Post-Corona Economy

[Cakedaddy]

Good question. I'd bet it's higher now than in years past mainly because I think so many wannabe home buyers are stuck waiting out this nonsense. Buying now means:
1. You're an idiot.
2. You're rich and can eat the loss.
3. You are forced into a move for some reason. (Job, family issue, etc.)

4. You are going to be in your house long enough that paying extra now won't hurt as much because the 'loss' will be spread out. That's assuming there will be a loss. Maybe prices keep going up. But I agree with you that we are in another bubble. I believe prices and rates will go back down. I have no evidence to support this. I would just put my $10 on "stuff will go down". I refer you to my example. I bought at 7.5, refi'ed a few years in down to 3ish. At that time, we also turned it into a 15 year instead of 30 because our payment didn't go up that much after the rates went so low.

I don't think buying now, long term, is stupid. You buy now and these three things could happen:
1. Rates/prices continue to rise. Good thing you got in.
2. Rates/prices stagnate. No need to stay out. This is where things are.
3. Rates/prices go down. Refi and take advantage of the savings. Stay in the house long enough, price goes back up.
4. I guess there's a 4. One goes up, other goes down. Again, long term, damage is minimal, or you get the best of both worlds.

No, adults should not be in minimum wage jobs.

I say this all the time. That being said, there ARE some people that are not capable of more. And those are the people I don't mind public funds supporting. Again, stressing 'capable'. Not, 'choosing not to'.

I am so fucking over "this side" and "that side". They both suck ass and neither does shit for us. If you truly believe X is better than Y, you're in a cult or monumentally oblivious to all evidence proving you are wrong.

Me: Do you want me to punch you on the right side, or the left side of your face?
You: I know you're right handed, so hit me on my right side because it won't be as hard.
Me: *walks behind you and punches you on the right side of your face with my right hand*

Picking one because it 'sucks less than the other' is stupid. And, if you're not paying attention, they'll figure out a way to hit you just as hard.

How can you say "Don't return your carts", but also "Pay whatever it costs" in the same breath? Ok, blame someone for self-checkout for returning their cart, but it's your fault prices are so high.

There's a difference between a long term investment, like a house that can recover or keep going up in value, and a candy bar for right now. I will buy the house and know/believe strongly, that I will see a return on that investment. I don't buy the candy bar because I don't want to support that price increase with diminishing returns.

incomes need to climb around 55% for housing to become affordable again.

Income being "up" doesn't mean shit if it isn't keeping pace with everything else, and it's not.

You even said 'economists think the house prices are bullshit'. Housing is in a bubble again. Artificially inflated. You can't pick one thing (granted, a big one) out of the economy and apply it to everything. "People can't buy houses, so EVERYTHING is fucked". There are things that are going up faster than wages, things that are going up slower than wages. I would argue, with no supporting evidence , that normal living expenses are not going up faster than wages. Housing is experiencing a short term anomaly (minimal long term affect) that's lasting a long time (short term it sucks because there are so many people watching, waiting for it to end). Housing being up right now has NOTHING to do with inflation, wages, etc.

[Leisher]

If you want lower prices, you have to reduce demand somehow.

Demand IS down right now, but prices aren't moving. Ok, they are SLOWLY moving down, but I think a lot of it is because the people holding the inventory don't want to take losses. That's a problem. That's where corporations owning a lot of houses is bad because they can afford to sit on them for a lot longer than a citizen.

I mean, we already do it. Why not more?

Because it doesn't work. There's this thing called humanity that always gets in the way.

Why would anyone let money trickle down? "Greed is good" "invisible hand" People rarely like to part with their money.

Mr. Gecko, the idea was that spending money to make even more money is where the money would flow. It hasn't worked. Again, humanity gets in the way. That's why any system needs safeguards to block people from being people.

How are people? If getting pussy required you to be bankrupt nobody would be rich.

High corporate taxes, high individual tax rates for rich, and stronger unions. Reaganomics attacked all 3.

We should absolutely tax corporations far, far more. There should never be a world where Amazon or Google pay $0 in taxes.

Not sure about the high tax rates for individuals. Let's first eliminate every conceivable loophole and then see where we're at first.

Fuck unions. Fuck unions to the sun. Unions are the poster boy of corruption and abuse. Unions are a great concept, like Reaganomics, but the execution is dogshit every time.

Yeah, it releases carbon into the air, like any other fossil fuel, but much cleaner than coal, etc.

Gas>coal, so obviously let's ban gas. Dumb.

Have we? And, it's inbetween, thus the name. The people in those societies sure seem to like it.

No, that's why I'm saying we should.

And not all those people in those societies like it. There is a spectrum and misinformation pushed by people who want to take the same power here. Also, one could argue that those countries have become soft, lazy, and complacent.

Incomes have gone up, and I say it, because it's true.

Incomes can go up, but still not be where they should be. That was my point.

Don't confuse houses with housing. House affordability is what that is talking about. Rent prices have actually gone down this year, for example, and are not up 55%.

Rent going down is awesome, but not awesome. The American Dream is a house, not a two bedroom on the South Side of Chicago.

I'm not saying everything is fine. I'm saying things are generally fine, and there are definitely places where people are feeling pain economically. But no one's trying to solve it.

I don't think things are generally fine. I can understand why you say that, but I think we're closer to a notch below fine. Maybe like "generally meh".

And you are correct. Nobody is trying to fix shit because everyone with money and power is too focused on themselves.

[Leisher]

Dammit, just saw Cake's...

[Leisher]

You are going to be in your house long enough that paying extra now won't hurt as much because the 'loss' will be spread out. That's assuming there will be a loss. Maybe prices keep going up. But I agree with you that we are in another bubble. I believe prices and rates will go back down. I have no evidence to support this. I would just put my $10 on "stuff will go down".

And this is exactly why you would be stupid to buy now. Everyone is expecting the bubble to burst and prices to plunge.

I say this all the time. That being said, there ARE some people that are not capable of more. And those are the people I don't mind public funds supporting. Again, stressing 'capable'. Not, 'choosing not to'.

No argument.

Me: Do you want me to punch you on the right side, or the left side of your face?
You: I know you're right handed, so hit me on my right side because it won't be as hard.
Me: *walks behind you and punches you on the right side of your face with my right hand*

Picking one because it 'sucks less than the other' is stupid. And, if you're not paying attention, they'll figure out a way to hit you just as hard.

Yep.

There's a difference between a long term investment, like a house that can recover or keep going up in value, and a candy bar for right now. I will buy the house and know/believe strongly, that I will see a return on that investment. I don't buy the candy bar because I don't want to support that price increase with diminishing returns.

You ever hear about the preacher in NO during Katrina who believed God would save him? It's a joke, but it applies here. Belief means nothing when every expert is showing you all of these traditional models saying the market will tank and whatever you buy will lose value.

You even said 'economists think the house prices are bullshit'. Housing is in a bubble again. Artificially inflated. You can't pick one thing (granted, a big one) out of the economy and apply it to everything. "People can't buy houses, so EVERYTHING is fucked". There are things that are going up faster than wages, things that are going up slower than wages. I would argue, with no supporting evidence , that normal living expenses are not going up faster than wages. Housing is experiencing a short term anomaly (minimal long term affect) that's lasting a long time (short term it sucks because there are so many people watching, waiting for it to end). Housing being up right now has NOTHING to do with inflation, wages, etc.

Just the best example to use to discuss the people's current state. In no way was I saying it's the only indicator.

People cannot afford to buy food and gas or pay rent and eat. Granted not all, but it's true. People are struggling. Even the big MSM outlets have done stories on this lately.

Remember when any American family could afford everything on one income? Remember that the company would have full benefits and a pension? That didn't all disappear because of inflation or Reaganomics.

[TheCatt]

People cannot afford to buy food and gas or pay rent and eat.

Their waistlines say otherwise.

[GORDON]

Does taxing a company/corporation ever lead to them paying the tax, or do the cost of their good and service increase and consumers pay the tax?

How about we tax the profits/whatever of the income people make. Drop corporate tax to zero, let prices drop for consumers (maybe), and just tax the shareholders profiting from it. If the company has net profits of, say, 28%, then 28% is spread out amongst everyone who made dividends from owning that company stock. No flat rate, just tie it to profits. The tax money comes out of the back end, and not up front when they can just up the prices to compensate.

And none of that cheesy shit the insurance companies did with obamacare, when they had their profits capped: they went on a new construction binge, to fold hide it back into the company. In case you wondered why so many hospitals expanded that year.

[Cakedaddy]

And this is exactly why you would be stupid to buy now. Everyone is expecting the bubble to burst and prices to plunge.

Again, think long term. If you are going to be in there for 5+ years, you'll recover anything you lose.

Demand IS down right now

I disagree. Even you talk about all the people that want to buy a house, but can't. There are a fuck ton more people wanting to buy, than there are people wanting to sell. I think prices will go down very slowly as people buy on the way down. This bubble won't burst. It will slowly lose air back to where it should be. It's going to be a long wait. Unless there's a recession. Then it might burst.

Remember when any American family could afford everything on one income?

No. But I've seen evidence of it in movies and tv shows. Even my grandparents were two income homes.

Fuck unions. Fuck unions to the sun. Unions are the poster boy of corruption and abuse. Unions are a great concept, like Reaganomics, but the execution is dogshit every time.

Oh ya. This. Unions are the new corporation fucking over their minions while the upper execs get wealthy. Unions use workers and are just as corrupt as any corporation they are 'fighting against'. Unions are a multi billion dollar business that buys it's Washington favors just as much as any republican corporation. Top 3 execs at UAW made over $20 million each, according to the Internet.

[Leisher]

People cannot afford to buy food and gas or pay rent and eat.

Their waistlines say otherwise.

This is the best comment so far.

Does taxing a company/corporation ever lead to them paying the tax, or do the cost of their good and service increase and consumers pay the tax?

Fair question?

Again, think long term. If you are going to be in there for 5+ years, you'll recover anything you lose.

I disagree. I say that having lost money on my first house and watching shit crash. I don't want to buy and be trapped just trying to hold on to get my money back, which may or may not happen. Too many variables for you to definitively say "you WILL get your money back".

I disagree. Even you talk about all the people that want to buy a house, but can't. There are a fuck ton more people wanting to buy, than there are people wanting to sell. I think prices will go down very slowly as people buy on the way down. This bubble won't burst. It will slowly lose air back to where it should be. It's going to be a long wait. Unless there's a recession. Then it might burst.

We will see. Stay tuned for the end of this response.

Even my grandparents were two income homes.

Not mine or my wife's, but perhaps they were older?

Jamie Dimon says prep for recession.

[TheCatt]

Fair question?

It's complicated.

Jamie Dimon says prep for recession.

That's what bond prices have been saying lately. They may be right, but people have been calling for recessions every year for a while now. So who knows, but things are definitely slowing down finally.

Not mine or my wife's, but perhaps they were older?

My granddads were both engineers, so single income. My dad was a doctor, so single income... I work in software, so single income...

Houses are not investments.

[Leisher]

My granddads were both engineers, so single income. My dad was a doctor, so single income... I work in software, so single income...

Good point. My maternal grandfather was a plant manager. My paternal grandfather worked for the mob. My wife's maternal grandfather was a pharmacist. Her paternal grandfather was an engineer. I make adult films with little people...oops, I mean, I'm in IT.

Now, depending on where you live, number of kids, how big of a home, lifestyle, etc. not all of those jobs would be enough.

Houses are not investments.

Not unless you buy one that happens to be on land a developer needs.

[Cakedaddy]

Houses are not investments.

Why not? We've done pretty well with the properties we've bought.

Better percentage return than our mutual funds. Which is a question I've been meaning to ask. . . what kind of returns are people seeing on their retirement funds? I have NOT been impressed with how ours have been doing.

[TheCatt]

Houses are not investments.

Why not? We've done pretty well with the properties we've bought.

Better percentage return than our mutual funds. Which is a question I've been meaning to ask. . . what kind of returns are people seeing on their retirement funds? I have NOT been impressed with how ours have been doing.

90% rule. Not investments for most people.

Historically they appreciate about 1% per year in real terms, obviously last 3 years different

[GORDON]

I think this is the last word on the subject, on page 69.

Screenshot 2023-11-30 180238.jpg

Checkmate.

[TheCatt]

https://www.cnbc.com/2023/12/01/us-trea ... tlook.html

Fed: We may not be cutting rates yet.

Bonds: Rates plummet. Down to 4.20 on the 10 year. 2 year down to 4.55%.

Pretty dramatic drops.

The rates dropping like that are kind the opposite of what one would expect from the Fed's statement. Implies the market is increasing the risk/chance of economic slowdown.

[TheCatt]

10 year is down to 4.10 from a high above 5.00; Oil is below $70/barrel; Natural Gas is $2.50...

Walmart CEO uses the deflation word.

[GORDON]

Gasp, with a capital-D?

Who could have predicted that?

[TheCatt]

Gasp, with a capital-D?

Who could have predicted that?

Deflation, not depression. And only in isolated areas of the economy.

[Leisher]

[TheCatt]

That's certainly on the high side of predictions. 3 month to 12 month bonds still say otherwise. But after that rates drop pretty significantly compared to 3 months ago.

[Leisher]

Consumers aren't spending like they used to.

Tech startups had a shitty 2023 as investors weren't spending either.

Dollar General joins Costco and Walmart on rethinking self checkout.