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You forgot inflationary pressure from all the "free" money. That is what really upset me the most about the 2008/etc situation. I was looking to buy a house, an
by StillBored 6y ago
You forgot inflationary pressure from all the "free" money. That is what really upset me the most about the 2008/etc situation. I was looking to buy a house, and you would have never known there was a housing crisis where I lived (Austin).
The banks were more than willing to sit on assets than actually sell foreclosed properties at market values. So while the housing prices went down slightly, your talking maybe a 10% after a decade of 10% a year increases. The "dip" didn't even last 2 years.
I myself made an offer on a forclosed/vacant house, and the bank counter offered above the listing price.
I had friends who tried to buy already forclosed houses and literally sat around for a year+ waiting for the banks to accept their offers. Eventually like me, actually buying other properties.
- chewz 6y agoI did mention pushing savers into real estate and other assets. Lots of people are flipping houses simply because thay cannot get decent returns on bank savings anymore. Same goes for professional money managers of all kinds who simply cannot provide decent returns to their customers by buying bonds like old school. So they are forced to chase yields in other risky assets. Also with bank savings everyone has an equal chance. With risky assets - richer people are priviledged with better access to higher returns (via better access to information, scale of investment, credit etc.). So disparities grow.
- pjc50 6y agoWhy are people entitled to a positive return on capital, a particular form of unearned income?
- peterwoerner 6y agoIts not some much they are entitled to it, but rather that if they don't get positive return on capital, it loses value because of inflation. Edit: spelling
- stickfigure 6y agoPeople are entitled to allocate their savings as they choose. It naturally gravitates to positive returns.