is probably that if you already have enough money then you don't need to gamble, but it's not like most people who gamble actually believe it's the path to profit, it seems like there's something else here where gambling is viewed as low-status (in my bubble).
Broadly, though sports in particular is something different bubbles care more or less about, I'd say your perspective is entirely foreign to me. My experience is that the more intelligent groups I'm around are vastly more interested in predicting things and putting money behind their predictions.
I think this is wrong. The most skilled poker player at the table has an edge and is likely to win over time. I don’t think there is a similar thing in sports betting.
My impression is that it’s a scoring system for competition with his (wealthy and successful) siblings; the dollar values are an afterthought.
Which isn't exactly wrong - if you're a retail investor who isn't using satellite footage of parking lots, picking individual stocks is closer to gambling.
Investing in the aggregate is less gambling.
With individual stocks, you are just betting on horses.
With hedging, you are betting on economic sectors (which can be as large as the whole world economic system) growing infinitely.
And regarding systems growing infinitely in limited environments, I have some bad news for you. Some would call them cancerous.
Rich people gamble. Poor people gamble. Everyone can get hooked; casinos are great at that!
Either that, or its because the race was fixed.+
I spent a couple nights in Vegas because my 13yo was interested in seeing it. I watched what was happening in the casinos, and wondered if I was missing something. I read a bit about craps, because I didn't really understand the bets people were making.
Reading gambling forums is just depressing. Many people understand it's just luck and are doing it for fun, but there are so many people who think that you can get "good" at rolling dice. People talk about winning big on a roll and then "reinvesting" their winnings at the table.
Legalized gambling is just a giant machine for separating people of all classes from whatever money they have.
You were missing the dopamine hits.
The highs and lows and 'drama' and 'excitement' of winning (and losing) is what people tend to go for. That's why it can become an addiction: wanting another hit.
* https://www.scientificamerican.com/article/how-the-brain-get...
It is fun though, the casinos especially have gotten very good at making it entertaining. Unless you have an addiction to it there's no inherent difference between spending a $50 on a night out with your friends of losing the same amount at the casino.
I dunno, people who do the former seem a lot happier the next day.
If you enjoy blackjack, or poker, or craps, regardless of winning or losing, then it's fine to gamble. If you're only having fun from the exhileration from the large winnings, then it's not "fun", but thrill seeking, just like skydivers or extreme sports. Except for those thrill seeking sports, there's often safety measures in place.
Never been back. The only gambling I do now is buying a $2 powerball ticket every time the jackpot goes above $1B. The momentary fantasy is worth the two bucks.
Unless you're so woke that you think testosterone is a social construct, yes it's still very ok
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3653580/#:~:tex....
The first one you really didn't read, did you? "In contrast to received wisdom regarding testosterone and risk, the present data provide the first robust evidence for a nonlinear association between economic preferences and levels of endogenous testosterone."
"Despite the common view that high testosterone levels lead to risky decisions across numerous domains, we found that testosterone has a quadratic relationship with economic risk preferences: Individuals with low and high levels of testosterone (within their gender) were risk and ambiguity neutral, whereas individuals with intermediate levels of testosterone were risk and ambiguity averse."
As long as you don't try to define your terms.
This what scares me the most in that trend
Nothing good comes from it. It only increases the wealth gap.
IDK about in the US, but in Canada the lotteries do fund a lot of charitable things but I wasn't able to find a good stat about the proportion. Also at the end of a day it just a waste of human potential (running the corporation and wasting human hopes on useless things instead of potentially beneficial things)
That's why this is called gambling _addiction_. If you understand the existence of other behavioral addictions, it's not so different.
sports betting, table games, etc: gambler motivated by excitement, somehow thinks they are going to win and make money. often racks up massive losses due to desire to "win it all back" as you say. this is stereotypically the "male" style of gambling addiction. like your friends.
slot machines, video poker: the psychology is very different. the heaviest slot machine players don't have any expectation that they are going to come out ahead. they play the game partly because it puts them into a soothing flow state (though in many cases it is just compulsive behavior with no good motivation). losing money overtime is understood as the cost of playing.
slot machine gambling is stereotypically associated with women. you wouldn't see this either because it's a more solitary activity (unlike table games/sports betting) but it can be very dark -- I think probably worse than the classic gambling addiction.
i think the gender distinctions are real although obviously it's not hard and fast (plenty of male slot machine players, plenty of women losing money placing bets). i think it's probably partly brain differences and partly who casinos/bookies vs. video slot companies choose to market to.
I like in NYC, so achieving the typical cost of drinks is not hard.
It's interesting the types of people who can walk into a casino like you and I and say OK, $20, that's all I'm spending. We lose that and we say good night. Other people… They say no, I can win this, and so they go and spend another $20.
That decision point - to continue or withdraw - is utterly fascinating.
By the time I’d slowly bled away my $20 and gave up, she was still there.
People who can't stop are possible gambling addicts already, or, are about to become ones without even noticing by themselves.
And further, I classify myself to: I wouldn't even go to a casino except it's the money I found right before it's entrance I want to spend there.
And that actually minimize the possibility that I'll ever will make the experience how it is to feel lucky/lose/win in a series, minimizing my understanding of such a situation. And that's may be is the point we don't understand how it is, not to be able to leave after 20 bucks are lost, but rather try to get it back. Just a thought.
(I compare it to an alcoholic. One alcohol addict, because too often & too much & too good feelings. One occasional drinker will never go over the threshold. One who never drinks can't even understand how it is to want to get drunk.)
This seems like funny logic.
My local provincial lottery can range from $5 to $50 million. If I were to accept that I could possibly win, anything in that range is a ridiculous sum of money for me - easily more than I am likely to make for the remainder of my career.
I know I won't win if I play, but if I thought I might I can't figure out why $5M is gambling, but $50M would be an investment. Either way, it's absolutely life changing "quit my job tomorrow" money.
And the house edge at a casino isn’t THAT bad. Eg if you’re playing blackjack at $20/hand, a house edge of 1% means you can play 500 hands for your $100.
Now they cut back on that, I park elsewhere and they don’t even get a chance at my $20 on red anymore.
Edit, my school is the top link when I searched for a reference, I guess they included it after the casinos went into Atlantic City. Generalized Gambler's Ruin Problem - Rutgers Math https://sites.math.rutgers.edu/~zeilberg/EM20/GamblersRuin.p...
vs.
A lifelong proclivity to quantize, metrify, and reduce all social interactions to transactional objects that exist soley to be leveraged.
The latter also happens to drug addicts, but the it is a psychological phenomenon that can be stymied with medication.
Unfortunately, no analogous chemical exists (yet!) for the similarly inflected urge to gamble.
I don’t really get skiing, it’s a very expensive and dangerous activity to me, yet to others it’s a whole lifestyle. Fine by me, put knives on your feet and fall down a hill. Life is short, find your dumb thrills, it’s fine.
You don’t need to gamble yourself, that’s not the point, just maybe understand that you’re talking shit about “friends” behind their backs? Kind of a dick move where I am from.
> Losing a few hundred dollars every now and then is fine
Agreed. I think everyone has that freedom to do so. I'm just commenting on the gambling trend I see in my peer group. That said, a few hundred dollars means different things to different people, and without diving in, these friends should not be losing a few hundred dollars every month.
> just maybe understand that you’re talking shit about “friends” behind their backs? Kind of a dick move where I am from.
I feel like there's some hostility in this comment. I'm sharing an anecdote anonymously on an online forum in a relevant thread. I don't have these conversations with our mutuals.
however, if we ever came up with such an indicator the gambling companies would be quick to campbells-law it to death so people would ignore it
Explain to them that they not have just lost an avarage $600 of their live-time earnings, but over $70,000, if they had invested the money in the stock market for retirement. If we assume that the avarage S&P 500 return with dividends reinvested is somewhat above 10%, as it was in the past, investing $600 now would yield them over $70,000 for their retirement in 50 years. The real value must be adjusted somewhat due to taxes and inflation. But in addition, investing in the stock market provides one with some sort of an inflation insurance for free.
[1] https://www.forbes.com/advisor/investing/average-stock-marke...
Lots of my women friends do various scratch and win tickets and joke around that winning is the only way they're going to be able to retire.
At the core of it both groups clearly feel that the economy is so broken that it's no longer to achieve the outcomes they want through normal means and only some short cut of luck will get them there.
I see this among a fair number of engineers in their 30s, 40s, and one pushing 50. I don't think many of the older crowd are doing it, but maybe they just don't talk about it. I have no idea how well they do, but I'm sure they lose on average. Bets are often in the hundreds of dollars if I'm hearing them correctly.
And at the same time, I find conversations about money with younger generations to be very hostile (btw, I still consider myself young). Accusations, assumptions, and name-calling start circulating quickly if you dare to ask 'the youth of reddit' as it were, if they understand compound interest, how much money they spend on food delivery, vapes, weed, and booze.
And then there's this pervasive social media messaging that it doesn't matter. Well, if you doom-scroll and ... don't believe? in compound interest, then I guess that is a hard narrative to escape.
> I spend my "political advocacy" bucks on trying to convince older generations around me just how much they and their peers pulled the ladder up behind them.
Yes. And this takes many forms, whether that's hanging on to property long past you need it, staying in jobs past retirement, or falsely believing the current economic climate is at all like what it was 30 years ago.
> I find conversations about money with younger generations to be very hostile
I can understand how if you grew up around the tech boom years of the 2010s you can believe that a bit of smart gambling is all it takes to generate wealth. In some sense this article is entirely relatable: I once believed if I worked for the right company I could make enough money on my own to buy myself out of the system entirely. This is a conscientious person's version of the gambling fallacy that the article discusses.
Really, any sufficiently simple path to wealth that doesn't involve the capital class gets patched out by the system relatively quickly (see Wall St's furor over FAANG engineer salaries).
Keep in mind that the main reason for today's seniors to continue working after age 65 is because the ladder was already being pulled up when their fathers and grandfathers were in their teens & 20's, by the same forces that are still acting today.
If you do the math you would have to figure that the majority of people working to reduce opportunities for today's young people, are not senior citizens but mainly just a different class of younger people closer in age to their 20's than their 60's.
>Really, any sufficiently simple path to wealth that doesn't involve the capital class gets patched out by the system relatively quickly
So true, but sometimes quicker than others.
It's more like a zero-sum outcome for seekers of a simple path to riches before a certain age, of which there is never going to be enough opportunity to satisfy.
You can't buy yourself out of a financial system by working for money.
You don't stand a chance unless you work for something else more worthwhile.
And why would you want to retire from that?
You can always find something to do with property to generate income. Once that property is gone, you'll probably never be able to buy it back for what you sold it for
And no I don't mean the JShit we have today. That you need an army of people to keep a gui running is the victory of Wall St over the hackers.
You don't get to be upset that someone keeps their property for longer than you deem they need it, or telling people they should stop working to do nothing for their last 20 - 30 years of their life.
The boring reality is that small things done consistently over time seriously add up. It's true for health and exercise. It's true for relationships. It's true for finances. A $5 pick-me-up every now and then isn't a bad thing by itself. But if it becomes a daily habit, then you're missing out on other choices with better long-run returns. The immediate costs are small, but the eventual opportunity costs are huge.
Younger people have a resource older people don't: time. That's time for habits to compound. May as well choose good ones to compound, because you're never getting that time back again.
I'll take your $16/wk for vaping costs, I don't have any hard data but I think that's probably a bit low.
$5 for coffee 5 times a week, that's $25/wk.
Looking around me, its hard to get a meal delivered with a food delivery service for less than $18. Making a meal at home, even a frozen pre-cooked dinner, is usually like $5 or less, so we'll say an additional $13 meal 4x a week so $52/wk.
52 + 25 + 16 * 4 weeks in a month is $372/mo. Over $4,400/yr, on just eating out/delivery, one coffee 5 times a week, and vaping. And somehow I doubt its really just 5 coffees a week, its probably not just $13 additional cost per meal only 4 times a week, I doubt a vaping habit is really only $16/wk.
Is an extra $4,400/yr in their budget a big deal to the people in question?
people are eating out more than ever before, getting delivery more than ever before, and vacations are also booming. consumption is up no matter how you slice it.
i think a lot of the younger generation have completely given up on the idea that they are ever going to own a house and instead of saving for that are just blowing it on food, booze, vacations etc.
£50k is now a deposit.
Compounding gains in investments still work out in the long run, but an older generation trying to tell the younger one about putting money in a savings account and letting it earn compound interest has been out of touch for a couple of decades now.
Compounding applies to stock returns as well, which have been on a tear for the past decade. If anything not knowing what to do with your money besides parking it in a bank account is a sign of financial illiteracy, which is what OP was decrying.
i have not heard a single older person saying this. Every one of them says to invest in assets, not bank interest.
I’m not young, and if you tried to start a “conversation about money” with me in this fashion it would go poorly. Perhaps you just aren’t giving a clear picture of these attempted conversations, but you come across as rather condescending in your own post.
At the same time, I see a pretty pervasive attitude among young people that boils down to "if I don't do well, it's society's fault". It's like this overwhelming victim mentality, like a sense of learned helplessness that affects areas of their life even where they are not helpless. Not only is this a bad attitude for society, it also becomes ultimately unhelpful for the individual as well.
Obviously I see where a lot of this attitude comes from (see the first paragraph), and yes, I'm speaking in very broad generalizations that don't apply to everyone. But it just feels like this big shift where a lot of people feel the only path to success is, essentially, luck or some sort of scheme.
The one that is mind-blowing to me is giving money to streamers. Utterly, utterly wasted money.
It's just an entertainment budget item. If the generation isn't spending that money on traditional forms of entertainment--concerts, cable, movies, sports games--then how is it wasting to spend it on the form of entertainment you don't like?
Maybe doom scrolling is addictive to this level too. But the point is, we, and especially young people, are being targeted for addictive substances in a way that Joe Camel could only dream of, and yes, addiction is hard to escape.
But now they took the ball away, and everything is getting suddenly really expensive just as they are moving into independence and need money for housing, marriage, maybe even kids. But the habits of having life greased by all these services is hard to walk away from… how many GenX would give up having a washing machine and microwave?
Vaping and weed, well they are literally addictive and a scourge all around…
This generation war thing seems strange. Like, do you accuse the people of wrong things they did personally? Or do you make them responsible for other people's decisions? What's exactly the point? Instill a feel of collective guilt?
Seems like setting ourselves up for the same kind of harsh critique from the coming generations. I doubt they will look upon us (the current young people) kindly, and "boomers did it" likely won't work as an explanation for why we still indulge ourselves in material luxury, airline travel etc.
As for the second paragraph, I guess I'll just say, I think you're probably completely spot on.
They voted for policies that pulled the ladder up behind them, are they not responsible of their vote?
There's a lot of pointless/ultimately destructive ways to make money. Precious few to get dpne what needs to get done. And I wholeheartedly believe much of society has forgotten that "what is profittable" != "What needs to be done".
I'd like to consider myself pretty financially literate and I have no idea what this is supposed to mean.
This seems a _little_ alarmist, no? Assuming you're in a major developed economy, inflation is falling. It's still too high, but 'ever increasing pace' is simply incorrect.
And while this high inflation is kinda shocking in modern terms, it's not actually that_ unusual historically. The current US inflation rate is lower than it was for the _entire period_, bar one year in the 80s, between 1971 and 1992, for instance.
The housing thing is much more of a legitimate point, but people are over stressing the inflation thing.
It is really important that people understand that inflation isn't "falling" in the sense that things are getting cheaper
A lower inflation rate just means that stuff is getting more expensive more slowly, but it is still getting more expensive
Unless we see actual negative inflation, the damage of high inflation rates has already basically been done. Salaries have not kept up and will likely just continue to fall further behind
"Inflation falling" does not mean "things are getting cheaper" in exactly the same way that "driving backwards" does not mean "reducing speed".
Where did this meme even come from, that this is confusing? Did they stop teaching what the definition of the word "inflation" is? Or did they stop teaching about the relationship between measuring values over time and measuring rates of change in those values?
Inflation isn't a confusing concept! Are people really confused by it, or is there just a lot of noise about this?
> Unless we see actual negative inflation, the damage of high inflation rates has already basically been done.
"Negative inflation" is called deflation. That's what happens during a depression. Deflation would be a very bad thing, you do not want deflation.
> Salaries have not kept up and will likely just continue to fall further behind
This one is just simply not supported by economic data. If you're just talking about the tech industry, then, yeah, maybe. But it's not true of the workforce as a whole.
I think a good lesson to learn from this period is "people are very sensitive to gas prices and the rates on mortgages and car loans".
I make about 2 times the median income in my area, that puts me in the top 5% nationally. I can 'afford' the bottom 10-15% of housing. It's already a shitty proposition for me with 16 years experience and career progress. I can't blame young people for saying fuck this shit.
But at least I can afford food. So there is that.
Either way, it has never been the case that the average person is able to afford to live in the city and raise a family. why do you think that everyone moves out to the suburbs to buy a house.
The town your parents moved to was not as built up when they moved there as it is now. The city expanded. We just have to accept that we'll probably have to move a lot farther out from the city which is really the same equivalent that your parents did.
the nation is not completely homogeneous. In the situation where you are looking to purchase housing, the only comparison is in the immediate region (such as the county or at most, the state), as only others in the region competes with you, not somebody in a faraway state whose wages are much lower.
What percentile are you in your area?
And yeah, housing is screwed, but no that does not mean "the economy" is fucked.
If the central banks can keep from going down to near zero interest rates of course.
And I agree with you that younger generations, probably at large due to social media, are not patient enough to get rich by saving.
Speaking as someone in a younger generation, there's a sense that with the climate sword of Damocles dangling overhead and countless people stressing the already fraying hair, perhaps we may not have sufficient time to accumulate any sort of wealth by saving. Perhaps this is just a lack of patience in our generation, but I think it's quite possible there are bigger factors at play.
Think of it like nuclear weapons. You can't really plan for nuclear war, but you can still take nuclear capability into account when making financial decisions (e.g. China is unlikely to annex Taiwan because of US nukes so investing in TSMC is not a terrible move).
That sounds like you've got some extra money laying around that should belong to your landlord...
In any case, there is no reason people cannot put some money aside each month and earn some interest every year. And on top of that the house prices will not increase, at least not insanely as in the past, so you have a chance to catch up if increasing your salary and savings for a few years.
A lot of people live paycheck to paycheck, especially younger people. How are they supposed to take advantage of this, exactly?
I was born in abject poverty. I went to public school and state colleges. I made money in TN, GA, AL, and TX before settling in northern CA. This area is my dream location and it took nearly 2 decades of planning and effort out of college to prepare to buy and settle here in a financially stable way.
San Fransisco isn't the only city available to US citizens. If you can't save in a high COL location, move to a lower COL location so you can save. Then, when you've saved enough, move back to a higher COL area.
This idea that you're stuck in some expensive geography and can't do anything about it is plain silly. I made most of my moves with less than $1,000 in the bank and plenty of credit card debt. After moving a dozen times across nearly half a dozen states, today I own a home in the Bay Area outright, have zero debt, and do what I like with my time and I'm not yet 50.
If I would have left college for the Bay Area immediately, none of that could have happened. It took planning and stages and moving all around the country (and living in the cheap South) but it was doable and is doable now for anyone that wants to make the effort. Yeah, boomers had it a lot easier, but so what. That's history. That was what they got for living in a high tax high investment era and we get what 20 years of Reagan and Clinton gave us, trickle down, so we deal with it.
"I want to live in SF or NYC out of college and own a home because boomers could do that" is bullshit. There's a substantial generation between you and boomers, my generation, X, that saw we weren't gonna have it as easy as the boomers and we didn't complain, we changed tactics and adapted to the environment. We figured out by going to state schools, busting our humps at a half a dozen different jobs including ones with serious physical labor that might even cost you a finger, being illing to live in less than ideal places for years or even decades, could let us settle into something better in middle age.
California costs about 2.5 months more salary to live in than the national average and about 4 months of salary more than truly affordable states. If you can increase your savings by 2.5-4 months of take home all for the price of a bus ticket and a few days of hotel stay to find a place to rent in a more appropriate COL location, you can save for a house, even a house in a high COL location, no problem. You probably cannot save for a high COL location house living in a top 3 COL state while trying to do so.
I'd estimate that a single individual with zero skills in NYC could get:
1) A receptionist job for $46k/yr (includes health insurance) [1]
2) A shared $2k/mo 2BR Jersey City apartment [2]
They'd have a take-home pay of $2960 - $1000/mo (rent) - $1000/mo in other expenses (fairly high estimate IMO).
Annual savings (with a traditional IRA) would be about $13k/yr.
It's not much, but the savings rate is almost 30% of gross income, and retirement calculators say you'll retire at 65 a multimillionaire. Surprisingly, a daily Starbucks or avocado toast (or forgetting the tax-deductible IRA contribution) really does eat into the savings numbers. And forget about having kids until you get a career upgrade.
The major risk is an increase in rent without an increase in wages. Let's investigate:
From 2012-2024, rent in Queens (not sure about JC) rose 45% ('only' 3.14% APY) [3]. Over the same period, national wages grew 47% (3.3% APY) [4]. That's good, since our individual earns 3x more wages than they pay rent. Wage growth was even higher among nonmanagers, so I don't think the growth was captured by the 1%. [5]
Overall, it looks OK to me, though the margins are thin, and you need to share an apartment. Hard to make it work for a family. I'd be curious to see some others run the numbers.
[1] https://www.indeed.com/jobs?q=receptionist+-hour+-experience...
[2] https://streeteasy.com/building/3657-kennedy-boulevard-jerse...
[3] StreetEasy Rent Index: https://streeteasy.com/blog/data-dashboard , chose Queens as it was most comparable in price to JC
I'm going to use that. Great summary.
Why is it a foregone conclusion that these things are only occurring in one direction? What evidence is there to support that (or not)?
It all comes down to biology. The dopamine hit you get when your 0DTE you bought for pennies per option skyrockets the next day for a 1,000% return. It’s a dopamine hit unlike anything before it. Forget heroin, methamphetamine, cocaine.
That hit of dopamine from just 1 successful “trade”/gamble is enough to wipe out the previous 100 failed trades. Some people in the drug addiction trade would call this “chasing the high”. Same thing for casinos.
Same reason why your grandparents might spend hours pulling the lever of a penny or nickel slot.
Also probably why insurance companies tend to rate new drivers, especially young men, as “risky”
It's easy for me to sit here with righteous indignation, acting like I'm super smart for not blowing my money on gambling, and for a long time I did just that, but recently I've kind of realized that my cowardice towards losing money is also why I'll never be wealthy.
I gravitate towards decent-but-not-amazing-paying W2 jobs. I like them fine, I'm comfortable enough, and that's the safe, nearly-zero-risk path. It's certainly not a bad life or anything, but you also do kind of top-out fairly early. By age 27, I was a senior engineer at Apple. I didn't really have any intention of becoming a manager, so I was only like two promotions away from seemingly maxing out my career. I absolutely hated my job, and it depressed me because it felt like this was the end goal, and I was miserable; there was no more substantial path "upwards", and the top was just not a place I was happy.
If I weren't such a coward, and had a higher tolerance for risk, I almost certainly would have started a real business. Starting a business is basically a fancy gamble; most businesses don't succeed. It's kind of hard for me to condemn gamblers at that point.
You have a lot more impact as a founder over whether that business succeeds than you would ever have over a wager in roulette or a 4 game NFL parlay on Sunday.
Both are risks. Only one is a gamble.
I do think that there's a bit of overlap in that part of the mentality of people who gamble and people who start businesses. You have to accept that there's a good chunk of luck with starting a business, and also acknowledge that if you don't have that luck that the business will likely go belly-up.
What I was getting at is I am personally a coward. I don't say this with pride, and this isn't some attempt at humble-bragging or anything, it's a dig at myself, not entrepreneurs.
Sometimes being a coward isn't a bad thing, if nothing else I don't waste my money at casinos, so that's good. But because I'm so terrified of losing money, and so terrified of anything involving "risk", I feel like I took the cowards way out by working for BigCos at a desk job instead of trying to build my own thing. Sometimes I'm a little jealous of the people who can throw caution to the wind.
Anecdata, but me and all of my friends started to pretty aggressively save money at around age 25. It’s probably not coincidental that that’s also when we all started to get reasonably high paying jobs.
#3 - A friend who recently (within the last year) drained his savings to $0 paying for a trip to Europe. All of the money came from day trading stocks on Robinhood.
#4 - A friend who bought a house just over a year ago. The house cost a few hundred thousand, and he decided to put a >50% down payment on it, which he did by liquidating some (not anywhere close to all) of the money he has in index funds.
Those are probably the two most extreme examples, and I could provide more examples that are anywhere in between. I'm going to wait for a study that does some statistical analysis over the population before I draw any conclusions.
If there is one piece of advice you take, save early, save consistently, put your savings in index funds (I target my portfolio at 50% VTI, 25% VEA, and 25% VCSH).
Simplicity trumps optimality. And VTI is close to optimal for most people, even (perhaps especially) people who think they can do better than it.
Also the biggest companies are most often the least societal beneficial ones, so it's morally more difficult for me to justify investing at a stock exchange.
There are various funds which include or exclude companies based on various criteria, whether generic ESG ones or more specific ones.
Yeah, this is a hard one. There a handful of funds out there that invest in less damaging companies, obviously with a somewhat smaller return. I ended up choosing PAXWX, for example, though there are others. I'd be happy to hear others' ideas for ethical investing (preferably without a lot of effort).
In this case, boring is the entire point, but it's hard to sell the average 20-something something boring that they won't get to use until 30+ years from now.
I know plenty of old-school companies that treat their people remarkably well and loyalty goes both ways. But I struggle to think of a new-schools tech company that won't exploit an employee's naivety.
20 years ago your dating pool was far more limited to location and social circles you were in. Online dating has decimated that. The illusion that you are a big win away from achieving a fast track to status is the allure.
Hmm...
However, you do see a lot of gambling shops around, and we get news stories of it being a huge problem.
I think if you're not based in the UK it would seem like it's a much bigger deal than it really is to many of the population. It's a big deal to a (small?) subset of the population.
In mainstream culture, it appears that Generation Z consumes less alcohol compared to earlier generations (although they might be substituting it with other intoxicants).
More niche but still present are the peculiar trends associated with right-wing groups, 'nofap' and similar movements.
If you're referring specifically to a movement involving spending money, I agree and anticipate that emerging as well, probably merging with one of the above two.
* https://kyla.substack.com/p/gen-z-and-financial-nihilism
A lot of people don't see a bright (financial) future for themselves, and that working hard won't get them anything meaningful. So long shots are perceived the only way that you can improve your lot in life, as otherwise The System™ is stacked against you (student loans, housing costs, etc).
Which isn't to say it's not an issue--both are. But despair driving people to spend increasingly on short-term endorphin hits is universal. The most meaningful metric would be the proportion of income that's saved and invested.
Is burning $100 in a fire really any worse than spending $500 on a real, usable item?
Probably. A bag is an item with utility that can be resold. Typically the person buying the handbag also gets entertainment value out of the time spent shopping for the handbag and also enjoys using the handbag for some period of time.
Sports betting is pure entertainment. I don't know how far $100 goes in sports betting. If that's what you spend in a night, I'd say the handbag is easily a better value for a person who likes handbags. If $100 is what you'd lose in the aggregate over a month, with several hours a day spent enjoying sports betting, maybe the sports betting is the better value. I guess it depends on how good of a gambler you are.
For both, I say if you can afford it and it gives you enjoyment, go for it: that's the reason to have money. If you can't, don't do either.
Despair is certainly an issue.
Yes, simply because the risk of addiction is higher with sport betting than handbags.
You could easily rephrase this as "It's just entertainment. Is blowing $100 on heroin really any worse than $500 on a designer handbag?" to illustrate the absurd case where this is obviously true.
No it is not. If it was, people wouldn't have those sad face and wouldn't look like zombies when gambling.
You can argue anything with made up numbers.
Is more money in the US spent on gambling, or on prestige goods?
https://www.nytimes.com/1997/12/19/us/cia-says-it-has-found-...
A bit of that attitude leached off on me as well, but I have noticed that it is almost completely vanished from American culture.
Gambling used to be something that whole swaths of society looked upon with absolute contempt as nothing but an unmitigated vice.
"To make a fortune, coach young men to their benefit" -- Good market economy stuff
"To make a fortune, exploit the depression/negativity of young men to your benefit" -- What this article is actually about.
I'm often seen as the more successful and stable member of friend groups. The number of people that come to me talking about their puts, calls, crypto, and other high risk investment play is way to high. I always tell them "I invest long, so I don't know anything about that" and try to steer them towards more predictable investment options. No matter how many people I point to real estate deals they could feasibly get into, and talk about how much I've made on real estate, not one of these people have gone down that route. In the way they talk, they actually want to gamble and don't want to grow wealth. I think it might also be the marshmallow experiment, because they also don't want to discuss any play that I measure in years.
I'm seeing this in more demographics than just young male. I was looking into a business plan and talking to a trusted boomer about the business plan. They have more experience in some specific aspects, and I was looking to identify more risks. Towards the end of the conversation they told me "of course, I was never a gambler", to which I replay "neither am I, that's why I'm talking to you and doing my homework."
The only RE investing that still works is buy, rent, have retirement equity in 30 years, maybe. Occasionally put some money IN. Potentially lose a lot of money mid term and hold paper losses if RE bubble pops. And guess what? Maybe not even that with the current rates.
It's funny to see people acting like RE is some bastion of stability. Stock market is inflated atm too.
Yes. What other way could you possibly reliably generate positive cash flow with real estate as a normal person without a lot(!) of initial equity?
Common advice where I'm from is buy tiny apartments without rent cap in good locations (Stuttgart, Vienna, etc.) on maximum loan runtime to refinance later and rent them out. Preferably one every 1-2 years. These typically cost anywhere around € 120-150k and the common 20% deposit can be earned reasonably quickly. Banks will usually be completely fine with this as long as you have positive cash flow and you can write off a lot of things around your business as a renter on your income tax forms in most countries.
I have only ever heard variations of this advice. Never anything else.
What happened?
https://en.wikipedia.org/wiki/Murphy_v._National_Collegiate_...
Folks who don't want to fund their state from the loss and despair of other people, for one.
Faith in this system is dwindling, and whatever your political inclinations, that is dangerous. Fewer people believe that putting in a solid eight hours of honest labor is going to assure a decent lifestyle. Gambling is one potential path out, maybe not even that irrational if you perceive it’s your only shot.
If there's some combo of a floor effect (if they don't have much now, they don't have much to lose) and pessimism about the future (they think this is the only way they can manage to get ahead), I can see people deciding that gambling is worth it.
But I assume you know that so you must be asking, "Is there a situation where somebody can accurately understand the expected outcomes of any particular bet where the odds are against them winning and still come to the conclusion that taking the bet is rational?"
And one answer comes immediately to mind although I'm sure there are several: when I'm willing to lose for the entertainment value of having the chance to win and knowing that short term variance means I may in fact win.
(Speaking in population-level averages here. The "elder millenials" that came of age into the financial crisis are now own homes and have families to a large extent, though of course many individuals still can't afford homes or families.)
I despise that this has only gotten worse for today's young people (after getting better for awhile, I think). But even still, working and saving continues to have much higher "expected value" than gambling.
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It's a blatant signal that your society is stalling and cannot produce actual value.
I don't think the 9-5 job is going to survive another generation.
I don’t really see though how increased financial risk among certain people would kill the 9-5, though.
The future belongs to those who believe there will be one, and who act constructively. Or, negatively, those who believe there won't be a future often act in ways that sabotage any possibility that there could be one.
This sounds very nice, poetic even.
Too bad you can't believe your way into a house when working at a near minimum wage job with tens of thousands of dollars of student debt and being one health crisis away from living on the streets. How does one work constructively out of that? Take on more debt to get more education? Apply for the 700th job this year, and hope it's the one? Move away from your support structure to somewhere "affordable" (where?) and hope you land a job there?
Statements like yours tend to ruffle my feathers. I can't help but picture someone who already has a comfortable life looking at the people who don't, saying "I'm fine, you should be too. Just believe in yourself and work". That is not how you intended it, I'm sure. But that's how it reads to many of the people who are struggling.
Bootstraps?
But you can make that argument about anything, I guess, and if you make that argument I don't think it's even possible to think of yourself as blowing money, no matter what.
Looks like the HN post title has now been updated to that subheading.
This article nails down some things about this phenomenon - at least concretely identifying the demographics - but it doesn't really give any satisfying answers or propose any solutions.
We've made it so easy for people with addictive personalities to click "gamble" that it's unsurprising to see it on the rise. With stuff like crypto we've normalized - even glamorized - the behaviors. Gambling is "useless" in an economic sense - it doesn't create any real value, it only provides "entertainment."
The problem is that not every gambler is going to be entertained, especially if they light a bunch of money on fire and suffer real negative economic consequences. It seems like we should be doing something to mitigate this...
Even investing meme stocks is better then gambling, because it's a positive sum game.
Business Insider is such clickbait trash these days.
I've helped a ton of my friends stop living paycheck to paycheck (even adults in their 50s); my journey to this was not easy, and I really just needed a mentor.
The difference between a young 20s and the older generations is thirst. The older generations have experienced drought and hardship in a way that Gen-Z might not ever experience, leading to a seemingly entitled response to everything.
Another commenter said Boomers, Silents, Gen-X, Millennials, etc, "rolled up the ladder behind them" and I think that's accurate; I'm bit a tired of trying to help and being met with insult... so someone I've 'rolled up the ladder', in a way by not offering as much advice.
>The difference between a young 20s and the older generations is thirst.
If your version of "helping" is telling them that they're fine, other generations had it harder, and that they lack 'thirst'... No wonder they respond negatively.