Sigmund Freud's nephew, who used psychoanalysis to sell products. Freud hated Edward and Anna for going that route. They are the reason more women smoke and why Americas eat bacon for breakfast.

If you want to know more, watch The Century of the Self by Adam Curtis.

So like everyone else they did both good (bacon!) and evil (smoking).

(Most of) the rest of his films: http://thoughtmaybe.com/by/adam-curtis/

EDIT: I will live frugally and drastically below my means forever (and I'm only 34!) while putting aside substantial savings; the fear of running out of funds in the last part of my life is terrifying. Seniors have every right to be fearful and hoard their cash.

Source/experience: Support my disabled mother who has zero assets and substantial medical expenses. If you're not afraid of saving enough for retirement and unexpected medical expenses, you should be.

The UK has an efficient annuities market, it seems to me. My understanding was that in the US, it was to a large extent a tax-avoidance scheme, rather than a risk-mitigation mechanism, but I don't know enough about it.

The variable ones are far more profitable and so get pushed onto people while you need to go seek out someone to sell you an ordinary annuity. They have a deservedly terrible reputation which I fear has tainted the ordinary kind somewhat in the public mind.

The article implies with the talk about "training people to spend" that other people should be concerned about this, but doesn't say why. I'm not really seeing it. It's not like the money supply is fixed. There are other ways to grow it if the Fed were willing to do it.

Look at this paragraph from the article:

One of those irrational reasons may be simple habit. Something strange happens when people retire, Browning says. All of a sudden, they’re not getting a regular paycheck, and that makes them scared to spend. Goals set before retirement are abandoned, along with pre-determined spending plans, because retirees are terrified see the balances on their retirement accounts drop even a tiny bit.

What's wrong with someone, like a financial planner, reassuring a couple that yes they can take those vacations they always dreamed of, yes they can pay for their grandkids' college tuition, yes they can make a substantial donation to that museum they love so much -- here's the math showing that it is likely to be okay?

Given the reluctance of our culture to show care and concern for people in general, I'm not too psyched about getting to the end and needing a handout.

When done properly, it can be fairly tax efficient.

There is an inherent asymmetry between living somewhat more frugally and dying in poverty.

(Also: Estate tax as a way to fund basic income?)

It may sound interesting and promising but is most likely the most unjust way of taxing as it will force people are retired or about to retire out of their homes (that they are not paid for using funds from the basic income).

While the consequences of non-payment would also be forced sale, it is possible for residents to petition and sue the to assessor's office in order to reassess the value and obtain deferments, and the owners are still compenseated for the value of any real property located on the site. This is more just than an income tax, as failure to pay could never result in imprisonment.

Additionally, it would lead to far lower cost of housing, mortgages, and rent. This means less savings and income would have to be allocated toward acquiring the house in the first place. It would also be more just to those who are not wealthy enough to buy a house outright, and must instead rent or obtain a mortgage.

When spending on public services increases the land values and attractiveness of the location for which these services apply, and is financed via taxes on labor rather than taxes on land, this subsidizes land holders and banks invested in mortgages by allowing them to charge higher rent for housing.

(I'm afraid this confusion makes your comments about retirement and forced property sales make very little sense... unless I'm missing something?)

Not for existing homeowners admittedly, but certainly for those in the future.

One drive the offer, the second one drive the demand. The economy is basically the flow from one pot to the other.

With interest rate at historical low, large business with trillion hoarded, money is already plentiful on the investment side. This article is just claiming that there is portion of that investment money could be reallocated on the consumption side which would indeed allow the economy to run.

The article is very optimistic that this money is really what is missing. Personally not quite sure about that as the economy already relies on historically high level of debt on the consumer side (i.e. consumer spend today and tomorrow money), adding fresh money in the system is at best a short term "solution", adding memory to a memory leaking system.

The problem is that there is simply not enough money flowing from the investment pot into the consumer pot. i.e. salaries are too low, tax on profit are too low, ... something isn't balanced and we are all playing economic musical chair, with people hoarding money to avoid being without once the system breaks.

And that's where the entire FI concept of "knowing when you have enough" comes in.

http://moneyboss.com/beyond-wealth/

This is looking at why people are living more frugally? If people want to buy less/travel less, then that is no problem. If they are doing it because they are worried about the future, that is a problem.

Spending has an effect on not just those people, but on all of society when it happens at a large enough level. And it is one of the common way to pass money from old to young.

For instance (all of this assumes you have the money to do so), a bookkeeper for your small business. A CPA for your taxes. A lawn service. A financial planner. A bidet.

It makes me wonder what else like that is out there. Stuff that isn't purely materialistic, but is "worth it" for whatever value if "it" matches your net worth. For perpetual savers, being counseled on how they can spend their money (on worthwhile endeavors) might actually be useful.

[EDIT] my belt says "Trak Line"

I'm very sure that unless I get very lucky, I am so very fsck'd for the rest of my life.

These are also tax-deferred plans... income the IRS is not receiving.

EDIT: Clarity

This is Keynes' Paradox of thrift.

https://en.wikipedia.org/wiki/Paradox_of_thrift

If the occasional person is thrifty, there's no problem.

If everyone is collectively "too thrifty", then we've got a problem, but this isn't the cause of the problem, it's a symptom. What does it mean when everyone is saving? It means that there is some kind of uncertainty or fear which is making people forego current consumption in favor of future consumption. This isn't a natural state of human affairs, since we tend to value things today more than things tomorrow. The extra "thrift" happens because of political or economic uncertainty.

Political uncertainty is fickle, you can't predict it or plan for it. However, saving is the correct response to economic uncertainty, and it's what's responsible for the eventual recovery after a crash.

In fact, that is precisely the paradox - that the individually responsible and rational thing (more saving in the face of uncertainty) actually accelerates the problem: an economy crashing down.

Among the policy lessons would be to reduce uncertainty, and encourage consumption (in the economic sense), e.g. via government provided stabilisers (food stamps, unemployment benefits, etc.).

> saving is the correct response to economic uncertainty, and it's what's responsible for the eventual recovery after a crash.

That's a very contentious statement, and personally I'd be rather careful in casually contradicting eminent economists on economic matters.

Here's one economics PHd wielding economist refuting the paradox of thrift. http://www.econlib.org/library/Columns/y2009/Murphythrift.ht...

Here's an eminent one refuting it, in case the Nobel prize counts: https://mises.org/library/hayek-paradox-saving

Here's my issue with Keynesians and neo-Keynesians. They have zero concept of capital, it's all about cash flow - spending, saving, debt. They stimulate by printing, temper by taxing, etc.

They ignore the effects of such behavior on capital, and end up amplifying the cycles they try to prevent. This ties into monetary policy and deficit spending as well, but that's way too much of a tirade for Hacker News.

The invocation of Say's law strikes me as insufficient to strike down the paradox of thrift.

Seems strange to live on the notions of man who lived before today's environmental concerns became cause for alarm.

However, these individual actions might collectively have unintended consequences, and that's what the paradox of thrift is about. It's a descriptive concept (i.e. about what happens in the real world), not a normative one (i.e. what people ought to do).

But before you decide what one ought to do, it is best to take into account what actually happens in the world.

It might well be better if people spent more (and that need not be on material things, it could be education, concerts, and so forth).

But yeah, it could mean spend more on bridges, universities, or jewel studded iPhone cases.

Are the piles of money in mattresses really all that much bigger today than they were 30 years ago? Beyond the demographics of the baby boomers, this feels like a non-story to me.

From the article:

> After a lifetime of saving, it requires some psychological gymnastics to start spending your nest egg. Browning’s suggestion is that financial planners urge their thriftiest clients to make big purchases–like a second home or a fancy car–before they retire, out of their pot of savings. The idea, he said, is “training people to spend.”

Edit: this comment is attracting a surprising amount of downvotes. Strangeness

It's not at all clear that the authors of the article are concerned about the well-being of rich old people. There seems to be some other argument that's not being stated explicitly.

Just like arguably a lot of austerity in the Euro zone was self-defeating.

I don't think the article is suggesting that financial planners recommend their clients take one for the team and spend more money.

Unless you get enjoyment on some level from the financial security of having a bunch of money saved (i.e. you sleep better at night because of it). It's like purchasing insurance - if you never end up using the insurance, that doesn't imply you made a poor decision (wasted money) in purchasing it.

Likewise, knowing that an expensive medical emergency could come up means that having considerable savings is an appropriate response.

Or you could take the opposite view and arrive at the same conclusion - if you have a healthy lifestyle and expect to remain healthy, you might predict that you'll have a long lifespan, making it prudent to conserve your retirement savings by spending it at a very slow rate.

"an increase in autonomous saving leads to a decrease in aggregate demand and thus a decrease in gross output which will in turn lower total saving."