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Why Affordability and the Vibecession Are Real Economic Problems

https://newsletter.mikekonczal.com/p/why-affordability-and-the-vibecession
27•NomNew•1h ago

Comments

t-writescode•42m ago
> But the first step is to believe that what people have been screaming about their lives for the past several years actually exists. Even a representative agent, forward-looking and fully aware of all the parameters surrounding them, can feel the vibecession.

Gee. Who would have fucking thought.

When people, en masse, are saying they're in pain, *believe them*. They have very real fears or stressors, even if "you" can't understand them.

ajross•28m ago
It's not an economic effect. The news is all awful. If you're in the US and on the left, or outside the US, the world is descending into autocratic chaos and police state violence. If you're in the US and on the right, the country is descending into chaos at the hands of the anarchist left and the invasion of a horde of immigrants who need to be suppressed by autocratic chaos and police state violence.

Yeah yeah, there's food on the shelves and money in your pocket. But it's scary out there for everyone, and that trumps (heh) rationality.

The solution is to get Washington and partisan media to, ahem, shut the fuck up and just let people be happy. But that doesn't put bribes in their pockets or advertisers on their screens, so on with the autocratic chaos.

alephnerd•27m ago
I think it would be beneficial to conduct such analysis at a subnational level, becuase the reality is the market dynamics in the Bay Are are distinct from those in Chicagoland.

A similar macro-level analysis by the FT highlighted how certain states are in the midst of a positive economic expansion and others have fallen into a deep recessionary cycle [0].

I've also noticed HN cycles of pessimism and optimism shift significantly based on time zone - which could be attributed to this subnational malaise.

[0] - https://www.ft.com/content/e9be3e3f-2efe-42f7-b2d2-8ab3efea2...

Avicebron•19m ago
You've missed the point kiddo
alephnerd•15m ago
Not really. Different demographics and different subeconomies are feeling better or worse than others. CPI is also calculated at a subnational level as well.

Insurance, Rent, Food, and other fundamentals are all differently priced in different regions and subregions of the US,

Avicebron•9m ago
The racial diversion is tiring and hedging by "it's all relative" is boring. The article is about zeitgeist..
Avicebron•21m ago
It's weird I was having a conversation with a contractor the other day, and he mentioned how in 1970, contractors earned ~9k/year and a truck cost ~2k. He was making the comparison about how he made 50K this year and the truck he financed was also around 50K..

I don't think it's a coincidence a lot of problems are happening at the same time in the US.

alephnerd•18m ago
But back in 1970, racial barriers for hiring were still the norm and if you weren't a specific type of wife you were shit out of luck.

If you were Italian American, Portuguese American, Spanish American (not Latin American), Greek American, etc you weren't viewed as "white" in much of America until the 2000s. And Irish Americans were still treated as the "other" back then in much of the US. Having studied in Boston/Cambridge right when Slummerville's transformation took off this was a major subcurrent in ethnic relations between Italian, Irish, Domininicans, Brazilians, Ivie kiddos, and Somalis.

And that ignores African, Hispanic, and Asian Americans who were othered and were still excluded from most opportunities.

In 1970, I wouldn't have been able to work as a contractor in $9k a year in much of America and would have been forced into a redlined neighborhood where my attempt at building intergenerational wealth would have been stymied.

Edit: Cannot Reply

> Is this supposed to convince a white person

For the 42% of Americans who are non-Hispanic White [0], the reality is our life today is better than it would have been in 1970. And a large portion of non-Hispanic whites in America today would also not be counted as white back then.

> The wage gap between black and white Americans is nearly the same today as in 1970

Yep. And that's why I called out redlining - that was the original sin that has prevented a large segment of Americans from developing intergenerational wealth.

Yet we do not pay poll taxes today. We are not getting lynched in the streets.

[0] - https://usafacts.org/articles/is-the-us-becoming-more-divers...

retrac•9m ago
The wage gap between black and white Americans is nearly the same today as in 1970.
dottjt•6m ago
Not to justify this, but is this possibly the reason why those opportunities existed?
majormajor•5m ago
The 80s-and-on story of America is not a story of women and minorities getting on more solid economic footing at the cost of some additional costs for white male Americans. Almost everybody is worse off - higher debt, less property ownership among the youth, etc.

I wouldn't agree with a position of "white people aren't going to stop being racist, just separate everyone and let them be" (we could call this the Clarence Thomas position, as Corey Robin has written about[0]). But it's wildly misleading to say that the slippage of the American economy is because of less overt discrimination. It's universal. The economy itself is broken compared to how it used to be. (Personally, I'd point at the oligarch-fighting "soak the rich" taxes passed in the early 20th century as a key point here.)

[0] https://us.macmillan.com/books/9781627793834/theenigmaofclar...

majormajor•18m ago
Time for the other American political party to pick up the "nah it's just negative media, people still have money and food" drum!

Sure, many people (in an absolute-number sense) are in no immediate risk of crisis. But many are.

Economic policy for 40+ years has been shifting both income and wealth largely to the already-haves with massive knock-on effects on the general affordability and comfort for everybody else. The flow of money into small sets of assets and investments distorts the "inflation" measurements and we find ways to ignore it. Buy groceries instead of eating out! Just let the median household's kids work more too, in some red states! That part of the story has been going on for a long time, and the actual-Covid-inflation just drew more attention to the trend.

People were talking about it long before Covid, but the Covid bullwhip and the complete lack of foresight or management[0] of the situation pushed it into a new, noticably-worse-normal overnight. While before we were just boiling the frog and blaming avocado toast for millenials not buying houses or having kids yet. Some good math in the post about the concrete part of this vs just "vibe" parts, especially re: the behavior of the lower-income end of the economy.

But you can't have a viable consumer economy when everyone with power is squeezing the consumer tighter and tighter. We've been papering over this problem by making stuff free-with-ads but eventually there won't be enough buying power left in a large enough non-broke cohort to keep the system working for anybody.

[0] "you think maybe people will want more of the stuff they bought before, and less Pelotons, in a two years?? No way! Buy Zoom stock!"

randycupertino•9m ago
I saw a thing in Wall Street Journal today about how millennials are "splurging on rotisserie chicken."

> “Gen Zers and millennials are swimming in student debt and may never own homes, but they’re splurging on gut-healthy juices and rotisserie chickens.”

https://offthefrontpage.com/the-wall-street-journal-gets-com...

throwup238•6m ago
Aren’t rotisserie chickens one of the #1 grocery store loss leaders?

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