People will overgeneralize this. The biggest similarity is that they are both personal finance / money related subreddits. The other connections are mostly the human mind making a story. Not everyone on r/poor is poor, not everyone on r/btc owns a lot of bitcoin.
How can you possibly estimate the percentage of poor people on r/poor and the number of Bitcoin holders on r/btc? Do you think there are a lot of people who aren’t coffee drinkers on r/coffee?
Also why r/poor specifically? There should be a lot of overlap between r/personalfinance based on your theory.
/r/btc is actually the bitcoin cash subreddit (though they welcome conversation of other cryptos). Most people in that sub probably hold very little bitcoin if any (except perhaps those who joined by accident).
In /r/bitcoin you get banned for discussing other cryptocurrencies, so I'd wager most of the subscribers hold more bitcoin than anything else.
That’s because they are both in the money cluster. People that want to post/comment in one subreddit about money are more likely than the average population to want to post in another subreddit about money.
I doubt more than 10% of people who buy crypto are "experts". In the sense that most of them can't explain how a blockchain works (even roughly), what problem it's really supposed to solve, and what the actual difference between BTC and ETH is, let alone other chains, DeFi, NFTs, etc.
The reality is that it's very, very difficult to understand crypto in any real sense. And that's without considering that whichever side of the argument you lie on - crypto is a weak proposition insofar that so is gold and cash.
It's mainly a solution to the Byzantine Generals problem which is basically about forcing trust among the trustless or untrustable. How does it solve that? By forcing the participants to invest in the system in such a way that they can only participate in a trustable way. That may seem like circular reasoning, but the details get into nested rabbit holes that cross computer science, cryptography, psychology, and economics.
Best to read up on it for more explanation. As it's over a decade old it should be trivial to find commentary in your preferred language and level of analysis with only the simplest of queeries.
The only way to understand it in a real sense is to realize that currencies don't have to make any sense whatsoever. If people accept it, it's a viable currency. Literally nothing else matters.
Fun fact: 90% of USD doesn't physically exist according to the Fed itself.
r/poor is only a subreddit with 7.2k members (tiny!) so I wouldn't read too much into things, in addition to what others have to say about overgeneralization.
I would just like to point out that r/btc membership is not correlated with membership of r/personalfinance. I think that provides some evidence that this isn't just an "interest in finance" correlation.
Not just crypto, but the whole enchilada of toxic masculinity[0]: guns, UFC, get-rich-or-die-trying prosperity gospel, “seduction techniques”, and so on. There’s even “murderedbywords” for the best-phrased contrarian put downs, a place that manages to be more like HN than HN itself.
All the typical props of the interior decoration of the modern loser’s mind, in one place.
[0]: chill, dude! Your masculinity is non-toxic, probably. In fact the term acknowledges non-toxic masculinity as the default , since otherwise there wouldn’t be a need to add the modifier.
I can't help but feel bad for a lot of the stuff I read in the crypto subs. They read about people who invested like $10k into crypto and became a millionaire, then invest $100 and hope for the same. The amount of disdain in those subs for safe investments is borderline dangerous and the prevailing attitudes there are going to leave most of them worse off than they'd otherwise be.
They were talking about safe investments. I’m not sure most should or would consider ARK funds anything but speculative. The only difference is the companies held have some underlying assets and value.
The hate I usually see in crypto discussions is directed towards index funds or blue-chip stocks.
My investments knowledge is limited, but I think ARKG is an ETF, but not an index funds.
It is actively managed, meaning that specific stocks are selected to be part of the fund. This is the opposite of an index fund, where the goal is to buy the whole market.
That's why a fund like ARKG can sometime outperform the market, or, like recently, under perform. An index fund would match the whole market performance, no more no less.
Honestly it's scary. I literally just was talking to my nanny a little while back. She was telling me about her parents and brother, both basically pretty desperately poor, who have invested their life savings into GME, a literal meme stock. I laughed when I first heard about GME, but seeing people who have no idea what they are doing invest in something so incredibly risky is really painful to watch. Come the next big financial crisis, this cannot end well.
It's very sad. I strongly believe that far, far fewer people would be doing this kind of risk-taking if their savings account was yielding at or above inflation, as it did from the 80s to around 2005.
There's this, but they're also unsophisticated investors doing unsophisticated investor things. Many of them truly don't understand what a good or bad investment is.
Safer and more stable relative to GME, absolutely. But I'm also worried about the very large group people that have thrown most of their savings into the S&P 500.
I basically lived this arc in fast motion that week. Monday I was like “huh, interesting”, Tuesday I had some laughs with my Dad (who works in banking) about how crazy it was, then Wednesday I started seeing a lot of my friends who work in retail and food service talking seriously about getting Robinhood accounts and kicking themselves for “not getting in on the ground floor”. By Thursday I was texting close friends trying to convince them not to dump their paycheck on this bonfire.
All along the way, there were some people who were calling me a killjoy and saying that everyone on board was in it for the lulz. But the people I saw doing this were not ironic memelords or anything, they were earnest working class folks who were taking the memes at face value and throwing money at what they believed was a chance to take down wall street while make money doing it.
The valuation before the short squeeze was pricing in the risk of bankruptcy. Covid hit Gamestop hard, and part of why it was so heavily shorted was that many thought the company was circling the drain. A year later that's no longer such a common opinion, so even ignoring the shenanigans you'd expect the price to be considerably higher.
This is basically the 1930s stock market crash all again. Once your nannies grandma starts talking about crypto you know the bubble is due to pop soon.
Desperate people do desperate things. This is why I really hate the crypto bros - the whole system is set up to rip people off, often the most desperate and tech illiterate, given the coin and NFT pitches are transparently bullshit to those of us with no vested interest and some familiarity with the tech and economics.
My suspicion is that this is caused by both the marketing that crypto has done, and the wide ranging perception that the official mechanisms for investment and wealth growth are rigged against most Americans.
That perception is generally correct. Even having switched to tech from another field I took seriously...it's still luck that I was able to do so to a significant degree.
I also see it a lot outside of crypto. Heck, it’s starting to show up in surveys about “the American dream”, lots of people now think the system is rigged.
Maybe the Fed should have thought about it when they obliterated the interest rates which used to be the safe and default form of investment for poor and old.
People making regular salaries know their window of ever being wealthy is going away with every year they see 20-30% housing price increases. It is fucking dire making working class or middle class wages in most of the US unless you have a sizeable inheritance. Hope does not exactly abound.
A lot of the middle class has a straightforward shot at retiring wealthy. If you invest $X per year (and adjust it for inflation) for 43 years (22 to 65), and get a return of 7% after inflation, then you can withdraw $23X per year until your 90.
For whatever income you define as wealthy, a huge chunk of society can afford to save away 1/23rd of that annually.
Under today's taxes in the US, those gains are tax advantaged compared to income, so take whatever salary you define as wealthy and put away 1/29th of it per year, roughly.
It's not accessible to everyone, but calling it "fucking dire" is just fearmongering people into being even worse off with the lottery.
> It's not accessible to everyone, but calling it "fucking dire" is just fearmongering
Individual economics are dire in terms of how much it costs to have basic security with housing specifically.
Median home price in the US was $222k in 2008, its $400k in 2022. Rents have gone up accordingly. Average person sees their paycheck go less far every year, and then add inflation on top of it. Putting away $1k in a year sure doesn't seem like it helps you.
Everything works out pretty well for you if you somehow own a house in the US, just hope you aren't behind the curve on assets.
> Median home price in the US was $222k in 2008, its $400k in 2022. Rents have gone up accordingly
This is between misleading and untrue. Home prices have gone way up, while home monthly payments haven't, due to the extremely low interest rates on mortgages. This means that downpayments are less accessible, but the rest of the payments are about as accessible as before. Until 2021, monthly payments were actually unusually cheap for the last bunch of years. Probably offsetting the higher down payments and lower inflation.
But the big one is that rents haven't gone up accordingly. I couldn't find 2022 data, but from 2008 to 2020, median monthly rent went up from $783 to $1,104. In 2020 dollars, it went from $941 to $1,104, or 17%. It's significant, but nowhere near the doubling you posted.
It’s a good point that offsets a bit of housing costs, when going from higher interests rates to lower. However when housing prices go up while the low rates stay the same housing still increases in cost. Rent amts have not stayed the same, they’ve climbed.
The real problem is treating them like investments, when buying/spending is what makes them valuable.
I bought $1000 worth of BTC in ~2006. If I'd held onto it I would...probably not be a millionaire today, even if the math says so, because it was band new then, and using them is what makes them valuable.
This is the case in r/WSB for stocks but I've rarely seen stuff quite like that in crypto subs (check e.g. https://www.reddit.com/r/CryptoCurrency/top/ ). The discussions are low quality and people do obviously believe they will make money but that specific type of post isn't all that common.
Of course, I don't visit the smaller memecoin subs which might be like that and same for possibly the Dogecoin one which is the largest one which I imagine might have that type of post.
I would expect the list of the "overlapped" subreddits drastically changes if you calculate it next week. r/poor only receives a small number of posts. Most submissions have <10 comments. So there will be a high degree of fluctuation in statistics like this. (I don't think it's based on overlapped subscribers because that's not publicly available information.)
I would guess that it just happened that some (or even only one) of the those few who posted recently to r/poor were interested in bitcoin, nothing more.
Not clear how the stats are obtained, and from what data. It would probably be useful to match each subscriber to r/poor with a non subscriber that is similar, i.e. similar account age, similar numbers of total subscriptions, etc. If instead the "control group" is all non-subscribers to r/poor, I could see accounts that subscribe to nothing other than r/all, or throwaway accounts, etc. skew the entire analysis.
Funny to note that the top post of all time in r/poor is someone telling people to "Buy even 10 dollars in Bitcoin at a time if that's all you can spare," with investment advice stating:
> It's the best way to save/grow an emergency fund. And if you can hold indefinitely, then you can grow true financial freedom by saving even just 5 dollars at a time, anytime you can spare to do so in Bitcoin. Don't think of it as an investment, think of it as a savings account that works and doesn't lose buying power thanks to inflation.
Technically, also true for a ponzi scheme. Anyone invested in crypto will increase the value of their holdings by getting others to buy in and exiting before they do.
Until this thread I really thought that nearly all crypto speculation was just people in tech with more money than they knew what do to with having a bit of fun. Stupid, but harmless stupid. If you get paid 300k a year, why no buy a 10k NFT for fun.
I had no idea people outside of tech were taking this stuff so seriously, I can understand a bit better why some people have essentially made it their life's mission to denounce crypto as a scam.
>>>I had no idea people outside of tech were taking this stuff so seriously
I know a Navy dentist who told me back in February that he was putting all of his disposable income every month into Cardano. One of the Staff Sergeants I work with made ~$15k back when Doge spiked to the moon, and all of our Lance Corporals discuss the latest coins daily.
A couple oil changes ago the guys at the shop were all talking about investing in doge. They were so excited about it. Now I'm not going to say they're poor, I don't know, but they're probably not rich. Someone wound them up good.
At least they are only advising them to invest a little and sadly it's not like you can invest $5-10 in something like an index fund. The top comment even just advises to protect against inflation generally, and not with crypto if you don't particularly like to.
Note that if you reverse the direction, r/cryptocurrency has a much higher correlation to r/stockmarket, r/investing, r/fatfire, r/realestateinvesting, and r/collapse than to r/poor. Same goes for r/bitcoin. r/poor does not even make the list when viewed from the crypto subreddits.
I think this is simply that crypto subreddits are big, and so if you try to find the overlap between r/poor and anything else, a big subreddit will be high on the list. Same reason that r/bayarea is high up on the overlap list for r/poor - at first glance, the assumption is that poor people live in the Bay Area, but then when you reverse that causality and look at what Bay Area people are interested in, r/fatfire, r/costco, r/realestate, and r/cscareerquestions are way higher than r/poor, which again doesn't make the list.
If I understand it correctly, it's suggesting that a user of /r/poor is 118 times as likely to comment on /r/btc than the average user. I don't think the crypto subs being large has any significance whatsoever. If anything it just strengthens the signal when you're looking at it in that direction.
Reversing the direction doesn't mean much. It just means that users of crypto subs have stronger links elsewhere, like to investing.
If you were going to try to draw a really big conclusion from this (you shouldn't) it would be something like "a large portion of those who are poor are involving themselves with crypto," not like "being into crypto will make you poor."
> I think this is simply that crypto subreddits are big, and so if you try to find the overlap between r/poor and anything else, a big subreddit will be high on the list.
Poor people use what little money they have to purchase hope. It comes in many forms. Hope allows one to live in a future fantasy which is less painful than the present moment.
I have made a lot of money on Bitcoin, and only bitcoin. It paid for my education, my house, and my future retirement. But I knew about it from 2009 and started mining in 2011.
I'm under no illusions: the money I made from Bitcoin didn't come from nowhere. It came from people losing their savings and gambling money they shouldn't.
Well, to be fair it also came from billionaires, hedge funds and financial institutions getting in much later than you did, along with at least some genuine utility, some of which benefits people suffering in corrupt political regimes.
Commenters don’t seem to understand what the metric means. This is saying that a subscriber to r/poor is 118x more likely to engage with r/btc than a randomly chosen redditor.
It doesn’t mean that bitcoiners are more likely to be poor. It doesn’t really mean poor people are likely to be on btc either if r/poor is just not representative. But the initial statement does seem solid.
The size of the group doesn’t really impact this assuming it’s not tiny.
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