A weekend topic starting with Strong Towns. "Between 2000 and 2005, the median home price in Southern California grew by 117% from $241,350 to $524,020, an increase of more than $280,000, or $56,000 per year. In 2005, the median household income in Southern California was $53,600. In other words, the median homeowner made more from home appreciation than the median family earned in income. And, with the ability to do a cash-out refinance or simply take out a home equity loan, much of that appreciation could be accessed to increase family spending, even to pay the mortgage. American homeowners had come full circle, from humble beginnings pursuing housing as basic shelter to participants—some reluctant, some eager—in the bubble mania of housing as speculative financial instrument."

"This commodification of the housing market was a primary factor in the 2008 recession, and a reflection of how ordinary citizens get squeezed when the housing industry and policy makers focus on factors other than providing shelter for a broad swath of the population that needs it. California has experienced a vast exodus of hundreds of thousands of blue-collar workers who cannot bear the state’s cost of living. The intense upward pressure on cost of living was felt earliest in America’s most expensive cities: coastal hubs of high-tech and other white-collar employment such as San Francisco, Seattle, New York, Boston, and Washington, DC."

KRQE in New Mexico. "The Greater Albuquerque Association of Realtors released its December report, finding that as housing prices went up, the median income stayed the same, making it far harder for people to qualify to purchase a home. According to the GAAR report, the affordability measure, which is based on median incomes and median sales prices, was lower than what it was during the 2007-2008 housing crisis. The median home price in 2023 was $345,000. Just two years earlier, it was $290,000."

KOTA in South Dakota. "The Rapid City housing market doesn’t have a large inventory. Over the last four years, housing prices have increased more than $100,000, making it more difficult for first time home buyers."

The Associated Press. "Higher energy and housing prices boosted overall U.S. inflation in December. Much of the public remains exasperated by higher prices. Prices are still 17% higher than they were before the inflation surge began and are still rising. 'Our grocery bill has doubled,' said Megan Cherry, a psychologist who lives with her husband and children in Temple Terrace, Florida. 'We’ve got to change how much we get of each thing. Our kids noticed recently that, ‘Wow, we eat a lot of chicken.’ Well, because we can afford chicken.'"

The Pittsburgh Post-Gazette. "It’s impossible to overstate how badly Pennsylvania’s system of real estate taxation works, and in particular how dire the situation is in Allegheny County. A coming wave of rulings on Downtown assessment appeals will not only obliterate the budgetary projections of the three taxing bodies — the county, the City of Pittsburgh and Pittsburgh Public Schools — but will also drain their current reserves. That’s because the appeals are retroactive, and will trigger massive refunds to commercial property owners. This doomsday scenario is due in part to misfortune: The COVID pandemic sucked the life out of Downtown, and there’s no sign of recovery to pre-pandemic occupancy levels."

KPBS in California. "High housing costs, including rents, are partly to blame for San Diego's high inflation, University of San Diego economics professor Alan Gin said. 'That's helped drive up the cost of living,' he said. 'On top of that, we also have among the highest electricity rates in the country, and they're rising rapidly.' Even for people who could afford to buy, it might still be cheaper to rent. According to the latest study by Construction Coverage, an industry trade news site, it costs 113.6 % more to buy than to rent in San Diego."

"Realtor Voltaire Lepe said said the median price of a home in San Diego was $840,000, making the monthly mortgage payment, with 7% interest, about $6,200. 'You have that option to buy, $6,200 payment, or you could rent that same home for about $4,500,' he said. 'So the difference is $1,700 that a renter would be saving on a monthly basis.'"

Business Insider. "When LinkedIn told engineering managers to pick out the lowest-performing workers to place on performance-improvement plans early last year, it felt to many like the end of an era at a company. 'There seemed to be a shift towards what some people felt was an antagonistic approach towards the workforce, where they rescinded certain benefits and perks with our communities,' said one engineering manager who was asked to rank his team members. The manager would go on to lose his own job, as did 136 other engineering managers axed by LinkedIn in October as part of sweeping 700-person job cuts — the first to directly affect engineering teams. The company had earlier laid off 716 sales, operations, and support workers in May."

"Like other tech firms, LinkedIn and its employees benefited from a decade of ZIRP, the zero-interest rate environment that led to lofty tech valuations, which gave rise to big salaries and splashy perks. The effects were compounded by COVID-19, as millions of people spent the majority of their time online during lockdowns. Then the ZIRP era ended. Inflation took hold. Interest rates shot up. Nearly half a million employees are estimated to have lost their jobs at tech companies over the last two years. Satya Nadella, CEO of LinkedIn's parent company Microsoft, said in a January 2023 memo that companies were cutting back on digital spend."

"The pain of this shift was felt across Big Tech companies, but it was particularly shocking at LinkedIn, which was known for what some called a 'rest and vest' culture. 'For years, there was a semi-joke that some people in Big Tech go to LinkedIn to retire,' a current engineer told BI. 'It was very rare to get fired or let go at LinkedIn in the past.' Now, according to another current worker: 'We still have a monopoly in the space, but to achieve the same level of growth we've had in the past, more work has to be put in. It's not an easy win anymore. I think those stressors have trickled down to the employees.' The 'golden days' officially came to an end in early 2023, some workers said, and culminated in layoffs by year-end."

"And LinkedIn isn't alone in pushing for growth and efficiency. After three years of pandemic growth, most of the major US tech firms laid off staff and were rewarded by investors for focusing on efficiency over expansion. 'The broadly defined tech industry mistakenly assumed that the growth they saw in 2021 could persist, but it was always unlikely to occur,' Madison and Hall analyst Brian Wieser told BI. 'Once reality set in — amplified by the realization of higher interest rates and overstated concerns about an economic downturn, which of course never happened — they started reducing spending on many activities.' ' We'd become bloated and a lot of people were spinning their wheels for a time,' the current employee said. 'We needed a reprioritization.'"

KQED in California. "After viral TikTok influencer Keith Lee suddenly cut his visit to the Bay Area short on Thursday, just twelve days into 2024, I can’t help but wonder: Are the Bay Area’s struggles actually worse than we’ve been telling ourselves? He’s generally seen as conscientious, with no history of mindlessly tarnishing small businesses, let alone diminishing an entire region. But the Bay Area unsettled him. This is the first time Lee has ended a trip on short notice, explaining, in a farewell video, that he '[doesn’t] believe the Bay is a place for tourists right now… the people of the Bay are just focused on surviving.'"

"Perhaps there’s something to be said for why, despite the Bay Area’s sparkling reputation as a food destination, Lee seemed unable to find very much that was even half-decent to eat. But when he implied, for basically the first time in his career, that the Bay Area is too out of pocket, too distressed, too dysfunctional, too disarrayed, too unsafe, too everything except whatever trendy food-take people wanted to hear, I felt him. His seeming dissatisfaction with the Bay Area wasn’t even mostly about the food. It was about our living conditions."

"Check the housing prices. The other day, my dad genuinely asked me why I don’t consider buying a mobile home for my family because it’s 'still affordable.' My wife and I have a son, and we both have master’s degrees. We’ve worked tremendously hard as first-generation college graduates. And we can’t afford much more than a room or two here. Many people here don’t have the time or money to chase after the most trending meal. They don’t even have regular access to meals. Period. How many more people living in tents do we have to pass by before we reach a collective tipping point?"

The Wall Street Journal. "The Federal Reserve ran an operating loss of $114.3 billion last year, its largest ever, a consequence of its campaign to aggressively support the economy in 2020 and 2021, then jacking up interest rates to combat high inflation. The losses added to already large federal deficits that have required bigger auctions of Treasury debt. The central bank’s losses could continue for as long as short-term interest rates remain near current levels. The U.S. central bank announced preliminary, unaudited results of its 2023 financial statements on Friday. During the first nine months of 2022, the Fed transferred $76 billion in earnings to the Treasury. In September of that year, it began running a loss, and it ended the year recording a $16.6 billion deferred asset. Until 2022, the Fed had never in its 109-year history suspended remittances to the Treasury for a meaningful period due to operating losses."

"Fed losses are a side effect of its efforts to support the economy during the Covid-19 pandemic by purchasing large amounts of Treasury and mortgage-backed securities. The market value of those securities dropped after the central bank began raising rates aggressively in 2022 to combat inflation, but the Fed doesn’t book losses on them because they are held to maturity. Instead, the Fed is running losses because it is paying more in interest than it earns on those securities. Those holdings consist primarily of Treasury and mortgage-backed securities that it accumulated during bond-buying stimulus programs between 2009 and 2014 and again between 2020 and 2022. The central bank maintained a relatively small portfolio until the 2007-09 financial crisis, after which its holdings of Treasurys and mortgage bonds swelled and it revamped how it manages interest rates."