
The Next Recession Will Destroy Millennials - pseudolus
https://www.theatlantic.com/ideas/archive/2019/08/millennials-are-screwed-recession/596728/
======
claudiulodro
\- Trillions in student loans

\- Billions in rent paid to older generations every year with no hope of
buying a house

\- Earning less than the previous 2 generations were at this age. Less assets
than the previous 2 generations had at this age.

The crux of the article is that another recession will drag these issues into
Millennials' middle age, effectively destroying the American dream for a whole
generation. If the next recession is large enough, I can believe that premise.

~~~
helen___keller
> If the next recession is large enough, I can believe that premise.

The great recession is so named because it is supposed to be much worse than
your average recession - a one-in-a-hundred-years recession. It makes sense
considering how the financial system leveraged itself on toxic assets.

The question is, how confident can we be that we won't have two horrific
recessions in a row? At face value the concept of a "one in a hundred years"
recession seems to imply that this won't happen. But as an individual I
wouldn't say I'm particularly confident that the market is sane.

Interest rates are going down to join the rest of the world in negative
interest rates, despite the states supposedly being in an expansion. Shiller
PE ratios suggest stocks are overpriced similar to pre-recession and pre-
depression highs. The latest batch of IPOs seems full of companies that are
not profitable and may never be profitable and yet your average investor is
now exposed (through e.g. their index funds). A seemingly infinite pool of
capital with nowhere to go props up wildly questionable companies like WeWork.
Real estate values in top cities have blasted off into outer space as this
infinite pool of capital looks for more places to park cash.

Maybe we can add in more ordinary concerns too, like average citizen's debt
rising, corporate debt rising, sovereign debt rising, etc

It's quite possible that the next recession will be of the ordinary variety,
but it's not impossible we will end up with Great Depression 2.0 at some
point. If I were a fiction writer imagining the setup to a next great
depression, I imagine it would look similar to the world today.

~~~
pjbk
As the article mentions, many people really never got out of the last
recession. If we have another one, for them it will be just a continuation of
a large one, making recovery even more difficult that it is now. Lost time,
opportunities, compounded gains and mixing it with less income and higher cost
of living makes it a situation not easy to overcome.

We are still bearing the consequences of the big bail out, forcefully paid by
most of us instead of allowing some events to follow their natural path and
the chance that things eventually balanced out. The artificiality of that
solution has created abnormal behaviors and conditions such as the access to
cheap money and a double standard for financial instruments, like personal vs
institutional debt. Those situations effectively devalue money and allow
arrangements that are very paradoxical from an economic standpoint as you
pointed out.

As it has been mentioned in other comments here, I don't think this is limited
to Millennials. Just by looking at the diversity of the economic statistics
per state in the US you can see it is a more generalized problem. I would not
consider that a complete "economy" has recovered from a recession when the
numbers tell us we have just delayed aftermaths and major factions of it are
still underwater with very bad prognosis.

------
IloveHN84
I fail to understand why every article about millennials is biased with the
American college system. Student loans are something not existing in Europe.
And American salaries (at least in IT) are 3x-4x higher than here.

As millennial myself, the big struggle for us is the expensive housing market
(you cannot but anymore a house in a city without a loan, compared to GenX and
baby boomers), the expensive car market (a medium car, say a VW Golf or
similar, reaches quickly over 25.000 €), the incredibly low wages (Youngs are
earning nothing-to-800€ max)

~~~
hellisothers
Where you live is there an expectation that you could have bought a house
without a loan? In the US buying a home without a loan is virtually unheard of
(outside of wealthy parents giving cash)

------
DebtDeflation
Am I the only one getting tired of all these articles that reify demographic
cohorts created by marketing people ("Millennials", "GenX", etc.) and then
treat them as some sort of monolith? If Millennials are defined as
"individuals born between 1981 and 1997" then you're talking about people
between the ages of 22 (just graduating from university) and 38 (potentially
with over a decade and a half of work experience). That's an incredibly wide
(and arbitrary) age range. You also have diversity in education levels (high
school, undergraduate, graduate) and geography (large metropolitan areas,
smaller regional cities, rural). There are real issues that need to be
addressed - rising income inequality, the cost of higher education, the
healthcare disaster in the US, housing, etc. - but wrapping it in generational
mumbo jumbo distracts from that.

~~~
notfromhere
It's pretty straightforward. The Millenial age cohort is doing worse than all
others before it and the timing of their entry into the job market is placing
many into precarious financial positions.

~~~
DebtDeflation
The millennial age cohort is defined arbitrarily. Why 1981-1997 and not
1980-1996 or 1982-1998 or perhaps a range that's narrower by a few years?

~~~
joenot443
"The Pew Research Center defines millennials as born from 1981 to 1996,
choosing these dates for "key political, economic and social factors",
including the September 11th terrorist attacks, the Great Recession, and the
Internet explosion.[36]"

I wouldn't say it's arbitrary. People who've spent their lives studying the
sociology of generations came up with those ranges.

~~~
FreakLegion
It's arbitrary in the sense that it's not grounded in anything objective or
measurable. This is an old historiographical problem you can find argued about
at length under the heading 'periodization'.

------
cryptozeus
And it will not destroy other non millennials ? Total click bet article just
talking about same thing that we have lots of debt and next crisis will be
tragic and probably bigger than last time. So what ? We have already been
through great depression and now people have way more information to deal with
this. In defense to Millennials , they are under lots of debt but they are
also open to staying at home with parents, working through multiple jobs, get
higher education for better jobs so you know what it will all be fine.

------
Zenbit_UX
Is this an editorial or an article? If this is considered real journalism by
the Atlantic I don't think I'll be clicking on links form them anymore. This
is absolute rubbish and dripping in bias.

~~~
claudiulodro
It's the Ideas section ("ARGUMENTS. ESSAYS. INQUIRIES."), so it's editorial.
Either way, it seems to be well-researched as far as I can tell. What's your
specific gripe with it?

e.g.

> The net worth of your average Millennial household is 40 percent lower than
> for Gen X households in 2001 and 20 percent lower than for Baby Boomers’
> households at the end of the 1980s.

This links to a federal reserve study.

~~~
malandrew
> What's your specific gripe with it?

My specific gripe with it and most articles these days is that it's driving an
agenda, the hallmark of which is the omission of any contradictory evidence.
In the course of their research, they certainly encountered evidence that
contradicted their hypothesis, yet when they went to print all this was
omitted.

If someone is exploring an idea, I like it to at least approximate the
approach of good scientific research paper. Propose a hypothesis, present the
data (supporting or otherwise), have a discussion and then suggest a
conclusion for consideration.

As opposed to find data that supports your hypothesis, throw out all other
data you encountered along the way and since you have a foregone conclusion,
no discussion is necessary.

The other thing I'd like to see if anyone predicting the future to also pen an
alternate piece using scenario planning.

"In my previous essay, I predicted X will happen around year Y. In this essay,
I'm going to imagine that it is year Y and it turns out that my prediction of
X was completely wrong and I will explore all the possible flaws in my
previous essay to determine what went wrong.

This approach forces people to be their own devil's advocate.

~~~
notfromhere
Not every issue has a "both sides". Data is pretty universal in showing that
the millenial cohort is pretty financially precarious

~~~
malvosenior
Do you have a link to that data?

~~~
mdorazio
There were multiple links in the article. 30 seconds on google scholar will
show you as many additional ones as you want, ex. [1][2]. Asking for links
here is not really appropriate.

[1] [https://www.bls.gov/opub/mlr/2014/beyond-bls/millennials-
aft...](https://www.bls.gov/opub/mlr/2014/beyond-bls/millennials-after-the-
great-recession.htm?rel=%22nofollow%22)

[2]
[http://www.frbatlanta.org/documents/pubs/econsouth/14q1.pdf](http://www.frbatlanta.org/documents/pubs/econsouth/14q1.pdf)

