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It’s a matter of different incentives. The Fed is trying to reduce prices in asset markets. Asset prices growing faster than our ability to make things is a s
by RC_ITR 4y ago
It’s a matter of different incentives.
The Fed is trying to reduce prices in asset markets.
Asset prices growing faster than our ability to make things is a sure-fire cause of inflation (more stock-based billionaires chasing the same amount of houses makes all house prices go up, as an extreme example).
Blackrock just wants to have as many assets under management as possible (that’s how they make money), and one easy way to goose that number is to have your existing assets go up in price (and vice versa for falling prices).
So yeah, Blackrock is rightly mad at the Fed and will probably say a lot of mean things about them.
Doesn’t mean the Fed isn’t doing the right thing though.
- nly 4y agoIt's not billionaires pushing up house prices but the middle class .. like me I'm in the top 1% of UK salaried income and a family home is not affordable in an area I'm willing to commute from. To buy a family home I'd be paying almost as much as a whole year of the UK annual after-tax s just in stamp duty (transaction tax). Things have gotten out of hand.
- jakeinspace 4y agoI don’t believe you’re middle class mate. Though I realize that the British definition is more grounded in upbringing and family history than the American usage.
- osrec 4y agoUpper middle class may be more accurate.
- cjbgkagh 4y agoIn my definition salaried people are middle class, high salary is upper middle. Not having to work to maintain their lifestyle is the start of the upper classes.
- jakeinspace 4y agoDoes that make a retiree upper class? Plenty of those I consider middle/upper middle class reach the ability to live off interest by age 60
- simonh 4y agoI imagine in this system a retiree is the class they achieved professionally in employment. Generally upper middle class is where family background begins to be a major factor. It generally means coming from a traditionally well off and educated family, with prestigious roles at the pinnacle of a hierarchy (prominent politician, judge, dean of a university, general, etc), public school education, and perhaps ancestral connections to nobility.
- cjbgkagh 4y agoIt's more that in my view not having to work is necessary but possibly not sufficient for being a member of the upper class. I think by that point it depends on which social circles you run with.
- polotics 4y agoThe British term "middle-class" is weird, because "upper-class" pretty much refers to nobility. Unless your ancestors have a nice pride of place in the Domesday-book, you are unlikely to ever consider yourself or be considered "upper"...
- mistrial9 4y agoif a person with access to much more credit than you, and has more cash than you, is competing with you to get a house when there are not many houses, how can you be the cause of the increase in price? secondly, if the entire house market is so over-priced that only people that have a house to sell, and new cash, and substantial access to credit are the ones getting any house at all, how is the cause of the price rise the buyer? thirdly, if the total capital in the system has been multiplied by QE and network effects on assets, such that you the middle-class buyer are not able to afford even a bid, how is that the result of the middle-class house buyer?
- majormajor 4y agoTop 1% of income isn't middle class. Lot of folks in the top 1% who have a lot of equities investments - those get inflated, makes it easier to borrow more, pours gas on bidding wars.
- Scoundreller 4y agoArguably, if you have to go to work for money and need loans to buy shelter, you’re not upper class.
- akiselev 4y agoI still think it's useful to separate out the working middle/upper class from the true "aristocracy" (for lack of a better word). A professional in the middle class can save up and buy property until they can live off passive income to become upper class but that's a different class from the people who can fund their life styles through financial arbitrage by the sheer size of their wealth.
- 6510 4y agoO god, I never realized loans are a kind of charity. Reading myself write it it sounds sarcastic but nearly everyone is so damn poor they need someone to support them just to have a roof over their heads. Shelter is exactly the word in how temporarily it all is. You show documents to demonstrate how likely it is you will be able to pay for it some time in the future. Odds that will happen are not good at all. We also get food subsidies or we wouldn't be able to eat properly. Oh, and we also do all of the work on this planet. We do it to demonstrate how well behaved and civilized we are. Very obedient subjects.
- nly 4y agoHigh income has nothing to do with class or wealth.
- Red_Leaves_Flyy 4y agoExhibit A: Elon musk. The fool has neither wealth nor class.
- deleted 4y ago[deleted]
- RC_ITR 4y ago>as an extreme example
- wwweston 4y agoBlackrock is, of course, free to start making things, or to increase their assets by buying from people who are.
- FridgeSeal 4y agoPpppphhh meaningfully contribute instead of just leeching out passing value like some kind of parasite??? What a crazy idea.
- Scoundreller 4y agoCan’t do A in a suit, and can’t do B when outflows are your problem and nobody will loan you their money for free to buy more stuff.