Tuesday, March 10, 2020

Why the Coronavirus is Better for Millennials Than College

This post does not endorse any financial advice and all advice herein is horrible and will likely cause you to lose all your money, your house, and your wife.   Talk to a financial advisor about investing, not this horrifically-bad-at-economics blog.

Well, let's be honest first.

College was in reality about the worst thing to happen to the Millennials.  A swift kick in the nuts would have served the Millennials better than college, so it isn't that hard of a "gift" to beat. 

But I am being deadly serious when I say that Coronavirus is better for the Millennials than college, and I will go further to say it's the best thing to happen to them in their lives.  Because while the world frets that it's about to come to an end, countries issue travel bans, countries go under lock down, and corporations allow you to work from home (which now you KNOW it's bad) there is something else happening to the Millennials' great great favor.

Prices are going down.

Though related to a separate incident, I noticed the price of gas dropped to $1.92 in my area.  I already knew stock prices had been dropping due to Coronachan, but it was that harsh drop that reminded me of how I yearned for the Great Recession days where gas was cheap, hotels were cheap, lines at nice restaurants were non-existent.  And while everybody runs around with their heads chopped off, thinking this is the end of the world, this is in fact a good thing.

A very very good thing.

Right now Millennials complain about everything being expensive.  And they're right, it is. They voted for previous presidents to print off money to bail people out of the banking crisis and their poor personal choices, but that money inevitably found its way into the housing and stock markets, driving prices (and rents) up beyond affordable levels for the Millennials.  Since then, millennials have been paying over-exaggerated prices in rent and what few were lucky enough to afford it, over exaggerated prices for stocks.  And with these two items being overly expensive - housing and retirement - it was likely they were never achieve these two key pillars of the American Dream (but they did pay laughably stupid high prices for "the college experience"). 

But now, thanks to their Lord and Savior - Coronachan - prices are coming down.

Keep in mind the stock market would have to be halved to get back to what would be traditionally considered "average" or "fairly" priced.  The dividend yield is around 2.1%, it would need to be 5% so we still have some ways to go.  But with the media - not Coronavirus - scaring the hell out of everything in the world, the stock market has had a "20% Off Sale" in just 2 trading days.  It may not be fairly valued, but it is 20% cheaper than it was before.

This has only affected the stock market, but there is a chance this scare will last long enough it can spill into the housing market.  With different companies shutting down operations, no matter how temporary, with nearly every American living paycheck to paycheck, temporary furloughs can wreak havoc on the housing market, and thus housing prices.  I personally don't see this happening (truth be told, with China cutting off exports, construction materials could actually cause a jump in housing), but if Coronavirus sticks around long enough to effect the core, infrastructure of the real economy, it's possible Millennials might see affordable housing in some areas of the country...though that would mean they'd have to give up living in cool, socialist, prestige status towns like San Francisco, Austin, and New York and find jobs in towns they can afford to live in.

Regardless of how we get to lower prices, the point is a simple lesson in economics - you want lower prices.  One of the largest failings of the average American and their understanding of economics is that lower prices for EVERYTHING is good.  Not just gas, clothes, or food at happy hour - everything.  And if you look at your budget you'll find that lodging and retirement are two of your largest expense items, the lowering of which would drastically increase your standard of living.  Young people especially should be cheering the stock market and housing market to plummet in price because it would be the best financial thing to happen to them in their lives.  But more so than they think, and I shall explain why. 

Because if the stock market or housing goes down any more than it has, whatever over-inflated prices Millennials paid for their laughably stupid college education, they will save it in housing and retirement.  That $1.5 trillion you're asking to be bailed out of, has been more than offset by the multiple trillions of dollars the stock market has lost.  And if Millennials wanted to have the power to do something about it, instead of outsource all hope and power to Bernie to bail them out, now would be the time to consider tossing a couple bucks into a retirement account or inquiring with your local bank about getting approved for a mortgage.

The problem, however, I can already forecast in looking at the average person's personal finances.  Most people (not just Millennials) spend all the money they make.  They have no extra money left over or earmarked for retirement.  They need those extra monies for specialty brew pubs, car loans they took out (while complaining about student loans), and other first world luxuries instead of saving for retirement.  So even though the Goddess Coronachan is giving you Millennials the opportunity to recoup the excessive costs of your college degrees, you aren't financially responsible or savvy enough to capitalize on it.  Besides, you'd have to spend 10 minutes setting up a retirement account and it's just going to be easier to vote for Bernie to take other people's money from them anyway.  I know how lazy the Millennials are.

But regardless of the sloth of the Millennial generation, an economic curiosity does need to be pointed out.  And that economic curiosity is that Coronavirus - a virus that sickens and occasionally kills people - has proven to been better for the Millennials THAN A COLLEGE DEGREE.    Coronavirus - combined with a Sky-Is-Falling media - is the best thing to happen economically to the Millennials IN THEIR ENTIRE LIVES.

It's just whether they're smart enough to realize this...but given their college degrees, I doubt it.
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King Mob said...

Sorry to be the grammar police but it's "affects the core" not "effects the core"

Anonymous said...

@King Mob; How dare you correct Mr. Curse Of The High IQ! How dare you, sir! X-)

stevo said...

Hey Captain. Haven't been here for a few years. You were a big part of my red-pilling many moons ago. Glad to see you're still crushing.

Anonymous said...

Corana-chama is a centrifuge moment - the stupid idiot millennials will panic or do some dumb shit in response like buying a bunch of prep gear or whatever. And there will be people like myself who perceived the stock market as a significant bubble a couple months ago and pulled out before this who benefit drastically.

The stupid fall and the smart rise. Corona-chama just makes it happen faster.

Anonymous said...

I heard universities are closing down campuses due to Coronavirus. Students have to do online classes. Clarey's idea for online schooling is actually working. Students might save money and not go into debt. A lot of professors and faculty who depend on campuses will be screwed, but Clarey hates them for screwing off many millenial's career and financial futures. Maybe my taxes will not go into funding a lot of those college campuses. If lazy poor people are dying off due to the coronavirus, taxes on welfare will go down. Coronavirus might mean lower taxes. This situation could be a positive outcome despite all the chaos, hysteria, and death.