81–90 of 1001 posts
Capitalism is good, but some amount of principles (like treating employees fairly, not pillaging the environment etc) with capitalism would be nice. Instead the only thing that matters today is profit, at the expense of everything/everyone else
> Meanwhile, renters are desperate. They’re begging for housing prices not just to slow, but to fall. I have a friend who is a head chef at a decently popular bar and restaurant on Broadway in Capitol Hill, Seattle (very trendy part of town if you aren't familiar, steep commercial rent). He lives in a 400 sq ft studio and is barely, barely making it from one paycheck to the next. I am sitting on a 2.6% interest rate…
I majored in economics and it still boggles my mind what we make as software engineers versus the guy who unclogged my sewer drain allowing me to use the toilet.
> Meanwhile, renters are desperate. They’re begging for housing prices not just to slow, but to fall. I have a friend who is a head chef at a decently popular bar and restaurant on Broadway in Capitol Hill, Seattle (very trendy part of town if you aren't familiar, steep commercial rent). He lives in a 400 sq ft studio and is barely, barely making it from one paycheck to the next. I am sitting on a 2.6% interest rate…
I majored in economics and it still boggles my mind what we make as software engineers versus the guy who unclogged my sewer drain allowing me to use the toilet.
Will GPT-6 replace some subset 10..80% of engineering, law, medical hours? absolutely
That implies housing has risks. Since 2009, that risk has been eliminated by the FED owning 30% of all mortgages on its balance sheet. We've nationalized housing risk and privatized the gains.
1. In our highly financialized society, and with many of us essentially worshipping money, it first needs to be said that not every choice needs to be financially optimal to be the best choice for your life. Buying a home is not just a financial choice, but a lifestyle change. They work with different units so the math cannot cross over, save for maybe considering comparable goods/utility in an economic sense (what else could you do with the same financial outcomes, which do you prefer)
2. Buying a house comes as a mix of rarifying asset, high value depreciating good, and liability. The land in a growing city is increasingly becoming rare (like the art example in the article), a depreciating house (eg, depreciate your roof over 20 yrs, your hot water tank over 5-10 etc), and a liability -- you now have to pay HOA + taxes on the value of the property until disposed of. (And note the steep exit fee that using a realtor costs. That significantly eats into your appreciation)
3. Because your house's rental market value is roughly proportional to it's underlying asset value, the more your house appreciates, the more marginal opportunity you give up by living in it. That is, you essentially are consuming the rental value of the house as a lifestyle choice -- that's essentially the definition of a liability, therefore 4.
4. The home you live in is a liability (a recurring cost center and lost opportunity cost, potentially still at net profit after the appreciation of the land), a property you rent out is an income producing asset (potentially still at a loss after expenses).
5. Anecdotally, most people who I have seen swear they made "so much money" on their home are actually failing to do the math well. Total cost of ownership of a home + buy/sell transaction costs + tax burden + maintenance + lost opportunity to invest in other assets has rarely, if ever, been profitable in my maths. Speculating on distressed assets at market bottoms or other contrarian times would be the exception, but that can be very profitable for experts with capital in most any asset market (eg used cars made money for a few years there).
Buying a house is an investment. You're making a bet that worker productivity will improve near you. After all, what is the value of land? Some land can be farmed or house a factory. But usually, when we talk about residential real estate, we're talking about land that houses workers. So, the value of that land is directly proportional to the economic value those workers can provide. We refer to "economic value provi…
Is worker productivity going up?
Earlier quoted context omitted.
I majored in economics and it still boggles my mind what we make as software engineers versus the guy who unclogged my sewer drain allowing me to use the toilet.
The fruits of your labour can be sold continuously at low marginal cost. His cannot.
> Meanwhile, renters are desperate. They’re begging for housing prices not just to slow, but to fall. I have a friend who is a head chef at a decently popular bar and restaurant on Broadway in Capitol Hill, Seattle (very trendy part of town if you aren't familiar, steep commercial rent). He lives in a 400 sq ft studio and is barely, barely making it from one paycheck to the next. I am sitting on a 2.6% interest rate…
With inflation my budget is drastically tighter than just a few years ago.
> Meanwhile, renters are desperate. They’re begging for housing prices not just to slow, but to fall. I have a friend who is a head chef at a decently popular bar and restaurant on Broadway in Capitol Hill, Seattle (very trendy part of town if you aren't familiar, steep commercial rent). He lives in a 400 sq ft studio and is barely, barely making it from one paycheck to the next. I am sitting on a 2.6% interest rate…
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