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Comment by omarchowdhury | Hacker News Reader

Anonymous people over the web have become guides to personal finance, reddit just facilitates that. The same advice was available during the "blogging/RSS era".

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Yes, the advantage of Reddit is that you can more easily see the group consensus on an issue, as well as differing opinions (as long as those differing opinions aren't considered so extreme/wrong that they get heavily downvoted, which is certainly possible).

True enough. The anonymity also leads to people being more candid, and that generally means an unveiling of information asymmetries.

The group consensus seems to be to get the largest mortgage your bank will give you, buy an oversized car on a 7 year contract plan and fritter the rest on beer and takeaways. The best financial advice is usually drowned out by the consensus.

What? This is absolutely the opposite of the consensus advice you'll get somewhere like r/personalfinance.

It sounds like you're completely ignorant of the subs in question, and just spouting off whatever comes to mind.

I think tonyedgecombe is pointing out that relying on 'group consensus' is not a golden bullet, as the consensus revealed preference of the national population conflicts with the consensus advice of subreddits' self-selected populations

Bit of a useless point then, isn't it? Of course group consensus of people who care about finance is going to be more useful to finance discussions than group consensus of the general population. And it's the former that we were discussing anyway.

Not to mention what they're describing isn't a group consensus on financial advice, it's just the stereotype of lowest common denominator behavior. It's like suggesting that there's a group consensus that playing the lotto is sound financial wisdom just because a large number of people do participate in it.

It's basically the word for word consensus advice of decades past. At least two generations grew up in a world where "take out the biggest mortgage you can" was considered good advice by default. As history has proven that is not a consistently successful approach for individuals and has some pretty severe trade-offs at the societal level. I'm not sure if it was the point he was trying to make but in any case it should probably serve as cautionary tale that consensus is not necessarily correctness.

But we're discussing the group consensus of a self-selected group of people interested in finance, who are nerding out about it on the internet, not the group consensus of the general population.

"Take the biggest mortgage you can" became known by the general population because it was repeated again and again by every financial literacy magazine, talk show and newspaper advice column back in its day. If anything that is an even more refined interest group than Reddit because you needed more than an internet connection and an interest to get into it.

However the group of all people in society and group of people interested in personal finance proactively finding and using these subreddits are different.

Nonsense. This is the polar opposite of what anyone in personalfinance subreddits will recommend.

This is true of all subbredits. Basically the best way to use Reddit if you get into a hobby is to go to that hobby's sub, meticulously read the sidebar and leave the site without ever posting.

You can see group consensus even when it doesn't exist. Reddit's upvote/downvote system does a very good job of fudging consensus on issues where you've got 49.9 one way and 50.1 the other.

There is whole generation of people who were reading goldbug blogs and absorbed investment advice from iconoclastic bloggers. They also read Mises and Larry Kudlow's articles to learn economics.

You can still see the result. The most common response to any bad economic news is short 1-4 sentence outburst about how Fed is printing money, no matter how irrelevant it is to discussion.

And the responses about the responses about how the Fed is printing money. And the response about the response about the response, no matter how irrelevant it is to discussion :)

> Anonymous people over the web have become guides to personal finance, reddit just facilitates that. The same advice was available during the "blogging/RSS era".

Every generation needs their own form. Before blogging/RSS it was cable financial news on TV, before that magazines, and before that I don't know.

Basic financial literacy (creating a budget, tracking it, adjusting) is sorely lacking.

Today, you may be adept at trading $10k of stocks on Robinhood using money that you're parents gave you hoping over the year for a big 20% win, but you'll equally forget that you have $10k of credit card debt with interest accruing at 30%.

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