I'm just waiting for the financially ailing counties to start selling themselves in their totality to corporations and those corporations begin providing employment in exchange for literal cradle-to-grave services.
We don't have meaningful scarcity anymore, not for the essentials anyway. There is a finite amount of land but not a finite amount of housing units, because you can build arbitrarily many of them on top of each other. We can produce more food than people have any need to eat and producers then spend rather a lot of money convincing them to buy more than that. Medicine is only genuinely scarce to the extent that it's limited by labor availability, which means labor should move there and drive down the price unless something is constraining it.
But if you can make something like housing or medicine artificially scarce, you can suck all the surplus out of everybody's paycheck. And that's the problem.
Maybe an example of a person who makes a large some of money through having zero employees where they used to have many and where those people were replaced with automation and completely obsoleted.
Not challenging you, I'm just interested in your theory.
A phone/computer replaces all of those, but it's one product instead of hundreds. It doesn't take anywhere near the labor to produce as all of those things once did.
Not quite zero employees but numbers were reduced greatly, ie accounting. Example: accounting, before you needed a team of accountants for a mid level enterprise, not sometimes even one is sufficient.
Because I'm constantly gobsmacked by inefficiencies and companies that have too many people involved in achieving simple goals?
> Because I'm constantly gobsmacked by inefficiencies and companies that have too many people involved in achieving simple goals?
That is also true, by no means I am implying that. There is a lot of inefficiency in many companies, but at the same time what took X people in the past now takes X-Y people for many sectors, ie accounting. Another good example is website creation and development for Small-Medium Enterprise. In the 90-s/2000s you had to pay someone to create a website for you, where now there are countless website builders, some of which are really great.
If The Office was made today, you'd just have Oscar in accounting and Jim closing deals alongside a robocaller
This also implies that the ones that are able to buy an iPhone, will pay significantly more for it. Which will make the ones that can afford it even more narrow.
There is something wrong with the reasoning that losing a big part of the market has no influence on companies and consumers that are still able to afford things. This impacts everyone, there is no question about that. Maybe some more than others, but everyone will feel it.
This doesn’t match the actual unemployment numbers.
> Here’s the thing: from where I live, the world has drifted away. We aren’t precarious, we’re unnecessary. The money has gone to the top. The wages have gone to the top. The recovery has gone to the top. And what’s worst of all, everybody who matters seems basically pretty okay with that. The new bright sparks, cheerfully referred to as “Young Gods” believe themselves to be the honest winners in a new invent-or-die economy, and are busily planning to escape into space or acquire superpowers, and instead of worrying about this, the talking heads on TV tell you its all a good thing- don’t worry, the recession’s over and everything’s better now, and technology is TOTES AMAZEBALLS!
(disclaimer: not an economist, just a dude in an armchair with an Opinion)
The reason Apple's share price is booming is because "consumers" are buying their products so their earnings were great. Many of them probably spending printed stimulus money. Same for Amazon.
There is really no magic here except the illusion of unlimited money through quantitative easing.
The QE is the only thing holding things together, if that stops, everyone is going down the same drain to poop town.
Edit: I should also mention many investors are probably putting a lot of money into Apple as it's seen as a safe haven for equities right now.
I'd be amazed if it ends well, we haven't invented a perpetuum mobile yet...
I'm not an economist, just an interested investor and from my understanding, using QE on this scale is just an easy short term solution to a longer term, hard problem.
Printing money like this has never really been done before on this scale, but the fear is that "printing money" like this will potentially lead to very bad debt and hyperinflation inflation crisis (maybe already started).
The limitations of QE aren't entirely known, but will be known as more money is printed and money becomes more worthless.
Will having a lot of "monopoly money" in circulation be a problem? Time will tell; however there have been many examples where hyper inflation has caused economies to fail, such as Venezuela recently and the Roman Empire in the past.
The US Federal Reserve should probably be careful with their actions because they wouldn't be the first country to run into dire issues doing this.
What I fear is, the people at the top of the US are blinded by greed and the desire to be reelected and aren't concerned about the lessons of history.
But we've had QE for over a decade in various amounts and it didn't lead to inflation, unless there's direct monetisation (the fed prints money and gives it to the government to spend in an unlimited fashion) I'm not sure why the situation would change.
You are kidding, right?
have you seen what is happening in healthcare? Do you have kids in college? Have you tried to buy a residence in a large urban area like seattle, nyc, miami? Have seen what is happening to food package sizes ij most american supermarkets? Do you know the increasing rate of us retirees is no longer flocking to fl, but abroad? Do you realize that it is no longer possible for a working class family to sustain itself with 1 breadwinner? Do you wonder why?
Just because tech , internet, and freight efficiencies are keeping in check in some sectors of the economy doesnt mean there is no inflation.
We are heading into the lost decades of japan
Welcome to salaryman life , where you live in a shoebox amd expect no asset accumulation for the rest of your life
Small businesses are getting killed because the government deemed most of them "non-essential" so big boxes and eCommerce were the only things available, so of course Amazon, Walmart, Target, etc are all doing incredibly well. Their small competition was killed off. This pandemic has definitely worsened the transfer of wealth from the small hands to the large hands, and it's 100% the government's fault.
$1200 issued months ago?
Unemployment is high, but much lower than the initial surge from coronavirus. It's likely we're still seeing significant hour/shift reduction, but as lockdown measures relax that will mostly let up or those workers will shift to different fields.
We are seeing things shift away from brick and mortars, but that isn't new just accelerated. It seems like ecommerce is eating everyones lunch now.
The pandemic has probably accelerated a migration that would have happened anyway--but arguably slowed down the new grads moving into cities to replace them.
A lot of different factors come into play which I certainly don't claim to be able to predict--and will likely vary by city.
On the one hand, lower prices make urban areas/city cores relatively more attractive for those who want to live there. (I doubt living in the cores of top cities is ever going to be cheap; it wasn't in Manhattan in the 1980s.)
On the other hand, there may well be less need to be in a city for certain jobs. Furthermore, if city services are a mess, crime is up, and a lot of the restaurants and small businesses are closed, urban living may be less attractive.
"Low mortgage interest rates mean that home ownership is currently cheaper than renting...and would rule out the prospect of a significant increase in defaults... This is due to the low mortgage interest burden seen in recent years, as well as the fact that financing requirements have been tightened on several occasions. Specifically, this means a majority of home owners are unlikely to have any difficulty servicing their mortgage debt in the event of a temporary reduction in their income" (https://www.credit-suisse.com/ch/en/articles/private-banking...).
I think the thesis still holds up for owner-occupied homes. Residential, luxury, and commercial property market is a different story, although it seems that residential has bounced back, not sure about luxury, and commercial has gotten destroyed and is why Amazon is buying it up for cheap.
I think it's unfair to assume people are panic buying houses. The people I know that have purchased a house in the last six months would have purchased a home regardless of the pandemic. In addition, the threat of inflation is real and having a stable housing cost can help with inflation.
i'm glad that prices and interest rates are finally at a level that people can purchase a home. now hopefully these people have learned from others mistakes in 2007 and only buy a house that they can afford which usually means that your whole MIT payment (mortage + taxes + insursure) never goes above 25% of your monthly net income. things got crazy in 2007 when people were committing 50% or more of the monthly net income to their home payment in hopes that they could flip it in a year or so for a big profit. while this is fine for an investment property that you don't care about getting foreclosed, you never have that mindset with your primary residence.
No, getting into a risky, speculative, highly leveraged position that takes more than half your monthly income just to service the interest is not a good idea, period.
This was not simply a case of people being otherwise shrewd investors, making only the small mistake of making the object of their speculation their residence.