5 ms·

Both are true. Fiscal and monetary stimulus drove financial assets owned mostly by 40+ and retirees to the moon. House prices have become more unaffordable just

by fny 5y ago

Both are true. Fiscal and monetary stimulus drove financial assets owned mostly by 40+ and retirees to the moon. House prices have become more unaffordable just as millennials (already saddled with college debt) are getting ready to buy their first homes. Inflation has eaten into real wages even with increases. We also locked up an entire generation of zoomers in a house for two years. I was all for lockdowns in early COVID since we didn't know what we were dealing with, but we kept schools closed for far, far too long.

dclowd9901 5y ago
Honestly, blame the far left. This was their totem and they’ve been staunch about it. I consider myself a democratic socialist, but planting the flag of progressives into the dirt at the line of perpetual lockdowns was a _huge_ and likely catastrophic misstep, both politically and (more importantly) societally.
- watwut 5y ago
  Apparently, majority of world is ruled by far left. Otherwise we can't explain lockdowna in other countries.
  - ErikVandeWater 5y ago
    It's not so much far left as it is authoritarian.
simplestats 5y ago
Assets going up in value isn't really a wealth transfer by itself. The buyer is just exchanging a lot more cash for an asset worth a lot more. Their wealth doesn't change overall. Rents are a different story perhaps. The unfair property taxes in California and similar states is certainly wealth transfer though, which got vastly more unfair.
- fny 5y ago
  It is an indirect transfer. Central bank balance sheet coupled with debt monetization debases fiat. That means if I worked for an hour and made $10 and your house goes up by 30%, I can buy less house while you can borrow against your house at low interest rates to buy more financial assets or even my time.
- danhak 5y ago
  Could you please elaborate on what’s unfair about property taxes in California? From what I understand California has some of the lowest property taxes in the country and Prop 13 let owners lock in their tax basis for life.
  - xyzzy_plugh 5y ago
    You just described what's unfair. Prop 13 means new owners pay for their neighbors disproportionately. That's wealth transfer.
  - bigthymer 5y ago
    Low property taxes inflate house prices. New entrants (e.g. young people) to the market have to pay these inflated prices.
- usrusr 5y ago
  It's a transfer from those who have a high fraction of their net worth in cash equivalents to those whose cash fraction is low or even negative. Nobody actually has a million dollars (well, maybe except for some who have a lot of laundering ahead of them?), but plenty of smallish "emergency funds" or "future downpayments" in deprecating savings accounts.
  - medvezhenok 5y ago
    And a transfer from those earning salaries as well, even if the salaries keep up with inflation (due to the Cantillon effect - the holders of capital will have access to the money first, so they can use it before it's "fully devalued", versus wage indexing which comes later).
astrange 5y ago
The assets went up because the US economy is healthy. This is a much better alternative than 2008 where we failed to fix deflation. Basically printing money is awesome. > Inflation has eaten into real wages even with increases. Interestingly not true for homeowners because of fixed-rate mortgages. Or people not currently purchasing a car.

by fny 5y ago

dclowd9901 5y ago

Honestly, blame the far left. This was their totem and they’ve been staunch about it. I consider myself a democratic socialist, but planting the flag of progressives into the dirt at the line of perpetual lockdowns was a _huge_ and likely catastrophic misstep, both politically and (more importantly) societally.

watwut 5y ago
Apparently, majority of world is ruled by far left. Otherwise we can't explain lockdowna in other countries.
- ErikVandeWater 5y ago
  It's not so much far left as it is authoritarian.

simplestats 5y ago

Assets going up in value isn't really a wealth transfer by itself. The buyer is just exchanging a lot more cash for an asset worth a lot more. Their wealth doesn't change overall. Rents are a different story perhaps. The unfair property taxes in California and similar states is certainly wealth transfer though, which got vastly more unfair.

fny 5y ago
It is an indirect transfer. Central bank balance sheet coupled with debt monetization debases fiat. That means if I worked for an hour and made $10 and your house goes up by 30%, I can buy less house while you can borrow against your house at low interest rates to buy more financial assets or even my time.
danhak 5y ago
Could you please elaborate on what’s unfair about property taxes in California? From what I understand California has some of the lowest property taxes in the country and Prop 13 let owners lock in their tax basis for life.
- xyzzy_plugh 5y ago
  You just described what's unfair. Prop 13 means new owners pay for their neighbors disproportionately. That's wealth transfer.
- bigthymer 5y ago
  Low property taxes inflate house prices. New entrants (e.g. young people) to the market have to pay these inflated prices.
usrusr 5y ago
It's a transfer from those who have a high fraction of their net worth in cash equivalents to those whose cash fraction is low or even negative. Nobody actually has a million dollars (well, maybe except for some who have a lot of laundering ahead of them?), but plenty of smallish "emergency funds" or "future downpayments" in deprecating savings accounts.
- medvezhenok 5y ago
  And a transfer from those earning salaries as well, even if the salaries keep up with inflation (due to the Cantillon effect - the holders of capital will have access to the money first, so they can use it before it's "fully devalued", versus wage indexing which comes later).

astrange 5y ago

The assets went up because the US economy is healthy. This is a much better alternative than 2008 where we failed to fix deflation. Basically printing money is awesome. > Inflation has eaten into real wages even with increases. Interestingly not true for homeowners because of fixed-rate mortgages. Or people not currently purchasing a car.