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

How This Ends

avc.com

Post reply on HN
Print view View original

321–330 of 698 posts

Re: How This Ends

#321

Post by ethbr0 »

architravesty wrote: post #283
hackernewds wrote: post #174

Earlier quoted context omitted.

RE is at massive peak levels already though that buyers cannot shell out those prices, esp as mortgage prices go up.

Worst part is the utterly absurd shortage means RE is never going to meaningfully dip for any period of time without serious structural reforms. The focus on interest rates as the main RE driver is almost completely cope and I wish I could believe it. Low-rate mortgages certainly aren't helping, but they're "not helping" in the same way that hucking an armload of kindling into an already-raging house fire is "not hel…

Local zoning codes change on the order of decades. That will take a long time to play out.

Re: How This Ends

#322

Post by ethbr0 »

jbay808 wrote: post #184
chmod600 wrote: post #126

Earlier quoted context omitted.

I motice that you left out real estate from your analysis. RE is interesting because it's both an asset as well as something you can use. So if there's general inflation, it's got both upward pressure (because it's an alternative to rent from a consumer standpoint) and downward pressure (because bonds are an alternative to RE from an investment standpoint).

RE is highly leveraged (people borrow money to buy it), meaning that it gets hit hard by rising interest rates.

New buying gets hit hard. In the US, fixed rate 30 year mortgages mean that a lot of existing owners are isolated from rates (albeit not from market price devaluations).

Re: How This Ends

#323

Post by hn_throwaway_99 »

jbay808 wrote: post #302
88913527 wrote: post #260

Earlier quoted context omitted.

US commenters hopefully know they can re-finance when rates go down. Locked in, with the option of re-fi'ing. Only possible when rates drop but we're yet to have a period of 30 years of continually rising rates.

Yes, I didn't mean to imply that wasn't the case. I meant that in the US, homebuyers can fully protect themselves from the downside risk, an option that doesn't exist in many other countries (like Canada).

Thanks for the info. I was unaware fixed rate mortgages weren't available in other countries.

Re: How This Ends

#324

Post by ModernMech »

Aunche wrote: post #278
CyanLite4 wrote: post #162

Earlier quoted context omitted.

That was “only” a few hundred billion. It pales in comparison to the $9 trillion in QE over the past decade given to the largest banks.

First of all, the entire stimulus was $4.5 trillion, and most of it was allocated to handouts. A lot of the handouts were necessary, like expanded unemployment, but others were complete wastes of money, e.g. giving checks to families making 6 figures or forgiving loans for billion dollar "small businesses." Second of all, QE isn't money given to the banks. When we have a deficit, the government sells bonds to banks.…

> but others were complete wastes of money, e.g. giving checks to families making 6 figures

Remember that the cutoff for stimulus was from prior year's taxes. This means you could have been making 6 figures in 2019, and then be making significantly less due to covid job loss or reduction when stimulus was handed out. As a matter of fact, stimulus helped my family greatly even though we made 6 figures in 2019. So following through on your claim would have meant my family suffering. YMMV.

Re: How This Ends

#325

Post by kache_ »

jeffbee wrote: post #136
ChrisMarshallNY wrote: post #83

> I would be planning to ride this thing out for at least eighteen months or more. I'm betting more like three to five years. I was talking to a friend (another old guy, like me, but really rich, unlike me). We've both been through at least two recessions (big, nasty ones, with teeth and claws). We realized that there's an entire generation of folks; many running companies, that have never seen a real bear market. It…

How could there be a whole generation of CEOs who never saw a recession? Are there 13-year-old CEOs?

during the 2008 recession I was too busy playing Runescape

Re: How This Ends

#326

Post by electrondood »

tenpies wrote: post #214
chmod600 wrote: post #126

Earlier quoted context omitted.

I motice that you left out real estate from your analysis. RE is interesting because it's both an asset as well as something you can use. So if there's general inflation, it's got both upward pressure (because it's an alternative to rent from a consumer standpoint) and downward pressure (because bonds are an alternative to RE from an investment standpoint).

Aside from the leverage issues other point out in RE, you have to consider the political risk. How safe do you feel that a piece of paper saying that plot of land is yours will hold up when there's a raging mob threatening politicians to do something about homelessness/housing prices/AirBnB/Asset managers holding all the properties? The political risk in the West is at Emerging Markets levels. We've seen G7 nations d…

Seriously? You think things are going to get so bad the government seizes real estate en masse? That's not going to fly in the U.S. for one second.

Re: How This Ends

#327

Post by zw123456 »

randomsearch wrote: post #81
zw123456 wrote: post #49

One factor that I think might be different this time than from the 1980's is productivity increases from WFH. There are a number of studies showing that WFH has resulted in an increase in overall productivity. And has also helped curtail the demand for gas, although that is picking up. It remains to be seen if the Fed can wrangle the so called "soft landing", but productivity increase could potentially make that a bi…

That can’t possibly be true, right? GDP plummeted and employment is high, so productivity can’t have increased…

https://www.apollotechnical.com/working-from-home-productivi... there are other studies if you just search on productivity and WFH

Re: How This Ends

#328

Post by baxtr »

eezurr wrote: post #223
ChrisMarshallNY wrote: post #83

> I would be planning to ride this thing out for at least eighteen months or more. I'm betting more like three to five years. I was talking to a friend (another old guy, like me, but really rich, unlike me). We've both been through at least two recessions (big, nasty ones, with teeth and claws). We realized that there's an entire generation of folks; many running companies, that have never seen a real bear market. It…

>We realized that there's an entire generation of folks; many running companies, that have never seen a real bear market. This is true for every recession, so maybe rethink your friends logic.

That's exactly what people said back in 2008. "It happened in part because most of these finance people weren't around to experience the dot-com crash in 2000".

Re: How This Ends

#329

Post by kache_ »

mym1990 wrote: post #142

My view is that capital and investment will dry up and companies that are operating at a loss(many in tech right now) will either have to downsize or close up completely. This will cause a domino effect. People will lose jobs, and some of those people will have bought a million dollar shack in the past 2 years and they might have to sell at a loss or foreclose. Generally I think we have yet to see any real macroecono…

what's the most expensive SaaS that other SaaS use out there? The first one to go? I'm thinking distributed tracing companies are going to get pwn'd

Re: How This Ends

#330

Post by electrondood »

jeffbee wrote: post #140
herf wrote: post #28

I agree we are working through an asset bubble in tech and housing - P/E's went quite a ways above the historical line, as did housing prices. But think about the chip shortage (automotive, consumer electronics) - raising interest rates does not "fix" supply and make prices lower. Think about oil & gas markets. Think about labor shortages. When supply is broken, it's not only a monetary policy problem. Most of these…

Housing is not a bubble, at least not in the U.S.A. The prices are supported by a fundamental shortage of the product. It is not driven by speculation but demographic pressure.

I think there's been quite a lot of speculation in RE, actually. With rates so stupidly low, people have been purchasing rental properties as the only other investment besides stocks that made any sense in the last 2 years.
Post reply on HN