You know, you made some really good points regarding businesses cutting costs at the expense of workers, however I think someone in the comments left a really insightful message about the issue that I think is important to address. He said and I quote, “when is the bloonchipper review video?” I think if we just solve this problem, all of the problems in the economy would be fixed. Thoughts?
The company I work for technically leases the land our offices are on, but I think they have a lot of cost sunk fallacy involved too because they paid to have all of the offices and other facilities constructed here. It's a big corporation so they have the money to do this. We have quite a few offices like this. If we work from home (because we sure af could) they wouldn't have a need for the offices. Thus meaning all the money they invested on the property they don't own is wasted. Even though it would be cheaper for them in the long run, the money invested so far is apparently too much to just let go. This has been told to me by a few of my higher ups. I realize not every company runs this way, but it is a big factor for mine. It all sounds pretty dumb when you think about it.
Its not even a sunk cost fallacy sometimes its peiple justifying their own past decisions to maintain their positions. Like, if you invested in office space you camt kust be like "oops im wrong" you get voted out of ceo or whatever then
One thing missing in this analysis of banks lending money is that in order to function, banks also have to borrow money daily from the upper echelon : the central bank
I actually disagree with “they dont want you back in the office so they can help their landlord”. For big companies, a lot of their investors are invested in office soace and they are pushing anyone they can to fill offices
The more atrioc learns about finance the more bearish he gets but this house of cards has been a house of cards for decades since the 70s and will likely continue for decades.
It is affect many people too. Many cities and small cities rely on taxes to fund their budgets which includes social programs, prosecutions, law enforcement, fire department, emergency services, even maintaining infrastructure like roads and bridges. With lowered income with the growing popularity of WFH many cities are losing income and usually the first programs to get cut are education, child services, and social programs because to the average citizen those are "more acceptable" than cutting emergency services or law enforcement because those take years to manifest their effects (then subsequently complain why education is spiraling downwards years later). Not to mention the investors and clients of big companies who invested into property.
My dad's company rented out two floors when they could fit on one so that everyone could have a cool office with big external windows. It was sick. Company was successful without cutting costs that hurt workers.
you can sell services to your different companies using credit to show both profitability as well as allow you to turn the credit in to actual money to show the taxman. there is no law keeping businesses with the same interests and even owners from buying and selling goods and services from each other. all of this allows you to explode your credit for more physical business interests. all of this makes your companies more creditable by flipping one 3rd of the credit value from one card to another. they always get filled every month and you have 2/3rds liquid in other things funding the actual physical business you're trying to start. it can take some 5 years for a business to really become profitable in the meantime. how do you live and not lose your shirt if it fails.
Thing is, people like Atrioc and Thor are the kind of people we need to see as politicians. They have a fantastic ability to communicate ideas without being preachy and seeming like "elites", they're intelligent and balanced, but funny and approachable. Out politicians right now are the insanely out of touch and both left and right seem to be spiralling. The old systems are starting to fracture under the strain of the unsustainable, short term greed of the 90s and we need younger people with knowledge and approachability to step into those positions and start making a change. I'd vote for Atrioc because regardless of whether he leant left or right, I feel he'd at least be making reasonable, informed decisions.
Does lil-a not know about 0% reserve rates on home mortgages & commercial real estate? They kept loaning money out because they didn’t need to tie up even 1% of the money they were “spending” on houses, more than just not risking anything as mortgages act as government backed blank checks (& the popularity of mortgages being a relatively new construct, post-WW2) this coupled with zoning & the standardization of building codes around the world by banks to support their derivatives with uniform underlying assets (side-note: this especially hurt beechfront & mountain homes which could no longer be built in a way that made sense, along with other extreme environments that should have adapted these building codes the banks gave them but didn’t)…obviously lax mortgages terms inducing demand & overly strict zoning restricting supply. Mortgages only serve to help banks leech & down nothing to help the real buying power people have. If mortgages were outlawed (it would be chaos) but housing prices would fall to a range that was a reasonable multiple of salary. The median house was around 2x the median salary before mortgages…a reasonable amount to save outright without the need for financing to buy a house at all.
waitttt so if they fire sell it cant i "take a loan out" on a house few months later oh no i cant pay it anymore boom they sell it really cheap and then i can just buy it for way cheaper?
You could, but the bankruptcy on the 1st loan would prevent you from getting a 2nd loan to buy it again. And if you have the money to buy it the second time, in cash, you probably have enough to keep paying the 1st loan. Bankruptcy on any loan makes it much harder to do business in the future, especially if your business requires getting loans.
How about when you realize in 7 years you'd only make about 100k at 20k a year so you just build your credit and take out 150k in loans and ride that out for 7 years paying rent for a house at 800 a month and just don't waste money and it drops off your credit. Where'd the debt go? Nobody knows! America. Once your out of money your credits back to 450 and you got a empty profile
Surprised he didn't bring up the massive benefit of returning to the office which is collaborative productivity. If people need to bang heads and get something done, it's way easier to do so in a personal setting
Lots of this is over doomer.. I think low interest rates are terrible overall and it's the reason we are in this scenario but the other points I mostly disagree with.
Sadly not how it works. If you want to buy a 250k house, and only make 50k a year, they arent going to loan you the money no matter what the interest rate is... it all works on % of income
