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  • On 22 Aug 2014 in Why your house is a terrible investment, Bellingham Bill said:

    Tim Aurora says

    For example you do not buy a plane because you travel, or a hotel because you vacation.

    thing is, traveling is a temporary consumer demand.

    housing is different; we all need a secure place for our stuff regardless of our situation, and that's not something the Invisible Hand can currently provide outside of purchase or lease of a home of some sort.

    At the extreme edge it is possible to create a serviceable home out of an RV, but that is pushing things and certainly not for everyone, and doesn't work at all outside of designated campgrounds and otherwise camping-friendly areas.

    The dynamics of housing in the US has been relentless rent rises, more relentless in the better (higher-wage) areas.

    What my parents rented for $300/mo in El Cerrito now rents for $2000, $500 more than inflation. 150hrs of (pre-tax) minimum wage work in 1974, 222hrs now. Same story in Salinas, what was $400/mo in the late 70s is pushing $2000/mo now. What I rented for $700/mo in LA in 1991 now rents for $2000/mo.

    While the past can't predict the future, clearly the current status quo is biased towards a rising cost of living in housing.

    How can it not, when there's so much debt tied to that valuation?

    Shows we still have a $2T debt overhang, and our rising population isn't helping matters:

  • On 22 Aug 2014 in Some of yous will get this, most won't, Bellingham Bill said:

    "The cohesive elements are free exchange"

    Of land tenancy? Of health care?

    "free exchange" of such critical needs in such limited supply is a fucking pipe dream.

    As is "free exchange" with the developing world. The average american can't compete with 2 billion+ potential factory workers overseas and south of us living at a dramatically shittier standard of living.

    "His monthly salary of 3,500 to 4,500 yuan ($580 -$740) -- depending on overtime -- is higher than the average wage, but only because his job requires more risks -- the ink has toxic fumes."

    http://www.cnn.com/2014/01/02/world/asia/china-migrants-mental-health/

  • On 21 Aug 2014 in What the Fed has to do with social security, Bellingham Bill said:

    Another issue is the interest SS is credited on their $2.7T trust fund.

    that was 6% ~10 years ago but is now under 4%. That lost 2% yield is $50B/yr in lost interest, equal to the ss contributions of over 8 MILLION wage positions at $50,000 per.

    http://www.ssa.gov/oact/progdata/effectiveRates.html

    but the SSTF itself is kinda a joke AFAICT. Congress just prints the bonds that "pay" the interest I think, there's no actual appropriations out of tax revenue to pay it.

    All this printing is now about half the trust fund.

  • On 20 Aug 2014 in Stiglitz says austerity has failed in Europe, Bellingham Bill said:

    Stiglitz is about the only guy in economics close to my politics.

    He and Michael Hudson, and Steve Keen. They make a good defense of their heterodoxy away from the neoclassical mainstream.

  • On 19 Aug 2014 in The stock market is not going to crash and will soon make new highs, Bellingham Bill said:

    tr6 says

    Tapering still has a way to go

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