
Income, Poverty and Health Insurance Coverage in the United States: 2016 - 11thEarlOfMar
https://www.census.gov/newsroom/press-releases/2017/income-povery.html
======
electrograv
How is "all time high" income surprising, given that inflation essentially
guarantees perpetually increasing dollar amounts of everything?

~~~
jdavis703
The increase is measured in "real terms" which means things like CPI are taken
in to account. Further this number does decrease, for example during the last
recession, so household median income is not directly correlated with
inflation -- especially in this era of low inflation (compared to the mid-to-
late 20th century inflation) that we've been in for a while.

~~~
alexasmyths
" which means things like CPI are taken in to account."

Yes - but we should all be weary of this.

CPI is measured in funky ways, and it's tough one.

Problems with measures:

\+ Both housing and Oil prices are usually left out of the numbers they use
(included in others).

There are reasons for doing this, but it's bazonkers crazy to think of
'consumer prices' as not including their #1 item (housing) and a huge variable
cost that consumers pay for directly (gas) but also that goes into everything
(airline tickets, transport of stuff, taxi, etc. etc..)

And of course the hardest thing to measure is the real value increase of a
product ... i.e. a tomato that is bigger, redder, juicier, healthier - is
worth more than one that is not. So - if prices for tomatoes stay flat - but -
their value has actually increased, well, that's deflation. That intangible is
super hard to measure and quantify.

It's the later issue that is at the heart of so many economic arguments: some
say we are 'poorer than ever' \- and yet, every single bit of material
consumable is way better than it ever was. The crappiest Peugot today drives
better than the #1 Mercedes from 1985 ...

~~~
lotharbot
"core" CPI includes housing.

This is funky for another reason: people don't live in similar housing to what
people lived in in the past. If you look at census data (American Housing
Survey) from 40-50 years ago, you find the average American home was under
1500 square feet, 2-3 bedrooms, 1-2 bathrooms, no AC, no laundry machines, and
so on. In fact, the average American home in the 1970s was smaller and had
less amenities than the average current American home _for people below the
poverty line_.

Any measure that just looks at the change in housing _costs_ and doesn't
adjust for the _benefits_ of on-average larger homes with more amenities will
end up overestimating that piece of monetary inflation (accidentally counting
lifestyle inflation.) As you say, it's really hard to measure the "real value
increase of a product", and that makes a lot of inflation measures... sketchy.

~~~
maxxxxx
If only we could buy 1000 square foot houses in expensive areas. They don't
get built anymore.

~~~
lotharbot
yeah, building and zoning are certainly relevant considerations. I'm not
saying "this is all the fault of consumers". More like "when we measure
inflation, we conflate monetary and lifestyle inflation, and our preferred
policy ideas might not reflect that."

------
alistproducer2
For context, the survey covers 2015-16. The gains are from the last
administration.

~~~
vacri
The first year of someone's term is very rarely affected by their policies. My
particular pet hate is when politicians start bragging about how their
policies are responsible for good economic news when they're still in the
first three months.

Truth is that economies change slowly, and politicians have much less control
over it than we all like to believe.

~~~
rdtsc
I think in general you're right, but with a some exceptions. Like say it
depends on what part of economy we are talking about. If inflation, GDP
numbers and so on, then those move slower. But stock market can react pretty
quickly it seems. For example it can react to getting a hint of a possibly
changing regulatory environments. A crashing or rapidly rising stock market
will affect the economy quite a bit, especially if it is sustained long
enough.

War can change things, disasters, foreign economic threats (say a trade war
with a major superpower). Those can have rapid effects as well.

~~~
vacri
Well, disasters and foreign economic threats aren't due to a politician's
policy, and the regulatory environment usually doesn't change straight away
(that requires legislation, not just a policy manifesto). War is a rare event
as well, and it doesn't necessarily affect the wider economy - the war in Iraq
and Afghanistan hasn't affected the US economy much, which quite happily went
through a boom time in the early years of the war, then crashed for reasons
unrelated to the war. Of course, the economy of Iraq got soundly fucked by
war, but that wasn't due to the economic policies of the politician in charge.

~~~
linkregister
The war had enormous implications for the economy. Commodity prices were
driven extremely high due to investor uncertainty about the Middle East oil
supply. It got so bad that Congress had to pressure traders to stop hoarding
massive amounts of crude oil in the hopes that the supply would be disrupted
and the price would escalate. These commodity price rises fueled speculation
into other asset classes, such as housing and loans.

As always there were some short-term positive Keynesian stimulative effects by
increased government spending, but a massive run-up of the deficit did
increase the cost of servicing the national debt, which might otherwise have
been directed into productive enterprises, rather than the wasteful Iraq war
which achieved negative progress.

------
McBlorker
I'm curious: is anyone at a point where they're pulling out of equities at
all? I feel like things are getting a bit too good to be true in the markets.

The Shiller P/E ratio is at a 2nd-time high - the only other higher time being
the dot-com boom and bust: multpl.com/shiller-pe/

~~~
baron816
Trying to time the market is a well known suboptimal strategy. Just leave your
money and try not to worry about it.

~~~
empath75
Unless you’re retiring in the next five years or something like that.

~~~
virmundi
Do you think market will return to this level with your current basket of
equities? There is an argument that the market has too much liquidity due to
QE and low rates within the fractional reserve system. If the market crashes,
will the monetary policy be there to get the market to these highs within 5-10
years?

Also, if you think the market is going down, one doesn’t need perfect timing.
You can get out and have cash on hand to buy later. If everything goes down
25% and you sold out 5% below the max value, you now have more money than your
peers, which started in the market, to get gains in the future.

~~~
refurb
This is true, but nailing that timing is really hard. I can't remember the
exact numbers but if you missed the 10 best days for the market in the last 40
years, you missed out on 70% of the gains.

------
mattbgates
My bank account says, "That was a lie."

~~~
0xbear
Your bank account says “find a better job”. In today’s job market there’s
really no excuse for anyone who can understand at least half the news posted
on this site to make less than six figures.

~~~
HarryHirsch
Tell that to the people on the wrong side of 40.

~~~
0xbear
I’m older than that myself. Doing pretty good.

~~~
chillwaves
If you are 40 and just getting started, how does that feel?

Do you have any capacity for empathy or understanding a life situation that is
not your own?

~~~
0xbear
No. If you can’t find a job as an engineer in this white hot market, it’s time
to think of a career change. That’s the cold, hard truth. Things are crazier
than I’ve seen them in 20 years. Empathy does not motivate. Get off your ass
and strike this iron while it’s hot.

------
zappo2938
What happens when the US needs to start paying off the trillions in debt? I
remember the last time things were good. It stopped being good quite rapidly.
I don't know much about monetary and economic policy but I'm optimistically
cautious. I can't imagine the US borrowing several trillion dollars to keep
credit from freezing again.

~~~
malandrew
My understanding is that most US debt is held by US citizens or US
organizations.

~~~
xiphias
And the Chinese government which is building a massive army for totally
unknown reasons /s

~~~
Clubber
The wonderful thing about owing so much debt is it really makes the financial
incentive for war against you that much lower for your lenders.

------
11thEarlOfMar
Side note: The 5.8% decline in poverty is not explicitly stated. Per the
report, the number of persons in poverty dropped by 2.5 million to 40.6
million. I added the 2.5 million back to 40.6 million to get the 2015 number,
then divided it back into 2.5 million to get the 5.8% YoY decline from 2015 -
2016:

2.5 / (40.6 + 2.5) = 5.8%

------
stevenmays
I wonder why the title of this post got changed from "US Median Household
Income +3.2% to All-Time High..."

~~~
grzm
The title was changed to the actual title of the document. HN discourages
editorializing titles.

> _" …please use the original title, unless it is misleading or linkbait."_

[https://news.ycombinator.com/newsguidelines.html](https://news.ycombinator.com/newsguidelines.html)

------
chiefalchemist
As I understand it, the measurement for poverty is unreasonably low. That the
better rule of thumb is the number of citizens below 2x the traditional
poverty income levels. This data is over-aggregated.

