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Yes: http://www.amazon.com/Progress-Poverty-Industrial-Depressions-Increase/dp/0911312587 http://www.amazon.com/Progress-Poverty-Industrial-Depression... Price

Yes: http://www.amazon.com/Progress-Poverty-Industrial-Depressions-Increase/dp/0911312587 http://www.amazon.com/Progress-Poverty-Industrial-Depression... Prices are related to available credit. Wages (and rent) have hardly budged but land prices have rocketed.

throwaway1979 11y ago
This is going off on a tangent but I think you are spot on. It isn't just two incomes fueling the credit increase but also the insanely low interest rates. I don't think female workforce participation will/should go down, but I wonder if interest rates will ever go up to reasonable levels and pop the real-estate bubble (e.g. in Canada)? I have friends with crappy income situations buying houses for 600K+. I've been trying to hold off for as long as possible but we would really like to plant our roots somewhere (poor immigrant to the Western world so owning land in my new homeland was a dream from childhood). In places like Toronto and Vancouver, buying a home for people of modest means seems financial suicide (perhaps only if you have taken Econ courses). We live in messed up times.
branchless 11y ago
can't reply to the throwaway dude as HN threading is nuts so replying here. Low interest rates allows banks to more efficiently financialise housing (that is to say price housing at the optimal point to extract as much economic rent as possible). You get to spread your repayments over a long time and end up paying lots of lovely interest. Higher rates (and therefore more wage inflation) quickly erodes the debt whilst putting a ceiling on the asset price bounded by wages at the time you sign the mortgage deeds. The west has been utterly captured by banks. We've seen politicians walk rates down to zero to allow the asset price bubble to continue to extract value from labour. This is the issue. It's not off-topic for this - all families are working two jobs for the banks. ps also dude as you are in Canada (so am I): http://www.greaterfool.ca/ http://www.greaterfool.ca/ Vancouver is nuts. Calgary: timber

throwaway1979 11y ago

This is going off on a tangent but I think you are spot on. It isn't just two incomes fueling the credit increase but also the insanely low interest rates. I don't think female workforce participation will/should go down, but I wonder if interest rates will ever go up to reasonable levels and pop the real-estate bubble (e.g. in Canada)? I have friends with crappy income situations buying houses for 600K+. I've been trying to hold off for as long as possible but we would really like to plant our roots somewhere (poor immigrant to the Western world so owning land in my new homeland was a dream from childhood). In places like Toronto and Vancouver, buying a home for people of modest means seems financial suicide (perhaps only if you have taken Econ courses). We live in messed up times.

branchless 11y ago

can't reply to the throwaway dude as HN threading is nuts so replying here. Low interest rates allows banks to more efficiently financialise housing (that is to say price housing at the optimal point to extract as much economic rent as possible). You get to spread your repayments over a long time and end up paying lots of lovely interest. Higher rates (and therefore more wage inflation) quickly erodes the debt whilst putting a ceiling on the asset price bounded by wages at the time you sign the mortgage deeds. The west has been utterly captured by banks. We've seen politicians walk rates down to zero to allow the asset price bubble to continue to extract value from labour. This is the issue. It's not off-topic for this - all families are working two jobs for the banks. ps also dude as you are in Canada (so am I): http://www.greaterfool.ca/ http://www.greaterfool.ca/ Vancouver is nuts. Calgary: timber