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Inflation Wins and BlackRock Knows It
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One thing BlackRock’s voracious acquisition of residential real estate across the country at rates far in excess of market listings indicates is that the econoclysm we’re early on in won’t be a repeat of 2008. Inflation isn’t transitory, it’s perennial. If the Fed had any intention of raising rates, BlackRock wouldn’t be paying 30% above asking for houses.

If the Fed raises rates, the housing bubble bursts. Large numbers of adjustable rate mortgage rate holders default. They’re only a small fraction of borrowers. What about all those homeowners who have locked in rates?

They’re still unable to sell for what they’re able to now. Homeowner A would like to sell his $300k house with a 3% mortgage rate to prospective buyer B. A’s monthly mortgage payment is $2,000. New mortgage origination rates are a lot higher now, though. B’s monthly payment on that $300k home, at 8%, is $3,000 a month. That’s a grand more than A is paying for the same property. For B to afford A’s life, the $300k house is going to have to sell for $200k so B can get the same $2,000 monthly payment A currently has. Though A has a great rate for the times, if his house will only sell for $200k now and prior to the price drop he only had $50k of equity in the house, he’s underwater on his fixed rate mortgage. There will be many such cases.

Is BlackRock or JP Morgan really going to pay $400k for A’s $300k house when monetary tightening will push the listing of that house down to $200k in a few years? If Big Finance knows the Fed isn’t going to fight inflation–and the incestuous nature of these the Fed and the banks that own it is legendary, so they know what the Fed has in mind–it also knows nominal prices of everything will go up. Prices will increase at accelerating rates. There will be an abundance of dollars and shortages of everything else, including residential real estate.

The important thing in that situation–the situation we’re in now, because the Fed not only won’t fight inflation, it can’t fight inflation–is to gobble up as much of the real estate market as possible, whatever the price. The money to buy is borrowed for free anyway.

Free money to acquire residential property and then rent that property out for? Sounds like a pretty nice perpetual income stream for asset management conglomerates to get their hands on. Those perpetual income streams are lucrative, very lucrative. Just ask Moderna, Johnson and Johnson, or Pfizer! And if it doesn’t pan out the way BlackRock would like it to, they’ll just get bailed out by their friends at the Fed and the Treasury.

You’ll own nothing and you’ll be happy. UBI will cover the subscriptions you need to live, albeit with nothing left over at the end of the month. It’s a new spin on an old arrangement. Get used to the term “neo-feudalism”. It’s going to come up a lot in the coming years.

 
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  1. Man, your financial posts are the best, A.E.! This thing with BlackRock is a big deal not just in and of itself, but, as you say, it’s part of a large trend toward this Neo-Feudalism. (I’ve never written that term before, but yeah.) Was the Kung Flu PanicFest designed to aid and abet this trend?

    BTW, I’m not sure if you have already explained the 2 reasons why the FED cannot raise interest rates:

    1) That will bust the US budget so badly that everyone will see the $ for what it is. (“Your cash ain’t nuthin’ but trash.”) Were it to go up to just 7%, the interest payments on the now-$27,000,000,000,000 would be something around 40% of the Feral Gov’t expenditures. It’s easy to figure from the pie charts that are still near the back of the IRS 1040 instructions .pdf’s.

    2) The stock market will tank, due to people having a non-risky place to get returns from (not real returns, necessarily, after inflation), but at least not losing much of it each year. Since Americans see their houses and their 401-k’s as their biggest assets, people would become a lot poorer on paper quickly.

    • Replies: @notanon
    @Achmed E. Newman


    Was the Kung Flu PanicFest designed to aid and abet this trend?
     
    i wouldn't be surprised

    our corrupt elite's policies (currency debasement, off-shoring, mass immigration etc) were always going to bring America down eventually and as we got close to the edge of the cliff (with the possibility of a backlash against them) it would be convenient for them if they had:

    a) a scapegoat for the looming economic collapse

    and

    b) an excuse for having a high tech gulag in place beforehand in case people got uppity

    (and if it wasn't them then at the least I'd say they were taking advantage of the panic for those two reasons).
  2. You’ll own nothing and you’ll be happy. UBI will cover the subscriptions you need to live, albeit with nothing left over at the end of the month.

    Gee, where did I read something using similar terms?

    https://www.unz.com/anepigone/its-not-transitory-its-the-new-normal/#comment-4714697

    • Agree: Achmed E. Newman
    • Thanks: Audacious Epigone
  3. If BlackRock are doing this to make money, they are mistaken. It is a big risk in the short run that interest rates go up and the property market crashes. You argue that, on some level, they know otherwise. I doubt it, even if they are gambling that way, but fine.

    The real problem, though, is that house prices are greatly determined by local supply; and local supply is extremely restricted. The more local voters who are owners, the greater the NIMBY vote.

    If BlackRock buys up entire neighbourhoods, BlackRock still gets zero votes. The renters within those houses get a lot of votes. The political incentives to allow more housebuilding become huge and houses get much cheaper.

    BlackRock just manage too much money and asset prices are stupidly high so they don’t know what to do.

    • Replies: @anon
    @Triteleia Laxa

    If BlackRock are doing this to make money, they are mistaken.

    Could be. Or it could be that Black Rock's team knows more about this than you do. Which strikes you as more likely?

    The real problem, though, is that house prices are greatly determined by local supply; and local supply is extremely restricted'

    That varies across markets depending on both the available land and zoning regulations. There's a lot of push to revise US zoning laws now, too, and "infill housing" has been a thing for over 20 years.

    Residential RE is a different market from commercial RE, and in both cases there is a physical object that can generate cash flow.

    Replies: @Triteleia Laxa

    , @Robert Dolan
    @Triteleia Laxa

    Dumbass.....Blackrock doesn't CARE about profits.

    Black rock is in the business of goy control.

    You are such a dipshit shill.....utterly transparent.

    You are going to have to try a LOT harder.

    Replies: @Triteleia Laxa

    , @Athletic and Whitesplosive
    @Triteleia Laxa

    The "political incentive" of an electorate strongly in favor of policy x doesn't matter at this level of business entrenchment in politics/media, hence why America is the way it is. I mean it's debatable if there's any "democratic" arrangement where public opinion really matters and has a big impact on policy, it's more that the preferred policy of the elite is pushed strongly on the public and inevitably makes progress.

    In municipal politics it's mildly more "impactful" maybe, but not really that relevant. Even if zoning is relaxed and more houses allowed to be built there's a million ways an extremely wealthy encumbent could either torpedo it in the end or leverage it to their ultimate advantage.

    Replies: @Triteleia Laxa

  4. Overly greedy elites may be suffering from hubris in thinking this widening gap between the rich and the poor will continue. We’ve seen the radicalization of the left with movements like antifa. In nineteen thirties Germany, the rise of a Communist oriented left resulted in many Germans throwing their support behind the Nazis to block a Communist takeover of the country. They ended with the dictator Hitler. This wasn’t the first time something like this occurred in history. The excesses of the Jacobins in the late 18th century led to many of the French looking to Bonaparte to establish order. In short order, they too found themselves with a dictator.

    The U.S. had a revolution in the late 18th century which turned out much better than the French one. Rather than being influenced by French Enlightenment figures like Voltaire, Diderot and Rousseau they were influenced by the more moderate Scottish Enlightenment figures like Smith, Ferguson and Hume.

    If we want to avoid ending up having a dictator in this country, we would do well to go back and read the writings of the leaders of the American Revolution along with the Scottish Enlightenment figures who influenced them and apply what can be learned from them. The major economic treatise of the Scottish Enlightenment was Smith’s Wealth of Nations. Smith planned to write a major political treatise after that but passed away before he had a chance to do so. The American disciples of Scottish Enlightenment thought included Madison, Hamilton and Jay. They wrote something that would probably have resembled Smith’s unwritten political treatise: The Federalist. The only possible solution to our current problems is to return to the ideas that made the U.S. the wealthiest and most free country in history.

    • Agree: scrivener3
    • Replies: @Twinkie
    @Mark G.


    If we want to avoid ending up having a dictator in this country
     
    Let us have a Franco and be done with it.

    I am henceforth a Franquist (or Francoist). It even sounds vaguely Hispanic. And Asians will support anything that restores school quality.

    Replies: @dfordoom

    , @Eric Novak
    @Mark G.

    “ The only possible solution to our current problems is to return to the ideas that made the U.S. the wealthiest and most free country in history.”
    America will have a Third World political majority by the end of this decade. Why don’t you know this?

    , @Observator
    @Mark G.

    Seems to me that crediting the material success of the United States to an economic ideology entirely misses the point of what actually happened. The new country started out with the fabulous advantage of access to the untouched mineral and agricultural wealth of three and a half million square miles of land, the incredible abundance of vast offshore fisheries, and the labor stolen from over ten million African slaves.

    You would have to be a total fool not to profit under these conditions, the crackpot theories of Adam Smith notwithstanding.

    And speaking of Smith, the inventor of the "invisible hand" theory was a social philosopher whose ultimate goal was the good of the community. In keeping with the radical rejection of revealed religion which defined the Enlightenment, he discarded the traditional notion of divine providence in human affairs. In its place he postulated a similarly magical force which, by encouraging the selfish greed of the most avaricious members of society, would ultimately uplift all. He unconsciously embraced the peculiar passions of upper class Englishmen - arrogance, greed, and competition - as axiomatic of humanity’s motivation in all times and under all conditions. Ricardo and Malthus, and a host of subsequent, more rational economists proved him wrong almost immediately, and his works lapsed into obscurity.

    Smith’s revival among the voodoo economists of today's neoconservative movement is a smokescreen for their plan to replace the America we love with a tyrannical oligarchy of wealth. As the all-too-often selectively quoted Adam Smith actually said: "All for ourselves, and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind."

    Replies: @Thorfinnsson, @Mark G.

  5. @Mark G.
    Overly greedy elites may be suffering from hubris in thinking this widening gap between the rich and the poor will continue. We've seen the radicalization of the left with movements like antifa. In nineteen thirties Germany, the rise of a Communist oriented left resulted in many Germans throwing their support behind the Nazis to block a Communist takeover of the country. They ended with the dictator Hitler. This wasn't the first time something like this occurred in history. The excesses of the Jacobins in the late 18th century led to many of the French looking to Bonaparte to establish order. In short order, they too found themselves with a dictator.

    The U.S. had a revolution in the late 18th century which turned out much better than the French one. Rather than being influenced by French Enlightenment figures like Voltaire, Diderot and Rousseau they were influenced by the more moderate Scottish Enlightenment figures like Smith, Ferguson and Hume.

    If we want to avoid ending up having a dictator in this country, we would do well to go back and read the writings of the leaders of the American Revolution along with the Scottish Enlightenment figures who influenced them and apply what can be learned from them. The major economic treatise of the Scottish Enlightenment was Smith's Wealth of Nations. Smith planned to write a major political treatise after that but passed away before he had a chance to do so. The American disciples of Scottish Enlightenment thought included Madison, Hamilton and Jay. They wrote something that would probably have resembled Smith's unwritten political treatise: The Federalist. The only possible solution to our current problems is to return to the ideas that made the U.S. the wealthiest and most free country in history.

    Replies: @Twinkie, @Eric Novak, @Observator

    If we want to avoid ending up having a dictator in this country

    Let us have a Franco and be done with it.

    I am henceforth a Franquist (or Francoist). It even sounds vaguely Hispanic. And Asians will support anything that restores school quality.

    • Agree: mc23
    • Replies: @dfordoom
    @Twinkie


    Let us have a Franco and be done with it.
     
    The problem with getting a dictator is that it's a crapshoot. You might get lucky and get a sane reasonable dictator, or you might get a butcher or a lunatic.

    And you can't tell until it's too late. Mussolini gave the impression that he was going to be a sane moderate dictator, and mostly that's what he proved to be. The Italians got lucky with their dice roll. But they had no way of knowing they were going to get lucky until they rolled the dice. The Portuguese got reasonably lucky with Salazar.

    The Germans got unlucky.

    And then there's the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, which managed a series of fairly smooth transitions of power. Whether you're pro-Stalin or anti-Stalin he did create a political system that could handle transitions of power. As did Mao and Kim Il-sung. If you want a dictatorship that will survive long-term you need to figure out why communist regimes were much more stable than right-wing dictatorships. Obviously they knew something that right-wing dictatorships didn't know.

    Replies: @SFG, @Rahan, @Bill

  6. The question is what to we do now?

    A starting point is to realize not of us are as rich we seem to be and therefore we should spend less. Use the difference to buy assets yourself, understanding what assets really are (things with yield, things that throw off earnings) — including focused education.

    Radical savings is an important idea. Boosting earnings and restraining spending to where one is able to save 50% is a great way forward (but not scrimping on having and educating kids and church).

    Ways to save: Eschew brands, don’t hire for what you can do yourself (personal training, house and yard cleaning and maintenance, repairs and home improvements), free entertainment like hikes, max out your earning, fix things and make them last, buy used where possible, even live with others when you can afford not to while you are young.

    If one can save 50% now in good times, one can be ready for what comes in a several ways:

    (1) One have the surplus necessary to become an owner rather than a renter. One can buy that house, and invest in some assets.

    (2) One has a cushion against a reduction in standard of living.

    (3) One can avoid the stress of living on the edge and pursue long-run thinking.

    • Replies: @DanHessinMD
    @DanHessinMD

    I should add, America has gone through inflation before. Our parents and grandparents had to go through it. They didn't stop living, having kids, raising great families, doing productive things, etc.

    All sorts of incredible businesses were made, all sorts of human flourishing happened, even under those circumstances.

    Re-upping this, which was recommended in these comments:

    https://www.amazon.com/Catholic-Guide-Spending-Less-Living/dp/1646800478/ref=sr_1_1?dchild=1&keywords=fatzinger&qid=1623497309&sr=8-1

    Even with headwinds, one can up one's game and succeed, even with a big family. It'll take some grit, hard work and faith, and old fashioned frugality, but it is doable!

    One shouldn't just be black pilled and give up -- a bright future is realistic!

    , @V. K. Ovelund
    @DanHessinMD

    The following comment is for parents now saving for their childrens' college educations. In short, don't do it.

    Let me explain.


    Radical savings is an important idea.
     
    Yes, it is.

    Boosting earnings and restraining spending to where one is able to save 50% is a great way forward (but not scrimping on having and educating kids and church).
     
    I cannot deny that college degrees still pay off remuneratively in the United States if done right, but such degrees grow more and more expensive while the education grows worse and worse. Faculty corruption (dishonest research) is significant and mounting. Many foreign students cheat and an increasing number of domestic students find ways to work the system (such as via a psychiatric diagnosis for ADHD) that net them passing grades for failing performance.

    The sex-drugs-and-rocknroll on campus casually consumes a large number of bright young lives.

    As a class, collegiate faculty are the most tenacious, blithest, most skilled class of liars in the United States. Not congressmen, not used-car salesmen, but collegiate faculty—though the situation is somewhat less egregious in STEM. (Though pseudonymous I wish to clarify that I do not speak of any particular faculty with whom I served, several of whom remain friends of mine and whom I trust, but I have known those a long time. I also know what I am talking about when it comes to U.S. collegiate faculty more generally.)

    I would not send my children to college, nor would I push them to borrow to go. For sons with sufficiently clean disciplinary records, military service is probably less risky on the whole (though there are no guarantees); and if sons later attend college on the G.I. Bill, the money it costs is their money they've earned, so they are more likely to power through college with focus and proper purpose.

    As for daughters, ..., well, how do I say this without being indelicate?

    I cannot say it outright, sorry, but if the solution involves birth control, ... Look, the meat market on campus is bad. Recreational drugs make it worse. By the junior year, many or most coeds are either overweight or shacked up with a male student. I do not believe that sending a daughter to college in the early 21st century in the United States is a good idea. By the time she takes her degree, your college fund will be drained and the college may have persuaded your daughter to hate you. This is not a good idea.

    If you want to help your daughter, then, once she is married and pregnant, buy her a house. I suspect that you will find that to have been a better use of the money.

    Replies: @dfordoom

  7. @DanHessinMD
    The question is what to we do now?

    A starting point is to realize not of us are as rich we seem to be and therefore we should spend less. Use the difference to buy assets yourself, understanding what assets really are (things with yield, things that throw off earnings) -- including focused education.

    Radical savings is an important idea. Boosting earnings and restraining spending to where one is able to save 50% is a great way forward (but not scrimping on having and educating kids and church).

    Ways to save: Eschew brands, don't hire for what you can do yourself (personal training, house and yard cleaning and maintenance, repairs and home improvements), free entertainment like hikes, max out your earning, fix things and make them last, buy used where possible, even live with others when you can afford not to while you are young.

    If one can save 50% now in good times, one can be ready for what comes in a several ways:

    (1) One have the surplus necessary to become an owner rather than a renter. One can buy that house, and invest in some assets.

    (2) One has a cushion against a reduction in standard of living.

    (3) One can avoid the stress of living on the edge and pursue long-run thinking.

    Replies: @DanHessinMD, @V. K. Ovelund

    I should add, America has gone through inflation before. Our parents and grandparents had to go through it. They didn’t stop living, having kids, raising great families, doing productive things, etc.

    All sorts of incredible businesses were made, all sorts of human flourishing happened, even under those circumstances.

    Re-upping this, which was recommended in these comments:

    Even with headwinds, one can up one’s game and succeed, even with a big family. It’ll take some grit, hard work and faith, and old fashioned frugality, but it is doable!

    One shouldn’t just be black pilled and give up — a bright future is realistic!

    • Disagree: Stan d Mute
  8. It is reasonably clear that we are at the beginning of the process of becoming a failed state. We have a lot of “surplus,” and declines are hardly ever straight line events so it may well be a long drawn out affair. My disappointment, other than the realization that this is the beginning of the end, is that I truly cannot “see” any (practical) way to stop or reverse it.

    • Replies: @notanon
    @iffen

    "I truly cannot “see” any (practical) way to stop or reverse it."

    practical or not the solution is conceptually simple...

    1. remove our current corrupt elite (the finance, media and political class) but especially finance as they are the root of the corruption

    2. scrap "free trade" in favor of protectionist trade where nations produce their own stuff

    Replies: @SunBakedSuburb

  9. Looking at how auto manufacturers are able to finance cars ought to show the problem of allowing institutional investors, like Banks or Blackrock, to buy homes in the retail market.

    We see an auto maker offer concessional finance rates ( zero to 1 percent ) to a new car buyer. How can they do this? Well GM, Toyota or VW don’t borrow money from a bank. They can borrow on the capital markets or issue bonds. The car buyer cannot so the ‘cost’ of such concessional financing to the manufacturer is just a few basis points on a $30-40,000 loan Not much different than tossing in a free oil change or two but its a major incentive to a car buyer since he doesn’t have to get a loan from a bank to buy a new car.

    Blackrock and other large institutional investors similarly borrow in a different market than retail buyers or investors. The Fed Funds rate is 0.25%, that is a daily rate, but Blackrock and banks can borrow overnight and you can’t. They have access to Fed money and you don’t so they are paying a far lower interest rate to finance the purchase of the house you wanted to buy without any of the expenses of a conventional mortgage loan.

    Clearly this was not the intent of Fed monetary policy which was to lower interest rates to make it possible for banks and other wholesale lenders to offer cheaper loans to retail buyers not to cut the retail buyer out of the market!

    • Replies: @Daniel H
    @UNIT472


    Clearly this was not the intent of Fed monetary policy which was to lower interest rates to make it possible for banks and other wholesale lenders to offer cheaper loans to retail buyers not to cut the retail buyer out of the market!
     
    I don't know, maybe that has been the intent of the Fed all along. They must know damn well that the low interest rates don't trickle down to the consumer.

    I was irresponsible and profligate. Got myself into a jam. Was paying 18% to JP Morgan on a credit card debt...for years. None of that 1% financing was trickling down to me. Stopped paying last year because I lost the job. Three months ago I smarten'd up a little. Called JP Morgan and said. Let's settle. 30 cents on the dollar (I probably cold have gotten 20, but I'm not a hard line negotiator). They agreed within t seconds of my proposal. Anybody here who has unsecured debt, I urge them to force the creditor to settle for pennies. And with a little motivation, indebted students can form a nationwide union to force the govt. to settle student debt for pennies. People have to take a little initiative.

    Replies: @UNIT472

  10. It’s hard to watch Imperial Washington pulling trillions out of it’s ass to “stimulate” the economy without asking why am I paying taxes? This question is immediately followed by another. Why do I go to work? Ass dollars are as good as earned dollars. Now you are thinking like AOC.

    It will soon be revealed that ass dollars are like everything else that comes out of your ass.

    • Agree: Realist
    • Replies: @anyone with a brain
    @WorkingClass


    Why do I go to work? Ass dollars are as good as earned dollars.
     
    A deeper question is "I am at work, why should I work?"
    So many people have bullshit jobs where they do nothing productive, and so many business are just forms of rent seeking and receiving a form of royalty. Many people who are going to work or workers go and do fucking nothing of value, they are exactly the same, if not worse than someone sitting at home, because someone sitting at home is at least out of the way of commerce. While the zombie workers go out and block potential innovation with their mass and resistance to both work, and loss of their parasite position.

    Point is that these people ought to have the dignity to transform their paid positions into actual work and value or to quit and start a new business or change to a better job. And if they don't they are more worthy of scorn than those who stay at home and explicitly and honestly collect money for doing nothing.

    Replies: @Hermes

    , @MarkU
    @WorkingClass

    Ass dollars, Lol

  11. This can only end extremely well. Looks like that Deagel forecast was right.

    Pepe’s Zone A/Zone B is gonna become an incomprehensible civilizational line. Crossing it will be banned on both sides forever, Albania style.

    • Replies: @V. K. Ovelund
    @Svevlad


    Pepe’s Zone A/Zone B is gonna become an incomprehensible civilizational line.
     
    I do not understand.
  12. @iffen
    It is reasonably clear that we are at the beginning of the process of becoming a failed state. We have a lot of "surplus," and declines are hardly ever straight line events so it may well be a long drawn out affair. My disappointment, other than the realization that this is the beginning of the end, is that I truly cannot "see" any (practical) way to stop or reverse it.

    Replies: @notanon

    “I truly cannot “see” any (practical) way to stop or reverse it.”

    practical or not the solution is conceptually simple…

    1. remove our current corrupt elite (the finance, media and political class) but especially finance as they are the root of the corruption

    2. scrap “free trade” in favor of protectionist trade where nations produce their own stuff

    • Replies: @SunBakedSuburb
    @notanon

    The removal of the "current corrupt elite" while necessary seems an impossible task. They and the leftist authoritarian system they preside over is protected by the civilian intelligence agencies. The military is currently undergoing the purge, the Posse Comitatus Act will be rendered null and void through the machinations of fellow traveler lawyers and judges, and special Army units will be fused with DHS squads to monitor domestic wrongthink. If we're lucky we'll find a rental in a Black Rock ghetto.

    Replies: @dfordoom, @notanon

  13. @Achmed E. Newman
    Man, your financial posts are the best, A.E.! This thing with BlackRock is a big deal not just in and of itself, but, as you say, it's part of a large trend toward this Neo-Feudalism. (I've never written that term before, but yeah.) Was the Kung Flu PanicFest designed to aid and abet this trend?

    BTW, I'm not sure if you have already explained the 2 reasons why the FED cannot raise interest rates:

    1) That will bust the US budget so badly that everyone will see the $ for what it is. ("Your cash ain't nuthin' but trash.") Were it to go up to just 7%, the interest payments on the now-$27,000,000,000,000 would be something around 40% of the Feral Gov't expenditures. It's easy to figure from the pie charts that are still near the back of the IRS 1040 instructions .pdf's.

    2) The stock market will tank, due to people having a non-risky place to get returns from (not real returns, necessarily, after inflation), but at least not losing much of it each year. Since Americans see their houses and their 401-k's as their biggest assets, people would become a lot poorer on paper quickly.

    Replies: @notanon

    Was the Kung Flu PanicFest designed to aid and abet this trend?

    i wouldn’t be surprised

    our corrupt elite’s policies (currency debasement, off-shoring, mass immigration etc) were always going to bring America down eventually and as we got close to the edge of the cliff (with the possibility of a backlash against them) it would be convenient for them if they had:

    a) a scapegoat for the looming economic collapse

    and

    b) an excuse for having a high tech gulag in place beforehand in case people got uppity

    (and if it wasn’t them then at the least I’d say they were taking advantage of the panic for those two reasons).

  14. “..they know what the Fed has in mind–it also knows nominal prices of everything will go up. Prices will increase at accelerating rates. There will be an abundance of dollars and shortages of everything else,”

    Well if they know that, and [more importantly] _you_ know that, _for_ certain_, then presumably you will have no problem “investing” _all_of your own savings/assets into assets that historically do very well during inflationary times [ eg gold].

    I would suggest that if you are not fully prepared to “invest” all of your savings on that “for certain” massively inflationary economic future, then that you are not as certain of that particular future as you appear to be here – or am I missing something?

    Anyhoo, there are other plenty of other [equally believable] arguments out there leaning toward a more deflationary [ ie an increase in purchasing power of the $US] future, for example :

    “Does Crumbling USD Monetary Velocity Guarantee Higher US Stock Markets and Render Hyperinflation Possibilities Void?”
    https://www.zerohedge.com/news/2021-06-11/does-crumbling-usd-monetary-velocity-guarantee-higher-us-stock-markets-and-render

    Not to suggest that that alternative scenario is any more certain and “bound” to happen either – my point is merely that the economic future is, as always, unknowable, and that making huge bets on a “certain” economic future, with gold, crypto, cash,real estate, bonds, stocks, or whatever is, more than likely going to lead the individual to disaster.

    “If it were possible to calculate the future structure of the market, the future would not be uncertain. There would be neither entrepreneurial loss nor profit. What people expect from the economists is beyond the power of any mortal man.” Ludwig Von Mises.

    Regards, onebornfree

    • Thanks: Audacious Epigone
    • Replies: @RoatanBill
    @onebornfree

    Look at the recent run up in prices for most industrial commodities. The exceptions are the precious metals due to a rigged paper market.

    Gold and especially silver are tremendously undervalued (cheap); mining output has been falling for years because it's uneconomic to mine at current prices. Therefore, I conclude that these metals are primed for an increase, especially since the Basel III regulations are coming on line at the end of the month for the EU and at the end of the year for that den of thieves in the City of London, England. Those regs make it uneconomic for the bullion banks to continue to play the paper market. They are going to be asked to have 85% physical for every paper contract they submit. The naked shorts are going away and when that happens, the rigging disappears.

    Specifically for silver, it is an industrial metal needed for solar panels, EV's and many other products and a substitute is not readily available. The 'Wall Street Silver' Reddit group has figured it out and they are pushing for people to take delivery of metal as opposed to cashing out in fiat. Supplies are tight with retail premiums way over the spot market and silver in all forms is near to becoming unobtainium.

    Replies: @onebornfree

  15. Just to add to this – and why it’s good to own income producing residential real estate in general – is that developers cannot keep up with demand for housing and there is no sign this will change anytime soon. On the supply side, you have the fact that there just are not very many cities or towns of any real size that have a quick and efficient process for allowing new development to move through the entitlement process. On the demand side you have the tens of millions of legal and illegal immigrants we have added and will continue to add, and they all need a place to live – the illegals in particular are willing to pay cash and there are a lot of landlords that will happily take that.

    Some years back as the result of an online argument I looked at the annual number of residential building permits issued in CA starting in the 70s and compared it to the population growth attributable to immigration. Builders would have still been somewhat behind demand with zero immigration but it would not have been too much. Instead, population growth far outran housing production for the last 50 years and the result are the crushing real estate prices in a state that up until the 60s was perhaps the closest thing to a middle class paradise this country ever had, or ever will.

    • Replies: @UNIT472
    @Arclight

    California ( and the rest of the West) is a special case where getting a permit to hook up to public water ( and utility ) services looks to be a serious issue going forward. Las Vegas may have been the fastest growing major city in America but its future is seriously clouded by the water level in Lake Mead ( low and falling).

    OTOH demographics, high cost of living and the deteriorating quality of life in California may cause many ageing baby boomers ( who actually own most of the residential real estate) to cash out and go elsewhere. Oldest baby boomers are now 75 and the youngest 57.

    , @RoatanBill
    @Arclight

    Ever heard of the concept of 'rent control'? New York City has had it for decades. There are more renters than landlords. Guess where the votes are.

    When the SHTF, the renters will have the upper hand because there are so many of them. The political class will throw the landlords to the curb for the votes. We already have a current moratorium. It is scheduled to end. My bet is that it will end and then be reinstated because the pols don't want their cities to burn down.

    Real Estate that involves rent is too dangerous for my taste. If you own property in podunkville, and you live in it free of a mortgage, then you're in good shape to weather the storm, but if you own rental property in the cities I think you're toast in the long run. Your taxes will rise, your expenses will rise and the gov't will freeze your ability to increase rents. That's when Blackrock comes to your rescue and buys you out for a song so you can get rid of the headache. Blackrock WILL be able to control rents because they are going to make the market and they own the politicians.

  16. @Arclight
    Just to add to this - and why it's good to own income producing residential real estate in general - is that developers cannot keep up with demand for housing and there is no sign this will change anytime soon. On the supply side, you have the fact that there just are not very many cities or towns of any real size that have a quick and efficient process for allowing new development to move through the entitlement process. On the demand side you have the tens of millions of legal and illegal immigrants we have added and will continue to add, and they all need a place to live - the illegals in particular are willing to pay cash and there are a lot of landlords that will happily take that.

    Some years back as the result of an online argument I looked at the annual number of residential building permits issued in CA starting in the 70s and compared it to the population growth attributable to immigration. Builders would have still been somewhat behind demand with zero immigration but it would not have been too much. Instead, population growth far outran housing production for the last 50 years and the result are the crushing real estate prices in a state that up until the 60s was perhaps the closest thing to a middle class paradise this country ever had, or ever will.

    Replies: @UNIT472, @RoatanBill

    California ( and the rest of the West) is a special case where getting a permit to hook up to public water ( and utility ) services looks to be a serious issue going forward. Las Vegas may have been the fastest growing major city in America but its future is seriously clouded by the water level in Lake Mead ( low and falling).

    OTOH demographics, high cost of living and the deteriorating quality of life in California may cause many ageing baby boomers ( who actually own most of the residential real estate) to cash out and go elsewhere. Oldest baby boomers are now 75 and the youngest 57.

  17. The May inflation report, while still high, came in lower than the April report.

    While there are some fears of inflation in the bond market, the rush into real estate by major asset managers can instead be interpreted as being caused by low rates. A hunt for yield rather than a flight to hard assets per se.

    No one is very happy with the housing market right now, but the current environment is caused by an unusually low supply of homes for sales rather than the greater fool theory that dominated the Bush era.

    https://www.cnbc.com/2021/03/05/spring-housing-market-just-lost-more-than-200000-new-listings.html

    Low rates increase the net present value of assets, so all else equal higher rates will of course put a damper on housing prices. The FED has indicated that they will begin to taper towards the end of this year if conditions continue to improve, but it should be noted that this occurs against a background of the lowest real rates of all time. The author of this blog and many comments also greatly exaggerate the power of the FED (and other central banks) to impact both interest rates and inflation. Central banks have little control over long-term rates, and the not only the FED but also the ECB and BoJ have persistently undershot their inflation targets and forecasts for over a decade (multiple decades in the case of BoJ). Structural-demographic trends are more powerful that the discount window.

    Depending on how aggressive the FED tapers (spoiler: likely not very), FED action might take the wind out of the sails of the growing army of “all-cash” buyers. Most all cash buyers are in fact borrowing against the value of other assets. For instance, if you have a portfolio with Interactive Brokers you can borrow at rates as low as 0.75% (even lower in some foreign currencies), and all without the expensive and time consuming procedure of getting a mortgage. See IB’s rates here: https://www.interactivebrokers.com/en/accounts/fees/pricing-margin-rates.php

    The frugal personal finance blogger Mr. Money Mustache recently did an all-cash real estate transaction using this method: https://www.mrmoneymustache.com/2021/01/29/margin-loan-ibkr-review/

    Higher rates will make such borrowing more expensive, and they will also increase the attractiveness of money market funds and bonds. Long-term rates are unlikely to increase as much in response to tightening, so traditional home buyers relying on 30-year mortgages could benefit.

    But ultimately the real thing the housing market requires is more homes for sale. This should happen on its own as reopening continues, though the long-term trend of NIMBYism will remain a serious menace.

  18. @WorkingClass
    It's hard to watch Imperial Washington pulling trillions out of it's ass to "stimulate" the economy without asking why am I paying taxes? This question is immediately followed by another. Why do I go to work? Ass dollars are as good as earned dollars. Now you are thinking like AOC.

    It will soon be revealed that ass dollars are like everything else that comes out of your ass.

    Replies: @anyone with a brain, @MarkU

    Why do I go to work? Ass dollars are as good as earned dollars.

    A deeper question is “I am at work, why should I work?”
    So many people have bullshit jobs where they do nothing productive, and so many business are just forms of rent seeking and receiving a form of royalty. Many people who are going to work or workers go and do fucking nothing of value, they are exactly the same, if not worse than someone sitting at home, because someone sitting at home is at least out of the way of commerce. While the zombie workers go out and block potential innovation with their mass and resistance to both work, and loss of their parasite position.

    Point is that these people ought to have the dignity to transform their paid positions into actual work and value or to quit and start a new business or change to a better job. And if they don’t they are more worthy of scorn than those who stay at home and explicitly and honestly collect money for doing nothing.

    • Agree: Hermes, Stan d Mute
    • Replies: @Hermes
    @anyone with a brain

    I think a large proportion of the office jobs that have been created since the 1960s are basically make-work affirmative action jobs for women and NAMs. Look at the explosion in the size of HR departments. This is also probably an overlooked factor in the proliferation of college administrators.

    These jobs create or produce nothing. We put men on the moon without multi-thousand-employee HR departments.

  19. If the Fed had any intention of raising rates, BlackRock wouldn’t be paying 30% above asking for houses.

    Yes, I smell a rat.

    The book on BlackRock has (literally, as far as I can see) not been written yet. When it has, I mean to buy and read it.

    Whether BlackRock is a principal player or not, I suspect that the U.S. Treasury is being looted. Esoteric mechanisms appear to exist, like the U.S. Exchange Stabilization Fund, to move tens or even hundreds of billions of dollars in newly-printed cash, quickly, to various places for various ostensible purposes. That the public (including me) does not yet grasp the details is obvious. The public’s lack of grasp of details seems likely to afford scoundrels an untoward opportunity to profit.

    However, some right-of-center online commenters (though maybe less so here in this blog) shoot from the hip at such topics, so to speak. I’d like to get my facts right, first, so I can shoot straight.

    Does any reader know of a good analysis of the topic by a knowledgeable, thorough writer? Ellen Brown’s article is still the best I’ve seen, but after following her various hyperlinks I still seek an even better article or report. I want to know who is looting the Treasury and how: the more detail, the better. Alternately, if no one is looting the Treasury, then I would like a clear explanation of what is going on.

    • Replies: @Audacious Epigone
    @V. K. Ovelund

    Looting the treasury insinuates there is physical treasure there to loot.

    Replies: @V. K. Ovelund

    , @Ralph B. Seymour
    @V. K. Ovelund

    I think the Central Bank's plan is to buy up every hard asset available. And when the dollar fails because of the printing, it will come to the rescue with CBDC.

    This is a major pillar of the Great Reset, or the New Feudalism.

    And presto, we're all slaves.

  20. @Svevlad
    This can only end extremely well. Looks like that Deagel forecast was right.

    Pepe's Zone A/Zone B is gonna become an incomprehensible civilizational line. Crossing it will be banned on both sides forever, Albania style.

    Replies: @V. K. Ovelund

    Pepe’s Zone A/Zone B is gonna become an incomprehensible civilizational line.

    I do not understand.

  21. TG says:

    Indeed, I agree, but like so many economists you are forgetting one important factor: physical reality.

    The rich have basically opened the border, and countless millions of third-world refugees are streaming across the border to be permanently resettled here – and all of them will need housing and roads and food and fresh water etc. Meanwhile our industrial base has been shipped to China, and despite occasional murmurs from Washington nothing is being done to bring any of that back. We continue to waste a trillion dollars a year on mindless overseas adventures, starving the domestic economy of investment. And parasitic finance – stock buybacks, the student loan scam, tens of trillions of dollars in taxpayer bailouts of Wall Street – also steers investments away from the real economy.

    Bottom line: more and more people, and stagnant real productive capacity. One way or the other, wages will fall relative to prices. Right now prices are going up and wages are stagnant. If the government stopped printing money, perhaps they could stabilize prices – but then wages would collapse, to keep the balance. Or maybe massive tax increases on the middle class will keep spending down and in line what what we can really produce – nominally wages will be high and prices low, but real spendable wages will be low. One way or the other, you can’t consume what doesn’t exist.

    So yes, printing money like crazy is nuts, agreed. But never forget the real world, and supply and demand.

    • Agree: Audacious Epigone
    • Replies: @notanon
    @TG


    So yes, printing money like crazy is nuts, agreed. But never forget the real world, and supply and demand.
     
    true but also never forget the people printing the money are the people who opened the borders and off-shored the industry.

    Replies: @TG

    , @RoatanBill
    @TG

    I heard that China just instituted price controls. That could just be MSM bullshit, but price controls are definitely in the US's future. It's one of the signs of an impending social explosion as price controls always result in scarcity.

    Replies: @anon

  22. @DanHessinMD
    The question is what to we do now?

    A starting point is to realize not of us are as rich we seem to be and therefore we should spend less. Use the difference to buy assets yourself, understanding what assets really are (things with yield, things that throw off earnings) -- including focused education.

    Radical savings is an important idea. Boosting earnings and restraining spending to where one is able to save 50% is a great way forward (but not scrimping on having and educating kids and church).

    Ways to save: Eschew brands, don't hire for what you can do yourself (personal training, house and yard cleaning and maintenance, repairs and home improvements), free entertainment like hikes, max out your earning, fix things and make them last, buy used where possible, even live with others when you can afford not to while you are young.

    If one can save 50% now in good times, one can be ready for what comes in a several ways:

    (1) One have the surplus necessary to become an owner rather than a renter. One can buy that house, and invest in some assets.

    (2) One has a cushion against a reduction in standard of living.

    (3) One can avoid the stress of living on the edge and pursue long-run thinking.

    Replies: @DanHessinMD, @V. K. Ovelund

    The following comment is for parents now saving for their childrens’ college educations. In short, don’t do it.

    Let me explain.

    Radical savings is an important idea.

    Yes, it is.

    Boosting earnings and restraining spending to where one is able to save 50% is a great way forward (but not scrimping on having and educating kids and church).

    I cannot deny that college degrees still pay off remuneratively in the United States if done right, but such degrees grow more and more expensive while the education grows worse and worse. Faculty corruption (dishonest research) is significant and mounting. Many foreign students cheat and an increasing number of domestic students find ways to work the system (such as via a psychiatric diagnosis for ADHD) that net them passing grades for failing performance.

    The sex-drugs-and-rocknroll on campus casually consumes a large number of bright young lives.

    [MORE]

    As a class, collegiate faculty are the most tenacious, blithest, most skilled class of liars in the United States. Not congressmen, not used-car salesmen, but collegiate faculty—though the situation is somewhat less egregious in STEM. (Though pseudonymous I wish to clarify that I do not speak of any particular faculty with whom I served, several of whom remain friends of mine and whom I trust, but I have known those a long time. I also know what I am talking about when it comes to U.S. collegiate faculty more generally.)

    I would not send my children to college, nor would I push them to borrow to go. For sons with sufficiently clean disciplinary records, military service is probably less risky on the whole (though there are no guarantees); and if sons later attend college on the G.I. Bill, the money it costs is their money they’ve earned, so they are more likely to power through college with focus and proper purpose.

    As for daughters, …, well, how do I say this without being indelicate?

    I cannot say it outright, sorry, but if the solution involves birth control, … Look, the meat market on campus is bad. Recreational drugs make it worse. By the junior year, many or most coeds are either overweight or shacked up with a male student. I do not believe that sending a daughter to college in the early 21st century in the United States is a good idea. By the time she takes her degree, your college fund will be drained and the college may have persuaded your daughter to hate you. This is not a good idea.

    If you want to help your daughter, then, once she is married and pregnant, buy her a house. I suspect that you will find that to have been a better use of the money.

    • Replies: @dfordoom
    @V. K. Ovelund


    The following comment is for parents now saving for their childrens’ college educations. In short, don’t do it.
     
    I agree.

    I do not believe that sending a daughter to college in the early 21st century in the United States is a good idea. By the time she takes her degree, your college fund will be drained and the college may have persuaded your daughter to hate you. This is not a good idea.

     

    I agree very strongly.

    I think @DanHessinMD makes some very good points about saving, and about not spending money on stuff you don't need. A new car might be tempting, but you don't need a new car. It's much better to buy a decent used car without borrowing rather than getting into debt to buy that shiny new car. It's much better to buy the consumer goods that you actually need and that you can afford to buy without borrowing.

    Even with very low interest rates and easy credit getting into debt is a bad idea. It's a bad idea financially and it's a bad idea morally. It encourages destructive short-term thinking and it inverts people's values. Easy credit is decadence.
  23. @WorkingClass
    It's hard to watch Imperial Washington pulling trillions out of it's ass to "stimulate" the economy without asking why am I paying taxes? This question is immediately followed by another. Why do I go to work? Ass dollars are as good as earned dollars. Now you are thinking like AOC.

    It will soon be revealed that ass dollars are like everything else that comes out of your ass.

    Replies: @anyone with a brain, @MarkU

    Ass dollars, Lol

  24. Buying off grid solar trailers with their own water systems in rural areas, replete with gardening, could really mess all this up. If only people would in sufficient numbers. It would be a beautiful disaster for the hedgies. Aint gonna happen though

  25. @TG
    Indeed, I agree, but like so many economists you are forgetting one important factor: physical reality.

    The rich have basically opened the border, and countless millions of third-world refugees are streaming across the border to be permanently resettled here - and all of them will need housing and roads and food and fresh water etc. Meanwhile our industrial base has been shipped to China, and despite occasional murmurs from Washington nothing is being done to bring any of that back. We continue to waste a trillion dollars a year on mindless overseas adventures, starving the domestic economy of investment. And parasitic finance - stock buybacks, the student loan scam, tens of trillions of dollars in taxpayer bailouts of Wall Street - also steers investments away from the real economy.

    Bottom line: more and more people, and stagnant real productive capacity. One way or the other, wages will fall relative to prices. Right now prices are going up and wages are stagnant. If the government stopped printing money, perhaps they could stabilize prices - but then wages would collapse, to keep the balance. Or maybe massive tax increases on the middle class will keep spending down and in line what what we can really produce - nominally wages will be high and prices low, but real spendable wages will be low. One way or the other, you can't consume what doesn't exist.

    So yes, printing money like crazy is nuts, agreed. But never forget the real world, and supply and demand.

    Replies: @notanon, @RoatanBill

    So yes, printing money like crazy is nuts, agreed. But never forget the real world, and supply and demand.

    true but also never forget the people printing the money are the people who opened the borders and off-shored the industry.

    • Replies: @TG
    @notanon

    Absolutely correct: we should never forget that.

    All part of the plan. Pity we're not included.

  26. @notanon
    @iffen

    "I truly cannot “see” any (practical) way to stop or reverse it."

    practical or not the solution is conceptually simple...

    1. remove our current corrupt elite (the finance, media and political class) but especially finance as they are the root of the corruption

    2. scrap "free trade" in favor of protectionist trade where nations produce their own stuff

    Replies: @SunBakedSuburb

    The removal of the “current corrupt elite” while necessary seems an impossible task. They and the leftist authoritarian system they preside over is protected by the civilian intelligence agencies. The military is currently undergoing the purge, the Posse Comitatus Act will be rendered null and void through the machinations of fellow traveler lawyers and judges, and special Army units will be fused with DHS squads to monitor domestic wrongthink. If we’re lucky we’ll find a rental in a Black Rock ghetto.

    • Replies: @dfordoom
    @SunBakedSuburb


    The removal of the “current corrupt elite” while necessary seems an impossible task. They and the leftist authoritarian system they preside over is protected by the civilian intelligence agencies.
     
    I mostly agree, although I'd say that the current system is not a leftist authoritarian system. It's just an authoritarian system. There's no genuine ideological basis to it. It's about naked power and it's about corruption, and it's about powerful corrupt people protecting their own interests.

    The ideological aspect to it is fake. It's window dressing. To the extent that there's any genuine ideological element to it the ideology is more fascist than leftist. Or perhaps it really is neo-feudalism.

    But you're correct in stating that the current system is protected by the civilian intelligence agencies and the military and they're not going to allow it to be overthrown. They will do whatever they think necessary to preserve the system, and they will be utterly ruthless about it.

    Replies: @SunBakedSuburb

    , @notanon
    @SunBakedSuburb


    The removal of the “current corrupt elite” while necessary seems an impossible task.
     
    maybe; maybe not

    imo although the people actually driving this have managed to stealth their way to the top of the chain of command i don't think there's a lot of them numerically (and the bulk of their minions are self-centered sociopaths, effectively mercenaries who'd change sides in an instant if the tide looked like it might be turning)

    so very difficult yes but maybe not impossible.

    Replies: @SunBakedSuburb, @V. K. Ovelund

  27. @Twinkie
    @Mark G.


    If we want to avoid ending up having a dictator in this country
     
    Let us have a Franco and be done with it.

    I am henceforth a Franquist (or Francoist). It even sounds vaguely Hispanic. And Asians will support anything that restores school quality.

    Replies: @dfordoom

    Let us have a Franco and be done with it.

    The problem with getting a dictator is that it’s a crapshoot. You might get lucky and get a sane reasonable dictator, or you might get a butcher or a lunatic.

    And you can’t tell until it’s too late. Mussolini gave the impression that he was going to be a sane moderate dictator, and mostly that’s what he proved to be. The Italians got lucky with their dice roll. But they had no way of knowing they were going to get lucky until they rolled the dice. The Portuguese got reasonably lucky with Salazar.

    The Germans got unlucky.

    And then there’s the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, which managed a series of fairly smooth transitions of power. Whether you’re pro-Stalin or anti-Stalin he did create a political system that could handle transitions of power. As did Mao and Kim Il-sung. If you want a dictatorship that will survive long-term you need to figure out why communist regimes were much more stable than right-wing dictatorships. Obviously they knew something that right-wing dictatorships didn’t know.

    • Replies: @SFG
    @dfordoom

    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.

    I'd say the advantage of communist regimes is that they have something the right no longer has tied into government--religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class. It has a devil (international capitalism), and liturgy (Mao's red book) and saints (Marx, Engels, Lenin, Mao). Right-wing military regimes tend not to have that, though premodern monarchies did.

    Replies: @dfordoom, @Pericles

    , @Rahan
    @dfordoom

    I've long thought that Lukashenko is to modern Belarus what Salazar was to Portugal.
    A crude provincial stabilizing force in a time of chaos.

    , @Bill
    @dfordoom

    Perhaps they knew that being a US ally is a really bad idea?

    Replies: @dfordoom

  28. This has been going on for a long time. The great recession was never “fixed”. There was still a glut of cash on the sidelines after the meltdown in ‘08. It flooded into healthier markets starting in 2010.

    Above asking syndicated buyers could get 6% cash on cash day one because the rental markets were hot with displaced former “owners” and the tightened underwriting constraining new buyers. All cash, above ask was the “new normal” quite quickly out of the worst recession ever lol.

    Distressed debt, aggregating residential RE; converting high density condos into rentals; converting bad mortgage paper into equity positions; funding opportunistic local and regional RE investors in fix n flip and fix n rent strategies; b-piece and busted MBS traunches; illiquid paper lots and raw land; all of it was in the crosshairs of institutionally backed investors and private equity alike. Part necessity and part “free market” opportunism that came out of the last full retard session which was just shell-gamed into equities.

    As for that free market. Meanwhile the same grease of zirp and printer brr that fuels the big boys gave everyone else the ability to overpay for their mcmansion or townhome or two.

    Soon every hot market was flooded with flippers and STRs and private portfolio builders. New real estate empires sprouting like shrooms atop the big turd.

    So many super smart and super hustlers and hairdo dolts collecting massive realtor fees. Nobody thought that was the end of the world or that it could possibly have downstream consequences. Goldfish memories go hand in hand with easy money.

    Air bnb, flipping, additional units above the garage, basement apartments; boomer parents buying second and third units for their social media marketing millennial daughter so she could live in the safe, up and coming, part of town . everybody was in on the monetization once again. Fingers in pies. Getting theirs. All of this was already pricing out new buyers, young families, working class long before people had heard of Blackrock.

    Ive no love for the institutions or the rigged game but pricing the proles out of the market has been a thing for a long time and its not just the big boys playing musical chairs.

    Long ago we decided love of money was more important than community or posterity or continuity of a people. Get in, get yours, get out.

    There are old folks chopping up farms asking $30k/acre for dirt that was $3k a few years ago. Nobody is leaving a penny on the table when it comes to their gravy from the inflation boat. Keeping their idyllic community intact or providing a future for their people is way down the list if even contemplated. But know that the big boys are outbidding them its a huge problem. Huh.

    The institutions may know something we dont vis a vis the inflation bet. But then again you have to follow the risk. As in who actually owns it. Last time around it was engineered into dark corners. Private profit, public risk is still the way.

    In the meantime I am looking to buy some red county land for my family to rejoin civilization. Like everybody else apparently. For all smarter than I, the great migration is a chance to pick your neighbors, invest in a shared future.

    Or make your hay and sunset on the beach. This proposition is not a new one. Holding institutions to a standard that is just a scaled-up version of the same value system shared by most individuals is just getting to be tedious.

    • Agree: V. K. Ovelund
  29. @V. K. Ovelund
    @DanHessinMD

    The following comment is for parents now saving for their childrens' college educations. In short, don't do it.

    Let me explain.


    Radical savings is an important idea.
     
    Yes, it is.

    Boosting earnings and restraining spending to where one is able to save 50% is a great way forward (but not scrimping on having and educating kids and church).
     
    I cannot deny that college degrees still pay off remuneratively in the United States if done right, but such degrees grow more and more expensive while the education grows worse and worse. Faculty corruption (dishonest research) is significant and mounting. Many foreign students cheat and an increasing number of domestic students find ways to work the system (such as via a psychiatric diagnosis for ADHD) that net them passing grades for failing performance.

    The sex-drugs-and-rocknroll on campus casually consumes a large number of bright young lives.

    As a class, collegiate faculty are the most tenacious, blithest, most skilled class of liars in the United States. Not congressmen, not used-car salesmen, but collegiate faculty—though the situation is somewhat less egregious in STEM. (Though pseudonymous I wish to clarify that I do not speak of any particular faculty with whom I served, several of whom remain friends of mine and whom I trust, but I have known those a long time. I also know what I am talking about when it comes to U.S. collegiate faculty more generally.)

    I would not send my children to college, nor would I push them to borrow to go. For sons with sufficiently clean disciplinary records, military service is probably less risky on the whole (though there are no guarantees); and if sons later attend college on the G.I. Bill, the money it costs is their money they've earned, so they are more likely to power through college with focus and proper purpose.

    As for daughters, ..., well, how do I say this without being indelicate?

    I cannot say it outright, sorry, but if the solution involves birth control, ... Look, the meat market on campus is bad. Recreational drugs make it worse. By the junior year, many or most coeds are either overweight or shacked up with a male student. I do not believe that sending a daughter to college in the early 21st century in the United States is a good idea. By the time she takes her degree, your college fund will be drained and the college may have persuaded your daughter to hate you. This is not a good idea.

    If you want to help your daughter, then, once she is married and pregnant, buy her a house. I suspect that you will find that to have been a better use of the money.

    Replies: @dfordoom

    The following comment is for parents now saving for their childrens’ college educations. In short, don’t do it.

    I agree.

    I do not believe that sending a daughter to college in the early 21st century in the United States is a good idea. By the time she takes her degree, your college fund will be drained and the college may have persuaded your daughter to hate you. This is not a good idea.

    I agree very strongly.

    I think makes some very good points about saving, and about not spending money on stuff you don’t need. A new car might be tempting, but you don’t need a new car. It’s much better to buy a decent used car without borrowing rather than getting into debt to buy that shiny new car. It’s much better to buy the consumer goods that you actually need and that you can afford to buy without borrowing.

    Even with very low interest rates and easy credit getting into debt is a bad idea. It’s a bad idea financially and it’s a bad idea morally. It encourages destructive short-term thinking and it inverts people’s values. Easy credit is decadence.

    • Agree: Mark G.
  30. @SunBakedSuburb
    @notanon

    The removal of the "current corrupt elite" while necessary seems an impossible task. They and the leftist authoritarian system they preside over is protected by the civilian intelligence agencies. The military is currently undergoing the purge, the Posse Comitatus Act will be rendered null and void through the machinations of fellow traveler lawyers and judges, and special Army units will be fused with DHS squads to monitor domestic wrongthink. If we're lucky we'll find a rental in a Black Rock ghetto.

    Replies: @dfordoom, @notanon

    The removal of the “current corrupt elite” while necessary seems an impossible task. They and the leftist authoritarian system they preside over is protected by the civilian intelligence agencies.

    I mostly agree, although I’d say that the current system is not a leftist authoritarian system. It’s just an authoritarian system. There’s no genuine ideological basis to it. It’s about naked power and it’s about corruption, and it’s about powerful corrupt people protecting their own interests.

    The ideological aspect to it is fake. It’s window dressing. To the extent that there’s any genuine ideological element to it the ideology is more fascist than leftist. Or perhaps it really is neo-feudalism.

    But you’re correct in stating that the current system is protected by the civilian intelligence agencies and the military and they’re not going to allow it to be overthrown. They will do whatever they think necessary to preserve the system, and they will be utterly ruthless about it.

    • Replies: @SunBakedSuburb
    @dfordoom

    "neo-feudalism"

    Yes, definitely a more accurate term. Tyranny wears many masks; this one hides behind progressive causes -- climate change, transhumanism -- elites favor.

  31. The Federal Reserve Bank Is An Organized Crime Syndicate

    Jay Powell Is The Frontman For The Financial Factions That Own And Control The Federal Reserve Bank

    BlackRock Is An Organized Crime Syndicate

    Larry Fink Is The Controller Of The Organized Crime Syndicate Called BlackRock

    When Larry Fink And Jay Powell Collude And Conspire Together It Is Sure To Be Harmful To Americans And The USA

    The Powellites and The Finkleyites Must Be Met On The Field Of Political Debate And They Must be VANQUISHED!

    GOD BLESS THE USA!

    I wrote this sentence in August of 2020:

    This Fed Chairman guy Jerome Powell is in bed with BLACKROCK big time.

    https://www.unz.com/anepigone/partition-illinois/#comment-4118779

    Tweet from 2020:

  32. @SunBakedSuburb
    @notanon

    The removal of the "current corrupt elite" while necessary seems an impossible task. They and the leftist authoritarian system they preside over is protected by the civilian intelligence agencies. The military is currently undergoing the purge, the Posse Comitatus Act will be rendered null and void through the machinations of fellow traveler lawyers and judges, and special Army units will be fused with DHS squads to monitor domestic wrongthink. If we're lucky we'll find a rental in a Black Rock ghetto.

    Replies: @dfordoom, @notanon

    The removal of the “current corrupt elite” while necessary seems an impossible task.

    maybe; maybe not

    imo although the people actually driving this have managed to stealth their way to the top of the chain of command i don’t think there’s a lot of them numerically (and the bulk of their minions are self-centered sociopaths, effectively mercenaries who’d change sides in an instant if the tide looked like it might be turning)

    so very difficult yes but maybe not impossible.

    • Replies: @SunBakedSuburb
    @notanon

    "I don't think there's a lot of them numerically"

    This is probably true in the military. The FBI/DOJ and CIA is another kettle of fish.

    , @V. K. Ovelund
    @notanon

    (The nonstandard capitalization is distracting.)


    imo although the people actually driving this have managed to stealth their way to the top of the chain of command i don’t think there’s a lot of them numerically (and the bulk of their minions are self-centered sociopaths, effectively mercenaries who’d change sides in an instant if the tide looked like it might be turning)
     
    You write as though you had served. My own service was decades ago (though I've a son in uniform now), yet my impression mirrors yours precisely.

    The best officers often could not get promoted past O-5: lt. colonel or naval commander. If they were really excellent and luck was with them, they might make O-6: colonel or naval captain. Apparently, political considerations tended to bar further progress for honest men—not always, but oftener than one would like.

    I was only an enlisted trooper, though. (My enlistment paid for college rather than the other way around.) Were you an officer?

    Replies: @notanon

  33. Jewish guy brings up Spaniard Mestizo type guy to talk about how a Jew guy named Larry Fink and the JEW/WASP Ruling Class of the American Empire is using monetary policy extremism and plutocrat plots to pauperize not just Whites, but EVERYONE of all races in the USA! The EVERYONE is said like Gary Oldman said it in that movie with Jean Reno(Spaniard) and Portman(Jew).

    It’s a phucking Sidney Lumet movie fer chrisakes!

  34. SFG says:
    @dfordoom
    @Twinkie


    Let us have a Franco and be done with it.
     
    The problem with getting a dictator is that it's a crapshoot. You might get lucky and get a sane reasonable dictator, or you might get a butcher or a lunatic.

    And you can't tell until it's too late. Mussolini gave the impression that he was going to be a sane moderate dictator, and mostly that's what he proved to be. The Italians got lucky with their dice roll. But they had no way of knowing they were going to get lucky until they rolled the dice. The Portuguese got reasonably lucky with Salazar.

    The Germans got unlucky.

    And then there's the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, which managed a series of fairly smooth transitions of power. Whether you're pro-Stalin or anti-Stalin he did create a political system that could handle transitions of power. As did Mao and Kim Il-sung. If you want a dictatorship that will survive long-term you need to figure out why communist regimes were much more stable than right-wing dictatorships. Obviously they knew something that right-wing dictatorships didn't know.

    Replies: @SFG, @Rahan, @Bill

    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.

    I’d say the advantage of communist regimes is that they have something the right no longer has tied into government–religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class. It has a devil (international capitalism), and liturgy (Mao’s red book) and saints (Marx, Engels, Lenin, Mao). Right-wing military regimes tend not to have that, though premodern monarchies did.

    • Replies: @dfordoom
    @SFG


    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.
     
    Yep. The dissident right is heavily driven by wishful thinking.

    I’d say the advantage of communist regimes is that they have something the right no longer has tied into government–religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class.
     
    Sort of, although some right-wing dictatorships have a definite quasi-religious aspect. The Nazis being the obvious example. And Franco's regime was explicitly Catholic.

    Maybe the difference is that right-wing dictatorships are very emotional and too religious. They're like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics. They have an absorbing interest in creating lasting political structures. The Chinese Communist Party isn't communist any more but the Party still functions smoothly and efficiently.

    Ironically communists (in power) are less ideological than right-wing regimes. They have the patience and the discipline to knuckle down and get things done. Stalin thought that all that starry-eyed idealism was all very well but what the Soviet Union needed was a strong industrial base, and a bureaucracy to actually run things. And a Party structure to maintain continuity and stability.

    Compared to Franco or Hitler Stalin was very much a pragmatist. Mao was an idealist but he still understood that China needed to industrialise. Deng had no interest at all in idealism. Deng was interested in things that actually work.

    And communists are better at long-term thinking, and they're interested in the future. Khrushchev and Deng were looking fifty years ahead. Franco was looking a hundred years in the past. Hitler was stuck in the Middle Ages.

    For right-wing dictatorships the future is envisaged as a recreation of the past. For liberal democracies the long term is what things will be like when the next election comes around. For communists the long term is what things will be like in fifty years.

    Replies: @anon, @Pericles

    , @Pericles
    @SFG

    You already have unreined power detached from responsibility, not really a better situation.

  35. @dfordoom
    @Twinkie


    Let us have a Franco and be done with it.
     
    The problem with getting a dictator is that it's a crapshoot. You might get lucky and get a sane reasonable dictator, or you might get a butcher or a lunatic.

    And you can't tell until it's too late. Mussolini gave the impression that he was going to be a sane moderate dictator, and mostly that's what he proved to be. The Italians got lucky with their dice roll. But they had no way of knowing they were going to get lucky until they rolled the dice. The Portuguese got reasonably lucky with Salazar.

    The Germans got unlucky.

    And then there's the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, which managed a series of fairly smooth transitions of power. Whether you're pro-Stalin or anti-Stalin he did create a political system that could handle transitions of power. As did Mao and Kim Il-sung. If you want a dictatorship that will survive long-term you need to figure out why communist regimes were much more stable than right-wing dictatorships. Obviously they knew something that right-wing dictatorships didn't know.

    Replies: @SFG, @Rahan, @Bill

    I’ve long thought that Lukashenko is to modern Belarus what Salazar was to Portugal.
    A crude provincial stabilizing force in a time of chaos.

  36. anon[305] • Disclaimer says:
    @Triteleia Laxa
    If BlackRock are doing this to make money, they are mistaken. It is a big risk in the short run that interest rates go up and the property market crashes. You argue that, on some level, they know otherwise. I doubt it, even if they are gambling that way, but fine.

    The real problem, though, is that house prices are greatly determined by local supply; and local supply is extremely restricted. The more local voters who are owners, the greater the NIMBY vote.

    If BlackRock buys up entire neighbourhoods, BlackRock still gets zero votes. The renters within those houses get a lot of votes. The political incentives to allow more housebuilding become huge and houses get much cheaper.

    BlackRock just manage too much money and asset prices are stupidly high so they don't know what to do.

    Replies: @anon, @Robert Dolan, @Athletic and Whitesplosive

    If BlackRock are doing this to make money, they are mistaken.

    Could be. Or it could be that Black Rock’s team knows more about this than you do. Which strikes you as more likely?

    The real problem, though, is that house prices are greatly determined by local supply; and local supply is extremely restricted

    That varies across markets depending on both the available land and zoning regulations. There’s a lot of push to revise US zoning laws now, too, and “infill housing” has been a thing for over 20 years.

    Residential RE is a different market from commercial RE, and in both cases there is a physical object that can generate cash flow.

    • Replies: @Triteleia Laxa
    @anon

    They know more than I do, but their problem, of trillions to invest, requires, at the margins, improbable solutions.

  37. This article is from 2017, and is mainly concerned with equities and debt.

    https://financialpost.com/investing/a-20-trillion-blackrock-vanguard-duopoly-is-investings-future

  38. @notanon
    @TG


    So yes, printing money like crazy is nuts, agreed. But never forget the real world, and supply and demand.
     
    true but also never forget the people printing the money are the people who opened the borders and off-shored the industry.

    Replies: @TG

    Absolutely correct: we should never forget that.

    All part of the plan. Pity we’re not included.

    • Agree: notanon
  39. @onebornfree
    "..they know what the Fed has in mind–it also knows nominal prices of everything will go up. Prices will increase at accelerating rates. There will be an abundance of dollars and shortages of everything else,"

    Well if they know that, and [more importantly] _you_ know that, _for_ certain_, then presumably you will have no problem "investing" _all_of your own savings/assets into assets that historically do very well during inflationary times [ eg gold].

    I would suggest that if you are not fully prepared to "invest" all of your savings on that "for certain" massively inflationary economic future, then that you are not as certain of that particular future as you appear to be here - or am I missing something?

    Anyhoo, there are other plenty of other [equally believable] arguments out there leaning toward a more deflationary [ ie an increase in purchasing power of the $US] future, for example :

    "Does Crumbling USD Monetary Velocity Guarantee Higher US Stock Markets and Render Hyperinflation Possibilities Void?"
    https://www.zerohedge.com/news/2021-06-11/does-crumbling-usd-monetary-velocity-guarantee-higher-us-stock-markets-and-render

    Not to suggest that that alternative scenario is any more certain and "bound" to happen either - my point is merely that the economic future is, as always, unknowable, and that making huge bets on a "certain" economic future, with gold, crypto, cash,real estate, bonds, stocks, or whatever is, more than likely going to lead the individual to disaster.

    "If it were possible to calculate the future structure of the market, the future would not be uncertain. There would be neither entrepreneurial loss nor profit. What people expect from the economists is beyond the power of any mortal man." Ludwig Von Mises.

    Regards, onebornfree

    Replies: @RoatanBill

    Look at the recent run up in prices for most industrial commodities. The exceptions are the precious metals due to a rigged paper market.

    Gold and especially silver are tremendously undervalued (cheap); mining output has been falling for years because it’s uneconomic to mine at current prices. Therefore, I conclude that these metals are primed for an increase, especially since the Basel III regulations are coming on line at the end of the month for the EU and at the end of the year for that den of thieves in the City of London, England. Those regs make it uneconomic for the bullion banks to continue to play the paper market. They are going to be asked to have 85% physical for every paper contract they submit. The naked shorts are going away and when that happens, the rigging disappears.

    Specifically for silver, it is an industrial metal needed for solar panels, EV’s and many other products and a substitute is not readily available. The ‘Wall Street Silver’ Reddit group has figured it out and they are pushing for people to take delivery of metal as opposed to cashing out in fiat. Supplies are tight with retail premiums way over the spot market and silver in all forms is near to becoming unobtainium.

    • Replies: @onebornfree
    @RoatanBill

    As a former hard-core gold-bug [80's through early 90's] , I understand where you are coming from, and I could probably take a similar position on precious metals if I didn't watch myself. 😎

    It was hard for me to learn 2 vital real world lessons concerning hard money investments and economics :

    1] [This was hard pill for me to swallow] : Increases in the money supply [ie central bank monetary inflation] will _not_ definitely cause almost instantaneous wide spread rapid inflation [defined as a general loss of purchasing power of the currency unit, the $US], in the market place. [There are fundamental , underlying reasons for this that I won't get into here]. Many "gold-bugs", Austrian economists, libertarians, anarchists and related continue to suffer under that particular delusion [ ie that increases in the money supply will always cause almost immediate, significant loss of purchasing power for the $US ]

    2] More importantly in the big picture [which directly relates to point [1] above], is that "Economics Is NOT a Science":
    http://onebornfreesfinancialsafetyreports.blogspot.com/2013/11/bill-bonner-repeat-after-me-economics.html

    Also see: "Is Gold Under Or Overvalued?" http://onebornfreesfinancialsafetyreports.blogspot.com/2013/07/is-gold-under-or-overvalued.html

    and: "Gerald Celente-The Strange Contradictions of a Fortune-Telling Gold Bug":
    http://onebornfreesfinancialsafetyreports.blogspot.com/2012/01/

    I wish you luck with your gold and silver speculations.

    Regards, onebornfree

    Replies: @RoatanBill

  40. @Arclight
    Just to add to this - and why it's good to own income producing residential real estate in general - is that developers cannot keep up with demand for housing and there is no sign this will change anytime soon. On the supply side, you have the fact that there just are not very many cities or towns of any real size that have a quick and efficient process for allowing new development to move through the entitlement process. On the demand side you have the tens of millions of legal and illegal immigrants we have added and will continue to add, and they all need a place to live - the illegals in particular are willing to pay cash and there are a lot of landlords that will happily take that.

    Some years back as the result of an online argument I looked at the annual number of residential building permits issued in CA starting in the 70s and compared it to the population growth attributable to immigration. Builders would have still been somewhat behind demand with zero immigration but it would not have been too much. Instead, population growth far outran housing production for the last 50 years and the result are the crushing real estate prices in a state that up until the 60s was perhaps the closest thing to a middle class paradise this country ever had, or ever will.

    Replies: @UNIT472, @RoatanBill

    Ever heard of the concept of ‘rent control’? New York City has had it for decades. There are more renters than landlords. Guess where the votes are.

    When the SHTF, the renters will have the upper hand because there are so many of them. The political class will throw the landlords to the curb for the votes. We already have a current moratorium. It is scheduled to end. My bet is that it will end and then be reinstated because the pols don’t want their cities to burn down.

    Real Estate that involves rent is too dangerous for my taste. If you own property in podunkville, and you live in it free of a mortgage, then you’re in good shape to weather the storm, but if you own rental property in the cities I think you’re toast in the long run. Your taxes will rise, your expenses will rise and the gov’t will freeze your ability to increase rents. That’s when Blackrock comes to your rescue and buys you out for a song so you can get rid of the headache. Blackrock WILL be able to control rents because they are going to make the market and they own the politicians.

  41. @TG
    Indeed, I agree, but like so many economists you are forgetting one important factor: physical reality.

    The rich have basically opened the border, and countless millions of third-world refugees are streaming across the border to be permanently resettled here - and all of them will need housing and roads and food and fresh water etc. Meanwhile our industrial base has been shipped to China, and despite occasional murmurs from Washington nothing is being done to bring any of that back. We continue to waste a trillion dollars a year on mindless overseas adventures, starving the domestic economy of investment. And parasitic finance - stock buybacks, the student loan scam, tens of trillions of dollars in taxpayer bailouts of Wall Street - also steers investments away from the real economy.

    Bottom line: more and more people, and stagnant real productive capacity. One way or the other, wages will fall relative to prices. Right now prices are going up and wages are stagnant. If the government stopped printing money, perhaps they could stabilize prices - but then wages would collapse, to keep the balance. Or maybe massive tax increases on the middle class will keep spending down and in line what what we can really produce - nominally wages will be high and prices low, but real spendable wages will be low. One way or the other, you can't consume what doesn't exist.

    So yes, printing money like crazy is nuts, agreed. But never forget the real world, and supply and demand.

    Replies: @notanon, @RoatanBill

    I heard that China just instituted price controls. That could just be MSM bullshit, but price controls are definitely in the US’s future. It’s one of the signs of an impending social explosion as price controls always result in scarcity.

    • Replies: @anon
    @RoatanBill

    I heard that China just instituted price controls.

    Link.

    Replies: @res

  42. @RoatanBill
    @TG

    I heard that China just instituted price controls. That could just be MSM bullshit, but price controls are definitely in the US's future. It's one of the signs of an impending social explosion as price controls always result in scarcity.

    Replies: @anon

    I heard that China just instituted price controls.

    Link.

    • Replies: @res
    @anon

    Probably this. Though note mulls vs. just instituted.
    https://www.bloomberg.com/news/articles/2021-06-09/china-considers-imposing-price-controls-on-surging-coal-market


    China’s efforts to control raw materials costs could include price limits on its runaway coal market, underscoring the government’s tough stance on taming inflation.
     
  43. @UNIT472
    Looking at how auto manufacturers are able to finance cars ought to show the problem of allowing institutional investors, like Banks or Blackrock, to buy homes in the retail market.

    We see an auto maker offer concessional finance rates ( zero to 1 percent ) to a new car buyer. How can they do this? Well GM, Toyota or VW don't borrow money from a bank. They can borrow on the capital markets or issue bonds. The car buyer cannot so the 'cost' of such concessional financing to the manufacturer is just a few basis points on a $30-40,000 loan Not much different than tossing in a free oil change or two but its a major incentive to a car buyer since he doesn't have to get a loan from a bank to buy a new car.

    Blackrock and other large institutional investors similarly borrow in a different market than retail buyers or investors. The Fed Funds rate is 0.25%, that is a daily rate, but Blackrock and banks can borrow overnight and you can't. They have access to Fed money and you don't so they are paying a far lower interest rate to finance the purchase of the house you wanted to buy without any of the expenses of a conventional mortgage loan.

    Clearly this was not the intent of Fed monetary policy which was to lower interest rates to make it possible for banks and other wholesale lenders to offer cheaper loans to retail buyers not to cut the retail buyer out of the market!

    Replies: @Daniel H

    Clearly this was not the intent of Fed monetary policy which was to lower interest rates to make it possible for banks and other wholesale lenders to offer cheaper loans to retail buyers not to cut the retail buyer out of the market!

    I don’t know, maybe that has been the intent of the Fed all along. They must know damn well that the low interest rates don’t trickle down to the consumer.

    I was irresponsible and profligate. Got myself into a jam. Was paying 18% to JP Morgan on a credit card debt…for years. None of that 1% financing was trickling down to me. Stopped paying last year because I lost the job. Three months ago I smarten’d up a little. Called JP Morgan and said. Let’s settle. 30 cents on the dollar (I probably cold have gotten 20, but I’m not a hard line negotiator). They agreed within t seconds of my proposal. Anybody here who has unsecured debt, I urge them to force the creditor to settle for pennies. And with a little motivation, indebted students can form a nationwide union to force the govt. to settle student debt for pennies. People have to take a little initiative.

    • Replies: @UNIT472
    @Daniel H

    Your right and I'm glad you stuck it JP Morgan/Chase. Those bastards allowed some hackers to steal thousands from my account. The Chase fraud investigators told me the hackers were based in Manila. Later I called to report some fraudulent wire transfers from my bank account and the girl I was talking to had a foreign accent. I asked where she was located and she said MANILA and then asked me for my password!

    BTW if you ever want to be a nice guy don't donate to St. Jude's or some other charity. Make your contribution count. Call a collection agency and offer to pay some delinquent medical bills for, as you say, pennies on the dollar. A $100 donation can pay off $1000 of medical debt.

  44. Get used to the term “neo-feudalism”. It’s going to come up a lot in the coming years.

    It would be very unfortunate if that were the case. Contemporary Westerners, groomed by centuries of Whig-historical propaganda, have been taught to think of feudalism as some sort of horribly repressive system that trod down the common man and granted exorbitant privileges to the aristocracy. This is not at all true. Feudalism was a natural hierarchy of reciprocal rights and duties between classes that instantiated the real principles of social justice as taught by the Holy Catholic Church.

    It is precisely the principles embodied in feudalism—which was distributist in nature—that are needed to get us OUT of the current mess, and it would be a masterstroke of satanic deception if the great number of the people were prevented from recognizing this due to the name becoming misapplied with opprobrium to the very oligarchic excesses it had always fought against.

    • Agree: V. K. Ovelund
    • Replies: @anon
    @Intelligent Dasein

    Nostalgia for things that never really existed is not a good way to think about problems.

    It's also not a plan.

    Walter Scott was not an historian, either.

    , @Twinkie
    @Intelligent Dasein


    It is precisely the principles embodied in feudalism—which was distributist in nature—that are needed to get us OUT of the current mess
     
    So would it be all right with you if I became a seignior and you a peasant under this marvelous scenario?

    https://youtu.be/t2c-X8HiBng

    I have a feeling you will be this kind of an argumentative peasant and I will have you repress you with the violence inherent in the system to shut you up.
  45. Inflation serves a number of purposes that are desirable by the current administration…

    1) The real value of debt decreases with inflation; if you owe $1 today, it will be easier to pay it back with inflated dollars tomorrow. Debtors benefit (i.e. people with large college loans or credit card debt), savers are screwed (i.e. people who have paid down their debt and are trying to save for their own retirement, independent of government largesse).

    2) Inflation coupled with high capital gains tax rates is essentially a wealth tax. Whether your investments outpace inflation or not, you will be forced to pay taxes if you sell.

    3) Inflated asset prices give the illusion of economic growth.

    So let’s just say that since inflation benefits the powers that be… there will be inflation. And lots of it.

  46. @SFG
    @dfordoom

    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.

    I'd say the advantage of communist regimes is that they have something the right no longer has tied into government--religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class. It has a devil (international capitalism), and liturgy (Mao's red book) and saints (Marx, Engels, Lenin, Mao). Right-wing military regimes tend not to have that, though premodern monarchies did.

    Replies: @dfordoom, @Pericles

    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.

    Yep. The dissident right is heavily driven by wishful thinking.

    I’d say the advantage of communist regimes is that they have something the right no longer has tied into government–religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class.

    Sort of, although some right-wing dictatorships have a definite quasi-religious aspect. The Nazis being the obvious example. And Franco’s regime was explicitly Catholic.

    Maybe the difference is that right-wing dictatorships are very emotional and too religious. They’re like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics. They have an absorbing interest in creating lasting political structures. The Chinese Communist Party isn’t communist any more but the Party still functions smoothly and efficiently.

    Ironically communists (in power) are less ideological than right-wing regimes. They have the patience and the discipline to knuckle down and get things done. Stalin thought that all that starry-eyed idealism was all very well but what the Soviet Union needed was a strong industrial base, and a bureaucracy to actually run things. And a Party structure to maintain continuity and stability.

    Compared to Franco or Hitler Stalin was very much a pragmatist. Mao was an idealist but he still understood that China needed to industrialise. Deng had no interest at all in idealism. Deng was interested in things that actually work.

    And communists are better at long-term thinking, and they’re interested in the future. Khrushchev and Deng were looking fifty years ahead. Franco was looking a hundred years in the past. Hitler was stuck in the Middle Ages.

    For right-wing dictatorships the future is envisaged as a recreation of the past. For liberal democracies the long term is what things will be like when the next election comes around. For communists the long term is what things will be like in fifty years.

    • Replies: @anon
    @dfordoom

    They’re like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics.

    That's why the Communist regimes of the 20th century never, ever had any sort of quasi-religious cult of personality, right?

    https://i.ytimg.com/vi/h0lezonp9bU/maxresdefault.jpg

    http://factsanddetails.com/media/2/20080218-Mao27.jpg

    http://i.pinimg.com/736x/db/f8/77/dbf8774cd0bc1157b5cb32ab38669c6b.jpg

    https://socialistworker.org/sites/default/files/imagecache/242/images/maostatue%20in%20china%20from%20air-b.jpg


    lol.

    Replies: @dfordoom

    , @Pericles
    @dfordoom

    Lol, I wonder how you get these Audacious commenting awards when you write silliness like this.

  47. Yep. The dissident right is heavily driven by wishful thinking.

    The trouble is that we can see the trap in which democracy has already caught us. Indeed, no commenter in this blog has more persistently identified the trap than you.

    Trying for a Franco might make matters worse, of course. That is quite likely. However, when things are already bad and getting worse, fear of Franco is not especially persuasive by comparison.

    And then there’s the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, …

    I am unsure how many of the dictatorships to which you refer even intended to survive the passing of their original dictators by more than a few years.

    The Germans got unlucky.

    Online debates over the German dictator have been so repetitive that I do not wish to start another one. However, you and I differ regarding the German dictator’s redeeming qualities. I chiefly blame the Soviet dictator and the British premier.

    Did I just start a debate, anyway? Well, that’s my last word on it, but feel free to have your say if you like! None of it is anything that has not been said before.

    • Thanks: nokangaroos
    • Replies: @Realist
    @V. K. Ovelund


    None of it is anything that has not been said before.
     
    True, but that is the case with all subjects.
    , @dfordoom
    @V. K. Ovelund


    Trying for a Franco might make matters worse, of course. That is quite likely. However, when things are already bad and getting worse, fear of Franco is not especially persuasive by comparison.
     
    The replacement of democracy by some form of dictatorship is a real possibility. A right-wing dictatorship is more likely than a left-wing one. The problem is that it's practically a certainty that such a dictatorship would be much much much worse than the current situation. Dictators don't just appear magically out of thin air. They appear because there are interest groups or power blocs with sufficient power to instal a dictator.

    Spain got Franco because Spain was still largely Catholic, the Catholic Church had immense power and influence, and the Army was ultra-conservative. Franco had sufficiently powerful interests backing him. But in the US what are the power blocs that might be capable of installing a dictator?

    Well firstly there's the military. What kind of right-wing dictator would the military support? The answer is, a right-wing dictator who would serve the interests of the military and the military-industrial complex and the foreign policy establishment. They would support a dictator who gave then what they want - unswerving support for Israel and war, war and more war.

    A second group which might be able to instal a dictator is the intelligence community. What kind of right-wing dictator would they support? The answer is, a Woke right-wing dictator who would support their crazy plans for foreign interventionism.

    A third group would be the corporate sector. They would want a right-wing who would loyally serve the interests of the mega-corporations and the banks.

    There is simply no power bloc capable of installing the kind of right-wing dictator that you would like to see, or that Twinkie would like to see.

    You would almost certainly end up with a right-wing dictator who would support policies that would please the groups who put that dictator in power, which would mean even higher levels of immigration, even more destructive neoliberal economic policies, even more aggressive pro-Israel neoconservative foreign policies. It is very very unlikely that any kind of social conservatism would be on the agenda of such a dictator.

    The chances that you would get a right-wing dictator who would be even mildly palatable to the dissident right are approximately zero.
  48. anon[363] • Disclaimer says:
    @dfordoom
    @SFG


    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.
     
    Yep. The dissident right is heavily driven by wishful thinking.

    I’d say the advantage of communist regimes is that they have something the right no longer has tied into government–religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class.
     
    Sort of, although some right-wing dictatorships have a definite quasi-religious aspect. The Nazis being the obvious example. And Franco's regime was explicitly Catholic.

    Maybe the difference is that right-wing dictatorships are very emotional and too religious. They're like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics. They have an absorbing interest in creating lasting political structures. The Chinese Communist Party isn't communist any more but the Party still functions smoothly and efficiently.

    Ironically communists (in power) are less ideological than right-wing regimes. They have the patience and the discipline to knuckle down and get things done. Stalin thought that all that starry-eyed idealism was all very well but what the Soviet Union needed was a strong industrial base, and a bureaucracy to actually run things. And a Party structure to maintain continuity and stability.

    Compared to Franco or Hitler Stalin was very much a pragmatist. Mao was an idealist but he still understood that China needed to industrialise. Deng had no interest at all in idealism. Deng was interested in things that actually work.

    And communists are better at long-term thinking, and they're interested in the future. Khrushchev and Deng were looking fifty years ahead. Franco was looking a hundred years in the past. Hitler was stuck in the Middle Ages.

    For right-wing dictatorships the future is envisaged as a recreation of the past. For liberal democracies the long term is what things will be like when the next election comes around. For communists the long term is what things will be like in fifty years.

    Replies: @anon, @Pericles

    They’re like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics.

    That’s why the Communist regimes of the 20th century never, ever had any sort of quasi-religious cult of personality, right?

    lol.

    • Replies: @dfordoom
    @anon



    They’re like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics.
     
    That’s why the Communist regimes of the 20th century never, ever had any sort of quasi-religious cult of personality, right?
     
    You've missed my point entirely. Communist regimes made use of personality cults because communists understood the usefulness of giving the masses something that would make them happy. It's a technique that has been used by monarchies (Louis XIV, the Tsarist regime in Russia, quasi-religious cults of emperors as in Japan and China, the deification of emperors in Imperial Rome). There were personality cults built around Elizabeth I and Queen Victoria. Liberal democracies make use of personality cults (the cult of Churchill, Lincoln, JFK, Trump). Right-wing dictatorships built personality cults around Franco, Mussolini and that Austrian painter chap.

    It's a cynical but useful means of keeping the masses happy and obedient.

    The important point is that while creating these personality cults to distract the masses the communists got on with the job of consolidating their power base by building bureaucracies and Party structures that would maintain their hold on power. They were good at that sort of thing because it appealed to them. They loved the nuts-and-bolts side of political power and they understood its importance. That's why such regimes were able to survive the deaths of the figures that those personality cults were built around. They had the structures in place to transfer power into new hands.

    The quasi-religious side of communist regimes was also built to a large extent around the Party itself, and around its ideology. Stalin could die but the cult of the Party and of Marxist-Leninism would go on. Mao could die but the cult of the Party would go on. Kim Il-sung could die but the cult of the Party would go on.

    I assume you're making the mistake of assuming that I'm advocating for communism. I'm not. I'm merely pointing out why communist regimes were surprisingly durable whereas right-wing dictatorships collapsed as soon as the original dictator died.

    Even if you disapprove of a particular political movement you can learn lesson from what that political movement did that worked.

    Replies: @anon

  49. @Mark G.
    Overly greedy elites may be suffering from hubris in thinking this widening gap between the rich and the poor will continue. We've seen the radicalization of the left with movements like antifa. In nineteen thirties Germany, the rise of a Communist oriented left resulted in many Germans throwing their support behind the Nazis to block a Communist takeover of the country. They ended with the dictator Hitler. This wasn't the first time something like this occurred in history. The excesses of the Jacobins in the late 18th century led to many of the French looking to Bonaparte to establish order. In short order, they too found themselves with a dictator.

    The U.S. had a revolution in the late 18th century which turned out much better than the French one. Rather than being influenced by French Enlightenment figures like Voltaire, Diderot and Rousseau they were influenced by the more moderate Scottish Enlightenment figures like Smith, Ferguson and Hume.

    If we want to avoid ending up having a dictator in this country, we would do well to go back and read the writings of the leaders of the American Revolution along with the Scottish Enlightenment figures who influenced them and apply what can be learned from them. The major economic treatise of the Scottish Enlightenment was Smith's Wealth of Nations. Smith planned to write a major political treatise after that but passed away before he had a chance to do so. The American disciples of Scottish Enlightenment thought included Madison, Hamilton and Jay. They wrote something that would probably have resembled Smith's unwritten political treatise: The Federalist. The only possible solution to our current problems is to return to the ideas that made the U.S. the wealthiest and most free country in history.

    Replies: @Twinkie, @Eric Novak, @Observator

    “ The only possible solution to our current problems is to return to the ideas that made the U.S. the wealthiest and most free country in history.”
    America will have a Third World political majority by the end of this decade. Why don’t you know this?

  50. Late comment:

    In a depression coupled with high inflation, the best bet will be building local networks of support (down to local self-sufficiency), save aggressively in real terms and wait out the violent episodes of economic ruin. We now have a depression with high inflation induced to restructure the economy and consolidate control of economic power into a few hands, into Davos. So the whole strategy gains an extra layer of meaning – of independence from subservience.

    Everyone will eventually come out of depression and enter a decent normal (albeit last time after a bloody World War). But likely not this time, and those going local, will stay local for the foreseeable future.

  51. @RoatanBill
    @onebornfree

    Look at the recent run up in prices for most industrial commodities. The exceptions are the precious metals due to a rigged paper market.

    Gold and especially silver are tremendously undervalued (cheap); mining output has been falling for years because it's uneconomic to mine at current prices. Therefore, I conclude that these metals are primed for an increase, especially since the Basel III regulations are coming on line at the end of the month for the EU and at the end of the year for that den of thieves in the City of London, England. Those regs make it uneconomic for the bullion banks to continue to play the paper market. They are going to be asked to have 85% physical for every paper contract they submit. The naked shorts are going away and when that happens, the rigging disappears.

    Specifically for silver, it is an industrial metal needed for solar panels, EV's and many other products and a substitute is not readily available. The 'Wall Street Silver' Reddit group has figured it out and they are pushing for people to take delivery of metal as opposed to cashing out in fiat. Supplies are tight with retail premiums way over the spot market and silver in all forms is near to becoming unobtainium.

    Replies: @onebornfree

    As a former hard-core gold-bug [80’s through early 90’s] , I understand where you are coming from, and I could probably take a similar position on precious metals if I didn’t watch myself. 😎

    It was hard for me to learn 2 vital real world lessons concerning hard money investments and economics :

    1] [This was hard pill for me to swallow] : Increases in the money supply [ie central bank monetary inflation] will _not_ definitely cause almost instantaneous wide spread rapid inflation [defined as a general loss of purchasing power of the currency unit, the $US], in the market place. [There are fundamental , underlying reasons for this that I won’t get into here]. Many “gold-bugs”, Austrian economists, libertarians, anarchists and related continue to suffer under that particular delusion [ ie that increases in the money supply will always cause almost immediate, significant loss of purchasing power for the $US ]

    2] More importantly in the big picture [which directly relates to point [1] above], is that “Economics Is NOT a Science”:
    http://onebornfreesfinancialsafetyreports.blogspot.com/2013/11/bill-bonner-repeat-after-me-economics.html

    Also see: “Is Gold Under Or Overvalued?” http://onebornfreesfinancialsafetyreports.blogspot.com/2013/07/is-gold-under-or-overvalued.html

    and: “Gerald Celente-The Strange Contradictions of a Fortune-Telling Gold Bug”:
    http://onebornfreesfinancialsafetyreports.blogspot.com/2012/01/

    I wish you luck with your gold and silver speculations.

    Regards, onebornfree

    • Replies: @RoatanBill
    @onebornfree

    If I were to cash out my PM holdings now, I'd be up a serious percentage in a relatively short time.

    You seem to emphasize 'immediate' in your inflation comment. I don't usually look at things short term. My premise is that sooner or later, currency printing eventually leads to inflation and in severe cases as in the US, hyperinflation. Last I heard, 20% of all US currency was created in the last year or so. The world is also sick of being sanctioned where the US Dollar and the SWIFT system are the actual weapons employed.

    I don't think anyone can rationalize away the trend towards US Dollar collapse any day now. It could take years but it's most likely to occur when a foreign entity decides to pull the plug on the Dollar and I'd bet that's real close. The US military is no longer considered the threat it once was and given the fact that the US's portion of world GDP is now a fraction of what it was after WW-II, the handwriting is on the wall if one wants to read it.

    Replies: @onebornfree, @Ralph B. Seymour

  52. @Daniel H
    @UNIT472


    Clearly this was not the intent of Fed monetary policy which was to lower interest rates to make it possible for banks and other wholesale lenders to offer cheaper loans to retail buyers not to cut the retail buyer out of the market!
     
    I don't know, maybe that has been the intent of the Fed all along. They must know damn well that the low interest rates don't trickle down to the consumer.

    I was irresponsible and profligate. Got myself into a jam. Was paying 18% to JP Morgan on a credit card debt...for years. None of that 1% financing was trickling down to me. Stopped paying last year because I lost the job. Three months ago I smarten'd up a little. Called JP Morgan and said. Let's settle. 30 cents on the dollar (I probably cold have gotten 20, but I'm not a hard line negotiator). They agreed within t seconds of my proposal. Anybody here who has unsecured debt, I urge them to force the creditor to settle for pennies. And with a little motivation, indebted students can form a nationwide union to force the govt. to settle student debt for pennies. People have to take a little initiative.

    Replies: @UNIT472

    Your right and I’m glad you stuck it JP Morgan/Chase. Those bastards allowed some hackers to steal thousands from my account. The Chase fraud investigators told me the hackers were based in Manila. Later I called to report some fraudulent wire transfers from my bank account and the girl I was talking to had a foreign accent. I asked where she was located and she said MANILA and then asked me for my password!

    BTW if you ever want to be a nice guy don’t donate to St. Jude’s or some other charity. Make your contribution count. Call a collection agency and offer to pay some delinquent medical bills for, as you say, pennies on the dollar. A $100 donation can pay off $1000 of medical debt.

  53. @Mark G.
    Overly greedy elites may be suffering from hubris in thinking this widening gap between the rich and the poor will continue. We've seen the radicalization of the left with movements like antifa. In nineteen thirties Germany, the rise of a Communist oriented left resulted in many Germans throwing their support behind the Nazis to block a Communist takeover of the country. They ended with the dictator Hitler. This wasn't the first time something like this occurred in history. The excesses of the Jacobins in the late 18th century led to many of the French looking to Bonaparte to establish order. In short order, they too found themselves with a dictator.

    The U.S. had a revolution in the late 18th century which turned out much better than the French one. Rather than being influenced by French Enlightenment figures like Voltaire, Diderot and Rousseau they were influenced by the more moderate Scottish Enlightenment figures like Smith, Ferguson and Hume.

    If we want to avoid ending up having a dictator in this country, we would do well to go back and read the writings of the leaders of the American Revolution along with the Scottish Enlightenment figures who influenced them and apply what can be learned from them. The major economic treatise of the Scottish Enlightenment was Smith's Wealth of Nations. Smith planned to write a major political treatise after that but passed away before he had a chance to do so. The American disciples of Scottish Enlightenment thought included Madison, Hamilton and Jay. They wrote something that would probably have resembled Smith's unwritten political treatise: The Federalist. The only possible solution to our current problems is to return to the ideas that made the U.S. the wealthiest and most free country in history.

    Replies: @Twinkie, @Eric Novak, @Observator

    Seems to me that crediting the material success of the United States to an economic ideology entirely misses the point of what actually happened. The new country started out with the fabulous advantage of access to the untouched mineral and agricultural wealth of three and a half million square miles of land, the incredible abundance of vast offshore fisheries, and the labor stolen from over ten million African slaves.

    You would have to be a total fool not to profit under these conditions, the crackpot theories of Adam Smith notwithstanding.

    And speaking of Smith, the inventor of the “invisible hand” theory was a social philosopher whose ultimate goal was the good of the community. In keeping with the radical rejection of revealed religion which defined the Enlightenment, he discarded the traditional notion of divine providence in human affairs. In its place he postulated a similarly magical force which, by encouraging the selfish greed of the most avaricious members of society, would ultimately uplift all. He unconsciously embraced the peculiar passions of upper class Englishmen – arrogance, greed, and competition – as axiomatic of humanity’s motivation in all times and under all conditions. Ricardo and Malthus, and a host of subsequent, more rational economists proved him wrong almost immediately, and his works lapsed into obscurity.

    Smith’s revival among the voodoo economists of today’s neoconservative movement is a smokescreen for their plan to replace the America we love with a tyrannical oligarchy of wealth. As the all-too-often selectively quoted Adam Smith actually said: “All for ourselves, and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind.”

    • Replies: @Thorfinnsson
    @Observator

    You can't steal labor from a slave, they're property. The output of the slave is the property of the slave-owner, similar to livestock.

    , @Mark G.
    @Observator


    Seems to me that crediting the material success of the United States to an economic ideology entirely misses the point of what actually happened. The new country started out with the fabulous advantage of access to the untouched mineral and agricultural wealth of three and a half million square miles of land, the incredible abundance of vast offshore fisheries, and the labor stolen from over ten million African slaves.
     
    Slavery had existed all through history yet mankind had remained poor. The average life expectancy in seventeenth century London was not much higher than in Ancient Athens two thousand years before. Here in the U.S. average life expectancy increased from 40 in 1865 to 55 in 1915. Then it increased from 55 in 1915 to 70 in 1965. It was because the freedom in this country allowed the scientific and industrial revolutions to occur that we had the big improvement in the life of the average person. Blacks in the U.S. have the highest standard of living of any blacks in the whole world. Instead of whites being better off having blacks around, blacks are better off having whites around.

    Having abundant natural resources did help American growth but it required a political system that respected property rights and a free market economy. Many other countries like Russia or Brazil had extensive natural resources but stayed poor.

    Your comment is a prime example of the muddy and incoherent thinking that has become prevalent in the U.S. and is why the country is declining. Almost everyone now mindlessly parrots the type of thing you say. If the ideas of the Founders were wrong, then moving away from them should have led the country to become better off. Instead, as we moved away from them, things have become worse off.
  54. @V. K. Ovelund

    Yep. The dissident right is heavily driven by wishful thinking.
     
    The trouble is that we can see the trap in which democracy has already caught us. Indeed, no commenter in this blog has more persistently identified the trap than you.

    Trying for a Franco might make matters worse, of course. That is quite likely. However, when things are already bad and getting worse, fear of Franco is not especially persuasive by comparison.


    And then there’s the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, ...
     
    I am unsure how many of the dictatorships to which you refer even intended to survive the passing of their original dictators by more than a few years.

    The Germans got unlucky.
     
    Online debates over the German dictator have been so repetitive that I do not wish to start another one. However, you and I differ regarding the German dictator's redeeming qualities. I chiefly blame the Soviet dictator and the British premier.

    Did I just start a debate, anyway? Well, that's my last word on it, but feel free to have your say if you like! None of it is anything that has not been said before.

    Replies: @Realist, @dfordoom

    None of it is anything that has not been said before.

    True, but that is the case with all subjects.

  55. @Observator
    @Mark G.

    Seems to me that crediting the material success of the United States to an economic ideology entirely misses the point of what actually happened. The new country started out with the fabulous advantage of access to the untouched mineral and agricultural wealth of three and a half million square miles of land, the incredible abundance of vast offshore fisheries, and the labor stolen from over ten million African slaves.

    You would have to be a total fool not to profit under these conditions, the crackpot theories of Adam Smith notwithstanding.

    And speaking of Smith, the inventor of the "invisible hand" theory was a social philosopher whose ultimate goal was the good of the community. In keeping with the radical rejection of revealed religion which defined the Enlightenment, he discarded the traditional notion of divine providence in human affairs. In its place he postulated a similarly magical force which, by encouraging the selfish greed of the most avaricious members of society, would ultimately uplift all. He unconsciously embraced the peculiar passions of upper class Englishmen - arrogance, greed, and competition - as axiomatic of humanity’s motivation in all times and under all conditions. Ricardo and Malthus, and a host of subsequent, more rational economists proved him wrong almost immediately, and his works lapsed into obscurity.

    Smith’s revival among the voodoo economists of today's neoconservative movement is a smokescreen for their plan to replace the America we love with a tyrannical oligarchy of wealth. As the all-too-often selectively quoted Adam Smith actually said: "All for ourselves, and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind."

    Replies: @Thorfinnsson, @Mark G.

    You can’t steal labor from a slave, they’re property. The output of the slave is the property of the slave-owner, similar to livestock.

    • LOL: iffen
  56. @SFG
    @dfordoom

    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.

    I'd say the advantage of communist regimes is that they have something the right no longer has tied into government--religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class. It has a devil (international capitalism), and liturgy (Mao's red book) and saints (Marx, Engels, Lenin, Mao). Right-wing military regimes tend not to have that, though premodern monarchies did.

    Replies: @dfordoom, @Pericles

    You already have unreined power detached from responsibility, not really a better situation.

  57. @dfordoom
    @SFG


    Everyone (on the dissident right) imagines a King Franco, or King Pinochet, or King Salazar.

    They forget about the possibility of a King Obama, or a Queen Clinton, or a King Schumer.
     
    Yep. The dissident right is heavily driven by wishful thinking.

    I’d say the advantage of communist regimes is that they have something the right no longer has tied into government–religion. Communism has many religious aspects, and gives a transcendent purpose in the sense of the triumph of the international working class.
     
    Sort of, although some right-wing dictatorships have a definite quasi-religious aspect. The Nazis being the obvious example. And Franco's regime was explicitly Catholic.

    Maybe the difference is that right-wing dictatorships are very emotional and too religious. They're like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics. They have an absorbing interest in creating lasting political structures. The Chinese Communist Party isn't communist any more but the Party still functions smoothly and efficiently.

    Ironically communists (in power) are less ideological than right-wing regimes. They have the patience and the discipline to knuckle down and get things done. Stalin thought that all that starry-eyed idealism was all very well but what the Soviet Union needed was a strong industrial base, and a bureaucracy to actually run things. And a Party structure to maintain continuity and stability.

    Compared to Franco or Hitler Stalin was very much a pragmatist. Mao was an idealist but he still understood that China needed to industrialise. Deng had no interest at all in idealism. Deng was interested in things that actually work.

    And communists are better at long-term thinking, and they're interested in the future. Khrushchev and Deng were looking fifty years ahead. Franco was looking a hundred years in the past. Hitler was stuck in the Middle Ages.

    For right-wing dictatorships the future is envisaged as a recreation of the past. For liberal democracies the long term is what things will be like when the next election comes around. For communists the long term is what things will be like in fifty years.

    Replies: @anon, @Pericles

    Lol, I wonder how you get these Audacious commenting awards when you write silliness like this.

    • Agree: Catdog
  58. @onebornfree
    @RoatanBill

    As a former hard-core gold-bug [80's through early 90's] , I understand where you are coming from, and I could probably take a similar position on precious metals if I didn't watch myself. 😎

    It was hard for me to learn 2 vital real world lessons concerning hard money investments and economics :

    1] [This was hard pill for me to swallow] : Increases in the money supply [ie central bank monetary inflation] will _not_ definitely cause almost instantaneous wide spread rapid inflation [defined as a general loss of purchasing power of the currency unit, the $US], in the market place. [There are fundamental , underlying reasons for this that I won't get into here]. Many "gold-bugs", Austrian economists, libertarians, anarchists and related continue to suffer under that particular delusion [ ie that increases in the money supply will always cause almost immediate, significant loss of purchasing power for the $US ]

    2] More importantly in the big picture [which directly relates to point [1] above], is that "Economics Is NOT a Science":
    http://onebornfreesfinancialsafetyreports.blogspot.com/2013/11/bill-bonner-repeat-after-me-economics.html

    Also see: "Is Gold Under Or Overvalued?" http://onebornfreesfinancialsafetyreports.blogspot.com/2013/07/is-gold-under-or-overvalued.html

    and: "Gerald Celente-The Strange Contradictions of a Fortune-Telling Gold Bug":
    http://onebornfreesfinancialsafetyreports.blogspot.com/2012/01/

    I wish you luck with your gold and silver speculations.

    Regards, onebornfree

    Replies: @RoatanBill

    If I were to cash out my PM holdings now, I’d be up a serious percentage in a relatively short time.

    You seem to emphasize ‘immediate’ in your inflation comment. I don’t usually look at things short term. My premise is that sooner or later, currency printing eventually leads to inflation and in severe cases as in the US, hyperinflation. Last I heard, 20% of all US currency was created in the last year or so. The world is also sick of being sanctioned where the US Dollar and the SWIFT system are the actual weapons employed.

    I don’t think anyone can rationalize away the trend towards US Dollar collapse any day now. It could take years but it’s most likely to occur when a foreign entity decides to pull the plug on the Dollar and I’d bet that’s real close. The US military is no longer considered the threat it once was and given the fact that the US’s portion of world GDP is now a fraction of what it was after WW-II, the handwriting is on the wall if one wants to read it.

    • Replies: @onebornfree
    @RoatanBill

    "My premise is that sooner or later, currency printing eventually leads to inflation and in severe cases as in the US, hyperinflation."

    Oh, I agree. But that does not mean that it will definitely happen during yours or my lifetimes

    "I don’t think anyone can rationalize away the trend towards US Dollar collapse any day now."

    "Any day now" ? Doesn't this contradict your previous comment above, or am I missing something?

    Regards, onebornfree
    http://onebornfreesfinancialsafetyreports.blogspot.com

    , @Ralph B. Seymour
    @RoatanBill

    I agree with all that, but what currency will people use?

    All currencies are being ruined.

    Replies: @RoatanBill

  59. @V. K. Ovelund

    Yep. The dissident right is heavily driven by wishful thinking.
     
    The trouble is that we can see the trap in which democracy has already caught us. Indeed, no commenter in this blog has more persistently identified the trap than you.

    Trying for a Franco might make matters worse, of course. That is quite likely. However, when things are already bad and getting worse, fear of Franco is not especially persuasive by comparison.


    And then there’s the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, ...
     
    I am unsure how many of the dictatorships to which you refer even intended to survive the passing of their original dictators by more than a few years.

    The Germans got unlucky.
     
    Online debates over the German dictator have been so repetitive that I do not wish to start another one. However, you and I differ regarding the German dictator's redeeming qualities. I chiefly blame the Soviet dictator and the British premier.

    Did I just start a debate, anyway? Well, that's my last word on it, but feel free to have your say if you like! None of it is anything that has not been said before.

    Replies: @Realist, @dfordoom

    Trying for a Franco might make matters worse, of course. That is quite likely. However, when things are already bad and getting worse, fear of Franco is not especially persuasive by comparison.

    The replacement of democracy by some form of dictatorship is a real possibility. A right-wing dictatorship is more likely than a left-wing one. The problem is that it’s practically a certainty that such a dictatorship would be much much much worse than the current situation. Dictators don’t just appear magically out of thin air. They appear because there are interest groups or power blocs with sufficient power to instal a dictator.

    Spain got Franco because Spain was still largely Catholic, the Catholic Church had immense power and influence, and the Army was ultra-conservative. Franco had sufficiently powerful interests backing him. But in the US what are the power blocs that might be capable of installing a dictator?

    Well firstly there’s the military. What kind of right-wing dictator would the military support? The answer is, a right-wing dictator who would serve the interests of the military and the military-industrial complex and the foreign policy establishment. They would support a dictator who gave then what they want – unswerving support for Israel and war, war and more war.

    A second group which might be able to instal a dictator is the intelligence community. What kind of right-wing dictator would they support? The answer is, a Woke right-wing dictator who would support their crazy plans for foreign interventionism.

    A third group would be the corporate sector. They would want a right-wing who would loyally serve the interests of the mega-corporations and the banks.

    There is simply no power bloc capable of installing the kind of right-wing dictator that you would like to see, or that Twinkie would like to see.

    You would almost certainly end up with a right-wing dictator who would support policies that would please the groups who put that dictator in power, which would mean even higher levels of immigration, even more destructive neoliberal economic policies, even more aggressive pro-Israel neoconservative foreign policies. It is very very unlikely that any kind of social conservatism would be on the agenda of such a dictator.

    The chances that you would get a right-wing dictator who would be even mildly palatable to the dissident right are approximately zero.

  60. It’s always “different this time” before a crash. I hope, anyway.

    • Agree: V. K. Ovelund
  61. @Observator
    @Mark G.

    Seems to me that crediting the material success of the United States to an economic ideology entirely misses the point of what actually happened. The new country started out with the fabulous advantage of access to the untouched mineral and agricultural wealth of three and a half million square miles of land, the incredible abundance of vast offshore fisheries, and the labor stolen from over ten million African slaves.

    You would have to be a total fool not to profit under these conditions, the crackpot theories of Adam Smith notwithstanding.

    And speaking of Smith, the inventor of the "invisible hand" theory was a social philosopher whose ultimate goal was the good of the community. In keeping with the radical rejection of revealed religion which defined the Enlightenment, he discarded the traditional notion of divine providence in human affairs. In its place he postulated a similarly magical force which, by encouraging the selfish greed of the most avaricious members of society, would ultimately uplift all. He unconsciously embraced the peculiar passions of upper class Englishmen - arrogance, greed, and competition - as axiomatic of humanity’s motivation in all times and under all conditions. Ricardo and Malthus, and a host of subsequent, more rational economists proved him wrong almost immediately, and his works lapsed into obscurity.

    Smith’s revival among the voodoo economists of today's neoconservative movement is a smokescreen for their plan to replace the America we love with a tyrannical oligarchy of wealth. As the all-too-often selectively quoted Adam Smith actually said: "All for ourselves, and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind."

    Replies: @Thorfinnsson, @Mark G.

    Seems to me that crediting the material success of the United States to an economic ideology entirely misses the point of what actually happened. The new country started out with the fabulous advantage of access to the untouched mineral and agricultural wealth of three and a half million square miles of land, the incredible abundance of vast offshore fisheries, and the labor stolen from over ten million African slaves.

    Slavery had existed all through history yet mankind had remained poor. The average life expectancy in seventeenth century London was not much higher than in Ancient Athens two thousand years before. Here in the U.S. average life expectancy increased from 40 in 1865 to 55 in 1915. Then it increased from 55 in 1915 to 70 in 1965. It was because the freedom in this country allowed the scientific and industrial revolutions to occur that we had the big improvement in the life of the average person. Blacks in the U.S. have the highest standard of living of any blacks in the whole world. Instead of whites being better off having blacks around, blacks are better off having whites around.

    Having abundant natural resources did help American growth but it required a political system that respected property rights and a free market economy. Many other countries like Russia or Brazil had extensive natural resources but stayed poor.

    Your comment is a prime example of the muddy and incoherent thinking that has become prevalent in the U.S. and is why the country is declining. Almost everyone now mindlessly parrots the type of thing you say. If the ideas of the Founders were wrong, then moving away from them should have led the country to become better off. Instead, as we moved away from them, things have become worse off.

  62. @anon
    @dfordoom

    They’re like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics.

    That's why the Communist regimes of the 20th century never, ever had any sort of quasi-religious cult of personality, right?

    https://i.ytimg.com/vi/h0lezonp9bU/maxresdefault.jpg

    http://factsanddetails.com/media/2/20080218-Mao27.jpg

    http://i.pinimg.com/736x/db/f8/77/dbf8774cd0bc1157b5cb32ab38669c6b.jpg

    https://socialistworker.org/sites/default/files/imagecache/242/images/maostatue%20in%20china%20from%20air-b.jpg


    lol.

    Replies: @dfordoom

    They’re like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics.

    That’s why the Communist regimes of the 20th century never, ever had any sort of quasi-religious cult of personality, right?

    You’ve missed my point entirely. Communist regimes made use of personality cults because communists understood the usefulness of giving the masses something that would make them happy. It’s a technique that has been used by monarchies (Louis XIV, the Tsarist regime in Russia, quasi-religious cults of emperors as in Japan and China, the deification of emperors in Imperial Rome). There were personality cults built around Elizabeth I and Queen Victoria. Liberal democracies make use of personality cults (the cult of Churchill, Lincoln, JFK, Trump). Right-wing dictatorships built personality cults around Franco, Mussolini and that Austrian painter chap.

    It’s a cynical but useful means of keeping the masses happy and obedient.

    The important point is that while creating these personality cults to distract the masses the communists got on with the job of consolidating their power base by building bureaucracies and Party structures that would maintain their hold on power. They were good at that sort of thing because it appealed to them. They loved the nuts-and-bolts side of political power and they understood its importance. That’s why such regimes were able to survive the deaths of the figures that those personality cults were built around. They had the structures in place to transfer power into new hands.

    The quasi-religious side of communist regimes was also built to a large extent around the Party itself, and around its ideology. Stalin could die but the cult of the Party and of Marxist-Leninism would go on. Mao could die but the cult of the Party would go on. Kim Il-sung could die but the cult of the Party would go on.

    I assume you’re making the mistake of assuming that I’m advocating for communism. I’m not. I’m merely pointing out why communist regimes were surprisingly durable whereas right-wing dictatorships collapsed as soon as the original dictator died.

    Even if you disapprove of a particular political movement you can learn lesson from what that political movement did that worked.

    • Replies: @anon
    @dfordoom

    You’ve missed my point entirely.

    Don't think so.

    Communist regimes made use of personality cults because communists understood the usefulness of giving the masses something that would make them happy.

    Cult of personality was present from the very start in just about every 20th century Communist regime. This contradicts your handwavy claim. Various flavours of leftism rely on cult of personality. I doubt you will agree, but the facts are obvious nevertheless.

    The important point is that while creating these personality cults to distract the masses the communists got on with the job of consolidating their power base by building bureaucracies and Party structures that would maintain their hold on power.

    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.

    I assume you’re making the mistake of assuming that I’m advocating for communism.

    You would assume incorrectly, again.

    Replies: @dfordoom, @Triteleia Laxa

  63. and the labor stolen from over ten million African slaves.

    iirc Brazil imported c. 16 times the number of Black slaves as the US so why aren’t they 16x richer than the US?

    the US slave states vs the free states

    the Arab world had millions of African slaves for centuries

    so apart from the moral argument slavery is *clearly* a very inefficient system which has a *negative* impact on overall economic success

    i.e. the US peak would have been much *higher* if there had never been slavery.

    The new country started out with the fabulous advantage of…

    so did south America

    so again clearly the US had some other advantage (personally I’d say it was demographics) but whatever it was it clearly had something.

  64. our democracies currently don’t work because we have a corrupt elite pulling the strings behind the scenes

    (via blackmail, bribery and media control)

    i don’t see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes

    so imo the key is not really an alternate form of govt; the key is removing our corrupt elite from positions of power.

    • Replies: @dfordoom
    @notanon


    i don’t see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes.
     
    That's a valid point. A monarch or (even more especially) a dictator would be dependent on the powerful interest groups that put him into power. He would most likely be a puppet for those interest groups.

    The idea that a dictator would be an improvement is dissident right cope, based on the delusion that somehow, magically, a dictator would be the kind of dictator that dissident rightists fantasise about.

    Replies: @V. K. Ovelund

    , @dfordoom
    @notanon


    i don’t see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes

    so imo the key is not really an alternate form of govt; the key is removing our corrupt elite from positions of power.
     
    The dictator delusion is very much like the Trump Delusion. If Trump gets elected in 2016 he'll fix everything. You'll see. Everything will be OK then. He can do it, because he's the God-Emperor.
  65. @notanon
    our democracies currently don't work because we have a corrupt elite pulling the strings behind the scenes

    (via blackmail, bribery and media control)

    i don't see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes

    so imo the key is not really an alternate form of govt; the key is removing our corrupt elite from positions of power.

    Replies: @dfordoom, @dfordoom

    i don’t see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes.

    That’s a valid point. A monarch or (even more especially) a dictator would be dependent on the powerful interest groups that put him into power. He would most likely be a puppet for those interest groups.

    The idea that a dictator would be an improvement is dissident right cope, based on the delusion that somehow, magically, a dictator would be the kind of dictator that dissident rightists fantasise about.

    • Replies: @V. K. Ovelund
    @dfordoom

    The straw man has become a regular guest at this dinner table. We are getting to know him rather well.


    The idea that a dictator would be an improvement is dissident right cope, based on the delusion that somehow, magically, a dictator would be the kind of dictator that dissident rightists fantasise about.
     
    The only fantasy is that this were what the dissident right thinks.

    Replies: @V. K. Ovelund

  66. @notanon
    our democracies currently don't work because we have a corrupt elite pulling the strings behind the scenes

    (via blackmail, bribery and media control)

    i don't see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes

    so imo the key is not really an alternate form of govt; the key is removing our corrupt elite from positions of power.

    Replies: @dfordoom, @dfordoom

    i don’t see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes

    so imo the key is not really an alternate form of govt; the key is removing our corrupt elite from positions of power.

    The dictator delusion is very much like the Trump Delusion. If Trump gets elected in 2016 he’ll fix everything. You’ll see. Everything will be OK then. He can do it, because he’s the God-Emperor.

    • Agree: notanon
  67. @Triteleia Laxa
    If BlackRock are doing this to make money, they are mistaken. It is a big risk in the short run that interest rates go up and the property market crashes. You argue that, on some level, they know otherwise. I doubt it, even if they are gambling that way, but fine.

    The real problem, though, is that house prices are greatly determined by local supply; and local supply is extremely restricted. The more local voters who are owners, the greater the NIMBY vote.

    If BlackRock buys up entire neighbourhoods, BlackRock still gets zero votes. The renters within those houses get a lot of votes. The political incentives to allow more housebuilding become huge and houses get much cheaper.

    BlackRock just manage too much money and asset prices are stupidly high so they don't know what to do.

    Replies: @anon, @Robert Dolan, @Athletic and Whitesplosive

    Dumbass…..Blackrock doesn’t CARE about profits.

    Black rock is in the business of goy control.

    You are such a dipshit shill…..utterly transparent.

    You are going to have to try a LOT harder.

    • Replies: @Triteleia Laxa
    @Robert Dolan

    I've never met a grounded and intelligent person who speaks like you, in either style or substance. Why not?

  68. @anon
    @RoatanBill

    I heard that China just instituted price controls.

    Link.

    Replies: @res

    Probably this. Though note mulls vs. just instituted.
    https://www.bloomberg.com/news/articles/2021-06-09/china-considers-imposing-price-controls-on-surging-coal-market

    China’s efforts to control raw materials costs could include price limits on its runaway coal market, underscoring the government’s tough stance on taming inflation.

  69. @anon
    @Triteleia Laxa

    If BlackRock are doing this to make money, they are mistaken.

    Could be. Or it could be that Black Rock's team knows more about this than you do. Which strikes you as more likely?

    The real problem, though, is that house prices are greatly determined by local supply; and local supply is extremely restricted'

    That varies across markets depending on both the available land and zoning regulations. There's a lot of push to revise US zoning laws now, too, and "infill housing" has been a thing for over 20 years.

    Residential RE is a different market from commercial RE, and in both cases there is a physical object that can generate cash flow.

    Replies: @Triteleia Laxa

    They know more than I do, but their problem, of trillions to invest, requires, at the margins, improbable solutions.

  70. @Robert Dolan
    @Triteleia Laxa

    Dumbass.....Blackrock doesn't CARE about profits.

    Black rock is in the business of goy control.

    You are such a dipshit shill.....utterly transparent.

    You are going to have to try a LOT harder.

    Replies: @Triteleia Laxa

    I’ve never met a grounded and intelligent person who speaks like you, in either style or substance. Why not?

  71. res says:

    What I don’t understand is why Blackrock is paying 30% over asking. It seems like they could usually succeed with 10% over, and overpaying more just ignites the market even more increasing their future buying costs.

    It almost feels like an attempt at a market corner or short squeeze, but I don’t see how that would be possible here.

    • Agree: Audacious Epigone
    • Replies: @anon
    @res

    What I don’t understand is why Blackrock is paying 30% over asking.

    How do we know that is actually happening?

    It almost feels like an attempt at a market corner...

    That seems to be the case. It suggests a few things. So far I have not found much discussion of this in the bubble-press, but I really have not looked very hard.

    Replies: @res

  72. @dfordoom
    @notanon


    i don’t see any reason why a monarchy or dictatorship would work better *if* the same people were still there pulling the strings behind the scenes.
     
    That's a valid point. A monarch or (even more especially) a dictator would be dependent on the powerful interest groups that put him into power. He would most likely be a puppet for those interest groups.

    The idea that a dictator would be an improvement is dissident right cope, based on the delusion that somehow, magically, a dictator would be the kind of dictator that dissident rightists fantasise about.

    Replies: @V. K. Ovelund

    The straw man has become a regular guest at this dinner table. We are getting to know him rather well.

    The idea that a dictator would be an improvement is dissident right cope, based on the delusion that somehow, magically, a dictator would be the kind of dictator that dissident rightists fantasise about.

    The only fantasy is that this were what the dissident right thinks.

    • Agree: V. K. Ovelund
    • Replies: @V. K. Ovelund
    @V. K. Ovelund


    V. K. Ovelund says ... • Agree: V. K. Ovelund
     
    I misclicked, but didn't know that one could agree with one's own comment.

    @dfordoom

    My last comment came across too sharp. I cannot deny that, in the past, you have written truth about the dissident right where I was in error. Nevertheless, I know more dissident rightists than most here do as far as I am aware, and I just do not know any that hold some of the opinions you have ascribed to them.

    You have said that you do not watch television and I believe you. However, I still suspect that some of the televised tropes are filtering through to you at second hand. You have no duty to watch any video I link: I assume that you have better things to do with your time. Notwithstanding, given that I have linked video counterexamples with no response from you, ... well, it is a sign of the respect I bear for your judgment and intellect that the dissident-right caricature you propagate dismays me.

    Replies: @Mario Partisan

  73. @anyone with a brain
    @WorkingClass


    Why do I go to work? Ass dollars are as good as earned dollars.
     
    A deeper question is "I am at work, why should I work?"
    So many people have bullshit jobs where they do nothing productive, and so many business are just forms of rent seeking and receiving a form of royalty. Many people who are going to work or workers go and do fucking nothing of value, they are exactly the same, if not worse than someone sitting at home, because someone sitting at home is at least out of the way of commerce. While the zombie workers go out and block potential innovation with their mass and resistance to both work, and loss of their parasite position.

    Point is that these people ought to have the dignity to transform their paid positions into actual work and value or to quit and start a new business or change to a better job. And if they don't they are more worthy of scorn than those who stay at home and explicitly and honestly collect money for doing nothing.

    Replies: @Hermes

    I think a large proportion of the office jobs that have been created since the 1960s are basically make-work affirmative action jobs for women and NAMs. Look at the explosion in the size of HR departments. This is also probably an overlooked factor in the proliferation of college administrators.

    These jobs create or produce nothing. We put men on the moon without multi-thousand-employee HR departments.

  74. anon[339] • Disclaimer says:
    @res
    What I don't understand is why Blackrock is paying 30% over asking. It seems like they could usually succeed with 10% over, and overpaying more just ignites the market even more increasing their future buying costs.

    It almost feels like an attempt at a market corner or short squeeze, but I don't see how that would be possible here.

    Replies: @anon

    What I don’t understand is why Blackrock is paying 30% over asking.

    How do we know that is actually happening?

    It almost feels like an attempt at a market corner…

    That seems to be the case. It suggests a few things. So far I have not found much discussion of this in the bubble-press, but I really have not looked very hard.

    • Replies: @res
    @anon


    How do we know that is actually happening?
     
    The media reports are the primary source. But I have seen enough crazy real estate happenings lately (to some extent asking prices seem to have adjusted to the new inflated normal, so now you just see full asking price offers) that there must be something going on. And that seems a decent explanation.

    That seems to be the case. It suggests a few things. So far I have not found much discussion of this in the bubble-press, but I really have not looked very hard.
     
    I'd be interested in your further thoughts on this. I might be being dense, but I can't see how the end game works for them.

    Replies: @anon

  75. @RoatanBill
    @onebornfree

    If I were to cash out my PM holdings now, I'd be up a serious percentage in a relatively short time.

    You seem to emphasize 'immediate' in your inflation comment. I don't usually look at things short term. My premise is that sooner or later, currency printing eventually leads to inflation and in severe cases as in the US, hyperinflation. Last I heard, 20% of all US currency was created in the last year or so. The world is also sick of being sanctioned where the US Dollar and the SWIFT system are the actual weapons employed.

    I don't think anyone can rationalize away the trend towards US Dollar collapse any day now. It could take years but it's most likely to occur when a foreign entity decides to pull the plug on the Dollar and I'd bet that's real close. The US military is no longer considered the threat it once was and given the fact that the US's portion of world GDP is now a fraction of what it was after WW-II, the handwriting is on the wall if one wants to read it.

    Replies: @onebornfree, @Ralph B. Seymour

    “My premise is that sooner or later, currency printing eventually leads to inflation and in severe cases as in the US, hyperinflation.”

    Oh, I agree. But that does not mean that it will definitely happen during yours or my lifetimes

    “I don’t think anyone can rationalize away the trend towards US Dollar collapse any day now.”

    “Any day now” ? Doesn’t this contradict your previous comment above, or am I missing something?

    Regards, onebornfree
    http://onebornfreesfinancialsafetyreports.blogspot.com

  76. @dfordoom
    @SunBakedSuburb


    The removal of the “current corrupt elite” while necessary seems an impossible task. They and the leftist authoritarian system they preside over is protected by the civilian intelligence agencies.
     
    I mostly agree, although I'd say that the current system is not a leftist authoritarian system. It's just an authoritarian system. There's no genuine ideological basis to it. It's about naked power and it's about corruption, and it's about powerful corrupt people protecting their own interests.

    The ideological aspect to it is fake. It's window dressing. To the extent that there's any genuine ideological element to it the ideology is more fascist than leftist. Or perhaps it really is neo-feudalism.

    But you're correct in stating that the current system is protected by the civilian intelligence agencies and the military and they're not going to allow it to be overthrown. They will do whatever they think necessary to preserve the system, and they will be utterly ruthless about it.

    Replies: @SunBakedSuburb

    “neo-feudalism”

    Yes, definitely a more accurate term. Tyranny wears many masks; this one hides behind progressive causes — climate change, transhumanism — elites favor.

  77. @notanon
    @SunBakedSuburb


    The removal of the “current corrupt elite” while necessary seems an impossible task.
     
    maybe; maybe not

    imo although the people actually driving this have managed to stealth their way to the top of the chain of command i don't think there's a lot of them numerically (and the bulk of their minions are self-centered sociopaths, effectively mercenaries who'd change sides in an instant if the tide looked like it might be turning)

    so very difficult yes but maybe not impossible.

    Replies: @SunBakedSuburb, @V. K. Ovelund

    “I don’t think there’s a lot of them numerically”

    This is probably true in the military. The FBI/DOJ and CIA is another kettle of fish.

  78. @V. K. Ovelund
    @dfordoom

    The straw man has become a regular guest at this dinner table. We are getting to know him rather well.


    The idea that a dictator would be an improvement is dissident right cope, based on the delusion that somehow, magically, a dictator would be the kind of dictator that dissident rightists fantasise about.
     
    The only fantasy is that this were what the dissident right thinks.

    Replies: @V. K. Ovelund

    V. K. Ovelund says … • Agree: V. K. Ovelund

    I misclicked, but didn’t know that one could agree with one’s own comment.

    My last comment came across too sharp. I cannot deny that, in the past, you have written truth about the dissident right where I was in error. Nevertheless, I know more dissident rightists than most here do as far as I am aware, and I just do not know any that hold some of the opinions you have ascribed to them.

    You have said that you do not watch television and I believe you. However, I still suspect that some of the televised tropes are filtering through to you at second hand. You have no duty to watch any video I link: I assume that you have better things to do with your time. Notwithstanding, given that I have linked video counterexamples with no response from you, … well, it is a sign of the respect I bear for your judgment and intellect that the dissident-right caricature you propagate dismays me.

    • Replies: @Mario Partisan
    @V. K. Ovelund

    Don't be so hard on yourself, I tend to agree with myself too (but not always).

  79. anon[273] • Disclaimer says:
    @dfordoom
    @anon



    They’re like religious cults. Communist regimes are more practical. Communists are more interested in the nuts-and-bolts of politics.
     
    That’s why the Communist regimes of the 20th century never, ever had any sort of quasi-religious cult of personality, right?
     
    You've missed my point entirely. Communist regimes made use of personality cults because communists understood the usefulness of giving the masses something that would make them happy. It's a technique that has been used by monarchies (Louis XIV, the Tsarist regime in Russia, quasi-religious cults of emperors as in Japan and China, the deification of emperors in Imperial Rome). There were personality cults built around Elizabeth I and Queen Victoria. Liberal democracies make use of personality cults (the cult of Churchill, Lincoln, JFK, Trump). Right-wing dictatorships built personality cults around Franco, Mussolini and that Austrian painter chap.

    It's a cynical but useful means of keeping the masses happy and obedient.

    The important point is that while creating these personality cults to distract the masses the communists got on with the job of consolidating their power base by building bureaucracies and Party structures that would maintain their hold on power. They were good at that sort of thing because it appealed to them. They loved the nuts-and-bolts side of political power and they understood its importance. That's why such regimes were able to survive the deaths of the figures that those personality cults were built around. They had the structures in place to transfer power into new hands.

    The quasi-religious side of communist regimes was also built to a large extent around the Party itself, and around its ideology. Stalin could die but the cult of the Party and of Marxist-Leninism would go on. Mao could die but the cult of the Party would go on. Kim Il-sung could die but the cult of the Party would go on.

    I assume you're making the mistake of assuming that I'm advocating for communism. I'm not. I'm merely pointing out why communist regimes were surprisingly durable whereas right-wing dictatorships collapsed as soon as the original dictator died.

    Even if you disapprove of a particular political movement you can learn lesson from what that political movement did that worked.

    Replies: @anon

    You’ve missed my point entirely.

    Don’t think so.

    Communist regimes made use of personality cults because communists understood the usefulness of giving the masses something that would make them happy.

    Cult of personality was present from the very start in just about every 20th century Communist regime. This contradicts your handwavy claim. Various flavours of leftism rely on cult of personality. I doubt you will agree, but the facts are obvious nevertheless.

    The important point is that while creating these personality cults to distract the masses the communists got on with the job of consolidating their power base by building bureaucracies and Party structures that would maintain their hold on power.

    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.

    I assume you’re making the mistake of assuming that I’m advocating for communism.

    You would assume incorrectly, again.

    • Replies: @dfordoom
    @anon


    Cult of personality was present from the very start in just about every 20th century Communist regime. This contradicts your handwavy claim. Various flavours of leftism rely on cult of personality. I doubt you will agree, but the facts are obvious nevertheless.
     
    You're confusing the propaganda that regimes create with the reality of how those regimes actually work. All regimes make use of propaganda, and personality cults are just another propaganda tool. I gave examples of personality cults utilised by right-wing dictatorships, monarchies and liberal democracies so I think it's obvious that there's nothing peculiarly leftist about personality cults.

    Liberal democracies make massive use of propaganda as well. Surely you wouldn't make the mistake of believing that such propaganda reflects the reality of how those liberal democracies actually work.

    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.

     

    You don't think there was just a tiny bit of a personality cult built around Mussolini? Or the Austrian painter with the moustache?

    And Francoism (I use that term because Franco was very right-wing but was not really a fascist) did not survive Franco's death, which suggests that Francoism failed to consolidate.

    Can you give me an example of a right-wing dictatorship that actually did survive the death of the original leader?
    , @Triteleia Laxa
    @anon


    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.
     
    You don't think Franco and Mussolini built cults of personality around themselves? Even though neither regime survived the leader? Even though Mussolini is practically the textbook case-study in personality cults?

    If you want a right wing military regime without a cult of personality, you could pick Brazil in the 70s.


    This is only from Wikipedia, but it is extremely compelling.

    Franco:

    A cult of personality surrounded Francisco Franco during his regime. From the mid-1940s onward, after he proclaimed Spain a monarchy with himself as regent for life, he was depicted much like a king. He wore the uniform of a captain general (a rank traditionally reserved for the king) and resided in the royal Pardo Palace. He appropriated the kingly privilege of walking beneath a canopy, and his portrait appeared on most Spanish coins. Indeed, although his formal titles were Jefe del Estado (Head of State) and Generalísimo de los Ejércitos Españoles (Generalissimo of the Spanish Armed Forces), he was referred to as Caudillo de España por la gracia de Dios, (By the Grace of God, the Leader of Spain). Por la Gracia de Dios is a technical, legal formulation which states sovereign dignity in absolute monarchies, and it had only been used by monarchs before Franco used it himself.

    For almost four decades, schoolchildren were taught that Franco had been sent by Divine Providence to save Spain from chaos, atheism and poverty.

    Mussolini:

    The cult of Il Duce of fascist Italy Benito Mussolini was in many respects the unifying force of the Fascist regime, acting as a common denominator for various political groups and social classes in both the fascist party and the wider Italian society.

    A basic slogan proclaimed that Mussolini was always right (Italian: Il Duce ha sempre ragione). Endless publicity revolved around him. He was generally portrayed in a macho manner, although he could also appear as a Renaissance man, a military man, a family man, or even as a common man.

    This reflected his presentation as a universal man, expert in all subjects; a light was left on his office long after he was asleep as a part of fascist propaganda in order to present him as an insomniac owing to his driven to work nature.

    Mussolini himself oversaw which photographs could appear, rejecting some, for instance, because he was not sufficiently prominent in a group. Legends of Mussolini defying death during the First World War and surviving assassination attempts were circulated in order to give the dictator a mythical, immortal aura.

    In addition to depicting Mussolini as being chosen by God, the regime presented him as having omnipotent, godlike or superhuman powers.

    His image proclaimed that he had improved the Italian people morally, materially, and spiritually. Even before his seizure of power, he was proclaimed the Duce in song. The war on Ethiopia was presented as a revival of the Roman Empire, with Mussolini as Augustus.

    Replies: @anon

  80. @notanon
    @SunBakedSuburb


    The removal of the “current corrupt elite” while necessary seems an impossible task.
     
    maybe; maybe not

    imo although the people actually driving this have managed to stealth their way to the top of the chain of command i don't think there's a lot of them numerically (and the bulk of their minions are self-centered sociopaths, effectively mercenaries who'd change sides in an instant if the tide looked like it might be turning)

    so very difficult yes but maybe not impossible.

    Replies: @SunBakedSuburb, @V. K. Ovelund

    (The nonstandard capitalization is distracting.)

    imo although the people actually driving this have managed to stealth their way to the top of the chain of command i don’t think there’s a lot of them numerically (and the bulk of their minions are self-centered sociopaths, effectively mercenaries who’d change sides in an instant if the tide looked like it might be turning)

    You write as though you had served. My own service was decades ago (though I’ve a son in uniform now), yet my impression mirrors yours precisely.

    The best officers often could not get promoted past O-5: lt. colonel or naval commander. If they were really excellent and luck was with them, they might make O-6: colonel or naval captain. Apparently, political considerations tended to bar further progress for honest men—not always, but oftener than one would like.

    I was only an enlisted trooper, though. (My enlistment paid for college rather than the other way around.) Were you an officer?

    • Replies: @notanon
    @V. K. Ovelund


    You write as though you had served.
     
    by "chain of command" i meant more generally i.e. they're giving the orders to the politicians giving the orders

    but yes, like you say

    The best officers often could not get promoted past O-5:
     
    same with police, FBI, bureaucracy etc.
  81. @Intelligent Dasein

    Get used to the term “neo-feudalism”. It’s going to come up a lot in the coming years.
     
    It would be very unfortunate if that were the case. Contemporary Westerners, groomed by centuries of Whig-historical propaganda, have been taught to think of feudalism as some sort of horribly repressive system that trod down the common man and granted exorbitant privileges to the aristocracy. This is not at all true. Feudalism was a natural hierarchy of reciprocal rights and duties between classes that instantiated the real principles of social justice as taught by the Holy Catholic Church.

    It is precisely the principles embodied in feudalism---which was distributist in nature---that are needed to get us OUT of the current mess, and it would be a masterstroke of satanic deception if the great number of the people were prevented from recognizing this due to the name becoming misapplied with opprobrium to the very oligarchic excesses it had always fought against.

    Replies: @anon, @Twinkie

    Nostalgia for things that never really existed is not a good way to think about problems.

    It’s also not a plan.

    Walter Scott was not an historian, either.

  82. @RoatanBill
    @onebornfree

    If I were to cash out my PM holdings now, I'd be up a serious percentage in a relatively short time.

    You seem to emphasize 'immediate' in your inflation comment. I don't usually look at things short term. My premise is that sooner or later, currency printing eventually leads to inflation and in severe cases as in the US, hyperinflation. Last I heard, 20% of all US currency was created in the last year or so. The world is also sick of being sanctioned where the US Dollar and the SWIFT system are the actual weapons employed.

    I don't think anyone can rationalize away the trend towards US Dollar collapse any day now. It could take years but it's most likely to occur when a foreign entity decides to pull the plug on the Dollar and I'd bet that's real close. The US military is no longer considered the threat it once was and given the fact that the US's portion of world GDP is now a fraction of what it was after WW-II, the handwriting is on the wall if one wants to read it.

    Replies: @onebornfree, @Ralph B. Seymour

    I agree with all that, but what currency will people use?

    All currencies are being ruined.

    • Replies: @RoatanBill
    @Ralph B. Seymour

    The 'people', meaning the average unprepared individual, will be screwed. No shop keeper will accept fiat at some point unless there's a gun or its law equivalent pointed at his head. In a short time, not even the threat from the gov't will keep shelves stocked because you can't really get something from nothing once the chain of trust has been broken. Gold and silver won't be much use either initially.

    Barter, trading goods for goods or labor for goods will most likely return as it has everywhere the official 'money' failed.

    My goal is to be as self sufficient as possible and as far away from a major population center as possible. I moved to the Caribbean to avoid winter, not just because I hate the cold, but because sooner or later, the lack of heat will kill people in large numbers. I'm acclimated to the heat and regularly do metal work at near 100 degrees all day long.

    The amount of things I've purchased and installed over the years to make up for the infrastructure taken for granted in the US is something I never even considered before moving. I own water pumps, water storage tanks, generators, solar, batteries, inverters, pressure washers, huge propane tanks, 80 gal air compressor, numerous chest freezers, refrigerators, racks for dry goods storage, commercial vacuum packaging machine, etc, etc, etc. My father was a practical man and taught me what tools and hard work were for. I've got two 20' shipping containers full of tools. About the only things I can't repair myself are A/C & refrigeration systems because I just never got interested and don't own the needed tools. Carpentry, sheetrock work, concrete work, spray painting, plumbing, electrical (I'm an EE), welding (MIG, TIG, Stick) and much more I've done.

    The whole point is to not be part of the crowd that will be very needy. With the food on hand, my wife and I could go a year without shopping in a real emergency situation. Our TP supply would last 2 years. We won't have much need for 'money' when the SHTF.

    It's during the recovery phase when precious metals become valuable. People will sell things for hard money at steep discounts because its concentrated wealth, easily portable and is no one's liability. No one is going to trust a bank for decades and is why I think the banks are intended to disappear this time with an account at the Treasury or the Fed (same thing now) as THE account along with only digital currency to lock you in to peasant status.

    Replies: @Ralph B. Seymour

  83. @V. K. Ovelund
    @V. K. Ovelund


    V. K. Ovelund says ... • Agree: V. K. Ovelund
     
    I misclicked, but didn't know that one could agree with one's own comment.

    @dfordoom

    My last comment came across too sharp. I cannot deny that, in the past, you have written truth about the dissident right where I was in error. Nevertheless, I know more dissident rightists than most here do as far as I am aware, and I just do not know any that hold some of the opinions you have ascribed to them.

    You have said that you do not watch television and I believe you. However, I still suspect that some of the televised tropes are filtering through to you at second hand. You have no duty to watch any video I link: I assume that you have better things to do with your time. Notwithstanding, given that I have linked video counterexamples with no response from you, ... well, it is a sign of the respect I bear for your judgment and intellect that the dissident-right caricature you propagate dismays me.

    Replies: @Mario Partisan

    Don’t be so hard on yourself, I tend to agree with myself too (but not always).

    • Disagree: Mario Partisan
  84. @V. K. Ovelund
    @notanon

    (The nonstandard capitalization is distracting.)


    imo although the people actually driving this have managed to stealth their way to the top of the chain of command i don’t think there’s a lot of them numerically (and the bulk of their minions are self-centered sociopaths, effectively mercenaries who’d change sides in an instant if the tide looked like it might be turning)
     
    You write as though you had served. My own service was decades ago (though I've a son in uniform now), yet my impression mirrors yours precisely.

    The best officers often could not get promoted past O-5: lt. colonel or naval commander. If they were really excellent and luck was with them, they might make O-6: colonel or naval captain. Apparently, political considerations tended to bar further progress for honest men—not always, but oftener than one would like.

    I was only an enlisted trooper, though. (My enlistment paid for college rather than the other way around.) Were you an officer?

    Replies: @notanon

    You write as though you had served.

    by “chain of command” i meant more generally i.e. they’re giving the orders to the politicians giving the orders

    but yes, like you say

    The best officers often could not get promoted past O-5:

    same with police, FBI, bureaucracy etc.

  85. @Ralph B. Seymour
    @RoatanBill

    I agree with all that, but what currency will people use?

    All currencies are being ruined.

    Replies: @RoatanBill

    The ‘people’, meaning the average unprepared individual, will be screwed. No shop keeper will accept fiat at some point unless there’s a gun or its law equivalent pointed at his head. In a short time, not even the threat from the gov’t will keep shelves stocked because you can’t really get something from nothing once the chain of trust has been broken. Gold and silver won’t be much use either initially.

    Barter, trading goods for goods or labor for goods will most likely return as it has everywhere the official ‘money’ failed.

    My goal is to be as self sufficient as possible and as far away from a major population center as possible. I moved to the Caribbean to avoid winter, not just because I hate the cold, but because sooner or later, the lack of heat will kill people in large numbers. I’m acclimated to the heat and regularly do metal work at near 100 degrees all day long.

    The amount of things I’ve purchased and installed over the years to make up for the infrastructure taken for granted in the US is something I never even considered before moving. I own water pumps, water storage tanks, generators, solar, batteries, inverters, pressure washers, huge propane tanks, 80 gal air compressor, numerous chest freezers, refrigerators, racks for dry goods storage, commercial vacuum packaging machine, etc, etc, etc. My father was a practical man and taught me what tools and hard work were for. I’ve got two 20′ shipping containers full of tools. About the only things I can’t repair myself are A/C & refrigeration systems because I just never got interested and don’t own the needed tools. Carpentry, sheetrock work, concrete work, spray painting, plumbing, electrical (I’m an EE), welding (MIG, TIG, Stick) and much more I’ve done.

    The whole point is to not be part of the crowd that will be very needy. With the food on hand, my wife and I could go a year without shopping in a real emergency situation. Our TP supply would last 2 years. We won’t have much need for ‘money’ when the SHTF.

    It’s during the recovery phase when precious metals become valuable. People will sell things for hard money at steep discounts because its concentrated wealth, easily portable and is no one’s liability. No one is going to trust a bank for decades and is why I think the banks are intended to disappear this time with an account at the Treasury or the Fed (same thing now) as THE account along with only digital currency to lock you in to peasant status.

    • Replies: @Ralph B. Seymour
    @RoatanBill

    Understand and agree that makes sense. All the needy people will gladly adopt CBDC.

    What will happen to international trade?
    What will rich people trade in?
    Will Bitcoin survive the destruction?

    Replies: @RoatanBill

  86. I’ve been assuming Blackrock is going to use the house purchases to “integrate” Trump voting neighborhoods.

  87. @RoatanBill
    @Ralph B. Seymour

    The 'people', meaning the average unprepared individual, will be screwed. No shop keeper will accept fiat at some point unless there's a gun or its law equivalent pointed at his head. In a short time, not even the threat from the gov't will keep shelves stocked because you can't really get something from nothing once the chain of trust has been broken. Gold and silver won't be much use either initially.

    Barter, trading goods for goods or labor for goods will most likely return as it has everywhere the official 'money' failed.

    My goal is to be as self sufficient as possible and as far away from a major population center as possible. I moved to the Caribbean to avoid winter, not just because I hate the cold, but because sooner or later, the lack of heat will kill people in large numbers. I'm acclimated to the heat and regularly do metal work at near 100 degrees all day long.

    The amount of things I've purchased and installed over the years to make up for the infrastructure taken for granted in the US is something I never even considered before moving. I own water pumps, water storage tanks, generators, solar, batteries, inverters, pressure washers, huge propane tanks, 80 gal air compressor, numerous chest freezers, refrigerators, racks for dry goods storage, commercial vacuum packaging machine, etc, etc, etc. My father was a practical man and taught me what tools and hard work were for. I've got two 20' shipping containers full of tools. About the only things I can't repair myself are A/C & refrigeration systems because I just never got interested and don't own the needed tools. Carpentry, sheetrock work, concrete work, spray painting, plumbing, electrical (I'm an EE), welding (MIG, TIG, Stick) and much more I've done.

    The whole point is to not be part of the crowd that will be very needy. With the food on hand, my wife and I could go a year without shopping in a real emergency situation. Our TP supply would last 2 years. We won't have much need for 'money' when the SHTF.

    It's during the recovery phase when precious metals become valuable. People will sell things for hard money at steep discounts because its concentrated wealth, easily portable and is no one's liability. No one is going to trust a bank for decades and is why I think the banks are intended to disappear this time with an account at the Treasury or the Fed (same thing now) as THE account along with only digital currency to lock you in to peasant status.

    Replies: @Ralph B. Seymour

    Understand and agree that makes sense. All the needy people will gladly adopt CBDC.

    What will happen to international trade?
    What will rich people trade in?
    Will Bitcoin survive the destruction?

    • Replies: @RoatanBill
    @Ralph B. Seymour

    This will quickly involve the whole world because all gov'ts have allowed themselves to debase their currencies simultaneously with the US being the largest offender. That's the whole reason for a 'reset' and the CBDC push.

    All trading will stop because no one is going to accept the other guys junk paper. Gov't will get together and come up with a new scheme or at least attempt to. My bet is that they will once again opt for what has worked for thousands of years and that's commodities, especially gold and silver. I expect oil, uranium, copper and even food stuffs to enter the picture as payment option country to country to settle debts. Within a country, no aircraft manufacturer, for example, is going to accept corn for payment, so the gov't will convert that corn to some acceptable substitute. It's an arbitrage scheme.

    Some countries have been prepping for years if not decades. They've been hoarding gold. I expect the stronger industrial nations to agree on some commodity money scheme among themselves and once again produce shit currency inside their countries to once again screw their citizenry, but not as badly, by backing their currencies with commodities.

    Bitcoin is a nuisance and will reach its equivalent value in tulips.

  88. @anon
    @dfordoom

    You’ve missed my point entirely.

    Don't think so.

    Communist regimes made use of personality cults because communists understood the usefulness of giving the masses something that would make them happy.

    Cult of personality was present from the very start in just about every 20th century Communist regime. This contradicts your handwavy claim. Various flavours of leftism rely on cult of personality. I doubt you will agree, but the facts are obvious nevertheless.

    The important point is that while creating these personality cults to distract the masses the communists got on with the job of consolidating their power base by building bureaucracies and Party structures that would maintain their hold on power.

    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.

    I assume you’re making the mistake of assuming that I’m advocating for communism.

    You would assume incorrectly, again.

    Replies: @dfordoom, @Triteleia Laxa

    Cult of personality was present from the very start in just about every 20th century Communist regime. This contradicts your handwavy claim. Various flavours of leftism rely on cult of personality. I doubt you will agree, but the facts are obvious nevertheless.

    You’re confusing the propaganda that regimes create with the reality of how those regimes actually work. All regimes make use of propaganda, and personality cults are just another propaganda tool. I gave examples of personality cults utilised by right-wing dictatorships, monarchies and liberal democracies so I think it’s obvious that there’s nothing peculiarly leftist about personality cults.

    Liberal democracies make massive use of propaganda as well. Surely you wouldn’t make the mistake of believing that such propaganda reflects the reality of how those liberal democracies actually work.

    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.

    You don’t think there was just a tiny bit of a personality cult built around Mussolini? Or the Austrian painter with the moustache?

    And Francoism (I use that term because Franco was very right-wing but was not really a fascist) did not survive Franco’s death, which suggests that Francoism failed to consolidate.

    Can you give me an example of a right-wing dictatorship that actually did survive the death of the original leader?

  89. res says:
    @anon
    @res

    What I don’t understand is why Blackrock is paying 30% over asking.

    How do we know that is actually happening?

    It almost feels like an attempt at a market corner...

    That seems to be the case. It suggests a few things. So far I have not found much discussion of this in the bubble-press, but I really have not looked very hard.

    Replies: @res

    How do we know that is actually happening?

    The media reports are the primary source. But I have seen enough crazy real estate happenings lately (to some extent asking prices seem to have adjusted to the new inflated normal, so now you just see full asking price offers) that there must be something going on. And that seems a decent explanation.

    That seems to be the case. It suggests a few things. So far I have not found much discussion of this in the bubble-press, but I really have not looked very hard.

    I’d be interested in your further thoughts on this. I might be being dense, but I can’t see how the end game works for them.

    • Agree: V. K. Ovelund
    • Replies: @anon
    @res

    The media reports are the primary source

    Well, since the business media is infallible, I guess that settles it.

    But seriously, I will check with some local RE people, to see if this is bubbling here in flyover.

    I might be being dense, but I can’t see how the end game works for them.

    Real Estate (RE) has a physical resale value, and reliably throws off cash. That's how more than one millionaire made a fortune.

    Commercial RE took a hit during the Coof, with some commercial REITs still hurting.
    Residential RE came through the Coof just fine, for obvious reasons.

    Given effectively unlimited migration for the next N years, demand for residential RE won't subside, in fact it can't. Furthermore, the single family home is in some ways the sweet spot for residential RE; apartments have certain issues, vacation property prices can be more volatile, but any given single-family home can be sold in 30 to 60 days without much fuss. Often quicker than that.

    So BlackRock is clearly betting on a massive increase in the nominal (dollar) value of single family housing over the next business cycle, such that overpaying 20% or even 30% won't matter in the slightly longer run: the house will be rented or leased (cash flow) and towards the end of the cycle the house can be sold at break-even or more likely a profit.

    This suggests to me that BlackRock wants to diversify more widely than equities / debt instruments, and is willing to put up with some of the hassles of owning single-family residential RE as part of the price. The hassle include contracting with maintenance companies, possibly with landscapers, and probably a call center or two. But that overhead is quantifiable and predictable.

    This is not the same as back in 2006 when bartenders in Las Vegas would max out a credit card making minimum down payments on 2 or 3 newly built spec houses, fully anticipating flipping them in a matter of weeks. This is a serious, large scale buy. At a time when the Feds are trying to kill off some zoning laws nationwide, and in-fill townhouse / apartments have been constructed for years, the value of the single-family home can only increase, because demand likely will exceed supply.

    Just off the top of my head.

    Replies: @res

  90. anon[285] • Disclaimer says:
    @res
    @anon


    How do we know that is actually happening?
     
    The media reports are the primary source. But I have seen enough crazy real estate happenings lately (to some extent asking prices seem to have adjusted to the new inflated normal, so now you just see full asking price offers) that there must be something going on. And that seems a decent explanation.

    That seems to be the case. It suggests a few things. So far I have not found much discussion of this in the bubble-press, but I really have not looked very hard.
     
    I'd be interested in your further thoughts on this. I might be being dense, but I can't see how the end game works for them.

    Replies: @anon

    The media reports are the primary source

    Well, since the business media is infallible, I guess that settles it.

    But seriously, I will check with some local RE people, to see if this is bubbling here in flyover.

    I might be being dense, but I can’t see how the end game works for them.

    Real Estate (RE) has a physical resale value, and reliably throws off cash. That’s how more than one millionaire made a fortune.

    Commercial RE took a hit during the Coof, with some commercial REITs still hurting.
    Residential RE came through the Coof just fine, for obvious reasons.

    Given effectively unlimited migration for the next N years, demand for residential RE won’t subside, in fact it can’t. Furthermore, the single family home is in some ways the sweet spot for residential RE; apartments have certain issues, vacation property prices can be more volatile, but any given single-family home can be sold in 30 to 60 days without much fuss. Often quicker than that.

    So BlackRock is clearly betting on a massive increase in the nominal (dollar) value of single family housing over the next business cycle, such that overpaying 20% or even 30% won’t matter in the slightly longer run: the house will be rented or leased (cash flow) and towards the end of the cycle the house can be sold at break-even or more likely a profit.

    This suggests to me that BlackRock wants to diversify more widely than equities / debt instruments, and is willing to put up with some of the hassles of owning single-family residential RE as part of the price. The hassle include contracting with maintenance companies, possibly with landscapers, and probably a call center or two. But that overhead is quantifiable and predictable.

    This is not the same as back in 2006 when bartenders in Las Vegas would max out a credit card making minimum down payments on 2 or 3 newly built spec houses, fully anticipating flipping them in a matter of weeks. This is a serious, large scale buy. At a time when the Feds are trying to kill off some zoning laws nationwide, and in-fill townhouse / apartments have been constructed for years, the value of the single-family home can only increase, because demand likely will exceed supply.

    Just off the top of my head.

    • Replies: @res
    @anon

    Some good points. Thanks.


    This suggests to me that BlackRock wants to diversify more widely than equities / debt instruments
     
    Agreed. I think this says a lot about their perception of stock and bond valuations and risk.

    So BlackRock is clearly betting on a massive increase in the nominal (dollar) value of single family housing over the next business cycle, such that overpaying 20% or even 30% won’t matter in the slightly longer run: the house will be rented or leased (cash flow) and towards the end of the cycle the house can be sold at break-even or more likely a profit.
     
    That's the bet I don't understand. Maybe they are right, but it seems like a case of buying high and hoping it goes higher. At some point I start asking "who is buying these houses at these valuations?"

    The inflation hedge aspect makes much more sense to me, but even there overpaying hurts you. I wonder what time frames they are using to run their numbers and what proportion of the benefit is from nominal price increase vs. inflation hedge.

    but any given single-family home can be sold in 30 to 60 days without much fuss. Often quicker than that.
     
    Be careful with this one. May be true given a sufficiently low price (or hot market), but our economy has been skewed for a while now. Does anyone have historical data for days on market? I am having trouble finding it. This is the best I found (graphical and original sources), but it only goes back to July 2016.
    https://fred.stlouisfed.org/series/MEDDAYONMARUS
    https://www.realtor.com/research/data/

    (not sure this will embed)
    https://fred.stlouisfed.org/graph/fredgraph.png?g=EJiz

    Notice the frequent variation to 85+ days on the market. And that was during a relatively strong economic period in the US. The recent decline to 40 days is a significant outlier on the graph.

    P.S. I found this link topical and interesting.
    https://www.thesimpledollar.com/mortgage/history-of-the-housing-market-over-the-last-50-years/
    Here is an extremely detailed look at the SF Bay Area real estate market from 1980/2000 (range, different datasets) to the present.
    https://www.bayareamarketreports.com/trend/3-recessions-2-bubbles-and-a-baby

    Replies: @res

  91. @Intelligent Dasein

    Get used to the term “neo-feudalism”. It’s going to come up a lot in the coming years.
     
    It would be very unfortunate if that were the case. Contemporary Westerners, groomed by centuries of Whig-historical propaganda, have been taught to think of feudalism as some sort of horribly repressive system that trod down the common man and granted exorbitant privileges to the aristocracy. This is not at all true. Feudalism was a natural hierarchy of reciprocal rights and duties between classes that instantiated the real principles of social justice as taught by the Holy Catholic Church.

    It is precisely the principles embodied in feudalism---which was distributist in nature---that are needed to get us OUT of the current mess, and it would be a masterstroke of satanic deception if the great number of the people were prevented from recognizing this due to the name becoming misapplied with opprobrium to the very oligarchic excesses it had always fought against.

    Replies: @anon, @Twinkie

    It is precisely the principles embodied in feudalism—which was distributist in nature—that are needed to get us OUT of the current mess

    So would it be all right with you if I became a seignior and you a peasant under this marvelous scenario?

    I have a feeling you will be this kind of an argumentative peasant and I will have you repress you with the violence inherent in the system to shut you up.

  92. Food For Thought: What If Everyone Is Wrong About US Inflation’s Impact On Interest Rates?

    “What if everyone is wrong about US inflation’s impact on interest rates? I (Nick) have never seen a stronger consensus around a macroeconomic topic in my +30-year career in finance. Fed money printing plus fiscal stimulus/debt issuance plus economic reopening is supposed to equal high and likely lasting inflation. The 10-year Treasury will go to at least 2 percent and maybe 3 percent or higher. And you can’t swing the proverbial dead cat without hitting even direr warnings …But to paraphrase a bit of Yiddish wisdom: man plans, and markets laugh. ”

    From: https://www.zerohedge.com/markets/what-if-everyone-wrong-about-us-inflations-impact-interest-rates

    Regards, onebornfree

    • Replies: @Intelligent Dasein
    @onebornfree

    Yes, this is the truth of it.

    There will be inflation in the short term, but just like the 2008 oil price spike, it will cause the whole system to seize once it starts impacting commodities. And since most of the "inflation" exists only in the notional values of things like stocks and real estate, the selloff ends up "unprinting" those Fed dollars even faster than the Fed can print them.

    And they will not be able to reflate the rising the dollar by just printing to the Moon like Zimbabwe. Hyperinflation is not possible for the international reserve currency. Rather, the desperate search for any kind of real, valuable collateral forces Eurodollars to be heavily bid. We are structurally locked into a strong dollar policy no matter what the Fed does, which is why their money printing is all the more reckless. It isn't merely unsound, it's also futile.

    The Eurodollar system is the real dollar, while the Fedbux printed for domestic political reasons are a sideshow. The two are not the same thing even though they happen to have the same name. The rest of the world will end up forcing some market discipline on the US and we will finally have to abandon "too big to fail."

  93. @Ralph B. Seymour
    @RoatanBill

    Understand and agree that makes sense. All the needy people will gladly adopt CBDC.

    What will happen to international trade?
    What will rich people trade in?
    Will Bitcoin survive the destruction?

    Replies: @RoatanBill

    This will quickly involve the whole world because all gov’ts have allowed themselves to debase their currencies simultaneously with the US being the largest offender. That’s the whole reason for a ‘reset’ and the CBDC push.

    All trading will stop because no one is going to accept the other guys junk paper. Gov’t will get together and come up with a new scheme or at least attempt to. My bet is that they will once again opt for what has worked for thousands of years and that’s commodities, especially gold and silver. I expect oil, uranium, copper and even food stuffs to enter the picture as payment option country to country to settle debts. Within a country, no aircraft manufacturer, for example, is going to accept corn for payment, so the gov’t will convert that corn to some acceptable substitute. It’s an arbitrage scheme.

    Some countries have been prepping for years if not decades. They’ve been hoarding gold. I expect the stronger industrial nations to agree on some commodity money scheme among themselves and once again produce shit currency inside their countries to once again screw their citizenry, but not as badly, by backing their currencies with commodities.

    Bitcoin is a nuisance and will reach its equivalent value in tulips.

  94. res says:
    @anon
    @res

    The media reports are the primary source

    Well, since the business media is infallible, I guess that settles it.

    But seriously, I will check with some local RE people, to see if this is bubbling here in flyover.

    I might be being dense, but I can’t see how the end game works for them.

    Real Estate (RE) has a physical resale value, and reliably throws off cash. That's how more than one millionaire made a fortune.

    Commercial RE took a hit during the Coof, with some commercial REITs still hurting.
    Residential RE came through the Coof just fine, for obvious reasons.

    Given effectively unlimited migration for the next N years, demand for residential RE won't subside, in fact it can't. Furthermore, the single family home is in some ways the sweet spot for residential RE; apartments have certain issues, vacation property prices can be more volatile, but any given single-family home can be sold in 30 to 60 days without much fuss. Often quicker than that.

    So BlackRock is clearly betting on a massive increase in the nominal (dollar) value of single family housing over the next business cycle, such that overpaying 20% or even 30% won't matter in the slightly longer run: the house will be rented or leased (cash flow) and towards the end of the cycle the house can be sold at break-even or more likely a profit.

    This suggests to me that BlackRock wants to diversify more widely than equities / debt instruments, and is willing to put up with some of the hassles of owning single-family residential RE as part of the price. The hassle include contracting with maintenance companies, possibly with landscapers, and probably a call center or two. But that overhead is quantifiable and predictable.

    This is not the same as back in 2006 when bartenders in Las Vegas would max out a credit card making minimum down payments on 2 or 3 newly built spec houses, fully anticipating flipping them in a matter of weeks. This is a serious, large scale buy. At a time when the Feds are trying to kill off some zoning laws nationwide, and in-fill townhouse / apartments have been constructed for years, the value of the single-family home can only increase, because demand likely will exceed supply.

    Just off the top of my head.

    Replies: @res

    Some good points. Thanks.

    This suggests to me that BlackRock wants to diversify more widely than equities / debt instruments

    Agreed. I think this says a lot about their perception of stock and bond valuations and risk.

    So BlackRock is clearly betting on a massive increase in the nominal (dollar) value of single family housing over the next business cycle, such that overpaying 20% or even 30% won’t matter in the slightly longer run: the house will be rented or leased (cash flow) and towards the end of the cycle the house can be sold at break-even or more likely a profit.

    That’s the bet I don’t understand. Maybe they are right, but it seems like a case of buying high and hoping it goes higher. At some point I start asking “who is buying these houses at these valuations?”

    The inflation hedge aspect makes much more sense to me, but even there overpaying hurts you. I wonder what time frames they are using to run their numbers and what proportion of the benefit is from nominal price increase vs. inflation hedge.

    but any given single-family home can be sold in 30 to 60 days without much fuss. Often quicker than that.

    Be careful with this one. May be true given a sufficiently low price (or hot market), but our economy has been skewed for a while now. Does anyone have historical data for days on market? I am having trouble finding it. This is the best I found (graphical and original sources), but it only goes back to July 2016.
    https://fred.stlouisfed.org/series/MEDDAYONMARUS
    https://www.realtor.com/research/data/

    (not sure this will embed)

    Notice the frequent variation to 85+ days on the market. And that was during a relatively strong economic period in the US. The recent decline to 40 days is a significant outlier on the graph.

    P.S. I found this link topical and interesting.
    https://www.thesimpledollar.com/mortgage/history-of-the-housing-market-over-the-last-50-years/
    Here is an extremely detailed look at the SF Bay Area real estate market from 1980/2000 (range, different datasets) to the present.
    https://www.bayareamarketreports.com/trend/3-recessions-2-bubbles-and-a-baby

    • Thanks: V. K. Ovelund
    • Replies: @res
    @res

    Worth noting that the median days on market above is defined as:


    The median number of days property listings spend on the market in a given geography during the specified month (calculated from list date to closing, pending, or off-market date depending on data availability).
     
    Another definition:
    https://www.opendoor.com/w/blog/why-days-on-market-matter

    The National Association of Realtors defines DOM as the number of days from the date on which the property is listed for sale on the local brokers’ multiple-listing services (MLS) to the date when the seller has signed a contract for the sale of the property.
     
    I have no idea of the relative frequency of "closing, pending, or off-market date" in the data.

    To my understanding a typical closing takes about a month (accepted offer to title transfer, Zillow says 30-45 days). Not sure if your 30-60 days means time to closing or time to accepted offer.

    Which definition to use makes a big difference when interpreting a DOM of 40 days.

    Replies: @anon

  95. @anon
    @dfordoom

    You’ve missed my point entirely.

    Don't think so.

    Communist regimes made use of personality cults because communists understood the usefulness of giving the masses something that would make them happy.

    Cult of personality was present from the very start in just about every 20th century Communist regime. This contradicts your handwavy claim. Various flavours of leftism rely on cult of personality. I doubt you will agree, but the facts are obvious nevertheless.

    The important point is that while creating these personality cults to distract the masses the communists got on with the job of consolidating their power base by building bureaucracies and Party structures that would maintain their hold on power.

    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.

    I assume you’re making the mistake of assuming that I’m advocating for communism.

    You would assume incorrectly, again.

    Replies: @dfordoom, @Triteleia Laxa

    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.

    You don’t think Franco and Mussolini built cults of personality around themselves? Even though neither regime survived the leader? Even though Mussolini is practically the textbook case-study in personality cults?

    If you want a right wing military regime without a cult of personality, you could pick Brazil in the 70s.

    [MORE]

    This is only from Wikipedia, but it is extremely compelling.

    Franco:

    A cult of personality surrounded Francisco Franco during his regime. From the mid-1940s onward, after he proclaimed Spain a monarchy with himself as regent for life, he was depicted much like a king. He wore the uniform of a captain general (a rank traditionally reserved for the king) and resided in the royal Pardo Palace. He appropriated the kingly privilege of walking beneath a canopy, and his portrait appeared on most Spanish coins. Indeed, although his formal titles were Jefe del Estado (Head of State) and Generalísimo de los Ejércitos Españoles (Generalissimo of the Spanish Armed Forces), he was referred to as Caudillo de España por la gracia de Dios, (By the Grace of God, the Leader of Spain). Por la Gracia de Dios is a technical, legal formulation which states sovereign dignity in absolute monarchies, and it had only been used by monarchs before Franco used it himself.

    For almost four decades, schoolchildren were taught that Franco had been sent by Divine Providence to save Spain from chaos, atheism and poverty.

    Mussolini:

    The cult of Il Duce of fascist Italy Benito Mussolini was in many respects the unifying force of the Fascist regime, acting as a common denominator for various political groups and social classes in both the fascist party and the wider Italian society.

    A basic slogan proclaimed that Mussolini was always right (Italian: Il Duce ha sempre ragione). Endless publicity revolved around him. He was generally portrayed in a macho manner, although he could also appear as a Renaissance man, a military man, a family man, or even as a common man.

    This reflected his presentation as a universal man, expert in all subjects; a light was left on his office long after he was asleep as a part of fascist propaganda in order to present him as an insomniac owing to his driven to work nature.

    Mussolini himself oversaw which photographs could appear, rejecting some, for instance, because he was not sufficiently prominent in a group. Legends of Mussolini defying death during the First World War and surviving assassination attempts were circulated in order to give the dictator a mythical, immortal aura.

    In addition to depicting Mussolini as being chosen by God, the regime presented him as having omnipotent, godlike or superhuman powers.

    His image proclaimed that he had improved the Italian people morally, materially, and spiritually. Even before his seizure of power, he was proclaimed the Duce in song. The war on Ethiopia was presented as a revival of the Roman Empire, with Mussolini as Augustus.

    • Replies: @anon
    @Triteleia Laxa

    You don’t think Franco and Mussolini built cults of personality around themselves?

    Not to the extent of Communist regimes such as Stalin, Mao, etc.

    Even though neither regime survived the leader?

    What does that have to do with anything?

    Even though Mussolini is practically the textbook case-study in personality cults?

    Which textbook would that be?

    As recently as the 1970's there were claims from the PRC of some peasant farmer getting better crop yields from those fields where he read aloud nightly from the Little Red Book of Great Helmsman Mao. That kind of magical thinking is an axiomatic example of the cult of personality. It probably made Jim Jones envious.

    It's just a fact that every Communist regime in the 20th century was a cult of personality from the start. Probably the idea of a inerrant regime all but requires an inerrant leader, and thus cult of personality is inevitable. No doubt the idea of every Communist regime as a cult bothers you, as it obviously bothers dfordoom, but the facts don't care about your feelings.

    Franco in Spain and Peron in Argentina arguably had similar grips on their country, yet their regimes did not really survive them, probably because Spaniards and Argentinians could hear radio, read publications and view films from other countries. A Spaniard could ride the train into France and then Italy without much trouble, for example. Comparing the dictator to other countries obviously worked to tarnish the propaganda.

    Compare that with the closed USSR and PRC, where it was a crime to listen to radio from outside the country, where writers were closely watched, typewriters were controlled, etc. Even so it is notable that Nikita Khruschev was never able to attain the wall-to-wall cult status of Staln. The same is true in the PRC, where no one has yet matched Mao in sheer cult status.

    It is obvious that the cult of personality doesn't perform as well when competing information exists. Spain and Argentina were not closed societies, unlike the Warsaw Pact, DPRK, China, etc. Oh and as for Mussolini, there were some events in 1943 that affected his prestige, you may have heard of them?

    All of this is moot, of course. One might as well argue about ancient Crete - the past is past.

    Scrolling back up the thread, I see that this subthread started when dfordoom responded to a childish and foolish statement by Twinkie about "A Franco". This kind of historical ignorance is all too typical in comment boxes across the web, unfortunately.

    Here is a morsel of history...the siege of the Alcazar is a kind of microcosm of the civil war in Spain. This article is well written and accurately references one of the books I have on my shelves, the work by Geoffrey McNeill-Moss.

    https://almostchosenpeople.wordpress.com/2021/05/25/the-siege-of-the-alcazar/

    The Spanish civil war was a huge tragedy. No sane person would wish for such a crisis.

    Replies: @dfordoom

  96. res says:
    @res
    @anon

    Some good points. Thanks.


    This suggests to me that BlackRock wants to diversify more widely than equities / debt instruments
     
    Agreed. I think this says a lot about their perception of stock and bond valuations and risk.

    So BlackRock is clearly betting on a massive increase in the nominal (dollar) value of single family housing over the next business cycle, such that overpaying 20% or even 30% won’t matter in the slightly longer run: the house will be rented or leased (cash flow) and towards the end of the cycle the house can be sold at break-even or more likely a profit.
     
    That's the bet I don't understand. Maybe they are right, but it seems like a case of buying high and hoping it goes higher. At some point I start asking "who is buying these houses at these valuations?"

    The inflation hedge aspect makes much more sense to me, but even there overpaying hurts you. I wonder what time frames they are using to run their numbers and what proportion of the benefit is from nominal price increase vs. inflation hedge.

    but any given single-family home can be sold in 30 to 60 days without much fuss. Often quicker than that.
     
    Be careful with this one. May be true given a sufficiently low price (or hot market), but our economy has been skewed for a while now. Does anyone have historical data for days on market? I am having trouble finding it. This is the best I found (graphical and original sources), but it only goes back to July 2016.
    https://fred.stlouisfed.org/series/MEDDAYONMARUS
    https://www.realtor.com/research/data/

    (not sure this will embed)
    https://fred.stlouisfed.org/graph/fredgraph.png?g=EJiz

    Notice the frequent variation to 85+ days on the market. And that was during a relatively strong economic period in the US. The recent decline to 40 days is a significant outlier on the graph.

    P.S. I found this link topical and interesting.
    https://www.thesimpledollar.com/mortgage/history-of-the-housing-market-over-the-last-50-years/
    Here is an extremely detailed look at the SF Bay Area real estate market from 1980/2000 (range, different datasets) to the present.
    https://www.bayareamarketreports.com/trend/3-recessions-2-bubbles-and-a-baby

    Replies: @res

    Worth noting that the median days on market above is defined as:

    The median number of days property listings spend on the market in a given geography during the specified month (calculated from list date to closing, pending, or off-market date depending on data availability).

    Another definition:
    https://www.opendoor.com/w/blog/why-days-on-market-matter

    The National Association of Realtors defines DOM as the number of days from the date on which the property is listed for sale on the local brokers’ multiple-listing services (MLS) to the date when the seller has signed a contract for the sale of the property.

    I have no idea of the relative frequency of “closing, pending, or off-market date” in the data.

    To my understanding a typical closing takes about a month (accepted offer to title transfer, Zillow says 30-45 days). Not sure if your 30-60 days means time to closing or time to accepted offer.

    Which definition to use makes a big difference when interpreting a DOM of 40 days.

    • Replies: @anon
    @res

    That’s the bet I don’t understand. Maybe they are right, but it seems like a case of buying high and hoping it goes higher. At some point I start asking “who is buying these houses at these valuations?”

    To repeat myself, they obviously expect continuous demand due to essentially unlimited immigration, and Blackrock is not going into the speculative world of house-flipping like some Vegas bartender in 2006. They expect high demand for years to come. Thus they anticipate real time cash flow from those RE properties, plus an increase in the nominal and real price of the RE they are buying. Like buying an equity with a 5% dividend that is in a long term bull market.

    As for resale...look at the diagram you posted, examine the far right edge. How long does it take to clear a house title in the current year? IF demand is effectively unconstrained due to endless immigration, what do you expect to continue to see at the right edge next year? That may well be the "new normal".

    IMO Blackrock is reading the Biden administration's actual policies and extrapolating to an endless wave of immigration that will require an endless wave of RE construction. Will it end? Sure, trees do not grow to the sky, but then no fund like Blackrock ever gets "married" to an equity position, either. They are buying single family homes to make money both in the short term and the longer term, and this plan should work no matter what nominal inflation numbers show up.

    Did you look at the link up thread from 3 years back about Blackrock and Vanguard? It is easy reading and well worth your time.

    Replies: @res

  97. anon[402] • Disclaimer says:
    @Triteleia Laxa
    @anon


    Fascist Italy and Francoist Spain consolidated pretty much the same way, but without the cult of personality so important to Communist regimes.
     
    You don't think Franco and Mussolini built cults of personality around themselves? Even though neither regime survived the leader? Even though Mussolini is practically the textbook case-study in personality cults?

    If you want a right wing military regime without a cult of personality, you could pick Brazil in the 70s.


    This is only from Wikipedia, but it is extremely compelling.

    Franco:

    A cult of personality surrounded Francisco Franco during his regime. From the mid-1940s onward, after he proclaimed Spain a monarchy with himself as regent for life, he was depicted much like a king. He wore the uniform of a captain general (a rank traditionally reserved for the king) and resided in the royal Pardo Palace. He appropriated the kingly privilege of walking beneath a canopy, and his portrait appeared on most Spanish coins. Indeed, although his formal titles were Jefe del Estado (Head of State) and Generalísimo de los Ejércitos Españoles (Generalissimo of the Spanish Armed Forces), he was referred to as Caudillo de España por la gracia de Dios, (By the Grace of God, the Leader of Spain). Por la Gracia de Dios is a technical, legal formulation which states sovereign dignity in absolute monarchies, and it had only been used by monarchs before Franco used it himself.

    For almost four decades, schoolchildren were taught that Franco had been sent by Divine Providence to save Spain from chaos, atheism and poverty.

    Mussolini:

    The cult of Il Duce of fascist Italy Benito Mussolini was in many respects the unifying force of the Fascist regime, acting as a common denominator for various political groups and social classes in both the fascist party and the wider Italian society.

    A basic slogan proclaimed that Mussolini was always right (Italian: Il Duce ha sempre ragione). Endless publicity revolved around him. He was generally portrayed in a macho manner, although he could also appear as a Renaissance man, a military man, a family man, or even as a common man.

    This reflected his presentation as a universal man, expert in all subjects; a light was left on his office long after he was asleep as a part of fascist propaganda in order to present him as an insomniac owing to his driven to work nature.

    Mussolini himself oversaw which photographs could appear, rejecting some, for instance, because he was not sufficiently prominent in a group. Legends of Mussolini defying death during the First World War and surviving assassination attempts were circulated in order to give the dictator a mythical, immortal aura.

    In addition to depicting Mussolini as being chosen by God, the regime presented him as having omnipotent, godlike or superhuman powers.

    His image proclaimed that he had improved the Italian people morally, materially, and spiritually. Even before his seizure of power, he was proclaimed the Duce in song. The war on Ethiopia was presented as a revival of the Roman Empire, with Mussolini as Augustus.

    Replies: @anon

    You don’t think Franco and Mussolini built cults of personality around themselves?

    Not to the extent of Communist regimes such as Stalin, Mao, etc.

    Even though neither regime survived the leader?

    What does that have to do with anything?

    Even though Mussolini is practically the textbook case-study in personality cults?

    Which textbook would that be?

    As recently as the 1970’s there were claims from the PRC of some peasant farmer getting better crop yields from those fields where he read aloud nightly from the Little Red Book of Great Helmsman Mao. That kind of magical thinking is an axiomatic example of the cult of personality. It probably made Jim Jones envious.

    It’s just a fact that every Communist regime in the 20th century was a cult of personality from the start. Probably the idea of a inerrant regime all but requires an inerrant leader, and thus cult of personality is inevitable. No doubt the idea of every Communist regime as a cult bothers you, as it obviously bothers dfordoom, but the facts don’t care about your feelings.

    Franco in Spain and Peron in Argentina arguably had similar grips on their country, yet their regimes did not really survive them, probably because Spaniards and Argentinians could hear radio, read publications and view films from other countries. A Spaniard could ride the train into France and then Italy without much trouble, for example. Comparing the dictator to other countries obviously worked to tarnish the propaganda.

    Compare that with the closed USSR and PRC, where it was a crime to listen to radio from outside the country, where writers were closely watched, typewriters were controlled, etc. Even so it is notable that Nikita Khruschev was never able to attain the wall-to-wall cult status of Staln. The same is true in the PRC, where no one has yet matched Mao in sheer cult status.

    It is obvious that the cult of personality doesn’t perform as well when competing information exists. Spain and Argentina were not closed societies, unlike the Warsaw Pact, DPRK, China, etc. Oh and as for Mussolini, there were some events in 1943 that affected his prestige, you may have heard of them?

    All of this is moot, of course. One might as well argue about ancient Crete – the past is past.

    Scrolling back up the thread, I see that this subthread started when dfordoom responded to a childish and foolish statement by Twinkie about “A Franco”. This kind of historical ignorance is all too typical in comment boxes across the web, unfortunately.

    Here is a morsel of history…the siege of the Alcazar is a kind of microcosm of the civil war in Spain. This article is well written and accurately references one of the books I have on my shelves, the work by Geoffrey McNeill-Moss.

    https://almostchosenpeople.wordpress.com/2021/05/25/the-siege-of-the-alcazar/

    The Spanish civil war was a huge tragedy. No sane person would wish for such a crisis.

    • Replies: @dfordoom
    @anon


    Scrolling back up the thread, I see that this subthread started when dfordoom responded to a childish and foolish statement by Twinkie about “A Franco”.
     
    Yes. And I pointed out that wishing for a right-wing dictator was foolish because there is overwhelming historical evidence that right-wing dictatorships always fail because for some reason they are short-lived and do not survive the deaths of the original dictator.

    I also pointed out that for some reason communist dictatorships usually do survive the deaths of the original dictator. Which again is a historical fact.

    The explanation I offered was that communists were clearly better at establishing long-lasting power structures, which I felt suggested that communists must obviously have a more practical approach to the problem of consolidating and maintaining their grip on power.

    Those who have argued against my contentions have done so by simply ignoring the facts of history, because they find historical facts unpleasant.

    The arguments about personality cults are irrelevant because regimes across the entire political spectrum have created personality cults. Obviously the reason that communist dictatorships have been more long-lived than right-wing dictatorships has nothing to do with personality cults.

    Replies: @anon

  98. anon[386] • Disclaimer says:
    @res
    @res

    Worth noting that the median days on market above is defined as:


    The median number of days property listings spend on the market in a given geography during the specified month (calculated from list date to closing, pending, or off-market date depending on data availability).
     
    Another definition:
    https://www.opendoor.com/w/blog/why-days-on-market-matter

    The National Association of Realtors defines DOM as the number of days from the date on which the property is listed for sale on the local brokers’ multiple-listing services (MLS) to the date when the seller has signed a contract for the sale of the property.
     
    I have no idea of the relative frequency of "closing, pending, or off-market date" in the data.

    To my understanding a typical closing takes about a month (accepted offer to title transfer, Zillow says 30-45 days). Not sure if your 30-60 days means time to closing or time to accepted offer.

    Which definition to use makes a big difference when interpreting a DOM of 40 days.

    Replies: @anon

    That’s the bet I don’t understand. Maybe they are right, but it seems like a case of buying high and hoping it goes higher. At some point I start asking “who is buying these houses at these valuations?”

    To repeat myself, they obviously expect continuous demand due to essentially unlimited immigration, and Blackrock is not going into the speculative world of house-flipping like some Vegas bartender in 2006. They expect high demand for years to come. Thus they anticipate real time cash flow from those RE properties, plus an increase in the nominal and real price of the RE they are buying. Like buying an equity with a 5% dividend that is in a long term bull market.

    As for resale…look at the diagram you posted, examine the far right edge. How long does it take to clear a house title in the current year? IF demand is effectively unconstrained due to endless immigration, what do you expect to continue to see at the right edge next year? That may well be the “new normal”.

    IMO Blackrock is reading the Biden administration’s actual policies and extrapolating to an endless wave of immigration that will require an endless wave of RE construction. Will it end? Sure, trees do not grow to the sky, but then no fund like Blackrock ever gets “married” to an equity position, either. They are buying single family homes to make money both in the short term and the longer term, and this plan should work no matter what nominal inflation numbers show up.

    Did you look at the link up thread from 3 years back about Blackrock and Vanguard? It is easy reading and well worth your time.

    • Replies: @res
    @anon


    To repeat myself
     
    Understood, but to repeat myself: “who is buying these houses at these valuations?” When I say that I mean who will BlackRock sell to? Remember that these are single family houses. Though one way out (one of Alden's hobby horses) is immigrants living 20 to a house (or even just say 3-4 people each earning a decent wage).

    FWIW, I was having conversations like this about CA real estate circa 2006. And about internet stocks circa 2000. Have you lived through any bear markets following bubbles? The degree of optimistic rationalization to be seen during bubbles is something to behold. I think it is actually one of the best diagnostic indicators.


    As for resale…look at the diagram you posted, examine the far right edge. How long does it take to clear a house title in the current year? IF demand is effectively unconstrained due to endless immigration, what do you expect to continue to see at the right edge next year? That may well be the “new normal”.
     
    Sounds like Irving Fisher with his “Stock prices have reached what looks like a permanently high plateau.”
    https://time.com/3207128/stock-market-high-1929/

    Look, you may be right. BlackRock placing this large a bet makes it likely you will be for a while. But as I said, I don't see the endgame. Try running the numbers for what sort of income is needed to purchase houses at these prices if interest rates go up even a few percent.


    Did you look at the link up thread from 3 years back about Blackrock and Vanguard? It is easy reading and well worth your time.
     
    Thanks. Here it is again to save people searching.
    https://financialpost.com/investing/a-20-trillion-blackrock-vanguard-duopoly-is-investings-future

    Replies: @anon

  99. @onebornfree
    Food For Thought: What If Everyone Is Wrong About US Inflation's Impact On Interest Rates?

    "What if everyone is wrong about US inflation’s impact on interest rates? I (Nick) have never seen a stronger consensus around a macroeconomic topic in my +30-year career in finance. Fed money printing plus fiscal stimulus/debt issuance plus economic reopening is supposed to equal high and likely lasting inflation. The 10-year Treasury will go to at least 2 percent and maybe 3 percent or higher. And you can’t swing the proverbial dead cat without hitting even direr warnings …But to paraphrase a bit of Yiddish wisdom: man plans, and markets laugh. "

    From: https://www.zerohedge.com/markets/what-if-everyone-wrong-about-us-inflations-impact-interest-rates

    Regards, onebornfree

    Replies: @Intelligent Dasein

    Yes, this is the truth of it.

    There will be inflation in the short term, but just like the 2008 oil price spike, it will cause the whole system to seize once it starts impacting commodities. And since most of the “inflation” exists only in the notional values of things like stocks and real estate, the selloff ends up “unprinting” those Fed dollars even faster than the Fed can print them.

    And they will not be able to reflate the rising the dollar by just printing to the Moon like Zimbabwe. Hyperinflation is not possible for the international reserve currency. Rather, the desperate search for any kind of real, valuable collateral forces Eurodollars to be heavily bid. We are structurally locked into a strong dollar policy no matter what the Fed does, which is why their money printing is all the more reckless. It isn’t merely unsound, it’s also futile.

    The Eurodollar system is the real dollar, while the Fedbux printed for domestic political reasons are a sideshow. The two are not the same thing even though they happen to have the same name. The rest of the world will end up forcing some market discipline on the US and we will finally have to abandon “too big to fail.”

  100. res says:
    @anon
    @res

    That’s the bet I don’t understand. Maybe they are right, but it seems like a case of buying high and hoping it goes higher. At some point I start asking “who is buying these houses at these valuations?”

    To repeat myself, they obviously expect continuous demand due to essentially unlimited immigration, and Blackrock is not going into the speculative world of house-flipping like some Vegas bartender in 2006. They expect high demand for years to come. Thus they anticipate real time cash flow from those RE properties, plus an increase in the nominal and real price of the RE they are buying. Like buying an equity with a 5% dividend that is in a long term bull market.

    As for resale...look at the diagram you posted, examine the far right edge. How long does it take to clear a house title in the current year? IF demand is effectively unconstrained due to endless immigration, what do you expect to continue to see at the right edge next year? That may well be the "new normal".

    IMO Blackrock is reading the Biden administration's actual policies and extrapolating to an endless wave of immigration that will require an endless wave of RE construction. Will it end? Sure, trees do not grow to the sky, but then no fund like Blackrock ever gets "married" to an equity position, either. They are buying single family homes to make money both in the short term and the longer term, and this plan should work no matter what nominal inflation numbers show up.

    Did you look at the link up thread from 3 years back about Blackrock and Vanguard? It is easy reading and well worth your time.

    Replies: @res

    To repeat myself

    Understood, but to repeat myself: “who is buying these houses at these valuations?” When I say that I mean who will BlackRock sell to? Remember that these are single family houses. Though one way out (one of Alden’s hobby horses) is immigrants living 20 to a house (or even just say 3-4 people each earning a decent wage).

    FWIW, I was having conversations like this about CA real estate circa 2006. And about internet stocks circa 2000. Have you lived through any bear markets following bubbles? The degree of optimistic rationalization to be seen during bubbles is something to behold. I think it is actually one of the best diagnostic indicators.

    As for resale…look at the diagram you posted, examine the far right edge. How long does it take to clear a house title in the current year? IF demand is effectively unconstrained due to endless immigration, what do you expect to continue to see at the right edge next year? That may well be the “new normal”.

    Sounds like Irving Fisher with his “Stock prices have reached what looks like a permanently high plateau.”
    https://time.com/3207128/stock-market-high-1929/

    Look, you may be right. BlackRock placing this large a bet makes it likely you will be for a while. But as I said, I don’t see the endgame. Try running the numbers for what sort of income is needed to purchase houses at these prices if interest rates go up even a few percent.

    Did you look at the link up thread from 3 years back about Blackrock and Vanguard? It is easy reading and well worth your time.

    Thanks. Here it is again to save people searching.
    https://financialpost.com/investing/a-20-trillion-blackrock-vanguard-duopoly-is-investings-future

    • Replies: @anon
    @res

    Understood, but to repeat myself: “who is buying these houses at these valuations?” When I say that I mean who will BlackRock sell to? Remember that these are single family houses.

    For the third time:


    To repeat myself, they obviously expect continuous demand due to essentially unlimited immigration, and Blackrock is not going into the speculative world of house-flipping like some Vegas bartender in 2006. They expect high demand for years to come.
     
    Though one way out (one of Alden’s hobby horses) is immigrants living 20 to a house (or even just say 3-4 people each earning a decent wage).

    What is "white flight"? Why would people decide 3 to 5 years from now to sell their current house and move to a newer, nicer one, and be willing to pay Blackrock for it? There's a ripple effect that can be seen in many cities that could be driven by unlimited immigration. Must I spell it out for you?

    FWIW, I was having conversations like this about CA real estate circa 2006.

    It is very early in this particular housing market.

    And about internet stocks circa 2000. Have you lived through any bear markets following bubbles?

    C'mon, man read between some lines once in while. How do you suppose I know what bartenders and blackjack dealers were doing in Vegas to flip houses in 2006? Or what the house repo world looked like in the Inland Empire by 2007?

    Look, you may be right. BlackRock placing this large a bet makes it likely you will be for a while. But as I said, I don’t see the endgame. Try running the numbers for what sort of income is needed to purchase houses at these prices if interest rates go up even a few percent.

    The fact that you don't see the endgame does not prove that there isn't one. OTOH, it is possible Blackrock may "see" something that isn't really there. Charles MacKay would have a suggestion or two.

    But whatever. You asked a question, I answered it, you don't like the answer...ok, so? Maybe Blackrock is going to wind up as Lehman brothers and Countrywide Finance did. Maybe they'll make bank and grow even bigger. Time will reveal all. Arguing in a circle won't prove anything.

    What's your explanation for Blackrock's binge of residential RE purchases?

    Replies: @res

  101. anon[645] • Disclaimer says:
    @res
    @anon


    To repeat myself
     
    Understood, but to repeat myself: “who is buying these houses at these valuations?” When I say that I mean who will BlackRock sell to? Remember that these are single family houses. Though one way out (one of Alden's hobby horses) is immigrants living 20 to a house (or even just say 3-4 people each earning a decent wage).

    FWIW, I was having conversations like this about CA real estate circa 2006. And about internet stocks circa 2000. Have you lived through any bear markets following bubbles? The degree of optimistic rationalization to be seen during bubbles is something to behold. I think it is actually one of the best diagnostic indicators.


    As for resale…look at the diagram you posted, examine the far right edge. How long does it take to clear a house title in the current year? IF demand is effectively unconstrained due to endless immigration, what do you expect to continue to see at the right edge next year? That may well be the “new normal”.
     
    Sounds like Irving Fisher with his “Stock prices have reached what looks like a permanently high plateau.”
    https://time.com/3207128/stock-market-high-1929/

    Look, you may be right. BlackRock placing this large a bet makes it likely you will be for a while. But as I said, I don't see the endgame. Try running the numbers for what sort of income is needed to purchase houses at these prices if interest rates go up even a few percent.


    Did you look at the link up thread from 3 years back about Blackrock and Vanguard? It is easy reading and well worth your time.
     
    Thanks. Here it is again to save people searching.
    https://financialpost.com/investing/a-20-trillion-blackrock-vanguard-duopoly-is-investings-future

    Replies: @anon

    Understood, but to repeat myself: “who is buying these houses at these valuations?” When I say that I mean who will BlackRock sell to? Remember that these are single family houses.

    For the third time:

    To repeat myself, they obviously expect continuous demand due to essentially unlimited immigration, and Blackrock is not going into the speculative world of house-flipping like some Vegas bartender in 2006. They expect high demand for years to come.

    Though one way out (one of Alden’s hobby horses) is immigrants living 20 to a house (or even just say 3-4 people each earning a decent wage).

    What is “white flight”? Why would people decide 3 to 5 years from now to sell their current house and move to a newer, nicer one, and be willing to pay Blackrock for it? There’s a ripple effect that can be seen in many cities that could be driven by unlimited immigration. Must I spell it out for you?

    FWIW, I was having conversations like this about CA real estate circa 2006.

    It is very early in this particular housing market.

    And about internet stocks circa 2000. Have you lived through any bear markets following bubbles?

    C’mon, man read between some lines once in while. How do you suppose I know what bartenders and blackjack dealers were doing in Vegas to flip houses in 2006? Or what the house repo world looked like in the Inland Empire by 2007?

    Look, you may be right. BlackRock placing this large a bet makes it likely you will be for a while. But as I said, I don’t see the endgame. Try running the numbers for what sort of income is needed to purchase houses at these prices if interest rates go up even a few percent.

    The fact that you don’t see the endgame does not prove that there isn’t one. OTOH, it is possible Blackrock may “see” something that isn’t really there. Charles MacKay would have a suggestion or two.

    But whatever. You asked a question, I answered it, you don’t like the answer…ok, so? Maybe Blackrock is going to wind up as Lehman brothers and Countrywide Finance did. Maybe they’ll make bank and grow even bigger. Time will reveal all. Arguing in a circle won’t prove anything.

    What’s your explanation for Blackrock’s binge of residential RE purchases?

    • Replies: @res
    @anon


    Must I spell it out for you?
     
    The part that needs spelling out is the point I keep repeating: "who is buying these houses at these valuations?" (again noting, I mean who does BlackRock sell to for a profit later)

    Low wage immigrants are not doing that unless they live many to a house. They do add pressure at the low end which percolates up to more expensive real estate, but at the end of the day you still need people with the assets and/or income to pay those prices. Incomes are not rising that fast, but perhaps financial assets are? Maybe BlackRock's idea is they want to be the first to diversify to profit when everyone else starts running from stocks and bonds? The publicity they get for overpaying (to trigger a further price spike) may be the reason to do it. Especially if you overpay like that rarely but get lots of media mileage out of it. That actually sounds plausible to me. What do you think?

    It is very early in this particular housing market.
     
    I suspect that is an important aspect of our disagreement. From the link I gave above
    https://www.bayareamarketreports.com/trend/3-recessions-2-bubbles-and-a-baby
    see this image and ponder the relative lengths of the bull markets of the past compared to today (and remember we are now in 2021).

    https://paragonpublic.blob.core.windows.net/dash-v2-blog-images/188446/feb-2020_case-shiller_simplified.jpg

    It is always possible for a bubble to go on longer than I expect (in fact, it's typical. I tend to be a year or two early, and occasionally miss completely--like Bitcoin, for the moment anyway).

    But that said, this looks much more like a blow off top to me than an early bull market.

    C’mon, man read between some lines once in while.
     
    Fair enough. But remember that as an anon it is harder to keep track of you as a person and I am also less motivated to do so.

    The fact that you don’t see the endgame does not prove that there isn’t one.
     
    Understood. Which is why I am asking questions.

    OTOH, it is possible Blackrock may “see” something that isn’t really there. Charles MacKay would have a suggestion or two.
     
    It's been a long time since I read MacKay. Can you elaborate? I am looking for what BlackRock is seeing because I just don't find your explanation sufficient to answer my objections.

    You asked a question, I answered it, you don’t like the answer…ok, so?
     
    It's not that I don't "like" the answer, it is that I find it insufficient. And I am trying to get you to elaborate and address my issues.

    What’s your explanation for Blackrock’s binge of residential RE purchases?
     
    In short, I don't know. See my comment 73 above. I think it is some combination of inflation hedge and diversification, but that still does not explain why they are paying 30% over asking rather than 5-10%. Which was my original point. Even if it does not matter in the long run (I believe that is your position), why waste money now? Putting yourself in a 20% hole to start is not the way to invest unless there is a very compelling reason you need to do it that way (which is what leads me to the short squeeze and market corner thoughts, there you temporarily overpay to cash out when things go really crazy).

    Thinking about it more, I like my idea of them trying to trigger a blow off top (which is essentially a version of the short squeeze/market corner original thought). If so, a key piece of information would be how their total inventory of single family houses compares to the current transactions which are getting all the publicity. If the inventory is relatively large using this spike to sell that inventory into the demand seems like a tactic a financial shark might use. And would both generate short term profit and avoid the long term issues discussed above with single family housing as an investment.

    Another speculative reason would be an approach where you buy "all" the houses then raise rents a great deal. (again, a market corner variant)

    Replies: @anon

  102. @dfordoom
    @Twinkie


    Let us have a Franco and be done with it.
     
    The problem with getting a dictator is that it's a crapshoot. You might get lucky and get a sane reasonable dictator, or you might get a butcher or a lunatic.

    And you can't tell until it's too late. Mussolini gave the impression that he was going to be a sane moderate dictator, and mostly that's what he proved to be. The Italians got lucky with their dice roll. But they had no way of knowing they were going to get lucky until they rolled the dice. The Portuguese got reasonably lucky with Salazar.

    The Germans got unlucky.

    And then there's the succession problem. Not a single European dictatorship survived the passing of its original dictator by more than a few years. Except for the Soviet Union, which managed a series of fairly smooth transitions of power. Whether you're pro-Stalin or anti-Stalin he did create a political system that could handle transitions of power. As did Mao and Kim Il-sung. If you want a dictatorship that will survive long-term you need to figure out why communist regimes were much more stable than right-wing dictatorships. Obviously they knew something that right-wing dictatorships didn't know.

    Replies: @SFG, @Rahan, @Bill

    Perhaps they knew that being a US ally is a really bad idea?

    • Replies: @dfordoom
    @Bill


    Perhaps they knew that being a US ally is a really bad idea?
     
    Someone once said that the only thing worse than having America as an enemy was having America as an ally.
  103. @anon
    @Triteleia Laxa

    You don’t think Franco and Mussolini built cults of personality around themselves?

    Not to the extent of Communist regimes such as Stalin, Mao, etc.

    Even though neither regime survived the leader?

    What does that have to do with anything?

    Even though Mussolini is practically the textbook case-study in personality cults?

    Which textbook would that be?

    As recently as the 1970's there were claims from the PRC of some peasant farmer getting better crop yields from those fields where he read aloud nightly from the Little Red Book of Great Helmsman Mao. That kind of magical thinking is an axiomatic example of the cult of personality. It probably made Jim Jones envious.

    It's just a fact that every Communist regime in the 20th century was a cult of personality from the start. Probably the idea of a inerrant regime all but requires an inerrant leader, and thus cult of personality is inevitable. No doubt the idea of every Communist regime as a cult bothers you, as it obviously bothers dfordoom, but the facts don't care about your feelings.

    Franco in Spain and Peron in Argentina arguably had similar grips on their country, yet their regimes did not really survive them, probably because Spaniards and Argentinians could hear radio, read publications and view films from other countries. A Spaniard could ride the train into France and then Italy without much trouble, for example. Comparing the dictator to other countries obviously worked to tarnish the propaganda.

    Compare that with the closed USSR and PRC, where it was a crime to listen to radio from outside the country, where writers were closely watched, typewriters were controlled, etc. Even so it is notable that Nikita Khruschev was never able to attain the wall-to-wall cult status of Staln. The same is true in the PRC, where no one has yet matched Mao in sheer cult status.

    It is obvious that the cult of personality doesn't perform as well when competing information exists. Spain and Argentina were not closed societies, unlike the Warsaw Pact, DPRK, China, etc. Oh and as for Mussolini, there were some events in 1943 that affected his prestige, you may have heard of them?

    All of this is moot, of course. One might as well argue about ancient Crete - the past is past.

    Scrolling back up the thread, I see that this subthread started when dfordoom responded to a childish and foolish statement by Twinkie about "A Franco". This kind of historical ignorance is all too typical in comment boxes across the web, unfortunately.

    Here is a morsel of history...the siege of the Alcazar is a kind of microcosm of the civil war in Spain. This article is well written and accurately references one of the books I have on my shelves, the work by Geoffrey McNeill-Moss.

    https://almostchosenpeople.wordpress.com/2021/05/25/the-siege-of-the-alcazar/

    The Spanish civil war was a huge tragedy. No sane person would wish for such a crisis.

    Replies: @dfordoom

    Scrolling back up the thread, I see that this subthread started when dfordoom responded to a childish and foolish statement by Twinkie about “A Franco”.

    Yes. And I pointed out that wishing for a right-wing dictator was foolish because there is overwhelming historical evidence that right-wing dictatorships always fail because for some reason they are short-lived and do not survive the deaths of the original dictator.

    I also pointed out that for some reason communist dictatorships usually do survive the deaths of the original dictator. Which again is a historical fact.

    The explanation I offered was that communists were clearly better at establishing long-lasting power structures, which I felt suggested that communists must obviously have a more practical approach to the problem of consolidating and maintaining their grip on power.

    Those who have argued against my contentions have done so by simply ignoring the facts of history, because they find historical facts unpleasant.

    The arguments about personality cults are irrelevant because regimes across the entire political spectrum have created personality cults. Obviously the reason that communist dictatorships have been more long-lived than right-wing dictatorships has nothing to do with personality cults.

    • Replies: @anon
    @dfordoom

    Those who have argued against my contentions have done so by simply ignoring the facts of history, because they find historical facts unpleasant.

    lol.

  104. @dfordoom
    @anon


    Scrolling back up the thread, I see that this subthread started when dfordoom responded to a childish and foolish statement by Twinkie about “A Franco”.
     
    Yes. And I pointed out that wishing for a right-wing dictator was foolish because there is overwhelming historical evidence that right-wing dictatorships always fail because for some reason they are short-lived and do not survive the deaths of the original dictator.

    I also pointed out that for some reason communist dictatorships usually do survive the deaths of the original dictator. Which again is a historical fact.

    The explanation I offered was that communists were clearly better at establishing long-lasting power structures, which I felt suggested that communists must obviously have a more practical approach to the problem of consolidating and maintaining their grip on power.

    Those who have argued against my contentions have done so by simply ignoring the facts of history, because they find historical facts unpleasant.

    The arguments about personality cults are irrelevant because regimes across the entire political spectrum have created personality cults. Obviously the reason that communist dictatorships have been more long-lived than right-wing dictatorships has nothing to do with personality cults.

    Replies: @anon

    Those who have argued against my contentions have done so by simply ignoring the facts of history, because they find historical facts unpleasant.

    lol.

  105. @Bill
    @dfordoom

    Perhaps they knew that being a US ally is a really bad idea?

    Replies: @dfordoom

    Perhaps they knew that being a US ally is a really bad idea?

    Someone once said that the only thing worse than having America as an enemy was having America as an ally.

  106. to repeat myself cos it’s important…

    in the post-Trump context given that Blackrock is an off-shoot of the banking mafia, assuming they are operating on economic motives is foolish

    it’s far more likely this is all about destroying the pro-Trump voting bloc by buying up houses in Trump-voting districts and filling them with refugees

    (probably by re-selling the houses to a yet to be announced federal “integration” program at prices above what they paid for them plus c. 10% i.e. ethnic cleansing with a guaranteed profit for the cleansers provided by the taxes of the people being cleansed).

    • Replies: @res
    @notanon

    Thanks. I did not give your earlier comment the attention it deserved. And your re-selling elaboration is definitely food for thought.

    If I had BlackRock scale capital I would at least be thinking about buying up large tracts of blighted areas and reviving them. But that has a great deal of uncertainty. Not least the possibility of triggering a public relations disaster.

    Replies: @Triteleia Laxa

  107. @Triteleia Laxa
    If BlackRock are doing this to make money, they are mistaken. It is a big risk in the short run that interest rates go up and the property market crashes. You argue that, on some level, they know otherwise. I doubt it, even if they are gambling that way, but fine.

    The real problem, though, is that house prices are greatly determined by local supply; and local supply is extremely restricted. The more local voters who are owners, the greater the NIMBY vote.

    If BlackRock buys up entire neighbourhoods, BlackRock still gets zero votes. The renters within those houses get a lot of votes. The political incentives to allow more housebuilding become huge and houses get much cheaper.

    BlackRock just manage too much money and asset prices are stupidly high so they don't know what to do.

    Replies: @anon, @Robert Dolan, @Athletic and Whitesplosive

    The “political incentive” of an electorate strongly in favor of policy x doesn’t matter at this level of business entrenchment in politics/media, hence why America is the way it is. I mean it’s debatable if there’s any “democratic” arrangement where public opinion really matters and has a big impact on policy, it’s more that the preferred policy of the elite is pushed strongly on the public and inevitably makes progress.

    In municipal politics it’s mildly more “impactful” maybe, but not really that relevant. Even if zoning is relaxed and more houses allowed to be built there’s a million ways an extremely wealthy encumbent could either torpedo it in the end or leverage it to their ultimate advantage.

    • Replies: @Triteleia Laxa
    @Athletic and Whitesplosive

    The closer the number of owner-occupiers gets to zero, along with the higher the social competency of the tenants, the more pressure there will be for new construction. I don't care how devious the company, they will never be able to stop that if such approaches 20% or lower, and they are middle class peoples. They would be working against a huge pile of motivated and competent free labour. There's just no chance.

  108. @Athletic and Whitesplosive
    @Triteleia Laxa

    The "political incentive" of an electorate strongly in favor of policy x doesn't matter at this level of business entrenchment in politics/media, hence why America is the way it is. I mean it's debatable if there's any "democratic" arrangement where public opinion really matters and has a big impact on policy, it's more that the preferred policy of the elite is pushed strongly on the public and inevitably makes progress.

    In municipal politics it's mildly more "impactful" maybe, but not really that relevant. Even if zoning is relaxed and more houses allowed to be built there's a million ways an extremely wealthy encumbent could either torpedo it in the end or leverage it to their ultimate advantage.

    Replies: @Triteleia Laxa

    The closer the number of owner-occupiers gets to zero, along with the higher the social competency of the tenants, the more pressure there will be for new construction. I don’t care how devious the company, they will never be able to stop that if such approaches 20% or lower, and they are middle class peoples. They would be working against a huge pile of motivated and competent free labour. There’s just no chance.

  109. res says:
    @anon
    @res

    Understood, but to repeat myself: “who is buying these houses at these valuations?” When I say that I mean who will BlackRock sell to? Remember that these are single family houses.

    For the third time:


    To repeat myself, they obviously expect continuous demand due to essentially unlimited immigration, and Blackrock is not going into the speculative world of house-flipping like some Vegas bartender in 2006. They expect high demand for years to come.
     
    Though one way out (one of Alden’s hobby horses) is immigrants living 20 to a house (or even just say 3-4 people each earning a decent wage).

    What is "white flight"? Why would people decide 3 to 5 years from now to sell their current house and move to a newer, nicer one, and be willing to pay Blackrock for it? There's a ripple effect that can be seen in many cities that could be driven by unlimited immigration. Must I spell it out for you?

    FWIW, I was having conversations like this about CA real estate circa 2006.

    It is very early in this particular housing market.

    And about internet stocks circa 2000. Have you lived through any bear markets following bubbles?

    C'mon, man read between some lines once in while. How do you suppose I know what bartenders and blackjack dealers were doing in Vegas to flip houses in 2006? Or what the house repo world looked like in the Inland Empire by 2007?

    Look, you may be right. BlackRock placing this large a bet makes it likely you will be for a while. But as I said, I don’t see the endgame. Try running the numbers for what sort of income is needed to purchase houses at these prices if interest rates go up even a few percent.

    The fact that you don't see the endgame does not prove that there isn't one. OTOH, it is possible Blackrock may "see" something that isn't really there. Charles MacKay would have a suggestion or two.

    But whatever. You asked a question, I answered it, you don't like the answer...ok, so? Maybe Blackrock is going to wind up as Lehman brothers and Countrywide Finance did. Maybe they'll make bank and grow even bigger. Time will reveal all. Arguing in a circle won't prove anything.

    What's your explanation for Blackrock's binge of residential RE purchases?

    Replies: @res

    Must I spell it out for you?

    The part that needs spelling out is the point I keep repeating: “who is buying these houses at these valuations?” (again noting, I mean who does BlackRock sell to for a profit later)

    Low wage immigrants are not doing that unless they live many to a house. They do add pressure at the low end which percolates up to more expensive real estate, but at the end of the day you still need people with the assets and/or income to pay those prices. Incomes are not rising that fast, but perhaps financial assets are? Maybe BlackRock’s idea is they want to be the first to diversify to profit when everyone else starts running from stocks and bonds? The publicity they get for overpaying (to trigger a further price spike) may be the reason to do it. Especially if you overpay like that rarely but get lots of media mileage out of it. That actually sounds plausible to me. What do you think?

    It is very early in this particular housing market.

    I suspect that is an important aspect of our disagreement. From the link I gave above
    https://www.bayareamarketreports.com/trend/3-recessions-2-bubbles-and-a-baby
    see this image and ponder the relative lengths of the bull markets of the past compared to today (and remember we are now in 2021).

    It is always possible for a bubble to go on longer than I expect (in fact, it’s typical. I tend to be a year or two early, and occasionally miss completely–like Bitcoin, for the moment anyway).

    But that said, this looks much more like a blow off top to me than an early bull market.

    C’mon, man read between some lines once in while.

    Fair enough. But remember that as an anon it is harder to keep track of you as a person and I am also less motivated to do so.

    The fact that you don’t see the endgame does not prove that there isn’t one.

    Understood. Which is why I am asking questions.

    OTOH, it is possible Blackrock may “see” something that isn’t really there. Charles MacKay would have a suggestion or two.

    It’s been a long time since I read MacKay. Can you elaborate? I am looking for what BlackRock is seeing because I just don’t find your explanation sufficient to answer my objections.

    You asked a question, I answered it, you don’t like the answer…ok, so?

    It’s not that I don’t “like” the answer, it is that I find it insufficient. And I am trying to get you to elaborate and address my issues.

    What’s your explanation for Blackrock’s binge of residential RE purchases?

    In short, I don’t know. See my comment 73 above. I think it is some combination of inflation hedge and diversification, but that still does not explain why they are paying 30% over asking rather than 5-10%. Which was my original point. Even if it does not matter in the long run (I believe that is your position), why waste money now? Putting yourself in a 20% hole to start is not the way to invest unless there is a very compelling reason you need to do it that way (which is what leads me to the short squeeze and market corner thoughts, there you temporarily overpay to cash out when things go really crazy).

    Thinking about it more, I like my idea of them trying to trigger a blow off top (which is essentially a version of the short squeeze/market corner original thought). If so, a key piece of information would be how their total inventory of single family houses compares to the current transactions which are getting all the publicity. If the inventory is relatively large using this spike to sell that inventory into the demand seems like a tactic a financial shark might use. And would both generate short term profit and avoid the long term issues discussed above with single family housing as an investment.

    Another speculative reason would be an approach where you buy “all” the houses then raise rents a great deal. (again, a market corner variant)

    • Replies: @anon
    @res

    The part that needs spelling out is the point I keep repeating: “who is buying these houses at these valuations?” (again noting, I mean who does BlackRock sell to for a profit later)

    Ok, let's go way back to basics. Please read the following article.

    https://infogalactic.com/info/Supply_and_demand

    After reading that article, try this quiz:

    Q: If the population of the US continues to increase year over year for at least the next four years, which of the following is most likely?

    A: Demand for housing will decrease.
    B: Demand for housing will remain flat.
    C: Demand for housing will increase.
    D: Don't know.

    Replies: @Triteleia Laxa, @res

  110. res says:
    @notanon
    to repeat myself cos it's important...

    in the post-Trump context given that Blackrock is an off-shoot of the banking mafia, assuming they are operating on economic motives is foolish

    it's far more likely this is all about destroying the pro-Trump voting bloc by buying up houses in Trump-voting districts and filling them with refugees

    (probably by re-selling the houses to a yet to be announced federal "integration" program at prices above what they paid for them plus c. 10% i.e. ethnic cleansing with a guaranteed profit for the cleansers provided by the taxes of the people being cleansed).

    Replies: @res

    Thanks. I did not give your earlier comment the attention it deserved. And your re-selling elaboration is definitely food for thought.

    If I had BlackRock scale capital I would at least be thinking about buying up large tracts of blighted areas and reviving them. But that has a great deal of uncertainty. Not least the possibility of triggering a public relations disaster.

    • Replies: @Triteleia Laxa
    @res

    Huge developers do this, but only in partnership/constant consultation with government, for the reasons you identify.

    Replies: @res

  111. anon[166] • Disclaimer says:
    @res
    @anon


    Must I spell it out for you?
     
    The part that needs spelling out is the point I keep repeating: "who is buying these houses at these valuations?" (again noting, I mean who does BlackRock sell to for a profit later)

    Low wage immigrants are not doing that unless they live many to a house. They do add pressure at the low end which percolates up to more expensive real estate, but at the end of the day you still need people with the assets and/or income to pay those prices. Incomes are not rising that fast, but perhaps financial assets are? Maybe BlackRock's idea is they want to be the first to diversify to profit when everyone else starts running from stocks and bonds? The publicity they get for overpaying (to trigger a further price spike) may be the reason to do it. Especially if you overpay like that rarely but get lots of media mileage out of it. That actually sounds plausible to me. What do you think?

    It is very early in this particular housing market.
     
    I suspect that is an important aspect of our disagreement. From the link I gave above
    https://www.bayareamarketreports.com/trend/3-recessions-2-bubbles-and-a-baby
    see this image and ponder the relative lengths of the bull markets of the past compared to today (and remember we are now in 2021).

    https://paragonpublic.blob.core.windows.net/dash-v2-blog-images/188446/feb-2020_case-shiller_simplified.jpg

    It is always possible for a bubble to go on longer than I expect (in fact, it's typical. I tend to be a year or two early, and occasionally miss completely--like Bitcoin, for the moment anyway).

    But that said, this looks much more like a blow off top to me than an early bull market.

    C’mon, man read between some lines once in while.
     
    Fair enough. But remember that as an anon it is harder to keep track of you as a person and I am also less motivated to do so.

    The fact that you don’t see the endgame does not prove that there isn’t one.
     
    Understood. Which is why I am asking questions.

    OTOH, it is possible Blackrock may “see” something that isn’t really there. Charles MacKay would have a suggestion or two.
     
    It's been a long time since I read MacKay. Can you elaborate? I am looking for what BlackRock is seeing because I just don't find your explanation sufficient to answer my objections.

    You asked a question, I answered it, you don’t like the answer…ok, so?
     
    It's not that I don't "like" the answer, it is that I find it insufficient. And I am trying to get you to elaborate and address my issues.

    What’s your explanation for Blackrock’s binge of residential RE purchases?
     
    In short, I don't know. See my comment 73 above. I think it is some combination of inflation hedge and diversification, but that still does not explain why they are paying 30% over asking rather than 5-10%. Which was my original point. Even if it does not matter in the long run (I believe that is your position), why waste money now? Putting yourself in a 20% hole to start is not the way to invest unless there is a very compelling reason you need to do it that way (which is what leads me to the short squeeze and market corner thoughts, there you temporarily overpay to cash out when things go really crazy).

    Thinking about it more, I like my idea of them trying to trigger a blow off top (which is essentially a version of the short squeeze/market corner original thought). If so, a key piece of information would be how their total inventory of single family houses compares to the current transactions which are getting all the publicity. If the inventory is relatively large using this spike to sell that inventory into the demand seems like a tactic a financial shark might use. And would both generate short term profit and avoid the long term issues discussed above with single family housing as an investment.

    Another speculative reason would be an approach where you buy "all" the houses then raise rents a great deal. (again, a market corner variant)

    Replies: @anon

    The part that needs spelling out is the point I keep repeating: “who is buying these houses at these valuations?” (again noting, I mean who does BlackRock sell to for a profit later)

    Ok, let’s go way back to basics. Please read the following article.

    https://infogalactic.com/info/Supply_and_demand

    After reading that article, try this quiz:

    Q: If the population of the US continues to increase year over year for at least the next four years, which of the following is most likely?

    A: Demand for housing will decrease.
    B: Demand for housing will remain flat.
    C: Demand for housing will increase.
    D: Don’t know.

    • Replies: @Triteleia Laxa
    @anon

    Houses get built. House prices are also vastly inflated by low interest rates. Most people buy with mortgages, so it isn't the actual price of the house upon which demand and supply rests, but the probable monthly interest payment.

    My comment is a simplification, but your comment is a lot more simple still.

    , @res
    @anon

    Do you really think I am unfamiliar with Micro 101?

    In the caption of the graphic at your link here is what they say. Emphasis mine.


    The price P of a product is determined by a balance between production at each price (supply S) and the desires of those with purchasing power at each price (demand D).
     
    The number of people matters, but what matters much more is the number of people able to pay the prices being asked (do you notice a theme here?). As the prices increase that number falls (that's the demand curve). Whether a given level of immigration is sufficient to overcome that effect is a non-trivial question IMHO. This also raises the question of what happens if the music (immigration) stops or slows down (as you observe, unlikely with Biden as president, but that's why I talk about end games).

    If you really want to make a supply demand argument maybe try doing it with stabs at what the supply and demand curves look like and how the price history plays in. Sample questions: how much does demand have to increase to justify a 30% YOY price increase? What rate of immigration would that imply?

    Another key thing your simplistic comment omits is how elastic the supply is. One thing which contributes to the boom/bust aspect of real estate is the lag time involved in getting new housing approved and then building it. Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    Then there is the question of how overall economic health affects the demand curve. The last year plus has been neither typical nor sustainable.

    I think it is worth considering in general how well the real estate market does or does not match the assumptions of Micro 101. One example being how sticky owner occupied single family homes can be.

    P.S. Triteleia Laxa's comment about mortgages is relevant. I have been eliding that point as well (except for my comment about what happens if interest rates increase). Worth mentioning that both interest rates and underwriting standards are relevant. Variation in both of those also contributes to the boom/bust tendency. Also TL's comment about "houses get built" which is my "how elastic the supply is." (I thought you might appreciate the economics terminology)

    Replies: @anon, @V. K. Ovelund

  112. @anon
    @res

    The part that needs spelling out is the point I keep repeating: “who is buying these houses at these valuations?” (again noting, I mean who does BlackRock sell to for a profit later)

    Ok, let's go way back to basics. Please read the following article.

    https://infogalactic.com/info/Supply_and_demand

    After reading that article, try this quiz:

    Q: If the population of the US continues to increase year over year for at least the next four years, which of the following is most likely?

    A: Demand for housing will decrease.
    B: Demand for housing will remain flat.
    C: Demand for housing will increase.
    D: Don't know.

    Replies: @Triteleia Laxa, @res

    Houses get built. House prices are also vastly inflated by low interest rates. Most people buy with mortgages, so it isn’t the actual price of the house upon which demand and supply rests, but the probable monthly interest payment.

    My comment is a simplification, but your comment is a lot more simple still.

  113. @res
    @notanon

    Thanks. I did not give your earlier comment the attention it deserved. And your re-selling elaboration is definitely food for thought.

    If I had BlackRock scale capital I would at least be thinking about buying up large tracts of blighted areas and reviving them. But that has a great deal of uncertainty. Not least the possibility of triggering a public relations disaster.

    Replies: @Triteleia Laxa

    Huge developers do this, but only in partnership/constant consultation with government, for the reasons you identify.

    • Replies: @res
    @Triteleia Laxa

    Thanks. Do you know of any good case studies?

    Replies: @Triteleia Laxa

  114. res says:
    @anon
    @res

    The part that needs spelling out is the point I keep repeating: “who is buying these houses at these valuations?” (again noting, I mean who does BlackRock sell to for a profit later)

    Ok, let's go way back to basics. Please read the following article.

    https://infogalactic.com/info/Supply_and_demand

    After reading that article, try this quiz:

    Q: If the population of the US continues to increase year over year for at least the next four years, which of the following is most likely?

    A: Demand for housing will decrease.
    B: Demand for housing will remain flat.
    C: Demand for housing will increase.
    D: Don't know.

    Replies: @Triteleia Laxa, @res

    Do you really think I am unfamiliar with Micro 101?

    In the caption of the graphic at your link here is what they say. Emphasis mine.

    The price P of a product is determined by a balance between production at each price (supply S) and the desires of those with purchasing power at each price (demand D).

    The number of people matters, but what matters much more is the number of people able to pay the prices being asked (do you notice a theme here?). As the prices increase that number falls (that’s the demand curve). Whether a given level of immigration is sufficient to overcome that effect is a non-trivial question IMHO. This also raises the question of what happens if the music (immigration) stops or slows down (as you observe, unlikely with Biden as president, but that’s why I talk about end games).

    If you really want to make a supply demand argument maybe try doing it with stabs at what the supply and demand curves look like and how the price history plays in. Sample questions: how much does demand have to increase to justify a 30% YOY price increase? What rate of immigration would that imply?

    Another key thing your simplistic comment omits is how elastic the supply is. One thing which contributes to the boom/bust aspect of real estate is the lag time involved in getting new housing approved and then building it. Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    Then there is the question of how overall economic health affects the demand curve. The last year plus has been neither typical nor sustainable.

    I think it is worth considering in general how well the real estate market does or does not match the assumptions of Micro 101. One example being how sticky owner occupied single family homes can be.

    P.S. Triteleia Laxa’s comment about mortgages is relevant. I have been eliding that point as well (except for my comment about what happens if interest rates increase). Worth mentioning that both interest rates and underwriting standards are relevant. Variation in both of those also contributes to the boom/bust tendency. Also TL’s comment about “houses get built” which is my “how elastic the supply is.” (I thought you might appreciate the economics terminology)

    • Replies: @anon
    @res

    Do you really think I am unfamiliar with Micro 101?

    All I know is what you choose to show me. So far, I have seen zero evidence that you even understand supply / demand or "buy low, sell high", let alone more complex notions such as "buy high, sell higher". So, yeah, I do think you have minimal to no familiarity with microeconomics based on your own words.

    The number of people matters, but what matters much more is the number of people able to pay the prices being asked (do you notice a theme here?).

    Yes, it is another example of your unfamiliarity with basic economics. Not all houses have the same price, even within a distance of 100 meters there can be notable price differences. There is a range from "low cost starter house" to "McMansion". People often move for non-economic reasons, such as "the third child" or " the mother in law moves in", as well as "the good school". Mass immigration can change a perception of "the good school". You should already know this.

    Whether a given level of immigration is sufficient to overcome that effect is a non-trivial question IMHO.

    Again you display a lack of knowledge. Perhaps you should spend some time with someone who sells residential RE and learn? What is a "starter home"? Do parental expectations for a "good school" ever change? How about expectations of "safe neighborhood", is there any exogenous force than can change the perception from "safe place to live" to "not what is used to be"?

    This also raises the question of what happens if the music (immigration) stops or slows down (as you observe, unlikely with Biden as president, but that’s why I talk about end games).

    Oh, come on.

    Look, if you knew that the price of copper was going to monotonically increase for the next 4 years, would you buy shares in Freeport (FCX) and start using the dividends to buy more shares, or would you dither over the "end game"? If you knew the population of the US would continue to increase for the forseeable future, while the supply of land would remain fixed, what would that say about the price of residential RE?

    Another key thing your simplistic comment omits is how elastic the supply is.

    I am truly sorry that a short, off the cuff, observation in a combox was not accompanied by a detailed analysis of the total US housing supply on a county-by-county basis, however you are not paying me for that work. There are limits to what I am willing to do for free.

    One thing which contributes to the boom/bust aspect of real estate is the lag time involved in getting new housing approved and then building it.

    I already pointed out to you the current push to rewrite local zoning laws; specifically single-family-residence zoning has been declared to be borderline racist. If I can tear down a couple of older houses in my neighborhood and replace them with duplexes, triplexes or quadplexes then the total residential RE in my neighborhood will increase. Rentals tend to have less stable inhabitants, especially Section 8 cases. Thus shifting my area from all single family RE to mixed with multi-family RE will also tend make the remaining single family RE less desirable to many people, and would likely induce a few families to move to the new development of single family RE that's about 1 mile away. The builder of that development would make a profit selling single family RE. If someone had bought all the houses while they were under construction, that someone could sell for a profit also.

    Do you see, yet, how BlackRock can make money buying now, collecting rent/lease money, then selling in some number of years? Note that this comment does not include tax issues, depreciation, maintenance contracts, landscaping contracts, or other details. Therefore you are free to scoff once again, if that's what makes you happy.

    Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    This is an intelligent statement. Knowing the zip codes BlackRock is buying into would be interesting and actionable.

    P.S. Triteleia Laxa’s comment about mortgages is relevant.

    Comments from obvious trolls are generally not relevant to even a slightly serious discussion.

    Replies: @res

    , @V. K. Ovelund
    @res

    I cannot speak for anyone else but I stopped reading @anon's sophomoric walls of text early in the thread. He is obviously uninterested in having a reasonable conversation. Lacking wit, his insults do not sting.

    I just hope that Dunbar's number never overtakes this blog. AE has got such a fine crew of commenters here, it'd be a shame to see it drowned in anons.

    Replies: @res

  115. @Triteleia Laxa
    @res

    Huge developers do this, but only in partnership/constant consultation with government, for the reasons you identify.

    Replies: @res

    Thanks. Do you know of any good case studies?

    • Replies: @Triteleia Laxa
    @res

    From dodgy crime-ridden train station, to luxury flats, organic food markets and Google headquarters.

    https://www.kingscross.co.uk/about-the-development

    Replies: @res

  116. @res
    @Triteleia Laxa

    Thanks. Do you know of any good case studies?

    Replies: @Triteleia Laxa

    From dodgy crime-ridden train station, to luxury flats, organic food markets and Google headquarters.

    https://www.kingscross.co.uk/about-the-development

    • Replies: @res
    @Triteleia Laxa

    Thanks. Do you know anything about the process they followed and how investors like BlackRock were involved?

    The Portland, Oregon Northwest District Plan is probably a decent example as well
    https://scholarsbank.uoregon.edu/xmlui/handle/1794/6228
    but I don't know enough about it to map to our discussion here.

    Replies: @Triteleia Laxa

  117. @Triteleia Laxa
    @res

    From dodgy crime-ridden train station, to luxury flats, organic food markets and Google headquarters.

    https://www.kingscross.co.uk/about-the-development

    Replies: @res

    Thanks. Do you know anything about the process they followed and how investors like BlackRock were involved?

    The Portland, Oregon Northwest District Plan is probably a decent example as well
    https://scholarsbank.uoregon.edu/xmlui/handle/1794/6228
    but I don’t know enough about it to map to our discussion here.

    • Replies: @Triteleia Laxa
    @res

    These are all of the organisations involved:

    https://www.kingscross.co.uk/whos-developing-kings-cross?amp

    Primarily, it was a major property developer, backed by a politically connected pension fund, among others.

    It helped that there was one landowner, though securing the land rights, on condition of planning permission being granted, from lots of landowners, at a pre-agreed set of prices, is normal.

    The whole thing took about 20 years until every part of the development was opened up. Higher fashion shops came last.

    It will also be a few years more, partly because of Covid, before Londoners' habits, and office rentals, adjust, so that it is as bustling as it may one day be. It is its own little town, with destination shops that many don't know about yet, off in a place where people aren't used to going. That's why it may be very profitable, but also why it may take a long time to realise.

    The development is very well executed. The creation of new public spaces is welcomed by all except the ideologues, who don't like the fact that it is privately run. The aesthetic fits with the area and has an archeo-futuristic feel. It makes an excellent model in these respects.

    As an aside, I'm skeptical that BlackRock are doing anything more than making a few ancillary bets, with the ridiculous amount of money they have under management. I can't know, but a lot of the breathless reporting strikes me as coming from a place of ignorance. Not that I am better informed!

  118. @res
    @Triteleia Laxa

    Thanks. Do you know anything about the process they followed and how investors like BlackRock were involved?

    The Portland, Oregon Northwest District Plan is probably a decent example as well
    https://scholarsbank.uoregon.edu/xmlui/handle/1794/6228
    but I don't know enough about it to map to our discussion here.

    Replies: @Triteleia Laxa

    These are all of the organisations involved:

    https://www.kingscross.co.uk/whos-developing-kings-cross?amp

    Primarily, it was a major property developer, backed by a politically connected pension fund, among others.

    It helped that there was one landowner, though securing the land rights, on condition of planning permission being granted, from lots of landowners, at a pre-agreed set of prices, is normal.

    The whole thing took about 20 years until every part of the development was opened up. Higher fashion shops came last.

    It will also be a few years more, partly because of Covid, before Londoners’ habits, and office rentals, adjust, so that it is as bustling as it may one day be. It is its own little town, with destination shops that many don’t know about yet, off in a place where people aren’t used to going. That’s why it may be very profitable, but also why it may take a long time to realise.

    The development is very well executed. The creation of new public spaces is welcomed by all except the ideologues, who don’t like the fact that it is privately run. The aesthetic fits with the area and has an archeo-futuristic feel. It makes an excellent model in these respects.

    As an aside, I’m skeptical that BlackRock are doing anything more than making a few ancillary bets, with the ridiculous amount of money they have under management. I can’t know, but a lot of the breathless reporting strikes me as coming from a place of ignorance. Not that I am better informed!

    • Thanks: res
  119. anon[188] • Disclaimer says:
    @res
    @anon

    Do you really think I am unfamiliar with Micro 101?

    In the caption of the graphic at your link here is what they say. Emphasis mine.


    The price P of a product is determined by a balance between production at each price (supply S) and the desires of those with purchasing power at each price (demand D).
     
    The number of people matters, but what matters much more is the number of people able to pay the prices being asked (do you notice a theme here?). As the prices increase that number falls (that's the demand curve). Whether a given level of immigration is sufficient to overcome that effect is a non-trivial question IMHO. This also raises the question of what happens if the music (immigration) stops or slows down (as you observe, unlikely with Biden as president, but that's why I talk about end games).

    If you really want to make a supply demand argument maybe try doing it with stabs at what the supply and demand curves look like and how the price history plays in. Sample questions: how much does demand have to increase to justify a 30% YOY price increase? What rate of immigration would that imply?

    Another key thing your simplistic comment omits is how elastic the supply is. One thing which contributes to the boom/bust aspect of real estate is the lag time involved in getting new housing approved and then building it. Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    Then there is the question of how overall economic health affects the demand curve. The last year plus has been neither typical nor sustainable.

    I think it is worth considering in general how well the real estate market does or does not match the assumptions of Micro 101. One example being how sticky owner occupied single family homes can be.

    P.S. Triteleia Laxa's comment about mortgages is relevant. I have been eliding that point as well (except for my comment about what happens if interest rates increase). Worth mentioning that both interest rates and underwriting standards are relevant. Variation in both of those also contributes to the boom/bust tendency. Also TL's comment about "houses get built" which is my "how elastic the supply is." (I thought you might appreciate the economics terminology)

    Replies: @anon, @V. K. Ovelund

    Do you really think I am unfamiliar with Micro 101?

    All I know is what you choose to show me. So far, I have seen zero evidence that you even understand supply / demand or “buy low, sell high”, let alone more complex notions such as “buy high, sell higher“. So, yeah, I do think you have minimal to no familiarity with microeconomics based on your own words.

    The number of people matters, but what matters much more is the number of people able to pay the prices being asked (do you notice a theme here?).

    Yes, it is another example of your unfamiliarity with basic economics. Not all houses have the same price, even within a distance of 100 meters there can be notable price differences. There is a range from “low cost starter house” to “McMansion”. People often move for non-economic reasons, such as “the third child” or ” the mother in law moves in”, as well as “the good school”. Mass immigration can change a perception of “the good school”. You should already know this.

    Whether a given level of immigration is sufficient to overcome that effect is a non-trivial question IMHO.

    Again you display a lack of knowledge. Perhaps you should spend some time with someone who sells residential RE and learn? What is a “starter home”? Do parental expectations for a “good school” ever change? How about expectations of “safe neighborhood”, is there any exogenous force than can change the perception from “safe place to live” to “not what is used to be”?

    This also raises the question of what happens if the music (immigration) stops or slows down (as you observe, unlikely with Biden as president, but that’s why I talk about end games).

    Oh, come on.

    Look, if you knew that the price of copper was going to monotonically increase for the next 4 years, would you buy shares in Freeport (FCX) and start using the dividends to buy more shares, or would you dither over the “end game”? If you knew the population of the US would continue to increase for the forseeable future, while the supply of land would remain fixed, what would that say about the price of residential RE?

    Another key thing your simplistic comment omits is how elastic the supply is.

    I am truly sorry that a short, off the cuff, observation in a combox was not accompanied by a detailed analysis of the total US housing supply on a county-by-county basis, however you are not paying me for that work. There are limits to what I am willing to do for free.

    One thing which contributes to the boom/bust aspect of real estate is the lag time involved in getting new housing approved and then building it.

    I already pointed out to you the current push to rewrite local zoning laws; specifically single-family-residence zoning has been declared to be borderline racist. If I can tear down a couple of older houses in my neighborhood and replace them with duplexes, triplexes or quadplexes then the total residential RE in my neighborhood will increase. Rentals tend to have less stable inhabitants, especially Section 8 cases. Thus shifting my area from all single family RE to mixed with multi-family RE will also tend make the remaining single family RE less desirable to many people, and would likely induce a few families to move to the new development of single family RE that’s about 1 mile away. The builder of that development would make a profit selling single family RE. If someone had bought all the houses while they were under construction, that someone could sell for a profit also.

    Do you see, yet, how BlackRock can make money buying now, collecting rent/lease money, then selling in some number of years? Note that this comment does not include tax issues, depreciation, maintenance contracts, landscaping contracts, or other details. Therefore you are free to scoff once again, if that’s what makes you happy.

    Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    This is an intelligent statement. Knowing the zip codes BlackRock is buying into would be interesting and actionable.

    P.S. Triteleia Laxa’s comment about mortgages is relevant.

    Comments from obvious trolls are generally not relevant to even a slightly serious discussion.

    • Replies: @res
    @anon


    (lots of non-constructive wrangling about who understands Micro 101 and who does not)
     
    The demand curve I mentioned encapsulates most of what you said there (and you were the one who introduced the oversimplification of a single price with your Micro 101 link). That you think the supply curve is not important enough to discuss in a conversation of the length we are having says a lot about you, none good. As does your ridiculous hyperbole: "detailed analysis of the total US housing supply on a county-by-county basis."

    I already pointed out to you the current push to rewrite local zoning laws; specifically single-family-residence zoning has been declared to be borderline racist. If I can tear down a couple of older houses in my neighborhood and replace them with duplexes, triplexes or quadplexes then the total residential RE in my neighborhood will increase. Rentals tend to have less stable inhabitants, especially Section 8 cases. Thus shifting my area from all single family RE to mixed with multi-family RE will also tend make the remaining single family RE less desirable to many people, and would likely induce a few families to move to the new development of single family RE that’s about 1 mile away. The builder of that development would make a profit selling single family RE. If someone had bought all the houses while they were under construction, that someone could sell for a profit also.
     
    I did not give those points enough attention (IIRC correctly you were less explicit then). Not sure if they are sufficient, but they definitely add to the argument. Thanks. BTW, that is the kind of thing I mean by "end game." In this case the next step after buying and renting out (as opposed to simply selling at some point).

    I found this link from another comment thread useful:
    http://dissident-mag.com/2021/06/14/blackrock-is-waging-war-on-american-home-buyers/

    You have discussed the renting out aspect before, but the willingness to raise rents (which takes advantage of the stickiness of housing, people don't want to move) combined with the implications of your above point make the overall argument more compelling.

    At this point, I find the following analysis sufficient explanation for BlackRock's actions here. Thanks for helping me get to this point. Anything you would add or remove? Anyone else have any thoughts?

    1. Primary purpose is buying the houses to rent with the expectation of increasing rent significantly going forward. It depends greatly on locality, but I think the assets/income hurdle issue I have is less important for renting than reselling.

    2. Converting some fraction of the single family houses to higher uses (multifamily housing or commercial). This would not only increase the value of those properties, it would also decrease the supply of competing single family homes.

    RoatanBill's comment 42 about rent control is also worth considering in this context. Whether BlackRock really has the political power to do as he describes is an important element of this conversation. In line with that I would add 3.

    3. An important point is that BlackRock may be better able to accomplish both the raising rents part of 1. and all of 2. because of their control of greater proportions of the supply (here is my market corner idea in attenuated form) and their greater political power compared to other landlords.

    If they really can get a competitive advantage over other landlords through their scale this makes a great deal more sense IMHO.

    Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    This is an intelligent statement. Knowing the zip codes BlackRock is buying into would be interesting and actionable.
     
    Thanks. Being able to notice and acknowledge that helps indicate you are not a troll and have useful powers of discrimination.

    P.S. Triteleia Laxa’s comment about mortgages is relevant.

    Comments from obvious trolls are generally not relevant to even a slightly serious discussion.
     
    Generally, but not always. Being able to tell the difference is a useful skill. And a useful way to judge the skill of others. I contend that comment was relevant.

    P.S. I still don't think we have a reasonable answer to: why overpay 30% rather than 5-10%? Do you think my "to use the publicity to push the market higher" idea has any merit? Or perhaps there is something really special about those properties (say in terms of redevelopment potential, or filling in a hole in an attempt to buy a contiguous block)?

    Replies: @anon

  120. @res
    @anon

    Do you really think I am unfamiliar with Micro 101?

    In the caption of the graphic at your link here is what they say. Emphasis mine.


    The price P of a product is determined by a balance between production at each price (supply S) and the desires of those with purchasing power at each price (demand D).
     
    The number of people matters, but what matters much more is the number of people able to pay the prices being asked (do you notice a theme here?). As the prices increase that number falls (that's the demand curve). Whether a given level of immigration is sufficient to overcome that effect is a non-trivial question IMHO. This also raises the question of what happens if the music (immigration) stops or slows down (as you observe, unlikely with Biden as president, but that's why I talk about end games).

    If you really want to make a supply demand argument maybe try doing it with stabs at what the supply and demand curves look like and how the price history plays in. Sample questions: how much does demand have to increase to justify a 30% YOY price increase? What rate of immigration would that imply?

    Another key thing your simplistic comment omits is how elastic the supply is. One thing which contributes to the boom/bust aspect of real estate is the lag time involved in getting new housing approved and then building it. Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    Then there is the question of how overall economic health affects the demand curve. The last year plus has been neither typical nor sustainable.

    I think it is worth considering in general how well the real estate market does or does not match the assumptions of Micro 101. One example being how sticky owner occupied single family homes can be.

    P.S. Triteleia Laxa's comment about mortgages is relevant. I have been eliding that point as well (except for my comment about what happens if interest rates increase). Worth mentioning that both interest rates and underwriting standards are relevant. Variation in both of those also contributes to the boom/bust tendency. Also TL's comment about "houses get built" which is my "how elastic the supply is." (I thought you might appreciate the economics terminology)

    Replies: @anon, @V. K. Ovelund

    I cannot speak for anyone else but I stopped reading ’s sophomoric walls of text early in the thread. He is obviously uninterested in having a reasonable conversation. Lacking wit, his insults do not sting.

    I just hope that Dunbar’s number never overtakes this blog. AE has got such a fine crew of commenters here, it’d be a shame to see it drowned in anons.

    • Replies: @res
    @V. K. Ovelund


    I stopped reading @anon’s sophomoric walls of text early in the thread. He is obviously uninterested in having a reasonable conversation.
     
    I tend to be all about Signal to Noise Ratio (SNR). I am willing to put up with a good deal of noise if I get a meaningful signal in return. In this case I think I did. Sometimes I waste a lot of time with no return and a bunch of annoyance. YMMV.

    I just hope that Dunbar’s number never overtakes this blog. AE has got such a fine crew of commenters here, it’d be a shame to see it drowned in anons.
     
    Agreed, though I am more concerned with disingenuous trolls (anon or not) than anons. The disingenuous trolls do terrible things to conversation dynamics and the cost/benefit tradeoff of reading the comments.

    Regarding Dunbar's number, does it depend on what cues you have for remembering people (compare real life to video, to phone, to name, to individual email, to meaningful pseudonym, to short pseudonym, to numerical anon, any more?) as well as the depth/intensity of the interactions?

    Replies: @V. K. Ovelund

  121. res says:
    @anon
    @res

    Do you really think I am unfamiliar with Micro 101?

    All I know is what you choose to show me. So far, I have seen zero evidence that you even understand supply / demand or "buy low, sell high", let alone more complex notions such as "buy high, sell higher". So, yeah, I do think you have minimal to no familiarity with microeconomics based on your own words.

    The number of people matters, but what matters much more is the number of people able to pay the prices being asked (do you notice a theme here?).

    Yes, it is another example of your unfamiliarity with basic economics. Not all houses have the same price, even within a distance of 100 meters there can be notable price differences. There is a range from "low cost starter house" to "McMansion". People often move for non-economic reasons, such as "the third child" or " the mother in law moves in", as well as "the good school". Mass immigration can change a perception of "the good school". You should already know this.

    Whether a given level of immigration is sufficient to overcome that effect is a non-trivial question IMHO.

    Again you display a lack of knowledge. Perhaps you should spend some time with someone who sells residential RE and learn? What is a "starter home"? Do parental expectations for a "good school" ever change? How about expectations of "safe neighborhood", is there any exogenous force than can change the perception from "safe place to live" to "not what is used to be"?

    This also raises the question of what happens if the music (immigration) stops or slows down (as you observe, unlikely with Biden as president, but that’s why I talk about end games).

    Oh, come on.

    Look, if you knew that the price of copper was going to monotonically increase for the next 4 years, would you buy shares in Freeport (FCX) and start using the dividends to buy more shares, or would you dither over the "end game"? If you knew the population of the US would continue to increase for the forseeable future, while the supply of land would remain fixed, what would that say about the price of residential RE?

    Another key thing your simplistic comment omits is how elastic the supply is.

    I am truly sorry that a short, off the cuff, observation in a combox was not accompanied by a detailed analysis of the total US housing supply on a county-by-county basis, however you are not paying me for that work. There are limits to what I am willing to do for free.

    One thing which contributes to the boom/bust aspect of real estate is the lag time involved in getting new housing approved and then building it.

    I already pointed out to you the current push to rewrite local zoning laws; specifically single-family-residence zoning has been declared to be borderline racist. If I can tear down a couple of older houses in my neighborhood and replace them with duplexes, triplexes or quadplexes then the total residential RE in my neighborhood will increase. Rentals tend to have less stable inhabitants, especially Section 8 cases. Thus shifting my area from all single family RE to mixed with multi-family RE will also tend make the remaining single family RE less desirable to many people, and would likely induce a few families to move to the new development of single family RE that's about 1 mile away. The builder of that development would make a profit selling single family RE. If someone had bought all the houses while they were under construction, that someone could sell for a profit also.

    Do you see, yet, how BlackRock can make money buying now, collecting rent/lease money, then selling in some number of years? Note that this comment does not include tax issues, depreciation, maintenance contracts, landscaping contracts, or other details. Therefore you are free to scoff once again, if that's what makes you happy.

    Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    This is an intelligent statement. Knowing the zip codes BlackRock is buying into would be interesting and actionable.

    P.S. Triteleia Laxa’s comment about mortgages is relevant.

    Comments from obvious trolls are generally not relevant to even a slightly serious discussion.

    Replies: @res

    (lots of non-constructive wrangling about who understands Micro 101 and who does not)

    The demand curve I mentioned encapsulates most of what you said there (and you were the one who introduced the oversimplification of a single price with your Micro 101 link). That you think the supply curve is not important enough to discuss in a conversation of the length we are having says a lot about you, none good. As does your ridiculous hyperbole: “detailed analysis of the total US housing supply on a county-by-county basis.”

    I already pointed out to you the current push to rewrite local zoning laws; specifically single-family-residence zoning has been declared to be borderline racist. If I can tear down a couple of older houses in my neighborhood and replace them with duplexes, triplexes or quadplexes then the total residential RE in my neighborhood will increase. Rentals tend to have less stable inhabitants, especially Section 8 cases. Thus shifting my area from all single family RE to mixed with multi-family RE will also tend make the remaining single family RE less desirable to many people, and would likely induce a few families to move to the new development of single family RE that’s about 1 mile away. The builder of that development would make a profit selling single family RE. If someone had bought all the houses while they were under construction, that someone could sell for a profit also.

    I did not give those points enough attention (IIRC correctly you were less explicit then). Not sure if they are sufficient, but they definitely add to the argument. Thanks. BTW, that is the kind of thing I mean by “end game.” In this case the next step after buying and renting out (as opposed to simply selling at some point).

    I found this link from another comment thread useful:
    http://dissident-mag.com/2021/06/14/blackrock-is-waging-war-on-american-home-buyers/

    You have discussed the renting out aspect before, but the willingness to raise rents (which takes advantage of the stickiness of housing, people don’t want to move) combined with the implications of your above point make the overall argument more compelling.

    At this point, I find the following analysis sufficient explanation for BlackRock’s actions here. Thanks for helping me get to this point. Anything you would add or remove? Anyone else have any thoughts?

    1. Primary purpose is buying the houses to rent with the expectation of increasing rent significantly going forward. It depends greatly on locality, but I think the assets/income hurdle issue I have is less important for renting than reselling.

    2. Converting some fraction of the single family houses to higher uses (multifamily housing or commercial). This would not only increase the value of those properties, it would also decrease the supply of competing single family homes.

    RoatanBill’s comment 42 about rent control is also worth considering in this context. Whether BlackRock really has the political power to do as he describes is an important element of this conversation. In line with that I would add 3.

    3. An important point is that BlackRock may be better able to accomplish both the raising rents part of 1. and all of 2. because of their control of greater proportions of the supply (here is my market corner idea in attenuated form) and their greater political power compared to other landlords.

    If they really can get a competitive advantage over other landlords through their scale this makes a great deal more sense IMHO.

    Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    This is an intelligent statement. Knowing the zip codes BlackRock is buying into would be interesting and actionable.

    Thanks. Being able to notice and acknowledge that helps indicate you are not a troll and have useful powers of discrimination.

    P.S. Triteleia Laxa’s comment about mortgages is relevant.

    Comments from obvious trolls are generally not relevant to even a slightly serious discussion.

    Generally, but not always. Being able to tell the difference is a useful skill. And a useful way to judge the skill of others. I contend that comment was relevant.

    P.S. I still don’t think we have a reasonable answer to: why overpay 30% rather than 5-10%? Do you think my “to use the publicity to push the market higher” idea has any merit? Or perhaps there is something really special about those properties (say in terms of redevelopment potential, or filling in a hole in an attempt to buy a contiguous block)?

    • Replies: @anon
    @res

    P.S. I still don’t think we have a reasonable answer to: why overpay 30% rather than 5-10%?

    Probably because they expect to recoup that later on. As I have already informed you. As common trading sense would tell you.

    This is not my trade. This is Blackrock's trade. This is not my trade. I have other things to do than explain a trade to you, or anyone else. Is this your trade? Do you have an equity position in Blackrock? If so, you should contact Blackrock and ask them to explain the trade. Or are you in the RE business? Perhaps you should reconsider that plan.

    This is not my trade. I have overexplained, and you asked the same question enough times that it has become abusive / trollish.

  122. res says:
    @V. K. Ovelund
    @res

    I cannot speak for anyone else but I stopped reading @anon's sophomoric walls of text early in the thread. He is obviously uninterested in having a reasonable conversation. Lacking wit, his insults do not sting.

    I just hope that Dunbar's number never overtakes this blog. AE has got such a fine crew of commenters here, it'd be a shame to see it drowned in anons.

    Replies: @res

    I stopped reading ’s sophomoric walls of text early in the thread. He is obviously uninterested in having a reasonable conversation.

    I tend to be all about Signal to Noise Ratio (SNR). I am willing to put up with a good deal of noise if I get a meaningful signal in return. In this case I think I did. Sometimes I waste a lot of time with no return and a bunch of annoyance. YMMV.

    I just hope that Dunbar’s number never overtakes this blog. AE has got such a fine crew of commenters here, it’d be a shame to see it drowned in anons.

    Agreed, though I am more concerned with disingenuous trolls (anon or not) than anons. The disingenuous trolls do terrible things to conversation dynamics and the cost/benefit tradeoff of reading the comments.

    Regarding Dunbar’s number, does it depend on what cues you have for remembering people (compare real life to video, to phone, to name, to individual email, to meaningful pseudonym, to short pseudonym, to numerical anon, any more?) as well as the depth/intensity of the interactions?

    • Replies: @V. K. Ovelund
    @res


    Regarding Dunbar’s number, does it depend on what cues you have for remembering people (compare real life to video, to phone, to name, to individual email, to meaningful pseudonym, to short pseudonym, to numerical anon, any more?) as well as the depth/intensity of the interactions?
     
    I do not know. My own observation however is that human relationships are generally defective without a network. You and I are both acquainted with @dfordoom; all three of us know Twinkie, @iffen, @nebulafox, Almost Missouri and RSDB, and so on. If I mistreat you this costs me the respect of the others. If a newcomer behaves badly then social pressure has a chance to reform or repel him.

    By contrast, when the number of individuals in the forum grows too large, the network ceases to mesh. After the network ceases to mesh, I can mistreat you without losing the respect of anyone except you yourself. Badly behaving newcomers arrive too quickly for social pressure to reform them, whereupon old commenters cease to find the forum an enjoyable place to hang out. The bad drive out the good.

    One Internet forum after another after another has destroyed itself by letting the number of participants grow too large.

    These are just observations. This is not my blog. I offer no advice.

    Replies: @V. K. Ovelund, @dfordoom

  123. anon[363] • Disclaimer says:

    This company appears to be mainly a Phoenix, Arizona operation. It is of interesting in this thread because they “Build to rent”. That is, they build out gated communities with all RE on ground level, no apartment towers, but the primary market is renters. Since they are in Arizona it is obvious a chunk of their customer base is going to be Boomer retirees, but I suspect more than a few Millennials are also participants. The whole “lock and leave”, “zero maintenance” idea regarding housing has merit, and it certainly is not new, but it is a bit innovative to specifically target that demographic.

    https://www.christophertoddproperties.com/

    Of course this company is very small compared to BlackRock in both size and scope. Not really even competing. But an interesting alternative.

    • Replies: @res
    @anon

    That is interesting. Any idea how it is working out in practice? What does the cost structure look like over time compared to owning a single family home? They show rent ranges for their communities, but that is hard to interpret without knowing the location.

  124. @res
    @V. K. Ovelund


    I stopped reading @anon’s sophomoric walls of text early in the thread. He is obviously uninterested in having a reasonable conversation.
     
    I tend to be all about Signal to Noise Ratio (SNR). I am willing to put up with a good deal of noise if I get a meaningful signal in return. In this case I think I did. Sometimes I waste a lot of time with no return and a bunch of annoyance. YMMV.

    I just hope that Dunbar’s number never overtakes this blog. AE has got such a fine crew of commenters here, it’d be a shame to see it drowned in anons.
     
    Agreed, though I am more concerned with disingenuous trolls (anon or not) than anons. The disingenuous trolls do terrible things to conversation dynamics and the cost/benefit tradeoff of reading the comments.

    Regarding Dunbar's number, does it depend on what cues you have for remembering people (compare real life to video, to phone, to name, to individual email, to meaningful pseudonym, to short pseudonym, to numerical anon, any more?) as well as the depth/intensity of the interactions?

    Replies: @V. K. Ovelund

    Regarding Dunbar’s number, does it depend on what cues you have for remembering people (compare real life to video, to phone, to name, to individual email, to meaningful pseudonym, to short pseudonym, to numerical anon, any more?) as well as the depth/intensity of the interactions?

    I do not know. My own observation however is that human relationships are generally defective without a network. You and I are both acquainted with ; all three of us know Twinkie, , @nebulafox, Almost Missouri and RSDB, and so on. If I mistreat you this costs me the respect of the others. If a newcomer behaves badly then social pressure has a chance to reform or repel him.

    By contrast, when the number of individuals in the forum grows too large, the network ceases to mesh. After the network ceases to mesh, I can mistreat you without losing the respect of anyone except you yourself. Badly behaving newcomers arrive too quickly for social pressure to reform them, whereupon old commenters cease to find the forum an enjoyable place to hang out. The bad drive out the good.

    One Internet forum after another after another has destroyed itself by letting the number of participants grow too large.

    These are just observations. This is not my blog. I offer no advice.

    • Agree: res, dfordoom
    • Replies: @V. K. Ovelund
    @V. K. Ovelund

    This is not the most tactful thing I have ever written:


    ... all three of us know Twinkie, @iffen, ...
     
    Someone like, say, DanHessinMD or Wency or ... might wonder why his name was left off the list! There is no reason, though. Arbitrary. The point is that we get to know one another mutually, which is a fine thing. Dunbar puts a limit on it.

    Replies: @res

    , @dfordoom
    @V. K. Ovelund


    By contrast, when the number of individuals in the forum grows too large, the network ceases to mesh. After the network ceases to mesh, I can mistreat you without losing the respect of anyone except you yourself. Badly behaving newcomers arrive too quickly for social pressure to reform them, whereupon old commenters cease to find the forum an enjoyable place to hang out. The bad drive out the good.
     
    Yes. And people just don't feel comfortable interacting with too many unfamiliar people. In a relatively small group you get used to the idiosyncrasies of the other members of the group. You're less likely to take offence at things a person says once you get used to the fact that that's just one of Commenter X's little quirks.

    But on the other hand you do need some new blood. The trick is to attract new blood, but not too much new blood at a time. Enough new blood to maintain the size of the group at an optimum level.

    I think AE's blog is pretty much ideal at the moment. There are just enough regular commenters to keep things interesting.

    Replies: @iffen

  125. @V. K. Ovelund
    @res


    Regarding Dunbar’s number, does it depend on what cues you have for remembering people (compare real life to video, to phone, to name, to individual email, to meaningful pseudonym, to short pseudonym, to numerical anon, any more?) as well as the depth/intensity of the interactions?
     
    I do not know. My own observation however is that human relationships are generally defective without a network. You and I are both acquainted with @dfordoom; all three of us know Twinkie, @iffen, @nebulafox, Almost Missouri and RSDB, and so on. If I mistreat you this costs me the respect of the others. If a newcomer behaves badly then social pressure has a chance to reform or repel him.

    By contrast, when the number of individuals in the forum grows too large, the network ceases to mesh. After the network ceases to mesh, I can mistreat you without losing the respect of anyone except you yourself. Badly behaving newcomers arrive too quickly for social pressure to reform them, whereupon old commenters cease to find the forum an enjoyable place to hang out. The bad drive out the good.

    One Internet forum after another after another has destroyed itself by letting the number of participants grow too large.

    These are just observations. This is not my blog. I offer no advice.

    Replies: @V. K. Ovelund, @dfordoom

    This is not the most tactful thing I have ever written:

    … all three of us know Twinkie, , …

    Someone like, say, DanHessinMD or Wency or … might wonder why his name was left off the list! There is no reason, though. Arbitrary. The point is that we get to know one another mutually, which is a fine thing. Dunbar puts a limit on it.

    • Replies: @res
    @V. K. Ovelund

    That can be a problem. I think the benefit of making examples real and concrete outweighs the cost there. YMMV.

    From your comment history it looks like you arrived just after Ron started the gold star thing. You might find these threads an interesting read. I think they are relevant to both of your comments (the first is exceedingly long though).
    https://www.unz.com/announcement/elevating-excellent-commenters/
    https://www.unz.com/announcement/open-threads-and-other-commenting-changes/

  126. @anon
    This company appears to be mainly a Phoenix, Arizona operation. It is of interesting in this thread because they "Build to rent". That is, they build out gated communities with all RE on ground level, no apartment towers, but the primary market is renters. Since they are in Arizona it is obvious a chunk of their customer base is going to be Boomer retirees, but I suspect more than a few Millennials are also participants. The whole "lock and leave", "zero maintenance" idea regarding housing has merit, and it certainly is not new, but it is a bit innovative to specifically target that demographic.

    https://www.christophertoddproperties.com/

    Of course this company is very small compared to BlackRock in both size and scope. Not really even competing. But an interesting alternative.

    Replies: @res

    That is interesting. Any idea how it is working out in practice? What does the cost structure look like over time compared to owning a single family home? They show rent ranges for their communities, but that is hard to interpret without knowing the location.

  127. res says:
    @V. K. Ovelund
    @V. K. Ovelund

    This is not the most tactful thing I have ever written:


    ... all three of us know Twinkie, @iffen, ...
     
    Someone like, say, DanHessinMD or Wency or ... might wonder why his name was left off the list! There is no reason, though. Arbitrary. The point is that we get to know one another mutually, which is a fine thing. Dunbar puts a limit on it.

    Replies: @res

    That can be a problem. I think the benefit of making examples real and concrete outweighs the cost there. YMMV.

    From your comment history it looks like you arrived just after Ron started the gold star thing. You might find these threads an interesting read. I think they are relevant to both of your comments (the first is exceedingly long though).
    https://www.unz.com/announcement/elevating-excellent-commenters/
    https://www.unz.com/announcement/open-threads-and-other-commenting-changes/

  128. @V. K. Ovelund
    @res


    Regarding Dunbar’s number, does it depend on what cues you have for remembering people (compare real life to video, to phone, to name, to individual email, to meaningful pseudonym, to short pseudonym, to numerical anon, any more?) as well as the depth/intensity of the interactions?
     
    I do not know. My own observation however is that human relationships are generally defective without a network. You and I are both acquainted with @dfordoom; all three of us know Twinkie, @iffen, @nebulafox, Almost Missouri and RSDB, and so on. If I mistreat you this costs me the respect of the others. If a newcomer behaves badly then social pressure has a chance to reform or repel him.

    By contrast, when the number of individuals in the forum grows too large, the network ceases to mesh. After the network ceases to mesh, I can mistreat you without losing the respect of anyone except you yourself. Badly behaving newcomers arrive too quickly for social pressure to reform them, whereupon old commenters cease to find the forum an enjoyable place to hang out. The bad drive out the good.

    One Internet forum after another after another has destroyed itself by letting the number of participants grow too large.

    These are just observations. This is not my blog. I offer no advice.

    Replies: @V. K. Ovelund, @dfordoom

    By contrast, when the number of individuals in the forum grows too large, the network ceases to mesh. After the network ceases to mesh, I can mistreat you without losing the respect of anyone except you yourself. Badly behaving newcomers arrive too quickly for social pressure to reform them, whereupon old commenters cease to find the forum an enjoyable place to hang out. The bad drive out the good.

    Yes. And people just don’t feel comfortable interacting with too many unfamiliar people. In a relatively small group you get used to the idiosyncrasies of the other members of the group. You’re less likely to take offence at things a person says once you get used to the fact that that’s just one of Commenter X’s little quirks.

    But on the other hand you do need some new blood. The trick is to attract new blood, but not too much new blood at a time. Enough new blood to maintain the size of the group at an optimum level.

    I think AE’s blog is pretty much ideal at the moment. There are just enough regular commenters to keep things interesting.

    • Agree: V. K. Ovelund
    • Replies: @iffen
    @dfordoom

    I agree with much of what you and others here have to say on this subject. I also like A.K.' policy of not allowing anonymous comments. I have all anons on my CTI list and the only time I ever read them is if they tag my comment or there is a discussion among/between commenters that I recognize.

    A personal note that I want to add is that the comment section is endlessly fascinating to me because I can "see" that we are looking at the same "facts", "histories", political happenings, etc. and yet we often come to very different evaluations and conclusions.

  129. @dfordoom
    @V. K. Ovelund


    By contrast, when the number of individuals in the forum grows too large, the network ceases to mesh. After the network ceases to mesh, I can mistreat you without losing the respect of anyone except you yourself. Badly behaving newcomers arrive too quickly for social pressure to reform them, whereupon old commenters cease to find the forum an enjoyable place to hang out. The bad drive out the good.
     
    Yes. And people just don't feel comfortable interacting with too many unfamiliar people. In a relatively small group you get used to the idiosyncrasies of the other members of the group. You're less likely to take offence at things a person says once you get used to the fact that that's just one of Commenter X's little quirks.

    But on the other hand you do need some new blood. The trick is to attract new blood, but not too much new blood at a time. Enough new blood to maintain the size of the group at an optimum level.

    I think AE's blog is pretty much ideal at the moment. There are just enough regular commenters to keep things interesting.

    Replies: @iffen

    I agree with much of what you and others here have to say on this subject. I also like A.K.’ policy of not allowing anonymous comments. I have all anons on my CTI list and the only time I ever read them is if they tag my comment or there is a discussion among/between commenters that I recognize.

    A personal note that I want to add is that the comment section is endlessly fascinating to me because I can “see” that we are looking at the same “facts”, “histories”, political happenings, etc. and yet we often come to very different evaluations and conclusions.

  130. anon[311] • Disclaimer says:
    @res
    @anon


    (lots of non-constructive wrangling about who understands Micro 101 and who does not)
     
    The demand curve I mentioned encapsulates most of what you said there (and you were the one who introduced the oversimplification of a single price with your Micro 101 link). That you think the supply curve is not important enough to discuss in a conversation of the length we are having says a lot about you, none good. As does your ridiculous hyperbole: "detailed analysis of the total US housing supply on a county-by-county basis."

    I already pointed out to you the current push to rewrite local zoning laws; specifically single-family-residence zoning has been declared to be borderline racist. If I can tear down a couple of older houses in my neighborhood and replace them with duplexes, triplexes or quadplexes then the total residential RE in my neighborhood will increase. Rentals tend to have less stable inhabitants, especially Section 8 cases. Thus shifting my area from all single family RE to mixed with multi-family RE will also tend make the remaining single family RE less desirable to many people, and would likely induce a few families to move to the new development of single family RE that’s about 1 mile away. The builder of that development would make a profit selling single family RE. If someone had bought all the houses while they were under construction, that someone could sell for a profit also.
     
    I did not give those points enough attention (IIRC correctly you were less explicit then). Not sure if they are sufficient, but they definitely add to the argument. Thanks. BTW, that is the kind of thing I mean by "end game." In this case the next step after buying and renting out (as opposed to simply selling at some point).

    I found this link from another comment thread useful:
    http://dissident-mag.com/2021/06/14/blackrock-is-waging-war-on-american-home-buyers/

    You have discussed the renting out aspect before, but the willingness to raise rents (which takes advantage of the stickiness of housing, people don't want to move) combined with the implications of your above point make the overall argument more compelling.

    At this point, I find the following analysis sufficient explanation for BlackRock's actions here. Thanks for helping me get to this point. Anything you would add or remove? Anyone else have any thoughts?

    1. Primary purpose is buying the houses to rent with the expectation of increasing rent significantly going forward. It depends greatly on locality, but I think the assets/income hurdle issue I have is less important for renting than reselling.

    2. Converting some fraction of the single family houses to higher uses (multifamily housing or commercial). This would not only increase the value of those properties, it would also decrease the supply of competing single family homes.

    RoatanBill's comment 42 about rent control is also worth considering in this context. Whether BlackRock really has the political power to do as he describes is an important element of this conversation. In line with that I would add 3.

    3. An important point is that BlackRock may be better able to accomplish both the raising rents part of 1. and all of 2. because of their control of greater proportions of the supply (here is my market corner idea in attenuated form) and their greater political power compared to other landlords.

    If they really can get a competitive advantage over other landlords through their scale this makes a great deal more sense IMHO.

    Of course, this varies hugely by location. It would be interesting to see an analysis of the areas where BlackRock is choosing to invest heavily.

    This is an intelligent statement. Knowing the zip codes BlackRock is buying into would be interesting and actionable.
     
    Thanks. Being able to notice and acknowledge that helps indicate you are not a troll and have useful powers of discrimination.

    P.S. Triteleia Laxa’s comment about mortgages is relevant.

    Comments from obvious trolls are generally not relevant to even a slightly serious discussion.
     
    Generally, but not always. Being able to tell the difference is a useful skill. And a useful way to judge the skill of others. I contend that comment was relevant.

    P.S. I still don't think we have a reasonable answer to: why overpay 30% rather than 5-10%? Do you think my "to use the publicity to push the market higher" idea has any merit? Or perhaps there is something really special about those properties (say in terms of redevelopment potential, or filling in a hole in an attempt to buy a contiguous block)?

    Replies: @anon

    P.S. I still don’t think we have a reasonable answer to: why overpay 30% rather than 5-10%?

    Probably because they expect to recoup that later on. As I have already informed you. As common trading sense would tell you.

    This is not my trade. This is Blackrock’s trade. This is not my trade. I have other things to do than explain a trade to you, or anyone else. Is this your trade? Do you have an equity position in Blackrock? If so, you should contact Blackrock and ask them to explain the trade. Or are you in the RE business? Perhaps you should reconsider that plan.

    This is not my trade. I have overexplained, and you asked the same question enough times that it has become abusive / trollish.

  131. res says:

    Probably because they expect to recoup that later on.

    That has to be the answer (well, along with the variant, or lose less money than the alternatives in bad scenarios). But it is not REALLY an answer. Just a lead in to “how?” and “why was it necessary?”

    I gave two possible answers for the latter just after the part you quoted.

    Do you think my “to use the publicity to push the market higher” idea has any merit? Or perhaps there is something really special about those properties (say in terms of redevelopment potential, or filling in a hole in an attempt to buy a contiguous block)?

    Our conversation has sufficiently answered the “how” for me, but I am still curious about the “why?” Why overpay unless you have to? And why would they have to?

    In case it is not obvious, I am not a fan of superficial “answers” which don’t really explain anything. When I get them I keep asking questions. It is perfectly reasonable for you to say something like “my answer is good enough for me and I don’t know or care about going any deeper.”

    P.S. I really should have included the baseline reasons of diversification and inflation hedge in my overall assessment.

    • Replies: @res
    @res

    This article made some points which I think are worth including here.
    https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html


    corporate investors snapped up 15 percent of U.S. homes for sale in the first quarter of this year
    ...
    While normal people typically pay a mortgage interest rate between 2 percent and 4 percent these days, Invitation Homes can borrow money for far less: It’s getting billion-dollar loans at interest rates around 1.4 percent. In practice, this means that Invitation Homes can afford to tack on an extra $5,000 to $20,000 to the purchase price of every home, while getting the house at the same actual cost as a typical homeowner.
    ...
    According to a recent SEC disclosure, Invitation Homes’ portfolio of homes is worth of total of $16 billion (after renovations), and the company collects about $1.9 billion in rent per year. That means it takes only about eight years of rental payments to pay back a typical house that Invitation Homes has bought. The usual rule of thumb for evaluating a fair sale price, says Kundan Kishor, professor of economics at University of Wisconsin-Milwaukee, “is that price to rent ratios are around 20 to 1.”
    ...
    They’re really buying up the stock of relatively inexpensive single-family homes built since the 1970s in growing metro areas. They mostly ignore bigger and more expensive houses, especially ones that are move-in ready: Wealthy boomers and the nation’s finance and tech bros nab those properties. And they’re also ignoring cities with stable or shrinking populations, like Providence and Pittsburgh.

    But investors are depleting the inventory of the precise houses that might otherwise be obtainable for younger, working- and middle-class households, in the cities where those workers can easily find good-paying jobs
    ...
    As Invitation Homes tells its investors, “We operate in markets with strong demand drivers, high barriers to entry, and high rent growth potential.”
     
  132. @V. K. Ovelund

    If the Fed had any intention of raising rates, BlackRock wouldn’t be paying 30% above asking for houses.
     
    Yes, I smell a rat.

    The book on BlackRock has (literally, as far as I can see) not been written yet. When it has, I mean to buy and read it.

    Whether BlackRock is a principal player or not, I suspect that the U.S. Treasury is being looted. Esoteric mechanisms appear to exist, like the U.S. Exchange Stabilization Fund, to move tens or even hundreds of billions of dollars in newly-printed cash, quickly, to various places for various ostensible purposes. That the public (including me) does not yet grasp the details is obvious. The public's lack of grasp of details seems likely to afford scoundrels an untoward opportunity to profit.

    However, some right-of-center online commenters (though maybe less so here in this blog) shoot from the hip at such topics, so to speak. I'd like to get my facts right, first, so I can shoot straight.

    Does any reader know of a good analysis of the topic by a knowledgeable, thorough writer? Ellen Brown's article is still the best I've seen, but after following her various hyperlinks I still seek an even better article or report. I want to know who is looting the Treasury and how: the more detail, the better. Alternately, if no one is looting the Treasury, then I would like a clear explanation of what is going on.

    Replies: @Audacious Epigone, @Ralph B. Seymour

    Looting the treasury insinuates there is physical treasure there to loot.

    • Replies: @V. K. Ovelund
    @Audacious Epigone


    Looting the treasury insinuates there is physical treasure there to loot.
     
    Well, whatever is in the treasury, when the suspect emerges from the vault's door, he's carrying a fabulous quantity of loot in his arms, somehow.

    Seriously, though, I share your misgivings regarding the prudence of an MMT fiat monetary system, partly for some of the very reasons you have stated.

  133. @V. K. Ovelund

    If the Fed had any intention of raising rates, BlackRock wouldn’t be paying 30% above asking for houses.
     
    Yes, I smell a rat.

    The book on BlackRock has (literally, as far as I can see) not been written yet. When it has, I mean to buy and read it.

    Whether BlackRock is a principal player or not, I suspect that the U.S. Treasury is being looted. Esoteric mechanisms appear to exist, like the U.S. Exchange Stabilization Fund, to move tens or even hundreds of billions of dollars in newly-printed cash, quickly, to various places for various ostensible purposes. That the public (including me) does not yet grasp the details is obvious. The public's lack of grasp of details seems likely to afford scoundrels an untoward opportunity to profit.

    However, some right-of-center online commenters (though maybe less so here in this blog) shoot from the hip at such topics, so to speak. I'd like to get my facts right, first, so I can shoot straight.

    Does any reader know of a good analysis of the topic by a knowledgeable, thorough writer? Ellen Brown's article is still the best I've seen, but after following her various hyperlinks I still seek an even better article or report. I want to know who is looting the Treasury and how: the more detail, the better. Alternately, if no one is looting the Treasury, then I would like a clear explanation of what is going on.

    Replies: @Audacious Epigone, @Ralph B. Seymour

    I think the Central Bank’s plan is to buy up every hard asset available. And when the dollar fails because of the printing, it will come to the rescue with CBDC.

    This is a major pillar of the Great Reset, or the New Feudalism.

    And presto, we’re all slaves.

  134. @Audacious Epigone
    @V. K. Ovelund

    Looting the treasury insinuates there is physical treasure there to loot.

    Replies: @V. K. Ovelund

    Looting the treasury insinuates there is physical treasure there to loot.

    Well, whatever is in the treasury, when the suspect emerges from the vault’s door, he’s carrying a fabulous quantity of loot in his arms, somehow.

    Seriously, though, I share your misgivings regarding the prudence of an MMT fiat monetary system, partly for some of the very reasons you have stated.

  135. res says:
    @res

    Probably because they expect to recoup that later on.
     
    That has to be the answer (well, along with the variant, or lose less money than the alternatives in bad scenarios). But it is not REALLY an answer. Just a lead in to "how?" and "why was it necessary?"

    I gave two possible answers for the latter just after the part you quoted.

    Do you think my “to use the publicity to push the market higher” idea has any merit? Or perhaps there is something really special about those properties (say in terms of redevelopment potential, or filling in a hole in an attempt to buy a contiguous block)?
     
    Our conversation has sufficiently answered the "how" for me, but I am still curious about the "why?" Why overpay unless you have to? And why would they have to?

    In case it is not obvious, I am not a fan of superficial "answers" which don't really explain anything. When I get them I keep asking questions. It is perfectly reasonable for you to say something like "my answer is good enough for me and I don't know or care about going any deeper."

    P.S. I really should have included the baseline reasons of diversification and inflation hedge in my overall assessment.

    Replies: @res

    This article made some points which I think are worth including here.
    https://slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.html

    corporate investors snapped up 15 percent of U.S. homes for sale in the first quarter of this year

    While normal people typically pay a mortgage interest rate between 2 percent and 4 percent these days, Invitation Homes can borrow money for far less: It’s getting billion-dollar loans at interest rates around 1.4 percent. In practice, this means that Invitation Homes can afford to tack on an extra $5,000 to $20,000 to the purchase price of every home, while getting the house at the same actual cost as a typical homeowner.

    According to a recent SEC disclosure, Invitation Homes’ portfolio of homes is worth of total of $16 billion (after renovations), and the company collects about $1.9 billion in rent per year. That means it takes only about eight years of rental payments to pay back a typical house that Invitation Homes has bought. The usual rule of thumb for evaluating a fair sale price, says Kundan Kishor, professor of economics at University of Wisconsin-Milwaukee, “is that price to rent ratios are around 20 to 1.”

    They’re really buying up the stock of relatively inexpensive single-family homes built since the 1970s in growing metro areas. They mostly ignore bigger and more expensive houses, especially ones that are move-in ready: Wealthy boomers and the nation’s finance and tech bros nab those properties. And they’re also ignoring cities with stable or shrinking populations, like Providence and Pittsburgh.

    But investors are depleting the inventory of the precise houses that might otherwise be obtainable for younger, working- and middle-class households, in the cities where those workers can easily find good-paying jobs

    As Invitation Homes tells its investors, “We operate in markets with strong demand drivers, high barriers to entry, and high rent growth potential.”

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