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Comment by A4ET8a8uTh0 | Hacker News Reader

It is very interesting all things considered. I am personally mildly concerned about the coming years for a variety of reasons, but I have to admit that I am a little surprised that all the talks about recession, inflation and layoffs only seemed to make people buy more tangible goods to hold on to.

I am still trying to make some sense of all this.

One could argue that several recessions should have already happened ( and recent bank collapse was a signal of one such event ), but were merely held back by government rescue/bailout ( depending on your perception of things ).

edit: Oh yeah, and old guard trying reintroduce working in office by decree. It all does not really add up.

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> only seemed to make people buy more tangible goods to hold on to.

I wish I knew more of the truth/could make sense of the sea of stats/data out there on the topic of:

break down America's population by their wealth/income. anybody who isn't in debt and makes a decent income, we don't have to "worry" about

you see headlines that a lot of people are struggling, living paycheck to paycheck, in debt, housing is broken compared to 40 years ago and an entire generation on average can't afford to buy an average house on their average income

but then we have another group of people, not billionaires or $10-$100m, just like "average" rich people who have so much money it's affecting the entire system with high demand for tangible goods?

I personally can't make sense of it. I know both can be true, but I see it as a balance/see-saw in my mind. I know America doesn't work for everybody, etc. etc. I'm talking purely from a "how healthy is the economy right now" perspective. How is that we have what feels like polar opposite narratives constantly being mentioned (tons of poor people suffering/unable to get by + shrinking middle class versus too strong of a labor market and almost too much demand.

Is this all really just "appropriate response" to the fiscal/monetary policy done by the US government + federal reserve during covid?

You may be surprised at the sheer size of the American millionaire class. I know I was. It’s a good chunk of the population. Looks like there’s about 25 million millionaires in the States in 2021. Collectively, they can spend a hell of a lot of money.

I got this information from the Credit Suisse Global Wealth report - hopefully it’s reliable information despite that fact.

https://www.credit-suisse.com/about-us/en/reports-research/g...

https://www.credit-suisse.com/media/assets/corporate/docs/ab...

Checking it now, will update this comment with "how big is the American millionaire class"

https://www.zippia.com/advice/millionaire-statistics/#:~:tex....

I edited my comment before I saw yours, sorry.

Don't be sorry. I appreciate the conversation.

> Looks like there’s about 25 million millionaires in the States in 2021. Collectively, they can spend a hell of a lot of money.

I feel like people who scrape in and are "technically worth" $1m or $2m on paper (most likely due to single family home ownership appreciation over time) but still need to work a job/support a family probably shouldn't count but other than that... it sounds like you and I are in alignment that of the ~160m working "taxpayers", 15% of them are millionaires who are basically unaffected by any recessionary downturns at the moment and are still out there spending like crazy? (like $20k Formula 1 Miami or $12k Warriors courtside tickets)

Note that this is per adult, not per household. Some measures also exclude primary residence.

> only seemed to make people buy more tangible goods to hold on to.

In an inflationary market it makes a lot of sense to buy today what you can't afford tomorrow.

Or perhaps we have less understanding of what makes the economy buzz than we think?

This ^^

Economics is a pseudoscience, after all. In fact, it's probably just an extension of psychology. Nobody really knows what makes the economy tick, but one thing that can somewhat measure the economy's general strength is the M2 Velocity chart. If the velocity of money is high, it means lots of different people are out spending money and keeping money in quick circulation as opposed to hoarding it.

> In fact, it's probably just an extension of psychology.

This is true to the extent (and only to the extent) that behaviorism eventually managed to poke a little bit into economics, which had been dominated by the ivory tower rational actor model detached from empiricism before and longer than any of the other social sciences.

Or we have more? I hate to be That Guy, but all the apocalyptic nonsense about inflation and debt and crypto and spending and fiat currency and pestilence and whatever has been almost exclusively propagated via too-online echo chambers like the one right here on HN.

There are Serious People out there too, real economists who have been studying this stuff for whole careers. And quite frankly they haven't been saying any of this stuff. I think it's great that people (especially the GP) seem willing to reevaluate their priors. But maybe while you do that you could nod to the expertise of those "elites" you've been trying to ignore?

> recession, inflation and layoffs only seemed to make people buy more tangible goods to hold on to

Why is it surprising? As long as you believe that your job is secure, if you believe higher inflation is coming then buying things now may be a good solution.

Some of it is political, I'm certain. If a recession happens, the parties in power usually flip. The talking heads have been talking of a looming recession for probably 5-8 years now.

What are these variety of reasons?

Well, election always stirs things up. And this one will have fancy new fake movies, sounds, you name it generated on the fly. One can only imagine the level of crazy it will unleash.

Related to that is the current level of crazy, which seems higher than what I normally observe. Only a year or so ago I ascribed it to people slowly moving back to the office, but it seems more lasting than expected ( crazy driving mode, less patience, more curt behavior and so on ).

And it seems that some of the previously fringe interests became mainstream in a weird way ( including memes among others, and how they weirdly can predict -- or cause -- events ), which only seems to further destabilize current society.

Note that all of these are not really economic changes. Something else else shifted apart from the usual stories about politicians being politicians.

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