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What if your entire worldview was just because of near-zero interest rates?

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Re: What if your entire worldview was just because of near-zero interest rates?

#81

Post by mc32 »

rayiner wrote: post #73

I suspect near-zero interest rates for a decade also contributed to the political realignment of affluent suburbs trending Democrat. So long as the Fed would buy federal debt cheaply and there was no significant inflation, Democrats could advocate multi-trillion social programs while promising to maintain Reagan-era tax rates on even quite affluent folks.

I want to know what happened to the promised "Peace Dividend". Military spending was supposed to go way down, not just down, and civilians were supposed to reap the benefits... Instead Industrialists took up the Globalization mantra and forgot the little guys (the guys and gals working in factories) and happily told them it would mean lower cost of living --conveniently leaving out that they would also earn much less, if they even got to keep their jobs.

Ross Perot and Bernie Sanders warned people, but they were made fun of and now Bernie has sold out and pretends.

Re: What if your entire worldview was just because of near-zero interest rates?

#82

Post by cma »

rayiner wrote: post #73

I suspect near-zero interest rates for a decade also contributed to the political realignment of affluent suburbs trending Democrat. So long as the Fed would buy federal debt cheaply and there was no significant inflation, Democrats could advocate multi-trillion social programs while promising to maintain Reagan-era tax rates on even quite affluent folks.

Am I misremembering or.. didn't republicans with full control of congress do the tax breaks while increasing spending and later, in partnership with dems after losing congress, expanding social programs like Obamacare to be more universal (free pandemic-related care)?

Biden's eventual infrastructure bill also was smaller in scope than Trump's proposed one that wanted $2 trillion instead of $1 trillion.

Re: What if your entire worldview was just because of near-zero interest rates?

#83

Post by balsam »

CoastalCoder wrote: post #49

> "What if your entire worldview was just because of near-zero interest rates?" Worldviews typically include who we are, why we're here, what purpose (if any) we have in life, etc. It seems strange to me that someone's worldview could be thoroughly based on interest rates.

The worldviews of the originators of HN and YC are probably built on cheap debt. Airbnb may have revenue, but I would say its their stock sales to speculators, also burgeoned by cheap debt, that resulted in these VCs thinking they are smarter than everyone else. Now that they are smarter than everyone else, their purpose in life is to tell people what they should do, how they should live, like the puritans of old. Get frustrated by other smart people who didn’t get their self-assurance from God or Market given prosperity. Thats a worldview ain’t it.

Re: What if your entire worldview was just because of near-zero interest rates?

#84

Post by sennight »

CoastalCoder wrote: post #49

> "What if your entire worldview was just because of near-zero interest rates?" Worldviews typically include who we are, why we're here, what purpose (if any) we have in life, etc. It seems strange to me that someone's worldview could be thoroughly based on interest rates.

> Worldviews typically include..

For people who are their own favorite subject, maybe. For everyone else it is an internal model of the way the world works, which allows you to make sense of things. So when you are interested in the way the world actually works, not how you feel it should work, economics is very important.

Re: What if your entire worldview was just because of near-zero interest rates?

#85

Post by EdwardDiego »

neilv wrote: post #48

> It became the new normal, and the generation that entered Wall St. during this time is now disoriented, for they “do not know a world without cheap money.” [...] Whenever people are humbled by the melting away of things they took for granted, now that’s a topic worth exploring. I'm trying to figure out parallels and implications for tech jobs. Where in tech jobs will be first to decide they need to "rediscover the…

I'm waiting for the inevitable swing back from the Clouds to colos and dedicated DCs. Eventually, the cost difference is going to get a bunch of CTOs twitching.

I mean, the fact that "cost engineering" is an often used term these days makes me sad.

Re: What if your entire worldview was just because of near-zero interest rates?

#86

Post by WrtCdEvrydy »

EdwardDiego wrote: post #85
neilv wrote: post #48

> It became the new normal, and the generation that entered Wall St. during this time is now disoriented, for they “do not know a world without cheap money.” [...] Whenever people are humbled by the melting away of things they took for granted, now that’s a topic worth exploring. I'm trying to figure out parallels and implications for tech jobs. Where in tech jobs will be first to decide they need to "rediscover the…

I'm waiting for the inevitable swing back from the Clouds to colos and dedicated DCs. Eventually, the cost difference is going to get a bunch of CTOs twitching. I mean, the fact that "cost engineering" is an often used term these days makes me sad.

In the background, it's already happening for test and dev environments.

The technical term is "repatriation" and I can tell you those snowballs coming from S3 to your onsite aren't just for looks ;)

Re: What if your entire worldview was just because of near-zero interest rates?

#87

Post by ericpauley »

015a wrote: post #47
awinder wrote: post #11

“All of this has led to weird idiosyncrasies, euphoria, and contradictions. Stocks ballooned, tripling in value since 2009” This is like 9% compounded for 13 years, which is in line with historic averages.

The iShares S&P 500 ETF has returned about 11.6% annualized over the past ten years. Their Ex-US ETF: 2.8%. Point being: the third variable no one ever takes into account when considering Buffett's advice: "just invest in broad market indexes" literally only works in the US, and only has worked historically . It's not a coincidence that the US is the youngest developed economy on the planet. In other words: How high…

The US is at least as old as the concept of a contemporary “developed economy”, so it doesn’t seem like this part of the argument holds.

Re: What if your entire worldview was just because of near-zero interest rates?

#88

Post by lettergram »

lokar wrote: post #13

People who complain about extreme fed policy should look to congress. The inability of congress to address core economic and financial issues forces the feds hand.

Lol “forces the feds hand”

Congress, in part because of the fed, doesn’t have the ability to regulate it. This is why Andrew Jackson originally dismantled the second bank of the United States (the irony of him being on the $20 federal reserve note is painful).

The way the fed really works is that those closest to the supply of money get a higher valued dollar. During the pandemic the fed was straight up letting certain entities have the funds first (black rock, for instance). Then they were buying junk bonds and deciding winners and losers

https://www.federalreserve.gov/monetarypolicy/pmccf.htm

Who owns the fed? Where are the audits?

https://m.youtube.com/watch?v=HRduwYgrU7A

I seriously don’t understand why congress doesn’t even bother to audit the FED. The only reasonable explanation is corruption

Re: What if your entire worldview was just because of near-zero interest rates?

#89

Post by ch4s3 »

rayiner wrote: post #77
thatguy0900 wrote: post #38

Earlier quoted context omitted.

Well just keep desperately importing people from other countries, unlike Japan and Co. Or, for the other side of the political spectrum, ban abortions/birth control.

While slowly turning the country into Bangladesh. Fantastic.

We have a TON of space, unlike Bangladesh and we’re already a developed economy with strong institutions and rule of law. From a lot of vantage points, the US has enviable problems.

Re: What if your entire worldview was just because of near-zero interest rates?

#90

Post by BirdieNZ »

qudat wrote: post #54
blockwriter wrote: post #32

My friend that has been a general contractor for around ten years acts like it's not even worth doing his job anymore now that interest rates are going up.

Contractor we use says they’ve got a 1-2 year lead time and very busy schedules. Who knows, maybe that’ll drop off in a few years

In New Zealand we have a sharp cliff of building contracts; they're insanely busy for maybe another year at most, and then nothing new is in the pipeline. Building contracts pan out over years, and interest rates flow into property prices rather slowly compared to share markets.
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