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Every physical good is a financial asset whether you like it or not. Ignoring this reality will not help achieve policy goals. I agree that you are accurately
by wyager 3y ago
Every physical good is a financial asset whether you like it or not. Ignoring this reality will not help achieve policy goals.
I agree that you are accurately describing the economically illiterate thought process, just not that it's correct.
Price controls are one of those interesting things where there's a phase transition from near-universal support to near-zero support at a certain knowledge level.
- klodolph 3y agoTreating everything as nothing more than a financial asset is way too reductive. My point here is that housing is not only a financial asset, and should be treated as more than just a financial asset. Or if you want to take an economic approach here, you need to come up with a utility function that more accurately reflects what we care about—we think that two people who have housing is a better situation than one person who has two houses and one person who has none.
- wyager 3y agoThankfully we have a mechanism for working utility-theoretic optimization into economic calculations. The mechanism is called "prices". When you undermine this mechanism, you are not globally utility-maximising.