[falcolas]

Speaking only for myself and my parents - the factor here has been land. They both inherited several hundred acres of farm and ranch land, and purchased some land in-town when it was (inflation adjusted) $90,000, and is now in the $2-3 million range.

They're both terrible at saving, their combined income was never over 50% of what I'm currently making, yet they have both been retired and comfortably living off these "investments" for 20+ years now.

I, on the other hand, am just hoping that I can move to part-time work somewhere in my 60's. I'm hopeful, but it means keeping my current income levels for another 20 or so years, and avoiding any major health or other emergencies.

[mistermann]

In Canada it's very similar, LOTS of people are millionaires simply from massive real estate appreciation. Vancouver is particularly shocking, but all of Canada in general has seen huge appreciation. Basically, we had the same bubble as the US did, but ours didn't burst in 2008, it just paused and then kept on going. It's kind of funny reading how after the fact, everyone knew the US bubble had to burst, yet the affordability ratios in Canada are far beyond those of the US at its peak and almost no one bats an eye.

I really feel sorry for people who are merely middle class or not in a marriage where both people have professional level incomes, I just don't know how they can afford anything reasonable in this market. And personally, I thought I'd do the smart thing, rent and live modestly and invest the difference - after all, minimizing your housing expenses by living in 700 sq ft instead of 2500 sq feet should be the financially wise thing to do, right? As it turns out, no, that was EXACTLY the wrong thing to do....the right thing to do was borrow absolutely as much money as possible, and buy as much house as you could afford - anyone who did that is laughing all the way to the bank.

As for retirement for me, I am slowly coming to the realization that I will never be able to retire, ever, whereas my parents retired in their mid 50's.

[jondubois]

I can relate to this - The older generation owns all the land and use hard-working young people to pay the rent so that they don't have to lift a finger. In the western world, older generations tend to not be very generous with their children (interestingly, as I found out, this is often not the case in ex-communist countries like Russia where well-off parents tend to spoil their children rotten - Note that this is a gross generalisation though).

In the west, we have a situation which is just like we had in the middle ages when peasants had to pay their lords commission to work on their own farms (because the land technically belonged to the barons, knights, dukes, kings...). Except in the middle ages, work was based on manual labour and that didn't help any of the peasants to 'grow' intellectually - In fact, only high-society had the time to cultivate their intellect.

In today's society - Now that a lot of jobs are highly specialised and increasingly technical - By working, today's peasant class is accumulating highly specialised intellect. For the first time in history, we have a case where the lower class 'the scum' of society is becoming more intelligent than the high class of society (though not necessarily wiser - In that case, I would suggest the opposite).

I think that's why this idea of 'disruption' is so critical - Disruption is a mechanism which allows the younger generation to acquire wealth from older generations. Older generations have a collective monopoly (lock-in) on the world's wealth, disruption is about pulling the rug from under them one industry at a time.

[rhino369]

I assume the housing market is the majority of this wealth disparity. The nations northern cities have seen huge increases in property values. For those who bought cheaply before the run up, the benefits are clear. You buy a house for 150k in Palo Alto, CA in 1981. And in 2015 it's worth 1.5 mil.

For millenials, we are stuck in a market where you got to pony up 1.5 mil to buy a family sized house.

Maybe the market will just keep going and going. But I don't think our economy can support that sort of thing. At least not the extremes that happened since the 70s.

[jtzhou]

And the person who bought the home in Palo Alto in 1981 is only paying 1/5 of the property taxes as the person in a comparable home who bought recently. California is really the epitome of having a tax code favoring land owners and the older generation over those relatively new to the job market.

[ZeroGravitas]

One of the political ideas that's been bubbling along for a century or so is the "Land Value Tax". It's generally agreed that it's one of the best possible taxes by wonks. If a new generation of renters comes along it may finally get traction (though politically, since the old vote more, maybe not).

http://www.economist.com/blogs/freeexchange/2015/04/land-val...

[gitah]

Well your parents inherited almost a million dollars of real estate so comparing your situation to theirs seems unfair.

[msandford]

30-50 years ago farmland was a few hundred an acre in real terms. Today it's a few thousand. That's inflation adjusted so land has definitely appreciated considerably.

http://www.ers.usda.gov/media/873616/farmrealestatevalues.pd...

What's the rising tide that floats all boats these days? It's not the stock market, it's not real estate, and it's not startups. I can't think of anything that keeps going up, except perhaps for inflation.

[snickerdoodles]

population

[falcolas]

Population growth is going down, and is even negative in many countries. Inflation... not so much.