Comment by rictic
5 days ago
Inflation adjusted incomes are up in the US across the board. The affordability problem is largely the price of housing because it's illegal to build.
5 days ago
Inflation adjusted incomes are up in the US across the board. The affordability problem is largely the price of housing because it's illegal to build.
Incomes are up, but the expenses are up as well, especially with the upcoming changes in healthcare for people on the ACA.
Also any comparison of wage growth vs corporate profit growth over the last 30 years shows that wages have not kept pace with the increase in productivity.
So incomes are only just barely keeping up, when they should be booming.
How can inflation adjusted income be up and there still be an affordability crisis?
Housing is not part of the inflation calculation. There IS a housing inflation crisis.
Household income is more than just wages. Household income can go up while wages remain stagnant or shrinking because other pieces of the pie are increasing (e.g. work benefits, investments, money from the government). https://fredblog.stlouisfed.org/2016/09/sources-of-household...
The price of housing can rise even faster than incomes.
Housing is only a part of the basket used to measure inflation. Housing's price rose faster than the weighted basket average, some other goods and services rose slower or even fell.
Accommodation costs are the first part of any sensible measure of inflation. If you're not factoring in housing then you're fudging the figures.
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Housing, schooling, healthcare, daycare, food.
Samsung TV purchasing power has skyrocketed, though, so there's that.
Inflation also corrodes your savings and investments.
Yet more and more people are struggling to afford even basic necessities and one can only dream of the luxury of the 50's when a single working class person was able to pay and cover for housing, car, family and even have enough for leisure. Where has all the economic surplus gone? Right...to the bourgeois, the capital owning class that exceedingly extract more and more of the wealth generated by the society.
because the developing world is producing a lot of things except the housing.
They also don't produce haircuts.