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Comment by herf | Hacker News Reader

I agree we are working through an asset bubble in tech and housing - P/E's went quite a ways above the historical line, as did housing prices.

But think about the chip shortage (automotive, consumer electronics) - raising interest rates does not "fix" supply and make prices lower. Think about oil & gas markets. Think about labor shortages.

When supply is broken, it's not only a monetary policy problem. Most of these things are "U-shaped" and not "V-shaped" - they will take longer to come back.

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Housing is not a bubble, at least not in the U.S.A. The prices are supported by a fundamental shortage of the product. It is not driven by speculation but demographic pressure.

I heard the same thing in the last housing bubble before 2008

Really? It was obviously not true back then and is obviously true now. Housing starts hit nearly an all-time record high in the U.S. in January 2006. But then housing starts almost hit zero in 2009, and have never recovered.

> housing starts almost hit zero in 2009, and have never recovered

‘Have never recovered’ can be misunderstood as if they were still ‘almost zero’ (which is also a bit of an exageration).

https://fullstackeconomics.com/the-2000s-housing-bubble-was-...

The reason there's a housing shortage is that almost all US cities have insanely terrible urban planning and zoning policies. There's no guarantee this will continue forever. In fact, I see quite a bit of evidence that Americans are gradually waking up to the fact it's possible to have decent, livable cities if you don't do everything completely backwards.

So, for instance, I think it's actually possible (not guaranteed) a substantial amount of housing will be built in the Bay Area in the next 10 years, which will decrease the willingness of people to pay $2M for a generic small house in a suburb.

I think there's been quite a lot of speculation in RE, actually. With rates so stupidly low, people have been purchasing rental properties as the only other investment besides stocks that made any sense in the last 2 years.

A bubble can still form on the back of strong fundamental growth trends. To the extent that people have convinced themselves that housing can't be a bubble because demographics are in its favour, they may also be willing to buy in at any price, and thereby make a bubble.

There is no chip shortage --- there is a lack of flexibility to upgrade PCB designs in Automotive .

It's not just automotive. It's everywhere. E.g. power supplies are apparently a big deal right now... And sure, you can't easily re-design, re-qualify, re-tool for something very different than what is in your design. Companies do that typically for EOL'd components but they usually have a bit more of a heads up and opportunity to buy some extra of those to buffer their redesigns.

The “chip shortage” was fake. The actual issue was inflation since the start.

I can't speak for it's relation to inflation, but have you _tried_ getting a new mid-range mirrorless camera or other similar electronic consumer good? Chip shortage is real.

The shortage was very much not fake, or I’m misinterpreting your meaning.

Could you elaborate? I'd love to read some analysis on this, but just claiming the whole shortage was fake has some real "no trees on flat earth" energy.

>The “chip shortage” was fake. The actual issue was inflation since the start.

Whew. Good new for me then! I guess I’m not 99 weeks out on a required part anymore.

99 weeks out?? :::jaw on floor:::

Don't worry, it's just the default value in the ordering system for 'we have no idea, probably never'

This is true. I have a ton of parts all with 52 week leads. It’s BS.

But… I’ve found that 52 means “Ok, no idea but it will come” and 99 means “lol yea dude, we’ll let you know but you should make other plans”.

inflation is (due to) shortage

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