What happens when the majority of households can't save

[alani123]

It used to be that while wages would never get someone rich at least it was possible to eventually buy some property after years of work. Be it at least a house. A house doesn't have any productive capabilities, it's just a roof by pure material standards.

Then the years turned into decades. We've now though reached a point where most people can't save anything.
New stats in Greece show nearly 90% of households can't even save a single euro after the monthly expenses.

What is the result of that? The people are now more than ever liquidating family owned property and businesses to just sustain themselves. Which turns out to be catastrophic for property ownership because it gets very centralised. Banks repossess properties en masse and foreign investors scoop it up also en masse. Locals end up opening less and less of their country's land every year.

What would a people first government do in this case? Create social housing in order to lower market prices and make it more affordable? Mandate higher wages? Create more housing by giving more permits?

No. We just see inaction. And this inaction of course only helps the large owners.

[EL MOHA]

What would a people first government do in this case? Create social housing in order to lower market prices and make it more affordable? Mandate higher wages? Create more housing by giving more permits?

Only one thing can actually solve the whole problem together but the government will never ever tackle that problem because it’s what they use to control the citizens. It’s Inflation, Inflation is simply what is causing all of this problems because the price of things like building materials are increasing while the money that the intending builder receives is also not having enough purchasing power to cover for basic needs as well as havinv some remaining for savings.

How can someone save when they can barely eat, you will see the goods and services going 3x or more and at the end of the day you see the government actually saying they increase the wages or salary of the citizens by 50%, how does this actually balances up. A family can be spending just $80 from the total $100 earning of the family and then struggle to save $10 or $20 for a house which actually can get built with $1k in the past only for the inflation to come and the price of basic goods to buy actually increases to maybe above $200 for the family, how can they save up when they are feeding from hand to mouth? I doubt and that’s the reality of life currently

[NewStakes]

In the US we have lack of savings combined with historically very high cost of housing, so a primary result is a dramatic increase in the estimated number of homeless people. We might be "the wealthiest country" but many, many people are getting left behind now.

[STT]

Greece has a hard time of course, I would argue the debt accumulated should have been defaulted on as that is a reset but it was in Euros and it didnt go down like that.   So the only other path to get back to zero is repay that debt, I think that means Greece has to avoid imports and reduce costs to service the debt and so accumulate some positive balance.

Problem is Im not even sure the Euro or by extension the EU carries on long term, does it do the most good for all parties across such a diverse region, not a small area by population;  obviously many different governments and people seems to create an unnecessary problem.

  It might be reset happens whether its wanted by those pro EU or not, as said if people hard working cant make an honest living what else can be expected in conclusion.  IMO reset is a positive action to steer correct capital allocation and it will happen occasionally in a proper working economy; not all debts are good.

[jossiel]

A house doesn't have any productive capabilities, it's just a roof by pure material standards.

A house is the structure itself but you call it home and that's the productive capability that it can do.

Where you can set memories of a life time to remember, happy and bad moments that are shared inside of it by the family you built.

What would a people first government do in this case? Create social housing in order to lower market prices and make it more affordable? Mandate higher wages? Create more housing by giving more permits?

No. We just see inaction. And this inaction of course only helps the large owners.

The housing that they create is not even friendly to the regular workers. This is what we see now, more people prefer to rent because they know that even after acquiring a house, paying for its mortgage all of your life time.

You'll be subjected to the taxes that shows that your house isn't entirely yours. It's like a privilege given by the government and you're still renting on them but just have a title that can called it yours.

[HONDACD125]

That is slowly becoming a global problem, I believe, because the situation in my country is almost the same. People work so hard only to make enough money to get through the month, and sometimes even less, which then makes them borrow money from others to sustain their livelihood. If someone is always indebted to others, how on earth can they save any money? Wages stay the same forever, but inflation keeps rising, which creates more problems because you are getting the same salary, but the prices of goods and services keep increasing over time.

A house is a very big thing, in my opinion, you can't even buy a vehicle by saving money these days, this is the reason why most people use public transport systems and for this reason public transports are always busy in most of the countries. I also wonder whether someone can actually be able to buy a house through savings these days, because if they start saving today, they might have a good amount after a decade, but after that much time, the prices will again be higher, so they still won't be able to get anything good with it.

[Spaceman1000$]

It used to be that while wages would never get someone rich at least it was possible to eventually buy some property after years of work. Be it at least a house. A house doesn't have any productive capabilities, it's just a roof by pure material standards.

Then the years turned into decades. We've now though reached a point where most people can't save anything.
New stats in Greece show nearly 90% of households can't even save a single euro after the monthly expenses.

What is the result of that? The people are now more than ever liquidating family owned property and businesses to just sustain themselves. Which turns out to be catastrophic for property ownership because it gets very centralised. Banks repossess properties en masse and foreign investors scoop it up also en masse. Locals end up opening less and less of their country's land every year.

What would a people first government do in this case? Create social housing in order to lower market prices and make it more affordable? Mandate higher wages? Create more housing by giving more permits?

No. We just see inaction. And this inaction of course only helps the large owners.

If things gets to this point, the ideal thing for government to do is to create housing scheme for people at a lower price, they shouldn't allow real estate to get in, else the prices will be off the roof, because those people are purely business men who don't see things without biasness as they are money mongers. However if an economy is facing such kind of existential threat where households cannot save, then government also need to step in, stepping in not to increase wages but create an avenue for more production, this will make items to be readily available and crash down prices. But if the government chooses to increase wages, then inflation will be in double figures.

[crwth]

I was listening to a podcast recently, and it's somewhat related to this. The economy is really changing, and people are much poorer than before. ^{depending on what we are talking about, if it's per capita or any other metric}

From what I found here ^[1], it seems that the majority are 50+ in Greece, indicating an aging population. This could lead to a shrinking working-age population, less money in the economy, and a need for people to use money; hence, the can't save part of this.

There are other factors, for sure, but this is what came to mind first.


[1] - https://www.populationpyramid.net/greece/2026/

[rangga28]

That is slowly becoming a global problem, I believe, because the situation in my country is almost the same. People work so hard only to make enough money to get through the month, and sometimes even less, which then makes them borrow money from others to sustain their livelihood. If someone is always indebted to others, how on earth can they save any money? Wages stay the same forever, but inflation keeps rising, which creates more problems because you are getting the same salary, but the prices of goods and services keep increasing over time.

A house is a very big thing, in my opinion, you can't even buy a vehicle by saving money these days, this is the reason why most people use public transport systems and for this reason public transports are always busy in most of the countries. I also wonder whether someone can actually be able to buy a house through savings these days, because if they start saving today, they might have a good amount after a decade, but after that much time, the prices will again be higher, so they still won't be able to get anything good with it.

Yes, of course what you say is very correct. The current economic conditions are very uncertain, instead of expecting salaries to increase, it is better not to experience layoffs because companies are also experiencing various considerations because they are also experiencing the impact of an unstable economy. Inflation is a scourge that makes everyone's finances chaotic, of course with a mediocre income that can only be used to spend on daily needs and not at all enough to save. Meanwhile, a house is everyone's dream and achieving it is very difficult except for some people who have above average income. In situations like this, the government must seriously look at the problems that occur and be able to provide appropriate solutions for its citizens who are experiencing difficulties.

[Free Market Capitalist]

What would a people first government do in this case?

To get out of the way.

Create social housing in order to lower market prices and make it more affordable?

Lol.

Mandate higher wages?

The plan to set prices by decree is great, lol. People haven't learned anything since Diocletian's Edict. Maduro's Venezuela holds the record for setting wages, so if you want to be like them, you know what you have to do.

Create more housing by giving more permits?

Rather, facilitate them. Prices are a result of the interaction between supply and demand. If the prices of a good are high and you flood the market with that good, you lower them.

The example is California vs. Texas. Texas has a growing demand for homes, while in California it is falling because people are fleeing the state. In Texas, prices are lower because it is much easier to build and taxes are lower than in California.

[jcojci]

They just trying to fills their needs and make it as their priority. Saving is no more they primary because they hard to fills their needs. They will thinks about how they will have money to fills. Maybe they will sell their assets, property or others to have money. They will trying to search for more jobs to get more money.

Inflation coming but people are not ready so they slowly sell many things to survive. The government must have solution for the problems especially about food and other primary things to their people.

Creating social housing may not solving the problems. If people don't have much money, they will difficult to pay the house. Increasing the wages may not a solution if groceries store also raising the price.

It is a hard situation. If the government takes one decision, that can affects to other situation. The governments must considering many things before they decide. Invites more experts in all fields could helps to taking decision.

[alani123]

@Free Market Capitalist

Every time we're here talking about people suffering from the large scale inequality in today's economy you're here with more problems than solutions. Could you do us a favour and be a solutions man for once? 

If in your favourite U.S. state 90% of households can't keep aside one dollar as savings after the month's expenses, how do you think this issue could be addressed? The floor is yours

[Questat]

They really can’t save much because their income is just enough for basic needs. Life is tough in that situation. In theory, the government’s solution would be to increase salaries, but that only works if the economy actually grows. If wages go up while inflation keeps rising, then nothing really improves.

Most of us prefer having stable jobs because of security, but once that job no longer feels secure or can’t even cover basic living, then that becomes a real problem.

@Free Market Capitalist

Every time we're here talking about people suffering from the large scale inequality in today's economy you're here with more problems than solutions.

hilarious.

[davis196]

It used to be that while wages would never get someone rich at least it was possible to eventually buy some property after years of work. Be it at least a house. A house doesn't have any productive capabilities, it's just a roof by pure material standards.

Then the years turned into decades. We've now though reached a point where most people can't save anything.
New stats in Greece show nearly 90% of households can't even save a single euro after the monthly expenses.

What is the result of that? The people are now more than ever liquidating family owned property and businesses to just sustain themselves. Which turns out to be catastrophic for property ownership because it gets very centralised. Banks repossess properties en masse and foreign investors scoop it up also en masse. Locals end up opening less and less of their country's land every year.

What would a people first government do in this case? Create social housing in order to lower market prices and make it more affordable? Mandate higher wages? Create more housing by giving more permits?

No. We just see inaction. And this inaction of course only helps the large owners.

I don't live in Greece and I don't have problems with saving money. The situation in Greece is pretty specific. Greece has lots of debt to pay off and AFAIK, the taxes in Greece(including property taxes) got increased in the last few years. The standard of living for the working class got severely reduced because of higher taxes and stagnating wages. This is what happens when a country gets drowned in debt and has to pay these debts back. There's no easy solution for such big problems. The idea of the government building more housing units for the people would cost a lot of money, but the Greek government doesn't have that much money, due to the high level of debts.

[Fortify]

It is definitely more difficult than ever to earn a decent wage, especially as wages get suppressed while costs continue to go up. Ultimately though you must try to do what everyone else has done in this situation: earn more because that is the rat race we live in. Work smarter, not necessarily harder. Get extra education like qualifications in your free time or pick up a side hustle. Some people are also frivolous or wasteful spenders, so really have a look at your outgoings and see if you can get them under better control. Each situation is unique so there is no blanket advice that will fit everyone. The advice that might work in America or Europe, will not work in India or Nigeria.

[Jubilee58]

This kind of situation is really frustrating as many people only think of how to feed and nothing more. In a situation where most of the citizens are low income earners and can't achieve any remarkable growth even after years of working. This high cost of living can be controlled by the government of the people, it is caused by wrong government policies and central bank monitory policies that are not favourable to the masses.This is not only happening in greece, in a country like Nigeria, thesame thing is also happening to the extent that the citizens even protested at a point.

Inflation can really be very burdensome on the citizens of a country and it is only the government that can restore normalcy in the country's economy by making the right policy.

[imamusma]

It is definitely more difficult than ever to earn a decent wage, especially as wages get suppressed while costs continue to go up. Ultimately though you must try to do what everyone else has done in this situation: earn more because that is the rat race we live in. Work smarter, not necessarily harder. Get extra education like qualifications in your free time or pick up a side hustle. Some people are also frivolous or wasteful spenders, so really have a look at your outgoings and see if you can get them under better control. Each situation is unique so there is no blanket advice that will fit everyone. The advice that might work in America or Europe, will not work in India or Nigeria.

I think this is a problem many people in various countries are experiencing right now, and I agree that the best way to deal with this difficult situation is to strive to generate more income. There will always be an urge to spend money, whether through social media or other means, but we must be wise in prioritizing. Simply put, we must prioritize our needs before our wants. Besides that, rather than simply saving it's better to invest, regardless of the amount, it will be very beneficial one day.

[Fiatless]

What would a people first government do in this case? Create social housing in order to lower market prices and make it more affordable? Mandate higher wages? Create more housing by giving more permits?

No. We just see inaction. And this inaction of course only helps the large owners.

This is a complex problem that would take several years to address. If the government build more social houses, the real estate sector will be affected. Social housing will lead to a drop in property prises which leads to a real estate crisis, as was experienced in China. It will also affect the banking sector since many real estate firms will default on loans.

There is no quick fix method for this problem. Higher wages will cause inflation and cause more harm. The solution should be an improvement of the country's economy. Policies should be put in place to supervise the real estate sector to avoid abuse. The Chinese economy was in a big mess because of abuse in the real estate sector. More job opportunities will naturally lead to an increase in income. Social housing policies should be implemented with caution to avoid destroying the private housing sector.

[bitbollo]

These are clear some evident and serious issues in many western countries.
The real problem here Is related the solution that seems defintely bad than the problem by itself...
If the solution should be and Extreme saving ratio from food (processed) and bad Place for living (capsule or crazy tiny homes). Defintely... The problem Is big and I would stop to rely in government....

[Alpha Marine]

No. We just see inaction. And this inaction of course only helps the large owners.

I think this is exactly the problem, and the inaction is caused by the fact that the problem benefits the big corporations. I belief if a government is actually proactive and anticipate problems, if they actually care about the lives of the proplr in the country, they can make it better. They can control inflation, find initiatives that will create jobs and create an environment where it is easy for people to start up businesses.
In most countries, the two main reasons why people can't save are inflation and because they don't have jobs. Some people have jobs that earn good money, but inflation has eaten deep into the economy, so the money they make no longer has any purchasing power.
The government needs to invest heavily in the people and small and medium-scale businesses, and also make sure the cost of things are at reasonable.