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Economists say that high gas prices triggered the housing crisis in 2007 (2012)

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Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#101

Post by newsclues »

etimberg wrote: post #7
newsclues wrote: post #6

Earlier quoted context omitted.

Canada’s housing bubble didn’t pop a decade ago, and continued to inflate.

Housing in the Toronto area has been even more insane than usual the last few months. Houses an hour away from downtown that were selling for ~850k in November 2021 were selling for $1.05M in January and February.

I live two hours from Toronto and a house in a bad area of town that I personally know was a crackhouse 2 years ago, sold for slightly under half a million and is getting gutted and renovated into a duplex.

Last time I was in the house, crackheads were shitting in buckets. Literally.

And there isn’t a lot of good jobs here!

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#102

Post by [deleted] »

ddubski wrote: post #94
huitzitziltzin wrote: post #72

Economist here. For what it’s worth I cannot find evidence that this paper was ever published, so I think it’s safe to say they did not convince the rest of the profession that this was the (or even a) trigger. I’m sure it’s being shared to suggest that high current gas prices will do the same now. I doubt anyone has any good reason to be confident in such a suggestion.

Hi, I’m the OP. I shared this because from a practical perspective it seems that filling a car’s fuel tank is one of the most volatile and essential line items in a typical household budget, and when expensive housing (owned or rented) stretches household budgets, prolonged increases in gas prices could feasibly be a “straw that breaks the camel’s back”, as another commenter mentioned. I appreciate the far more educa…

[deleted]

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#103

Post by jcrash »

mgh2 wrote: post #90
huitzitziltzin wrote: post #72

Economist here. For what it’s worth I cannot find evidence that this paper was ever published, so I think it’s safe to say they did not convince the rest of the profession that this was the (or even a) trigger. I’m sure it’s being shared to suggest that high current gas prices will do the same now. I doubt anyone has any good reason to be confident in such a suggestion.

The link to the paper is broken, wanted to examine their method to see if the analysis is sound

I found it on another site:

https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.80...

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#105

Post by zitterbewegung »

ethagknight wrote: post #87
zitterbewegung wrote: post #83

Earlier quoted context omitted.

Gas prices have been from the $2.00 to the $5.00 mark for the past decade. Adjusting for inflation Gas is getting relatively cheaper but the last time it actually changed consumption it would be around 2008 so it was at the $5.00 mark ($6.55 a gallon). Biden just released the national gas reserves which is an attempt to keep prices lower. For a long time it has been said that we have to change peoples behavior to sol…

Just let gas prices be higher than we are used to, people will figure it out for themselves. Blame it on Russia, Saudi Arabia, ramp up local production and call it a day. I recently sold my large luxury SUV in exchange for a smaller sedan ( that happens to be electric). I’ve always thought I needed a large SUV to do the things I want to do, so far nothing is changed. I personally made a huge quantum leap in personal…

What happens when we have a massive amount of electric car batteries that can't be recycled? (not being rhetorical here is there some kind of report)

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#106

Post by zitterbewegung »

ddubski wrote: post #94
huitzitziltzin wrote: post #72

Economist here. For what it’s worth I cannot find evidence that this paper was ever published, so I think it’s safe to say they did not convince the rest of the profession that this was the (or even a) trigger. I’m sure it’s being shared to suggest that high current gas prices will do the same now. I doubt anyone has any good reason to be confident in such a suggestion.

Hi, I’m the OP. I shared this because from a practical perspective it seems that filling a car’s fuel tank is one of the most volatile and essential line items in a typical household budget, and when expensive housing (owned or rented) stretches household budgets, prolonged increases in gas prices could feasibly be a “straw that breaks the camel’s back”, as another commenter mentioned. I appreciate the far more educa…

Then why not post this as a text post instead of trying to promote your worldview with an unfounded paper? This is extremely dishonest.

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#107

Post by jessaustin »

mumblemumble wrote: post #46
jessaustin wrote: post #33

Earlier quoted context omitted.

It can't be discharged through bankruptcy (thanks Joe!), but neither can we squeeze blood from stone. Debtors who don't have the funds to both eat and make their payments will not make their payments.

I assume that by Joe you mean Joe Biden? Student loans haven't been something you can discharge in bankruptcy since the 1970s. If you want to thank a US president (as opposed to, say, the legislature that actually passes these laws), you should be thanking Gerald.

Joe Biden was a legislator for 38 years. He probably doesn't remember every bill he sponsored, but it's not as though he didn't choose to sponsor them.

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#108

Post by treis »

FollowingTheDao wrote: post #53
mumblemumble wrote: post #25

Earlier quoted context omitted.

> owners with their 2.75% mortgages aren't going to be inclined to sell. Or able to sell. This is the other side of historically low rates pushing home prices up by allowing people to pay higher prices while keeping their mortgage payment affordable. If (when?) rates go back up, that may cause prices to fall. This could also put people underwater on their homes, and even trigger another (hopefully smaller?) wave of f…

> Or able to sell. This is crucial. Many people sometime need to sell. When people cannot buy it they lower the price. When they lower the price the valuation of neighboring houses goes down. If people also have less money saved because of higher oil prices, well, they another compounding factor. Rates are going to go up, and it is much to late in the game for them to rise without serious repercussions.

The "bid" order book is extremely deep though. Lots of people priced out that are willing and able to buy at lower prices. So it's unlikely the we get into a bubble popping situation. Worst likely case is static nominal prices while inflation erodes the real prices.

The only sort of cataclysmic risk out there is a change in government regulations. Zoning changes, Prop13, or some action banning investors owning SFHs. But none of that seems remotely imenent.

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#109

Post by ddubski »

zitterbewegung wrote: post #106
ddubski wrote: post #94

Earlier quoted context omitted.

Hi, I’m the OP. I shared this because from a practical perspective it seems that filling a car’s fuel tank is one of the most volatile and essential line items in a typical household budget, and when expensive housing (owned or rented) stretches household budgets, prolonged increases in gas prices could feasibly be a “straw that breaks the camel’s back”, as another commenter mentioned. I appreciate the far more educa…

Then why not post this as a text post instead of trying to promote your worldview with an unfounded paper? This is extremely dishonest.

I actually felt that sharing this provided a more credible starting point for the discussion than my own viewpoint. I did not think to confirm whether the paper had been published so I’ve learned my lesson on that.

To be honest I’m a bit surprised by the strong reactions as today’s news is filled with different perspectives on the economic consequences of higher gas prices (as unimportant as that is relative to the war in Ukraine) but I appreciate the feedback. There’s no intent to be dishonest or self-serving here but I’m sorry if that’s how it was construed.

Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)

#110

Post by philipkglass »

jiggyjace wrote: post #70
api wrote: post #13

The more EVs penetrate the market the less vulnerable we are to oil price spikes. Oil has been the rate limiting reagent of our civilization. That is ending.

I feel like EV market penetration would need to be pretty insane for a society to be less vulnerable to oil price spikes. For context the US is around 5% EV penetration currently. I don't think that number includes recreational vehicles like RVs, motor boats, motorcycles, ATVs, 4x4s, etc. (most with 0% EV penetration). But then you have the aspect of electricity generation. Did you know that the US currently generate…

Did you know that the US currently generates 4 times as much electricity from oil as most renewables only excluding nuclear (hydro, solar, wind).

This is incorrect. As of 2021 the United States generated about 0.5% of its electricity from petroleum. It generated 9.2% from wind, 6.3% from hydro, and 2.8% from solar.

https://www.eia.gov/tools/faqs/faq.php?id=427&t=3

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