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I hear agreement that the economy is good, but also that jobs are paying less for more work and that income inequality is larger than ever. At the same time, th

I hear agreement that the economy is good, but also that jobs are paying less for more work and that income inequality is larger than ever. At the same time, the housing market where I live is absolutely exploding. I feel like I'm missing something about the real condition of the economy...

trentnix 7y ago
Politics infests everything, so inevitably all economic news is propaganda to be twisted however is deemed appropriate. When unemployment is high, the house organs lament the poor people out of work. When unemployment is low, the house organs lament that it’s the wrong kind of employment. And always, the problems can be solved with putting my candidate in charge with access to a lot of other people’s money.
- Twixes 7y ago
  Well, maybe it's just that these are actual problems felt by many people and things need to be done about them. The problem is, rarely are things actually done (say, about housing affordability, healthcare accessibility or economic inequality), mostly because doing things endangers interests of privileged groups (property owners, the insurance industry, executives etc.)
simple_phrases 7y ago
> At the same time, the housing market where I live is absolutely exploding That's because the US housing market is open to the richest people around the world who are looking for a place to store value. US property rights protect value better than property rights in China.
resfirestar 7y ago
Everyone has an agenda but be especially careful of real estate as an economic barometer. There’s so much speculation going on that the level of distortion can often seem criminal in retrospect. A recent example: Manhattan developers seem to be keeping thousands of new, unsold condos off the market. I don’t think it’s difficult to imagine why. https://www.bloomberg.com/news/articles/2020-01-06/manhattan-s-flood-of-new-condos-could-take-six-years-to-sell https://www.bloomberg.com/news/articles/2020-01-06/manhattan...
- AdrianB1 7y ago
  It is extremely simple to see why: flooding the market will lower the prices and reduce the profits, waiting and selling at high price can be more profitable, it's a simple math comparison between the options.
- majos 7y ago
  Re: unsold condos, anyone want to try explaining how withholding stock makes sense? I understand flooding the market would depress prices further, but I don’t understand what market would buy up all this stock. If these units can’t sell in what seems to be a nicely growing market, isn’t it going to be a long time before they sell at all? Like, so long that just sitting on them and paying taxes doesn’t make sense?
  - swagasaurus-rex 7y ago
    The calculation: Prices will skyrocket from lack of supply more quickly than the taxes paid on the units. Development and renting it out locks you into contracts where you can't flip as quickly (low liquidity). So you don't develop or use the land, just wait for your investment to accrue.

trentnix 7y ago

Politics infests everything, so inevitably all economic news is propaganda to be twisted however is deemed appropriate. When unemployment is high, the house organs lament the poor people out of work. When unemployment is low, the house organs lament that it’s the wrong kind of employment. And always, the problems can be solved with putting my candidate in charge with access to a lot of other people’s money.

Twixes 7y ago
Well, maybe it's just that these are actual problems felt by many people and things need to be done about them. The problem is, rarely are things actually done (say, about housing affordability, healthcare accessibility or economic inequality), mostly because doing things endangers interests of privileged groups (property owners, the insurance industry, executives etc.)

simple_phrases 7y ago

> At the same time, the housing market where I live is absolutely exploding That's because the US housing market is open to the richest people around the world who are looking for a place to store value. US property rights protect value better than property rights in China.

resfirestar 7y ago

Everyone has an agenda but be especially careful of real estate as an economic barometer. There’s so much speculation going on that the level of distortion can often seem criminal in retrospect. A recent example: Manhattan developers seem to be keeping thousands of new, unsold condos off the market. I don’t think it’s difficult to imagine why. https://www.bloomberg.com/news/articles/2020-01-06/manhattan-s-flood-of-new-condos-could-take-six-years-to-sell https://www.bloomberg.com/news/articles/2020-01-06/manhattan...

AdrianB1 7y ago
It is extremely simple to see why: flooding the market will lower the prices and reduce the profits, waiting and selling at high price can be more profitable, it's a simple math comparison between the options.
majos 7y ago
Re: unsold condos, anyone want to try explaining how withholding stock makes sense? I understand flooding the market would depress prices further, but I don’t understand what market would buy up all this stock. If these units can’t sell in what seems to be a nicely growing market, isn’t it going to be a long time before they sell at all? Like, so long that just sitting on them and paying taxes doesn’t make sense?
- swagasaurus-rex 7y ago
  The calculation: Prices will skyrocket from lack of supply more quickly than the taxes paid on the units. Development and renting it out locks you into contracts where you can't flip as quickly (low liquidity). So you don't develop or use the land, just wait for your investment to accrue.