With Turkish drones.
The Economy (2020/21)
- Thread starter rideit
- Start date
Important lesson for kids is: Don’t let anything stand in the way of your dreams. Not even buildings.
But look at all this representation.I have an acquaintance that regularly babbles about "all taxation is theft" then wanders off to her job as a tax auditor for the State of Colorado.
Ask them if they pay no taxes if it would be ok to have them arrested for theft and trespassing if they used public utilities or ventured out on public roads?I have an acquaintance that regularly babbles about "all taxation is theft" then wanders off to her job as a tax auditor for the State of Colorado.
Shit's about to get rough. Fed raised rates .75% today (1.5-1.75%) and are talking another .5-.75% next month.
I would expect stock market to keep going down, though it already largely pricing in a recession. Bonds, which are you conservative option, are going down as rates go up as well.
So keep your savings up and tighten your wallets. Next few months could get nasty.
I would expect stock market to keep going down, though it already largely pricing in a recession. Bonds, which are you conservative option, are going down as rates go up as well.
So keep your savings up and tighten your wallets. Next few months could get nasty.
who gives a fuck, I don't sell over inflated houses
who wants to steal an oil tanker?
full, of course
who wants to steal an oil tanker?
full, of course
You don't. But most people work for private companies and feel the results of layoffs when profits go down.
well, they tried airplanes.
You'll never get a "will" out of me."could"
But in other news... A bunch of out plastic food containers finally gave up over the last few weeks and we need more. I'm digging through storage to see what else I might have instead of buying anything, which is easier.
If divebombing passenger planes don't do it, why would this?
is that a 'no' on the oil tanker? Sounds like you might have some free time coming up
I should be fine. We have long-term relationships with my clients and two resigned with the caveat that I am their rep. I can promote up, but firing me would be problematic. Also, ADA. I'm difficult.
the damage is done
our entire housing stock is 2nd/3rd/4th homes for trust funders and corporate real estate investments now
and to address that problem, we're going to criminalize homelessness and punch down, with exaggerated new crime statistics and more militarized police forces
you gonna cosplay exxon valdez?
wait.... for a mortgage?
Yes.
The real estate market is cold for the foreseeable future. AND! AND! over 22% of current mortgages are adjustable rate loans. EVEN after 2008. The MBS market is going to crash AGAIN, and with it many of the overleveraged fucks who relied on that for their overleveraged fuckery.
This sounds intriguing... will there be rum? I may give this strong consideration if there will be rum. I might even get an eye patch.
Our first mortgage in 2000 was... almost 7% IIRC. Although my rememberer is pretty poor these days. It has only been the last 10 years or so that money has been so ridiculously cheap.
grab one right as it's coming into a texas refinery, we take over both (the power will be off due to grid failure), and we take over production, limit supply, and start our own localized fuel empire where master blaster controls barter town
never pictured you as running a mad max style post apocalyptic wasteland, but ok
It is worth pointing out that 6.7 is still historically low. I am of the opinion however that when the whole modern house of cards is built around money being much cheaper, things are going to get bad when rates return to the mean. See @Nicks post.
so wait a year or 2 and i'll be able to buy a bigger house at rock bottom prices? got it.
we all need dreams
I saw the writing unquestionably on the wall about a year ago and took advantage of the free money. Almost every project Wifey wanted done on the house, minis a few beast level, have been done and are just chugging along getting paid off monthly.
glad I refi'd last summer below 3%
But with prices being historically way the fuck over a percentage of wages, every little dinky point counts that much more.
It costs more to buy a house now, maybe more than ever. The mortgage rate is only part of it obviously.
exactly. a 10 or even 15% rate on a mortgage was manageable when the median home price was below $100k
*Until
It's the transition. Housing prices will move with rates, but at a delay. You need to look at the dominos. Mind there is overlap here.
1. Boomers are retiring and starting the process of living off their investments. Large populations have been planning for decades on selling their homes and downsizing to LCOL locations.
2. In theory (hahaha) Boomers have reduced the risk to their investments because they are near or in retirement. They are still taking bond related losses, again related to rate increases, but not as bad as stock. Reality, that is not the case. It's taken two substantially negative quarters for most to realize that things have actually gone down and panic is beginning to set in. Flight to Safety? Well they sure as hell aren't selling to bonds (see rates driving down bonds), so they're going to cash. What happens to cash in a high inflation environment? Bad things. It goes down in value and irreconcilably.
3. All that selling? That's driving down the market. Where did the young people who had some potential to buy their houses have their money? You guessed it - the market. And as the market goes down, don't forget it's a leading indicator for economic slowdown - which is already occuring. People are going to start losing their jobs because nobody is buying anything, because the economy has slowed down.
4. But your Required Minimum Distribution! The market is down and now you have to sell your investments! Time to get our fellow Boomer congressperson to change the laws so that we don't have to take money out until later. (See CARES Act 70.5>72 and proposed CARES Act 2 72 > 75) We'll just keep working. We'll work for less, if that's what it takes to keep our jobs, we have old age protection and our houses are paid for anyways.
5. Back to those houses people were planning on selling to retire. Guess what, with rates going up, you can't; there is nobody to buy them - at least people. Rates are high, people have a set amount of money they can spend monthly, and mathematically, you're only going to get what that new rate and their oop availability calculates back to for your home price. The higher the rate, the lower the price. But it gets better! You know who has money? Corporations. They can buy your house. They have the capital, because they can depreciate it and amortize it over a massive timeline. They will give you fractionally more than you can get from an individual, if you can find someone. Otherwise? Any offer is better than no offer, right?
6. But said Boomers likely don't have enough money to survive still though. So yeah, let's just keep working. So as we go into nationwide layoffs since the economy is sliding, cheaper people tend to get kept on. Oh, and they have old age protection? That makes it a lot harder to get rid of them. Tough shit for those youngin's. And the more you work, the higher you SS goes up, so good for you.
7. But this is where demographics becomes a problem. Young people not working means no money being paid into taxes - including SS. No sales being made beyond the absolute basics, because rent is so high. No sales means businesses struggle more and continue to go under. No sales means no sales tax, which means no amenities or maintenance in your community, so your house becomes worth progressively less. Also nobody is having kids. If they can't afford themselves, how can they afford a kid?
8. Oh, and getting the Fed to help with economic support? Just drop rates... Right. They can't, because of the inflation. Unironically, caused by the Boomers.
There's your worst case playing out. Front end over 1-2yrs. Back end starting in probably 10. Talked with a demographer a while back, in adtn to one of our economists and damn if they don't line up. We're probably 25yrs out from Japan re demography. That's scary.
So. Who wants pizza for lunch?
Yep. For reference:
I ain't done the maths, but I'd say 7% is probably about the right figure for the mean since '70.
Looks like Sep 2023 is the end. Which is good, as I'll have the 3rd kid going off to uni right at that time.
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i basically picture him as a cross between samwise gamgee and randy marsh that mountain bikes in tighty whiteys
No. Definitely madmax and Dennis Quaid in Day After Tomorrow.