
Coronavirus-afflicted global economy is almost certainly in recession - adelHBN
https://www.wsj.com/articles/coronavirus-afflicted-global-economy-is-almost-certainly-in-recession-11586867402
======
refurb
As per the title, I don’t think now is comparable to 2009.

In 2009, the economy collapsed because of bad loans. In 2020, the economy is
shutting down because we shut it down.

That’s said, our shutdown could certainly snowball into serious issues with
the economy where the pre-existing economic activity doesn’t come back.

~~~
chrissnell
I am quite confident that it will come back. Demand is there. My dad owns a
chain of bicycle stores. Sales have been absolutely through the roof during
quarantine (they are "essential"). Like, blowing-away-previous-sales-records
good. His customers represent all walks of life in the city he serves. He has
stores in the wealthy areas and stores in the poorer areas; all are doing
well. People want to spend money and they are desperate for places to do it. I
predict that we will see a retail boom if we can find a way to reopen the
economy and still be safe (masks everywhere, distancing). The trick is
figuring out that safety. It starts with PPE and cleaning commodities. We need
universal availability of good face masks, hand sanitizer, and effective
cleaning wipes. We need to flood the world with so many masks that you get one
for free every time you walk into a store. Figure that out soon and this
economy will rebound.

~~~
sergers
"People want to spend money and they are desperate for places to do it."

I dont think people are desperate to spend money.

Your dad likely had a upturn in customers due to mass demand for personal
fitness devices.

Due to social distancing, gym closures, anything fitness related for
home/personal use is selling out.

When covid-19 lockdowns loosened, I expect downturns in these areas.

The market will be flooded with people trying to do returns and reselling the
equipment.

~~~
conductr
The uptick of boredom induced outdoor leisure caused by banning social
activity of all kind and an increase of disposable time. Bicycles seem well
positioned to do well in this economy.

~~~
ollifi
Also depending on where you live many people who usually use public
transportation and still have to commute opt for bicycles if that's viable.

~~~
hunter2_
And those who avoided biking in cities due to safety concerns no longer have
so much traffic to dodge.

~~~
FridgeSeal
I can confirm this: whilst I never avoided riding due to traffic before, going
for road rides now is amazing due to there being practically nobody else on
the roads.

------
analog31
Just reading the headline, what this means to me is that the "world economy"
is doing a lot better than most of us are doing as individuals. I'm on a 25%
furlough. Sales from my side business have dropped to zero. My other side job
has dropped to zero. Among working people, I'm one of the lucky. My family
actually has a little bit of money in the kitty.

"The economy" refers to a system that's primarily designed to concentrate and
protect private wealth, and a 3% loss of private wealth isn't all that bad at
all. The people who are really hurting have no wealth to lose.

I hope an outcome of this crisis is that we start to think about "the economy"
in more humane terms.

~~~
missedthecue
"the system" isn't designed to protect wealth so much as encourage
productivity. There is a direct correlation between increases in productivity
and increases in wealth, but a system designed to protect existing wealth
would look much different than ours. For instance, cartels would not be
illegal.

~~~
pmiller2
What do you call it when real wages don’t go up in a system designed to
“encourage productivity?” Since the gains aren’t going to workers at all, they
must be going to those at the top, right? That sounds an awful lot like
“protecting wealth” to me.

~~~
randomdata
Wages stopped increasing when human productivity peaked. The continued gains
in productivity we have seen since that time have come by way of
mechanization/automation. Given that the system encourages productivity, those
who bring that automation to the economy reap the rewards. Those who only
offer their labour to the economy are stuck since labour productivity has
peaked. Humans simply cannot provide more productivity on their own.

As most people only offer labour and only a small group offer the more and
more productivity gains of automation, it is true that the rewards end up
being concentrated in that small group of productivity providing people. "The
top" as you put it. That disparity is meant to incentivize you to develop your
own technologies that increase productivity further instead of "wasting" your
time selling productive-constrained labour, but in the real world it is
unquestionably difficult to recognize where productivity can be gained.

The understanding of that was the basis for the idea behind pushing everyone
into post-secondary schools, with a promise that higher learning would teach
you how find solutions for increasing productivity, and thus increasing your
reward for increasing overall productivity (a.k.a. providing you with a higher
income). However, the real world is again messy and it hasn't really worked
out. Despite a substantial increase in post-secondary attainment in recent
times, the vast majority of graduates are making no more than they would have
without having attended a post-secondary school (wages have been stagnant for
decades upon decades) as they by and large end up only selling their
productivity-limited labour.

~~~
pdonis
_> Humans simply cannot provide more productivity on their own._

Sure they can. Who is designing and building and installing all that
automation?

I know that you recognize this since it's a key point of the rest of your
post. But I don't think you've fully realized the implications. The problem is
not just that post-secondary schools haven't lived up to their promise of
teaching people how to increase overall productivity. The problem is that,
fundamentally, increasing overall productivity is _entrepreneurship_ , and
entrepreneurship is not something that can be taught in schools. It's a
fundamental change in viewpoint: you have to stop thinking of yourself as an
employee, a wage earner, and start thinking of yourself as a business owner.
But schools teach people to be wage earners, and as you quite correctly point
out, there is no real growth to be had at this point in being a wage earner.

~~~
randomdata
> Sure they can. Who is designing and building and installing all that
> automation?

The work of designing, building, and installing remains constrained to the
limits of human productivity. The only way to make those jobs more productive
is to use tools, and, like always, those who control the tools are those who
reap the additional spoils.

------
tempsy
The stock market is basically at late 2019 levels when everything was totally
fine. The disconnect between the market and the economy is quite dystopian.

~~~
robjan
Not really. Currently the economy is in a bad state but this is not permanent.
We expect things to eventually bounce back when we have the virus under
control, and that has been priced into the current valuations. If it wasn't
priced in then now would be a great time to buy which would push the prices up
due to higher demand. When you own a stock, you own it until either you sell
it or the company goes bust. Therefore the price is based on investor belief
about the future, not just the current situation.

~~~
titzer
> the price is based on investor belief about the future

Six milliseconds from now, when the automated trading systems think they can
sell and make a profit.

Seriously, over 50% of trading volume is done by automated trading systems
these days.

edit: looks like I underestimated. This article from June 2019 suggests it may
be as much as 80%: [https://www.cnbc.com/2019/06/28/80percent-of-the-stock-
marke...](https://www.cnbc.com/2019/06/28/80percent-of-the-stock-market-is-
now-on-autopilot.html)

~~~
robjan
That may be the case but I feel you are mixing cause and effect. Trading
algorithms don't cause a company to make more profit and therefore distribute
dividends.

~~~
titzer
And companies didn't suddenly make trillions of dollars in profits in a week
to recover from the bottom of the crash a couple weeks back. The market is
only up right now because the sharks are feeding on the stimulus money created
out of thin air. Automated trading systems are trying to make money _right
now_ , not six months or even a week from now.

~~~
kortilla
I don’t think you understand how valuation works in the stock market. The
prices of the securities are based on what investors think the company will be
doing in 6-12 months, not what it’s doing now.

That’s why in really uncertain times the stock can drastically move without
any of the current financials changing drastically. Everyone knows companies
are shut down now and are bleeding cash, that was why the market quickly
crashed immediately after the shutdown. Now that we’re into the shutdown and
it looks like maybe a re-open by summer, how do the businesses look then?
Especially when they’ve had bailout money to help pay expenses during the
shutdown.

~~~
titzer
> The prices of the securities are based on what investors think the company

That's a quaint view, but the logistics is completely mathematical. The prices
of securities is absolutely and completely based on the bid and offers. It is
a completely mathematical outcome of transactions. Of course, prices feed into
the psychology of investors, as well as their estimates of future performance.
But a huge amount of cash in the market is there to make short-term profits,
not long term profits. Automated systems trade huge amounts of money based off
technical analysis and price prediction on multiple timescales. There are
computer systems with stupid amounts of computational power who only think
about how to make two cents by being ahead of the market by 1 millisecond, 1
second, one day, one week. And they make billions.

> That’s why in really uncertain times the stock can drastically move without
> any of the current financials changing drastically.

I think we're into a rathole here, but this statement basically contradicts
your earlier point. If prices are based off the future 6-12 months from now,
then crashes wouldn't happen, or be so severe. This is obviously false.
Bubbles pop violently.

------
dzdt
Does anyone have an explanation (preferably with source links) for why the US
stock market is not absolutely tanking given the depths of economic
disruption? I mean I get that the government is supplying stimulus, but I
don't see how that can make up for the years of rebuilding that will be ahead
even after we reach the bottom of the current jobs-and-small-business
freefall.

~~~
Danieru
IT DID.

Do not pretend the past 2 months did not happen. You wonder why it "did not
tank" but it DID TANK. It tanked when risks were unknown and everyone with a
calculator could understand that exponential spread could kill large numbers.

Now 2 months later the exponential spread has been controlled. Now 2 months
later those who think the economy is going to disappear have already sold.
Anyone holding stocks now is doing so because they think Coca-Cola is going to
be worth a lot of money over the next 30 years. Short of new and surprising
bad news the market has no reason to price in further uncertainty.

~~~
pbourke
Do you think the market is appropriately pricing risk?

Do you feel the economic outlook and prospects for growth are the same now as
they were in June 2019 when the S&P 500 was at a similar level?

Honestly I think the jury’s out on whether double-digit percentages of the S&P
exist in their current form 2 years from now, even with the US government
interventions.

~~~
starbugs
Agreed. Price discovery feels broken to me. Maybe it is because of the FED
interventions. Infinite is infinite, right?

Perhaps the market is pricing in inflation instead of real growth? Perhaps
it's because there's literally no other way of investing your money right now?

It's really become hard to say. The downturn in the previous weeks seems to be
way too weak given the current circumstances.

------
tempsy
And yet the stock market is basically at late 2019 levels when everything was
totally fine. Incredible how disconnected it is from the economy.

~~~
mikekchar
The S&P 500 average price to earnings ratio is actually only at about 21,
which is not an unusual level for the last 20 years. It's relatively high
compared pre-1990 levels, but in comparison, during the 2009 crisis, the PE
ratios blew through the top. I was actually surprised when I looked at it
because, like you apparently do, I expected prices to be through the roof. As
this crises continues, though, I suspect we'll see it creep up. People are
burning through their limited savings. When that runs out, there will be a
crunch -- I would imagine.

~~~
_delirium
That's a 12-month trailing PE though, which has only a small amount of the
covid disruption baked into it so far. The (unknowable) PE ratio calculated
based on forward earnings might in reality be a lot higher if the "E" part is
tanking (it did in 2008: 2008 S&P earnings were down 75% on 2007).

Analyst estimates for what earnings will look like this year are all over the
place, predicting anything from a 5% to a 40% drop in S&P earnings per share.
If you side with a 5% drop, then the forward PE only rises to about 22. If you
think a 40% drop is a good prediction though, that's looking like a forward PE
of 35.

~~~
tempsy
The market seems to be pricing in a full recovery. Anything less than a return
to normalcy when it comes to demand or unemployment by end of year will send
markets lower than now, I’d imagine...

------
umeshunni
The actual report that this article is based on is here:
[https://www.imf.org/en/Publications/WEO/Issues/2020/04/14/we...](https://www.imf.org/en/Publications/WEO/Issues/2020/04/14/weo-
april-2020)

including the terminology "The Great Lockdown"

------
pdq
Mirror: [http://archive.is/YfPVL](http://archive.is/YfPVL)

~~~
adelHBN
I don't know what Mirror is. But this was so cool. How did you get this? The
WSJ article I posted is behind a paywall.

~~~
rashidujang
Not the original poster, but a mirror in the context of websites usually means
a backup copy of a piece of content that is accessible from another source.

------
anigbrowl
Amazing - how _did_ they figure out that when only everyone has been saying it
for the last month? Besides coronavirus, we were already in a period of anemic
growth masked by the arguably inflated performance of the stock market.
Federal Reserve activity going back to last September or so suggested an
economic overhang.

------
daniel-cussen
As I see it GDP measures national revenue, not national profit. The closest
proxy to national profit has historically been net exports, which is why every
country wanted to export a lot but import very little.

Frankly, if "the economy" falls 0.1% in a Great-Depression (as alluded to by
the current Democratic presidential candidate) scale catastrophe (for
reference, the Great Depression was more believably 25% of GDP) maybe we've
massaged the statistics too far. So frankly, why not just gauge "the economy"
not by GDP but by estimating actual human profits of working, the money they
have left over after rent is paid, food is on the table, and health taken care
of. Further, take into account diminishing marginal utility of surplus income.
How much do people have _left over_ and how does that change over time?

------
UncleOxidant
A 3% contraction seems really optimistic.

~~~
adelHBN
I totally agree.

------
icedchai
3% sounds optimistic.

~~~
adelHBN
You know, that's what I thought too. But then I was seriously surprised when I
saw 0.1% contraction during the Great recession of 2007-2009.

~~~
rogerkirkness
It wasn't a depression in the sense that economic activity mostly continued,
it was a deleveraging. People are overestimating the leverage in play in the
current situation, other than giant public companies, there is less toxic
debt, so it's more about actual economic activity (E.g. trade).

~~~
Consultant32452
What are the odds some of that non-toxic debt turns into toxic debt as
unemployment lingers?

~~~
_delirium
It's definitely possible that real estate (both commercial and residential) is
going to see a bunch of deleveraging as the debt becomes unserviceable. Right
now everything is frozen in place. But once it restarts and everyone is
supposed to get up to speed on their rents and mortgages again, a bunch of
landlords are going to realize they're never getting those _n_ months of back
rent that are officially just temporarily suspended. At that point, the more
leveraged ones are going to end up with cash-flow problems and mortgages going
into default (also currently officially just temporarily suspended). I won't
venture a guess on how widespread that's likely to be though.

------
nl
Does anyone know what the "3% contraction" is actually referring to? The IMF
report[1] it is based on says GDP, but world GDP contracted 1.9% during the
great recession[2], so that doesn't make much sense.

Also, looking at their calculations they have "advanced economies" (basically
US, Europe, UK, Japan etc) forecast to contract 6.1%, India expand 1.2% and
China 1.0%, ASEAN expans 1.9% and everything else shrink. That can't possibly
make a 3% contraction (if 2/3rds of the world's economy shrinks 6%, then 1/3rd
can't make it up by expanding 1.5%!).

[1]
[https://www.imf.org/en/Publications/WEO/Issues/2020/04/14/we...](https://www.imf.org/en/Publications/WEO/Issues/2020/04/14/weo-
april-2020)

[2]
[https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2...](https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2009&locations=1W&start=2005)

~~~
AnimalMuppet
GDP is what the economy produces. Well then, if you shut everything down for a
month, you expect to lose 8% of GDP, because you're not producing during that
month. If you shut it down for two months, you expect to lose 16% of GDP.

Losing only 3% is pretty good, actually.

~~~
nl
Yes, I understand that. My point is how can it possibly be only 3%! Their own
math doesn't add up!

------
zmmmmm
It will be an interesting test to see what happens after things return to
"normal".

Real economic downturns happen because deep structural issues have developed
in the economy that cannot be dealth with other than by broad scale cyclical
restructuring. But in this case there is not an underlying structural issue -
everything was "fine" and then an externality prevented normal productivity.
So in one theory of things, once the lockdowns are over people will mostly go
back to doing what they were doing before and apart for some one-off bad
debts, etc life will just resume. In another theory, economic downturns are
like self-fulfilling prophecies and once started will take many years to work
out.

It will be interesting to see which one of these happens.

~~~
HSO
Things were _far_ from "normal" before.

This is still the same crisis that started in 2007.

~~~
anm89
And the same bubble that started with dot com boom collapse which Greenspan
reinflated into the housing crisis

------
ForrestN
I was surprised by this article:

[https://www.nytimes.com/2020/03/26/opinion/covid-economy-
une...](https://www.nytimes.com/2020/03/26/opinion/covid-economy-unemployment-
europe.html)

------
atum47
you know what? things are kinda bad right now, I even lost my job but I'm
still hopeful. Hopeful that this "thing" will end and we as humans will grow
from that bad experience.

------
mark_l_watson
I think the 3% refers mostly to the effect on large corporations, and I think
that number is low, even understanding that most government bailouts are going
to the financial industries and mega corporations.

I think that number is very low when talking about regular people, their
purchasing power and what I predict to be a large drop in discretionary
spending.

------
neonate
[https://archive.md/mjbka](https://archive.md/mjbka)

------
third_I
Like predictions mean anything right now.

We have 4 months of real-world experience with the threat but we're supposed
to project what 1 year of it looks like. We're not even done with the very
first phase.

Color me skeptical.

Such hubris is vain at best and dangerous at worst in times like these.

------
Kiro
3% is massive. You can't just compare it with other things contracting 3%,
thinking it doesn't sound like a big deal. The effects of each 0.1% the world
economy contracts will shift whole industries.

------
bravoetch
Is there a reason we think this is even a good metric to strive for?

------
known
I believe
[https://en.wikipedia.org/wiki/Chiemgauer](https://en.wikipedia.org/wiki/Chiemgauer)
is the Cure

------
onetimemanytime
OK, I officially do not get economics. Close to everything has stopped for 2
months, lots of lost jobs and econ goes down only 3%?

If I lose 3% in my worst year, I'd be jumping from joy.

------
yalogin
How does this gel with the current stock market surge in the US?

~~~
AnimalMuppet
The stock market "surge" has left it 20% below where it was two months ago.

~~~
yalogin
Oh come on. You know I am talking about the surge in that’s couple weeks.

~~~
AnimalMuppet
Sure. And if that had happened two months ago, I would have thought that it
signaled good times, too. But in the context of when it happened, the recent
run-up looks more like "things aren't going to be as bad as we thought" rather
than "things are good".

------
yters
How does this translate into human deaths? Does that amount outweigh the
potential human deaths adverted by causing the economic downfall through
worldwide lockdowns in response to covid-19?

------
kart23
Start buying stock.

~~~
adelHBN
No! It's too soon. Stocks will go down again. They went down in the 30s and
also during 2007-2009. The first dip was not the final dip.

~~~
warent
It sounds like you're trying to time the market... Stocks are down and as long
as the market exists they will recover. Going long now is a guaranteed profit

~~~
gh54h54ehe4a
Bad financial advice. Nikkei 255 was 25,000 in 1991, it has never hit that ATH
in the 30 years since

~~~
Der_Einzige
Japan's xenophobia is so strong that they don't care about doing what they
need to to get back on top (embrace immigration). The USA may be headed in
that direction but we are no where near the shitstorm of demographics and
xenophobia that Japan is dealing with.

~~~
dntbnmpls
> Japan's xenophobia is so strong that they don't care about doing what they
> need to to get back on top (embrace immigration).

This old argument gets so tiresome. And then what? After they import 10
million people and then they stagnate again, do they have to import 20 million
people?

If the economic system depends on immigration, then there is something
terrible wrong with the economic system and it needs to change.

> The USA may be headed in that direction but we are no where near the
> shitstorm of demographics and xenophobia that Japan is dealing with.

Nonsense. We are all xenophobic. It's human nature. Maybe we are better at
hiding it now than japan, but that's probably not a good thing when you think
about it. In times of crisis, japan is going to be better off as a homogenous
and united population has proven to be far more stable than those with
racial/ethnic/religion divisions/tensions.

------
all_blue_chucks
Travel, hospitality, and events are something like 20% of the US economy. That
20% will be crushed until we have a vaccine next year at the earliest.

I am deeply suspicious of this prediction.

------
lalaland1125
In case anyone is having issues with the paywall,
[https://github.com/iamadamdev/bypass-paywalls-
firefox](https://github.com/iamadamdev/bypass-paywalls-firefox) seems to work
well for me.

(Note: I am not affiliated in any way with that extension. I'm just a happy
user.)

~~~
SimeVidas
Is the extension not hosted on Mozilla’s website?

------
cletus
I still think there's way too much naive optimism out there that things will
all be back to normal a month or two from now. I found this [1] deeply
fascinating. Some highlights:

\- Corporate earnings have been pretty much flat since 2014 (this one in
particularly surprised me). So the last 5 years has been a disconnect between
earnings and valuation and that always comes crashing back to earth at some
point, Covid-19 was just the spark.

\- The demand for US dollars will likely devastate some developing nations
(who borrow in US dollars) with all that entails;

\- The US is in a fiscally weak position;

\- Because of the strong dollar and huge deficit the US essentially has to
print money to buy its own bonds. A real (rather than nominal) devaluation in
US government debt is not out of the question;

On the Covid-19 front:

\- Making a vaccine takes time. Proving it works and is safe takes time. Even
after you've done all that you have to manufacture it somehow. This is a
nontrivial problem. For the flu vaccine the US government actually pays
billions to grow eggs for this purpose [2]. This is unsatisfactory in many
ways and there has been a long search for an alternative but so far to no
avail. Influenza viruses reproduce in chicken eggs. Coronaviruses do not.

\- It will take time--possibly _years_ \--for spending to return to previous
levels. We have examples of this already with the SARS and MERS outbreaks in
Hong Kong and South Korea where spending took 6 and 12 months respectively to
return to previous levels [3].

\- Some industries will take years to recover. Cruise lines are an obvious one
but airlines, hotels and tourism are in the same boat (at least it's not the
Diamond Princess). I wouldn't be surprised if a lot of frequent flyer miles
just evaporate or getting hugely devalued;

\- Some businesses just won't come back. Those businesses spend money. They
paid employees who spend money. All that money went to other people and
businesses who then spend money.

\- Social distancing may be here for the long term [4].

\- My own belief is that the protracted response to this is there will be some
permanent changes in behaviour. This will create new opportunities but also
devastate some sectors.

For some reason, share buybacks are the latest bogeyman and I really don't
understand why. They're just another form of dividend (ie returning money to
shareholders). Borrowing money at low interest for share buybacks is just a
tax deferment strategy (one that I don't think should exist but it does).

There's still significant market and economic downside potential and at best I
think we'll have stagnant growth for several years.

The problem here is that many people now have no memory of what an actual
recession looks like. Even the GFC was quite localized (but of course
devastating to many).

[1]: [https://www.lynalden.com/global-dollar-short-
squeeze/](https://www.lynalden.com/global-dollar-short-squeeze/)

[2]: [https://edition.cnn.com/2020/03/27/health/chicken-egg-flu-
va...](https://edition.cnn.com/2020/03/27/health/chicken-egg-flu-vaccine-intl-
hnk-scli/index.html)

[3]: [https://www.abc.net.au/news/2020-04-14/retailers-warned-
not-...](https://www.abc.net.au/news/2020-04-14/retailers-warned-not-to-
expect-post-coronavirus-spending-bounce/12144354)

[4]: [https://edition.cnn.com/2020/04/14/health/social-
distancing-...](https://edition.cnn.com/2020/04/14/health/social-distancing-
research-coronavirus-2022-trnd/index.html)

------
jsf01
Does anyone have a non-paywalled mirror?

~~~
adelHBN
Oh, sorry. Are you referring to the fact that this is a WSJ article and it's
not free to viewing? If I find a free article with similar info I'll post
that.

------
aktuel
duh

------
flashman
communism baby

3% is nothing if shared equally

~~~
dang
Please don't do this here.

------
elchief
Well, if COVID's R0 is 5.7, then herd immunity is 82%, which we could hit
before there's a vaccine. Death rate is 3.4%, according to WHO (which is
absurdly low in my mind), then population would drop by 2.8%, meaning GDP
would drop by the same...assuming those that die spent an average amount of
money

------
projektfu
If the WSJ wants me to show some concern, they should eliminate the paywall on
certain articles. I don’t care that the large amount of their content is
paywalled, but if they want me to read their opinions, they can’t hide them.

~~~
realtalk_sp
This works well and is worth installing:
[https://github.com/iamadamdev/bypass-paywalls-
chrome](https://github.com/iamadamdev/bypass-paywalls-chrome)

------
xwdv
It is easier to make a fast fortune when the economy contracts compared to
when it expands, if you have prepared properly.

~~~
jimmaswell
The giant vacuum of shuttered businesses should make an easy opportunity to
start or expand business after the pandemic, right?

~~~
gbear605
You can do that only if you have the excess savings to do so, since you'll
have very tough luck getting a decent loan in a bad economy.

------
zuhayeer
Just gonna leave this here:
[https://twitter.com/eladgil/status/1250530780666671105?s=21](https://twitter.com/eladgil/status/1250530780666671105?s=21)

------
adelHBN
One of the issues of such a contraction is its impact on stocks. People often
think it's just for the rich. It's not! Think of all the teachers,
firefighters, nurses, police - all those first responders whose pensions are
invested in stocks. Such contraction will terrible for their eggnests.

~~~
raincom
"A whopping 84 percent of all stocks owned by Americans belong to the
wealthiest 10 percent of households"[1]

"37 percent held by retirement accounts" [2]

Politicians and the wealthy use that poor schmuck's 401k to bail out the
wealthy.

[1]
[https://www.nytimes.com/2018/02/08/business/economy/stocks-e...](https://www.nytimes.com/2018/02/08/business/economy/stocks-
economy.html) [2] [https://www.taxpolicycenter.org/taxvox/only-about-one-
quarte...](https://www.taxpolicycenter.org/taxvox/only-about-one-quarter-
corporate-stock-owned-taxable-shareholders)

~~~
esoterica
A cop married to a nurse could easily belong to the top 10% of households, so
you're not exactly contradicting the parent post.

~~~
raincom
Yes and No. Yes, if the top 10% of households is called "working class".

If a cop and nurse family is the representative of working class, yes, use the
people in the service sector (restaurants, gig workers, contractors, etc) to
bail out the govt fat cats.

~~~
dragonwriter
> Yes, if the top 10% of households is called "working class".

The working class (proletariat), especially the proletarian intelligentsia,
overlaps with the top 10%. “Working class” is an economic relationship,
surviving principally through selling labor, rather than through a balanced
mixture of capital and labor (“middle class" or _petit bourgeoisie_ ) or
principally through returns on capital (capitalist class, or *haut
bourgeoisie).

But a cop and a nurse on average would make about $130k (round figures, $55k
for the cop and 75k for the nurse), 90th percentile household income is about
$185k, so while it's possible for a cop/nurse couple to reach it, it's not
remotely typical for even that couple.

