Hacker News Reader

Comment by liber8 | Hacker News Reader

You do realize you've disproved your own point, right?

>>This is vitally important because it means it's impossible for a significant percentage of people to retire early unless the remaining workforce becomes correspondingly more productive<<

...

>>Arguably, that is already happening even without additional early retirees, simply because the increased average life expectancy (and thus the time people spend in retirement). Effectively, everyone is already doing an early retirement, compared to people 50 years ago.<<

Obviously the remaining workforce has become, and continues to become, correspondingly more productive. If you need another example of this, see 2008-2012. We lost millions of workers from employment ranks, and our GDP is currently higher than its ever been. Sure, past performance is no guaranty of future results, but I and many others believe this trend will only increase in the future. Fewer workers will be producing even more.

View on HN

I haven't disproved my main point at all (returns from investment are ultimately funded by the working population) - just perhaps not given the proper weight to the caveat about increased productivity when talking about the effects.

However, fact is that most people's incomes have stagnated or decreased. The increased productivity is not quite enough to compensate for the increasing number of retirees and/or super rich (the article linked to by hudibras implies it's actually mainly the latter).

If you look at peoples' gross paycheck income, it appears to have stagnated, but much of this is due to the rising costs of healthcare. Incomes are effectively continuing to rise, it's just that much of that increase is being funneled into benefits rather than take home pay.

Then again, it's also important to bear in mind that most common investments are made in stocks and bonds, not in workers. In this case you're investing in companies and/or government securities, not employees, so falling incomes do not necessarily imply decreased ROI.

To some extent you are right: obviously someone has to do actual work, and not everyone can just make money on investing. That said, it's not a one to one correspondance: if more people are investing, that means there's more capital available for companies to build off of, which means it's easier to get a profitable company off the ground, which leads to more economic growth.

Or you can open your eyes and see the obvious fact: all productivity gains have been cashed by the top 1%.

You have no requirement to invest in your local economy - and indeed, most people invest globally. So while all investment is ultimately funded by the working population, the working population is expanding massively every year if you look at the global picture. In emerging economies in particular, the demand for capital is sky high and one hour of saved income for you can buy you 100 work hours elsewhere in the world.

To simplify: if you work 7 hours a day, but save 3 hours worth of income out of those 7 hours and invest it in a company in a developing economy, you could be purchasing 300 hours of economic activity. So by saving, you have actually worked 300 hours that day (without your capital, those 300 hours would not have been done at all), while if you did not save, there is only 7 hours of economic activity.

>most people's incomes have stagnated or decreased

We stopped the high taxes on the rich, let the minimum wage fall in real terms, and made several other policy decisions which have caused the shift to the rich.

It's not retirees pulling us down (except perhaps arguably in the last week or two or life, drumming up huge medical bills), it's rent seeking.

Reply on news.ycombinator.com