2 hours ago, Brutus_buckeye said:

as a matter of fact, i have spoken to a number of unbiased people on the matter. I have people who love their EV but still lament how it takes longer to make a drive to a place like Chicago because of the charging situation and the lack of infrastructure. Yes, in an ideal world you could make it on one charge, but that does not take into account potential cold weather shortening battery life, lack of available charging stations on the ride, and time to charge. If you hit traffic and you are at 20% do you want to risk a long back up and having your battery die or is it best to be on a full battery? THese are all issues and concerns that are often overlooked by many EV enthusiasts. It will take longer to drive with the EV.

 

Charging is another issue. THe SUperchargers are nice, but if you use them too much they will harm your battery life. I learned this from the people that actually make these charging stations because we were looking at installing them at some commercial properties and realize that these charges (on top of the costs) may not be the ideal solution either. So those are not great for those who travel a lot since they will hurt the long term battery life. 

Yes, but you look at weekly charging is something that people can build into their busy schedules and it will be no issue. how many of these people rent? How many landlords are going to want to invest in the equipment. DC fast chargers as mentioned above, are bad for battery life, so you do not want to make a habit of using them. Also, DC fast chargers cost over $100k per station to install. Many property owners, especially owners of working class properties will not pay for this amenity. High end apartment owners will, but that again does not help the poorer working class individual.

 

Your flippant response about bias, shows you really know little about the infrastructure problem and are willing to just gloss over the significant problems to lower income individuals because their problems do not really effect you, and you like the idea of EV's despite their issues. 

I too love my EV, but lament that it takes longer to take on long trips.  My point was that 8 hours for a 5 hour trip is a ridiculous exaggeration of the time penalty for driving an EV.  It’s already much closer than that, and EV range and charging speeds are both steadily improving.  If I hit traffic at 20% battery, I take solace in knowing that my car uses almost no energy when it’s not moving, and that moving slowly is dramatically more efficient, so I’ll be fine getting to my destination.  This is not a concern that’s overlooked by EV enthusiasts; it’s one of many factors that are weighed in deciding if an EV works for your use case.

 

Fast charging has so far shown to not be as detrimental to battery life as was initially thought:

https://www.recurrentauto.com/research/impacts-of-fast-charging
This will continue improving as battery chemistry is improved.  Lithium Iron Phosphate is becoming very common and is much better in this regard.

 

I think you misunderstood my suggestion of weekly fast charging.  There are fast chargers at places like Walmart and Meijer, so someone without access to a daily charger could plug in for 45 minutes while shopping for groceries at one of those places and be good for the week.  Just like getting gas for the week.  Maybe it takes longer, but if you spend that time doing something you would have anyway, it’s not a big inconvenience.

 

No one is suggesting DC fast charging for apartments (maybe you’re thinking of 240 V AC charging, which is far cheaper).  I’m fully aware of the infrastructure issues, but they’re not insurmountable, and the solution certainly isn’t to give up and continue burning fossil fuels.  And if we invest in the infrastructure, vehicle operation will be far cheaper for lower-income people (by virtue of lower operating costs, smaller-battery options, fewer health problems from tailpipe emissions, etc.)

2 hours ago, brtshrcegr said:

These are only issues to those unfamiliar or new to driving EV cars. You quickly get a handle as to what 20% range in your vehicle means, and how long you can go before you will need to find a charge point. No different than when you see 20% gas remaining in your ICE car. We are so used to it in ICE cars, but we are always making a risk calculation as to how far we need to go before we need to pull over to refuel, whether with petroleum or electricity. I’ve run out of “gas” multiple times in an ICE car, and never in an electric car. So, for me, I know which one is more likely to leave me stranded. 

While much of this may be in the preference of the driver or the owner, the biggest flaw that the EV has is delivery and the inefficiencies in charging vehicles. Ultimately, the lack of efficient charging stations that can be provided to serve the masses, especially more lower income and middle income people who do not have ability to put an EV charger on their property is a significant flaw with the whole EV infrastructure, unless the goal is to make sure that lower income individuals can no longer have cars.

2 minutes ago, acd said:

No one is suggesting DC fast charging for apartments (maybe you’re thinking of 240 V AC charging, which is far cheaper).  I’m fully aware of the infrastructure issues, but they’re not insurmountable, and the solution certainly isn’t to give up and continue burning fossil fuels.  And if we invest in the infrastructure, vehicle operation will be far cheaper for lower-income people (by virtue of lower operating costs, smaller-battery options, fewer health problems from tailpipe emissions, etc.)

Not just apartments. Although they are expensive for an apartment owner to install regardless. However, there are a lot of renters who live in urban areas without parking and have no easy access to a charger. Go to CHicago. How many people live in 3-4 unit flats and have no driveway. The residential streets are often lined with parked cars. These people cannot charge up overnight because you cant place chargers on every meter or parking spot on the street. So they must charge in a large commercial parking lot if one is available. Spending 1-3 hours to give your car a full charge is quite a pain in the butt compared to spending 5 minutes at the gas station. 

This article on Reuters.com is interesting.  I wonder how well it will work out.  One item mentioned was that a chip maker Micron is building a chip factory (not the potato chip kind) in Clay, NY, north of Syracuse.  

 

Biden administration picks 31 regional tech hubs to spur US innovation

I guess the question is, how are things going for you? 

 

The Annoyance Economy

Data alone don’t capture how frustrating and stressful it is to be a consumer right now.

https://www.theatlantic.com/ideas/archive/2023/10/american-economy-consumer-confidence/675687/

 

I can't imagine anyone outside the top five or ten percent are actually thriving these days. Between what feels like the early stages of World War 3 in Ukraine/Russia and now Israel/the world, a potential civil war brewing internally, cost-of-living at unlivable levels (regardless of inflation's bulls**t metrics), wages dogs**t for most of the country, crime at unacceptable and costly levels, city budgets and essental infrastructure  collapsing due to migrant crisises and legacy debts, endless layoffs in every field, and the upcoming commercial markets doomsday, yeah, it's been a pretty rough year. A rough 22 years really.

 

That 3.7 percent unemployment and 300k+ jobs last month just doesn't balance all those other burdens.

 

Edited October 23, 20231 yr by TBideon

3.8% unemployment doesn't mean much if people aren't making enough money to maintain their lifestyle. I actively feel like my quality of life has dropped in the last 4 years despite keeping the same job and salary. That's frustrating and I imagine it's a very common feeling.

Housing in Columbus is absolutely bonkers. You'd think higher interest rates would bring it down but the need outpaces the interest rate difference. And large multifamily projects have gone on hold due to rate hikes.

Edited October 23, 20231 yr by GCrites

It's rough everywhere, but in places with rapidly growing populations like Columbus, finding a quality home must be particulary agonizing.

 

Cities/regions in which significant population disappeared are packed with low income or working class neigborhoods full of starter and reasonably priced homes (of varying quality). Those options just aren't available in places with serious population growth. 

 

Add in the mind-boggling costs of building a new home these days, and developers don't have any incentive to build anything other than "luxury", aka mid-6 figures for fake marble counters and fake brick facades.

1 hour ago, GCrites said:

Housing in Columbus is absolutely bonkers. You'd think higher interest rates would bring it down but the need outpaces the interest rate difference. And large multifamily projects have gone on hold due to rate hikes.

 

High housing costs due to a housing shortage will not come down by raising interest rates in order to tamp down on housing construction.

1 hour ago, X said:

 

High housing costs due to a housing shortage will not come down by raising interest rates in order to tamp down on housing construction.

That is correct, the way to bring them down is to remove red tape to make it easier to develop or redevelop properties and to limit the rights of the NIMBY's

There are so many factors that have led to housing shortages. Regardless of eliminating red tape (whatever that entails) and NIMBY obstruction, the price and availbility of materials and labor are not contracting anytime soon.

3 hours ago, TBideon said:

It's rough everywhere, but in places with rapidly growing populations like Columbus, finding a quality home must be particulary agonizing.

 

Your comment prompted me to check out a few Appalachian Ohio towns just to see what price trends have been like on places expected to be on the other side of the coin, so to speak.  Just based on a few quick searches, it looks like prices have been skyrocketing there since COVID, too.  (I just checked Waverly, Portsmouth, and McConnelsville, chosen at random.)  Obviously still mostly lower in terms of raw dollar numbers, but in terms of percentage increases, the medium-term trend doesn't appear to be all that different.  And because raw sale prices are lower, you also wouldn't expect to see a ton of new construction there, given the increased labor and materials costs of new constructions, even if the land were free.  I honestly don't know what the way out is.  It's the kind of hopelessness that makes people pine for currently pie-in-the-sky ideas like 3D printing houses.

13 minutes ago, TBideon said:

There are so many factors that have led to housing shortages. Regardless of eliminating red tape (whatever that entails) and NIMBY obstruction, the price and availbility of materials and labor are not contracting anytime soon.

There are, but one way to lower the cost of doing business is to speed up the approval process and allow things to be done without as much red tape. Instead of needing 5 duplicative departments to sign off on a permit, it can and should be streamlined. The process also allows NIMBYs to frustrate the process by gumming up the process with one of these departments. This is a significant cost to do business. 

 

Eliminating red tape will also speed up the material delivery process and cause fewer delays which, impact the cost of the project. It will also lower material cost too. 

 

Labor may not be going down now, and prices will remain high until there is a recession that causes a labor demand contraction but there are other ways to reign in costs outside of labor. This will not make it cheap to build, but it will encourage more units coming to market and help to alleviate shortages. 

Nobody with a 3% mortgage is selling or moving.  They're also unmotivated to rent spare bedrooms because they can easily afford their current costs.  Young adults are making enough money to not be forced to move back in with family members.  That's why the housing supply is so low right now. 

 

During the 2009 recession, so many people lost their jobs and moved back in with family members that there weren't enough renters to fill existing apartment buildings.  Rents dropped.  Prices of homes and multifamilies dropped.  Also, there was still tons of crime in the cheap areas. 

 

 

Those are some interesting assumptions. I agree with your first and last three sentences somewhat, though prices rapidly rebounded in '09 after bottoming out that summer.

19 minutes ago, Lazarus said:

Nobody with a 3% mortgage is selling or moving.  They're also unmotivated to rent spare bedrooms because they can easily afford their current costs.  Young adults are making enough money to not be forced to move back in with family members.  That's why the housing supply is so low right now.

 

Except that this leaves out a missing link: If prices are so high and demand is so high, and builders would have little competition from people selling their existing homes (based on your theory), where is all the new construction that ought to be in the pipeline?  Your argument here would, if accepted, explain why existing homes aren't hitting the market.  Without more, it cannot explain why new construction is not filling the market need.

48 minutes ago, Gramarye said:

 

Except that this leaves out a missing link: If prices are so high and demand is so high, and builders would have little competition from people selling their existing homes (based on your theory), where is all the new construction that ought to be in the pipeline?  Your argument here would, if accepted, explain why existing homes aren't hitting the market.  Without more, it cannot explain why new construction is not filling the market need.

The demand is there but the interest rates make the construction unfeasible. To get a project off the ground there are a few components to financing and the price of the loan is based on the after construction value of the property. When rates are 3-4% that is easy for developers to finance.  When rates go to 8% that changes the construction assumption quite a bit. Even though the demand is there, the developer now has to carry the debt at 8% instead of 4% over a period of 2 years to complete the project. That is a lot more money. THen, you have the assumption that the economy will be the same once completed or better, and it will allow the developer to lease that project. If, after 2 years, the economy is in the tank, the developer is left holding the bag on a property that cannot be leased up (at projected rates). Couple that with the fact that at current rates, bank regulators have imposed more stringent capital requirements on lenders and developers are having to come up with more equity to get the project off the ground. 2 years ago, the developer could finance 85% of the project. Today, the developer will likely need to bring 1/3 of the money to the table. 

 

All of this increases the risk and challenges to the developer making it difficult to get a project off the ground. Remember, the projects are often 2-4 years in the making so a lot can change during that time frame, even if demand is off the charts right now. 

5 minutes ago, Brutus_buckeye said:

The demand is there but the interest rates make the construction unfeasible. To get a project off the ground there are a few components to financing and the price of the loan is based on the after construction value of the property. When rates are 3-4% that is easy for developers to finance.  When rates go to 8% that changes the construction assumption quite a bit. Even though the demand is there, the developer now has to carry the debt at 8% instead of 4% over a period of 2 years to complete the project. That is a lot more money. THen, you have the assumption that the economy will be the same once completed or better, and it will allow the developer to lease that project. If, after 2 years, the economy is in the tank, the developer is left holding the bag on a property that cannot be leased up (at projected rates). Couple that with the fact that at current rates, bank regulators have imposed more stringent capital requirements on lenders and developers are having to come up with more equity to get the project off the ground. 2 years ago, the developer could finance 85% of the project. Today, the developer will likely need to bring 1/3 of the money to the table. 

 

All of this increases the risk and challenges to the developer making it difficult to get a project off the ground. Remember, the projects are often 2-4 years in the making so a lot can change during that time frame, even if demand is off the charts right now. 

Yep, interest rates and material costs are making it almost impossible to get get new builds going.

4 hours ago, TBideon said:

There are so many factors that have led to housing shortages. Regardless of eliminating red tape (whatever that entails) and NIMBY obstruction, the price and availbility of materials and labor are not contracting anytime soon.

 

There is a lot of red tape in Columbus. We are in the middle of a revamp on our 1950s-era zoning laws in the city and a lot of our suburbs are difficult to deal with. Now Lancaster is an example of a developer-friendly city in the metro but its population and growth rate aren't super high. Just too far away from the good Dublin/Worthington/Westerville/Polaris jobs.

8 hours ago, Ineffable_Matt said:

Yep, interest rates and material costs are making it almost impossible to get get new builds going.

 

Also, unlike in the 1980s and 1990s when subdivisions full of 2,000+ sq foot homes were going up everywhere, much of the construction labor force across the United States is tied up doing flips and renovations in homes and apartment buildings of all eras and all sizes. 

 

It's pretty common to see prewar and postwar apartment buildings around Cincinnati emptied out and redone with new kitchens, bathrooms, floors, etc.  The original kitchens and floors were perfectly fine for the past 50-100 years but now the market will pay a premium to live in a renovated unit.  The owners have done the math and they expect to come out way ahead by giving up several months' rent and dropping $50,000 per unit (or much more) on renovations.

 

I have mentioned it here on this forum before but it bears repeating - there was almost no such thing as a home renovation for long-time residents or a full house flip until HGTV, etc., popularized the idea.  Yes, people did finish basements, but they didn't spend $30,000 completely rebuilding a perfectly functional kitchen or bathroom.  I also never saw an apartment building that got renovated to the extent that they are commonly renovated today. 

 

For example, the former Forum Apartments complex on Martin Luther King Drive was built around 1970.  It was just renovated into "The Heights Apartments":

https://theheightsbyalbion.com/#gallery

 

 

6 hours ago, Lazarus said:

For example, the former Forum Apartments complex on Martin Luther King Drive was built around 1970.  It was just renovated into "The Heights Apartments":

https://theheightsbyalbion.com/#gallery

 

That grey fake wood flooring is the trend that just won't die

 

The greatest con the building industry has pulled lately is convincing people of all stripes that cheap hideous vinyl floors somehow equal 'luxury' ✨

2 hours ago, NW24HX said:

 

That grey fake wood flooring is the trend that just won't die

 

The greatest con the building industry has pulled lately is convincing people of all stripes that cheap hideous vinyl floors somehow equal 'luxury' ✨

Yeah I can’t stand vinyl flooring. I get it in new builds that didn’t have exhausting floors, still doesn’t look good. Hate it when people come into an old house or apartment complex and rip out the original hardwoods and replace it with that crap. 

3 minutes ago, VintageLife said:

Yeah I can’t stand vinyl flooring. I get it in new builds that didn’t have exhausting floors, still doesn’t look good. Hate it when people come into an old house or apartment complex and rip out the original hardwoods and replace it with that crap. 

Often they put in right on top of hardwood floors. In that case, it can be easily removed with the wood floors intact. 

9 hours ago, Lazarus said:

I have mentioned it here on this forum before but it bears repeating - there was almost no such thing as a home renovation for long-time residents or a full house flip until HGTV, etc., popularized the idea.  Yes, people did finish basements, but they didn't spend $30,000 completely rebuilding a perfectly functional kitchen or bathroom.  I also never saw an apartment building that got renovated to the extent that they are commonly renovated today. 

It is a lot of money coming in from the Coasts that are doing this. They do not understand the market and just look at aggregate numbers. They see a "housing shortage" or "low rents" compared to other markets and see the opportunity to drastically raise rents if they put a ton of money into renovating a tired "C" class apartment in a "C" class location. 

 

Dont get me wrong, many of these tired units need upgrades and you can make them look very nice by putting in the fresh vinyl floors and new builder grade cabinets or even just adding a dishwasher. However, adding subway tile in the showers and granite counters as well as tile backsplashes are a waste of money when your average resident is going to still be a similar "C" class level resident that was there before. 

 

The Forum may have been a very nice building in the 60s but preferences have changed. It is not walkable to anything and does not really offer much in view. What may have been the "Prime" location in the 1960s is no longer considered preferable as people want to have amenities near their units and some level of walkability, even if it is to a strip mall next door to get their morning Starbucks or chicken wings.

52 minutes ago, freefourur said:

Often they put in right on top of hardwood floors. In that case, it can be easily removed with the wood floors intact. 

Yeah, that is 100% fine, but I’ve seen it torn out and just tossed in the dumpster. 

On 10/18/2023 at 1:27 PM, Foraker said:

Then the programs need to be adjusted, not eliminated.

 

Again, this is in the design of the programs not the programs themselves.  Maybe what is needed is "here is your housing voucher for three years.  After two years, make an appointment with a counselor and we will review how we can help you find better housing" or something -- rather than "if your income exceeds X we are going to take away your support."  Maybe if we actually let people exceed the income threshold for a short period of time they can build up a nest egg, get a better car, get some bills paid off, whatever -- so that then they can stand on their own, rather than pulling the support the minute they get slightly ahead in life. 

 

Another alternative -- just give poor people the cash that all of these government programs cost to run.  IF people truly want independence, then they won't want to stay on the dole. 

 

On 10/18/2023 at 1:59 PM, Brutus_buckeye said:

Remember when Congress in the 90s passed welfare reform and it actually worked. THis is what you are describing.

It only took a generation for the progressive class to tear it down though.

The "progressive class" has not had a majority in either Ohio or Congress since welfare reform was passed around 1996.  However, there have been numerous Republican majorities in Congress since then.... and I can't name any changes to welfare that have been made by Republican legislators since 1996 that reduced deep poverty, which was not significantly improved by the 1996 welfare reforms.

 

Quote

Thus far, we’ve considered welfare reform as a whole, but the law
actually comprises many different pieces—work requirements,
time limits, sanctions, block grants, and much more. Did caseloads
decline because of work requirements? Did employment
increase because of sanctions? What role did block grants play?
Unfortunately, the research to date has not succeeded in
disentangling the relative contributions of each of these components.
. . .
Additionally, the different components of welfare
reform are complex and correlated with each other within states,
making measurement difficult.
. . . .
Did it reduce poverty? There are two sides to the answer to this
question. It would appear that, while welfare reform assisted
families with incomes close to the poverty threshold, it did less
to help families in deep or extreme poverty. Under the current
welfare regime, many single mothers are struggling to support
their families without income or cash benefits. Even women
who are willing to work often cannot find good-paying, steady
employment.

https://inequality.stanford.edu/sites/default/files/Pathways_Winter2018_Employment-Poverty.pdf

 

So yes, there were some positives from welfare reform.  Those reforms, however, were not "undone" by progressives (who have not been in power since and would dramatically change the current welfare system if permitted to).  More needs to be done, and Republicans have no plans to reduce poverty, only plans to reduce welfare payments (other than the corporate kind).

Lael Brainard has proposed a new federal program to convert empty office buildings to affordable residences.  Seems as if Cleveland and other places have shown that another federal program is not needed.

 

https://thehill.com/homenews/administration/4278387-white-house-converting-commercial-buildings-housing/

Let's just hope that no long-awaited projects **cough, Centennial** decide to delay for two to three more years while they chase this program.

3 hours ago, Dougal said:

Lael Brainard has proposed a new federal program to convert empty office buildings to affordable residences.  Seems as if Cleveland and other places have shown that another federal program is not needed.

 

https://thehill.com/homenews/administration/4278387-white-house-converting-commercial-buildings-housing/

This is one of those programs that create sound bites but will likely do almost nothing, and probably what would come from it will be projects that do  not make sense to convert to residential. 

 

Many of the modern offices built in the 1980s and 90s were never designed in such a way to convert. They had large floor plates and plumbing that ran only in the center of the building. It would create a ton of expense and cost to create an environment (without a ton of wasted space) to make a modern apartment out of the space that people would desire to rent at an affordable price. 

Cities like Cleveland and Cincinnati have done well in the office to residential conversions because they have a much older office stock which tended to have smaller floorplates  and not as much plumbing work needing to be run in order to createa livable space.  Look at a 1930s office building and a 1980s building and you can see why a conversion of the older building was economically reasonable. 

Now, look at the office space issue. The big problem in places like San Fran, LA and others are that they have newer office properties that were built on speculative builds that will never be viable due to the new office trends. 

On 10/24/2023 at 8:07 AM, VintageLife said:

Yeah, that is 100% fine, but I’ve seen it torn out and just tossed in the dumpster. 

 

You must watch Property Brothers haha. They should be arrested. 

53 minutes ago, surfohio said:

 

You must watch Property Brothers haha. They should be arrested. 

A lot of those shows do it. I meant more flippers in Columbus when I see the before and after pictures. 

Wish I could read the full article....

 

The Money Has Stopped Flowing in Commercial Real Estate
Decline in construction loans has been particularly severe as lenders continue to cut back
By Peter Grant
Oct. 31, 2023 5:30 am ET

 

Commercial real-estate lending is shrinking to historically low levels, threatening a rise in defaults on expiring debt and a sharp decline in new construction of warehouses, apartments and other property types.

 

Banks, insurance companies and other commercial property lenders have been cutting back since the first half of 2022 when the Federal Reserve began increasing interest rates and recession concerns intensified. But creditors have been even more reluctant to make new loans as Treasury bond yields have soared since early August.

 

https://www.wsj.com/real-estate/commercial/the-money-has-stopped-flowing-in-commercial-real-estate-43c003d3

Thanks Uncle Joe

 

 

18 minutes ago, KJP said:

Thanks Uncle Joe

 

 

Have to admit I never thought they'd do it with so much deficit spending fighting  the Fed.  Let's hope it isn't a one-month phenomenon. 

-The GDP grew at a stunning 5.2% in Q3
-Lowest unemployment rate in 50 years
-Record breaking stock market
-inflation slowing down

 

Yet 75% of Americans say the economy is in a recession, according to a CNN poll.

 

What is up with people?

12 hours ago, KJP said:

-The GDP grew at a stunning 5.2% in Q3
-Lowest unemployment rate in 50 years
-Record breaking stock market
-inflation slowing down

 

Yet 75% of Americans say the economy is in a recession, according to a CNN poll.

 

What is up with people?

The high level metrics for the economy are great. And if you make more than a certain amount per year the cost of things may not be as noticeable.

 

But for the majority of people the cost of things you need to live has gotten so high even when compared to even just a few years ago.

 

Groceries, new cars, used cars, supplies, services, day care. In a lot of households it is a struggle to make ends meet even working hard with a good job. I think that's why so the polls say the economy is doing poorly. Prices seem to be going up, but the pay is not keeping up and they get a sense of hopelessness because they can't really do anything about it.

 

13 hours ago, KJP said:

-The GDP grew at a stunning 5.2% in Q3
-Lowest unemployment rate in 50 years
-Record breaking stock market
-inflation slowing down

 

Yet 75% of Americans say the economy is in a recession, according to a CNN poll.

 

What is up with people?

Well these are lagging indicators. I see a few possibilities.

 

* UMich sentiment survey peaked in July and has fallen since, so it’s possible things actually were relatively great in Q3 but have gotten meaningfully worse.

 

* Consumer loans are at a record high, up over 10% this year, and up nearly 25% since 2019. So it’s possible a lot of the growth is fueled by debt and people are having an “oh crap” moment now.

 

* Maybe the fed overdid it with hikes and everything is breaking. Delinquency rates on consumer loans / auto loans / credit cards (but not mortgages) are at the highest level since the early 2010s. While not historically high, the trajectory is a rocketship up right now. Usually downturns start with loan distress first, then consumer spending falls second, then unemployment rises third. The inflation rate looks great right now, but if it moves down toward 1% or below we’ll start hearing “uh oh, we overdid it” stories.

 

* This is one CNN poll, and no need to put much stock in it.

 

I suspect it may be a combination of all four.

13 hours ago, KJP said:

-The GDP grew at a stunning 5.2% in Q3
-Lowest unemployment rate in 50 years
-Record breaking stock market
-inflation slowing down

 

Yet 75% of Americans say the economy is in a recession, according to a CNN poll.

 

What is up with people?

 

Well almost half of them are living in a disinformation echo chamber to start.    They also think America exists in a bubble and isn't part of the world economy.    Our inflation rate is much lower than most of the industrialized world, but somehow Biden doesn't get credit for this. 

I will be shocked if we ever reach a point again where a plurality of people in surveys say that the economy is better than it was 4 years ago. I don't know if it's all about disinfo, but more about the constant barrage of negativity you get from social media. People are really negative about abstract things (crime, the economy, etc). Despite evidence to the contrary, people will seemingly always have a negative outlook.

28 minutes ago, LlamaLawyer said:

Well these are lagging indicators. I see a few possibilities.

* Consumer loans are at a record high, up over 10% this year, and up nearly 25% since 2019. So it’s possible a lot of the growth is fueled by debt and people are having an “oh crap” moment now.

Consumer loan rates are at nose-bleed levels.  I was recently offered a credit card with a 24.99% apr.  This is not a time to be carrying credit balances. I think that is what the average Joe is noticing.

34 minutes ago, ryanlammi said:

I will be shocked if we ever reach a point again where a plurality of people in surveys say that the economy is better than it was 4 years ago. I don't know if it's all about disinfo, but more about the constant barrage of negativity you get from social media. People are really negative about abstract things (crime, the economy, etc). Despite evidence to the contrary, people will seemingly always have a negative outlook.

 

A lot of people are the thought equivalent of single-issue voters.

2 hours ago, ryanlammi said:

I don't know if it's all about disinfo, but more about the constant barrage of negativity you get from social media. People are really negative about abstract things (crime, the economy, etc). Despite evidence to the contrary, people will seemingly always have a negative outlook.

 

Not just social media. For a recent example, how about this piece of negativity from cleveland.com? https://www.cleveland.com/news/2023/12/2023-data-download-how-numbers-tell-the-story-of-ohios-past-year.html

 

There was lots of positive local news (employment, GDP, personal income, etc.) they could have included; but they didn't.

It's also worth noting that while inflation is slowing down, prices are still going up. It's the difference between acceleration and velocity. If people are used to going 20 mph (and standard annual wage increase structures tend to operate on this assumption) and we have now 'slowed down' to 30mph people are still losing ground every day, and they are way behind from the even higher rates from a few months ago. 

 

Additionally, while wage growth on the aggregate is going up as well, often the only way to realize these gains is to change jobs, which isn't always feasible. 

 

Until inflation is at the target I don't think people will credit the economy as having improved, because most people living paycheck to paycheck don't have the luxury of being concerned with the rate of change of inflation, just the current rate of price increases that are hitting their wallets. 

2 hours ago, ryanlammi said:

I will be shocked if we ever reach a point again where a plurality of people in surveys say that the economy is better than it was 4 years ago. I don't know if it's all about disinfo, but more about the constant barrage of negativity you get from social media. People are really negative about abstract things (crime, the economy, etc). Despite evidence to the contrary, people will seemingly always have a negative outlook.

 

I'm becoming increasingly convinced this is a partially a myth perpetuated by the business world. It's an excuse to keep prices high, and keep raising them. It's also important to set the expectation for employees who might want a raise that things are tough and the company just can't afford it - in fact, you are lucky to even have a job. That one has been going since the Great Recession and reprised for COVID - just ignore all the years of record profits.

 

Hopefully, eventually, we see some real wage growth as actual employees continue to become more scarce. We will also hopefully eventually see companies undercutting the competition on pricing and getting things back to a more reasonable level.

 

part of the issue here is also how polarizing everything is between the two parties.

 

When a Republican is in power, you'll probably see 70%+ of Democrats say we are worse off today ONLY because that person is in power. Then of the remaining 30% you'll probably see 20% of them say we are worse off today because they generally believe it (the negativity on big picture things I alluded to). Then the Republicans will probably be about 40/60. Even if 60% say they are better off, that doesn't account for the 85% of Democrats who say they are worse off. I honestly don't know how we get out of this, but it's general negative opinions about big picture things and people who instinctively say things are worse because their party isn't in power. Of course, the same is true when a Democrat is in power, just switch the names of Dem/Rep. In general, it seems that Democrats are way more willing to be critical of their party than Republicans are, which probably leads to the disapproval ratings of Biden vs. Trump. Both are unfavorable, but Republicans are more likely to toe the party line.

34 minutes ago, Ethan said:

It's also worth noting that while inflation is slowing down, prices are still going up.

 

What you are describing is the difference between disinflation and deflation. We want disinflation (the rate of inflation to decrease, ideally to the Fed's 2% target). We really, really don't want deflation (the rate of inflation to go negative and prices of most goods/services to actually fall). But most Americans have not lived through deflation and don't understand why it would be devastating for our economy; they just want prices to go down, and don't understand that the prices we are seeing on most goods/services now are simply the "new" prices for those things.

3 hours ago, mrCharlie said:

 

I'm becoming increasingly convinced this is a partially a myth perpetuated by the business world. It's an excuse to keep prices high, and keep raising them. It's also important to set the expectation for employees who might want a raise that things are tough and the company just can't afford it - in fact, you are lucky to even have a job. That one has been going since the Great Recession and reprised for COVID - just ignore all the years of record profits.

 

Hopefully, eventually, we see some real wage growth as actual employees continue to become more scarce. We will also hopefully eventually see companies undercutting the competition on pricing and getting things back to a more reasonable level.

 

 

Yeah back in the '90s every industry was saying they'd continue to grow and that they would always be needing new people coming in. The blue collar jobs were telling the truth but the white collar ones were lying (even if they didn't know it). They wanted to make sure that they would always have a pool of suitable workers. This was the first time the blue collar ones had talked like that in quite some time since their reputation for layoffs had gotten so bad starting in the late 1960s.

On 10/24/2023 at 1:04 AM, Lazarus said:

 

 

 

I have mentioned it here on this forum before but it bears repeating - there was almost no such thing as a home renovation for long-time residents or a full house flip until HGTV, etc., popularized the idea.  Yes, people did finish basements, but they didn't spend $30,000 completely rebuilding a perfectly functional kitchen or bathroom.  I also never saw an apartment building that got renovated to the extent that they are commonly renovated today. 

 

 

 

 

I am wrapping up the second bathroom refurb due to wear and tear I have done in a year. Both look the same as they did when they were last redone in the 1990s. HGTV would lose its mind! It doesn't help that they are still coasting on the same flipping content that they made in the late 2000s/early 2010s and its outdated economics of "just rip out the '60s stuff and paint everything gray then count the money".

10 hours ago, taestell said:

 

What you are describing is the difference between disinflation and deflation. We want disinflation (the rate of inflation to decrease, ideally to the Fed's 2% target). We really, really don't want deflation (the rate of inflation to go negative and prices of most goods/services to actually fall). But most Americans have not lived through deflation and don't understand why it would be devastating for our economy; they just want prices to go down, and don't understand that the prices we are seeing on most goods/services now are simply the "new" prices for those things.

 

I admit that I'm in the minority on those among those with any background in academic economics (and I don't claim to have much), but I would be OK with a 0% Fed inflation target and accept overshooting it from time to time and creating 1-2% deflation in individual quarters or even some entire years.  Incidentally, you say that most Americans have not lived through deflation, but we actually have: in 2015, we hit around -0.1%.  Minor technical point given that tiny figure, I know, but it at least requires perspective on whether any deflation at all is per se a bad thing.

 

In particular, any measures that begin to ebb the absolute flood of money supply creation from March 2020 onwards is going to involve at least some deflationary pressure, and that's not an argument that those measures shouldn't happen.  Of course, one of the most anti-inflationary measures relative to the current status quo would be balancing the federal budget--and neither party is remotely interested in that at the moment.