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I've always felt that the bad feelings towards moneylenders was sort of misplaced, whether it be banks, loan sharks, or Jews. Nobody forced you to take the money. I guess loan sharks I can understand because they break your kneecaps. But banks? "Oh no, I bought too much poo poo I couldn't afford and now I have to declare bankruptcy and get my wages garnished." It's not like we have debtors' prison or anything.
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Mar 9, 2016 17:41
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Predatory lending is definitely a refined science at this point and there's a lot of peer pressure to have things like a house or car on par with one's peers, so I don't think it's that misplaced. The lenders absolutely leverage peoples lack of education and math skills, and there are additional perverse incentives around lending that lead to even more immoral behaviour (like obfuscating actual prices and things like that). I sort of feel like being good with money and thumbing noses at people that aren't as good with it is another form of "gently caress you, got mine". Edit: Also when bad financial things happen to people regardless if it's their fault or not, suicide and divorce rates spike. Like in Alberta recently with the price of oil dropping, there's a higher suicide rate than has ever been seen in that province. I would find it hard to look at that and not feel bad. Less Fat Luke fucked around with this message at 19:23 on Mar 9, 2016 |
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Mar 9, 2016 19:20
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I don't think I'm even good with money, especially compared to others in this forum. And it's not like I feel bad for the banks either. But sometimes people complain about the most basic poo poo to the point where you want to ask them "Dude, you knew when you took out the loan that you actually had to pay it back right?"' DARE taught everyone in our generation about peer pressure so that ain't no excuse.
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Mar 9, 2016 19:31
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Yeah I hear you. I also recommend the Bad With Money thread - there are literally people linked (on Reddit) who get credit cards and don't understand the basic concept that it's money you borrow and have to pay back. I really hope they're trolls but I'm sure they're not.
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Mar 9, 2016 19:34
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potatoducks posted:I've always felt that the bad feelings towards moneylenders was sort of misplaced, whether it be banks, loan sharks, or Jews. Nobody forced you to take the money. I guess loan sharks I can understand because they break your kneecaps. But banks? "Oh no, I bought too much poo poo I couldn't afford and now I have to declare bankruptcy and get my wages garnished." It's not like we have debtors' prison or anything. Here in Canada they hand out lines of credit like candy. It feels fairly predatory, but since most people's goal is to live their lives to the absolute maximum by the way of having the nicest house, cars and vacations as possible, and they want them NOW, I guess I can't blame the banks for their behaviour. Even if they told someone the true financial costs of borrowing money to fund a granite counter-top, people would still want their granite counter-tops. My slight frustration comes in when I realize that not only am I unwilling to borrow money to purchase a livin' large lifestyle, I'm not even willing to spend more than 50% of the money I make to fund such a lifestyle. It certainly makes my life look a lot different than most. But I'm fine with that - "gently caress you, got mine", says forums poster Less Fat Luke.
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Mar 9, 2016 19:37
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Rick Rickshaw posted:My slight frustration comes in when I realize that not only am I unwilling to borrow money to purchase a livin' large lifestyle, I'm not even willing to spend more than 50% of the money I make to fund such a lifestyle. It certainly makes my life look a lot different than most. But I'm fine with that - "gently caress you, got mine", says forums poster Less Fat Luke. I have definitely felt those frustrations though. My partner and I moved from a 2 bedroom to a 1 bedroom apartment and were literally mocked for "downsizing", and are in our late 30s and people openly tease us about not buying a condo. In Toronto. So try not to take that line so seriously, I'm definitely feeling some of that too! 
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Mar 9, 2016 19:47
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If the ad industry is any indicator, it's pretty easy to short circuit the human mind into acting against its own interest. I'm not sure if that makes every advertiser evil, especially given the free services that only exist because of advertising, but it's enough for me to avoid them. Lenders are just one high-stakes instance of this.
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Mar 9, 2016 20:40
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There is a definite disparity in the power relationship between the bank and the individual that is heavily in favor of the banks and borders on the criminal in the way certain groups are targeted (ie, blacks and Latinos getting shittier lending terms). None of that is happening in a vacuum either - large swaths of the population gets straight up hosed when it comes to accessing quality education, healthcare, unleaded water, and all those other things that allow one to avoid such blatant poverty traps and amass capital. Saying 'nobody made them take out a loan lol' would a little more acceptable if, say, society gave enough of a poo poo about everyone in it to ensure they had an acceptable quality of life significantly higher than 'omg but poors have fridges'. But that would be communism or something so it's never going to happen in an American setting. What's truly impressive though is that some are willing to draw the FYGM line on the opposite side of whatever benefits them, which generally only happens because that person has already lost an even greater power disparity - private capital that's been leveraged into political capital to ensure its own interests instead of citizens at large. In other words, 
Guest2553 fucked around with this message at 02:00 on Mar 10, 2016 |
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Mar 10, 2016 01:58
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Pryor on Fire posted:the fact that they just created all the money they are loaning you out of thin air thanks to fractional reserve banking. The money you're paying them back didn't exist before you took out the loan, so even at a negative interest rate they will theoretically make money. That's not how fractional-reserve banking works
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Mar 10, 2016 02:59
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Well it has been a long time since grad school for me, if you have a correction or different way of explaining how money doesn't exist before you take out the loan feel free to chime in!
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Mar 10, 2016 20:28
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The money exists, gets deposited in the bank, then gets lent out by the bank. The closest money comes to being created from nothing is when the Fed lends it to banks
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Mar 11, 2016 00:42
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Series DD Funding posted:The money exists, gets deposited in the bank, then gets lent out by the bank. The closest money comes to being created from nothing is when the Fed lends it to banks The money exists from the central bank, say for instance as a $100 bill, and it is deposited in the bank. What a depositor gets for depositing the money is not the $100 bill sitting in a drawer somewhere inside the bank, it is a demand deposit credit that functions exactly like actual central bank money - it can be spent on a check or debit card, transferred to your credit card company, or you can go back to the bank and ask for another $100. The $100 bill you deposited can be loaned to another customer, in which case you look at your checking account balance and say, "ah, I have $100" and the person who took the loan looks at the $100 in her hand and says, "ah, I have $100", and the money supply (specifically M1) is now $200 of perfectly spendable money. The bank is required to keep some (small) fractional reserve of all deposits in actual central bank money to satisfy the requests of customers to redeem their deposit credits for central bank cash. The actual cash transactions are even unnecessary as the bank can borrow a deposit credit from the federal reserve and then you could take a loan directly in the form of a deposit to your account, a credit card payment to a merchant, a bank check, or a balance transfer issued to a third party. BEHOLD: MY CAPE fucked around with this message at 03:07 on Mar 11, 2016 |
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Mar 11, 2016 03:03
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BEHOLD: MY CAPE posted:The $100 bill you deposited can be loaned to another customer, in which case you look at your checking account balance and say, "ah, I have $100" and the person who took the loan looks at the $100 in her hand and says, "ah, I have $100", and the money supply (specifically M1) is now $200 of perfectly spendable money.
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Mar 11, 2016 13:35
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The bank has an asset with an expected value, the other guy has a liability with an expected loss. No one made anything up.
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Mar 11, 2016 17:07
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Jeffrey of YOSPOS posted:The bank has an asset with an expected value, the other guy has a liability with an expected loss. No one made anything up. The balance sheets work out, but the credit the bank created is now a negotiable asset (i.e. money) that didn't exist before. The two customers could walk out the door together and around the block and both spend their $100 on a nice dinner and the merchant would gladly accept the $200 half in cash, half on a debit card or whatever, even though half of that money did not exist an hour ago and the government didn't issue it in any way. In fact, money issued by private banks and merchants predates central bank currency, and the U.S. economy went through multiple periods without a central bank.
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Mar 11, 2016 19:03
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Sequencing diagrams are useful to understand how the money gets made up. Our actors are Dwight, Behold, and Bank. Bank operates on a 9:1 fractional reserve; for every $1 of deposits they are allowed to issue $9 in loans. T1: Bank is operating at exactly their fractional reserve requirements, if they issued more loans they would be in violation of their reserve requirements. T2: Dwight deposits $100 at Bank, then goes into the bathroom to masturbate furiously. T3: Behold shows up with excellent credit, applies for a a $900 loan, is approved on the spot, walks out with $900 cash, buys $900 worth of cocaine. T4: Dwight walks out of bathroom, goes up to teller with cum-stinking hand, asks to withdraw his $100, is informed that they're not honoring deposits and to come back later because they have to meet their reserve requirements. Compared to time T1, the bank has an additional $100 in liabilities (Dwight's deposit), and $900 in assets (Behold's loan). The bank's balance sheet has increased $800, but that $800 did not correspond to some other entity executing a transaction to give that bank the $800 dollars. The bank made those $800 up.
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Mar 11, 2016 19:24
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Dwight Eisenhower posted:Sequencing diagrams are useful to understand how the money gets made up. Our actors are Dwight, Behold, and Bank. Bank operates on a 9:1 fractional reserve; for every $1 of deposits they are allowed to issue $9 in loans. Wow, you really don't understand how fractional reserve banking works. With a 10% reserve ratio, that means they have to hold in reserve 10% of all obligations (i.e. deposits). So in your example is $100 is deposited in the bank, then they have to keep at $10 in reserves. Which means they could loan out $90 (not $900) based on that $100 deposit.
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Mar 11, 2016 19:30
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His story was funny none-the-less.
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Mar 11, 2016 19:42
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danielski posted:Wow, you really don't understand how fractional reserve banking works. And for those who haven't passed a basic Econ 101 class, the gold bug concern about fractional reserve banking is through the money multiplier effect whereby that $90 loan gets deposited in the same or a different bank which means that $81 dollars gets loaned to someone else. That someone else deposits that $81 to a bank which then loans out $73 dollars, etc. Basic college math tells us that a reserve ratio of 10% leads to a 10x factor on the money supply spread across each of those transactions. As opposed to the 9:1 example where a "9:1" reserve ratio would lead to an infinite money supply.
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Mar 11, 2016 19:44
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Dwight Eisenhower posted:Sequencing diagrams are useful to understand how the money gets made up. Our actors are Dwight, Behold, and Bank. Bank operates on a 9:1 fractional reserve; for every $1 of deposits they are allowed to issue $9 in loans.
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Mar 11, 2016 20:04
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The moral of the story is to masturbate furiously prior to handing over your $100.
Devian666 fucked around with this message at 03:06 on Mar 12, 2016 |
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Mar 11, 2016 22:36
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Business, Finance, and Careers › Financial Independence: Banking Fractionally, Masturbating Furiously
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Mar 12, 2016 00:58
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danielski posted:Wow, you really don't understand how fractional reserve banking works. Lol
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Mar 12, 2016 10:49
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danielski posted:Wow, you really don't understand how fractional reserve banking works. lol look up money multiplier
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Mar 12, 2016 16:18
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shrike82 posted:lol look up money multiplier The guy you quoted explained the money multiplier effect like 5 posts up. Are you retarded?
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Mar 12, 2016 16:54
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Dwight Eisenhower posted:T4: Dwight walks out of bathroom, goes up to teller with cum-stinking hand, asks to withdraw his $100, is informed that they're not honoring deposits and to come back later because they have to meet their reserve requirements. Nah, the bank just borrows from the Fed. https://www.newyorkfed.org/aboutthefed/fedpoint/fed18.html
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Mar 14, 2016 05:37
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I noticed mint is now sending out snail mail loan invites. Yes Mint, I need a 4000 dollar loan?
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Mar 15, 2016 02:28
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TLG James posted:I noticed mint is now sending out snail mail loan invites. Yes Mint, I need a 4000 dollar loan? I got one of these too, and I'm mildly annoyed by it. But not necessarily for sending me junk mail. I'm annoyed that they send me such irrelevant drivel when they have many years worth of my financial accounts' balances, credit score, and assets vs. debts. They should be able to profile me well enough to know that no, I don't need some lovely unsolicited loan. Step up your game, Intuit, god drat.
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Mar 15, 2016 03:04
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That's basically how I feel about Mint's advertising in general. No I really don't need a balance transfer, I don't need yet another brokerage... YNAB is worth $5/mo just so that I don't see ads, as far as I'm concerned.
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Mar 15, 2016 20:39
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YNAB classic for life. Down with monthly fees!
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Mar 15, 2016 22:32
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Dessert Rose posted:$5/mo
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Mar 15, 2016 22:36
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IDK if anyone used Toshl, but they forced a piss garbage new UI/tagging system around New Years that has caused me to quit using it entirely, after a year of pretty religious expense tracking. I think when I checked YNAB it was something like "make a monthly budget", but that really doesn't work for my needs. Can anyone recommend a simple expense tracker with customisable (but not mandatory) categories, that easily lets you view expenses within a custom date range (a week, in my case), and can generate nice-looking graphs? Pompous Rhombus fucked around with this message at 22:44 on Mar 15, 2016 |
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Mar 15, 2016 22:39
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TLG James posted:I noticed mint is now sending out snail mail loan invites. Yes Mint, I need a 4000 dollar loan? I was super annoyed to receive one of these since I deleted my Mint account about 4 months ago.
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Mar 15, 2016 22:39
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Blinky2099 posted:Wrong thread. Fine $50/yr. :p The space in my brain and irritation ads cause/occupy is in fact worth that money to me. Also I couldn't get into classic, something about having to manually reconcile across multiple sites. But Mint always annoyed me for a couple reasons - first, it displays budgets as progress bars, which is just not really a helpful representation of my budget. And second, it has extreme difficulty with concepts like "I want this budget to reach $x surplus by Y date but I will also be spending some of the budgeted money before then", which seems like a very simple thing to do. Also you have to manually set all your budgets to roll over every month or money you didn't spend just evaporates. And if you do that, you can't move money that rolled over from a previous month without just clearing that category. YNAB is worth the yearly fee to me and I'm happy to support development on a product that will easily save me more than it costs every year.
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Mar 15, 2016 23:30
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This is going to be a bit of an EN post, but there aren't many people you can talk to about FI and saving, and I just need to vent a bit. Been struggling to remain within budget for our FI goals. We are running a pretty lean budget, and the fiance and I have both approved said budget, but she consistently has trouble staying with in it, or late in the month will get grumpy with me about how "we aren't allowed to spend any money ever". Main obstacles are her eating out at work (not planning or preparing lunch ahead of time, which I always do), and wanting to spend money on the house in terms of decorating. Our personal spending money is fairly lean for our income at $150 each per month (or maybe that isn't?). We've agreed that eating out comes out of this budget line, so she uses a lot of her spending money on eating out when I'm not, and she ends up feeling cash strapped at the end of the month. Our FI goals at this time are basically maxing out both our tax sheltered accounts, so 401k and Roth IRA. We are doing catch up on Roth right now as we have never had IRAs. We just maxed out our 2015, and are aggressively saving for 2016 and 2017 with the goal of having the full $11,000 for 2017 on Jan 1st. Once we hit that goal, the plan is to up our 401k to max, while still maxing out the Roth going forward. We make just enough to be able to do this while running a lean budget. I feel really good that we are making great progress towards FI, but I also feel the pinch of restrained budgeting as I've never quite gone this lean, but not nearly as much as her. I can pretty comfortably live within this budget as I have a lot of inexpensive hobbies, and I've been using a legit budget myself for about 5 years, while she has only first started using a real budget about 6 months ago. It's probably just growing pains and I should allow some slack. This is a marathon and not a sprint after all. Conditioning is very important. I'm predicting some decent income growth for us in the next few years in the realm of 10-40%, which would greatly alleviate these budget "problems". Our current plan for FI doesn't include increase in income beyond matching inflation, but we also plan to have a kid or two in 3-5 years, so I'm betting on us getting pay increases to cover the added expenses of children and not affect our FI savings. At the end of the day we are pretty much on track, but she isn't in the same mindset of me on terms of need vs want for spending. The worst example is that she wants a new bedroom set as we are using mine from before we met and it is too manly. But to me, all the furniture is perfectly fine, and it is just an aesthetics thing. I have no desire to go drop a couple thousand dollars just to change how our perfectly functional bedroom looks. It's not even super bad, the stuff we have is decent quality, but it isn't feminine enough for her. I've so far been able to win that battle by urging her to decorate the room around the furniture to bring it to an acceptable level for her. I'm much more willing to concede to spending $300 on room decorations than $2,000 on new furniture. So that's where we are currently headed, but again, none of those decorations are budgeted for, and I can't reasonably force her to use her spending money on that without another conversation about how we 'aren't allowed to spend money'. This post is all over the place, but I feel much better getting it out! Loan Dusty Road fucked around with this message at 22:28 on Apr 3, 2016 |
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Apr 3, 2016 22:24
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It does sound like you are actually talking about all these things and coming up with reasonable compromises. There's bound to be some disagreement, but it's worth looking at what spending will decrease some of the stress. Although given that there's a plan for a child and going from dual income to single income is worth saving hard for.
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Apr 3, 2016 23:19
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You could...budget for a new bedroom set? Just add a few hundred every month and it will be your xmas gift to yourselves.
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Apr 4, 2016 03:16
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When you make your lunch for the day why can't you just make 2 lunches instead of one? Maybe switch off so she makes lunch for you some days also. That would apply some pressure since it's much harder to leave you lunchless. Eventually the habit will form and the lunch spending problem will be no more. The bedframe; are you two handy at all? And do you have access to tools or own a belt sander? Maybe hit up instructables and look for an easy diy way to transform your bedframe into the perfect pinterest princess palace. I'm sure even just repainting/vanishing would suffice. Just don't let her gently caress it up too bad or you may be buying a new one lol. If your trying to be an ultra cheapskate then consider spending time- instead of money, to satisfy her decor demands. You'd be amazed what you can do with access to a thrift shop and a sewing machine. Option b: sever from that gold digger. 
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Apr 4, 2016 03:24
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You could also redirect her from buying a new bedroom set and discuss buying used or from a discount venue. When it comes to replacing furniture there's no rush outside of bedbugs. You guys can hit garage sales/craigslist/auctions/estate sales/flea markets and probably find full sets of amazing quality items for under $1000. You just won't find it right away and you'll have to scan for a while.
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Apr 4, 2016 05:41
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Why is your personal spending money fairly lean for your income? Just because of financial independence? Is that as much a goal for her as it is for you? Also, when my wife and I used to keep a strict budget, she had a larger blow fund than I did because her hobbies were more expensive. It doesn't necessarily have to be equal as long as you're both okay with it.
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Apr 4, 2016 05:47
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