2021 - Is inflation finally back in the conversation?

[Bozo_Casanova 26579]

3 minutes ago, jimmyjazz said:

Thanks.  I spent a good portion of my career developing and selling a low-volume, $60K-$3M product.  Now I've been developing a $600 (hopefully) high-volume product, with lower price follow-ons.  The differences in everything from mfg to mktg to sales to shipping are, as I'm sure you can imagine, massive.  I'm not quite a fish out of water but I am dangerously close to the beach.

Not just imagine/ once upon a time I was part of a team managing a product line that brought in a few billion a year at around $500 per unit. The difference is massive because you win by managing the stuff on the right side of the decimal and as you say, the launch is never over.

Seriously, good luck. 

[Bozo_Casanova 26579]

4 minutes ago, TwiceHorn said:

I had heard a number of halfway reasonable economists positing that sellers used the anomaly of Covid to raise prices, whether that was justified by the costs.

Not being intentionally obtuse, but I hear stuff like this and I don’t know what it means. What does it mean to say that sellers “used” Covid to raise prices?

[Brisketexan 105445]

Not being intentionally obtuse, but I hear stuff like this and I don’t know what it means. What does it mean to say that sellers “used” Covid to raise prices?

The anomalous event reduced resistance in consumers’ minds regarding price increases. A sudden $5 price hike in normal times? Most consumers would say “fuck that,” and turn away from the product. But when that hike happens during an unprecedented event like COVID? Consumers think “maybe that’s ok, that’s just how it be in these times.” And sellers took advantage of that. They did so in relatively unified - mayhaps even “collusive” - fashion in many instances. That’s my hypothesis for one of the elements that was in play.

[52-80 19264]

5 hours ago, jimmyjazz said:

You obviously understand this, but fatty looks out for NOBODY but himself.  Mapping citizen-like expectations to corporations means, to him, that corporations should be able to act in the most self-centered manner possible.

 

5 hours ago, jimmyjazz said:

That said, I'm only barely interested in any of this and I have a bunch of shit to do, so you win, no price-gouging, everything was on the up and up and none of y'all are sucking corporate dick.  Have a great week, I'm gonna work on our product and product launch (which happened months ago but seems to be a never-ending process).

You lamented very recently about being underpaid as a senior/experienced employee, relative to unskilled young employees.

So is it that the penile-fountainhead corporations are throwing away all of the incremental value they could extract from you, because all of their ivy league whiz kid managers don’t know any better?

Or do you overestimate your own potential, but are seeking more pay because you are a greedy individual. And if so, is that wrong for you to do?

Pls respond. 

[Bozo_Casanova 26579]

10 hours ago, Brisketexan said:

The anomalous event reduced resistance in consumers’ minds regarding price increases. A sudden $5 price hike in normal times? Most consumers would say “fuck that,” and turn away from the product. But when that hike happens during an unprecedented event like COVID? Consumers think “maybe that’s ok, that’s just how it be in these times.” And sellers took advantage of that.

Ok, but part of our response to the anomaly was (among other things) a huge money supply expansion. And when the money supply expands in an environment of constrained supply inflation is the result, 100% of the time. It’s the same thing that has happened over a much longer time span with college education. The buying power was available, and therefore the demand was available at higher price points. 
Of course sellers discovered the higher resistance range. Discovery is the function of the market. 

 

Edited July 17 by Bozo_Casanova

[jimmyjazz 46230]

7 hours ago, 52-80 said:

You lamented very recently about being underpaid as a senior/experienced employee, relative to unskilled young employees.

I did no such thing.  Go back and read what I wrote.

[Bozo_Casanova 26579]

One more thought on this topic, particularly for @Brisketexan @jimmyjazz @TwiceHorn and @Captainant - I am NOT giving the greed is good speech, or dismissing the role of avarice or the abuse of market power by producers and sellers during and following the covid crisis.  No doubt there was some of that, as there is in any crisis. But those events are typically highly localized to particular places or products or both,  and don't account for large scale monetary phenomena, and inflation qua inflation is a monetary phenomenon. 
I realize I'm taking on some ideological baggage by association when I say that. Obviously the work and words of Milton Friedman have been deployed by all kinds of bad actors for all kinds of bad shit, but contrary to the way it's used to mark yardage lines in politics, to say that inflation is a monetary phenomenon is not a value judgement but an empirical observation. It is simply damn-near impossible to find an example of economic inflation (ie a steady and sustained general rise in prices across the economy) that is not preceded and accompanied by a prior increase or debasement of the money supply. Including this one.
 

Part of why this is difficult to discuss is a failure of language - we are selective about what we call "inflation." When our wages go up due to labor shortage, we don't generally think about that as inflation until the price of things responds to our newfound buying power. When the cost of housing and healthcare and college education go up because the money supply for those things is increased in the form of cheap debt, employer tax breaks and federal profit guarantees to lenders, we don't think about it as "inflation" even though those are very much steady and sustained increase in prices preceded and accompanied by a prior  targeted increase in the money supply for those things specifically. And we don't, because  (and @Captainant this is why I responded to your question the way I did) the money supply increase doesn't have to directly pass through our hands to have an inflationary effect. The monetary expansion doesn't have to offer us a choice or agency in order to have an inflationary effect on our lives. 

And, for the record, inflation isn't necessarily bad. A low level of inflation can be beneficial to the consumer, in that is lowers the effective cost of things that appreciate over time, and it generally means that the economy is speeding up. That's what I meant about people forgetting what a recovery felt like. 21-23 was the feeling of the economy returning to normal. 

So I keep using words like "liquidity"  and "slosh" for a reason. If you pour a bunch of money into the economy, everything gets soaked. Over time that's expanded production of stuff we want. Near term, it means higher prices. Those aren't political choices or ideological positions. We do not make the political choice to get wet when we step out into the rain. 

[TwiceHorn 31564]

5 minutes ago, Bozo_Casanova said:

One more thought on this topic, particularly for @Brisketexan @jimmyjazz @TwiceHorn and @Captainant - I am NOT giving the greed is good speech, or dismissing the role of avarice or the abuse of market power by producers and sellers during and following the covid crisis.  No doubt there was some of that, as there is in any crisis. But those events are typically highly localized to particular places or products or both,  and don't account for large scale monetary phenomena, and inflation qua inflation is a monetary phenomenon. 
I realize I'm taking on some ideological baggage by association when I say that. Obviously the work and words of Milton Friedman have been deployed by all kinds of bad actors for all kinds of bad shit, but contrary to the way it's used to mark yardage lines in politics, to say that inflation is a monetary phenomenon is not a value judgement but an empirical observation. It is simply damn-near impossible to find an example of economic inflation (ie a steady and sustained general rise in prices across the economy) that is not preceded and accompanied by a prior increase or debasement of the money supply. Including this one.
 

Part of why this is difficult to discuss is a failure of language - we are selective about what we call "inflation." When our wages go up due to labor shortage, we don't generally think about that as inflation until the price of things responds to our newfound buying power. When the cost of housing and healthcare and college education go up because the money supply for those things is increased in the form of cheap debt, employer tax breaks and federal profit guarantees to lenders, we don't think about it as "inflation" even though those are very much steady and sustained increase in prices preceded and accompanied by a prior  targeted increase in the money supply for those things specifically. And we don't, because  (and @Captainant this is why I responded to your question the way I did) the money supply increase doesn't have to directly pass through our hands to have an inflationary effect. The monetary expansion doesn't have to offer us a choice or agency in order to have an inflationary effect on our lives. 

And, for the record, inflation isn't necessarily bad. A low level of inflation can be beneficial to the consumer, in that is lowers the effective cost of things that appreciate over time, and it generally means that the economy is speeding up. That's what I meant about people forgetting what a recovery felt like. 21-23 was the feeling of the economy returning to normal. 

So I keep using words like "liquidity"  and "slosh" for a reason. If you pour a bunch of money into the economy, everything gets soaked. Over time that's expanded production of stuff we want. Near term, it means higher prices. Those aren't political choices or ideological positions. We do not make the political choice to get wet when we step out into the rain. 

It's ok by me.  I have had some experiences with the stock market where some of my assumptions about price information and discovery were shaken.  It didn't involve manipulation or anything, but it did shake some of the faith I had in markets.  So I am more willing than ever to accept that markets often don't get it right and hurt people in the process.

I'm still finding my way as a recovering conservative.

Even when I was an unabashed conservative, I had some reservations about corporate behavior.

Edited July 17 by TwiceHorn

[Brisketexan 105445]

1 hour ago, Bozo_Casanova said:

One more thought on this topic, particularly for @Brisketexan @jimmyjazz @TwiceHorn and @Captainant - I am NOT giving the greed is good speech, or dismissing the role of avarice or the abuse of market power by producers and sellers during and following the covid crisis.  No doubt there was some of that, as there is in any crisis. But those events are typically highly localized to particular places or products or both,  and don't account for large scale monetary phenomena, and inflation qua inflation is a monetary phenomenon. 

I don't disagree with your take, broadly.  What I am suggesting -- and clearly, this is a hypothesis still, as it will take years/decades to tease out everything that went on -- is that we all need to use our imagination a bit more and open our mind to the fact that COVID presented an economic situation that was unprecedented, chaotic, had multiple very influential inputs, and thus is really hard to model/pigeonhole.  In shorthand, COVID fucked with our collective brains, and decisions were made on the seller and buyer side that don't necessarily match up with prior/expected patterns of conduct.  And, they were widespread, so they were the opposite of "localized."

I don't disagree that a lot of the expected factors were ALSO in play (supply constraint of goods + increased supply of money, etc.).  It's a complex picture, I just think that some human greed factored in more than we might expect because 1) the opportunity was there, 2) the opportunity was on a massive (truly global) scale, and 3) the other side of the equation (consumers) had so much unprecedented info to process that they weren't as resistant as they otherwise would have been to such upward volatility.

All of that is to say that 10+ years from now, when enough trend lines have settled and an objective post-mortem can be done, I hypothesize we'll find that some unusually broad-based greed, met with little resistance from confused consumers, which begets even more predatory pricing to take advantage of it, played a larger-than-usual role in overall inflation.

[Incredulity 11683]

Thats the stupidest post you have ever made.  Christ, what a middling piece of half assed mushy lawyer bullshit.

[Brisketexan 105445]

Thats the stupidest post you have ever made.  Christ, what a middling piece of half assed mushy lawyer bullshit.

Fair.
But it actually fits with my point - economic behavior is a half-assed mushy thing (the dismal science and all that), particularly in this case. The economic event that was COVID doesn’t lend itself to hard and fast proven rules across the board, because it was pretty damned black swan-ish. Weird things were in play, human psychology on a large and unusually monolithic scale among them.

[Gil Bang 26049]

my MIL is bitching that Biden is causing her grocery bill to go up.

She shops at Publix.  Their profits are up 50%.  Did they do something to increase efficiency to improve their profits?  Fuck no, they jacked up their fucking markups. 

[elfenix 34338]

16 hours ago, Bozo_Casanova said:

Ok, but part of our response to the anomaly was (among other things) a huge money supply expansion. And when the money supply expands in an environment of constrained supply inflation is the result, 100% of the time. It’s the same thing that has happened over a much longer time span with college education. The buying power was available, and therefore the demand was available at higher price points. 
Of course sellers discovered the higher resistance range. Discovery is the function of the market. 

 

PQ=MV, so, no, it does not necessarily follow that an expansion of the money supply leads to increased prices on a constant or even falling stock of goods/services. the big jump in the money supply happened in the first half of 2020. V fell 21% in the first quarter of 2020. inflation didn't really start firing off until spring of 2021, when real economic factors such as demand for oil rebounded from pandemic lows (while supply was slower to rebuild).

iirc, friedman thought V was static.  it's down 38% from its high in 1997

Edited July 18 by elfenix

[Bozo_Casanova 26579]

7 hours ago, elfenix said:

PQ=MV, so, no, it does not necessarily follow that an expansion of the money supply leads to increased prices on a constant or even falling stock of goods/services. the big jump in the money supply happened in the first half of 2020. V fell 21% in the first quarter of 2020. inflation didn't really start firing off until spring of 2021, when real economic factors such as demand for oil rebounded from pandemic lows (while supply was slower to rebuild).

iirc, friedman thought V was static*.  it's down 38% from its high in 1997

I don’t disagree with any of that. An expansion of the money supply doesn’t necessarily precipitate inflation, but it’s observable that a steady and sustained general (ie, across the economy) rise in prices is preceded by an expansion of the money supply. 
In the example above, V fell, the money supply expanded, things opened back up and the supply rushed in to compete for goods and services that hadn’t caught up. Pretty straightforward.
 

 

 

 

*Friedman was wrong, obviously 

[Incredulity 11683]

11 hours ago, Gil Bang said:

my MIL is bitching that Biden is causing her grocery bill to go up.

She shops at Publix.  Their profits are up 50%.  Did they do something to increase efficiency to improve their profits?  Fuck no, they jacked up their fucking markups. 

Publix has had net income around 7% of revenue every year since 2017.  That is OUTSTANDING for a grocery retailer.

They had a huge outlier "net gain on sale of equity securities" in 2022 which made 2022 an outlier at 5%. In the spoiler is the relevant section from their annual report and a link to the report. 

It has nothing to do with "jacked up their fucking markups".

Spoiler

Net earnings
Net earnings were $4.3 billion or $1.31 per share, $2.9 billion or $0.86 per share and $4.4 billion or $1.28 per share in
2023, 2022 and 2021, respectively. Net earnings as a percentage of sales were 7.6%, 5.4% and 9.2% in 2023, 2022 and 2021,
respectively. Excluding the impact of net unrealized gains and losses on equity securities, net earnings would have been
$4.1 billion or $1.23 per share and 7.2% as a percentage of sales for 2023, $4.0 billion or $1.20 per share and 7.4% as a
percentage of sales for 2022 and $3.6 billion or $1.04 per share and 7.5% as a percentage of sales for 2021. Excluding the
impact of net unrealized gains on equity securities in 2023 and net unrealized losses on equity securities in 2022, the decrease in
net earnings as a percentage of sales for 2023 as compared with 2022 was primarily due to the decrease in operating profit as a
percentage of sales, partially offset by net realized gains on investments in 2023 as compared with net realized losses on
investments in 2022 and the increase in interest and dividend income. Excluding the impact of net unrealized losses on equity
securities in 2022 and net unrealized gains on equity securities in 2021, net earnings as a percentage of sales for 2022 as
compared with 2021 remained relatively unchanged.
Non-GAAP Financial Measures
In addition to reporting financial results for 2023, 2022 and 2021 in accordance with U.S. generally accepted accounting
principles (GAAP), the Company presents net earnings and earnings per share excluding the impact of equity securities being
measured at fair value with net unrealized gains and losses from changes in the fair value recognized in earnings (fair value
adjustment). These measures are not in accordance with, or an alternative to, GAAP. The Company excludes the impact of the
fair value adjustment since it is primarily due to temporary equity market fluctuations that do not reflect the Company’s
operations. The Company believes this information is useful in providing period-to-period comparisons of the results of
operations. Following is a reconciliation of net earnings to net earnings excluding the impact of the fair value adjustment for
2023, 2022 and 2021:
2023 2022 2021
(Amounts are in millions, except per share amounts)
Net earnings $ 4,349 2,918 4,412
Fair value adjustment, due to net unrealized (gain) loss,
on equity securities held at end of year (398) 1,516 (1,109)
Net gain on sale of equity securities previously
recognized through fair value adjustment 48 — 9
Income tax expense (benefit) (1) 90 (385) 280
Net earnings excluding impact of fair value adjustment $ 4,089 4,049 3,592
Weighted average shares outstanding 3,320 3,379 3,447
Earnings per share excluding impact of fair value
adjustment $ 1.23 1.20 1.04
(1) Income tax expense (benefit) is based on the Company’s combined federal and state statutory income tax rates.
12

https://www.publixstockholder.com/financial-information-and-filings/annual-meeting-and-proxy

[Bozo_Casanova 26579]

1 hour ago, Incredulity said:

Publix has had net income around 7% of revenue every year since 2017.  That is OUTSTANDING for a grocery retailer.

That’s crazy. That’s like 2X+ the norm

[Incredulity 11683]

12 minutes ago, Bozo_Casanova said:

That’s crazy. That’s like 2X+ the norm

non-union ESOP that executes very, very well.

[jimmyjazz 46230]

13 hours ago, Gil Bang said:

my MIL is bitching that Biden is causing her grocery bill to go up.

She shops at Publix.  Their profits are up 50%.  Did they do something to increase efficiency to improve their profits?  Fuck no, they jacked up their fucking markups. 

Oh boy, here . . . we . . . go!

[Incredulity 11683]

1 minute ago, jimmyjazz said:

Oh boy, here . . . we . . . go!

its all right there in black and white in their annual reports that are publicly available.

[jimmyjazz 46230]

1 minute ago, Incredulity said:

its all right there in black and white in their annual reports that are publicly available.

Not arguing that in the least.  Just reacting to the latest molotov cocktail thrown into the discussion.

[Bozo_Casanova 26579]

47 minutes ago, Incredulity said:

non-union ESOP that executes very, very well.

Employees own like 80% of the company right? 

[ChickenSandwich 9854]

49 minutes ago, Bozo_Casanova said:

Employees own like 80% of the company right? 

Publix Super Markets, Inc., commonly known as Publix, is an employee-owned American supermarket chain headquartered in Lakeland, Florida.^[1] Founded in 1930 by George W. Jenkins, Publix is a private corporation that is wholly owned by present and past employees and members of the Jenkins family.^[5] 

 

Publix - Wikipedia

[Brisketexan 105445]

2 hours ago, ChickenSandwich said:

Publix Super Markets, Inc., commonly known as Publix, is an employee-owned American supermarket chain headquartered in Lakeland, Florida.^[1] Founded in 1930 by George W. Jenkins, Publix is a private corporation that is wholly owned by present and past employees and members of the Jenkins family.^[5] 

 

Publix - Wikipedia

So...it's not publixly owned?

[Bozo_Casanova 26579]

 

 

[fattyflattie 4638]

8 hours ago, Incredulity said:

its all right there in black and white in their annual reports that are publicly available.

Yeah but fuck all those.  You’d have to know how to read it - why not just listen to this dudes MIL? 

[Captainant 27828]

Re: when is a company crossing the line? Probably when they're shifting their business strategy to ensure more outages happen so they can continuously increase rates

https://www.khou.com/article/news/investigations/centerpoint-bill-hurricane-beryl/285-9ae6118f-51f6-40b4-bd75-a9d8894cff11

"If I spend $1 on prevention, tree maintenance, cutting the trees down, I make two or three cents," Hirs said. "But if I spent $100 on disaster recovery, I'm going to make a significantly much greater profit. Therefore, we (utilities) kind of wait for disaster to strike."

[Incredulity 11683]

Unsurprisingly you represent that quote as coming from the utility.  Of course, it doesn’t.  Fucking socialist clown.

[Captainant 27828]

4 hours ago, Incredulity said:

Unsurprisingly you represent that quote as coming from the utility.  Of course, it doesn’t.  Fucking socialist clown.

I'm sorry that journalism triggers your name calling tick

[TwiceHorn 31564]

The problem there seems to be less that Centerpoint does it, but more that the PUC allows it.  

[Incredulity 11683]

2 hours ago, Captainant said:

I'm sorry that journalism triggers your name calling tick

Disingenuous fucking socialist clown.

my mistake.

[B00M 6471]

10 hours ago, Incredulity said:

Disingenuous fucking socialist clown.

my mistake.

When you have to resort to this level, you’ve lost the argument and you’re simply embarrassing yourself. 

[Incredulity 11683]

53 minutes ago, B00M said:

you’re simply embarrassing yourself. 

[UTPhil2006 3818]

On 6/1/2024 at 8:33 PM, Wally Fairway said:

September 2024?

[UTPhil2006 3818]

25 or 50 cut next Month?

[Bozo_Casanova 26579]

13 minutes ago, UTPhil2006 said:

25 or 50 cut next Month?

My guess for the last several months has been a 25bp reduction in September, and maybe another 25bps next spring. 

[bernorange 8367]

On 7/16/2024 at 7:56 PM, fattyflattie said:

...  General welfare is not and should not expected.   If a business wants to run that way, ok, they can take that gamble with the goodwill they may or may not receive.  

Panera Cares

Lulz

[LCHorn 2632]

5 hours ago, Bozo_Casanova said:

My guess for the last several months has been a 25bp reduction in September, and maybe another 25bps next spring. 

What I keep reading is that the market is betting on 25 in Sept and another 25 in Dec

[Bozo_Casanova 26579]

1 hour ago, LCHorn said:

What I keep reading is that the market is betting on 25 in Sept and another 25 in Dec

I’ve been reading that too, and I don’t understand it in the same way I didn’t understand all the people who said 6 cuts in 2024. It seems like wishcasting.

i mean I guess they could, but why would they?

[UTPhil2006 3818]

CPI in line this morning 

[Storm the Field 5302]

Headline CPI at 2.9% YOY. First time at 3.0% or below since March '21.

[hornbri 1417]

 

12 hours ago, Bozo_Casanova said:

I’ve been reading that too, and I don’t understand it in the same way I didn’t understand all the people who said 6 cuts in 2024. It seems like wishcasting.

i mean I guess they could, but why would they?

I am with you. I am in the camp that we might see only 1 rate cut this year. Until unemployment numbers really start to move they are going to keep interest rates high as long as they can. 

[Incredulity 11683]

Fundamentally, I agree a cut should not happen.  ZIRP isn’t healthy.
 

Seems to me the market set up for a freak out(short term sell off) either way.  If they cut it’s dog that caught the car, if they don’t it’s a temper tantrum.

 

 

 

 

[troph 24913]

I think a total cut of 1-2 points over time (18 months to 2 years) could be good, but the key is to then stay put. Zero rate policies are dumb (even if real estate focused businesses like ours benefit). 

[Bozo_Casanova 26579]

35 minutes ago, Storm the Field said:

Headline CPI at 2.9% YOY. First time at 3.0% or below since March '21.

 

29 minutes ago, hornbri said:

 

I am with you. I am in the camp that we might see only 1 rate cut this year. Until unemployment numbers really start to move they are going to keep interest rates high as long as they can. 

Yep- 2.9% is good enough for a symbolic move to loosen up real estate a little, but won’t get us to a second cut in 24.

20 minutes ago, Incredulity said:

Fundamentally, I agree a cut should not happen.  ZIRP isn’t healthy.

Word!

 

Troph agree with your second point below, but personally I’d like to see rates normalize for an extended period and we’re in a normal range already. I don’t know what the Fed will do, but assiming inflation continues to decline slowly it would be much better to have 400-450bps to play with in the event of a recession down the road. 

10 minutes ago, troph said:

I think a total cut of 1-2 points over time (18 months to 2 years) could be good, but the key is to then stay put. Zero rate policies are dumb (even if real estate focused businesses like ours benefit). 

Edited August 14 by Bozo_Casanova

[LCHorn 2632]

1 hour ago, Bozo_Casanova said:

I don’t know what the Fed will do, but assiming inflation continues to decline slowly it would be much better to have 400-450bps to play with in the event of a recession down the road.

I disagree (at least by degrees), but I’m also weary of using monetary policy in an attempt to steer the leviathan.  

[Bozo_Casanova 26579]

9 minutes ago, LCHorn said:

I disagree (at least by degrees), but I’m also weary of using monetary policy in an attempt to steer the leviathan.  

But that’s what we have been doing. Look, I realize this is maybe not orthodox thinking at this point, but I view the last 15 years as an aberration. I just don’t see what’s healthy about the long term use of monetary stimulus to prop up or inflate asset prices. Historically normal interest rates will do us all some good I think. 

[troph 24913]

3 hours ago, Bozo_Casanova said:

 

Yep- 2.9% is good enough for a symbolic move to loosen up real estate a little, but won’t get us to a second cut in 24.

Word!

 

Troph agree with your second point below, but personally I’d like to see rates normalize for an extended period and we’re in a normal range already. I don’t know what the Fed will do, but assiming inflation continues to decline slowly it would be much better to have 400-450bps to play with in the event of a recession down the road. 

I would agree with you but the differential between before times and now is too great. We have to be closer to the before times to allow for the market to release some. I think you hold still at a max of 2% decrease over 2 years and then look to re-balance up a tad if needed so that you can cut later. My guess is we get 1.5% over time and then further declines in another recession but no additional increases. I think the fed has created an expectation of no increases absent extenuating circumstances. It's absurd but I think it's where it is.

[StassneyHorn 6643]

Next two months have some potential headline figures. I wouldn’t dare politicize this thread for Joe B’s legacy though.

11 month CPI- 2.3%

10 month CPI- 1.9% - last one before election

 

[Bozo_Casanova 26579]

55 minutes ago, troph said:

I would agree with you but the differential between before times and now is too great. We have to be closer to the before times to allow for the market to release some.

Too great for what, though? With 5-6 months of inventory it’s a mild buyer’s market in Austin after how many years of being a seller’s market? Again I’m genuinely sympathetic to people who aren’t able to print money like they have for the last several years but this like a pretty smooth correction to me. 

[troph 24913]

4 minutes ago, Bozo_Casanova said:

Too great for what, though? With 5-6 months of inventory it’s a mild buyer’s market in Austin after how many years of being a seller’s market? Again I’m genuinely sympathetic to people who aren’t able to print money like they have for the last several years but this like a pretty smooth correction to me. 

where did I say print money?
 

I think a longer term rate differential (conventional 30 year fixed) between 2.75% and 7% is too much for the real estate market. Maybe I’m wrong. I think 5.5% to 2.75% is better. I realize fed funds is not directly related to mortgage rates but it kinda is. 

smooth correction for now but CRE isn’t in the best shape. I also think more mobility in the residential sector isn’t a bad thing. 

overall I’m not suggesting much to change now but I don’t think where we are is good for two years from now. 

 

Edited August 14 by troph