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But housing costs money. If you're a homeowner, if you bought a house for $250k in 2019 vs. a homeowner who bought an identical house for $300k in 2021, its pre

But housing costs money. If you're a homeowner, if you bought a house for $250k in 2019 vs. a homeowner who bought an identical house for $300k in 2021, its pretty hard to argue the second homeowner isn't comparatively worse off. Of course, houses have to be maintained. At least where I am, the cost of plumbers, electricians, HVAC, etc. have exploded in the last 18 months. Renters are a much more straightforward case. The costs of housing (i.e. the costs of purchasing and maintaining the asset) are passed on to them in the form of rent increases.

lkrubner 5y ago
While your concerns are valid, that is simply not the definition of consumer inflation. Houses are not consumer goods, they are assets, like stocks on the stock market. If the stock market goes up 2%, we do not make a habit of saying "Terrible news today, the stock market suffered 2% inflation."
- notch656a 5y ago
  >we do not make a habit of saying "Terrible news today, the stock market suffered 2% inflation." If the real value of the underlying equities/assets of the market stay the same but the nominal price goes up 2%: As a cash buyer I would absolutely say "terrible news today, the stock market suffered 2% price inflation today." Just because the government doesn't put that into the "consumer inflation" figures doesn't mean it doesn't look like inflation to me as someone who may desire to own certain equities.
  - lkrubner 5y ago
    "If the real value" The word "real" has no meaning in this sentence unless you've first developed a concept of consumer inflation that is separate from asset values increasing. If you say that asset "inflation" should be a component of the consumer inflation that the government measures, and therefore consumer inflation includes the increase in the value of homes, then the word "real" has no meaning. You cannot say "Houses went up 5% but inflation also went up 5%" if the 5% increase in homes is already counted in the 5% inflation. You are mushing these concepts together and creating a conceptual mess.
    - notch656a 5y ago
      >If you say that asset [price] "inflation" should be a component of the consumer inflation First of all I never said that, because by definition they are two separate things. Asset price inflation refers to a fixed quantity of currency buying less and less real assets. Consumer inflation refers to a fixed quantity of currency buying less and less of the basket of consumer goods and services. You keep confusing yourself by sometimes mushing the concepts inflation, asset price inflation, and consumer inflation and then getting upset when one doesn't fit neatly into the other. You are mushing these concepts together and creating a conceptual mess. You can play this disingenuous game all day where you mix the 3 concepts around, and yet at the end of the day asset price inflation will still be real.
      - lkrubner 5y ago
        "buying less and less real assets" What is a real asset? If by "real" you mean "adjusted for inflation" then, again, you are double counting the inflation. If by "real" you mean "an object with a clear category and a clear value" then I'm curious how you would derive the clear category and the clear value? If one person says "I hate that house, I would only pay $300k for it" and another person says of the same house "I love that house, I would pay $600k for it" then who is correct? If you want to have a sane conversation about this, I would suggest that you stop using the word "real." Use "inflation adjusted" if you mean that, and then use "actual" or "countable" when you mean those things. About this: "You keep confusing yourself by sometimes mushing the concepts inflation, asset price inflation, and consumer inflation and then getting upset when one doesn't fit neatly into the other." I am not upset with you, nor did I say anything to suggest that I was upset with you. I'm simply pointing out that you don't seem to understand the words that you are using. Also, I've avoided bringing politics into this, but it might be worth thinking of some of the notorious incidents of hyper-inflation, the political effects it had, and how such effects are simply not rational or possible or connected to increasing nominal prices for assets. I wrote about the late Soviet era hyper-inflation here: https://demodexio.substack.com/p/the-struggle-to-save-the-soviet-economy-167 https://demodexio.substack.com/p/the-struggle-to-save-the-so...
        5y ago
- wonderwonder 5y ago
  Sure, but when I sell 100 shares of IBM I am not forced to buy another 100 shares. When I sell my home I very much have to replace it.
  - lkrubner 5y ago
    That is a valid issue that you raise, but unrelated to the conceptual issue of whether an increase in the nominal price of an asset can be coherently understood to be a form of "inflation." Hopefully everyone on Hacker News is smart enough to know that housing has special features that are different from other asset classes.
    - wonderwonder 5y ago
      Probably most people, I am questionable :)
- xibalba 5y ago
  Fair enough and understood. The problem is these numbers get reported in headlines as “inflation”. People are experiencing greater than 6% inflation in their pocketbooks. So I suppose I’m objecting to something different from what you’re talking about.

lkrubner 5y ago

While your concerns are valid, that is simply not the definition of consumer inflation. Houses are not consumer goods, they are assets, like stocks on the stock market. If the stock market goes up 2%, we do not make a habit of saying "Terrible news today, the stock market suffered 2% inflation."

notch656a 5y ago
>we do not make a habit of saying "Terrible news today, the stock market suffered 2% inflation." If the real value of the underlying equities/assets of the market stay the same but the nominal price goes up 2%: As a cash buyer I would absolutely say "terrible news today, the stock market suffered 2% price inflation today." Just because the government doesn't put that into the "consumer inflation" figures doesn't mean it doesn't look like inflation to me as someone who may desire to own certain equities.
- lkrubner 5y ago
  "If the real value" The word "real" has no meaning in this sentence unless you've first developed a concept of consumer inflation that is separate from asset values increasing. If you say that asset "inflation" should be a component of the consumer inflation that the government measures, and therefore consumer inflation includes the increase in the value of homes, then the word "real" has no meaning. You cannot say "Houses went up 5% but inflation also went up 5%" if the 5% increase in homes is already counted in the 5% inflation. You are mushing these concepts together and creating a conceptual mess.
  - notch656a 5y ago
    >If you say that asset [price] "inflation" should be a component of the consumer inflation First of all I never said that, because by definition they are two separate things. Asset price inflation refers to a fixed quantity of currency buying less and less real assets. Consumer inflation refers to a fixed quantity of currency buying less and less of the basket of consumer goods and services. You keep confusing yourself by sometimes mushing the concepts inflation, asset price inflation, and consumer inflation and then getting upset when one doesn't fit neatly into the other. You are mushing these concepts together and creating a conceptual mess. You can play this disingenuous game all day where you mix the 3 concepts around, and yet at the end of the day asset price inflation will still be real.
    - lkrubner 5y ago
      "buying less and less real assets" What is a real asset? If by "real" you mean "adjusted for inflation" then, again, you are double counting the inflation. If by "real" you mean "an object with a clear category and a clear value" then I'm curious how you would derive the clear category and the clear value? If one person says "I hate that house, I would only pay $300k for it" and another person says of the same house "I love that house, I would pay $600k for it" then who is correct? If you want to have a sane conversation about this, I would suggest that you stop using the word "real." Use "inflation adjusted" if you mean that, and then use "actual" or "countable" when you mean those things. About this: "You keep confusing yourself by sometimes mushing the concepts inflation, asset price inflation, and consumer inflation and then getting upset when one doesn't fit neatly into the other." I am not upset with you, nor did I say anything to suggest that I was upset with you. I'm simply pointing out that you don't seem to understand the words that you are using. Also, I've avoided bringing politics into this, but it might be worth thinking of some of the notorious incidents of hyper-inflation, the political effects it had, and how such effects are simply not rational or possible or connected to increasing nominal prices for assets. I wrote about the late Soviet era hyper-inflation here: https://demodexio.substack.com/p/the-struggle-to-save-the-soviet-economy-167 https://demodexio.substack.com/p/the-struggle-to-save-the-so...
      - 5y ago
wonderwonder 5y ago
Sure, but when I sell 100 shares of IBM I am not forced to buy another 100 shares. When I sell my home I very much have to replace it.
- lkrubner 5y ago
  That is a valid issue that you raise, but unrelated to the conceptual issue of whether an increase in the nominal price of an asset can be coherently understood to be a form of "inflation." Hopefully everyone on Hacker News is smart enough to know that housing has special features that are different from other asset classes.
  - wonderwonder 5y ago
    Probably most people, I am questionable :)
xibalba 5y ago
Fair enough and understood. The problem is these numbers get reported in headlines as “inflation”. People are experiencing greater than 6% inflation in their pocketbooks. So I suppose I’m objecting to something different from what you’re talking about.