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To me, this isn't a story about gentrification. It's more of a story about the modern American job, housing, financial, and social status markets. 1. The job

To me, this isn't a story about gentrification. It's more of a story about the modern American job, housing, financial, and social status markets. 1. The job market, especially in media jobs, has changed into one where you can be fired at any time. Similarly, forty years ago, someone who had a good media job would not have felt safe making such inflammatory (right or wrong) statements. 2. American housing markets have adjusted higher to essentially consume all of the practical discretionary income of renters and buyers. A lot of this has to do with the securitization of these obligations, and the corresponding loosening of credit requirements. If the rope that the bank or the landlord is willing to give you increase, it's not just a personal decision about how much risk you're willing to take, because it affects the loans and leases everyone else in the market gets. Just because your neighbor is taking out a crazy loan he can't afford if anything goes wrong doesn't mean he isn't pushing up the housing prices just as much as if he could do it comfortably. 3. The financial markets have become much more sophisticated on one hand, but also much less local and much shorter term focused. If 10% of borrowers default, that's not necessarily a problem as long as the cost they cause covers the profit from the others. If the 10% cause major social problems, the holder of the CDO in Qatar has no idea, and wouldn't care if he did. 4. The increased availability of credit, and the increased willingness of markets to give credit to risky borrowers has forced people to extend themselves to the max in order to compete for social status. If your friend has a BMW and a big house even though he's practically bankrupt, you are pushed into doing the same thing. The girls at the next table at the bar have no idea that he's is being fiscally irresponsible, they just know that he has a cool car and a nice house.

discoursism 9y ago
> The increased availability of credit, and the increased willingness of markets to give credit to risky borrowers has forced people to extend themselves to the max in order to compete for social status. This is optional, though. If you opt in to it, that's somewhat on you. Granted that our social systems could be improved so that natural human tendencies push people toward right actions. However, I think the injustice is far more severe in cases where there's no out that's within a person's power to reasonably grasp. And "the girls at the next table in the bar," don't know about your friend's car or house, unless your friend is an insufferable jerk who carries pictures of his ride in his wallet. And they likely don't care that much either way.
- cameldrv 9y ago
  The kind of girls you want to settle down with can see through that shit, but it doesn't change the short term problem. The 25 year old with the BMW doesn't buy it because he has some love affair with German engineering, he buys it because it's going to get him girls. America is the land of risk takers and optimists. It's full of people who know how to get in on the next big thing and are going to work to grab it. This all works great as long as credit isn't too available, and when the next big thing isn't as big as someone thought, he can always get a job at the GM plant. The problem we have now is that he gets overextended on his securitized mortgage and has to take a job for $11 at Wal-Mart.
- phil21 9y ago
  > This is optional, though. If you opt in to it, that's somewhat on you. Sort of. Until you get into asset price inflation - I sure am not looking for anything fancy or social-signaling for my housing, but due to everyone taking out absurd 30yr mortgages and financing to the hilt I'm likely paying 2-3x what they would be if such financial instruments did not exist. So you get to play at least some ball whether or not any of those things matter to you.

discoursism 9y ago

> The increased availability of credit, and the increased willingness of markets to give credit to risky borrowers has forced people to extend themselves to the max in order to compete for social status. This is optional, though. If you opt in to it, that's somewhat on you. Granted that our social systems could be improved so that natural human tendencies push people toward right actions. However, I think the injustice is far more severe in cases where there's no out that's within a person's power to reasonably grasp. And "the girls at the next table in the bar," don't know about your friend's car or house, unless your friend is an insufferable jerk who carries pictures of his ride in his wallet. And they likely don't care that much either way.

cameldrv 9y ago
The kind of girls you want to settle down with can see through that shit, but it doesn't change the short term problem. The 25 year old with the BMW doesn't buy it because he has some love affair with German engineering, he buys it because it's going to get him girls. America is the land of risk takers and optimists. It's full of people who know how to get in on the next big thing and are going to work to grab it. This all works great as long as credit isn't too available, and when the next big thing isn't as big as someone thought, he can always get a job at the GM plant. The problem we have now is that he gets overextended on his securitized mortgage and has to take a job for $11 at Wal-Mart.
phil21 9y ago
> This is optional, though. If you opt in to it, that's somewhat on you. Sort of. Until you get into asset price inflation - I sure am not looking for anything fancy or social-signaling for my housing, but due to everyone taking out absurd 30yr mortgages and financing to the hilt I'm likely paying 2-3x what they would be if such financial instruments did not exist. So you get to play at least some ball whether or not any of those things matter to you.