Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The Fed now owns nearly 1/3 of all U.S. mortgages

thestreet.com

Post reply on HN
Print view View original

241–250 of 346 posts

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#241

Post by rayiner »

brmgb wrote: post #152
lkrubner wrote: post #102

Earlier quoted context omitted.

Prices would be very low and unemployment would have averaged 50% for the last 12 years. I’m half joking, but if the Fed did nothing then we would still be in the middle of the Great Recession. Or consider the British “Great Depression” of the late 1800s — that lasted 20 years because the pound was over-valued.

The interesting question is what would have happened if the USA had directely nationalized and restructured the failing banks rather than loan them money after the subprime mortgage crisis and if it had supported the economy through productive investments in infrastructure rather than lowering the Federal funds rate.

How does nationalizing the banks help?

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#242

Post by JackFr »

clairity wrote: post #81
JackFr wrote: post #25

Earlier quoted context omitted.

Taxpayers don’t need to bail out the Fed. The Fed literally creates money ex nihilo.

> "The Fed literally creates money ex nihilo." that's too simplistic. the fed has wide latitude (probably too wide), but it should correlate with the (fuzzy, hard to accurately measure/model) productive capacity/velocity of the (globalized) economy, not just an unlimited well only constrained by inflation's devaluatory noose. moreover, considering our technological progress and trajectory, i'd love to see us revisit…

I don't disagree with you about the role of the Fed.

But from a practical, tangible, rubber-meets-the-road, this-is-how-they-do-it point of view when the Fed buys something, it pays for it by writing a new number in my Fed account. That new number is money.

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#243

Post by rayiner »

refurb wrote: post #41
scrumbledober wrote: post #34

Earlier quoted context omitted.

well as a 30 year old looking for my first home who grew up in the bay area... yeah that's exactly what I feel.

Not to be snarky or obvious, but you should do what the people in the past did - find a better place to live that allows you to buy a home more easily. That's one of the reasons why there was a big migration to places like LA. Lots of jobs and cheap land to build on. To me, SF is like NYC. Unless you got in early or are one of the 1%, it's not a great place to try and build a life in (if you're looking to own a home)…

I mean this is an excellent point. There was a reason they built semiconductor facilities where Silicon Valley now is, and why all the housing is so drab. It was not a highly desirable place to live back then. At today’s prices, my parents couldn’t have afforded to live in the drab DC suburb where I grew up. But there were almost no jobs paying six figures in the area back then, nothing like today.

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#244

Post by daed »

gwd wrote: post #214
tnel77 wrote: post #206

Earlier quoted context omitted.

You don’t treat a couple hundred thousand dollars as an investment? Sounds privileged.

I think you've got it backwards. If new cars all cost $200k, would you buy one as an investment? No -- you'd either not buy one (unprivileged) or buy one anyway realizing it's a cost (privileged). I might spend $100k on a house that I was going to live in for 20-30 years, even if I knew that at the end of that time it was going to be worthless. But I certainly wouldn't spend $500k+ on a house unless I knew I'd be abl…

What if the cost of the monthly interest on your mortgage for that $500k house was less than your rent?

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#245

Post by david927 »

lkrubner wrote: post #102
JMTQp8lwXL wrote: post #18

I would be curious to see analysis for what home prices would be with 0 Fed intervention. Also, I don't understand how millennials aren't supposed to see this figure and immediately feel a sense of rejection, that the housing market is some form of a pyramid scheme, where you had to get in early to have a chance.

Prices would be very low and unemployment would have averaged 50% for the last 12 years. I’m half joking, but if the Fed did nothing then we would still be in the middle of the Great Recession. Or consider the British “Great Depression” of the late 1800s — that lasted 20 years because the pound was over-valued.

That's going to happen anyway but now the Fed will have no power over ameliorating any of it.

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#246

Post by JackFr »

dternyak wrote: post #49
adventured wrote: post #33

Earlier quoted context omitted.

> It strikes me as extremely odd that it's become so normalized that the U.S.'s role in trade is simply as a buyer of goods. It should strike you as odd, what you're saying is wrong. The US exports $2.5 trillion worth of goods and services, including $1.7 trillion of goods. The US is the world's #2 exporter of goods. With services included, the US is nearly the world's #1 exporter. In 2018, the US was behind China by…

Of course, I'm familiar that the U.S. exports goods as well. Certainly the relationship specifically with China is one of a large and continuous trade deficit. However, the broad intention of my previous comment is to illustrate that the narrative being that the U.S. is simply one of purchaser is lacking, or else if that narrative is correct, it will not be true for much longer once the trading partners catch on.

The same question was said about Japan in the 1980's. There was much hand-wringing over our trade deficit with Japan. (Though I had an econ professor back then who I thought put it best: "We're getting cars and they're getting pieces of paper, and somehow we're the ones getting screwed?")

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#247

Post by [deleted] »

brmgb wrote: post #152
lkrubner wrote: post #102

Earlier quoted context omitted.

Prices would be very low and unemployment would have averaged 50% for the last 12 years. I’m half joking, but if the Fed did nothing then we would still be in the middle of the Great Recession. Or consider the British “Great Depression” of the late 1800s — that lasted 20 years because the pound was over-valued.

The interesting question is what would have happened if the USA had directely nationalized and restructured the failing banks rather than loan them money after the subprime mortgage crisis and if it had supported the economy through productive investments in infrastructure rather than lowering the Federal funds rate.

[deleted]

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#248

Post by 1DRACOSEA8 »

It can be a good investment, I certainly have done it and did it for almost a decade. I bought properties cash, the first purchase was (with half of my parents) money in Miami 2007. I made 50% in less than four years and continued doing that in California, until 2018 and I at the moment no longer own property.

Home is ok, but if you’re not paying cash for it, is it really yours? And while yours outright you’re on the hook for annual taxes; good luck in Austin with that

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#249

Post by zxcb1 »

JMTQp8lwXL wrote: post #18

I would be curious to see analysis for what home prices would be with 0 Fed intervention. Also, I don't understand how millennials aren't supposed to see this figure and immediately feel a sense of rejection, that the housing market is some form of a pyramid scheme, where you had to get in early to have a chance.

Those who believe in the self-organization of markets would not interfere, rather work outside of them with regulation and social safety nets.

Re: The Fed now owns nearly 1/3 of all U.S. mortgages

#250

Post by crisdux »

charlesu wrote: post #236
crisdux wrote: post #217

Earlier quoted context omitted.

To be fair, how is that even remotely true? Look at the wealth, convenience, leisure and abundance all around you. Even people with lower income experience high standards of living. The system we have now is not without fault, but it has done better than any other before in meeting our needs and desires. I don't understand why people make wild claims that everything is distributed to only a few hands, thats preposter…

> Look at the wealth, convenience, leisure and abundance all around you. Even people with lower income experience high standards of living. The system we have now is not without fault, but it has done better than any other before in meeting our needs and desires. You should spend some time in Appalachia if you think that's true.

You are making a logical fallacy and I don't think it's worth my time to actually attempt to discuss this with you.
Post reply on HN