4 ms·

> There won't be a "doom loop", just a market correction to relatively normal levels. Free market at work - everyone speculating on real estate professionally k

> There won't be a "doom loop", just a market correction to relatively normal levels. Free market at work - everyone speculating on real estate professionally knows the risk (or should have known after the 2008ff subprime crisis). Bailing out morons should not be a thing - if no one suffers this time, it's just an invitation for an even worse bubble. The difference is the doom loop leads to things going below "normal" levels (and "normal" is not really a useful term here). Also, I don't think it's fair to say elevated office building prices in SF were the result of wild speculation - it was one of the most booming employment markets in the US with an incredible dearth of supply. High prices are just economic principles at work. Then something totally unexpected came and upended how we work, and that changed the market entirely - it was an external force, not people paying prices that weren't supported by the rents.

mschuster91 3y ago
> Then something totally unexpected came and upended how we work, and that changed the market entirely - it was an external force, not people paying prices that weren't supported by the rents. The thing is, if one is investing money, one should also take into account risk. Remote work has been a thing for years now, with ever faster adoption of broadband Internet. But it seems like a lot of people have either put way too much money into one single asset class or preferred to distribute money to shareholders instead of building some buffer for when tides start to turn. Either of these mistakes is completely avoidable and part of virtually any economics class, it's not rocket science - it's just plain old greed all around.
- idopmstuff 3y ago
  > The thing is, if one is investing money, one should also take into account risk. This is true, but I think the idea that people should have priced in a black swan like a pandemic (and not only a pandemic, but a pandemic that changes the way we work) is not a reasonable one. > Remote work has been a thing for years now, with ever faster adoption of broadband Internet. This makes exactly the opposite point that you intend - despite the fact that people, especially those in tech, have had the infrastructure to work remotely for many years, SF's market still continued to go up in value and have incredibly high occupancy rates. If the condition existed for remote work for years and yet it had no appreciable impact on the use of office space, it wouldn't make any sense to assume that there will be a sudden change to cause everyone to work remotely and the market for office space to crash.
  - mschuster91 3y ago
    > This is true, but I think the idea that people should have priced in a black swan like a pandemic (and not only a pandemic, but a pandemic that changes the way we work) is not a reasonable one. The world has become ever more chaotic the last years. Natural disasters, general political instability, even geopolitical instability has been on the table for a long LONG time now. Acting like a "black swan" event is unthinkable has been beyond foolish.

mschuster91 3y ago

> Then something totally unexpected came and upended how we work, and that changed the market entirely - it was an external force, not people paying prices that weren't supported by the rents. The thing is, if one is investing money, one should also take into account risk. Remote work has been a thing for years now, with ever faster adoption of broadband Internet. But it seems like a lot of people have either put way too much money into one single asset class or preferred to distribute money to shareholders instead of building some buffer for when tides start to turn. Either of these mistakes is completely avoidable and part of virtually any economics class, it's not rocket science - it's just plain old greed all around.

idopmstuff 3y ago
> The thing is, if one is investing money, one should also take into account risk. This is true, but I think the idea that people should have priced in a black swan like a pandemic (and not only a pandemic, but a pandemic that changes the way we work) is not a reasonable one. > Remote work has been a thing for years now, with ever faster adoption of broadband Internet. This makes exactly the opposite point that you intend - despite the fact that people, especially those in tech, have had the infrastructure to work remotely for many years, SF's market still continued to go up in value and have incredibly high occupancy rates. If the condition existed for remote work for years and yet it had no appreciable impact on the use of office space, it wouldn't make any sense to assume that there will be a sudden change to cause everyone to work remotely and the market for office space to crash.
- mschuster91 3y ago
  > This is true, but I think the idea that people should have priced in a black swan like a pandemic (and not only a pandemic, but a pandemic that changes the way we work) is not a reasonable one. The world has become ever more chaotic the last years. Natural disasters, general political instability, even geopolitical instability has been on the table for a long LONG time now. Acting like a "black swan" event is unthinkable has been beyond foolish.