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A key problem in Sweden -- besides the weird interaction of privatization and legacy over-regulation -- is that the current inflation and rising interest rates
by timkam 4y ago
A key problem in Sweden -- besides the weird interaction of privatization and legacy over-regulation -- is that the current inflation and rising interest rates break the social contract: a relatively even salary distribution allowed many people to have a solid middle-class life style, recently albeit with never-ending mortgages. Now, the interest rates are too high for these mortgages to be even superficially sustainable, people have less money at hand to pay for them, and there is no political will to relief the working and middle class, which means many will slide down the social ladder. As an immigrant living in Sweden I fear that the country will soon be pretty unattractive to live in for most 'internationals' who have a choice.
- moltar 4y agoI think you could say exactly the same story about Canada. And imagine many other countries soon. Interest rates will spoil the party.
- brailsafe 4y agoCanada is fucked
- f1shy 4y agoAnd Germany, ans so many other countries
- theshrike79 4y agoThe difference in Sweden is that they gave out ridiculously long loans for housing. Like 60-100 years. The kind that was never meant to be paid back.
- jokethrowaway 4y agoIt's the same everywhere, not only in Sweden. What a surprise. The government got your taxes AND screwed you with inflation over time. Then COVID happened and they had to print more, postponing and aggravating the crisis. Now it's time to pay and nobody will take the blame. When are people going to rebel?
- varispeed 4y ago[flagged]
- oblio 4y agoHow does this work? We've had a decade of low inflation, low interest rates. Now we have high inflation, high interest rates? Which one was architected? It can't really be both.
- sumedh 4y ago> Which one was architected? Low interest and money printing to bail out big companies and their CEO buddies. Most of that money printing goes into assets bubbles.
- tptacek 4y agoThis is a conspiracy theory about a global suit-and-tie version of TED Talks whose members consistently underperform the S&P 500. The World Economic Forum sounds important, like the IMF is, but it's nothing at all like that. It's a convention, in the ComicCon sense, that happens to be frequented by high-status people, because high-status people go where other high-status people go. Ironically, talking about them as if they're engineering the future of Europe is probably the only thing anybody can possibly do to give them any kind of impact. The solution to housing affordability is to build more housing. It's not complicated. But people who own housing today have a vested interest in preventing new housing development.
- varispeed 4y ago> It's a convention, in the ComicCon sense This is a common way people use to rationalise it. But how do you think decisions are made when there is group of people where each one has a part to play to execute a policy? The word you are looking for is a meeting. People meet, discuss, share concerns and agree plan. At this level, this is not something you can do over a Zoom call as you don't know who may be in the room and there are other security risks to consider. So they organise ComicCon, in a semi-open fashion. After all, what pleb like me and you can do about it? Even if you write online, like I do, you can see I am getting dismissed, often ridiculed and often ad hominem follow as well. They can totally do it and there is nothing people can do about it, so they don't even have to hide that much.
- holoduke 4y agoSame in every single rich country in Europe. Same story with housing issues, interest etc.
- Aeolun 4y agoPretty much yeah. At least housing in the Netherlands gets rapidly more expensive with no correspondant increase in wages.
- listenallyall 4y agoModestly high interest rates are the only way to break the growth of income inequality fueled by low interest rates. There are other factors boosting real estate prices -- more people desiring to live alone, ease of renting an unused property via Airbnb, people living longer, massive wealth generation via stock markets -- but a low-rate environment offers existing wealth much more leverage to grow.
- serpix 4y agoWith mortgages paying down only the interest doesn't this mean people can become chained to the property? Unable to sell due to the value drop and having to own money to the bank after selling?
- tmnvix 4y agoNegative equity is going to become a real problem for a lot of people who purchased in booming markets over the last few years. As far as I'm aware, most places are 'non-recourse'. Some people might say "if you can carry on making the payments you'll be fine". This isn't true though. Not being able to move city for a job, being unable to upgrade to a larger place to start a family, or feeling financial pressure to stay in an unhealthy relationship are all very real potential problems.