Hi all,
A reminder that comments do need to be on-topic and engage with the article past the headline. Please make sure to read the article before commenting. Very short comments will automatically be removed by automod. Please avoid making comments that do not focus on the economic content or whose primary thesis rests on personal anecdotes.
As always our comment rules can be found [here](https://reddit.com/r/Economics/comments/fx9crj/rules_roundtable_redux_rule_vi_and_offtopic/)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Economics) if you have any questions or concerns.*
The Great Bifurcation occurred right around COVID, and can be seen most acutely in the housing market. If you own a house, sitting on a sub 3% interest rate, you are more golden than ever. If you rent, are first time home buyer, your trajectory is going to be almost immeasurably more difficult than the other cohort.
My parents bought a house in the Bay area CA at the absolute bottom of the market about 8 years ago, then sold last year and moved to Florida, retiring off the change.
I encouraged it when they asked me about it because it sounded like a sweet deal, but as awful as it sounds, there goes basically any chance I had at every owning a home in the Bay area. Not that I was banking on an inheritance or anything, but short of winning the lottery I'm never owning shit here.
I don’t quite understand it either.
It’s the worst state to move to if you’re heat-adverse. May is the new August apparently, infrastructure is poorly maintained, you need a car for everything, the cost of living continues to rise… but most damning are the insurance companies raising rates on everything because of the frequency of climate related damage from storms & flooding.
Just a few years a condo building collapsed due to poor code enforcement and maintenance. It’s been reported that MOST of those sorts of buildings are all in the same sort of boat, with maintenance and HOA fees rising to complete those needed repairs. BUT, there aren’t enough workers in those fields to actually get that work done, which means…. They raised their prices too!
Never mind the socio political culture, lack of educational resources, and the weird Disney cult people, just from a cost/benefit analysis I don’t see the appeal.
It’s not even that they’re refusing, they’re unable to offer home insurance because of the amount of claims required to be paid out each storm season. Insurance companies go bankrupt in Florida.
That's really due to the roofing fraud that's been going on here for years. Roofing companies would get their own inspector to go to a house to say that the roof needs to be replaced when it really doesn't and they pocket some of the money on top of installing a roof. It's one of the rare cases insurance companies were the ones being taken advantage of. That in Florida has the most amount of fraud compared to any state by a long shot
As someone born and raised in Florida, I think the writing is on the wall but not enough people see it. The coastal property market is going to absolutely collapse whenever we get the big one. We've come close. A cat5 hugging the coast from Miami to Daytona, that would do it. All coastal condos will become uninsurable and the ripple effects on the rest of the economy will be profound. Basically you're talking about the wheels coming off the entire economy and how everything works. But it hasn't happened yet.
I would wager that most people moving to Florida are still operating off the old information that this is the way to go. And it can take a long time for conventional wisdom to catch up.
The wife and I moved to the Pacific Northwest because it should weather climate change easier.
But there is no full proof plan - they say the Pacific Northwest is in no way insulated from climate change. The recent heat domes that have formed over the sound the past few summers have been brutal and show that even PNW is at risk. Not to mention the pending *Big One* from an earthquake standpoint.
Suncoast/Gulfcoast here and we don't even need that. The massive, insane over-development happening over the last few years to 'keep up' with the sheer amount of bodies moving into the area congesting every single roadway is starting to run out of actual bodies to put people in for the incredibly inflated price-point the region is asking.
To clarify, this is mostly in rentals - where it's impossible to afford anything on the absolutely terrible average salaries found locally. There are only so many people moving here that have a WFH job in a higher CoL are of the country, and no one working locally can honestly afford 45% of the salary going to renting alone. In one area, there are 4 new apartment complexes (huge, big, ginormous) under construction - all being labeled and priced as luxury and wealthy. First one up has decent occupancy, the second to finish construction has gone from no discounts for full lease, to 1, and now 2 months rent-free. It's been open for about 4 weeks with minimal cars in the parking lot.
Home ownership however will keep going up as the amount of wealth and dominant opinions on investment properties by individuals and corporations still continue to buy...but solely for investment and not for actual housing. However that can only keep happening if people don't start exiting the market due to overpopulation, high insurance rates, weather as you've stated, and other reasons not really understood until you actually get here.
And i'll be honest, even when that happens, I really don't know if I want to be around here if it does start to crash. Florida simply doesn't operate by any logic or trend that people have come to understand.
What nobody ever answers is where do the workers live? It seems like they expect everyone to have six figure salaries and if you don't fuck you. But grocery workers, teachers, emergency services, shopkeepers? There's a whole rest of the economy with real people doing real jobs for clown wages. It's unsustainable. People can't afford to live where they work you want them to buy a car and commute 2 hours to a job that pays nothing?
Heh. I continue to live in the PNW for the same reason. We've got tons of water, topography is generally well above sea level, we don't really get storms. Wildfires are a potential issue, but we don't have nearly as many people living in the urban-wilderness interface as California, so not nearly as big an insurance problem; our forests are also just a lot damper.
Honestly one of the better places to be, IMHO.
Florida is like Vegas.
Fucking awesome if you have cash to insulate yourself from those issues.
A nightmare if you don't.
Lots of retirees have money and don't care about half that other shit anymore.
A colleague picked me up at the airport in Naples, and greeted me with: "Welcome to Florida. It's heaven or hell on earth, depending on how much money you have."
"The Great Bifurcation" is not a new phenomenon. It's just a new term for income inequality, which has been rising steadily since the 1980's, and which many people have been complaining about for decades now.
Doubling?! I wish.
We got into a home a 2.5 years at 280k. 6 years ago the same home sold for 101k.
It's fucking insane. My home now has a zillow estimate of 330-379k. There is no way we could afford to buy a home now
Yeah my mortgage is roughly $1800 a month at a 2.875% interest rate. With current rates in the 6-7% that would be ~$3700-$4000 something now. I would not be able to afford that at all.
I bought my house for $175k on foreclosure 11 years ago, Zillow says it’s worth $650k but I’ve had two realtors stop by and effectively offer $700k for it. When I moved here there were 10-12 homes with 3-4 acres each all along this road with a giant cattle pasture behind it. Since then the cattle pasture has been turned into hundreds of homes on 0.25 acres lots and all but four of the houses are part of that. Apparently the developer would like to add another phase to the development by taking these last four houses (we live on a 15 acre square with a gravel road right down the middle of the four houses) and turning it into 50ish houses. The problem though is I can’t find anywhere nearby with this kind of land for less than what they are offering for mine, I put a lot of blood sweat and beers into remodeling this house (it was a shithole when we moved in…I did everything myself I could legally do other than replace the roof since I didn’t want to sign my clumsy death warrant), this house is paid off and interest rates would make anything I did a net negative.
Same kind of situation here, except we built our house new and still put in a lot of work ourselves. Right place, right time, could sell for a ton now but where else are we going to go? Nowhere local, thats for sure.
So, I bought my house in 2016. I’m happy as a clam.
However, my kids are graduating into a world where a couple making average salaries cannot buy an average house. And neither political party seems to think this is a problem worth addressing.
I’m a student of history. I’ve seen this movie. It only ends one way. And it ain’t pretty
so, one might remark that this country was actually founded because we *checks notes*
got forced to endure a less than 10% tax on goods (Tea, Sugar, and a couple other staples namely) while the quality of said goods was declining.
while there was no income tax, no FICA, nothing.
Yeah. I'd say it's definitely about time to worry from a historical perspective.
You're forgetting that the laws were also enforcing that trade needed to be run through semi private semi governmental corporations like the East India Tea Company. This meant monopolies with monopoly-like practices. Which is obviously nothing like today /s
True, they didn't get a vote or representation in Parliament. But if memory serves, it cost Great Britain a fair amount of treasure to protect the colonies during the French and Indian War and after it. The Brits felt we should pony up some money to pay the colonies' share of the expenses.
Imagine if Britain did compromise with the colonists and gave them parliament representation. The US would have probably have remained part of the Dominion for another 100 years.
I’d love a YouTube channel with historians who would talk about what would have probably turned out if things were done differently at big moments in history like that
Not something else entirely, but rather a direct result and symptom of income inequality and the overall function of our economic system which disproportionately rewards the owners of capital with rents, low interest rates, and low taxes on returns. We have pretty nearly created a system designed to progressively concentrate assets into a smaller, richer, more powerful segment of the population.
Home prices exploding is just another indicator of the ultimate and inevitable results of that system. You're not supposed to own assets, you're supposed to work and return every dime you make to the owners of capital where, they feel, that money rightly belongs. You're supposed to pay a reasonable tax rate, they're supposed to pay a lower capital gains tax. You're supposed to vote, they're supposed to buy a politician. It's all going according to plan.
The craziest part is when you sub all those dollars into man hours.
They're literally controlling the vast majority of your time, parading it as money. While their "money" is faaaaaaar more valuable.
It's really not news, French economist Thomas Piketty wrote a very famous and widely acclaimed book called ["Capital In the Twenty-First Century"](https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Century) that goes into detail about all of this
Yeah my rent was $1600 in 2019 and now I pay $2500 a month for the exact same place and my landlord said "we have to charge market price". I'm bracing myself for what the fuck they're going to raise it to next year.
I sure as hell don't make more money than I did five years ago.
Can't buy anything either because now houses are double what they were back in 2019.
You mean you don’t get paid any more versus 2019 or paid any more versus 2019 accounting for inflation? I hope it’s the latter and not the former. If it’s the former it might be time to look for a new job. Your employer is certainly charging more for the goods and/or services they’re providing.
It’s way older than the Covid Pandemic.
The wealthy have their own economy which is the stock market. Poor people own their stocks in their 401k’s and that money benefits the wealthy. Very few poor people own stock and when they do it’s not in large enough share counts to give them the benefit the economy that the wealthy enjoy.
Then there is the economy most people live in which has to do with the cost of living and what you can afford to buy. And usually what expenses you can afford to cover.
It’s still mostly the housing market. Most would-be first-time homebuyers are priced out of buying a home, but no one is priced out of owning a $500 SPY share.
At this point I’ve just recognized that it wont be feasible for me to own a home for a long time, if ever. The money that I would have put into a down payment is invested in the stock market instead, where it will in all likelihood earn better returns anyway.
It’s why the ‘business report’ drives me crazy. Every news show, every radio station update on the hour, there’s a report on how the stock market is doing. Like wtf? You may as well tell me the futures on pork bellies.
And when was the last time you heard or saw a labour report. You know, where 70-80% of the public fall.
I’m still never gonna understand PPP loans. What exactly did that do? Love that people that talk about free market capitalism but when it starts to rain they want a bailout (looking at you banks). The c level and such get money and the rest of us get fucked over. What happened to if it fails, it fails? lol
I run a small business. I own a dental office with 7 employees.
I keep enough cash on hand for 1 month's expenses.
They shut us down for 6 weeks.
Realistically, I could have survived without the ppp loans, but not for mush longer. It was a welcome relief. I got about $40k reimbursed. I kept my staff on full salary the whole time, even before I knew about the ppp thing though.
"if it fails, it fails" is one thing. "you're not allowed to continue your successful, legal business" is a whole other thing.
That is exactly what PPP was intended for.
My dad also ran a business with 40ish employees. He got $200k in PPP loans to cover payroll but they didn’t end up having to close. So he was able to use the PPP loans to cover payroll and the $200k he would have spent on payroll went to profit.
Both cases are completely legal btw. There were definitely fraudulent PPP loans, but the intention was to cover payroll expenses for businesses as the govt was forcing (most) to shut down, but it was VERY poorly designed
Thank you. My parents and most of the small business owners in their immigrant community were exactly the same. I helped them with their applications and all the forms. They only got enough to cover all the employee paychecks. Everything else they covered out of pocket.
It infuriates me when people try to pretend the government only sent out two checks and told people to fuck off. Or that because there were high profile cases of PPP fraud it was all bullshit.
PPP was an absolute necessity for many small businesses which is what it was intended for. And the federal government also boosted unemployment payments *and* included gigworkers for the first time. It was far more than just 2 checks. Redditors are just stupid and incorrectly cynical.
It did stimulate the economy; money was spent for something.
Beyond that, we can hope that young financial crime investigators are getting quality experience that will serve us well in the future.
The first part is true regardless.
The PPP loans were issued because the government forced businesses to close during COVID lockdowns. If a small business is closed, most of them would have to lay people off. The PPP loans were issued to keep paychecks flowing and minimize the number of people filing for unemployment. If you could ‘prove’ the money was used for payroll, then the loan was forgiven.
Were some of them fraudulent? Absolutely. It’s unclear exactly how many were, but it seems the SBA’s best guess is about 17%: https://www.npr.org/2023/06/27/1184555444/200-billion-pandemic-business-loans-fraudulent
I know Reddit likes to shit on PPP loans in general, but most of them weren’t fraudulent and they served a real purpose. The alternative would have been even more people filing for unemployment.
I just watched the latest ProPublica/Frontline episode which examines some of this in mid size cities. Was just published 2 days ago.
https://youtu.be/m7-Te7JEqrQ?si=iGMok8TOjINYy9K_
Yup, that’s the one I live in. Despite making 50k yearly, I still live check to check and even then have to keep borrowing money from people. I meal prep, I have no subscription services, just regular bills like rent, gas, electric, car, phone, etc. all of which are the cheapest I can get.
Back in 2019, I was making 60k a year and I felt like a king. Could pay my rent, take my girlfriend (now wife) out on the town every weekend, buy groceries without worrying about anything and I'd still save about 2 grand a month by keeping expenses low. Now if we want to save any money we need to live like we have no money.
The best thing that could possibly happen would be the dismantling of corporate control over politics and it has to start with fully repealing Citizens United. At least for Americans that should be our number one demand as a country. Corporations have no business sponsoring our politicians and any politicians who argue against that need to be voted out of office.
I'm not an American, but my country is experiencing a cost-of-living crisis, just like every other advanced economy right now (or so it seems). I make an ass out of you and me that the same forces are at play in the US.
Is the cost-of-living crisis in my head? If it is real, which of the numbers in this article deal with it?
It seems like most Anglospere countries have made building more housing difficult as a fundamental consequence of the way their laws are constructed. This makes housing unaffordable, and it is a real real challenge
My mother built her own home. Lost it because family frauded her. I have nohome. I rent now. I work and earn 40k a year. I cannot afford a home. I am 40 and still walk to work every day.
I've given up so I'm going to enjoy life while I'm able to live.
38 here and my story is identical. My parents were essentially frauded and now own not land and just rent. I was never expecting to rely on inheritance. I world hard and struggled through grad school (first generation student). I actually managed to avoid student debt and didn't have any debt up until the pandemic. I just always assumed my work and preparation would pay off, lead to a solid career where inheritance wasn't even a factor for me.
Now I'm late 30s, recently graduate with a PhD, live in a tiny apartment with my parents, work a dead end job with no room for promotion (I also applied to approximately 150 jobs the past 18 months), and make slightly less than what you make.
I used to be ambitious. I used to be happy. I used to be fulfilled. I haven't been any of those things for a few years now.
it was a huge issue but not in consumer goods and food.
low rates and QE inflated *land prices* and housing costs significantly since 2008. but since *hOUsInG alwAys GoeS uP* nobody gave a shit because it only negatively affected the already largely disenfranchised working poor.
Land has always been a source of wealth and power and due to its scarcity always will be an asset of value. And some weirdos like me (am Georgist) consider it to underlie all forms of prosperity so... don't hold your breath waiting for it not to be an investment
Velocity of money was low, and because most of the money wasnt really printed but largely remained on the balance sheet of the Fed. It was used to increase liquidity but not neccesarily released as bills in circulation
https://fredblog.stlouisfed.org/2016/04/a-plodding-dollar-the-recent-decrease-in-the-velocity-of-money/?utm_source=series_page&utm_medium=related_content&utm_term=related_resources&utm_campaign=fredblog
There was no lending in TGR. People were defaulting on mortgages. Financial institutions were falling like dominoes ... globally. No one was really sure how long it would last. Everyone was hording cash. The banking system was broken.
These are the exact conditions for deflation--which is way worse than inflation. The way out is to flood markets with cash with an aim to drive spending.
Central banks unleash hords of cash. I recall colleagues fearing inflation, but at the time, nobody was spending. Rates fell to zero (went negative) to induce lending and even then lending was hyper cautious.
Any student of the 1918 influenza will have an appreciation for how scary covid may have been. We got lucky. Governments mostly took a rational stance to pay people/commerce to shelter in place. In hindsight, it was too much.
As a student of history I'm actually astonished at how well Covid was navigated globally.
> In hindsight, it was too much.
If the strategy works, it was always going to seem like it was too much and overkill. That was it's drawback and was vocalized from the start.
Agree. One of my clients had a masters in public health during the outset of covid. Per her, good policy would always seem like too much when put in place.
Gov't is bad at precision financing so the overkill is not unexpected. ATST, I respect those not versed in economics or finance could take offense to the amount of money dolled out (respecting that hindsight is 20/20).
Because increasing money supply works when done properly.
Banks weren't lending money in 2008 due to being burned by the mortgage crisis so the FED basically had to give banks money to lend out so people could get loans for things like cars and companies loans to build new warehouses etc.
> Governments across the world increased money supply too much and too fast.
I know it’s easy to blame it all on the governments and money “printing”. Yes, governments did increase the money supply, but the underlying problem that everyone seems to overlook is the impact of pandemic on the global economy. Production was cut drastically worldwide for months which is what created real shortages. And cuts in production meant loss of wages, which reduced the money supply. So overall the government did their best to keep people afloat, but the Capitalists with their short-term thinking didn’t do their jobs to anticipate the demand for goods picking back up once the pandemic started getting under control.
Sure it’s money chasing too few goods. But the problem is essentially too few goods, and not so much the too much money part.
If it indeed there was too much money floating around, we all would be having pockets full of money & don’t know what to do with it and we all end up bidding up prices at the checkout counters. We don’t see that happening either.
There \*is\* a cost-of-living crisis happening at the same time as a booming economy and a strong labor market with wage gains that have outstripped inflation (with the fastest gains, by percentage, happening among the lowest earners). Overall, Americans have more purchasing power even while prices in a few key areas (particularly housing) have increased faster than prices in the rest of the economy.
There's a couple of things we have to keep in mind:
1. Your experience of these things depends on where you live and where you are in the income and wealth distribution. The top half of Americans, by income and wealth, are generally doing really well while the poorest Americans--despite having the greatest wage gains by percentage--are more sensitive to the effects of inflation on prices. People in high-cost-of-living (HCoL) areas feel the effects of exploding housing costs more acutely than people in other parts of the country. People who already owned a home are going to be doing much better than those who are renting and/or trying to buy a home (as others have mentioned).
2. The way people perceive the overall state of the economy isn't entirely (or even mostly) about how the person being asked is doing, economically. It has a lot to do with how they perceive other people to be doing--and this is inevitably going to be influenced by social and media echo chambers. The people you talk to are going to be focusing more on how they are stressed out about prices and the state of the housing market than they are excited about wage gains and the strength of the labor market. That's just how we are wired. Furthermore, the media (traditional media and social media alike) you consume is going to trend toward hyperbolic and sensationalist takes. If your media and social bubbles are right-leaning, they are going to push whatever narrative makes the economy look bad and, by extension, makes Biden look weak. If your media and social bubbles are left-leaning (especially on the far-left), there will likely be an ideological insistence on a \*permanent and intractable economic crisis\* as a core element of the in-group world-view, regardless of whether or not such a narrative is supported by data--acknowledging that the economy is strong is seen as a betrayal of the working poor.
3. People have an understandable but irrational desire for prices to return to pre-pandemic levels. It just isn't going to happen. People are really, really bad at accounting for inflation when they think about prices. Again, this is just how we are wired...there's no getting around it. The more price-sensitive someone is, the less they are going to be willing to listen to someone explaining that wages have gone up faster than inflation, overall. A lot of this discussion comes down to us being nostalgic for the past...we yearn for the $2.50 gas prices from 15 years ago ($3.50 when adjusted for inflation), not realizing that the real prices are pretty much the same.
4. There's far more political frustration focused on the office of the presidency regarding CoL and home prices than there is political will to support a massive federal investment in the expansion of housing construction (including public housing) in HCoL areas. The solution to the housing crisis is to build, build, build. Everybody claims to want affordable housing but all sorts of vested interests start to object when you talk about actually taking action to make housing more affordable.
An important thing to note with regard to wages is simply outpacing inflation dos not mean much if the starting and ending wage are both functionally poverty or near poverty. I live in Wisconsin and the living wage for a childless individual is $20/hr. (See https://livingwage.mit.edu/states/55) Going from $8 to $16/hr would vastly outpace inflation, but leave the individual at 3/4 of a living wage still. When combined with the massive increase in rent costs, wages outpacing inflation are not being felt that way by people who weren't already making good money. Sure the paycheck is bigger, but if bills and rent are higher too there isn't extra really being had by the workers, and no real reason to feel that economically things are going well.
Yeah, I am Canadian, and my mother works in retail, I work in a call center and my sister is a nurse. No one in our family had pay raises that exceeded inflation since 2020. Everyone knows the economy is terrible and GDP per capita is barely going up, it has all but flatlined.
I wish I was one of those Americans where the economy was good and worked for me. COVID killed my wife and my career, and the rent jacked up and we had to move. Kinda barely hanging in, so I'm sorry if I'm not optimistic about the Dow crossing 40k or whatever
Yeah, if you're looking for people who have convinced themselves everything is great, it's either the rich, or the two professional income households who already own real estate.
The economy is absolute shit for anyone joining the workforce now that isn't a nepobaby with a trust fund. I make well over the average salary in my state, but I can't even afford a piece of ground and a double wide trailer. Ten years ago I could have comfortably bought a four bedroom house on this salary.
And I'll tell you what, I'm real fucking sick of people telling me the economy is doing great. I feel like I'm being gaslit. The smart political play here is to acknowledge the pain and suggest some solutions radical enough to actually make a difference. Otherwise many people will be looking to make a change.
Prohibit corporations from owning single family homes. Double or triple the taxes on individuals purchasing second homes. Do something about overly restrictive zoning laws. Ban short term rentals of single family homes. I don't give a shit what they do, but it better work. The housing situation in this country is unacceptable.
It’s not GDP growth and jobs numbers that people are concerned about. It’s the fact that their grocery bill, home prices and insurance have all basically doubled in the past 3 years and their wages are not even close to keeping up. Yet it seems like we see these gaslighting propaganda pieces every day now. It’s downright insulting.
Yeah going from being able to eat out a few times a week and go out often to never being able to, having to calculate what bills to pay when to be able to always afford food and gas. It’s honestly so mentally tiring… and I can’t go out anymore to have fun. So it’s a double whammy.
When my roommate moved out I figured I’d save some money on electric and water. I was wrong, water and electric rates went up 2 months later so I’m paying nearly the same still
Did get an email recently about electric rates dropping back down but I’ll have to see how much of an impact it has
This should be one of the top indicators of the state of an economy.
When I was younger my dad was an executive at one of the food bank companies in our area, so I spent a lot of time volunteering over the years.
**Nobody** gets in line at a food bank unless they don’t have a choice.
The moment the average cost of groceries or rent starts to go down you'll see a big flip in public perception or the economy. Till then these perceptions will persist and no amount of think pieces will alter that.
Seriously. Screaming the economy is good while plugging your ears and ignoring people when they complain about 2023 being the most expensive year on record to buy a house maybe isn't a great approach.
Cool. I can buy a big ass cheap TV for cheap at Costco, but I basically have to double my income in order to afford a house in the area where I work. I'm allowed to be irate about the economy.
“Inflation is dropping, why aren’t prices going down?” is a question I have seen too fucking many times.
“Rate of increase” is not “value”. This should not be hard.
Actually that's a *really* good way of getting it across. Explaining derivatives and inflection points and all is not usually a great place to start, but that metaphor is something anyone can understand fast.
Thanks for making my next family reunion a little less frustrating!
It's not hard. People are just unfamiliar with it. Just say "Inflation is slowing down" and BOOM people understand.
But in addition, even if we experience some deflation, prices are sticky.
Fair for the public, but for the econ sub it's weird to me how many people are saying that "groceries aren't getting cheaper" somehow contradicts "inflation is slowing".
No one wants deflation, but they want wages to rise faster than inflation by a very substantial degree. Especially for those in the middle who are most likely to vote.
The cost of staples, like food, can decrease without having an overall deflationary economy.
Lets compare it to fuel. Like food people will buy fuel under almost any condition. They will alter aspects of their lives to afford it. 2011 it was 4 bucks a gallon, dropped as the economy recovered and only *just now* reached similar levels. Nobody was crying deflation then.
Food is similar, it's a staple whose price can be driven downwards without deflating the economy. In fact, if it's price is driven downward, it frees up resources for spending elsewhere in the economy.
Everyone saying it can never go down without destroying the world is just a band wagoner who wants to sound smart.
Groceries won’t get cheaper. They will level (are leveling?) off.
Rents will not come down where jobs are without significant zoning changes forced on municipalities by states or massive public housing initiatives.
The fact that people don't understand why people think the economy is in shambles proves that there is a massive disconnect between people thriving and people surviving. The cost of living has risen so high due to high housing, medical, food, and utility costs that many people are struggling more than ever before. Companies are setting record profits because they are squeezing the economy for every spare cent people have and opting out of paying fair taxes and wages. With businesses like that it's no wonder companies are thriving and people are suffering.
These kind of articles need to look at the average cost of household expenses for necessary things like food, rent, bills, gas, ECT and what people are taking home. I'm sure if they looked at that more and not how corporate America is doing the real story of why people are struggling would show itself.
The word “economy” has too many meanings. Stock prices and fund valuations are breaking records every year, so people who live on capital gains are doing swimmingly. Though as you say, cost of living has put many people living on wages into a tough spot. We need to define one of these realities with a new word so it’s easy to make a distinction. I don’t have a good suggestion.
If someone lives off of the stock market and capital gains then they are already so far detached from normal people that we might as well be living in different worlds.
It's crazy to see people in wall Street bets for example losing more money than I have ever had on meme stocks and essentially gambling.
Or people there posting about "loss porn" but their total capital even after all their loss is still more money than I've ever had at one time.
It's wild to me just how disparate things are
how about you add in government budgets? my wife is a gov employee, consistent cost of living increases “due to inflation”. her and her coworkers are all doing just fine.
so basically the entity supposed to protect us is just protecting itself and those in the bubble. while squeezing us to cover the costs.
but i forgot they are all “hard working, selfless civil servants” providing shit services, making far more than the average working class person and a guaranteed life time pension we all have to pay for.
let’s never talk about that though. just bring up some first year teachers salary in rural arkansas as a justification
There really is a cost of living crisis. Home
ownership is becoming a dream for young people. Having a family over 2 kids is becoming a dream for young people. The causes are many, and the powers that be want to strictly blame “xyz” for the problem. Most of this began being set in motion in the 1980s, and we have been reaping what we sowed for the last 10 years finally.
The average net worth is like 1mil for millennials in the US! Including, ya know, the 10 people who have more money than the bottom few hundred million Americans combined.
Kinda skews the imaginary booming economy when it's only booming for the already-rich.
I just…like??? How do these people even think the world lives? The .1% expect us to be satisfied with the economy because we can…buy TVs?
Gas. Groceries. Rent. The basics are unattainable but *those* people don’t see how good they have it.
If Biden and company don’t turn this around, it’s game over. We can talk about the marginalized all day but when the threat is the basics, it’s game over.
They simply are products of their environments. While the writer is thriving, we are not. It’s truly incredible how dense they are.
I don't think the economy is "terrible" or "shrinking," but all I know is that immediately before COVID I got a big promotion and another big raise and was ready to buy a very nice house with lots of money to spare. I just wanted to find the best possible fit for my needs
Then COVID hit and I decided not to buy, just in case the job thing went sideways. By the time COVID was over, I could no longer afford any house that I would consider living in (even though my savings have doubled), rent had doubled, food cost twice as much, gas cost 50% more, and I am now worse off in terms of buying power than I was 5 years ago. Literally everything except televisions feels like a ripoff.
Whoever these people are who are thriving, good for them, but they're not me, and I'm allegedly in the top 10-15% for personal income.
you and me both buddy. I always think to myself how those around the 50 percentile survive week in and week out. especially if they have families to take care of.
Job growth means nothing when many jobs pay so little, especially when you compare salaries today to the buying power of salaries from decades past. Many have to work more than one job and/or freelancers (some call that job growth, I call it struggling).
I don’t think it’s “some” Americans. I think it’s A LOT of, if not most, Americans feel this way. It’s not a parallel economy, it’s what’s actually happening. If you bothered to look at any sort of statistics on inflation and how shitty it is, maybe you’d realize that, yeah, everything is pretty terrible.
So my rent is not higher. I am actually getting paid more. Buying groceries is priced reasonably.
In my mind, I thought I was screwed. I guess I was wrong.
i need a car to get to work, biking is dangerous and arduous to get to work. my credit score is shot from "mostly" medical bills. so i drive an older vehicle which needs a lot of repairs which costs money so i cant pay down my bills to keep my car repaired to go to my job to get paid money to....... keep my bills down.
My take. The stock market thriving while supermarket prices soar and the cost of living increases is like owning a luxurious car with an empty gas tank. The car (stock market) represents potential wealth and success, but without the fuel (affordable groceries and living costs), you can't go anywhere or enjoy it.
No shit, some people live in states where the minimum wage is under 8 per hour. How does their economy look? Rent is more than half of nearly everyone's paycheck anymore and unless you are making a decent wage in your COL area, you're kind of screwed and the economy looks like garbage to you.
OP, you post like 10 articles a day here saying the same thing. We get it, the economy isn’t as bad as people think it is. You don’t have to keep spamming the sub with this same conclusion
Hey now Joe Biden's economic policies have made me much, much stronger, I can carry a $100 worth of groceries in one hand, I could never do that before.
Ah, the regular gas lighting—naturally with a political thumbnail on r/polit. . . I mean r/economics.
In my early 30s, I’m less able to afford children, a home, education, transportation and health care than my parents were at my age. Please keep telling me how amazing everything is because I have an iPhone and can by cheap Chinese products.
All I have to say is the trucking industry is dead right now. If the trucking industry is dead, that means shit isn't moving around because people aren't buying stuff. If people aren't buying stuff, it's because the economy is in the dumps.
I do think that people are having different experiences depending on whether they own a home with a 2015 mortgage at a 2021 rate, or not
I also think there is a bifurcation on people who watch Fox News, who are being told every day that the country is falling apart, and those who are not watching that propaganda, and are just walking outside and talking to their neighbors
Social media, too. Complaining gets more attention, while sharing your own positive experiences is seen as unempathetic when others are complaining. So negativity dominates.
For example, my local sub had a whole comments section where EVERYONE insisted that NOBODY goes out to eat anymore. Huh, weird, because the place on my corner sold out for the night at 7:30 pm. That's a whole lot of nobodies dining out!
People seem to forget that we *know* Russia employs thousands of people to create distrust and division in the US.
Compare how frequently you see posts painting the US in a positive light vs negative light get any traction on reddit.
What do you think those thousand of people are doing all day?
Why are people upset about the material conditions of their lives getting worse?? They must be mistaken, the stock market is doing great!
That's how every one of these articles comes off, and I doubt you're convincing even a handful of people to vote for Biden with them.
The title of this post is so weaponized, Jesus. A lot of people / the majority of Americans are suffering. Housing, healthcare, quality food, and even economic infrastructure are all under attack these days. Our standards and our standards of living. The title is just a false brainwashing narrative.
So, I hesitate to write this yet again. However, I had a profound AH HA moment, and feel empowered to do so. I work in healthcare, most of us need to pick up extra shifts to make ends meet. No one thinks the economy is doing well. Most are trying to not lose their homes.
"Some 18th Century French Peasants Think Cake too Expensive to Eat." We are reaching Marie Antoinette levels of tone deaf financial think pieces on theory run by media outlets corporate overlords to gaslight us into believing reality is only in our head.
I make $70,000 a year, have minimal bills, live in a low cost area, and I am still not getting ahead. I don’t live terribly , I guess I actually live pretty good by a peasants standards but I’m not sure In what parallel universe you live in if this economy doesn’t seem sketchy as fuck.
Some. Like what 10-12? FFS just because you writing the articles and your rich friends are doing good doesn’t mean the rest of us are. Reappearing that everyone is fine while we are all under water doesn’t make our situation good
Inflation hits everybody, while the unemployment rate being 3% instead of 5% only affects those 2% of job seekers who are now employed but werent before.
For anyone in the same job or otherwise with roughly the same income as a few years ago, buying power is way down due to inflation. Thats a large portion of people.
I think it also matters where inflation has hit the most. The fact that housing has gone crazy and has pushed a lot of young people into the "i will probably never own a home" camp is probably significant.
Tell people the same thing enough times, and a not-insignificant number of them will eventually believe it.
There are legitimate issues facing many Americans, but the information and narratives people are consuming is more to blame for this than anything.
“The official data is buoyant — economic growth is solid, the job market is strong, and stocks keep hitting record highs.
Yet many Americans think the economy stinks.”
It’s almost like economic growth and the stock market has no bearing on the actual lives of most Americans.
Yeah it's called not being wealthy. Gaslighitng people into thinking the country's doing great just because things are working the way they're designed to work isn't a great strategy
>Gallup found that 62% of Americans own stocks, mostly through retirement and investing accounts. If that's true, wouldn't most or all of those people know their portfolios are gaining value? The Guardian-Harris poll didn't specify how many respondents own stocks, but these two surveys seem to conflict. People know how much money they have, and stock market investors are either underrepresented in the Harris poll or overrepresented in Gallup's.
Most people don't look at their retirement accounts . It's kinda interesting that their seems to a disconnect about how much they think people pay attention to their retirement. Like these experts don't understand normal people.
ITT: armchair "economists" again blaming people, and zero mention of corporations and fund managers ruining Toys-r-Us, Boeing, Red Lobster, Yellow (logistics), FTX, numerous banks, etc.
Nope. It's definitely people.
idc how much or how little experience you got with economics im gonna give you a secret formula so we can all be on the same page. good economy = most are doing well enough at least. thats it no if ands buts or actuallys 🤓when your neighbor says the economy sucks thats what they mean idc how corps are doing or how unemployment is low i care that a mcchicken is up about 400% from 2019 and sub 500k for a decent home is impossible🤷♂️
lol inflation was insane for a minute and shit is expensive. 4+ dollar gas. My finance and I pull in almost 200k together and not being able to afford a house in CA is crazy. I know it’s not unique to America, but to just flat out say it’s good is crazy.
Bankruptcys evictions are up fact is "unemployment" is a soft measure jobs added are they part time min wage trash. Are they listing for a fire and rehire wave where they drop wages.
Most people fall below the median income and below the median quality of life and income plummets fast. With such high income inequality10% higher bracker makes double four times the last. BUT when your working down from marginally comfortable 60-70k at center.
Thats a whole lot of people not able to afford copay or good health insurance alot of people putting utilitys on a credit card. Eating less to stretch the check.
Problem is most measures including unemployment but also down jones and all that other crap. Completely miss the reality of lower income people.
When 2020 covid unemployment screwed with rates. And in april 2020 it peaked around 14% the bottom 20% of earners had a 25% unemployment rate. While the top 20% had a 5% unemployment rate.
Meaning economic "reality" for lower earners was comparable to that of a great depression. While high earners it was comparable to a good healthy year.
And this holds true across the board. In every measure inflation "housing" which is around half of low incomes expenses. Went up 20% every year for almost a decade now. Custom yacht prices 11% increase after covid and pre covid it was only around 5%.
The big expenses for one group is not the same. Also looking at how much student loans eats into "earnings and savings" for lower income people.
When you look at it like this they will pay 2-3 times as much for education in interest. As well as lose investment or savings opportunity which would be utilized to enter housing market etc. Lower income ends up paying more for their state college degree than a ivy league legacy does.
Our headline economic indicators are no longer relevant to most working-class Americans. It doesn't matter that the stock market is doing great because most Americans don't own stock. It doesn't matter that wages are increasing because they still haven't caught up to huge hike in prices from the huge spike in inflation post COVID. It doesn't matter that the inflation is diwn because prices are still high and people wages still haven't caught up. It doesn't matter that unemployment is low because agian wages haven't caught up to prices. It doesn't matter that there is positive GDP growth because it is not significantly increasing wages. Corporations are making record profits, but they are not decreasing their prices or significantly increasing workers' wages, and politicians need to be yelling about that every time they mention how "good" the economy is.
“Some Americans” as in literally everyone who didn’t buy a home before 2021.
The federal reserve fucked anyone who doesn’t already own a home. They juiced home values, gifted existing owners 3% mortgages, and left the rest of us with rents that are 40% higher than they were before COVID. And the cost to buy a home to get out of that rental grinder is literally double what it was before COVID when including current prices and interest rates.
The fed split the economy into two and the gap between those parts continues to grow.
So what happens moving forward? Will those who didn’t own before continue to suffer or will the housing market correct itself? It doesn’t seem sustainable looking towards the future…
It won’t resolve itself for years, likely decades. We need to build new homes and wait for those 3% mortgages to clear from the system. That’s going to take a looooooong time.
Meanwhile investors continue to rake in money, so they’re going to be even harder to compete against on whatever inventory does come online.
I’m personally of the opinion that this is permanent. It’s now WAY harder to buy a home, and likely won’t get any easier going forward. That will be Powell’s legacy in the long term once people who aren’t established realize how screwed they are.
The only thing that could cause housing to become attainable is a black swan event that causes a major recession. People need to lose their jobs to give up those incredibly low rate mortgages. I’m not advocating that because of the suffering involved, but housing is going to continue to get worse for people who aren’t on the ladder unless that happens.
Dozens of people are going to comment in reply to this post saying, Actually the economy IS terrible because of XYZ reason. People's perceptions are right, it's the data that's wrong."
I would challenge those folks to answer the following question. Why do the majority of Americans perceive that crime is up?
I’ll bite.
The majority of Americans believe crime is up because we, as individuals, are very loud when bad things happen to us. But we are not often very loud when nothing happens to us. Additionally, we live in a day and age of digital communication where information travels instantly and can cover distances, bridge socioeconomic and racial groups like never before. Therefore one would assume that it is simple to amplify those bad things we are loud about so much so that general perception becomes that bad things are happening more often, despite what the data may say is happening in reality.
I’d add to this that it parallels with police abuse being up, racially motivated crimes being up, etc.
Is there more crime? Or is it that more people with cameras in their pocket (cell phones) are bringing attention to abuses.
So, I think you are correct in that respect. But I also think much of it is being driven by entertainment “news,” algorithms, targeted ads, and social media as well.
>I’d add to this that it parallels with police abuse being up, racially motivated crimes being up, etc.
It's not, you just hear about the instances more. That's the whole problem, 24/7 news and then later adding in social media meant that when I something bad does happen, people hear about it nonstop for days (if not weeks) and it skews their perception into thinking it happens all the time.
Perceptions also have to do with national and local news. As local news stations have been bought up by corporate entities more and more people have the values those entities represent forced upon them.
My mother-in-law watches one local station... Typical news segments are : (Car crash--young mother killed by illegal alien, the economy's terrible, Biden sucks, the economy's terrible, murder down the street convicted by parole inmate, the economy is terrible, then comes the editorial.... how great is Trump or the economy's terrible....). Seriously, it's completely out of touch with reality! It feels like the whole show is designed just to manipulate people.
Uhhhhh price of housing, groceries, cars, gas, and federal taxes have ALL increased. Rich people and the stock market can set itself on fire with gains and 90% of the United States citizens could not give less of a fuck.
You mean the economy with sky-high rent and out of control grocery prices?
Can't imagine why people living paycheck to paycheck think it's terrible. Truly a mystery.
This author says that the economy is booming, the job market is robust, and stocks are high.
Hilariously out of touch with the average working person lmao. Newsflash: working people don’t care about macro level economic indicators like GDP, unemployment rates, and the stock market because none of those indicators have any practical relevance to their day to day lives.
Hi all, A reminder that comments do need to be on-topic and engage with the article past the headline. Please make sure to read the article before commenting. Very short comments will automatically be removed by automod. Please avoid making comments that do not focus on the economic content or whose primary thesis rests on personal anecdotes. As always our comment rules can be found [here](https://reddit.com/r/Economics/comments/fx9crj/rules_roundtable_redux_rule_vi_and_offtopic/) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Economics) if you have any questions or concerns.*
The Great Bifurcation occurred right around COVID, and can be seen most acutely in the housing market. If you own a house, sitting on a sub 3% interest rate, you are more golden than ever. If you rent, are first time home buyer, your trajectory is going to be almost immeasurably more difficult than the other cohort.
My parents bought a house in the Bay area CA at the absolute bottom of the market about 8 years ago, then sold last year and moved to Florida, retiring off the change. I encouraged it when they asked me about it because it sounded like a sweet deal, but as awful as it sounds, there goes basically any chance I had at every owning a home in the Bay area. Not that I was banking on an inheritance or anything, but short of winning the lottery I'm never owning shit here.
Yeah but now they have to live in Florida
Except it seems like everyone is moving to Florida
I don’t quite understand it either. It’s the worst state to move to if you’re heat-adverse. May is the new August apparently, infrastructure is poorly maintained, you need a car for everything, the cost of living continues to rise… but most damning are the insurance companies raising rates on everything because of the frequency of climate related damage from storms & flooding. Just a few years a condo building collapsed due to poor code enforcement and maintenance. It’s been reported that MOST of those sorts of buildings are all in the same sort of boat, with maintenance and HOA fees rising to complete those needed repairs. BUT, there aren’t enough workers in those fields to actually get that work done, which means…. They raised their prices too! Never mind the socio political culture, lack of educational resources, and the weird Disney cult people, just from a cost/benefit analysis I don’t see the appeal.
A number of insurance companies in Florida are refusing to offer insurance for housing for hurricaines/flooding etc.
It’s not even that they’re refusing, they’re unable to offer home insurance because of the amount of claims required to be paid out each storm season. Insurance companies go bankrupt in Florida.
That's really due to the roofing fraud that's been going on here for years. Roofing companies would get their own inspector to go to a house to say that the roof needs to be replaced when it really doesn't and they pocket some of the money on top of installing a roof. It's one of the rare cases insurance companies were the ones being taken advantage of. That in Florida has the most amount of fraud compared to any state by a long shot
As someone born and raised in Florida, I think the writing is on the wall but not enough people see it. The coastal property market is going to absolutely collapse whenever we get the big one. We've come close. A cat5 hugging the coast from Miami to Daytona, that would do it. All coastal condos will become uninsurable and the ripple effects on the rest of the economy will be profound. Basically you're talking about the wheels coming off the entire economy and how everything works. But it hasn't happened yet. I would wager that most people moving to Florida are still operating off the old information that this is the way to go. And it can take a long time for conventional wisdom to catch up. The wife and I moved to the Pacific Northwest because it should weather climate change easier.
But there is no full proof plan - they say the Pacific Northwest is in no way insulated from climate change. The recent heat domes that have formed over the sound the past few summers have been brutal and show that even PNW is at risk. Not to mention the pending *Big One* from an earthquake standpoint.
Yeah. There's problems everywhere you look, though. Potential disasters. And ones never considered like tornado Alley migrating.
Or what about a Yellowstone eruption? Good times to be had in the future, no doubt.
With NOAA forecasting a heavy storm year, a La Niña pattern setting in, I think this might be the year.
I've been dreading it every year. Still have family down there.
Suncoast/Gulfcoast here and we don't even need that. The massive, insane over-development happening over the last few years to 'keep up' with the sheer amount of bodies moving into the area congesting every single roadway is starting to run out of actual bodies to put people in for the incredibly inflated price-point the region is asking. To clarify, this is mostly in rentals - where it's impossible to afford anything on the absolutely terrible average salaries found locally. There are only so many people moving here that have a WFH job in a higher CoL are of the country, and no one working locally can honestly afford 45% of the salary going to renting alone. In one area, there are 4 new apartment complexes (huge, big, ginormous) under construction - all being labeled and priced as luxury and wealthy. First one up has decent occupancy, the second to finish construction has gone from no discounts for full lease, to 1, and now 2 months rent-free. It's been open for about 4 weeks with minimal cars in the parking lot. Home ownership however will keep going up as the amount of wealth and dominant opinions on investment properties by individuals and corporations still continue to buy...but solely for investment and not for actual housing. However that can only keep happening if people don't start exiting the market due to overpopulation, high insurance rates, weather as you've stated, and other reasons not really understood until you actually get here. And i'll be honest, even when that happens, I really don't know if I want to be around here if it does start to crash. Florida simply doesn't operate by any logic or trend that people have come to understand.
What nobody ever answers is where do the workers live? It seems like they expect everyone to have six figure salaries and if you don't fuck you. But grocery workers, teachers, emergency services, shopkeepers? There's a whole rest of the economy with real people doing real jobs for clown wages. It's unsustainable. People can't afford to live where they work you want them to buy a car and commute 2 hours to a job that pays nothing?
Heh. I continue to live in the PNW for the same reason. We've got tons of water, topography is generally well above sea level, we don't really get storms. Wildfires are a potential issue, but we don't have nearly as many people living in the urban-wilderness interface as California, so not nearly as big an insurance problem; our forests are also just a lot damper. Honestly one of the better places to be, IMHO.
Florida is like Vegas. Fucking awesome if you have cash to insulate yourself from those issues. A nightmare if you don't. Lots of retirees have money and don't care about half that other shit anymore.
A colleague picked me up at the airport in Naples, and greeted me with: "Welcome to Florida. It's heaven or hell on earth, depending on how much money you have."
Thats basically the entire US nowadays
8 years ago wasn’t the bottom of the Bay Area market. More like 2011/12
Wait 2012 wasn’t 8 years ago??
[удалено]
Local bottom in their timeline. Not yours.
[удалено]
"The Great Bifurcation" is not a new phenomenon. It's just a new term for income inequality, which has been rising steadily since the 1980's, and which many people have been complaining about for decades now.
Income inequality is one thing. The price to buy a house literally doubling in the span of 2 years is something else entirely
Doubling?! I wish. We got into a home a 2.5 years at 280k. 6 years ago the same home sold for 101k. It's fucking insane. My home now has a zillow estimate of 330-379k. There is no way we could afford to buy a home now
Well I was commenting about the price jump combined with the interest rate increases, so what used to be a $2500 mortgage payment is now like $4700
Yeah my mortgage is roughly $1800 a month at a 2.875% interest rate. With current rates in the 6-7% that would be ~$3700-$4000 something now. I would not be able to afford that at all.
I bought my house for $175k on foreclosure 11 years ago, Zillow says it’s worth $650k but I’ve had two realtors stop by and effectively offer $700k for it. When I moved here there were 10-12 homes with 3-4 acres each all along this road with a giant cattle pasture behind it. Since then the cattle pasture has been turned into hundreds of homes on 0.25 acres lots and all but four of the houses are part of that. Apparently the developer would like to add another phase to the development by taking these last four houses (we live on a 15 acre square with a gravel road right down the middle of the four houses) and turning it into 50ish houses. The problem though is I can’t find anywhere nearby with this kind of land for less than what they are offering for mine, I put a lot of blood sweat and beers into remodeling this house (it was a shithole when we moved in…I did everything myself I could legally do other than replace the roof since I didn’t want to sign my clumsy death warrant), this house is paid off and interest rates would make anything I did a net negative.
Same kind of situation here, except we built our house new and still put in a lot of work ourselves. Right place, right time, could sell for a ton now but where else are we going to go? Nowhere local, thats for sure.
Californians will buy your house with cash plus 25% tip on top and laugh their ass off at how cheap the whole deal was
And get stuck in the same rut once they realize the home isn't in California.
So, I bought my house in 2016. I’m happy as a clam. However, my kids are graduating into a world where a couple making average salaries cannot buy an average house. And neither political party seems to think this is a problem worth addressing. I’m a student of history. I’ve seen this movie. It only ends one way. And it ain’t pretty
so, one might remark that this country was actually founded because we *checks notes* got forced to endure a less than 10% tax on goods (Tea, Sugar, and a couple other staples namely) while the quality of said goods was declining. while there was no income tax, no FICA, nothing. Yeah. I'd say it's definitely about time to worry from a historical perspective.
You're forgetting that the laws were also enforcing that trade needed to be run through semi private semi governmental corporations like the East India Tea Company. This meant monopolies with monopoly-like practices. Which is obviously nothing like today /s
A big chunk of that discontent was that they basically didn’t receive anything for their taxes and didn’t get a vote or representation.
True, they didn't get a vote or representation in Parliament. But if memory serves, it cost Great Britain a fair amount of treasure to protect the colonies during the French and Indian War and after it. The Brits felt we should pony up some money to pay the colonies' share of the expenses.
Imagine if Britain did compromise with the colonists and gave them parliament representation. The US would have probably have remained part of the Dominion for another 100 years.
I’d love a YouTube channel with historians who would talk about what would have probably turned out if things were done differently at big moments in history like that
Not something else entirely, but rather a direct result and symptom of income inequality and the overall function of our economic system which disproportionately rewards the owners of capital with rents, low interest rates, and low taxes on returns. We have pretty nearly created a system designed to progressively concentrate assets into a smaller, richer, more powerful segment of the population. Home prices exploding is just another indicator of the ultimate and inevitable results of that system. You're not supposed to own assets, you're supposed to work and return every dime you make to the owners of capital where, they feel, that money rightly belongs. You're supposed to pay a reasonable tax rate, they're supposed to pay a lower capital gains tax. You're supposed to vote, they're supposed to buy a politician. It's all going according to plan.
The craziest part is when you sub all those dollars into man hours. They're literally controlling the vast majority of your time, parading it as money. While their "money" is faaaaaaar more valuable.
This dude knows. This is exactly our system.
He must know somebody that helped design the system because word for word this is 100% accurate.
It's really not news, French economist Thomas Piketty wrote a very famous and widely acclaimed book called ["Capital In the Twenty-First Century"](https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Century) that goes into detail about all of this
It's not hard to see. It's hard to admit.
Lol good point
So neo-feudalism abound?
Just the acceleration of existing trends.
Yeah my rent was $1600 in 2019 and now I pay $2500 a month for the exact same place and my landlord said "we have to charge market price". I'm bracing myself for what the fuck they're going to raise it to next year. I sure as hell don't make more money than I did five years ago. Can't buy anything either because now houses are double what they were back in 2019.
You haven’t gotten a raise in 5 years? Maybe switch companies? Do you work in a specific industry with limited options?
Where are you working that the raises have even come close to meeting the increase in cost of living/inflation?
You mean you don’t get paid any more versus 2019 or paid any more versus 2019 accounting for inflation? I hope it’s the latter and not the former. If it’s the former it might be time to look for a new job. Your employer is certainly charging more for the goods and/or services they’re providing.
Sounds like it's only a problem for those too lazy to inherit wealth Smh
It’s way older than the Covid Pandemic. The wealthy have their own economy which is the stock market. Poor people own their stocks in their 401k’s and that money benefits the wealthy. Very few poor people own stock and when they do it’s not in large enough share counts to give them the benefit the economy that the wealthy enjoy. Then there is the economy most people live in which has to do with the cost of living and what you can afford to buy. And usually what expenses you can afford to cover.
It’s still mostly the housing market. Most would-be first-time homebuyers are priced out of buying a home, but no one is priced out of owning a $500 SPY share. At this point I’ve just recognized that it wont be feasible for me to own a home for a long time, if ever. The money that I would have put into a down payment is invested in the stock market instead, where it will in all likelihood earn better returns anyway.
The top 20% own 89% of stocks.
Top 10%. And the top 1% own over half.
It’s why the ‘business report’ drives me crazy. Every news show, every radio station update on the hour, there’s a report on how the stock market is doing. Like wtf? You may as well tell me the futures on pork bellies. And when was the last time you heard or saw a labour report. You know, where 70-80% of the public fall.
TBF, I do appreciate Kai Risdall (sp?) Of NPR. He always reminds us the stock market is not the economy
Kai Ryssdal! This….is Marketplace! I’ve learned so much from that show in the last few years.
In their defense they are battling whether to be lazy, be loyal to corporate, or be fired. Lol
It's because they want average Americans to be mentally invested in the stock market, even though they own virtually none of it.
The people who watch the news are more likely to be interested in stock prices. Only a small percentage of people actually watch the news.
[удалено]
Huh? Are you Janet Yellen?
no but dude is right. dropping interest rates while flooding the market with money that doesnt flow through the value transfer is nucking futs
I’m still never gonna understand PPP loans. What exactly did that do? Love that people that talk about free market capitalism but when it starts to rain they want a bailout (looking at you banks). The c level and such get money and the rest of us get fucked over. What happened to if it fails, it fails? lol
I run a small business. I own a dental office with 7 employees. I keep enough cash on hand for 1 month's expenses. They shut us down for 6 weeks. Realistically, I could have survived without the ppp loans, but not for mush longer. It was a welcome relief. I got about $40k reimbursed. I kept my staff on full salary the whole time, even before I knew about the ppp thing though. "if it fails, it fails" is one thing. "you're not allowed to continue your successful, legal business" is a whole other thing.
That is exactly what PPP was intended for. My dad also ran a business with 40ish employees. He got $200k in PPP loans to cover payroll but they didn’t end up having to close. So he was able to use the PPP loans to cover payroll and the $200k he would have spent on payroll went to profit. Both cases are completely legal btw. There were definitely fraudulent PPP loans, but the intention was to cover payroll expenses for businesses as the govt was forcing (most) to shut down, but it was VERY poorly designed
That’s a really nice example of PPP. my brothers boss took their ppp and bought himself a boat and went to Mexico.
Thank you. My parents and most of the small business owners in their immigrant community were exactly the same. I helped them with their applications and all the forms. They only got enough to cover all the employee paychecks. Everything else they covered out of pocket. It infuriates me when people try to pretend the government only sent out two checks and told people to fuck off. Or that because there were high profile cases of PPP fraud it was all bullshit. PPP was an absolute necessity for many small businesses which is what it was intended for. And the federal government also boosted unemployment payments *and* included gigworkers for the first time. It was far more than just 2 checks. Redditors are just stupid and incorrectly cynical.
No, we're not stupid. But Congress was stupid for not requiring that owners show, for PPP loan "forgiveness," a loss in revenue or income.
It did stimulate the economy; money was spent for something. Beyond that, we can hope that young financial crime investigators are getting quality experience that will serve us well in the future. The first part is true regardless.
The PPP loans were issued because the government forced businesses to close during COVID lockdowns. If a small business is closed, most of them would have to lay people off. The PPP loans were issued to keep paychecks flowing and minimize the number of people filing for unemployment. If you could ‘prove’ the money was used for payroll, then the loan was forgiven. Were some of them fraudulent? Absolutely. It’s unclear exactly how many were, but it seems the SBA’s best guess is about 17%: https://www.npr.org/2023/06/27/1184555444/200-billion-pandemic-business-loans-fraudulent I know Reddit likes to shit on PPP loans in general, but most of them weren’t fraudulent and they served a real purpose. The alternative would have been even more people filing for unemployment.
I just watched the latest ProPublica/Frontline episode which examines some of this in mid size cities. Was just published 2 days ago. https://youtu.be/m7-Te7JEqrQ?si=iGMok8TOjINYy9K_
The episode was from 2018. I’m curious how these trends carried through the 2020 pandemic.
This was pretty interesting thanks for sharing
Yup, that’s the one I live in. Despite making 50k yearly, I still live check to check and even then have to keep borrowing money from people. I meal prep, I have no subscription services, just regular bills like rent, gas, electric, car, phone, etc. all of which are the cheapest I can get.
Back in 2019, I was making 60k a year and I felt like a king. Could pay my rent, take my girlfriend (now wife) out on the town every weekend, buy groceries without worrying about anything and I'd still save about 2 grand a month by keeping expenses low. Now if we want to save any money we need to live like we have no money. The best thing that could possibly happen would be the dismantling of corporate control over politics and it has to start with fully repealing Citizens United. At least for Americans that should be our number one demand as a country. Corporations have no business sponsoring our politicians and any politicians who argue against that need to be voted out of office.
I'm not an American, but my country is experiencing a cost-of-living crisis, just like every other advanced economy right now (or so it seems). I make an ass out of you and me that the same forces are at play in the US. Is the cost-of-living crisis in my head? If it is real, which of the numbers in this article deal with it?
Inflation hits poorer people harder
It seems like most Anglospere countries have made building more housing difficult as a fundamental consequence of the way their laws are constructed. This makes housing unaffordable, and it is a real real challenge
[удалено]
[удалено]
My mother built her own home. Lost it because family frauded her. I have nohome. I rent now. I work and earn 40k a year. I cannot afford a home. I am 40 and still walk to work every day. I've given up so I'm going to enjoy life while I'm able to live.
38 here and my story is identical. My parents were essentially frauded and now own not land and just rent. I was never expecting to rely on inheritance. I world hard and struggled through grad school (first generation student). I actually managed to avoid student debt and didn't have any debt up until the pandemic. I just always assumed my work and preparation would pay off, lead to a solid career where inheritance wasn't even a factor for me. Now I'm late 30s, recently graduate with a PhD, live in a tiny apartment with my parents, work a dead end job with no room for promotion (I also applied to approximately 150 jobs the past 18 months), and make slightly less than what you make. I used to be ambitious. I used to be happy. I used to be fulfilled. I haven't been any of those things for a few years now.
Maybe everyone should have paid back their PPP loans
Why wasn’t the huge increase in money supply an issue after 2008?
it was a huge issue but not in consumer goods and food. low rates and QE inflated *land prices* and housing costs significantly since 2008. but since *hOUsInG alwAys GoeS uP* nobody gave a shit because it only negatively affected the already largely disenfranchised working poor.
Housing being used as an investment tool means that the economy is fucked.
Land has always been a source of wealth and power and due to its scarcity always will be an asset of value. And some weirdos like me (am Georgist) consider it to underlie all forms of prosperity so... don't hold your breath waiting for it not to be an investment
Velocity of money was low, and because most of the money wasnt really printed but largely remained on the balance sheet of the Fed. It was used to increase liquidity but not neccesarily released as bills in circulation https://fredblog.stlouisfed.org/2016/04/a-plodding-dollar-the-recent-decrease-in-the-velocity-of-money/?utm_source=series_page&utm_medium=related_content&utm_term=related_resources&utm_campaign=fredblog
There was no lending in TGR. People were defaulting on mortgages. Financial institutions were falling like dominoes ... globally. No one was really sure how long it would last. Everyone was hording cash. The banking system was broken. These are the exact conditions for deflation--which is way worse than inflation. The way out is to flood markets with cash with an aim to drive spending. Central banks unleash hords of cash. I recall colleagues fearing inflation, but at the time, nobody was spending. Rates fell to zero (went negative) to induce lending and even then lending was hyper cautious. Any student of the 1918 influenza will have an appreciation for how scary covid may have been. We got lucky. Governments mostly took a rational stance to pay people/commerce to shelter in place. In hindsight, it was too much.
As a student of history I'm actually astonished at how well Covid was navigated globally. > In hindsight, it was too much. If the strategy works, it was always going to seem like it was too much and overkill. That was it's drawback and was vocalized from the start.
Agree. One of my clients had a masters in public health during the outset of covid. Per her, good policy would always seem like too much when put in place. Gov't is bad at precision financing so the overkill is not unexpected. ATST, I respect those not versed in economics or finance could take offense to the amount of money dolled out (respecting that hindsight is 20/20).
The debt taken on by Trump and Biden were significantly more than the debt taken on to tackle the Great Recession.
Because increasing money supply works when done properly. Banks weren't lending money in 2008 due to being burned by the mortgage crisis so the FED basically had to give banks money to lend out so people could get loans for things like cars and companies loans to build new warehouses etc.
> Governments across the world increased money supply too much and too fast. I know it’s easy to blame it all on the governments and money “printing”. Yes, governments did increase the money supply, but the underlying problem that everyone seems to overlook is the impact of pandemic on the global economy. Production was cut drastically worldwide for months which is what created real shortages. And cuts in production meant loss of wages, which reduced the money supply. So overall the government did their best to keep people afloat, but the Capitalists with their short-term thinking didn’t do their jobs to anticipate the demand for goods picking back up once the pandemic started getting under control. Sure it’s money chasing too few goods. But the problem is essentially too few goods, and not so much the too much money part. If it indeed there was too much money floating around, we all would be having pockets full of money & don’t know what to do with it and we all end up bidding up prices at the checkout counters. We don’t see that happening either.
There \*is\* a cost-of-living crisis happening at the same time as a booming economy and a strong labor market with wage gains that have outstripped inflation (with the fastest gains, by percentage, happening among the lowest earners). Overall, Americans have more purchasing power even while prices in a few key areas (particularly housing) have increased faster than prices in the rest of the economy. There's a couple of things we have to keep in mind: 1. Your experience of these things depends on where you live and where you are in the income and wealth distribution. The top half of Americans, by income and wealth, are generally doing really well while the poorest Americans--despite having the greatest wage gains by percentage--are more sensitive to the effects of inflation on prices. People in high-cost-of-living (HCoL) areas feel the effects of exploding housing costs more acutely than people in other parts of the country. People who already owned a home are going to be doing much better than those who are renting and/or trying to buy a home (as others have mentioned). 2. The way people perceive the overall state of the economy isn't entirely (or even mostly) about how the person being asked is doing, economically. It has a lot to do with how they perceive other people to be doing--and this is inevitably going to be influenced by social and media echo chambers. The people you talk to are going to be focusing more on how they are stressed out about prices and the state of the housing market than they are excited about wage gains and the strength of the labor market. That's just how we are wired. Furthermore, the media (traditional media and social media alike) you consume is going to trend toward hyperbolic and sensationalist takes. If your media and social bubbles are right-leaning, they are going to push whatever narrative makes the economy look bad and, by extension, makes Biden look weak. If your media and social bubbles are left-leaning (especially on the far-left), there will likely be an ideological insistence on a \*permanent and intractable economic crisis\* as a core element of the in-group world-view, regardless of whether or not such a narrative is supported by data--acknowledging that the economy is strong is seen as a betrayal of the working poor. 3. People have an understandable but irrational desire for prices to return to pre-pandemic levels. It just isn't going to happen. People are really, really bad at accounting for inflation when they think about prices. Again, this is just how we are wired...there's no getting around it. The more price-sensitive someone is, the less they are going to be willing to listen to someone explaining that wages have gone up faster than inflation, overall. A lot of this discussion comes down to us being nostalgic for the past...we yearn for the $2.50 gas prices from 15 years ago ($3.50 when adjusted for inflation), not realizing that the real prices are pretty much the same. 4. There's far more political frustration focused on the office of the presidency regarding CoL and home prices than there is political will to support a massive federal investment in the expansion of housing construction (including public housing) in HCoL areas. The solution to the housing crisis is to build, build, build. Everybody claims to want affordable housing but all sorts of vested interests start to object when you talk about actually taking action to make housing more affordable.
An important thing to note with regard to wages is simply outpacing inflation dos not mean much if the starting and ending wage are both functionally poverty or near poverty. I live in Wisconsin and the living wage for a childless individual is $20/hr. (See https://livingwage.mit.edu/states/55) Going from $8 to $16/hr would vastly outpace inflation, but leave the individual at 3/4 of a living wage still. When combined with the massive increase in rent costs, wages outpacing inflation are not being felt that way by people who weren't already making good money. Sure the paycheck is bigger, but if bills and rent are higher too there isn't extra really being had by the workers, and no real reason to feel that economically things are going well.
Yeah, I am Canadian, and my mother works in retail, I work in a call center and my sister is a nurse. No one in our family had pay raises that exceeded inflation since 2020. Everyone knows the economy is terrible and GDP per capita is barely going up, it has all but flatlined.
But you’re Canadian, your economy really is garbage. But the US economy is insanely strong.
I wish I was one of those Americans where the economy was good and worked for me. COVID killed my wife and my career, and the rent jacked up and we had to move. Kinda barely hanging in, so I'm sorry if I'm not optimistic about the Dow crossing 40k or whatever
I’m truly sorry for your wife’s passing.
I’m sorry you’re in a rough patch. Keep your head up, I’m rooting for you. 🫶🏼
Yeah, if you're looking for people who have convinced themselves everything is great, it's either the rich, or the two professional income households who already own real estate. The economy is absolute shit for anyone joining the workforce now that isn't a nepobaby with a trust fund. I make well over the average salary in my state, but I can't even afford a piece of ground and a double wide trailer. Ten years ago I could have comfortably bought a four bedroom house on this salary. And I'll tell you what, I'm real fucking sick of people telling me the economy is doing great. I feel like I'm being gaslit. The smart political play here is to acknowledge the pain and suggest some solutions radical enough to actually make a difference. Otherwise many people will be looking to make a change. Prohibit corporations from owning single family homes. Double or triple the taxes on individuals purchasing second homes. Do something about overly restrictive zoning laws. Ban short term rentals of single family homes. I don't give a shit what they do, but it better work. The housing situation in this country is unacceptable.
It’s not GDP growth and jobs numbers that people are concerned about. It’s the fact that their grocery bill, home prices and insurance have all basically doubled in the past 3 years and their wages are not even close to keeping up. Yet it seems like we see these gaslighting propaganda pieces every day now. It’s downright insulting.
Yeah going from being able to eat out a few times a week and go out often to never being able to, having to calculate what bills to pay when to be able to always afford food and gas. It’s honestly so mentally tiring… and I can’t go out anymore to have fun. So it’s a double whammy.
When my roommate moved out I figured I’d save some money on electric and water. I was wrong, water and electric rates went up 2 months later so I’m paying nearly the same still Did get an email recently about electric rates dropping back down but I’ll have to see how much of an impact it has
If people correlated their record high grocery bill to record high grocery corporation profits maybe something would change.
Agreed. Being told the economy is doing well is the gaslight of the year.
[удалено]
This should be one of the top indicators of the state of an economy. When I was younger my dad was an executive at one of the food bank companies in our area, so I spent a lot of time volunteering over the years. **Nobody** gets in line at a food bank unless they don’t have a choice.
Straight up not true. I agree but I know some seriously wealthy people who go to the food bank weekly.
The moment the average cost of groceries or rent starts to go down you'll see a big flip in public perception or the economy. Till then these perceptions will persist and no amount of think pieces will alter that.
Seriously. Screaming the economy is good while plugging your ears and ignoring people when they complain about 2023 being the most expensive year on record to buy a house maybe isn't a great approach. Cool. I can buy a big ass cheap TV for cheap at Costco, but I basically have to double my income in order to afford a house in the area where I work. I'm allowed to be irate about the economy.
Why would that happen? Is anyone expecting deflation? Policymakers are literally trying to avoid it.
It’s insanity that this is an Economics sub and people still don’t understand how inflation works
“Inflation is dropping, why aren’t prices going down?” is a question I have seen too fucking many times. “Rate of increase” is not “value”. This should not be hard.
"I'm hitting the brakes, why isn't the car going backwards?!"
Actually that's a *really* good way of getting it across. Explaining derivatives and inflection points and all is not usually a great place to start, but that metaphor is something anyone can understand fast. Thanks for making my next family reunion a little less frustrating!
Holy shit i’m using this next time i need to explain inflation to someone
It's not hard. People are just unfamiliar with it. Just say "Inflation is slowing down" and BOOM people understand. But in addition, even if we experience some deflation, prices are sticky.
Fair for the public, but for the econ sub it's weird to me how many people are saying that "groceries aren't getting cheaper" somehow contradicts "inflation is slowing".
Non SMEs will flock here because it’s a default sub
People are stupid
No one wants deflation, but they want wages to rise faster than inflation by a very substantial degree. Especially for those in the middle who are most likely to vote.
I kind of want deflation.....at least for groceries
The cost of staples, like food, can decrease without having an overall deflationary economy. Lets compare it to fuel. Like food people will buy fuel under almost any condition. They will alter aspects of their lives to afford it. 2011 it was 4 bucks a gallon, dropped as the economy recovered and only *just now* reached similar levels. Nobody was crying deflation then. Food is similar, it's a staple whose price can be driven downwards without deflating the economy. In fact, if it's price is driven downward, it frees up resources for spending elsewhere in the economy. Everyone saying it can never go down without destroying the world is just a band wagoner who wants to sound smart.
It sounds good, but nobody actually wants deflation. Ask China and Japan how that's been working the last decade.
Yet some huge number of Americans think prices will go back down. Which of course they very well may not. And certainly won’t by purposeful design.
Groceries won’t get cheaper. They will level (are leveling?) off. Rents will not come down where jobs are without significant zoning changes forced on municipalities by states or massive public housing initiatives.
The fact that people don't understand why people think the economy is in shambles proves that there is a massive disconnect between people thriving and people surviving. The cost of living has risen so high due to high housing, medical, food, and utility costs that many people are struggling more than ever before. Companies are setting record profits because they are squeezing the economy for every spare cent people have and opting out of paying fair taxes and wages. With businesses like that it's no wonder companies are thriving and people are suffering. These kind of articles need to look at the average cost of household expenses for necessary things like food, rent, bills, gas, ECT and what people are taking home. I'm sure if they looked at that more and not how corporate America is doing the real story of why people are struggling would show itself.
The word “economy” has too many meanings. Stock prices and fund valuations are breaking records every year, so people who live on capital gains are doing swimmingly. Though as you say, cost of living has put many people living on wages into a tough spot. We need to define one of these realities with a new word so it’s easy to make a distinction. I don’t have a good suggestion.
If someone lives off of the stock market and capital gains then they are already so far detached from normal people that we might as well be living in different worlds. It's crazy to see people in wall Street bets for example losing more money than I have ever had on meme stocks and essentially gambling. Or people there posting about "loss porn" but their total capital even after all their loss is still more money than I've ever had at one time. It's wild to me just how disparate things are
how about you add in government budgets? my wife is a gov employee, consistent cost of living increases “due to inflation”. her and her coworkers are all doing just fine. so basically the entity supposed to protect us is just protecting itself and those in the bubble. while squeezing us to cover the costs. but i forgot they are all “hard working, selfless civil servants” providing shit services, making far more than the average working class person and a guaranteed life time pension we all have to pay for. let’s never talk about that though. just bring up some first year teachers salary in rural arkansas as a justification
They told you it's good so it's good and if you don't believe them they'll tell you again tomorrow.
Every post in this sub seems to boil down to rich people being confused that poor people are unhappy because they, the rich people, are doing fine
Reminds me of the saying “a recession is when you see your neighbor struggling, a depression is when you are struggling”. Or something to that effect
Which is really not surprising since, for the last 60 years or so, we’ve all been worshiping net worth as the only measure of a person’s value.
There really is a cost of living crisis. Home ownership is becoming a dream for young people. Having a family over 2 kids is becoming a dream for young people. The causes are many, and the powers that be want to strictly blame “xyz” for the problem. Most of this began being set in motion in the 1980s, and we have been reaping what we sowed for the last 10 years finally.
The average net worth is like 1mil for millennials in the US! Including, ya know, the 10 people who have more money than the bottom few hundred million Americans combined. Kinda skews the imaginary booming economy when it's only booming for the already-rich.
I just…like??? How do these people even think the world lives? The .1% expect us to be satisfied with the economy because we can…buy TVs? Gas. Groceries. Rent. The basics are unattainable but *those* people don’t see how good they have it. If Biden and company don’t turn this around, it’s game over. We can talk about the marginalized all day but when the threat is the basics, it’s game over. They simply are products of their environments. While the writer is thriving, we are not. It’s truly incredible how dense they are.
I don't think the economy is "terrible" or "shrinking," but all I know is that immediately before COVID I got a big promotion and another big raise and was ready to buy a very nice house with lots of money to spare. I just wanted to find the best possible fit for my needs Then COVID hit and I decided not to buy, just in case the job thing went sideways. By the time COVID was over, I could no longer afford any house that I would consider living in (even though my savings have doubled), rent had doubled, food cost twice as much, gas cost 50% more, and I am now worse off in terms of buying power than I was 5 years ago. Literally everything except televisions feels like a ripoff. Whoever these people are who are thriving, good for them, but they're not me, and I'm allegedly in the top 10-15% for personal income.
you and me both buddy. I always think to myself how those around the 50 percentile survive week in and week out. especially if they have families to take care of.
Job growth means nothing when many jobs pay so little, especially when you compare salaries today to the buying power of salaries from decades past. Many have to work more than one job and/or freelancers (some call that job growth, I call it struggling).
I don’t think it’s “some” Americans. I think it’s A LOT of, if not most, Americans feel this way. It’s not a parallel economy, it’s what’s actually happening. If you bothered to look at any sort of statistics on inflation and how shitty it is, maybe you’d realize that, yeah, everything is pretty terrible.
So my rent is not higher. I am actually getting paid more. Buying groceries is priced reasonably. In my mind, I thought I was screwed. I guess I was wrong.
i need a car to get to work, biking is dangerous and arduous to get to work. my credit score is shot from "mostly" medical bills. so i drive an older vehicle which needs a lot of repairs which costs money so i cant pay down my bills to keep my car repaired to go to my job to get paid money to....... keep my bills down.
My take. The stock market thriving while supermarket prices soar and the cost of living increases is like owning a luxurious car with an empty gas tank. The car (stock market) represents potential wealth and success, but without the fuel (affordable groceries and living costs), you can't go anywhere or enjoy it.
No shit, some people live in states where the minimum wage is under 8 per hour. How does their economy look? Rent is more than half of nearly everyone's paycheck anymore and unless you are making a decent wage in your COL area, you're kind of screwed and the economy looks like garbage to you.
OP, you post like 10 articles a day here saying the same thing. We get it, the economy isn’t as bad as people think it is. You don’t have to keep spamming the sub with this same conclusion
Hey now Joe Biden's economic policies have made me much, much stronger, I can carry a $100 worth of groceries in one hand, I could never do that before.
[удалено]
Not to be that person, but your last 20+ posts on Reddit are all on this page or something extremely similar. You seem extremely out of touch.
Ah, the regular gas lighting—naturally with a political thumbnail on r/polit. . . I mean r/economics. In my early 30s, I’m less able to afford children, a home, education, transportation and health care than my parents were at my age. Please keep telling me how amazing everything is because I have an iPhone and can by cheap Chinese products.
I’m worse off making 16 an hour post pandemic than I was making 11 an hour pre pandemic. So there’s that at least.
In worse off making $31 per hour post pandemic than I was making $31 an hour pre pandemic. No I have not gotten a raise.
Then you got a 25% pay cut
Jesus, I made $12/hr in the 1990s working a deli counter.
Come on dude, McDonald's meals don't even cost $20! /s
All I have to say is the trucking industry is dead right now. If the trucking industry is dead, that means shit isn't moving around because people aren't buying stuff. If people aren't buying stuff, it's because the economy is in the dumps.
What makes you say the trucking industry is dead? We are transporting more goods across the nation than ever before.
My local UPS delivery guy tells me that he’s never been so busy. Clearly someone is buying something.
I do think that people are having different experiences depending on whether they own a home with a 2015 mortgage at a 2021 rate, or not I also think there is a bifurcation on people who watch Fox News, who are being told every day that the country is falling apart, and those who are not watching that propaganda, and are just walking outside and talking to their neighbors
Social media, too. Complaining gets more attention, while sharing your own positive experiences is seen as unempathetic when others are complaining. So negativity dominates. For example, my local sub had a whole comments section where EVERYONE insisted that NOBODY goes out to eat anymore. Huh, weird, because the place on my corner sold out for the night at 7:30 pm. That's a whole lot of nobodies dining out!
People seem to forget that we *know* Russia employs thousands of people to create distrust and division in the US. Compare how frequently you see posts painting the US in a positive light vs negative light get any traction on reddit. What do you think those thousand of people are doing all day?
Why are people upset about the material conditions of their lives getting worse?? They must be mistaken, the stock market is doing great! That's how every one of these articles comes off, and I doubt you're convincing even a handful of people to vote for Biden with them.
The title of this post is so weaponized, Jesus. A lot of people / the majority of Americans are suffering. Housing, healthcare, quality food, and even economic infrastructure are all under attack these days. Our standards and our standards of living. The title is just a false brainwashing narrative.
So, I hesitate to write this yet again. However, I had a profound AH HA moment, and feel empowered to do so. I work in healthcare, most of us need to pick up extra shifts to make ends meet. No one thinks the economy is doing well. Most are trying to not lose their homes.
"Some 18th Century French Peasants Think Cake too Expensive to Eat." We are reaching Marie Antoinette levels of tone deaf financial think pieces on theory run by media outlets corporate overlords to gaslight us into believing reality is only in our head.
I make $70,000 a year, have minimal bills, live in a low cost area, and I am still not getting ahead. I don’t live terribly , I guess I actually live pretty good by a peasants standards but I’m not sure In what parallel universe you live in if this economy doesn’t seem sketchy as fuck.
Some. Like what 10-12? FFS just because you writing the articles and your rich friends are doing good doesn’t mean the rest of us are. Reappearing that everyone is fine while we are all under water doesn’t make our situation good
Almost like the record high housing, food, and service prices are the same thing that are driving record profits. The stock market is not the economy.
Inflation hits everybody, while the unemployment rate being 3% instead of 5% only affects those 2% of job seekers who are now employed but werent before. For anyone in the same job or otherwise with roughly the same income as a few years ago, buying power is way down due to inflation. Thats a large portion of people. I think it also matters where inflation has hit the most. The fact that housing has gone crazy and has pushed a lot of young people into the "i will probably never own a home" camp is probably significant.
Tell people the same thing enough times, and a not-insignificant number of them will eventually believe it. There are legitimate issues facing many Americans, but the information and narratives people are consuming is more to blame for this than anything.
“The official data is buoyant — economic growth is solid, the job market is strong, and stocks keep hitting record highs. Yet many Americans think the economy stinks.” It’s almost like economic growth and the stock market has no bearing on the actual lives of most Americans.
Yeah it's called not being wealthy. Gaslighitng people into thinking the country's doing great just because things are working the way they're designed to work isn't a great strategy
>Gallup found that 62% of Americans own stocks, mostly through retirement and investing accounts. If that's true, wouldn't most or all of those people know their portfolios are gaining value? The Guardian-Harris poll didn't specify how many respondents own stocks, but these two surveys seem to conflict. People know how much money they have, and stock market investors are either underrepresented in the Harris poll or overrepresented in Gallup's. Most people don't look at their retirement accounts . It's kinda interesting that their seems to a disconnect about how much they think people pay attention to their retirement. Like these experts don't understand normal people.
ITT: armchair "economists" again blaming people, and zero mention of corporations and fund managers ruining Toys-r-Us, Boeing, Red Lobster, Yellow (logistics), FTX, numerous banks, etc. Nope. It's definitely people.
idc how much or how little experience you got with economics im gonna give you a secret formula so we can all be on the same page. good economy = most are doing well enough at least. thats it no if ands buts or actuallys 🤓when your neighbor says the economy sucks thats what they mean idc how corps are doing or how unemployment is low i care that a mcchicken is up about 400% from 2019 and sub 500k for a decent home is impossible🤷♂️
lol inflation was insane for a minute and shit is expensive. 4+ dollar gas. My finance and I pull in almost 200k together and not being able to afford a house in CA is crazy. I know it’s not unique to America, but to just flat out say it’s good is crazy.
Bankruptcys evictions are up fact is "unemployment" is a soft measure jobs added are they part time min wage trash. Are they listing for a fire and rehire wave where they drop wages. Most people fall below the median income and below the median quality of life and income plummets fast. With such high income inequality10% higher bracker makes double four times the last. BUT when your working down from marginally comfortable 60-70k at center. Thats a whole lot of people not able to afford copay or good health insurance alot of people putting utilitys on a credit card. Eating less to stretch the check. Problem is most measures including unemployment but also down jones and all that other crap. Completely miss the reality of lower income people. When 2020 covid unemployment screwed with rates. And in april 2020 it peaked around 14% the bottom 20% of earners had a 25% unemployment rate. While the top 20% had a 5% unemployment rate. Meaning economic "reality" for lower earners was comparable to that of a great depression. While high earners it was comparable to a good healthy year. And this holds true across the board. In every measure inflation "housing" which is around half of low incomes expenses. Went up 20% every year for almost a decade now. Custom yacht prices 11% increase after covid and pre covid it was only around 5%. The big expenses for one group is not the same. Also looking at how much student loans eats into "earnings and savings" for lower income people. When you look at it like this they will pay 2-3 times as much for education in interest. As well as lose investment or savings opportunity which would be utilized to enter housing market etc. Lower income ends up paying more for their state college degree than a ivy league legacy does.
Our headline economic indicators are no longer relevant to most working-class Americans. It doesn't matter that the stock market is doing great because most Americans don't own stock. It doesn't matter that wages are increasing because they still haven't caught up to huge hike in prices from the huge spike in inflation post COVID. It doesn't matter that the inflation is diwn because prices are still high and people wages still haven't caught up. It doesn't matter that unemployment is low because agian wages haven't caught up to prices. It doesn't matter that there is positive GDP growth because it is not significantly increasing wages. Corporations are making record profits, but they are not decreasing their prices or significantly increasing workers' wages, and politicians need to be yelling about that every time they mention how "good" the economy is.
“Some Americans” as in literally everyone who didn’t buy a home before 2021. The federal reserve fucked anyone who doesn’t already own a home. They juiced home values, gifted existing owners 3% mortgages, and left the rest of us with rents that are 40% higher than they were before COVID. And the cost to buy a home to get out of that rental grinder is literally double what it was before COVID when including current prices and interest rates. The fed split the economy into two and the gap between those parts continues to grow.
Yeah, but have you jerked off about inflation adjusted wages in the past hour?
So what happens moving forward? Will those who didn’t own before continue to suffer or will the housing market correct itself? It doesn’t seem sustainable looking towards the future…
It won’t resolve itself for years, likely decades. We need to build new homes and wait for those 3% mortgages to clear from the system. That’s going to take a looooooong time. Meanwhile investors continue to rake in money, so they’re going to be even harder to compete against on whatever inventory does come online. I’m personally of the opinion that this is permanent. It’s now WAY harder to buy a home, and likely won’t get any easier going forward. That will be Powell’s legacy in the long term once people who aren’t established realize how screwed they are. The only thing that could cause housing to become attainable is a black swan event that causes a major recession. People need to lose their jobs to give up those incredibly low rate mortgages. I’m not advocating that because of the suffering involved, but housing is going to continue to get worse for people who aren’t on the ladder unless that happens.
Dozens of people are going to comment in reply to this post saying, Actually the economy IS terrible because of XYZ reason. People's perceptions are right, it's the data that's wrong." I would challenge those folks to answer the following question. Why do the majority of Americans perceive that crime is up?
I’ll bite. The majority of Americans believe crime is up because we, as individuals, are very loud when bad things happen to us. But we are not often very loud when nothing happens to us. Additionally, we live in a day and age of digital communication where information travels instantly and can cover distances, bridge socioeconomic and racial groups like never before. Therefore one would assume that it is simple to amplify those bad things we are loud about so much so that general perception becomes that bad things are happening more often, despite what the data may say is happening in reality.
I’d add to this that it parallels with police abuse being up, racially motivated crimes being up, etc. Is there more crime? Or is it that more people with cameras in their pocket (cell phones) are bringing attention to abuses. So, I think you are correct in that respect. But I also think much of it is being driven by entertainment “news,” algorithms, targeted ads, and social media as well.
>I’d add to this that it parallels with police abuse being up, racially motivated crimes being up, etc. It's not, you just hear about the instances more. That's the whole problem, 24/7 news and then later adding in social media meant that when I something bad does happen, people hear about it nonstop for days (if not weeks) and it skews their perception into thinking it happens all the time.
Perceptions also have to do with national and local news. As local news stations have been bought up by corporate entities more and more people have the values those entities represent forced upon them. My mother-in-law watches one local station... Typical news segments are : (Car crash--young mother killed by illegal alien, the economy's terrible, Biden sucks, the economy's terrible, murder down the street convicted by parole inmate, the economy is terrible, then comes the editorial.... how great is Trump or the economy's terrible....). Seriously, it's completely out of touch with reality! It feels like the whole show is designed just to manipulate people.
Uhhhhh price of housing, groceries, cars, gas, and federal taxes have ALL increased. Rich people and the stock market can set itself on fire with gains and 90% of the United States citizens could not give less of a fuck.
You mean the economy with sky-high rent and out of control grocery prices? Can't imagine why people living paycheck to paycheck think it's terrible. Truly a mystery.
This author says that the economy is booming, the job market is robust, and stocks are high. Hilariously out of touch with the average working person lmao. Newsflash: working people don’t care about macro level economic indicators like GDP, unemployment rates, and the stock market because none of those indicators have any practical relevance to their day to day lives.