What do you consider rich?

[stinkcat_14]

Note that in your own example, the dealer waits for the stock sale to clear. In other words, you can’t close the deal until you converrt unrealized wealth into realized wealth.

And the dealer would have nothing to wait for if it weren’t for the unrealized wealth. In real life, I don’t have $80,000 in Intel stock, so I won’t be hanging around any dealers any time soon. Actually, I could also close the deal using unrealized wealth if I was willing to take out a margin loan. There are many ways to use our unrealized gains to increase our consumption, so therefore, we need to consider it as a form of income, which is why Haig-Simons is so useful.

 

[vern_humphrey]

And the dealer would have nothing to wait for if it weren’t for the unrealized wealth.

Yup – but nevertheless, he has to wait.

In real life, I don’t have $80,000 in Intel stock, so I won’t be hanging around any dealers any time soon. Actually, I could also close the deal using unrealized wealth if I was willing to take out a margin loan.

Which is a zero-sum game – you now have less disposable income because you have to pay interest on the loan. You also have less unrealized wealth – because your Lexus depreciates as soon as you drive it off the lot.

There are many ways to use our unrealized gains to increase our consumption,

All of which involve turning unrealized wealth into realized wealth.

so therefore, we need to consider it as a form of income, which is why Haig-Simons is so useful.

Useful, how? To pretend that we have what we do not have? To go broke paying high interest rates so we can drive a depreciating automobile?

 

[NMJenny]

I have six wonderful kids, sixteen grandchildren, and a great-grandchild.

I’m rich…

 

[whatevergirl]

A little known fact about millionaires…most self made millionaires in this country (excluding Oprah, etc) drive average cars…and live modest homes (as it relates to their wealth)

I watched a documentary years ago on this, showing how there are so many couples…working like dogs to live in these mansions…and because they are living way beyond their means…are often living in UNFURNISHED homes. A big home to tell people where they live…but not enough money to really take care of it.

Moral is…people should live below their means. Then, you will always have money in the bank. You can still live in a beautiful home–but you are not a slave to it. Money shouldn’t control you…you should control your money…and it’s all God’s anyways…I’m merely a steward over what God has blessed me with.

 

[stinkcat_14]

Ok Vern, perhaps a numerical example will help you understand this.
First, let’s define income as the ability to consume without reducing net worth. If I earn $10,000 this month at my job, I can spend that (ignoring taxes) without reducing my net worth. We would probably both agree that is income (but I don’t want to put words into your mouth, so please forgive me if I am wrong). Suppose that my net worth consists of a $1,000,000 stock portfolio. If my portfolio goes up by 8% next month, I have the ability (whether I choose to use it or not) to spend up to $80,000 without harming my net worth. That is also income, which is what Haig-Simons pointed out to us.

 

[RWMorris]

I was a child of a missionary when I was growing up. We ministered in Mexico in the back country near Guanajuato. I remember once we lived in a small shack that had been someone’s chicken coop. It was only two rooms but had a beautiful garden. I thought we were rich to get that place. When we came back (I was 13) I realized that Americans are rich. We don’t even know we’re rich. We have the most luxurious and wasteful lifestyle on the planet. We buy things we don’t need, drive luxury cars on the premise that “we deserve this”; in fact, our whole lifestyle is centered around the acquisition of things.I try not to be judgemental, but when I was a young mother of four children my husband was active duty Air Force and we lived on less than $1000 per month. This was in 1990. We managed to pay a house payment, and car payment, buy/grow groceries, and still give money for charity, and also contribute to our retirement funds.
I truly believe that there is a reason that Jesus had so much anger for those who are rich and contribute nothing for the welfare of others.
If you are American, you are rich. How many of us contribute to the welfare of our own Church’s lay missionaries? I am just curious. You can buy them half-a-week of getting by for only $50 a month. If you’re interested, post and I’ll give you the address.

 

[Proletarian]

Kind of an offshoot of the Rich Have Passion thread, but a bit different. I thought it deserved it’s own thread. If I put this in the wrong place please feel free to move it.

My SIL is a nice person. She works hard and her husband works hard. They have nice things to show for it, a beautiful house in a nice area, two expensive car,nice clothes, ect…For some reason she feels she has to justify her lifestyle to me. I always tell her, “whatever makes you happy…”

Dh and I live a considerably different lifestyle. Dh has worked his way up in the mental health field. We live in a mid to low income area, and we own second-hand cars. I’m a work at home mom (home daycare) so that I can be home with the kids. I don’t justify my lifestyle, simply because it works for me. I also don’t judge work outside the home moms. I was one once. I know that all three WOHM, WAHM, and Stay At Home Moms work hard in different ways. Let’s face it, WOHMs are my bread and butter too.

So what do I think is rich? For me it’s enjoying my life, where I am, right now. Yeah, a little extra money would come in handy, but money doesn’t always make you happy. I’ve been very poor as in working below minimum wage, living on walfare, poor. I never thought of myself as poor, though. My kids were well cared for. I had a roof over my head and food on the table. Sure it was a struggle sometimes, but we were still happy. To me, that’s what rich is.

Kim

Strictly speaking “wealth” is the amount of capital one owns with respect to others. It is what that person does with that capital that makes them a good Christian or not. A good Christian will not live beyond their needs in a world awash with poverty. BTW one does not NEED to have a fancy car or a fancy house when there is so much material suffering in the world.

1 John 3:17
If anyone has material possessions and sees his brother in need but has no pity on him, how can the love of God be in him?

 

[leonie]

As a mom, I’d consider the following necessities for my family:

food, clothes, good books, a van to transport them to wholesome activities and church, and a safe neighborhood in which to live, and the ability to have one parent at home available to care for them.

I think the key for most families is the cost of housing. In Indiana, housing is very reasonable. In some cities and states, I really don’t know how the average families can survive after paying rent/mortage/taxes. Of course, even here, the bankruptcy rate is very high.

I think a safe neighborhood is very, very important.

 

[Proletarian]

As a mom, I’d consider the following necessities for my family:

food, clothes,

You really meant to say good food and nice clothes didn’t you? We couldn’t have our children walking around looking like they were poor could we.

good books,

They don’t need good books, they just need books. Who cares if they’re second hand, tattered, with a few scribbles?

a van to transport them to wholesome activities,

I take it you were in part referring to necessities like Scouts, soccer or baseball.

and a safe neighborhood in which to live…I think a safe neighborhood is very, very important.

Is this how one should justify living in a wealthy area?

You have a very interesting concept of necessity.

 

[Minnesota_Mary]

The way to achieve enough wealth to sustain you throughout your entire life is to work hard, live below your means, save, and invest wisely. When you deny yourself things that you would like but don’t need, you build character. Those who cannot deny themselves instant gratification wind up having no money.

The real value of money is that it gives you freedom. Freedom to leave a job you hate. Freedom to relocate to another area with more opportunities. Feedom to be a person of integrity. In other words you don’t need to do things that are deceptive or deceitful to make a buck so you can pay your bills. Having enough money gives you the opportunity to be generous with others and to give to charity as you see fit.

Saving for the future and any unforseen rainy days enables a person to be self sufficient and independent. It is a sign of character, and those who manage to save enough to see them through old age are to be commended for not expecting others to take care of them. And if when they die, they are able to leave something to their children and charity, it is good. Hopefully, they will have instilled their same values in their children.

 

[Pug]

They don’t need good books, they just need books. Who cares if they’re second hand, tattered, with a few scribbles?

The phrase “good books” does not mean new, leather-bound, gilt books. It means edifying books, like the bible or the Summa or a solid history book (though, for some it means poetry or literature). I have lots of “good books” that are quite used. I consider myself wealthy in that I have so much available to read, that I am literate, and that I still have eyes to read the books.

Individually owned books are not a necessity for an individual, not really.

 

[Proletarian]

The phrase “good books” does not mean new, leather-bound, gilt books. It means edifying books, like the bible or the Summa or a solid history book (though, for some it means poetry or literature). I have lots of “good books” that are quite used. I consider myself wealthy in that I have so much available to read, that I am literate, and that I still have eyes to read the books.

Fair enough.

Individually owned books are not a necessity for an individual, not really

Agreed.

 

[Proletarian]

The way to achieve enough wealth to sustain you throughout your entire life is to work hard, live below your means, save, and invest wisely. When you deny yourself things that you would like but don’t need, you build character. Those who cannot deny themselves instant gratification wind up having no money.

I think your on to something! That 90% of the world’s population that live off a few dollars a day just don’t work hard enough; those lazy scoundrels!

 

[jman507]

Rich is not to try to live to avoid trying to achieve a state of some fantasy of what ‘rich’ is, but to use your resources with prudence and temperance. To seek justice and fortitude is also good, though I assume what that means is a tough one to come up with on this thread. OK, that’s not exactly what rich is, but just how to go about it. If anything it doesn’t matter if you are rich if it’s going to become used up.

 

[jman507]

I think your on to something! That 90% of the world’s population that live off a few dollars a day just don’t work hard enough; those lazy scoundrels!

Thank you for the non sequitur, though if you actually want to persuade someone of something, you might want to leave those out.

 

[La-Petite-Fleur]

I consider rich those people who have given their lives to Jesus. Theirs is the kingdom of heaven.

 

[Milliardo]

I won’t be too idealistic, but rather realistic. I consider someone rich one who has a large house, or a mansion actually, a lot of cars, especially those sports cars like a Ferrari. They have it all: the latest gadgets, perhaps for those uber rich people, a yacht, helicopter or even a private jet. These are the real rich people. I differentiate more between being rich and being successful, since to me being rich almost always equates to material things, whereas being successful would be more of a state in life. Success goes beyond the material, and can mean reaching one’s goals or being in that state wherein you’re fulfilled.

 

[Proletarian]

Thank you for the non sequitur, though if you actually want to persuade someone of something, you might want to leave those out.

Your right. It just frustrates me to see how ignorant people are of the poverty that exists in the world. Let me formulate my post in a more mature manner.

The way to achieve enough wealth to sustain you throughout your entire life is to work hard,

Those that live in desperate poverty (around 90% of the world’s population) have to work to their limits just to survive; if these people did not work as hard as is humanly possible they, and their family, would die. It is entirely unreasonable to suggest that those living in poverty simply don’t work hard enough

live below your means, save, and invest wisely. When you deny yourself things that you would like but don’t need, you build character. Those who cannot deny themselves instant gratification wind up having no money.

What else could they possibly deny themselves of? They have no food, dirty water and sub human living conditions. Yes, they could save money if they were to deny themselves; but they would also die.

 

[jman507]

Your right. It just frustrates me to see how ignorant people are of the poverty that exists in the world. Let me formulate my post in a more mature manner.

Those that live in desperate poverty (around 90% of the world’s population) have to work to their limits just to survive; if these people did not work as hard as is humanly possible they, and their family, would die. It is entirely unreasonable to suggest that those living in poverty simply don’t work hard enough

What else could they possibly deny themselves of? They have no food, dirty water and sub human living conditions. Yes, they could save money if they were to deny themselves; but they would also die.

If they are living in poverty like that, she may not actually be saying that she blames them for living in poverty due to their actions. I’m sure both you and her would agree that most of them cannot live below their means, due to the context of their situation. Granted a few will be able to get out of poverty due to a mix of luck of an opening in opportunity and working at taking it, but generally that case would be exceptional.

But the thing is, if you do have the opportunity to avoid poverty, given that situation, one ought to take advantage, so at least they are able to not add to the problem, but to help.

 

[vern_humphrey]

Ok Vern, perhaps a numerical example will help you understand this.

I’m still trying to understand how I can borrow money at a high rate of interest, buy a Lexus with it, and somehow increase my income.

First, let’s define income as the ability to consume without reducing net worth. If I earn $10,000 this month at my job, I can spend that (ignoring taxes) without reducing my net worth. We would probably both agree that is income (but I don’t want to put words into your mouth, so please forgive me if I am wrong). Suppose that my net worth consists of a $1,000,000 stock portfolio. If my portfolio goes up by 8% next month, I have the ability (whether I choose to use it or not) to spend up to $80,000 without harming my net worth. That is also income, which is what Haig-Simons pointed out to us.

Only if you realize it – you have to sell the stock before you can spend the extra money. By itself, the stock is simply numbers on a page.