By normal people? I think you are greatly overestimating people's knowledge of economic theory. Most probably only know of trickle down because it's mentioned in the news.
There was a recent article by NYT about the Chase Sapphire Reserve credit card. Look at the comment section, most don't know how to do cost benefit analysis. All they saw was a $450 annual fee. A good amount still talk about paying with cash only.
This doesn't mean I'm much better off. When you mentioned debt super cycles I have no idea what you mean. I'm only starting to get into economic theories. I'm 27, can be considered upper middle income, and given millennial income calculators in top 1% of earnings (not saying much since most people in the valley can get that, ~$70k income for that level). These theories does not have a perceived effect on people's day to day lives. So a lot don't know about them or don't care. Example, every few weeks I see an article in the front page about negotiating salary. This isn't a gauge of knowledge, but of interest. Everyone goes through negotiation situation, value is obvious, more people learn about it.
I read the article [1] because I was dubious about the potential cost/benefit given that I pay zero dollars in interest on my cards (I pay the statement balance every month), and I found that the benefit is for rewards programs.
My understanding is that rewards programs are an arms race: the merchants cover the extra rewards amount. That means that they're bundling the cost of rewards into their products anyhow and charging you for the "pleasure" of getting your money back. If you can get in on it before the costs rise to the full amount of the reward, then other people subsidize your reward by purchasing the cost-adjusted product without getting rewards. I'll pass on paying $450 to further that, no cost-benefit required.
Irony that you did cost benefit on a much broader scale (merchants and consumers as a whole) instead of a personal finance level. And you are right about merchants paying more. Didn't make sense when I was running a store until I read a paper on reward points and transaction fees.
This type of subsidizing happens around us, one that comes to mind is taxes. 401k and other tax shelters. People that are taking the greatest advantage of these have money to spare, and read up on the advantages (or hired someone that has).
Also, since you pay off your statement every month, reward cards make a lot of sense. Haven't seen one that requires a revolving balance. For me it's about optimizing returns on spend I already have.
He's trying to measure himself against the average single person his age. Of course, more realistically according to the Bay Area metric, he is below the household poverty line.
Mixed up my numbers, top 1% for age group ~106k. Bay Area metric I make more than median household, which is scary since that means the average single income family in the Bay Area would be barely scraping by (not hard to believe).
Just because you make more than median doesn't mean you aren't still below the household poverty line. Once you grasp that, you'll begin to understand the completely upside down economy of the Bay Area. Palo Alto considers below 250k/y household low enough to qualify for subsidized housing. The top 1% make $450k and the top 1% in San Francisco make nearly $1m. You are in a crazy context you aren't yet fully realizing.
Not sure what craziness you think I don't perceive. My initial comment is to demonstrate how a person in my generation that is doing relatively well financially, are not versed in the economic concepts the parent comment provided (debt cycle). That it is not normal for us to know such concepts.
There was a recent article by NYT about the Chase Sapphire Reserve credit card. Look at the comment section, most don't know how to do cost benefit analysis. All they saw was a $450 annual fee. A good amount still talk about paying with cash only.
This doesn't mean I'm much better off. When you mentioned debt super cycles I have no idea what you mean. I'm only starting to get into economic theories. I'm 27, can be considered upper middle income, and given millennial income calculators in top 1% of earnings (not saying much since most people in the valley can get that, ~$70k income for that level). These theories does not have a perceived effect on people's day to day lives. So a lot don't know about them or don't care. Example, every few weeks I see an article in the front page about negotiating salary. This isn't a gauge of knowledge, but of interest. Everyone goes through negotiation situation, value is obvious, more people learn about it.