5 ms·

Some people seem to be disappointed that the economy isn't crumbling. I wonder why?

draw_down 3y ago
[dead]
orangecat 3y ago
The far right is outraged that the Biden administration has implemented socialism; the far left is outraged that they haven't.
- dragonwriter 3y ago
  I would say instead: The Right understands that positive perception of the economy rebounds to the benefit of the incumbent President and they want Biden to lose to the Republican nominee for partisan reasons. The far Left understands that positive perception of the economy rebounds to the benefit of the incumbent President and they want Biden to lose to Trump, who they expect to be the Republican nominee, for accelerationist reasons. The news media likes negative spins because public insecurity drives news media consumption.
  - foob 3y ago
    That's quite the broad brush you're using to paint the Left as accelerationists who favor Trump over Biden.
    - dllthomas 3y ago
      Leaving aside possible disagreement on definitions, it's worth noting that dragonwriter said "the far Left" - that may still be too broad a brush, but it would not seem to extend to the entire Left.
- FooBarBizBazz 3y ago
  Or, they simply took the bait of 5% cash and were hoping some deals were going to be forthcoming. You could say I'm one of those people. I want home prices to come down. If the property-owning Boomers were to respond, in that housing-crash scenario, by voting for Trump, that'd be on them. I'm sick of being held hostage though. You want me to choose a political leader? How about Mao, to shoot the landlords, or Khrushchev, to build some apartments?
  - mapontosevenths 3y ago
    Have you considering learning a new trade that pays better, or moving to a more prosperous area of the world as an alternative to razing the entire social order to the ground and installing genocidal despots in place of our leaders? It just sounds like it might be simpler.
    - FooBarBizBazz 3y ago
      > Have you considering learning a new trade that pays better I tried starting a lemonade stand and cutting back on Starbucks, but found, if I really wanted a roof over my head, that the thing to do was to SPAC a plausible-sounding company into the indexes. > moving to a more prosperous area of the world Those are precisely the ones with the inflated home prices. > as an alternative to razing the entire social order to the ground and installing genocidal despots in place of our leaders? ... It just sounds like it might be simpler. I dunno. It'll take 30 years to pay off a mortgage, but the Cultural Revolution was over in about a decade. I might still have some good years left after it ends.
jjulius 3y ago
Flippant response: Social media has normalized spending every waking moment feeling like the world around you is going to collapse and that things are horrible, and this is what happens when reality ends up doing something else.
goles 3y ago
I suspect it's more a reflection of the anxieties of the public in journalists than anything sinister. But the undercurrent of, "I hope we fail" (but never me) is certainly present in a lot of discourse.
- dragonwriter 3y ago
  > I suspect it's more a reflection of the anxieties of the public in journalists than anything sinister. To the extent there is a media response to popular perception involved, its very sifferent than that, nearly the opposite (the journalistic class frustrated at the lack of anxiety in the public), which is why it has increased in shrillness with the positive turn in the future expectations component of sentiment (and why you had to dig into the numbers to find that the “low sentiment” on the economy being flogged before that by journalists as an indicator of negative perception of current conditions was actually all in the future expectations component, with the current situation component being quite positive even when the overall measure was down.)
- adolph 3y ago
  It’s like the announcers at a tight rope walk, NASCAR race or hockey game. The interest is driven in part by the danger, the threat of a fall, crash or fight. The fundamentals of the activity are beyond most of the audience’s comprehension and spelling it out would be hopelessly dull for people who already know and the people who aren’t interested enough to have learned about the activity before hand. “Holiday Sales Figures Mostly Unchanged” is not a clickable headline. The paper boys would fall asleep before they shout “read all about it.”
cmrdporcupine 3y ago
Because there's legitimate concerns about high inflation generally, and in particular housing affordability (the latter especially in places like Canada that appear to be in a drastic real estate bubble). If the economy doesn't slow, we'll see more rate hikes.
- data-ottawa 3y ago
  I do know of people who decided they couldn't get into the housing market (here in Canada) and have been drawing down their down payment savings to spend. It's probably a very small portion of this spending increases overall, but interesting to see. Rates here seem to have stabilized for the time being, and house sales are way down, so I think now we're going to finally see housing price declines this spring season. The next 2-3 years will get rough as fixed mortgages renew, with my own mortgage payment expected to increase by nearly 50% at renewal, and 70% of the total payment will go to the increased interest payments alone. The total cost of my mortgage at today's rates would be triple what I signed on for! I don't see how this won't wreak havoc on the average families finances.
jhickok 3y ago
I am not an economist, but I think it's the opinion of many that the only way to defeat inflation is to tip the economy over, and the more the economy resists the higher rates have to go, and the worse the tipping over event is going to be.
- matwood 3y ago
  Except that inflation has gone down as fast as it went up. The Fed has paused rate increases to see if what they have already done is enough. The talk of lowering rates is because the Fed doesn't want to overshoot on the way down.
  - Xeoncross 3y ago
    No, inflation has not gone down. The rate of inflation growth has gone down.
    - orangecat 3y ago
      No, inflation has not gone down. It has. Inflation is the derivative of prices. Prices are increasing but less rapidly than before, which means that inflation has decreased.
      - bratwurst3000 3y ago
        Don’t you mean the rate of inflation is down? Prices are growing so they are inflating and not deflating. I am an idiot so beeing wrong is my thing. https://en.m.wikipedia.org/wiki/Deflation https://en.m.wikipedia.org/wiki/Deflation
    - ekidd 3y ago
      Inflation is the rate of change of prices. In calculus terms, it's the first derivative of price. (I'm not sure what you mean by "the rate of inflation growth." Do you mean the second derivative of price, maybe?) Inflation has gone down in the US. The last few months, if you extrapolate them to an annual rate, would (I think) be between 2 and 3%, which is the Fed's normal target. Unfortunately, some of the recent price increases may stick. However, the US has seen strong wage growth, and many areas have high demand for labor. I've seen a surprising number of businesses with 1/4th of their usual positions open. It's a good time to apply to better-paying jobs. Not so much in the tech industry, but in other industries. On the other hand, with rates as high as they are, it's an awful time to buy a house or a car using a loan.
deleted 3y ago
[deleted]
88913527 3y ago
Disappointment in the permanent increases in prices. All else equal, people want deflation after a period of elevated inflation levels.
- matwood 3y ago
  The Fed will fight across the board deflation like crazy because that's how the economy ends up in a depression.
  - 88913527 3y ago
    We did have high inflation for a year, and were told it was temporary, before tools were deployed. Would a sustained period of deflation be met with a similarly lagged response?
    - eropple 3y ago
      My understanding (I am not an expert) is that tools for dealing with deflation are much less effectively deployable and have ripple effects that can significantly damage the real economy.
- jhickok 3y ago
  This is definitely part of it. People need to adjust to a new price reality, and while they think they want deflation they certainly do not want what a deflationary period entails is happening in the economy.
deleted 3y ago
[deleted]

[dead]

The far right is outraged that the Biden administration has implemented socialism; the far left is outraged that they haven't.

dragonwriter 3y ago
I would say instead: The Right understands that positive perception of the economy rebounds to the benefit of the incumbent President and they want Biden to lose to the Republican nominee for partisan reasons. The far Left understands that positive perception of the economy rebounds to the benefit of the incumbent President and they want Biden to lose to Trump, who they expect to be the Republican nominee, for accelerationist reasons. The news media likes negative spins because public insecurity drives news media consumption.
- foob 3y ago
  That's quite the broad brush you're using to paint the Left as accelerationists who favor Trump over Biden.
  - dllthomas 3y ago
    Leaving aside possible disagreement on definitions, it's worth noting that dragonwriter said "the far Left" - that may still be too broad a brush, but it would not seem to extend to the entire Left.
FooBarBizBazz 3y ago
Or, they simply took the bait of 5% cash and were hoping some deals were going to be forthcoming. You could say I'm one of those people. I want home prices to come down. If the property-owning Boomers were to respond, in that housing-crash scenario, by voting for Trump, that'd be on them. I'm sick of being held hostage though. You want me to choose a political leader? How about Mao, to shoot the landlords, or Khrushchev, to build some apartments?
- mapontosevenths 3y ago
  Have you considering learning a new trade that pays better, or moving to a more prosperous area of the world as an alternative to razing the entire social order to the ground and installing genocidal despots in place of our leaders? It just sounds like it might be simpler.
  - FooBarBizBazz 3y ago
    > Have you considering learning a new trade that pays better I tried starting a lemonade stand and cutting back on Starbucks, but found, if I really wanted a roof over my head, that the thing to do was to SPAC a plausible-sounding company into the indexes. > moving to a more prosperous area of the world Those are precisely the ones with the inflated home prices. > as an alternative to razing the entire social order to the ground and installing genocidal despots in place of our leaders? ... It just sounds like it might be simpler. I dunno. It'll take 30 years to pay off a mortgage, but the Cultural Revolution was over in about a decade. I might still have some good years left after it ends.

jjulius 3y ago

Flippant response: Social media has normalized spending every waking moment feeling like the world around you is going to collapse and that things are horrible, and this is what happens when reality ends up doing something else.

goles 3y ago

I suspect it's more a reflection of the anxieties of the public in journalists than anything sinister. But the undercurrent of, "I hope we fail" (but never me) is certainly present in a lot of discourse.

dragonwriter 3y ago
> I suspect it's more a reflection of the anxieties of the public in journalists than anything sinister. To the extent there is a media response to popular perception involved, its very sifferent than that, nearly the opposite (the journalistic class frustrated at the lack of anxiety in the public), which is why it has increased in shrillness with the positive turn in the future expectations component of sentiment (and why you had to dig into the numbers to find that the “low sentiment” on the economy being flogged before that by journalists as an indicator of negative perception of current conditions was actually all in the future expectations component, with the current situation component being quite positive even when the overall measure was down.)
adolph 3y ago
It’s like the announcers at a tight rope walk, NASCAR race or hockey game. The interest is driven in part by the danger, the threat of a fall, crash or fight. The fundamentals of the activity are beyond most of the audience’s comprehension and spelling it out would be hopelessly dull for people who already know and the people who aren’t interested enough to have learned about the activity before hand. “Holiday Sales Figures Mostly Unchanged” is not a clickable headline. The paper boys would fall asleep before they shout “read all about it.”

cmrdporcupine 3y ago

Because there's legitimate concerns about high inflation generally, and in particular housing affordability (the latter especially in places like Canada that appear to be in a drastic real estate bubble). If the economy doesn't slow, we'll see more rate hikes.

data-ottawa 3y ago
I do know of people who decided they couldn't get into the housing market (here in Canada) and have been drawing down their down payment savings to spend. It's probably a very small portion of this spending increases overall, but interesting to see. Rates here seem to have stabilized for the time being, and house sales are way down, so I think now we're going to finally see housing price declines this spring season. The next 2-3 years will get rough as fixed mortgages renew, with my own mortgage payment expected to increase by nearly 50% at renewal, and 70% of the total payment will go to the increased interest payments alone. The total cost of my mortgage at today's rates would be triple what I signed on for! I don't see how this won't wreak havoc on the average families finances.

jhickok 3y ago

I am not an economist, but I think it's the opinion of many that the only way to defeat inflation is to tip the economy over, and the more the economy resists the higher rates have to go, and the worse the tipping over event is going to be.

matwood 3y ago
Except that inflation has gone down as fast as it went up. The Fed has paused rate increases to see if what they have already done is enough. The talk of lowering rates is because the Fed doesn't want to overshoot on the way down.
- Xeoncross 3y ago
  No, inflation has not gone down. The rate of inflation growth has gone down.
  - orangecat 3y ago
    No, inflation has not gone down. It has. Inflation is the derivative of prices. Prices are increasing but less rapidly than before, which means that inflation has decreased.
    - bratwurst3000 3y ago
      Don’t you mean the rate of inflation is down? Prices are growing so they are inflating and not deflating. I am an idiot so beeing wrong is my thing. https://en.m.wikipedia.org/wiki/Deflation https://en.m.wikipedia.org/wiki/Deflation
  - ekidd 3y ago
    Inflation is the rate of change of prices. In calculus terms, it's the first derivative of price. (I'm not sure what you mean by "the rate of inflation growth." Do you mean the second derivative of price, maybe?) Inflation has gone down in the US. The last few months, if you extrapolate them to an annual rate, would (I think) be between 2 and 3%, which is the Fed's normal target. Unfortunately, some of the recent price increases may stick. However, the US has seen strong wage growth, and many areas have high demand for labor. I've seen a surprising number of businesses with 1/4th of their usual positions open. It's a good time to apply to better-paying jobs. Not so much in the tech industry, but in other industries. On the other hand, with rates as high as they are, it's an awful time to buy a house or a car using a loan.

deleted 3y ago

[deleted]

88913527 3y ago

Disappointment in the permanent increases in prices. All else equal, people want deflation after a period of elevated inflation levels.

matwood 3y ago
The Fed will fight across the board deflation like crazy because that's how the economy ends up in a depression.
- 88913527 3y ago
  We did have high inflation for a year, and were told it was temporary, before tools were deployed. Would a sustained period of deflation be met with a similarly lagged response?
  - eropple 3y ago
    My understanding (I am not an expert) is that tools for dealing with deflation are much less effectively deployable and have ripple effects that can significantly damage the real economy.
jhickok 3y ago
This is definitely part of it. People need to adjust to a new price reality, and while they think they want deflation they certainly do not want what a deflationary period entails is happening in the economy.

deleted 3y ago

[deleted]