The U.S. budget can't be balanced

[shotgunner]

I think the information in this video is central to ER. Most of us have run firecalc, have analysed our swr, and all of that. The foundation for all those calculations is that the financial picture doesn't stray too far from what we have seen in the past. I have noticed on this and other boards that when someone questions the foundation, it's not a welcome topic. And it is easy to see why...we have all bought into this system, and if it goes too far south, and we go from the good life to something more like the life of those who didn't 'prepare for the future', then we start looking a lot less smart.

But it's not like we, as investors, have our hands completely tied. It might be hard for those of us that have US assets to avoid the possible future tax tsunami, we don't have to ride the USD down the hill, should that come to pass. So having a heads-up on the fact that the US fiscal house is completely out of whack is important to an ER, imho.

OK, but I'm trying to figure out how this could be seen as NOT being related to FIRE? Why would the level of debt's effect on the economy even be questioned? Or what some threads in this forum had to do with FIRE, but were not questioned.


-ERD50

Thank you both. The relationship of this topic to FIRE seemed self evident. I am glad the moderator questioned my intent rather than delete the topic. However I really couldn't believe I had to justify the relationship of this subject to FIRE. To be challenged by a moderator is a bit unwelcoming. I don't post very often but I do try to share relevant material or ask pertinent questions. I am glad that some of you found it intersting enough to respond because I believe whether the debt is addressed or ignored by the politicians either way is going to affect us and affect us a lot.

 

[haha]

Many of us have just given up on posting or commenting on relevant information. Where are those darn cats when they are needed?

 

[FIREd]

[mod hat on]

just a friendly reminder:

If we feel the guidelines are violated we may remove, edit or delete posts and if necessary ban or remove members. Any abuse toward our administrators or moderators may result in immediate suspension of your account. Complaints about a moderator's decision regarding a particular post are not be made in posts; instead send a private message to a moderator. If a moderator deletes or edits one of your posts and you disagree with the action, please contact any moderator or administrator via PM with your concerns. Do not repost deleted material.

Violate the community rules at your own risk.

[mod hat off]

 

[MichaelB]

Many of us have just given up on posting or commenting on relevant information. Where are those darn cats when they are needed?

You don't seem to have given up posting or commenting.

 

[sengsational]

OK, but I'm trying to figure out how this could be seen as NOT being related to FIRE? Why would the level of debt's effect on the economy even be questioned? Or what some threads in this forum had to do with FIRE, but were not questioned.


-ERD50

Some threads are more fun than others. The topic of this thread is decidedly not fun because if the rules change drastically, then why did we all do so much careful planning? This board treated the topic fairly. On other, less refined boards, the mention of an upset in the financial system generates a huge pile of "better stock up on guns and ammo"' comments, even though no one mentioned civil unrest.

I wouldn't mind continuing this conversation toward FIRE but asking, what are the ways that the US can get though this, and how can I defend my nest egg? One comment was that the US would inflate it's way out of the problem. I guess the last time we had 200% GDP problem was WWII, which is a pretty good excuse for such a big credit card bill. This time, I'm not seeing such a good excuse. As to how to defend the nest egg, my dad, who FIREd at 45, used to thank a certain unnamed president when he clipped 15% APR coupons on his way to the bank. Would that be a good defensive move? Buy real long high % bonds when rates are high?

 

[shotgunner]

Some threads are more fun than others. The topic of this thread is decidedly not fun because if the rules change drastically, then why did we all do so much careful planning? This board treated the topic fairly. On other, less refined boards, the mention of an upset in the financial system generates a huge pile of "better stock up on guns and ammo"' comments, even though no one mentioned civil unrest.

I wouldn't mind continuing this conversation toward FIRE but asking, what are the ways that the US can get though this, and how can I defend my nest egg? One comment was that the US would inflate it's way out of the problem. I guess the last time we had 200% GDP problem was WWII, which is a pretty good excuse for such a big credit card bill. This time, I'm not seeing such a good excuse. As to how to defend the nest egg, my dad, who FIREd at 45, used to thank a certain unnamed president when he clipped 15% APR coupons on his way to the bank. Would that be a good defensive move? Buy real long high % bonds when rates are high?

Post WWII the rest of the industrialized world lay in ruins and the US had created a huge manufacturing base. Today the US is a consumer nation and we have the Chinese to compete with. After WWII we still produced most of our own fossil fuel, now we are dependent on others. My crystal ball is murky but I wonder if we are seeing a move to a general decline in the US standard of living as other nations improve theirs. I think inflation is coming too. Will it be as bad or worse than the late 70's? How does one position themselves?

 

[M Paquette]

Post WWII the rest of the industrialized world lay in ruins and the US had created a huge manufacturing base. Today the US is a consumer nation and we have the Chinese to compete with. After WWII we still produced most of our own fossil fuel, now we are dependent on others. My crystal ball is murky but I wonder if we are seeing a move to a general decline in the US standard of living as other nations improve theirs. I think inflation is coming too. Will it be as bad or worse than the late 70's? How does one position themselves?

I think this pretty much sums it up.

When it gets down to it — talking trade balances here — once we've brain-drained all our technology into other countries, once things have evened out, they're making cars in Bolivia and microwave ovens in Tadzhikistan and selling them here — once our edge in natural resources has been made irrelevant by giant Hong Kong ships and dirigibles that can ship North Dakota all the way to New Zealand for a nickel — once the Invisible Hand has taken away all those historical inequities and smeared them out into a broad global layer of what a Pakistani brickmaker would consider to be prosperity — y'know what? There's only four things we do better than anyone else:
music
movies
microcode (software)
high-speed pizza delivery
- Neil Stephenson, "Snow Crash"

 

[sengsational]

Nice that software is in somebody's list as one of the things where the US will retain an edge, since I'm a coder. I'm not sure the US can keep the edge there myself.

One thing we have in abundance is crop land. I say "we", but who knows how much of it is owned by those beyond our borders. What a mass of complexity is the world lately.

 

[Running_Man]

What was amazing is the absolute low level of interest payments relative to the size of the budget and the debt 225 billion on 16 trillion of debt. 1.4% interest, so that a rise to a reasonable interest of 4.5% (inflation of 3% and 1.5 % real income) results in an increase of 500 billion on the national debt, which I think will limit the economy as an offset to any growth initiatives.

I for one never thought the government would be able to sell these large deficits for so long, it would appear to me that whether there is hyperinflation or a deflationary spiral Treasury Bills would be one of the safest investments to hold. Likewise in an inflationary spiral stocks would be necessary as the one of the better investments that would hold it's value.

The United States is lucky in that results in Europe will be evident sooner and Americans should be better able to prepare as a result of the actions that occur there, whether inflation or deflation.

But I do think as is apparent in the President's budget the government will not be able to afford all the promises on Medicare and Social Security and a 35% haircut on the value of those services would be the minimum I would plan for as that would be the average amount of spending cuts needed to balance the budget and at some point, and this could be years from now as well, cuts will be required.

 

[Hamlet]

I'm less dismissive of Krugman after years of everyone else saying interest rates were going to explode (myself included), only to watch them go even lower.

He's been dead right on interest rates since the crash, while his detractors have been dead wrong.

He's been right in his predictions about the effects of austerity in Europe, while his detractors have beend dead wrong.

At what point to people begin to consider the possibility that he may be right?

Yes, Paul Krugman has been saying this, too, for a long time. And he's been wrong as long as he's been saying it. Just ask him--The problem with the stimulus and all the other government spending isn't the deficit hole we're digging, the idea that bondholders may decide they want a higher interest rate to loan us more money, and the drag on our economic future from all the repayments we'll need to make. No, the problem is that the spending hasn't been big enough.

Is "economics" as (practiced by columnists) a science if nothing is testable/falsifiable?

 

[Old Microbiologist]

Political Yes, but definitely related to FIRE

I am going out on a limb here to give my 2 cents on this without being political on a clearly political subject. I do not endorse any party and lay blame where it should be with all past administrations. Both have gotten us into this mess. Anyway, this is a particularly scary prospect and concerns anyone who is either currently retired or contemplating retirement soon. Money, particularly in a fiat currency such as the US dollar or the EU Euro is only as good as the belief that it is good. There is nothing to back it up except faith in the economic system. Clearly each government is approaching this in different ways and the citizenry are reacting in response, sometimes in unpredictable ways. It is extremely interesting to observe and I would only be academically interested except all my money is tied up in the US yet I am living in Europe. So for us what happens in both systems is vitally important. Luckily Hungary where I live is not in the Euro zone and the Hungarian Forint is not a fiat based currency but it has been and remains weak so I am not eager to move my money here. There are 2 basic schools of thought regarding how to get out of a recession (although this could arguably be a depression). The first is the Keynesian concept of spending your way out by creating money and infusing the system with it thus creating jobs which subsequently bolster the economy. This is what has been happening with little effect in the US, perhaps because it is the wrong approach or we haven't created enough money ($15 Trillion isn't enough), or it was put into the economy the wrong way by giving it to banks who then refuse to loan it back out. In Europe they have been using the austerity concept of cutting spending, increasing taxes, and pressing everything hoping to pay it down until things recover. Clearly that isn't working and the people are tired of increasing taxes, rising unemployment, and inequities between countries in the same federalized government (Germany is clearly richer and fully in control over the EU although France's revolt on Sunday by electing a socialist is a clear sign things are not stable). What is interesting is that neither system is working or at least not to the extent it should have by now. In the US no recovery from a recession has ever occurred without the housing market recovering first and the market is actually getting worse so obviously something isn't working. Unemployment is actually increasing but the corporations and banks are seeing record profits so there is a clear disconnect. So, given that it is clear that no one really knows what to do and we seem to be in new territory not amenable to historical economic theories what is one to do? In my own case I am relying on the US government for my military pension and hopefully social security in 3 years. This also BTW pushes people to start considering drawing SS at the minimum age on the assumption it won't last long which will affect SS by moving the drawdown to earlier ages (not older which is what they have been using as a model) which has not been calculated into the plans for SS. I intend to start collecting at age 62 but had previously been planing for age 66. I would rather get something now rather than the increasingly likely prospect of getting nothing in the future. Then we have about $650K in 401K accounts which are in US banks. Actually that isn't so clear cut either as it is invested in IRA's at Scottrade which may or may not be insured. We also have a brokerage account with them at roughly the same amount. If the banking system completely collapses and the US government collapses as well, arguably a worst case scenario, then we have nothing except the house we are living here in Hungary which is free and clear. [MOD EDIT] Defaults on loans here in Europe will really only affect the banks as they are the ones floating the loans. But, the US also has opened up dollar swap lines with the IMF to help the EU deal with it's problems. This ties the US economy directly to Europe and takes on a huge risk particularly in light that the US economy itself is far over-extended. [MOD EDIT]Just having all of our fighter fleet and 3 carrier groups fully deployed is almost as expensive as fighting a war and is unbalancing the economic futures. [MOD EDIT]

 

[Old Microbiologist]

BTW, Social Security and Medicare are separately funded programs with their own tax. The problem is that Congress repeatedly borrows from these funds and never replaces the money they borrowed. Both are self-sustaining and not in Jeopardy if they would leve them alone. Why they come up repeatedly in discussions is an interesting subject all of itself.

 

[REWahoo]

I am going out on a limb here to give my 2 cents on this without being political on a clearly political subject. I do not endorse any party and lay blame where it should be with all past administrations. Both have gotten us into this mess. Anyway, this is a particularly scary prospect and concerns anyone who is either currently retired or contemplating retirement soon. Money, particularly in a fiat currency such as the US dollar or the EU Euro is only as good as the belief that it is good. There is nothing to back it up except faith in the economic system. Clearly each government is approaching this in different ways and the citizenry are reacting in response, sometimes in unpredictable ways. It is extremely interesting to observe and I would only be academically interested except all my money is tied up in the US yet I am living in Europe. So for us what happens in both systems is vitally important. Luckily Hungary where I live is not in the Euro zone and the Hungarian Forint is not a fiat based currency but it has been and remains weak so I am not eager to move my money here. There are 2 basic schools of thought regarding how to get out of a recession (although this could arguably be a depression). The first is the Keynesian concept of spending your way out by creating money and infusing the system with it thus creating jobs which subsequently bolster the economy. This is what has been happening with little effect in the US, perhaps because it is the wrong approach or we haven't created enough money ($15 Trillion isn't enough), or it was put into the economy the wrong way by giving it to banks who then refuse to loan it back out. In Europe they have been using the austerity concept of cutting spending, increasing taxes, and pressing everything hoping to pay it down until things recover. Clearly that isn't working and the people are tired of increasing taxes, rising unemployment, and inequities between countries in the same federalized government (Germany is clearly richer and fully in control over the EU although France's revolt on Sunday by electing a socialist is a clear sign things are not stable). What is interesting is that neither system is working or at least not to the extent it should have by now. In the US no recovery from a recession has ever occurred without the housing market recovering first and the market is actually getting worse so obviously something isn't working. Unemployment is actually increasing but the corporations and banks are seeing record profits so there is a clear disconnect. So, given that it is clear that no one really knows what to do and we seem to be in new territory not amenable to historical economic theories what is one to do? In my own case I am relying on the US government for my military pension and hopefully social security in 3 years. This also BTW pushes people to start considering drawing SS at the minimum age on the assumption it won't last long which will affect SS by moving the drawdown to earlier ages (not older which is what they have been using as a model) which has not been calculated into the plans for SS. I intend to start collecting at age 62 but had previously been planing for age 66. I would rather get something now rather than the increasingly likely prospect of getting nothing in the future. Then we have about $650K in 401K accounts which are in US banks. Actually that isn't so clear cut either as it is invested in IRA's at Scottrade which may or may not be insured. We also have a brokerage account with them at roughly the same amount. If the banking system completely collapses and the US government collapses as well, arguably a worst case scenario, then we have nothing except the house we are living here in Hungary which is free and clear. [MOD EDIT] Defaults on loans here in Europe will really only affect the banks as they are the ones floating the loans. But, the US also has opened up dollar swap lines with the IMF to help the EU deal with it's problems. This ties the US economy directly to Europe and takes on a huge risk particularly in light that the US economy itself is far over-extended. [MOD EDIT]Just having all of our fighter fleet and 3 carrier groups fully deployed is almost as expensive as fighting a war and is unbalancing the economic futures. [MOD EDIT]

One word: paragraphs

 

[Texas Proud]

. Money, particularly in a fiat currency such as the US dollar or the EU Euro /snip/

Luckily Hungary where I live is not in the Euro zone and the Hungarian Forint is not a fiat based currency

How is Hungary's currency not fiat based

Also, from Wiki... but who knows if it is correct...

"As a member of the European Union, the long term aim of the Hungarian government is to replace the forint with the euro"

 

[sailor]

the Hungarian Forint is not a fiat based currency

Can you provide supporting evidence?
I could not Google anything like this - it's certainly not gold based, as the price of gold expressed in Forints changes in time.

 

[Old Microbiologist]

Sorry, you are correct. I meant to say it isn't in the Euro zone but partially relies on Euro based bonds as well as other instruments such as the Swiss Franc and Japanese Yen and now more recently Chinese Yuon. Hungary was scheduled to enter the Euro zone in 2014 but that has been postponed indefinitely which is a good thing. They have unfortunately adopted many austerity measures here as a requirement for getting IMF loans. It is the currency rate swaps which are responsible for many of Hungary's financial woes. Hungary would be far better off going back to the gold standard as amazingly they still have gold. The GDP is loow enough that Apple could easily buy the whole country. They never recovered completely from the Soviet Days and cut their nose off to spite their face by cutting off all trade with Russia which now they are working hard to correct. Hungary's only export market was to the Soviet Union and no markets existed for them otherwise which only really left tourism. They used to have a large chemical industry but that has almost entirely closed but still are an oil producer pumping 30% of internal requirements. Same for gas. Also, due to the presence of cheap but highly skilled labor force Hungary is seen as one of the best places to locate manufacturing and many companies are building plants here as it is close to the European markets. China is building several large factories here for plastics and solar panels. China is also building a huge airport (actually not far from here and not far for the US (oops NATO) air force base here in Papa and the Chinese airport will be in Szombethy to serve as the shipping hub for Europe similar to the Fedex concept. So, for Hungary things are improving. The real estate market hasn't dropped at all and is still active and tourism is at an all time high as Hungary is a very cheap alternative to other more expensive places. Unemployment is at 8% but is misleading as there is a huge black market of labor here. I know of no one who doesn't work if they want to. It is a particularly popular vacation spot for Germans, Austrians, and Brits. It is an excellent place to live if you aren't Hungarian and have a modest income. One requirement for permanent residence visa is to prove financial solvency which is very low by US standards. Anyway, sorry for the misleading fiat currency statement.

 

[NYEXPAT]

I am going out on a limb here to give my 2 cents on this without being political on a clearly political subject. I do not endorse any party and lay blame where it should be with all past administrations. Both have gotten us into this mess. Anyway, this is a particularly scary prospect and concerns anyone who is either currently retired or contemplating retirement soon. Money, particularly in a fiat currency such as the US dollar or the EU Euro is only as good as the belief that it is good. There is nothing to back it up except faith in the economic system. Clearly each government is approaching this in different ways and the citizenry are reacting in response, sometimes in unpredictable ways. It is extremely interesting to observe and I would only be academically interested except all my money is tied up in the US yet I am living in Europe. So for us what happens in both systems is vitally important. Luckily Hungary where I live is not in the Euro zone and the Hungarian Forint is not a fiat based currency but it has been and remains weak so I am not eager to move my money here. There are 2 basic schools of thought regarding how to get out of a recession (although this could arguably be a depression). The first is the Keynesian concept of spending your way out by creating money and infusing the system with it thus creating jobs which subsequently bolster the economy. This is what has been happening with little effect in the US, perhaps because it is the wrong approach or we haven't created enough money ($15 Trillion isn't enough), or it was put into the economy the wrong way by giving it to banks who then refuse to loan it back out. In Europe they have been using the austerity concept of cutting spending, increasing taxes, and pressing everything hoping to pay it down until things recover. Clearly that isn't working and the people are tired of increasing taxes, rising unemployment, and inequities between countries in the same federalized government (Germany is clearly richer and fully in control over the EU although France's revolt on Sunday by electing a socialist is a clear sign things are not stable). What is interesting is that neither system is working or at least not to the extent it should have by now. In the US no recovery from a recession has ever occurred without the housing market recovering first and the market is actually getting worse so obviously something isn't working. Unemployment is actually increasing but the corporations and banks are seeing record profits so there is a clear disconnect. So, given that it is clear that no one really knows what to do and we seem to be in new territory not amenable to historical economic theories what is one to do? In my own case I am relying on the US government for my military pension and hopefully social security in 3 years. This also BTW pushes people to start considering drawing SS at the minimum age on the assumption it won't last long which will affect SS by moving the drawdown to earlier ages (not older which is what they have been using as a model) which has not been calculated into the plans for SS. I intend to start collecting at age 62 but had previously been planing for age 66. I would rather get something now rather than the increasingly likely prospect of getting nothing in the future. Then we have about $650K in 401K accounts which are in US banks. Actually that isn't so clear cut either as it is invested in IRA's at Scottrade which may or may not be insured. We also have a brokerage account with them at roughly the same amount. If the banking system completely collapses and the US government collapses as well, arguably a worst case scenario, then we have nothing except the house we are living here in Hungary which is free and clear. [MOD EDIT] Defaults on loans here in Europe will really only affect the banks as they are the ones floating the loans. But, the US also has opened up dollar swap lines with the IMF to help the EU deal with it's problems. This ties the US economy directly to Europe and takes on a huge risk particularly in light that the US economy itself is far over-extended. [MOD EDIT]Just having all of our fighter fleet and 3 carrier groups fully deployed is almost as expensive as fighting a war and is unbalancing the economic futures. [MOD EDIT]

You touch on so many issues here (I may or may not agree on) that it is difficult to respond. I will however agree on the other poster's suggestion of adding paragraphs, which will make it easier to respond.

Thinking what your thinking, I am quite surprised that you had not moved your assets overseas earlier (not necessarily Europe) although Andorra may have been an excellent choice until a few months ago. Before I moved to SA the bulk of my assets were long gone.

It is small consolation but if you are ever in NYC, American citizens can open up Yuan accounts at the Bank of China. I forget, but I believe you can convert up to $20,000.00 per year, your money stays in the USA and it is FDIC insured and does not violate any reporting requirement or require a FBAR. While this move does not trigger a taxable event (the accounts pay no interest) it will afford you some Dollar protection.

As it relates to the discussion at hand, many people are of the opinion that the USA will try to fix this problem by stoking inflation while misreporting/massaging inflation numbers further debasing it's currency, as most countries are doing, only the USA is better at it.

 

[snodog]

Hmmm - I when to a lecture the other day from an econ. prof at UMKC (aka the OWLS).

We need a much bigger deficit - not smaller! The idea that a big deficit is going to hurt us is totally wrong - aka sort of like believing in the flat earth.

Kinda left me listening with my mouth hanging open. Totally opposite of what I was used to hearing.

Paying off the deficit is very bad for us - and our children/grandchildren.

heh heh heh - being single, retired and with a untaxed portfolio I feel like I have a target painted on my back - future tax wise.

You are exactly right and I was saying the same thing around here last year. This idea that government debt is a burden to our children is not only misguided it is completely false. Each generation gets to consume what it produces. That is the only way it can be when you logically think about it. The people who are saying the national debt should be reduced are really saying there is too much money in the economy. I don't think there is too much money, there is too little.

And the difference between Krugman and the deficit owls (mmt) is that Krugman thinks we should pay down the debt in good times where mmt says paying down the debt in good times is what leads to bad times.

 

[ejman]

You are exactly right and I was saying the same thing around here last year. This idea that government debt is a burden to our children is not only misguided it is completely false. Each generation gets to consume what it produces. That is the only way it can be when you logically think about it.

And the difference between Krugman and the deficit owls (mmt) is that Krugman thinks we should pay down the debt in good times where mmt says paying down the debt in good times is what leads to bad times.

If one thinks about it, FDR's New Deal was not effective in reducing unemployment significantly largely because it initially was not big enough to override the massive decline in economic activity and subsequently got the balanced budget religion. WW II came to the rescue and what was WW II in economic terms? The mother of all stimulus packages. It finally broke the back of the depression. Although I don't think (at this time) we are in for Big Depression II I do think we are in for a long long Japan like no growth environment with unemployment at roughly current levels as far as my eye can see. (WARNING my crystal ball is the baroque model)

 

[John Galt III]

As it relates to the discussion at hand, many people are of the opinion that the USA will try to fix this problem by stoking inflation while misreporting/massaging inflation numbers further debasing it's currency, as most countries are doing, only the USA is better at it.

Regarding planning ahead for retirement : I was afraid of inflation and wondering what to buy as a hedge. People told me not to worry, since the interest on savings and Cd's would go up when inflation hit. But here we are with high inflation (in the things I have to buy) and the rates are still at rock bottom. Must be a corollary of Murphy's Law, eh ??

 

[Hamlet]

Outside of health care and college tuition, what are you seeing recent inflation in?

Most of the things I buy were actually more expensive in 2008.

For all the talk about high gas prices, they are actually lower than they were four years ago.

We had a lot of inflation from 2000 to 2008.

Not a whole lot since.

Regarding planning ahead for retirement : I was afraid of inflation and wondering what to buy as a hedge. People told me not to worry, since the interest on savings and Cd's would go up when inflation hit. But here we are with high inflation (in the things I have to buy) and the rates are still at rock bottom. Must be a corollary of Murphy's Law, eh ??

 

[marko]

Outside of health care and college tuition, what are you seeing recent inflation in?

Most of the things I buy were actually more expensive in 2008.

For all the talk about high gas prices, they are actually lower than they were four years ago.

We had a lot of inflation from 2000 to 2008.

Not a whole lot since.

My food bill is higher.
My property taxes are higher.
My electric bill is higher.
My local income tax is higher. Come Jan, ALL our taxes will be higher.
My airfare is higher.
My fishing license is higher.
My liquor cost is higher.
My golf fees are higher. Golf balls cost more too.
The kid that does my lawn charges more.
My dry cleaner is higher.
My haircutter is higher.
My co-pay at the doctor is higher
My prescriptions are higher.

If you live under a rock and don't use any of the above, maybe your costs went down. Then again...maybe it's just me.

This link shows the US inflation rate since 2002.
http://www.usinflationcalculator.com/inflation/current-inflation-rates/

Looks pretty consistent to me at about + or - 3%

 

[EvrClrx311]

You can also produce a list just as long of things that have gone down in value. I think it is safe to say overall cost of living (or inflation) has been extremely low... since 2008

My airfare is higher.

IMO, airfare is cheaper now.... or at least there is access to cheaper tickets because of all the online sites, if you are flexible.

My property taxes are higher.

Here, the rate is higher... but the overall payment is lower due to home values dropping.

The kid that does my lawn charges more.

So many people are out of work that lawn mowing costs have come down here as businesses take jobs from the neighborhood kids that were charging $20 a week.

Also...and this is a huge one:

- mortgages are substantially lower (if you've refinanced). I pay $600 less a month in interest (saving over $7,000 a year) for the same home with roughly the same size mortgage.

 

[marko]

You can also produce a list just as long of things that have gone down in value. I think it is safe to say overall cost of living (or inflation) has been extremely low... since 2008







Here, the rate is higher... but the overall payment is lower due to home values dropping.



So many people are out of work that lawn mowing costs have come down here as businesses take jobs from the neighborhood kids that were charging $20 a week.

QUOTE]

Airfare?! They now charge you for your carry on luggage! The fare is lower but they make it up with $50 for two bags, airport fees and fuel surcharges.

Of course some things have gone down...clothing costs for instance due to a lot of stuff coming from China and Viet Nam. Natural gas price drops have also helped on the home heating front. No complaints!

Here in Mass however, the property taxes continue to go up (what we pay in actual dollars) despite a drop in housing values. (One more reason to leave this parasitic State)....and lets not get into the assortment of fees and local taxes that have surfaced in the past 5 years.

Around here, the politicians have two justifications to tack on another fee: "It's for the children" and "for the cost of a cup of coffee".

Maybe its just where I live (until I decide I"ve had enough). YMMV.

 

[EvrClrx311]

Maybe its just where I live (until I decide I"ve had enough).

I wouldn't doubt it is very much a regional thing...