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This Oxymoron Of Overpriced Oversupply

A report from Reuters on China. “The Chinese city of Enshi has moved to stabilize house prices amid a worrying property slump by urging developers to stop drastic price cuts, threatening punishing measures unless such ‘wrong behaviors’ stopped. Developers have slashed prices at some estate projects in Enshi, a small city with less than one million in the central province of Hubei, as many new projects further strained an already slowing market, according to a three-page document issued by the Enshi Real Estate Association to its members seen by Reuters.”

“‘Some estate projects have sought to promote sales by cutting prices drastically and this has caused wide concern in the society and had a negative impact on Enshi’s property market,’ said the document dated June 6, which listed ten ‘tricks’ developers had pursued to cut prices in various ways.”

From Quartz on China. “For decades, the burgeoning power of China’s middle-class has been promised as a cure-all for many of the global economy’s troubles (not to mention its own). Enriched by three decades of rapidly rising wages, Chinese consumers should have long ago begun turbo-charging sluggish economies everywhere.”

“That hasn’t happened. In past years, it’s largely been because they received a much lower share of national income than was their due. But there’s a new reason, one that should alarm both China’s leaders and the scores of foreign companies still waiting for China’s middle-class consumers to ride to their rescue.”

“After a decade-long real estate boom, home prices in many Chinese cities are unnaturally high. In Beijing and Shanghai, buying a home costs about what the average family would earn in 23 years if it spent none of its income. And in 2016, Chinese residents began splurging on borrowing, most of it in the form of mortgages—as well as untold sums of high-interest personal loans—to buy increasingly pricy homes.”

“For economists and other observers, the chronic thrift of Chinese consumers has long implied the existence of a backup engine for when growth stalled and corporate debt maxed out. ‘For years, there was this idea that China’s silver bullet for an economic slowdown was its high household savings rate,’” says Andrew Polk, economist at Trivium, a Beijing-based research firm.”

“Suddenly, however, what had been a rainy-day abstraction became a reality. Chinese consumers are now deep in debt. The Bank for International Settlements calculates that individual Chinese borrowers owe $6.8 trillion, as of December, up from $4 trillion three years earlier, much of it for home mortgages.”

From Rethink Tokyo. “China’s housing industry seems to have reached breaking point. Nikkei reported earlier this year that 65 million units are vacant across the nation. Sales volumes in 24 cities fell by 44% in the first week of 2019, compared with a year earlier. More worrying is the fact that many of these units are brand new and have never seen a tenant.”

“Whole residential communities on the outskirts of China’s tier two and three cities are turning into ghost towns before they ever come to life. It is a peculiar case, as the vast number of empty apartments, on the one hand, suggests gross oversupply, but on the other hand young Chinese people – especially men, who are culturally pressured to buy a home to attract a spouse – can simply not afford apartments.”

“Between 2015 and 2018, prices have surged by over 40% in some cities. This oxymoron of overpriced oversupply has seemingly been caused by a real estate industry of bad players that developed at break-neck speed and without much foresight. In fact, Moody’s Investors Service has assigned junk status to 51 of the 61 Chinese property companies it assesses.”

“One might worry that Tokyo’s real estate market will fall victim to a similar fate. After all, redevelopments are mushrooming all over the city here as well, prices are on the rise, and at the same time, the Japanese population is falling.”

From Nippon on Japan. “Japan’s latest Housing and Land Survey has found that a record 8.46 million homes were unoccupied in 2018, an increase of 3.2% on the level five years ago. This represents 13.6% of all homes (up from 13.5%). The increase is attributed to the growing trend of families to live separately from grandparents, who are themselves are rapidly aging, and is further exacerbated by the fact that Japan’s population is declining.”

“Emphasizing the seriousness of the problem, Yoneyama Hidetaka, chief researcher at consulting firm Think Dyne, explains, ‘It’s one thing if the building is properly maintained, but many houses are simply left to rot, and will eventually become eyesores.’ He adds that more vacant dwellings can also mean more crime and wastage of public services.”

The Wall Street Journal. “‘Modern monetary theory’ is the latest craze to circulate among the chattering classes. It is a fuzzy, post-Keynesian theory that has caught on in antiausterity circles. The MMT doctrine states that fiscal deficits don’t matter as long as countries borrow in their own currencies and inflation stays in check. This is like manna from heaven for proponents of more government spending and larger fiscal deficits.”

“Not surprisingly, MMT has reared its head in Japan, where debt is denominated in yen, inflation is nowhere to be found, and the ratio of government debt to gross domestic product has gone to the moon. MMT advocates claim Japan provides proof for their theory, but nothing could be further from the truth.”

“Separate, potent forces have given rise to two seemingly strange trends in the Japanese economy: dramatic changes in the savings-investment balances in the public and private sectors, and the failure of monetary policy. MMT doesn’t explain either one.”

“Separate from Japan’s overall savings surpluses, its broad-money metrics have grown at a snail’s pace. Since Japan’s bubble burst in 1990-91, broad money has grown at a paltry 2.6% a year, as measured by M2. In addition, since the 1950s money velocity has been negative, decreasing at an average rate of close to 2% a year. This is one of the most striking and consistent macroeconomic relationships on record. Japan’s slow broad-money growth mixed with a contracting money velocity has held down nominal GDP growth.”

“As long as M2 growth in Japan remains minimal, low inflation—or outright deflation—will prevail regardless of whether the public and private sectors are running savings surpluses or deficits. As Milton Friedman counseled, ‘Inflation is always and everywhere a monetary phenomenon.’ The same is true of deflation. Money dominates.”

“According to the Bank of Japan, the basic idea of interest-rate targeting is that if interest rates can be pushed low enough, sooner or later companies or households will start spending. But as Irving Fisher showed a century ago, interest rates follow inflation; they don’t precede it.”

“MMT advocates would have us believe that governments can run deficits without limit as long as they are financed by securities denominated in their own currencies—at least until inflation takes off. What they fail to understand is that budget deficits have nothing to do with inflation, unless they are financed by rapid broad-money growth. Money dominates economic trends, and classical monetary theory tells us why. Beware of those peddling MMT snake oil.”

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  1. The Wall Street Journal. “‘Modern monetary theory’ is the latest craze to circulate among the chattering classes. It is a fuzzy, post-Keynesian theory that has caught on in antiausterity circles. The MMT doctrine states that fiscal deficits don’t matter as long as countries borrow in their own currencies and inflation stays in check. This is like manna from heaven for proponents of more government spending and larger fiscal deficits.”

    https://guerrilla-capitalism.com/articles/the-disturbing-rise-of-modern-monetary-theory-mmt/
    The Disturbing Rise of Modern Monetary Theory (MMT)
    Mark E. Jeftovic January 21, 2019
    “MMT-ers believe that currency is nothing more than an economic scoreboard or tally, and any government that denominates it’s own currency can never go broke because they can always create more currency. Of course, as Weimar Germany, Hungary, Yugoslavia and more recently Zimbabwe and Venezuela have all found out, you have to watch out for hyperinflation.”

    https://www.epsilontheory.com/modern-monetary-theory-or-how-i-learned-to-stop-worrying-and-love-the-national-debt/
    Modern Monetary Theory or: How I Learned to Stop Worrying and Love the National Debt
    January 17, 2019 by Ben Hunt
    “Modern Monetary Theory – which is neither modern nor a theory – is a post hoc rationalization of political expediency and power-expanding action.
    It makes us feel better about all the bad stuff we’ve done with money and debt for the political efficacy of Team Elite.
    And all the bad stuff we’re going to do.”

    “Alice laughed: “There’s no use trying,” she said; “one can’t believe impossible things.”
    “I daresay you haven’t had much practice,” said the Queen. “When I was younger, I always did it for half an hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.”     – Lewis Carroll, Through The Looking Glass

    “Never invest in any idea you can’t illustrate with a crayon.” – Peter Lynch

    1. It’s just the beginning. They’ll be building FHA-backed igloos in the desert by the time this cycle is over.

    2. Back when Dubya sent checks to everyone the debtors could pay down their debts and the others could take their family shopping.

  2. Weird tonight

    I went to Stubs in south east Boise” for taco Tuesday it’s usually packed

    Three couples there?

    Coincides with the homes for sale that are back on the market

    I think Boise has hit the tipping point

    1. ABQ Dan didn’t predict a Chinese debt bubble. He predicted a robust economic expansion and argued that Chinese economic data was by and large accurate. Most of us begged to differ.

      1. Chinese debt bubble

        He said their debt didn’t matter because they owed it to themselves! Also that they all saved 50% of what they earned. Wrong, wrong, wrong.

        1. “…debt didn’t matter because they owed it to themselves.”

          Isn’t that part of the Green New Deal doctrine?

          1. Yes. And when I made the statement about Chinese debt it was completely true. Since then there has been some increase in foreign debt but it is still low. Thus China is still not Turkey. China is facing a rapid reduction in its growth rate however it still has the ability to engage in massive stimulus and quantitative easing. Thus whether it even has a technical recession is debatable. Only slower growth is a virtual certainty

      2. Sorry you are entitled to your opinion but not alternative facts. A number of years ago pre Trump when most on the then board were predicting the imminent collapse of China, I stated it was far from a collapse and its economy has grown more than 30 percent since I made that statement. I always stated that China overstated its growth but by only 1 to 1.5 percent and when a country is growing at a claimed 7.5 percent a year like it was that is minor. I changed from being a bull to bear on China when Trump was elected due to the fact that o knew he would address both trade deficits and intellectual property theft. Sorry while my timing on oil may not be perfect your timing on China has been equally flawed. However oil prices are almost double what they were when a made the bullish call and within a few years will be much higher. As far as China I have been much more accurate than you and that is why they are challenging the US as Trump realized

          2. It was a board when the predictions occurred. BTW on that board I stated that Chinese tech was becoming a threat to US tech and that was a least five years ago. Find ant bullish statements I made about China since the creation of the blog. You cannot everything changed when Trump became President. You can see the Obama policy in Biden. Deny there is even a problem. Of course his son raking in the bucks from China is a good part of it. The globalists want Biden. Thus fake polls to promote the view he is the strongest democrat and will beat Trump. In fact, Trumps popularity is very high, much better than the day of his election. The PTB, use fake polls to shape opinion not to reflect it.

          3. Adan. No argument on the globalists. It wasn’t a “board”. You were head over heels in love with everything about China. Now you forget. Mania is like that.

            It was and is the biggest smoldering pile of debt and corruption in history.

          4. Read this last night:

            China’s debt disease might wreck its uncrashable housing market
            Gwynn Guilford
            June 11, 2019

            “After a decade-long real estate boom, home prices in many Chinese cities are unnaturally high. In Beijing and Shanghai, buying a home costs about what the average family would earn in 23 years if it spent none of its income. And in 2016, Chinese residents began splurging on borrowing, most of it in the form of mortgages—as well as untold sums of high-interest personal loans—to buy increasingly pricy homes. With somewhere around $6.8 trillion in personal debt, with most wrapped up in real estate, the risks of a sharp drop in prices setting off a financial crisis akin to that of the US or Spain in 2008 are rising. The alternative, however, is only slightly less ominous.”

            “New analysis reveals that consumer debt rose at a much brisker clip than the GDP or household disposable income. Thanks in large part to this latest home-price boom, Chinese consumers are now stuck shelling out more of their income covering debt payments than ever before—and a greater share of their incomes than their counterparts in the US, Germany, France, or Japan. If this continues, Chinese consumers may soon find themselves too overwhelmed by debt payment to power the consumption boom foreign companies, trade partners, China’s own leaders, and, indeed, the world economy have been counting on.”

            https://qz.com/1615596/chinas-debt-disease-is-infecting-its-housing-market/

  4. A report from Reuters on China. “The Chinese city of Enshi has moved to stabilize house prices amid a worrying property slump by urging developers to stop drastic price cuts, threatening punishing measures unless such ‘wrong behaviors’ stopped.”

    There’s no argument that this is a centrally-planned, command economy, and yet it’s apparently lost on many/most that these are exactly the same policies in the U.S. when the Fed continuously interferes in the stock and housing markets. Since the same interventionist actions, with the same intent of keeping house prices artificially high, applies in both cases, the end result of the self-inflicted housing bubbles will also be the same. Not sure if the Chinese enjoy popcorn during the show as we do here in America? Maybe popped rice? The idea is the same.

    1. Not sure if the Chinese enjoy popcorn during the show as we do here in America?

      They do. But they sugar it instead of buttering it. Or they just skip straight to the chicken feet.

    2. Kind of reminds me of a tweet that I once liked:

      “Under communism you buy everything from a single state outlet, whereas under fully-mature capitalism you buy everything from Amazon.”

    3. “…these are exactly the same policies in the U.S. when the Fed continuously interferes in the stock and housing markets.”

      Bingo…we have a centrally planned financial economy, covered up by propaganda and denial.

      1. I read a long-form news article on what a scandal baby formula is in the US. Many new WIC moms get coupons for baby formula, but evidently someone isn’t too strict about how much formula, or when to stop the coupons. When the kids are weaned (or breast-fed), the moms get their formula anyway and sell it to a middleman for cash. Or, people will buy or shoplift baby formula and sell it to a middleman for cash to fuel a drug habit. The middleman then sells the formula overseas to Chinese moms who don’t trust their own country’s formula.

        Grocery stores around here keep baby formula in a locked case behind customer service. I always wondered why; now I know.

        (on a side note, I was at the store the other day and saw that they now keep Tide Pods in the same glass case. Are Tide Pods *still* being used as currency? Ah, nothing like water-soluble money. 🙄 )

        1. Tide Pods in the same glass case

          Probably because of the Tide Pod Challenge in which an individual consumes Tide Pods.

        2. Tide Pods

          Dangerous for little ones and for some reason stupid teenagers. See “Tide Pod Challenge”.

          1. So Help Me God, I’m Going To Eat One Of Those Multicolored Detergent Pods

            “Anybody who knows me will tell you the same thing: I get what I want. Whether it’s food, being held, my binky, you name it—if I decide I’d like it, you d*** well better believe I don’t rest until I get it, one way or another. And from the very second I saw those blue and red detergent pods come out of that shopping bag last week, I knew immediately that, come hell or high water, I would eat one of those things.”

            https://www.theonion.com/so-help-me-god-i-m-going-to-eat-one-of-those-multicolo-1819585017

  6. Hey, middle class, the housing crisis is coming for you next
    Patrick Sisson
    June 11, 2019
    Curbed

    As housing prices keep rising, new study finds Americans higher and higher up the income spectrum feel the pinch

    “Charlotte, North Carolina, one of the Southeast’s biggest cities, is short 34,000 affordable housing units. A booming job market has attracted 100,000 new households to the city since 2000, and supply hasn’t kept up with demand. In Salt Lake City, Utah, there are more families than available places to live, a shortage of about 54,000 units. It’s the most severe manifestation of pricing pressure in a state where housing costs can run higher than both Las Vegas and Phoenix. This deficit comes after a year when Salt Lake City led the nation in homebuilding. In Columbus, Ohio, the housing market has cooled after ever-higher prices exhausted buyers who simply can’t keep up with rising costs.”

    “If you break down the nation into five income groups, the crises faced by the fifth group—or the lowest-income—are increasingly being seen within the fourth group, the lower-middle class. The fifth of the country with the lowest income spends 60 percent of their money on housing, while the next-lowest fifth spends 40 percent, both significantly higher than the 30 percent recommended by economists.”

    “Middle-class Californians, many of whom have recently moved to other, more affordable, areas in the West, like Boise, Idaho, and most new homebuyers looking to buy in the nation’s largest cities, would probably tell you there’s long been an affordability crisis across the income spectrum. And it’s an issue that’s grown over decades: According to a 2017 report done by the St. Louis Federal Reserve Bank, the median price of single-family housing in the U.S. outgrew the rise in median household income by 390 percent between January 1986 and July 2017.”

    1. Not a lot of good options when housing prices (mortgage or rent) becomes onerous. The article posits 3 options:

      1) Cost (e.g. become a FB and become house poor)
      2) Crowding (e.g. double up with other families, move back in with parents, in-laws, etc.)
      3) Commuting (e.g. drive ’till you qualify)

      All of those 3 options are terrible and have negative repercussions on quality of life. In the land of the free and home of the brave, too many are stuck between a rock and a hard spot because of this housing bubble.

      1. stuck between a rock and a hard spot

        Actually the opposite has been happening for the past several decades. The herd has been buying bigger and more expensive houses with the sure hope of becoming rich through leverage in real estate. Those of us who have tried to live within our means and avoid the speculative bubble are in the minority.

    2. This is as per the script…
      http://www.washingtonpost.com/wp-dyn/content/article/2010/11/03/AR2010110307372.html
      What the Fed did and why: supporting the recovery and sustaining price stability
      By Ben S. Bernanke
      Thursday, November 4, 2010
      “Easier financial conditions will promote economic growth. For example, lower mortgage rates will make housing more affordable [ really? more (or less) affordable?] and allow more homeowners to refinance. Lower corporate bond rates will encourage investment [stock buybacks]. And higher stock prices will boost consumer [elites/1%ers] wealth and help increase confidence, which can also spur spending. Increased spending will lead to higher incomes and profits that, in a virtuous circle, will further support economic expansion.”

      1. If he really believed what he did was ok, there would be no need or reason for ‘splaining it.

      3. Lower interest rates will encourage builders raise the price of homes even higher than they are now. You know, “free money”.

        You’re going to see the bubble blown up larger, and more buyers priced out of ownership.

    3. “According to a 2017 report done by the St. Louis Federal Reserve Bank, the median price of single-family housing in the U.S. outgrew the rise in median household income by 390 percent between January 1986 and July 2017.”

      It was so kind of the Fed to use quantitative easing to kick housing prices back up into bubble territory after the 2007-2009 correction, in order to ensure lasting damage from the mispricing and misallocation of wealth into housing.

    4. 1. It was the policy of globalists to inflate housing prices to keep the consumer economy growing despite losing our manufacturing base.

      2. Chain migration and illegal immigration has kept the population increasing while available land is diminishing. When you go from probably 220 million people to 320 million people and inflate the size of the houses it will have an impact on price. See 1 why the globalists did not see that as a problem.

      1. Oh…and here I was getting a chuckle out of “illiteration”. I need to find a way to use that in future.

  9. Utah man accused of hitting girl with car ‘because she was white’ charged with attempted murder

    By Gretel Kauffman, KSL | Posted – Jun 7th, 2019 @ 7:01am

    DRAPER — A driver police say told officers he intentionally hit an 11-year-old girl “because she was white” is facing charges including attempted aggravated murder, a first-degree felony.

    Officers on scene similarly described Becky as “uncooperative, aggressive, and non sympathetic” toward the child. According to a police report, the girl was transported to Primary Children’s Hospital with serious injuries, including a fractured hip and head injury.

    In an interview after the crash, Becky told police he hit the girl on purpose “because she was white,” according to charging documents.

    He also told a doctor who treated him at Intermountain Medical Center that he used LSD and mushrooms, the charges say. Police said they believed Becky was under the influence while driving.

    Bail was set June 1 at $255,000.

    https://www.ksl.com/article/46568565/utah-man-accused-of-hitting-girl-with-car-because-she-was-white-charged-with-attempted-murder

      1. Obviously a very mentally ill person. This is my father’s area of Draper. Very nice area.

  10. “Suddenly, however, what had been a rainy-day abstraction became a reality. Chinese consumers are now deep in debt. The Bank for International Settlements calculates that individual Chinese borrowers owe $6.8 trillion, as of December, up from $4 trillion three years earlier, much of it for home mortgages.”

    Speaking of Chinese consumers in debt, a few hours ago I noticed a For Sale sign leaning against the garage of our Chinese neighbors’ place, in full view of the street. They must be in a hurry to sell, or maybe their used home salesperson charges extra for a proper yard sign, as I can’t recall ever having previously seen a For Sale sign displayed in such a haphazard manner.

    They paid $450K for a small 2br attached home, which was $50K over the comps half a decade ago. It should be interesting to see what they recover upon selling, especially if they decide to price high and chase the market down, as many are doing these days.

  11. There’s an accidental portmanteau in my misspelling: illiterate + alliteration = illiteration

  12. “…urging developers to stop drastic price cuts, threatening punishing measures unless such ‘wrong behaviors’ stopped.”

    It must be tough for a society long accustomed to the command-and-control pricing intrinsic to communism to accept the equilibrium price adjustment process of the free market.

    1. This problem is going to be exacerbated because beginning in grade school you are introduced to the phrase “Without the Communist Party, there is no new China.”

      People are told that all economic development is thanks to the steady meritocratic hand of the Party.

      This works on the way up — you are richer today, and that’s solely because of the Party. How does it work on the way down? If growth is thanks to the party, isn’t a contraction also their responsibility?

      1. It’s a little bit like when DJT takes credit for the stock market. If you take credit on the way up, you’ve got to be prepared to take credit on the way down (probably why he is pushing Powell so hard to give him what Obama had with easy money policies).

  13. “The MMT doctrine states that…”

    Is it a theory, or is it a doctrine? Or perhaps just a load of claptrap cooked up by an evil coalition of economists and liberal politicians who pay them to come up with cockamamie ideas?

  14. Japan has a shrinking population, arguably so has China ( but the official data won’t show that, just yet).

    2. So has the world, in 30 or so years.

      Shrinking global population should benefit the have nots over the haves, for once.

          1. My views on the well being of the have nots are clouded by the homeless encampments I pass through every time I park more than three blocks away to attend an event in downtown San Diego.

  16. “Many of these new cities are not expected to be complete or vibrant until 15 to 25 years after they begin construction. They are built for the distant future, and at present, we can only speculate on what form they will have taken when they reach this point in time.”

    I’ll venture to speculate that unoccupied cities will quickly be overrun by vermin and weeds, rendered unfit for human habitation by natural forces acting to return the land to a primitive state.

  17. 8.46 million homes were unoccupied in 2018, an increase of 3.2% on the level five years ago…The increase is attributed to the growing trend of families to live separately from grandparents

    I would have thought more family units would lead to less vacant houses.

    2. Sounds like those diet plans where their clients can eat full meals and lose weight simultaneously.

  19. “The MMT doctrine states that fiscal deficits don’t matter as long as countries borrow in their own currencies and inflation stays in check. This is like manna from heaven for proponents of more government spending and larger fiscal deficits.”

    One thing it seems to miss is all those Yellen bux that get purposed for useless speculative gambles along their journey up to money heaven. The opportunity cost of misallocated real resources and wealth doesn’t seem to be part of the discussion among people who believe that digging ditches, then refilling them with dirt, is a useful occupation.

  20. China’s empty homes may prove a bigger threat than Donald Trump’s tariffs
    Analysis By business reporter Michael Janda
    Updated Wed 15 May 2019, 8:46 PM AEST
    A row of tall apartment and office towers are under construction in Yujiapu, China’s Manhattan-inspired ghost city.
    – Citi says vacant property is not just confined to “ghost cities” such as Yujiapu, a district in Tianjin. Supplied: Wade Shepard

    Build it and they will come. That is the philosophy underpinning modern China’s urban fields of dreams.

    In some senses they have, and do, come. But they are not residents or businesses in many of China’s gleaming new towers. They are investors — speculators betting that property values only go up as China’s population moves indefinitely in just one direction, from country to city.

    It’s been a good bet for a long time, but analysts warn, like all good things, one day it must come to an end.
    …
    The reason for the long-term concern? The number of empty properties in a country already renowned for its ghost cities is still rising.
    …

    1. I’ve seen these investors scoop up new developments. They stand out very easily in the countryside where these new cities are being built.

      Locals earn less than 3,000 RMB ($430) per month, but the units are all over $160,000. Somehow, the parking lots are filled with Mercedes, Porsche, and BMW… Just normal local farmers who save 50% of their salary and invest I guess!

  21. Are you worried that a recession shock may wipe out 30% of the value of your stock HODLings?

    For the record, I believe the 2007-2009 crater was bigger.

  22. Of course, the oversupply will remain overpriced. Why should it not, when the sellers know full well that the Fed remains on standby to support the house prices no matter what?

    1. support the house prices

      It’s not enough to keep house prices level. If they aren’t going up they are worthless, or worse.

      1. I agree with that as well because these houses are pathetic as sources of income. In Si Valley, if you get a house for 2M, rent it for 4K a month, monthly prop taxes are 2K, which means annual income of 1.2% on investment. And that is before any expenses for insurance, maintenance etc. Unless you are getting price appreciation, those are terrible investments.

        1. Very true. It seems most of the money extracted is through loans on the equity. That can continue a little while with no appreciation but not very long. Then it will impact the economy. That is what is truly sad, you can be perfectly responsible in these bubble areas and still experience job loss due to the impact of a housing crash

    2. That is the problem in a nutshell. Founding fathers created the gold standard for money. With fiat money created by both printing press and the federal reserve, if the PTB do not want the nominal price to fall bad enough it will not fall. Now the real price adjusted for inflation is more difficult to manipulate but government can still make it higher with sufficient policy support. It is the other side of the coin to what Trump did with the tax changes where houses which created tax liabilities over the SALT deductions are dropping in price

  23. If people are paying 40% to 60% of their income on shelter it’s a crying shame.

    The reason the majority middle class grew so strong in USA was because prices tracked with wages. Now we live in Casino Nation .

    This isn’t capitalism but rather something like the 1850’s to 1910 in USA whereby the deck was stacked against the worker bees.

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