Housing cost is NUTZ in this country

[Slobrain]

OK, Here I go again,

Seems ten years ago you find a nice home in Texas for around 60K to 120K
Three to four bedroom, two-car garage and two bath on average.

Now it seems the prices of homes are thru the roof and even though there is "supposed" to be a housing market slump prices are still hi.

Then factor in the hi taxing by good ol uncle Sam and if you around the coastal area the insurance is really hi too and climbing each year.

What the hell happened here in this country? Did the Iraq war drive all this up that much? I know the storms had a bit to do with this but someone out there is using the storm idea to really jack cost of living to unreal heights.

A buddy pays $1300.00 month on rent for a two-bedroom apartment for his wife, kid, himself. I feel that is too damn hi for rent???

Back in 1994 I was renting a house and paying $450.00 a month on a two-bedroom house with its own yard and a large garage.

Now I hear folks paying $1200.00 for a one bedroom and up for rent, that’s nuts.

Why the heck is inflation rampant in this country in the past ten years???

Is it investors in the housing market or big corporations doing this?

Someone out there is getting rich and all I hear from friends are how broke they are getting by the day, and not from overspending but the regular needs, lodging, car, food and ect. Not to mention pay scale for the regular folks seem to have stagnated for the last years.

Man, I just don't know anymore about this country. I feel greed is driving most this up, starts from companies like the oil industry, Raise gas and then all other commodities follow.

Who gets hurt? The middle class, poor. Who gets rich??? I'm still trying to figure that one out. Probably most well of Republicans with over payed jobs, Just look at the congress :mad:

BTW, looks like State farm really screwed alot of the Katrina folks by not paying up on damages. There was a big ordeal on the news about this. Corporations like this should be drop kicked by our government but will they do anything? Probably not under Bush’s term :(

Where is the justice?

SLO mad as hell brain

[bob p]

Greenspan warned about runaway asset price inflation in the 1990s. There was just too much liquidity in the money supply, and too much money started chasing goods and services. Stocks skyrocketed because money was in abundance and anyone could borrow it. the cost of houses and cars have gone up faster than wages, while commodity prices stayed "stable". Everyone interpreted low commodity prices to mean that inflation wasn't a problem because people could still afford to buy food. So the fed funds rate stayed low, and money supply stayed high, thereby augmenting the cycle. Some economic gurus will even argue that the cost of housing shouldn't be included in inflation calculation figures. If I had to guess, I'd expect that you'd disagree with them.

[Satamax]

It's the same over here, it's impossible or nearly to buy in UK, so most of the brits buy in france and spain! Driving prices up! Big time, over here a house seems to double in price at least every ten years, in UK as low as two years! Well, i'd say, i'm for some type of regulation, rich or poor, one person should be only alowed to own "one" house, not many secondary homes as some do now. And i stop the rant now, because otherwise i'll go far too far! :D

[Steve Conner]

I am one of those Brits, currently paying nearly $1k/month in mortgage payments. On a one bedroom flat :eek:

I'd love to have bought a nice house in the French countryside instead, but unfortunately there aren't so many engineering jobs out there. :confused:

[drewl]

The artificial value of homes has been fueling the economy for the past few years.
We were going to look for a bigger house when the prices went insane....the value of my house doubled in less than 5 years!

Foreclosures are on the rise, maybe I can get a good deal on one of those....

[spiffpeters]

There are no simple or singular answers to the housing market.

I'm glad I'm not trying to buy a house today, as I wouldn't even be able to afford the house I live in now.

A lot of people have been cashing in the eqyuity in their homes to buy a new car, remodel the kitchen, get braces for junior and so on. The economy has done well with this consumer canabalism. But the good times will be ending soon, and with the negative savings rate for the average American family, it ain't going to be pretty.

And that doesn't even factor in the anti-bankruptcy law written by the second most profitable industry in the US, second only to oil. Credit card companies have an army of endentured servents. Many people just aren't aware of it yet. They're in for a rude awakening.

[HTH]

tell me about it - I paid £83k in 2005 for a two bedroom lower flat (in a nice area though). I could've bought the same flat two years earlier for £30k (like two of my mates did in the next street up).

:cool:

[spiffpeters]

The folks I bought from, bought the house four years earlier in 1994, for $90k. I paid $141k in 1998. I'm not sitting on a gold mine as the current value is relative to the market. And I don't know how the younger generation is going to be able to afford housing until something dramatic changes.

It's insanity. I'm sure there are some pseudo-economists, or even the real thing, 'round here that can explain the phenomenon in laymens terms. But I still don't think the rate of property value increase is sustainable over a larger period of time.

[bob p]

part of the reason for the escalation in home values where i live is related to refinancing fraud. with the abundant supply of money and cheap interest rates, people have been refinancing, and extracting the equity from their homes to pay off credit card debt. the refinance people use a convincing argument: why pay credit card interest at 25% when you can refinance at 7%, take cash out, pay off your credit card bills, and have a lower monthly payment?

the dirty little secret is that the refinancing brokers are participating in a ruse that's known as "equity theft."

i have a friend who was in the mortgage refinance business. his business was so good during the recent housing boom that he could afford to throw in the towel and retire when the Fed started to raise interest rates. his only overhead was a calculator and a pencil, and he worked for a mortgage broker age firm out of his house. he got everyone he knew to refinance, because most people snapped at the lure of lower monthly payments. it didn't matter to them that they ended up making payments for a longer period of time -- what mattered to them was a decreased monthly payment and improved cash flow.

the way that the scam works is that the banks pays the broker a 10% commission on the date of closing for any of the loans that he brings to the bank for refinancing. the bank figures that they're doubling their money (and then some), their loan is secured by accurately appraised property, and they can afford to reach into their pocket to give the broker a commission in cash that's equal to 10% of the value of the loan. yes, 10%. when my friend told me that, i fell out of my seat.

so how is it that houses became so much more expensive in such a short amount of time? friendly appraisers. the mortgage finance people always worked with friendly appraisers who would "puff up" the value of the home. a higher appraised value results in a bigger loan value for the bank (the customer goes on the hook for a bigger amount), a bigger commission for the mortgage broker (at the customer's expense) and presumably, a hefty kickback to the friendly appraiser.

when the financing is over, the person who had previously built up equity in their home has refinanced and gets a lower monthly payment, but they've lost the equity in their home. now the equity in their home has been extracted and split up among the mortgage broker, the bank and the appraiser. The Federal Rerserve calls this "unethical lending practices." In the business, its known as equity theft.

what a lot of people fail to realize is that our economy would have crashed if it had not been for people's ability to extract equity from their homes. the end result, though, is that working people are on the hook for a home that ends up costing them far more in the long run. complicating matters, the equity in their home is gone, the consumer is stretched thin, and there is no equity cushion in the home's value to fall back on.

[Slobrain]

The artificial value of homes has been fueling the economy for the past few years.
We were going to look for a bigger house when the prices went insane....the value of my house doubled in less than 5 years!

Foreclosures are on the rise, maybe I can get a good deal on one of those....


Be careful though as bigger house means more taxes to good ol Uncle Sam :(

I thought about getting one of those foreclosures too but the taxes are insane.

My house is 1251 square foot and I pay around $3,200 a year in taxes.

A buddy has a bigger home in a much nicer subdivision and he is paying $12 grand a year and that is outrageous!
Where the hell does the government in this country get off taxing the hell out of homeowners? I don't mind paying a few hundred but thousands a year. Come on....

Its time to do another (Boston Tea Party) soon :cool:

Mt rant :p

[Satamax]

Hi Bob!

That's completely forbiden over here thankfully! Laws about housing are far more stringent that you can't refinance on them. It's even hard for bankers to get the equity on one house (forbiden if it's not the house they're lending money for!) That is if i've understood what equity is. Over here it's inflation because there's too many people and not enough buildable land.

[TD_Madden]

Hate to say it, but the reason our homeower's taxes are so high is to build more schools and fund social-programs....there's been a HUGE influx of "undocumented" folks in my town in Virginia and it doesn't look like it's slowing down. I suspect that the taxes will become the major portion of my mortgage before too long, and after the house is paid-off (and I'm fixed-incomed), it will eventually force me to sell.

[Matt T.]

That 'equity theft' is very interesting...I feel fortunate that I didn't fall prey...I considered doing that but just didn't feel comfortable (I was more afraid of losing my home if I just missed a payment or something). I paid $100K for my home in '95 and my monthly payment (30 yr. mort) is only $860 (that includes escrow). I think the value is around $260K so it hasn't grown in value like many other's have. But I guess I should feel fortunate...folks around here pay way more per month for one bedroom apartments.

Regarding taxes...I understand they are necessary and I'm one of the few that says; "I'm OK with more taxes but just do it right". When I hear about the lack of funding for schools or have to stop 8x on the expressway for tolls...it's pretty obvious we're just extremely inefficient at how we tax and spend. So for me, it's not so much the amount...just the inefficiency of it that bothers me.

[spiffpeters]

We refinanced four or five years ago just to get a lower interest rate. We didn't touch the equity in the house. Our monthly payment went down about ~$125.

Right now our federal government is mismanaging our resources on such a monumental scale that I am beyond stunned. I can not explain how the fiscal insanity/unreality is allowed to continue. I image that as long as our leaders are able to scare us with cultural strawmen (gay teachers, anti-christians) and terrorism, they'll continue to be able to bleed off our resources.

[Satamax]

Be careful though as bigger house means more taxes to good ol Uncle Sam :(

I thought about getting one of those foreclosures too but the taxes are insane.

My house is 1251 square foot and I pay around $3,200 a year in taxes.

A buddy has a bigger home in a much nicer subdivision and he is paying $12 grand a year and that is outrageous!
Where the hell does the government in this country get off taxing the hell out of homeowners? I don't mind paying a few hundred but thousands a year. Come on....

Its time to do another (Boston Tea Party) soon :cool:

Mt rant :p

Whoah, here for that surface, it would be around what you pay, but 12K is unheard of! :confused:

[Satamax]

Right now our federal government is mismanaging our resources on such a monumental scale that I am beyond stunned. I can not explain how the fiscal insanity/unreality is allowed to continue. I image that as long as our leaders are able to scare us with cultural strawmen (gay teachers, anti-christians) and terrorism, they'll continue to be able to bleed off our resources. Mad, it's the same over here, make roundabouts where no road goes to or bridges with no roads :mad: And then every 50km, there's a speed cam! Oh, we're doing it for your own good, they say!

"squeal boy, squeal like a sow!" Is all i can think of when they say this!

[Regis]

I've always wondered where it will top out. My dad bought the house I grew up in in the early 1950's for around $2800. His mortgage payments were about $20 a month. I bought my house in 1995 for $84,000, last year it was appraised for over $160,000. It's nice to have equity, but like someone said, if I wanted to move, where would I go and how could I afford it?

[bob p]

another part of the reason that prices are so high is becuase everyone is leveraging borrowed money. we have an empire that is financed on debt and future earnings. its a balloon that can only grow to become so big before it pops.

here in the midwest we also have the problems with a huge undocumented population influx. because of aggressive recruitment efforts by manufacturing companies in luring cheap labor to town, we've had towns that have shifted from 95% of one ethnicity to 75% of another ethnicity in the span of a few years. when the demographics change dramatically, housing values change too -- often dramatically. one side effect of this is "urban sprawl."

lots of the people who used to live in town decide that they'd rather live on the outskirts of town, so there's a huge building boom. in just about every town i know of here in the midwest, from tiny little rural towns to the big cities, new demographic groups that are less well financed move into the "core" areas where homes are older and cheaper, and existing demographic groups who are better financed move to the outskirts and buy more expensive "new construction." there's only so much land available, and the law of supply and demand applies as you would expect.

where does it end? well, some of it has to end when people hit the wall financially, and can't afford to make payments any more. they go belly-up, and lose whatever equity (if any) they had in the house, and the bank is left holding the bag for the unpaid balance on the loan.

we had a neighbor across the street who lived beyond their means. they refinanced their home in order to pay off credit card bills (via a friendly appraiser) and lost all of their equity. as housing prices skyrocketed, every few years they refinanced and cashed out the amount of appreciation in the home's value. the solution helped their cash flow in the short term, and they repeated the trick over and over and over again and lived for years on the scammed money from the house's appreciated value. but the fix didn't last forever. eventually prices topped out, they ran out of money again and had no more equity to pull out of the house. they went bankrupt and the bank foreclosed on the home, only to find that they refinanced the home at twice the home's true value. (banks do stupid things -- they buy and sell mortage paper on homes that are sight unseen. its not uncommon for a local bank to re-fi a house whose value has been pumped up by a friendly appraiser, and then sell the note to a bank in a far away location. the bank that may be 2000 miles away buys the paper thinking that its a good deal, and they end up with non-performing debt.)

eventually, the home is sold at a loss. somebody takes a big hit, and THAT is where the reset of the housing market occurs. houses that are overpriced will remain overpriced as long as a sucker is willing to put his lifetime earnings on the hook at the inflated price. the only time that the housing price is reset is when somebody is forced to take a catastrophic loss on the property.

[bob p]

so how do you protect yourself? don't buy more than you can afford. i know its harsh to say it, but here in the midwest everyone lives beyond their means. everyone wants to put on a good show, and buy a huge fancy house that's well beyond the house that they grew up in and is well beyond what they can afford. people want to have houses and furnishings that are well beyond their means just so they can prove that they made it. one thing that they fail to realize is that not everybody can afford to live in a big fancy home, and maybe they're just deluding themselves -- maybe someone who makes what they make has no business living in a big house like that.

buying a modest home that fits your needs rather than your wants offers another form of protection for you -- it helps on your property tax bill. i have friends who paid for huge $350,000 homes during the urban relocation to the suburbs. they thought they got a good deal because they bought a really expensive home that had been forclosed and resold at a loss. what's killing them now is the property taxes. the locale grew so rapidly that they need to build all new schools, and the property taxes on their house are $30,000 per year! (why? because the middle school needs to have a TV studio!) not many people can afford that. not for long...

i am fortunate in that i live in a 50-year old house that is paid for. its fully depreciated and the taxes are half of what the new construction costs next door. my house doesn't have everything that i want, but it has everything that i really need. i've decided that its not worth putting the noose around my neck to have some things that i don't have now. i've just learned to be happy without having to indulge my delusions of grandeur.

[Mark Ingram]

Hate to say it, but the reason our homeower's taxes are so high is to build more schools and fund social-programs....there's been a HUGE influx of "undocumented" folks in my town in Virginia and it doesn't look like it's slowing down. I suspect that the taxes will become the major portion of my mortgage before too long, and after the house is paid-off (and I'm fixed-incomed), it will eventually force me to sell.

Speaking of "undocumented" folk, there are so many here (Texas) that white folk are now officially a minority!

Hmm... I wonder how to go about getting some of those minority-only business loans and grants...

[spiffpeters]

so how do you protect yourself? don't buy more than you can afford.... i've just learned to be happy without having to indulge my delusions of grandeur.

Yup. That's what folks used to do. We have a small house. Taxes are low, utility bills are relatively low (not as much space to heat and light) and I expect that I'll be able to maintain the structure on my own, or with little assistance, for many years to come.

It has everything I need, and what I don't like I can fix or change myself.

We've become a culture that has confused our needs with our wants.

[Slobrain]

Now the news is that twelve billion dollars is missing that was sent to Iraq and was carried around in bags to help who??? What??? Where???

Man, The crap with the current PIP is getting really outrageous. Twelve billion dollars missing. I think this doesn't even compare to what Bill did with Monica.
Bush and his cronies are bilking us all for all they can get. :(

Its time for impeachment in the worsted way. The current PIP needs booted out and sent to jail. Madness to the extreme.

Man, I just cannot believe this is happening here in the USA. :eek:

I don't think any of the Bush supporters here on Ampage can argue with the missing money. Heck Bill didn't even do this kind of criminal acts against the American folks!

Ranting Slobrain

[spiffpeters]

Bill lied. That's there first line of defense. That's all they need.

Seems Scooter lied too. Likely we'll never get a legal ruling on why he lied and who he was protecting.

BTW, it has been reported for over a year now that $9 billion was missing. It is only in the last few days now that the mainstream press has reported the figure to be between $9 and $12 billion.

I dunno. I think I'd take a lying politician over an incompetent politician. But that's just me.

[Earl Norton]

The current administration is made up of thieves not incompetents. Major difference.

[spiffpeters]

The current administration is made up of thieves not incompetents. Major difference.

Well, you and I can agree on this point. And I'm sure that any rational person would find it A challenge to somehow dismiss the billions of dollars that seemingly disappeared in Iraq as anything less than incompetent and likely well into criminal activity.

However, the base for this administration is pretty vocal and would see the resources of this nation squandered and our standing on the interanational stage diminished to the level of inconsequential rather than change course on any domestic or foreign concerns.

The housing market is sheer madness. And were there not other trends that seem equally unsustainable, I would simply call it a red herring. However, our standard of living can not continue at current levels. As big as the world is, there are not enough resources to allow 7 billion + people to have 3 TV's, 2.5 SUV's, 5k foot homes with central air/heating, a chicken in every pot....

A correction is in the works. The most affluent societies, not the most affluent in those societies, will likely feel the greatest sting. In order for the lower classes to elevate, the upper classes will have to come down a few notches. I don't know many folks that would take such a lifestyle change very gracefully.

Meanwhile, the manchild that has managed to make a mess out of everything he touches is telling his base that he has the answers to our problems. Funny thing is, we didn't have half the problems we have now when he first came to town. Who you gonna believe?

[Slobrain]

More ranting ;)

I read today that there may be a new tax called the (Carbon tax)?
Hmmmmmm..... Supposed to help cut back pollution! oh really...

Don't these corrupt politicians get enough money from us to squander or do they really believe that a carbon tax is going to help the green house effect going on in the world? Seems like an underhanded ploy IMHO.

Seems even if we cut back pollution here in the USA, there are other countries that are making lots of pollution to a great degree. Look at the growth of China alone, we fueled this by outsourcing millions of jobs to China and cutting blue collar throats here only to have China pumping out carbon at a hi rate now. So who's going to stop China, India and the next country we outsource jobs too from polluting?

Back a few years ago Gore talked about doing this tax but the Repubs called him crazy, now they are discussing bringing in this new tax? They say it will be put mostly on the corporations causing the most pollutants but I bet we will all pay in the long run! :(

Madness never ends with our government.

And damn Nancy quit asking for that bigass plane, you don't need it woman!!!

Just more ramblings of a soon to be insane person :cool:

SLO

BTW, I'm all for cutting back on pollution but it needs to be an equal partnership of everybody in the world to work. Not just the USA!

[Satamax]

Slo, there's some others who tried to get teh US to sign the Kyoto treaty :( So you're not alone, and wealthy countries have to give example. But when it goes to politicians, i go mad! They peel the skin of our balls, but to do what??? Waiste money, that the big one. Get richer and have more power. So they can raise more kids, kids who gonna be rich enough to raisse more kids, and they'll leave their gene mark in the gene pool! Fuck that, i'd say if you want to be in politics, get cut, you're not alowed to have kids (who wants generations of fat headed pricks who want to rule the world and have no fucking clue about what should be done in reality!) There gonna be presidential elections next may over here, they drive me nuts, either we get ultra liberal, fachist sarkozy, (if he doesn't turn dictator, i'd be astonished!) or dim "everybody is nice" socialist/ecologist Segolene Royal, Who has no fucking plan but to spend more of the overendebted france's taxes on silly thinhs like reintroducting bears in the mountains or such things! Future is not bright! :confused:

[spiffpeters]

More ranting ;) And damn Nancy quit asking for that bigass plane, you don't need it woman!!!

She didn't ask for it. The RNC and the repubs in the house tried to stir up a controversy for political purposes. Pelosi was going to travel via commercial airline, but the House Sergeant of Arms requested a military transport for The Speaker of the House just as he did for the previous Speaker Of the House.

The real story here is how hungry and angry the repubs are. They've never let facts prevent them from lashing out at a political opponent, so it should be no surprise that they aren't changing their stripes now.

Even the White House has come to Pelosi's defense. The Speaker of the House is second in succession to the President.

[Mark Ingram]

a lying politician ... an incompetent politician.

Aren't those redundencies?

I mean, whenever you hear or see the word 'politician' isn't 'liar' the first thing that comes to mind?

And if he/she were competent at anything besides lying wouldn't they be doing something besides politics?

[spiffpeters]

We have indeed become very cynical. Public service used to be an honorable aspiration.

I do believe there are some good people serving in congress today, on both sides of the isle.

When you elect politicians that have a fundmental distrust and disdain for government, you will get a government that should be distrusted and disdained. We currently have an executive administration that uses their own incompetence as proof that government doesn't work.

When you elect people that have a fundemental belief that government can be an agent for good, you will see a government that seeks to serve the greater good of its citizens.

I'll grant you that our system of government is awful. But it is better than anything else that has been tried.

[Mark Ingram]

I'll grant you that our system of government is awful. But it is better than anything else that has been tried.

I agree that our system of government is better than anything that has been tried on the planet. However, I think the only thing truly awful about our system is that the people who hold office (and power) are always the best at promoting themselves and seldom (if ever) the best for the job. If a 'good' person ever manages to get elected they are so vilified in the news media that he/she has to spend so much time defending themselves that little time/energy remain for representing the will of their constituents. It seems that anyone with honor either quits after one term or sheds some of their virtue in order to get re-elected.

[spiffpeters]

"If a 'good' person ever manages to get elected they are so vilified in the news media..."

This is why the right wing talking machine is so valuable. They slander anyone, left or right, that doesn't lineup 100% with their agenda. And their faithful minions regularly dial into to this tripe for their daily dose of outrage.

[Mark Lavelle]

Be careful though as bigger house means more taxes to good ol Uncle Sam
No, Uncle Sam does not tax real estate. But most states do <sigh>, and if you went to public school (U.S. definition) those property taxes are largely what made it (and your roads & fire houses, etc.) possible. People are always forgetting just how much they really get for their taxes...

OTOH: Yeah, housing prices have gone insane, and you can lay the vast majority of the blame on Greenspan, IMO. He was much mode concerned with keeping inflation low (for the benefit of all his Wall St. friends) than in promoting so-called 'full' employment, and those super low interest rates fueled the real estate craze.

[Earl Norton]

No, Uncle Sam does not tax real estate. But most states do <sigh>, and if you went to public school (U.S. definition) those property taxes are largely what made it (and your roads & fire houses, etc.) possible. People are always forgetting just how much they really get for their taxes...

OTOH: Yeah, housing prices have gone insane, and you can lay the vast majority of the blame on Greenspan, IMO. He was much mode concerned with keeping inflation low (for the benefit of all his Wall St. friends) than in promoting so-called 'full' employment, and those super low interest rates fueled the real estate craze.



I don't quite get your meaning. How would keeping inflation low not encourage low unemployment? In this economy how does one affect the other? The way I see it is that the ability to borrow cheap money, encourages high employment which is what we have had for quite some time.

[bob p]

OTOH: Yeah, housing prices have gone insane, and you can lay the vast majority of the blame on Greenspan, IMO. He was much mode concerned with keeping inflation low (for the benefit of all his Wall St. friends) than in promoting so-called 'full' employment, and those super low interest rates fueled the real estate craze.

I for one, agree with everything you've said. But if you remember any of my posts relating to economics, that wouldn't surprise you, Mark! :)

Celebrating a bit of a tangent that leads us back to the point (call it Greenspeak if you like) I always wondered why the TV journalists all complained that none of them could understand Greenspan. I always thought his speeches were written with sophisticated, yet clear language constructs. Although his statements were compound, anyone practiced in the skill of listening to an educated person expressing complex thoughts would have no problem following his ideas. I always thought that Greenspan's speeches were very direct and to the point -- as were expressed as directly and to the point as complex thought processes could be expressed.

To really understand why all of the journalists whined about the incomprehensibility of Greenspeak, I had to think back to my college days. The journalism majors were some of the dumbest kids I knew. They hard short attention spans that were limited to headlines and catch phrases. I guess it doesn't come to me as any sort of a surprise that the people who dish out 4 second sound bites for a living would have difficulty either understanding complex thoughts, or difficulty shoehorning complex thoughts into a sound bite. I have to admit, I'm still a bit uncertain as to wether the reported incomprehensibility of Greenspeak is due to genuine stupidity on the part of journalists, or if its to to a disingenuine desire to veto the reporting of any thoughts that are too complex to be compressed into a sound bite.

Back to the subject of the Fed's control of interest rates, I find myself repeating the same curses every time that we pass through an inflationary cycle and my "wealth" becomes eroded: The Fed is always too slow to act on raising interest rates, and they're always too liberal with monetary policy. In some respects this may be an artifact of the Fed remaining gun-shy about the prospect of repeating their biggest screw-up in history -- the Great Depression.

The Fed failed to respond with increased liquidity following the Crash of 1929, and the ripple effects were horrible. In all likelihood, they probably prefer the surriptitious erosion of wealth through inflation to the catastropic erosion of wealth in a depression. Inflation is far more insidious, and gradual erosion of peasant "wealth" doesn't cause the mob to grab their torches and pitchforks, and storm the castle.

If I were running the Fed, my primary initiative would be to decrease the time constants for Fed action. The Fed is always too slow to respond with rate hikes, and the horse has always left the barn before the door gets closed. I have to admit, I still haven't quite figured out the new Chief. Maybe I should read his book on the Great Depression.

[Mark Lavelle]

I for one, agree with everything you've said. But if you remember any of my posts relating to economics, that wouldn't surprise you, Mark! :)

Always good to hear someone agrees with me! ;)

I really do believe that one of the great things about the U.S. is the (nearly) universal opportunity to pull ourselves up by our bootstraps, but the sad fact is that the game is definitely rigged in favor of those who already have wealth...