Posted On: Friday - February 17th 2023 8:12PM MST
In Topics: Economics Inflation Zhou Bai Dien
This is a point that should have been made in our initial post on the effort of Zhou Bai Dien and the Congressional Commies to implement national rent control. Those pushing this obviously unConstitutional - but who cares? - rent control will be the first to tell you the purported reason* for it is that, due to inflation, the rent is too high!
Well, we know, but they may be too stupid to know, price inflation is a given when you increase the money supply without a corresponding increase in productivity. Whatever, that "wage/price spiral" deal is not the cause but a symptom, and the rental market is not immune to that sort of thing. Costs go up, so the rent has got to go up. What are the biggest costs? Property taxes are right on up there, other than the initial cost of the property, which, of course, must be considered. You've got maintenance costs, and you've got insurance, and sometimes utility bills. (I think it best to leave those for the tenants or they will naturally be wasteful with said utilities.)
It so happens, Peak Stupidity has calculated some numbers that apply in various old posts. In Checking in on Housing Bubble 2.0- Bubble or just high inflation?, we saw a 7.6% annual compounded** inflation rate in the '12-'20 period for housing in 20 American big cities. You've got to cover your payments, or if a rental house has been paid off, get your money back out in a profitable manner.
In the post Real life inflation anecdotal-data(?) beside some bean and soup calculations***, we did a calculation on the ubiquitous 2x4, as a stand-in for building materials, and came up with 3.5% - 4% (Note, this was before the recent HUGE price increases.) In On Inflation, Oil, and Roofing Shingles, we came up with a 7% average yearly increase over an 18 year period. Well, you need drywall, and paint, but I can guarantee you, especially for the latter, that they've gone way up too.
In case you cover utilities as a landlord, Peak Stupidity covered that, with just our own local example over a 22-23 year period, in Inflation Note: Utility Bills. Water/Sewer: Base Fee up 6.9%, Charge per ft3 up 4.2%. Electricity: Base Fee up 4.5%, Charge per kW-hr up 2.6%.
I haven't done house insurance calculations, but I can give you a number now based on apples-to-apples over a few decades. I got 3.3%. "Yeah, but the house has gone up." Yeah, but you still gotta pay it.
So, before the recent inflation surge due to the recent US Gov't higher-spending spree, a landlord's costs were going up 4% to 6%. He's gotta raise the rent accordingly to keep up financially. Zhou Bai Dien and the Commies are trying to prevent his doing so, just as costs are going through the (expensively-shingled) roof. This would take houses off the rental market and keep many a small guy from even getting started.
What about the big guys, the Blackrocks and the institutional investors? Won't they have a problem too? No, the lawmakers will make sure that they are exempted, because anyone who follows the new rules will be, except that these new rules will specify special legal or financial requirements that the small guy can't handle. That's the way ya' do it. Moova, moova.
* The real reasons are to gain more control of the population and help wipe out the small businessman, oh, and get votes and grift money.
** For all of these calculations, compounding has been included.
*** That's at least the 2nd time I wrote a post after having forgotten I'd written about the same point. Our recent post Inflation Note: Chicken Soup for the toll was about Campbell's soup as was one section in that "Real life..." post. I used different time frames, hence, prices, but the inflation numbers matched - average 3.5% to 3.9% yearly.
Comments:
Moderator
Sunday - February 19th 2023 1:43PM MST
PS: Thanks for writing in, Untermenschen. All of you ...
Moderator
Sunday - February 19th 2023 1:42PM MST
PS: Thanks, Alarmist. Maybe because she's already on the outs with the Lyin' Press Establishment, Miss Coulter doesn't give a dang anymore. Good to see this!
The New York Post is not too terrible:
"Coulter told Simone she was particularly angered by then-Gov. Haley’s decision to remove the Confederate flag from the grounds of South Carolina’s Statehouse following the 2015 mass shooting at a predominantly black church in Charleston." Right.
"“This is my country, lady,” Coulter said."
"“What’s with the worshipping of the cows? They’re all starving over there. Did you know they have a rat temple, where they worship rats?”
Haley’s ethnic background was fodder for left-leaning critics who took her to task for serving as UN ambassador during the presidency of Donald Trump.
Trump, who has also made controversial remarks about immigrants and foreigners, is looking to recapture the GOP nomination for president in 2024."
Trump v Coulter in a contest to properly insult ungrateful immigrants. Close match, but when it comes to getting stuff done, it's be Coulter in a knockout.
The New York Post is not too terrible:
"Coulter told Simone she was particularly angered by then-Gov. Haley’s decision to remove the Confederate flag from the grounds of South Carolina’s Statehouse following the 2015 mass shooting at a predominantly black church in Charleston." Right.
"“This is my country, lady,” Coulter said."
"“What’s with the worshipping of the cows? They’re all starving over there. Did you know they have a rat temple, where they worship rats?”
Haley’s ethnic background was fodder for left-leaning critics who took her to task for serving as UN ambassador during the presidency of Donald Trump.
Trump, who has also made controversial remarks about immigrants and foreigners, is looking to recapture the GOP nomination for president in 2024."
Trump v Coulter in a contest to properly insult ungrateful immigrants. Close match, but when it comes to getting stuff done, it's be Coulter in a knockout.
The Alarmist
Saturday - February 18th 2023 3:07PM MST
PS
https://nypost.com/2023/02/17/ann-coulter-tells-nikki-haley-go-back-to-your-own-country/
🕉
https://nypost.com/2023/02/17/ann-coulter-tells-nikki-haley-go-back-to-your-own-country/
🕉
The Alarmist
Saturday - February 18th 2023 3:04PM MST
PS
Evening, Mr. Smith.
Oh, they’ll come eventually for the New American Kulaks who were rich enough to own their property outright as the economy collapses. They might indeed keep coming at them for property taxes. It wouldn’t be prudent to immediately expropriate them, especially as they will very quickly become the objects of hatred for those dispossessed and living in government assigned. housing. War among the “classes,” so to say, limited to the classes who don’t matter.
We’ll get inflation first, big time, and anything the Fed does to attempt to control it will implode the credit-based asset bubble and result in massive demand destruction and deflation, primarily in assets. Food prices might deflate, but slower than the value of peasant labor and savings.
Evening, Mr. Smith.
Oh, they’ll come eventually for the New American Kulaks who were rich enough to own their property outright as the economy collapses. They might indeed keep coming at them for property taxes. It wouldn’t be prudent to immediately expropriate them, especially as they will very quickly become the objects of hatred for those dispossessed and living in government assigned. housing. War among the “classes,” so to say, limited to the classes who don’t matter.
We’ll get inflation first, big time, and anything the Fed does to attempt to control it will implode the credit-based asset bubble and result in massive demand destruction and deflation, primarily in assets. Food prices might deflate, but slower than the value of peasant labor and savings.
Adam Smith
Saturday - February 18th 2023 1:23PM MST
PS: Greetings, Mr. Alarmist,
“If all the commodity producing nations de-Dollarize and stop using the dollar as the intermediary currency for trade, there is less reason for the rest of the world to hold dollars and dollar-based assets like US Treasuries,” - This I understand. And I agree.
“and all those dollars “come home” to wreak havoc on the US economy.” Is there no mechanism for the FED to contract the supply of credit and currency? Are we not overdue for a deflationary period?
“Fortunately, the US is so overleveraged that the ensuing credit destruction will eventually overwhelm the coming hyperinflation.” - ???
“The middle class will be destroyed, but if they actually owned their homes, they’ll get to keep them. Rent control will be moot, because everyone else will be assigned the now government-owned housing stock, it having been nationalized from BlackRock and BlackStone and the others.”
Why wouldn’t the criminals masquerading as “government” (try to?) nationalize private homes/farms/land too? As everything that’s registered in the “property tax” and “vehicle registration” system is pledged as collateral on the glorious war debt, why wouldn’t the lizard people foreclose on these assets too? Couldn’t they simply raise the so called “property taxes” and price these lucky home “owners” out of their homes? The state holds superior title to all the fee simple property and all the registered motor vehicles, I see no reason they couldn’t finish taking off their mask and go full in your face communist. (America has effectively nullified much of the constitution and has been practicing all 10 planks to some degree for many years. They might just make it official with the next “crisis”. )
“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered.” - Often misattributed to Thomas Jefferson, real source unknown
Anyway… Thanks for the link and interesting comments.
Happy Saturday!
☮
“If all the commodity producing nations de-Dollarize and stop using the dollar as the intermediary currency for trade, there is less reason for the rest of the world to hold dollars and dollar-based assets like US Treasuries,” - This I understand. And I agree.
“and all those dollars “come home” to wreak havoc on the US economy.” Is there no mechanism for the FED to contract the supply of credit and currency? Are we not overdue for a deflationary period?
“Fortunately, the US is so overleveraged that the ensuing credit destruction will eventually overwhelm the coming hyperinflation.” - ???
“The middle class will be destroyed, but if they actually owned their homes, they’ll get to keep them. Rent control will be moot, because everyone else will be assigned the now government-owned housing stock, it having been nationalized from BlackRock and BlackStone and the others.”
Why wouldn’t the criminals masquerading as “government” (try to?) nationalize private homes/farms/land too? As everything that’s registered in the “property tax” and “vehicle registration” system is pledged as collateral on the glorious war debt, why wouldn’t the lizard people foreclose on these assets too? Couldn’t they simply raise the so called “property taxes” and price these lucky home “owners” out of their homes? The state holds superior title to all the fee simple property and all the registered motor vehicles, I see no reason they couldn’t finish taking off their mask and go full in your face communist. (America has effectively nullified much of the constitution and has been practicing all 10 planks to some degree for many years. They might just make it official with the next “crisis”. )
“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered.” - Often misattributed to Thomas Jefferson, real source unknown
Anyway… Thanks for the link and interesting comments.
Happy Saturday!
☮
Deplorable Kulak Untermenschen
Saturday - February 18th 2023 1:06PM MST
PS The old meme of the black preacher...the rent is too dayam high.
Saw a funny meme of the young unity hive collective comrades saying there were protections passed for the property owners but muh rent.
They really need to get a bigger corporate logo while burning it all down.
Rent is a construct of the white male patriarchy and in the glorious West South Africa fundamental transformation, housing will be a human right with a free rainbow stew bubble up fountain in the yard!
Yes we can.
Saw a funny meme of the young unity hive collective comrades saying there were protections passed for the property owners but muh rent.
They really need to get a bigger corporate logo while burning it all down.
Rent is a construct of the white male patriarchy and in the glorious West South Africa fundamental transformation, housing will be a human right with a free rainbow stew bubble up fountain in the yard!
Yes we can.
Moderator
Saturday - February 18th 2023 10:54AM MST
PS: Sometimes it's hard for me to wrap my mind around that financial stuff, Alarmist, but I think I get it. Re: "Speaking of our overlords, did you catch Ann Coulter telling one of our Indian overlords to go back to her country?" I gotta see that. I sure hope it's traitor to South Carolina Nikki Haley she's referring to.
Mr. Blanc, the left thinks that, but I don't think it's all over but the mopping up for them. However, no matter what gang of Conservatives could magically take control politically, the financial stuff will indeed put us in a bad state that won't be easy to get through, if at all.
Mr. Blanc, the left thinks that, but I don't think it's all over but the mopping up for them. However, no matter what gang of Conservatives could magically take control politically, the financial stuff will indeed put us in a bad state that won't be easy to get through, if at all.
MBlanc46
Saturday - February 18th 2023 10:46AM MST
PS The Left have the bit in their teeth and the wind at their backs. Everything that they’ve always wanted is now within their grasp. And they’re grasping for it. If you think that Good Old Uncle Joe from Scranton is bad, wait until we get Kneepads, or Gov. Hairgel, or Mayor Pete. There is a positive side to all this: It will crash everything sooner, and the sooner it comes, the better chance there is to salvage something. That said, for those who have to live through the crash, things will be very unpleasant.
The Alarmist
Saturday - February 18th 2023 6:31AM MST
PS
Then again, with The Great COVID die-off in progress, we may go the way of Japan:
https://www.thetimes.co.uk/article/932e1f20-ab14-11ed-a737-a480e119ff3e?shareToken=e79d817db9d7a53377d83b1bd6b8d41c
Then again, with The Great COVID die-off in progress, we may go the way of Japan:
https://www.thetimes.co.uk/article/932e1f20-ab14-11ed-a737-a480e119ff3e?shareToken=e79d817db9d7a53377d83b1bd6b8d41c
The Alarmist
Saturday - February 18th 2023 6:13AM MST
PS
In addition to the supply of money increasing, price inflation requires the velocity of money to hold constant or increase. If people park their money in assets or savings, inflation will still be there, but likely muted.
This is the danger of US sanctioning the world. If all the commodity producing nations de-Dollarize and stop using the dollar as the intermediary currency for trade, there is less reason for the rest of the world to hold dollars and dollar-based assets like US Treasuries, and all those dollars “come home” to wreak havoc on the US economy. It’s happening now, though most people, including the US leadership, are oblivious to it.
Fortunately, the US is so overleveraged that the ensuing credit destruction will eventually overwhelm the coming hyperinflation. The middle class will be destroyed, but if they actually owned their homes, they’ll get to keep them. Rent control will be moot, because everyone else will be assigned the now government-owned housing stock, it having been nationalized from BlackRock and BlackStone and the others. No need to cry for them, because they are the oligarchs who actually manage the government on behalf of our lizard-alien Satanic overlords.
Speaking of our overlords, did you catch Ann Coulter telling one of our Indian overlords to go back to her country?
In addition to the supply of money increasing, price inflation requires the velocity of money to hold constant or increase. If people park their money in assets or savings, inflation will still be there, but likely muted.
This is the danger of US sanctioning the world. If all the commodity producing nations de-Dollarize and stop using the dollar as the intermediary currency for trade, there is less reason for the rest of the world to hold dollars and dollar-based assets like US Treasuries, and all those dollars “come home” to wreak havoc on the US economy. It’s happening now, though most people, including the US leadership, are oblivious to it.
Fortunately, the US is so overleveraged that the ensuing credit destruction will eventually overwhelm the coming hyperinflation. The middle class will be destroyed, but if they actually owned their homes, they’ll get to keep them. Rent control will be moot, because everyone else will be assigned the now government-owned housing stock, it having been nationalized from BlackRock and BlackStone and the others. No need to cry for them, because they are the oligarchs who actually manage the government on behalf of our lizard-alien Satanic overlords.
Speaking of our overlords, did you catch Ann Coulter telling one of our Indian overlords to go back to her country?
Moderator
Saturday - February 18th 2023 3:52AM MST
PS: Yeah, it's unfortunate that that sort of thing happens only take-off from Washington FS Reagan field. The usual people get the "free" money first.
Adam Smith
Saturday - February 18th 2023 1:06AM MST
PS: This old meme seems apropos...
https://i.ibb.co/XXcqSM7/airplane-money.jpg
☮
https://i.ibb.co/XXcqSM7/airplane-money.jpg
☮