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Old 01-08-2010, 06:27 AM   #81
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"One of my high school friends, whose father was a doctor, once told me that it wasn't until 8th or 9th grade before he realized that not everyone went to college. He just assumed college was a natural extension of high school. I was the opposite. It wasn't until 8th or 9th grade before I realized that it wasn't just the very rich who went to college (without an athletic scholarship).

It's not a lack of opportunity, at least in the United States. It's about perception and personal choice."

In the US, this is so true - the expectations in one's household as they are growing up can have a large impact - it was expected that my brother and I would go to college from birth on....my brother opted not to, and it sent shock waves through the family. I of course, bring the good oldest sibling, did as expected of me. I also see this in my husband's sons. The expectations where they live daily are not the same as they were for me and the results currently are what I would expect - not upwardly mobile.

I think we in the US are also captive to our culture and understand poverty differently. When one sees the type of poverty in third world countries, one is understandably shocked at times. However, from the perspective of the other person, they may not see themselves as poor - and in their society, they may not be. It comes down to expectations - additionally, psychologists have shown that people tend to compare to those closest around them - i.e. their neighbors and family.

What is a leveling factor today is the access to technology showing those material disparities between the different countries/cultures. Satellite TV, the internet, cell phones have made an awareness of the difference much more widespread around the world - is that good or bad - I don't know, however, the comparison 'circle', if you will, then becomes wider. From a political perspective, the government of a poorer nation now needs to explain why its population cannot enjoy some of those material riches one sees on TV, the internet, etc.

So, yes, luck, genetics, environment, etc. The old 'nature versus nurture' argument - although as I get older (and my grandmother used to say this as well), it seems as genetics plays a larger part.
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Old 01-08-2010, 07:29 AM   #82
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It it interesting to see that we tend to view this stuff through the lens of immediate family. I recently realized that I am the way I am about food because of how my parents grew up. Both grew up poor with frequently not enough to eat, so when I was growing up food was always to be luxuriated in (with predictable results).
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Old 01-08-2010, 09:13 AM   #83
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That does not keep us from arguing about mundane stuff. Given the same facts, we wander off to different conclusions
There is no doubt that being "rational" does not mean that you reach the same conclusions as someone else, even given the same data. Results may vary widely. I am not suggesting that being rational makes one some sort of robot, or that if your decisions are different from mine you are irrational.

The point is that you make your decisions with a firm understanding and conscious acceptance of the long, medium and short term cost and benefits of your decisions, to yourself, your family and your society, and that you decisions are based on critical (skeptical) analysis of all available data.

I think most people make decisions primarily based on two factors; 1) what make them feel good right now 2) what they believe their peer group expects them to do. I think we all do this occasionally, but let's try to keep it to a minimum.
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Old 01-08-2010, 09:49 AM   #84
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I think it takes being born in the right conditions and finding that right mate. I got real lucky and got the last one and the rest just fell in place
I think an error of the current era is the young putting so much energy and focus into carreer, and leaving spouse-finding as an after-thought.

this should not be left to luck.
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Old 01-08-2010, 10:03 AM   #85
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Straw man. I would argue the rational actor would most likely not be in that position to begin with. The rational actor would also not want to live in a world where anyone with less money felt free to knock off anyone with more.
now you have departed from the rational and into the realm of ethics. What you have described was referred to by Kant as the "categorical imperative." It is not rational in that it attempts to determine one's personal behavior based on one's desire as to the behavior of others which you have no control over. That was sort of my point in the first place.

Part of the problem in our society, imo, is that corporations seem to lack the capacity for ethical thinking and merely behave 'rationally.'
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Old 01-08-2010, 07:35 PM   #86
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Please excuse a quick diversion from the theme of this thread, whatever it is or was, so I can indulge a bit in the subject of the "rational behavior".

Two years ago, I happened to pick up and read this book, The Myth of the Rational Voter: Why Democracies Choose Bad Policies by Bryan Caplan. An excerpt from the publisher's synopsis follows. I am no economist nor a political science student, yet enjoyed it more than I had expected. I have recommended the book in this forum before, but since the word "rational" was brought up, thought I would mention it again. As I remember, Caplan was using the term "rational" as in Rational Choice Theory, where individuals act to maximize their economic benefits.
Boldly calling into question our most basic assumptions about American politics, Caplan contends that democracy fails precisely because it does what voters want. Through an analysis of Americans' voting behavior and opinions on a range of economic issues, he makes the convincing case that noneconomists suffer from four prevailing biases: they underestimate the wisdom of the market mechanism, distrust foreigners, undervalue the benefits of conserving labor, and pessimistically believe the economy is going from bad to worse. Caplan lays out several bold ways to make democratic government work better--for example, urging economic educators to focus on correcting popular misconceptions and recommending that democracies do less and let markets take up the slack. - Princeton University Press
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Old 01-08-2010, 09:54 PM   #87
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It it interesting to see that we tend to view this stuff through the lens of immediate family. I recently realized that I am the way I am about food because of how my parents grew up. Both grew up poor with frequently not enough to eat, so when I was growing up food was always to be luxuriated in (with predictable results).
Same here brewer.
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Old 01-09-2010, 11:02 AM   #88
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Well, we typically train our children for 18-26 years, and only about 0.5% of that training is how to NOT BE POOR. Oddly, not training them to be wealthy works.
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Old 01-09-2010, 12:06 PM   #89
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Well, we typically train our children for 18-26 years, and only about 0.5% of that training is how to NOT BE POOR. Oddly, not training them to be wealthy works.
So true!
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Old 01-09-2010, 05:06 PM   #90
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It it interesting to see that we tend to view this stuff through the lens of immediate family. I recently realized that I am the way I am about food because of how my parents grew up. Both grew up poor with frequently not enough to eat, so when I was growing up food was always to be luxuriated in (with predictable results).
Both DW and I have parents who lived through the depression on farms in Canada's dustbowl (think okies from the Grapes of Wrath). Their parents survived on the land by cutting expenses (gopher stew is a treat). No one squeezes a dollar harder, the queen screams before they let her go. We seem to have inherited that trait but I'm not convinced it hits the third generation. One of our kids is a bit that way and the other to be polite isn't.
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Old 01-09-2010, 06:46 PM   #91
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Curious - are you the eldest? I am, and financially do better than my sibs.
I apologize for the delayed response. Actually, I'm the youngest (and voted as such in the birthorder thread). My brothers are 4 1/2 and 6 years older than me, so there is a significant but not huge difference.

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Shawn do your bothers make it ok on what they make? Do your bothers save any money? My father always said it was an advantage to grow up poor.
I believe my brothers make it OK on what they make (although I haven't spoken to them in many years). I don't know about their savings. At one time, the one who makes $10K/yr saved money. I doubt the one who makes 35K/yr is a big saver. That's not his personality.

I believe your father was right. There is an advantage to growing up poor, assuming you grow up in the United States or similar countries where opportunities are abundant. I have no regrets about my upbringing. Among other things, it's taught me to be very frugal. In turn, that has caused me to save and be financially secure.
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Old 01-09-2010, 11:11 PM   #92
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No one squeezes a dollar harder, the queen screams before they let her go. .
I love it! The expression I heard, talking about the old Indian-head coin,
was "Squeeze every nickle until the Indian rides the buffalo"

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Old 01-10-2010, 04:28 PM   #93
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Who says people are poor? I was watching a few Suze Orman shows and it seems like people calling in usually are couples with 8-10k monthly NET income AFTER all taxes, social security, medicare and everything or 1 person with 4-5k net income... I think this corresponds to ~100k in salary for 1 person (with taxes, medicare, SS, and if not enough, also 401k/IRA contributions, which I think are also NOT counted there in net income adding up to 40-50%).. not bad at all..

Ok, maybe some are still poor for spending it all but I am amazed at those income numbers. Maybe it's a show for "high-income-high-debt" audience only?
When I lived in California, I was amazed at the hyper consumerism of my friends. Sitting in a restaurant in san Francisco with 3 girlfriends - all unmarried- the discussion turned to finances. I listened as every single one bemoaned the fact it was impossible to "get by" on $100,000. per year....this was in 2001. I left California in 2002, bought several ranches in Oklahoma and "get by" quite well with considerably less than my previous life. And by the way, 2 gals are now downsized living paycheck to paycheck, and the other one...well she married a guy with plenty of money and she is educating him on how to spend!
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Old 01-10-2010, 09:08 PM   #94
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Starting close to home, i'd have to agree with comments that it is hard for people who grow up in comfort to develop into frugal adults. I watched two of my mother's siblings blow significant inheritances and end up being declared bankrupt because of a combination of excessive consumption, bad investments and an economic downturn. I suspect that they would have reached the same point even without the recession. In effect they became poor by choice.

In my career I have had to deal with people who were either trying to make money (usually borrowing to invest in real estate or starting up a business) or were in the process of losing it (company being placed in receivership or home being sold by a mortagee). In the majority of cases of those in trouble, it was the decisions made by the individuals involved which got them into financial difficulties. If I had to point to a single most common causative factor, it would be cash flow - not making sure that they have the ability to service their borrowings when things do not work out as planned. (As and aside, this is a lesson I have taken on board with my own investments - I only buy investment properties when I can put enough equity in to be cash flow neutral (at worst) on a P+I mortage from day one.)

Factors like job loss, disability and divorce do happen but were, to the extent that my experience is representative, very much in the minority.
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Old 01-11-2010, 10:06 AM   #95
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A few years ago my reply would have been much different than the one Iím about to write. In years past, my reply would have been full of reasons why some people are poor and why I, due to some heroic effort of my own, am not. I wouldíve blamed them for making poor choices or for being stupid or lazy, etc. and I wouldíve certainly patted myself on the back for not making some of those bad decisions that lead to becoming poor.

After much reflection, luck, more than anything else, has played a major part in my NOT being poor. I have two siblings and both of them, it seems, have not been as lucky. None of us hit the ďovarian lotteryĒ but as I age, I find that Iíve hit a few, more important lotteries that have enabled me to attain what financial success Iíve been fortunate enough to attain. Iíve hit the intelligence lottery, which has enabled me to make rational choices and think through decisions I make and the consequences of those decisions. This is especially helpful when making decisions that affect my long-term goals such as retirement. Additionally, Iíve hit the powerball when it comes to the spouse lottery. DW is the main reason why I am who I am today. Iíll just say that without her, my life would be much different. And not for the better. There are a number of other minor lotteries Iíve matched up a number or two on along the way. But, to save space, Iíll leave those out.

So, Iíve learned that Iím not nearly as great as I once thought I was. It was nice to think of myself as some sort of superman but those thoughts were clearly misguided. Iím just thankful that Iíve been as fortunate as Iíve been. I just hope my good fortune continues.
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Old 01-12-2010, 10:39 AM   #96
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Very good thread

I was born at an Airforce base NC, Dad was in Vietnam and we lived in a tobacco field...

When Dad got out out he was mentally damaged by the war and my parents divorced after having 4 kids...

Dad never had any kind of real job after the war and pretty much was a ward of the state...

Mom and my Grandma raised 4 kids on her small income working in the meat department at a grocery store...

Mom made our clothes herself and we got by barely...

Then she met and married a local Cop and life got much better...

Their retired and doing fine these days, not rich but living comfortably...

Grandma was never anywhere close to rich but she made it 93.

I cant even count her offspring, but family was there for her until the end...

Personally I believe in Karma, a lot of the poor people I've known were bad people They have bad luck because they get what's coming to them

I quit school at 17 and if you would have told me Id be where I am now then I wouldn't have believed it

I guess I got lucky when I got a job at the steel forge making $7.50 an hour back in 1990...

The company had just started an ESOP (Employee Stock Ownership Plan)...

It truelly was a good deal, you get a stake in the company and work hard, the company does good you do too...

I worked VERY hard and me and the company did very well

Things could have turned out much different for me If Id have kept on trying to be an auto mechanic

So I guess being in the right place at the right time (luck) had some to do with my success...

But my two brothers and my sister are doing very well for themselves also.

I am also the oldest one.

I will credit my parents and my Grandmother for teaching me right from wrong and a good work ethic...

I think there's good and bad people out there, the good people usually overcome the odds and the bad people usually get what they deserve...
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Old 01-12-2010, 12:06 PM   #97
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A few years ago my reply would have been much different than the one Iím about to write. In years past, my reply would have been full of reasons why some people are poor and why I, due to some heroic effort of my own, am not. I wouldíve blamed them for making poor choices or for being stupid or lazy, etc. and I wouldíve certainly patted myself on the back for not making some of those bad decisions that lead to becoming poor.

After much reflection, luck, more than anything else, has played a major part in my NOT being poor. I have two siblings and both of them, it seems, have not been as lucky. None of us hit the ďovarian lotteryĒ but as I age, I find that Iíve hit a few, more important lotteries that have enabled me to attain what financial success Iíve been fortunate enough to attain. Iíve hit the intelligence lottery, which has enabled me to make rational choices and think through decisions I make and the consequences of those decisions. This is especially helpful when making decisions that affect my long-term goals such as retirement. Additionally, Iíve hit the powerball when it comes to the spouse lottery. DW is the main reason why I am who I am today. Iíll just say that without her,
my life would be much different. And not for the better. There are a number of other minor lotteries Iíve matched up a number or two on along the way. But, to save space, Iíll leave those out.

So, Iíve learned that Iím not nearly as great as I once thought I was. It was nice to think of myself as some sort of superman but those thoughts were clearly misguided. Iím just thankful that Iíve been as fortunate as Iíve been. I just hope my good fortune continues.
Great post. I've realized the much of my financial success comes from the birth lottery - I got the genes that lead to decent incomes in the 20th century. However, there are other ways that I haven't been so lucky, so I've seen both the good and the bad of this.

It's easy to decide that the reason for our successes is hard work and good judgement, while blaming failures on bad luck and bad people. But, when I think about this rationally, that combination doesn't seem likely.
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Old 01-12-2010, 12:20 PM   #98
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I think an error of the current era is the young putting so much energy and focus into carreer, and leaving spouse-finding as an after-thought.

this should not be left to luck.
I agree. Do what I did.

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Old 01-12-2010, 06:02 PM   #99
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This is hysterical. However, I am not surprised that it works.

One detail- it appears that in many weeks your total time allotted to togetherness could be consumed by sexual activity. Nice work if you can get it, and if anyone can it is likely to be you.
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Old 01-12-2010, 06:09 PM   #100
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That was so sad & funny . You probably had a chart rating your dates .
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