161–170 of 385 posts
There are 1.034 million vacancies and 3.277 million people without work that want it. There isn't a shortage of labour. There is a shortage of decent pay and conditions. Firms are going to have to get over their cheap labour obsession or close and leave the market to those firms that can.
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Wage rises without solving the housing issue is only going to raise house prices further. There's a bunch of potential solutions, but no-one directly benefits from them in the short term. Any attempt to fix it will be met with sob stories about old ladies in multi-million dollar homes being "forced out of their homes". So we'll all just sit and watch as things slowly spin out of control.
> "Wage rises without solving the housing issue is only going to raise house prices further." House prices aren't that tightly linked to incomes. House prices are more strongly influenced by interest rates and availability of credit. And, of course, supply/demand fundamentals (ie: population change vs. number of housing units in an area).
If I was, then I'd say a system where the government basically gives you free money/tax breaks if you buy a home, is the root cause behind the things you mentioned which then drives house prices.
The point is, without fixing that issue, you can't solve it by wage rises.
People who don't even want homes are buying them, either as outright investments that they can sit on for years, or as something they also live in, but need to treat as an investment, rather than a home.
Earlier quoted context omitted.
Wage rises without solving the housing issue is only going to raise house prices further. There's a bunch of potential solutions, but no-one directly benefits from them in the short term. Any attempt to fix it will be met with sob stories about old ladies in multi-million dollar homes being "forced out of their homes". So we'll all just sit and watch as things slowly spin out of control.
> "Wage rises without solving the housing issue is only going to raise house prices further." House prices aren't that tightly linked to incomes. House prices are more strongly influenced by interest rates and availability of credit. And, of course, supply/demand fundamentals (ie: population change vs. number of housing units in an area).
I guess on the one hand businesses aren't paying enough. But I mean, business owners aren't all just evil conspiring anti-labor types. They're in it for the profits and would pay more if they could eek out a reasonable return on investment. On a deeper level, you have all these zombie-businesses now supported by government handouts and terribly low interest rates. The zombie businesses soak up labor for relatively le…
Zombie businesses required to pay more for labour go bust. Raising the cost of labour is a far more reliable way of eliminating zombies than attempting to raise interest costs. No business can operate without labour.
They may survive for a long period of time in a perma low interest rate environment where debt has become cheap and stocks are highly inflated. Low interest rates, as well as enabling debt accumulation, also float the stock market, which provides shareholder dilution-based funding to businesses that otherwise would have far more severe problems.
Uber is an ongoing example of that. Previously they abused venture capitalist institutional money to get by, now they're living as a parasite on shareholders (who are hoping that something changes about the financials in their business, some day, some how).
Tech hasn't had a good 'ol brush fire clean out of garbage in a long time now.
Companies like Snowflake that are bleeding enormous sums of money, would collapse in a traditional 1990-1991 or 2001-2002 style recession. Snowflake is similar to any number of supposedly fast growing, huge loss-making companies like Exodus Communications from the dotcom era, that imploded when the music stopped (and so many of their business clients pulled back on spending). Snowflake's sales over the last four quarters: $851 million, their operating loss over that time: $775 million. They would instantly shatter if a real recession hit, the stock would drop by 95% rapidly. There is a lot of that garbage floating around the tech space these days, because we haven't had any good clearing fires in a long, long time.
this is good for wages but I am concerned about the resulting inflationary pressure.
There is always some inflationary pressure when inequality is reduced. For example, very few can support nannies and home servants like they could in the past (and like in India now), when poor people’s wages were so low that they would give up their life to support anyone that owned land. The only way to prevent inflation is with technology and productivity, for example, people today could have home servants in the…
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Build more housing. A lot more housing. A good portion of it should be publicly owned.
Existing owners won't let you do that, as it would depreciate their real estate portfolio.
Most other things like art, actual innovation, and child rearing are going to migrate to medium sized cities, towns, and the countryside for basic economic reasons. It's already slowly happening.
Good. Wages must be forced up. You can’t have a modern economy without a capitalized middle class. Real estate is so ludicrous we need quite a bit of inflation to make it reasonable again. The alternative would be a deflationary crash where real estate crashes and obliterates everyone’s home equity, but that is far more painful to virtually everyone.
Don't house prices usually go up with inflation?
When a few companies or industries can’t find enough labor, the solution is simple: Raise wages to attract a larger percentage of the labor pool. When every company and industry is struggling to hire, raising wages is still necessary but it no longer fixes the bigger problem. Those higher wages aren’t producing more labor, they’re just convincing employees with jobs to switch to other jobs. Switching jobs creates a v…
https://www.bls.gov/charts/employment-situation/civilian-lab...
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Or just increase wages and increase prices.
Second part is not that simple in global economy if you have Chinese cheap labor as direct competitors especially in the food industry where margins for farmers are already too low. I would recommend Jeremy Clarkson - "Clarkson's Farm" first year of operation on a 300 acres farm made a yearly profit of £144 :)
Just because there aren't any monetary profits doesn't meant that we didn't become wealthier in the process. Profit and wealth is not the same thing.
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> Real estate is so ludicrous we need quite a bit of inflation to make it reasonable again. Alternatively, we could invest in rural areas and other left-behind areas ("flyover states" in the US, Eastern Germany in Germany). Right now, the infrastructure there is flat-out unable to sustain quality modern human life unless you're Amish and fine with travelling on horseback: no high speed internet, no public transport,…
UK has excellent rural areas so although that might help in America keep in mind it hasn't helped in the UK.