This link came via Bloomberg. It discussion

https://www.bridgewater.com/its-mostly- ... everywhere

Low Interest rate
Inflation
production
demand
supply chain
inventory
housing
etc.

it is a very weird market, but one that will also start to balance. The Stimulus is ending , slowly, People will return to jobs, and some of the goods demands that spiked will subside. The services demand will not go quite as high. My expectation is that services were higher for awhile just because people with no jobs, but had income could travel and spend more wildly. I don't think we will see a crash in prices, but inflation will continue and smooth out over the next year.

Another factor not discussed is how many people are awash with cash and other assets. In my extended family, from low income near poverty to very well off, all of them (and their formers LOL) are doing about as well as they every have. What to do with the money??? There are homeless camping on the streets, and even they might say they are doing better than ever. grrrrrrrr

BLS has just announced that they undercounted new jobs by almost half a million. Another part of inflation, which really is a good thing, those very low paying jobs are now paying a lot more. Not enough more to put those workers in the middle of the 'middle class', but possibly out of the category 'working poor', to at least low middle class.

https://www.washingtonpost.com/business ... ob-growth/

I also think it is interesting that, when the Stock Market reached all time highs, everyone was saying how great the economy was. The Stock Market hit a record last week and everyone is now saying how terrible the economy is. As I suspect, it depends on who is in the White House, even though that has little to do with it.

Biden is blamed for supply chain issues but, the fact is ports do not have enough qualified workers and there is nothing but empty containers to ship out. Biden has zero influence over any of that. I suppose we could suspend OSHA and let just any person work any crane at any port. What could possibly go wrong?

Maybe if we didn't import so much stuff that we used to make here - like refrigerators, tires, other appliances, etc. Oh and PPE and base pharma.
I thought the Administration was going to do something about the trade deficit?

MohawkWeekend wrote:

Maybe if we didn't import so much stuff that we used to make here - like refrigerators, tires, other appliances, etc. Oh and PPE and base pharma.
I thought the Administration was going to do something about the trade deficit?

Every WH claims they can but it’s a pipe dream. So long as the Wall Street ethos remains chasing short-term quarterly results, we will not be making base items here at home. Investors have preferred cheap imports for over 30 years and counting. The longer term outlook in the 50s and 60s yielded a lot of domestic production..look at how that changed after the Arab oil shocks.

Consumers also like their cheap chinese goods, don't put it all on wall street.

MohawkWeekend wrote:

Maybe if we didn't import so much stuff that we used to make here - like refrigerators, tires, other appliances, etc. Oh and PPE and base pharma.
I thought the Administration was going to do something about the trade deficit?

You mean the Trump administration, right ?

Aesma wrote:

Consumers also like their cheap chinese goods, don't put it all on wall street.

MohawkWeekend wrote:

Maybe if we didn't import so much stuff that we used to make here - like refrigerators, tires, other appliances, etc. Oh and PPE and base pharma.
I thought the Administration was going to do something about the trade deficit?

You mean the Trump administration, right ?

Investors prefer them because of the success of the cheap consumption strategy, yes. But let’s not beat around the bush - in the US, this means holding wage and union growth down.

Aesma wrote:

Consumers also like their cheap chinese goods, don't put it all on wall street.

MohawkWeekend wrote:

Maybe if we didn't import so much stuff that we used to make here - like refrigerators, tires, other appliances, etc. Oh and PPE and base pharma.
I thought the Administration was going to do something about the trade deficit?

You mean the Trump administration, right ?

No seriously I thought Biden had a plan too.

I just find it odd that we have such open trade with a nation that threatens us and just about everyone else with war.

MohawkWeekend wrote:

Aesma wrote:

Consumers also like their cheap chinese goods, don't put it all on wall street.

MohawkWeekend wrote:

Maybe if we didn't import so much stuff that we used to make here - like refrigerators, tires, other appliances, etc. Oh and PPE and base pharma.
I thought the Administration was going to do something about the trade deficit?

You mean the Trump administration, right ?

No seriously I thought Biden had a plan too.

I just find it odd that we have such open trade with a nation that threatens us and just about everyone else with war.

Because it's all about the Benjamins - that's why everyone went there. A bad year for Wal-Mart going back to 2005 is $5B net. Toyota opened their GAC venture in Guangzhou in 2004 and has exploded in PRC since. Citibank went in there in 2007. In just 15 years PRC has become almost 40% of German luxury auto brands' market.

None of these corporate entities or their investors want to turn back the clock on those returns. Are you really expecting the .01% to operate on *principle*?

This really isn't a 'China' thread, but I will comment that if you look at significant research even in US universities there more often than not at least one Chinese researcher. At this time goods we receive from China are essential to the economy of the US. It is an extremely important supplier and trade partner of the US, and an unfriendly partner too boot. There are enough issues and information that a 'China' thread could be useful. But, No, China is not the cause of our odd economy, just part of it, and not all that big a part.

Going back to the title of the thread, our economy is certainly odd. At least the pieces I see. The shopping center down the street, every single store and restaurant has a help wanted sign on the front door. A couple of the restaurants have reduced hours/days open not due to lack of demand but lack of staff. So the jobs are there, but people don't want them/don't want them even at the higher wages being advertised. Will wages for retail and service jobs have to go up more? What will that do to prices and inflation?

The question I have about this odd economy: Where are all the previous restaurant servers, bartenders, retail workers, baristas, etc. working? I completely understand not wanting to go back to that type of work without a substantial pay raise, if at all. But where are they working now? And if they're not working, how are they surviving? Have they found jobs in other sectors? Or decided to stay home permanently (working spouse, maybe savings on daycare offsets loss of one income?)? Where did all these workers go?

People are not returning to work (1) because all income groups still have more money than they did in 2019, meaning they certainly don’t need any kind of stimulus and (2) covid panic is still pulling kids out of school constantly, meaning parents can’t really return to work the way they could before the covid-19 panic. This is all because we are supposed to protect the unvaccinated people, who don’t care about dying of covid in the first place.

With these incredibly bad policies and deep interventions by the government men and women, there is no wonder that unnatural things are happening to the normal Americans. Things we will all be paying for for a long time. To renters, I say God help you. Rents will rise faster than wages for years to come.

LCDFlight wrote:

People are not returning to work (1) because all income groups still have more money than they did in 2019, meaning they certainly don’t need any kind of stimulus and (2) covid panic is still pulling kids out of school constantly, meaning parents can’t really return to work the way they could before the covid-19 panic. This is all because we are supposed to protect the unvaccinated people, who don’t care about dying of covid in the first place.

With these incredibly bad policies and deep interventions by the government men and women, there is no wonder that unnatural things are happening to the normal Americans. Things we will all be paying for for a long time. To renters, I say God help you. Rents will rise faster than wages for years to come.

I understand where you’re coming from but you’re essentially asking the medical profession to pick and choose who they mitigate for and that’s just not the ethos of the field.

TangoandCash wrote:

The question I have about this odd economy: Where are all the previous restaurant servers, bartenders, retail workers, baristas, etc. working? I completely understand not wanting to go back to that type of work without a substantial pay raise, if at all. But where are they working now? And if they're not working, how are they surviving? Have they found jobs in other sectors? Or decided to stay home permanently (working spouse, maybe savings on daycare offsets loss of one income?)? Where did all these workers go?

There are certainly quite a few couples who have realized they can trim costs and negate the need for a second income, especially with expanded CTCs.

As for where some service workers have gone, one analyst at work has a crude theory: Onlyfans. Just 150 subscribers at $20/month is $3k, tax free. And that’s before tips and such.

LCDFlight wrote:

Rents will rise faster than wages for years to come.

Rent control is back on the table in many towns and states. It is only a matter of time IMO until is it implemented nation wide.

https://www.bostonglobe.com/2020/01/17/ ... ol-secure/
https://www.wbur.org/onpoint/2019/06/19 ... california

https://www.ft.com/content/986731f0-8ef ... a2ed2bc366
UN warned, supply chain problem will cause an additional 1.5% inflation on consumer price, globally, and especially in developing countries

Dieuwer wrote:

LCDFlight wrote:

Rents will rise faster than wages for years to come.

Rent control is back on the table in many towns and states. It is only a matter of time IMO until is it implemented nation wide.

https://www.bostonglobe.com/2020/01/17/ ... ol-secure/
https://www.wbur.org/onpoint/2019/06/19 ... california

If rent control is implemented nationwide, then you can expect that both rents and homelessness will skyrocket nationwide. Who will build apartments? Who will maintain existing ones, the tooth fairy? The cheapest rents are available in places with the fewest regulations. Rooming houses, old buildings, ease of constructing new ones, eviction of deadbeat tenants to free up housing for workers, etc.

Similar things are happening elsewhere (without necessarily the same decisions taken by politicians, but all influenced by COVID of course).

Here in France the hospitality industry is having trouble recruiting too. I was hearing on the radio this morning that a restaurant in Marseille was offering waiters 2000€/month to work the lunch shift Monday-Saturday. No work in the evening. Yet he was missing 2 waiters. 2000€/month is the median salary in France, I didn't think any kind of waiter could get such a salary outside working in a 3 Michelin star restaurant (or if the job involves nudity...).

LCDFlight wrote:

Dieuwer wrote:

LCDFlight wrote:

Rents will rise faster than wages for years to come.

Rent control is back on the table in many towns and states. It is only a matter of time IMO until is it implemented nation wide.

https://www.bostonglobe.com/2020/01/17/ ... ol-secure/
https://www.wbur.org/onpoint/2019/06/19 ... california

If rent control is implemented nationwide, then you can expect that both rents and homelessness will skyrocket nationwide. Who will build apartments? Who will maintain existing ones, the tooth fairy? The cheapest rents are available in places with the fewest regulations. Rooming houses, old buildings, ease of constructing new ones, eviction of deadbeat tenants to free up housing for workers, etc.

Large, government regulated corporations will build and maintain the rental apartments. Just as it is done in many countries in Europe. The model basically changes from one of "for profit" to one of "regulated utility".

Dieuwer wrote:

LCDFlight wrote:

Dieuwer wrote:

Rent control is back on the table in many towns and states. It is only a matter of time IMO until is it implemented nation wide.

https://www.bostonglobe.com/2020/01/17/ ... ol-secure/
https://www.wbur.org/onpoint/2019/06/19 ... california

If rent control is implemented nationwide, then you can expect that both rents and homelessness will skyrocket nationwide. Who will build apartments? Who will maintain existing ones, the tooth fairy? The cheapest rents are available in places with the fewest regulations. Rooming houses, old buildings, ease of constructing new ones, eviction of deadbeat tenants to free up housing for workers, etc.

Large, government regulated corporations will build and maintain the rental apartments. Just as it is done in many countries in Europe. The model basically changes from one of "for profit" to one of "regulated utility".

Large corporations already build and maintain rental developments. There are many in my area of the US being built by corporations. I guess I don't grasp why they would continue to do that, if they are not allowed to charge suitable rent to pay for the construction and maintenance. Where would that giant river of guaranteed money come from, if not renters? Me? There aren't enough rich people in my city to pay for everyone's life expenses.

If the US military, healthcare and federally subsidized higher education costs are any indication, US government housing units would cost 3x-5x what they cost in Europe. There isn't that much money in the world.

If local building codes and specification took costs into account, needless regulations and delays add upwards of 30% to the cost of building sturdy, safe, adequate housing. Too many building code officials, in my limited experience of building, have a real screw the public attitude.

LCDFlight wrote:

Dieuwer wrote:

LCDFlight wrote:

Rents will rise faster than wages for years to come.

Rent control is back on the table in many towns and states. It is only a matter of time IMO until is it implemented nation wide.

https://www.bostonglobe.com/2020/01/17/ ... ol-secure/
https://www.wbur.org/onpoint/2019/06/19 ... california

If rent control is implemented nationwide, then you can expect that both rents and homelessness will skyrocket nationwide. Who will build apartments? Who will maintain existing ones, the tooth fairy? The cheapest rents are available in places with the fewest regulations. Rooming houses, old buildings, ease of constructing new ones, eviction of deadbeat tenants to free up housing for workers, etc.

You seem to forget that a lot of companies are shifting their needs post-pandemic and HR organizations are being tasked with formulating a more flexible workforce untethered to 'base' locations - this will mean a glut of commercial office space and those buildings will be ripe for residential conversion if suitable.

Aaron747 wrote:

LCDFlight wrote:

Dieuwer wrote:

Rent control is back on the table in many towns and states. It is only a matter of time IMO until is it implemented nation wide.

https://www.bostonglobe.com/2020/01/17/ ... ol-secure/
https://www.wbur.org/onpoint/2019/06/19 ... california

If rent control is implemented nationwide, then you can expect that both rents and homelessness will skyrocket nationwide. Who will build apartments? Who will maintain existing ones, the tooth fairy? The cheapest rents are available in places with the fewest regulations. Rooming houses, old buildings, ease of constructing new ones, eviction of deadbeat tenants to free up housing for workers, etc.

You seem to forget that a lot of companies are shifting their needs post-pandemic and HR organizations are being tasked with formulating a more flexible workforce untethered to 'base' locations - this will mean a glut of commercial office space and those buildings will be ripe for residential conversion if suitable.

Good point, but having the free market do it would be much cheaper (lower rent) than having the US military or healthcare system equivalent do it. Subsidized housing has a large history… most of it unfortunate, particularly in the USA, where it has worked horribly. The system we have breeds urban violence and despair. It wasn’t that way 200 years ago, before subsidized housing. Housing market worked fine - and would work better now that racial discrimination is illegal in employment and home lending.

If building a housing unit cost 100 last year, it shouldn't cost 110 this year and 120 next year. The cost of the land might go up some, but for a building of dozens of flats, it isn't that big a cost. And affordable housing is often built on public land, instead of an old public building, etc. Housing prices going up very fast is due to speculation not building costs.

Here part of the financing comes from savings accounts, almost every French people has a "Livret A", even kids, and the money on it is earmarked to loan to construction companies building affordable housing.

As for laws, all cities must build at least 20% of affordable housing, and all new projects must include affordable units.

LCDFlight wrote:

Aaron747 wrote:

LCDFlight wrote:

If rent control is implemented nationwide, then you can expect that both rents and homelessness will skyrocket nationwide. Who will build apartments? Who will maintain existing ones, the tooth fairy? The cheapest rents are available in places with the fewest regulations. Rooming houses, old buildings, ease of constructing new ones, eviction of deadbeat tenants to free up housing for workers, etc.

You seem to forget that a lot of companies are shifting their needs post-pandemic and HR organizations are being tasked with formulating a more flexible workforce untethered to 'base' locations - this will mean a glut of commercial office space and those buildings will be ripe for residential conversion if suitable.

Good point, but having the free market do it would be much cheaper (lower rent) than having the US military or healthcare system equivalent do it. Subsidized housing has a large history… most of it unfortunate, particularly in the USA, where it has worked horribly. The system we have breeds urban violence and despair. It wasn’t that way 200 years ago, before subsidized housing. Housing market worked fine - and would work better now that racial discrimination is illegal in employment and home lending.

Subsidized housing doesn’t work in the US because it was largely designed to keep certain minorities away from suburbs and city areas where people in power decided they were unwanted. Pretty shitty starting point.

https://www.city-journal.org/new-york-p ... using-trap

I just walked in for an oil change - I have 12,500 miles on my car. The dealership is trying to get me to sell it back to them for $6,000 more than the price I paid.

Odd, indeed.

stlgph wrote:

I just walked in for an oil change - I have 12,500 miles on my car. The dealership is trying to get me to sell it back to them for $6,000 more than the price I paid.

Odd, indeed.

There is so much money sloshing around in the average household. Everybody qualifies for better loans than normal. Meanwhile the supply of cars is down due to the chip shortage. It’s crazy.

LCDFlight wrote:

stlgph wrote:

I just walked in for an oil change - I have 12,500 miles on my car. The dealership is trying to get me to sell it back to them for $6,000 more than the price I paid.

Odd, indeed.

There is so much money sloshing around in the average household. Everybody qualifies for better loans than normal. Meanwhile the supply of cars is down due to the chip shortage. It’s crazy.

The so-called Japanese Disease has hit most of the developed world. Most slighter higher than middle class including retirees have more money and more coming in than they need. They need places to park and/or invest money. Likewise companies and even counties are in the same crazy boat. Hence in large part a high stock market and low paying bonds.

frmrCapCadet wrote:

LCDFlight wrote:

stlgph wrote:

I just walked in for an oil change - I have 12,500 miles on my car. The dealership is trying to get me to sell it back to them for $6,000 more than the price I paid.

Odd, indeed.

There is so much money sloshing around in the average household. Everybody qualifies for better loans than normal. Meanwhile the supply of cars is down due to the chip shortage. It’s crazy.

The so-called Japanese Disease has hit most of the developed world. Most slighter higher than middle class including retirees have more money and more coming in than they need. They need places to park and/or invest money. Likewise companies and even counties are in the same crazy boat. Hence in large part a high stock market and low paying bonds.

Not just the affluent and rich. The US has handed out many trillions of dollars exclusively to the low and middle income households (plus airline pilots). This has raised the number of people competing for new cars who ordinarily cannot afford them...