The Viral Economy

[Blackhawk]

Just to be clear, I don't shop at Walmart (or Sam's) because they have better deals. I shop there because if I didn't, I wouldn't be able to afford what I need. It's not about building up a bigger savings account for me, it's about having any money at all. And the only time I shop at Amazon anymore is when there's no comparable alternative, and I always look elsewhere first.

[YellowKing]

I gave up long ago trying to tailor my shopping based on political/work ethic reasons. There are exceptions, of course. I always support my local game store over the online retailers, ditto my local record store, provided they have what I want. But for general goods and groceries with a family of four, I do what I have to do.

[Zarathud]

Worker mistreatment doesn’t rival the Great Depression, but we hoped for things to get better. And they did, until business undermined the system and workers became replaceable again. Some industries workers were always cogs, but others it’s just recently become true. Mega software companies are on the recent side, while manufacturing had it long ago. Lots of promises were never delivered, but long ago those promises weren’t even made.

[Smoove_B]

So weird that the U.S. economy is booming and yet...

Office vacancies hit a new record high in the US, per Axios:

[Isgrimnur]

Won't someone think of the REIT investors‽

[Carpet_pissr]

Won't someone think of the REIT investors‽

Anybody with a typical/classical balanced portfolio is a REIT investor (or at least RE ETFs which are also mostly involved in commercial RE AFAIK)

[Unagi]

‽

What's this witchcraft‽

[Smoove_B]

The elite class uses interrobangs.

[Isgrimnur]

http://interrobang.dlma.com/

[Unagi]

http://interrobang.dlma.com/

It has a nice æsthetic.

[Madmarcus]

Since this is all warring anecdotes, here's a question to those who knew about how awful things were going into that world:

How did you find out prior to starting work? What was the source of this knowledge?

I'm late to the conversation but I'll bite. My source of knowledge was my dad. He's never been the most talkative person but on history, geography, and economics (including the workplace level we're talking about) he was always willing to talk. He worked for one company for his whole career but he was very open about how that wasn't the norm any more. He was also very clear about needing to always be willing to move or change to get ahead; he'd simply managed to do that within the one company. Plus a lot of discussions about salaried vs. union, college as a way to a good career but also that it didn't guarantee anything especially if you didn't chose a useful major, and the need for deferred gratification. By the late 70s I was being passively (and by the 80s not always to passively) exposed to investing as a perfectly normal thing (Wall Street Week in Review on TV and various magazines around) and the news (TV, the Sunday paper). He'd made it from a poor WV farm to a solid middle class career and wanted to make sure we started with any insight he could give us.

It was clear even then that this was not the norm although my experiences in college and soon after college seemed to indicate that it wasn't that odd among that people I ran into in college, grad school, and at my wife's industrial chemistry/engineering coworkers.

[Blackhawk]

I only got a few answers, but they all seemed to be centered around personal things (someone who intentionally taught the person), or things that most people didn't do at that age (watch the news, read the news.) Typically, only about a third of adults actively follow the news, and I can promise you that number is smaller for teens. I still say that pre-internet boom, unless you either had proactive people around you, or you had an interest/mindset that drove you to look for it, the kind of information wasn't the kind of thing that most people encountered beyond the surface level.

In other words, 30 years ago, young people knowing about corporate culture was an exception to the rule. I think it's also noteworthy that a much larger slice of the regulars on OO had the 'interest/mindset' I mentioned than you'd find in most other places. We're not a representative sample - we've always had a larger population of doctors/attorneys/writers/other professionals on OO than the norm.

Today, kids are talking about corporate culture from a younger age because the information is relevant to them. My own kids have started conversations on the topic - but every time it was in relation to a game company. That kind of relevance to the average young reader just wasn't there before. And that, combined with the fact that it is likely showing up in the form of a tweet or Facebook post built around outrage draws them in. It isn't just buried in the business section of a newspaper or talked about by a monotone, jargon-loving business reporter that most young people wouldn't have taken the time to look at if it weren't already an interest for them.

[Kraken]

I guess this is the best thread for this. Trump's tax cut fueled investment but didn't pay for itself.

The corporate tax cuts that former president Donald Trump signed into law in 2017 have boosted investment in the US economy and delivered a modest pay bump for workers, according to the most rigorous and detailed study yet of the law’s effects.

Those benefits are less than Republicans promised, though, and they have come at a high cost to the federal budget. The corporate tax cuts came nowhere close to paying for themselves, as conservatives insisted they would. Instead, they are adding more than $100 billion a year to America’s $34 trillion-and-growing national debt, according to the quartet of researchers from Princeton University, the University of Chicago, Harvard University, and the Treasury Department.

The researchers found the cuts delivered wage gains that were “an order of magnitude below” what Trump officials predicted: about $750 per worker per year on average over the long run, compared with promises of $4,000 to $9,000 per worker.

...

...a key provision targeting investment, which the authors identify as the most cost-effective corporate cut. That benefit, which allowed companies to immediately deduct investment spending from their income taxes, would be renewed as part of a bipartisan tax bill that passed the House in January.

It also challenges narratives about the bill on both sides of the aisle. Democrats have claimed the tax cuts only rewarded shareholders and did not help the economy. Republicans have called them a cost-free boon to the middle class. Both appear to have been wrong.

“The evidence that taxes matter for investment really is there,” Gabriel Chodorow-Reich, a Harvard economist and one of the paper’s authors, said in an interview. “And the evidence that corporate tax cuts are expensive also is there. They’re both just features of the data.”

Yeah, that extra $25 a week really made a difference in my life.

[LawBeefaroni]

Feb jobs:

Job creation topped expectations in February, but the unemployment rate moved higher and employment growth ofrom the previous two months wasn’t near as hot as initially reported.

Nonfarm payrolls increased by 275,000 for the month while the jobless rate moved higher to 3.9%, the Labor Department reported Friday.

I know I say this every time but why do we bother? It always "blows away" expectations and but then when revised is much more in line with expectations. Just wait an extra few months.

Economists surveyed by Dow Jones had been looking for payroll growth of 198,000, a step slower from the downwardly revised gain of 229,000 in January. The December gain also was revised down to 290,000 from 333,000.

January reported: 353,000
Expected: 185,000
Revised: 229,000

[Carpet_pissr]

Feb jobs:

Job creation topped expectations in February, but the unemployment rate moved higher and employment growth ofrom the previous two months wasn’t near as hot as initially reported.

Nonfarm payrolls increased by 275,000 for the month while the jobless rate moved higher to 3.9%, the Labor Department reported Friday.

I know I say this every time but why do we bother? It always "blows away" expectations and but then when revised is much more in line with expectations. Just wait an extra few months.

Economists surveyed by Dow Jones had been looking for payroll growth of 198,000, a step slower from the downwardly revised gain of 229,000 in January. The December gain also was revised down to 290,000 from 333,000.

January reported: 353,000
Expected: 185,000
Revised: 229,000

Same for GDP (or at least it used to be like that, haven't looked in a long time).

[Kurth]

Looking at real estate today, I am realizing that we are pretty much trapped in our current home by our 2.5% 30 year mortgage. At the current rates I'm seeing (~7%), if we were to cash out our equity and simply move it over to a new home at the same price point, our monthly payments would be double what they are now. That's nuts!

[Don't get out the tiny violin for me: I also appreciate that we were very lucky to take out a significant mortgage at such an incredibly low interest rate, but it really does lock you in.]

[Zenn7]

Looking at real estate today, I am realizing that we are pretty much trapped in our current home by our 2.5% 30 year mortgage. At the current rates I'm seeing (~7%), if we were to cash out our equity and simply move it over to a new home at the same price point, our monthly payments would be double what they are now. That's nuts!

[Don't get out the tiny violin for me: I also appreciate that we were very lucky to take out a significant mortgage at such an incredibly low interest rate, but it really does lock you in.]

I can strongly relate to this one. Not that I think we can find a better house to "upgrade" to.

Sure, my house is supposedly worth twice what we bought it for, but if I can't afford any amount more payment than what I'm paying (slightly more interest than Kurth, but not much) and I don't want a longer mortgage (really want the house paid off by the time I retire), even if I could move for the same interest rate, I can basically only get a different house worth the same amount as this one. Since I have a great location, how could I benefit from this move?
Part of the problem for me at least is that we've lived here for over 20 years and barely dented the mortgage vs original value of the house. We had 0% down, added closing costs to the mortgage and started with negative equity. refinancing 3 times total now hasn't been super helpful (though the latest refi with cutting the interest in 1/2 and going to a 15 year mortgage, we're making real progress finally).

But even still, it just doesn't seem like you can really get ahead from your first house purchase unless your income changes or you are saving up other money. As your house increases in value, so does anything else that would be an upgrade. Found that a very frustrating feeling as a home owner.