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> If not for FED chicanery, housing prices would fall precipitously to meet real demand. Maybe in some places, but I don't think that would happen in Silicon V

> If not for FED chicanery, housing prices would fall precipitously to meet real demand. Maybe in some places, but I don't think that would happen in Silicon Valley. As the article says, the population of Palo Alto doubles during work days. A lot of those people would rather live there than commute from wherever. Silicon Valley is not a creation of the Fed.

StanislavPetrov 10y ago
Where do you think VC money comes from? Massive profits from bond, equity, and real estate profits courtesy of the FED. Cheap money borrowed at 0% thanks to the FED. Some of us older people were around to see a very similar situation in the 90's (although not nearly as bad). Greenspan debuted ~0% interest rates and the Clintons fully embraced the Reaganomic/trickle-down philosophy (now called "wealth effect"). They opened the borders via NAFTA and deregulated Wall Street via Rubinomics. It all fell apart when the tech bubble burst in 2000. Instead of fixing the problem, Bush doubled down on the same broken policies, which led to the collapse of the late 2000's. Again, Obama and the FED doubled down, trying to fix the broken, cheap money policies with even more cheap money. Here we are 8 years later and markets have basically ceased to exist. Central banks own far more bonds and equities in many counties then private parties do, and they are only increasing their buying. Growth is non-existent even by the manipulated, mostly-worthless metrics employed by the central banks. The insane wealth of Silicon Valley is not only a creation of the FED, its a good barometer for how out of whack our economic system is.
- karma_vaccum123 10y ago
  And ZeroHedge assured me society would collapse in 2009...guess enough people don't subscribe to InfoWars
  - StanislavPetrov 10y ago
    Society is crumbling rather then collapsing. How long the process will take is anyone's guess, but you have your head buried deep in the sand if you don't see the deterioration.
pjmorris 10y ago
Right. It's a creation of the DoD [1]. The Fed just supplies the extra money for VC's and home loans. [1] https://steveblank.com/secret-history/ https://steveblank.com/secret-history/
crdoconnor 10y ago
>Silicon Valley is not a creation of the Fed. Silicon Valley itself isn't but the exaggerated SV house prices, exaggerated levels of VC funding and exaggerated valuations are all a function of the fed's ZIRP policy.

StanislavPetrov 10y ago

Where do you think VC money comes from? Massive profits from bond, equity, and real estate profits courtesy of the FED. Cheap money borrowed at 0% thanks to the FED. Some of us older people were around to see a very similar situation in the 90's (although not nearly as bad). Greenspan debuted ~0% interest rates and the Clintons fully embraced the Reaganomic/trickle-down philosophy (now called "wealth effect"). They opened the borders via NAFTA and deregulated Wall Street via Rubinomics. It all fell apart when the tech bubble burst in 2000. Instead of fixing the problem, Bush doubled down on the same broken policies, which led to the collapse of the late 2000's. Again, Obama and the FED doubled down, trying to fix the broken, cheap money policies with even more cheap money. Here we are 8 years later and markets have basically ceased to exist. Central banks own far more bonds and equities in many counties then private parties do, and they are only increasing their buying. Growth is non-existent even by the manipulated, mostly-worthless metrics employed by the central banks. The insane wealth of Silicon Valley is not only a creation of the FED, its a good barometer for how out of whack our economic system is.

karma_vaccum123 10y ago
And ZeroHedge assured me society would collapse in 2009...guess enough people don't subscribe to InfoWars
- StanislavPetrov 10y ago
  Society is crumbling rather then collapsing. How long the process will take is anyone's guess, but you have your head buried deep in the sand if you don't see the deterioration.

pjmorris 10y ago

Right. It's a creation of the DoD [1]. The Fed just supplies the extra money for VC's and home loans. [1] https://steveblank.com/secret-history/ https://steveblank.com/secret-history/

crdoconnor 10y ago

>Silicon Valley is not a creation of the Fed. Silicon Valley itself isn't but the exaggerated SV house prices, exaggerated levels of VC funding and exaggerated valuations are all a function of the fed's ZIRP policy.