FedUpUSA

Want To Throw Up? Read This

CookieToss

Straight from the lions that will be happy to eat you comes this tripe, sent to me by a loyal reader.

Home ownership is still at low levels comparatively from the past even though affordability is at an all time high, why? New household formations are at an all time low.

….

More and more young adults are shacking up in their parents home for years. Why is this occurring? Hard to say.

Perhaps it’s the fear of another bubble? Maybe it’s just that much harder to get a home loan? Too many investors with cash offers? Maybe their just lazy strong headed kids with spineless parents?

What?

Jesus you’re stupid if you actually believe that crap.

Listen to this advice from the same “article”:

Let’s not assume everyone we know, knows what’s going on out there. Bottom line, they could use your help.

And when we say “talk” to them, we don’t mean send them an e-newsletter with a turkey recipe on it. We mean actually physically speaking to them and having an honest conversation about the awesome opportunities that are available in housing right now.

Can I have a lobotomy with my real estate pumping please?

Christ on a tree, will you folks in the so-called Real Estate “business” wake up?

Young people are incapable of buying a house because they’re too damned expensive and with interest rates at all time lows there is only one way for them to go — and when they do the imputed price of the house will fall dramatically.

Further, and probably more importantly, young people are told to go to college any way they can, and more and more of them are doing so while taking on $50,000, $100,000 or more in debt.

That’s a house payment all on its own, and incidentally, very few people can afford two house payments.  Since they already have one, they can’t also afford a house.

Ultimate Facepalm

How did this all happen?  Simple, and the Real Estate lending industry (and housing industry in general) was a mighty contributor to it.  By pushing the buying of things on credit and the expansion of credit generally at rates that grossly exceed actual economic expansion in the economy the price of things goes up.  When this is directed to “assets” you have a problem.

Then you support the destruction of quality blue-collar jobs to go along with the destruction of blue-collar-priced homes and what do you expect to happen?

Due to technology the price of things over time — including houses — should go down.  They go up because you are continually pulling forward demand with ever-larger amounts of credit that exceed the growth in economic output.

But this game is not an infinite process and cannot go on forever.  The wall was hit in 2008 and has not materially come off at all.  Indeed, if you look at the Fed Z1 the only place where credit has materially contracted is in “financial products” — that is, loans between financial institutions — and all of that and more was absorbed by new FEDERAL borrowing to hand out cash to Obama’s favorite friends, never mind the outright fraud of “budget contraction” that is in fact still an expansion that Rethuglicans run year after year and you lap it up like Pavlov’s dog.

In other words systemic leverage has hardly moved since 2008 and all of that has been backloaded on those least able to pay — including young people.  Then you add onto that skyrocketing property taxes (nearly a clean double in the last 10 years in some areas of the Midwest!) and a labor:employment ratio that hasn’t moved a millimeter since 2009 and you have a toxic brew under which far fewer people can buy a house.

The comments to the article are largely recognizing the problem, which is good.

That this crap got posted in the first place tells you everything you need to know about the duplicity in the so-called “Real Estate” business.

The Market Ticker

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