California Dreamin' (Homeless Crisis) - Printable Version +- Scivillage.com Casual Discussion Science Forum (https://www.scivillage.com) +-- Forum: Culture (https://www.scivillage.com/forum-49.html) +--- Forum: General Discussion (https://www.scivillage.com/forum-48.html) +--- Thread: California Dreamin' (Homeless Crisis) (/thread-4992.html) |
California Dreamin' (Homeless Crisis) - Secular Sanity - Mar 10, 2018 "On a winter's day (on a winter's day) I'd be safe and warm (I'd be safe and warm) If I was in L.A. (if I was in L.A.)" Continued from… California or Third World Country? It's not just a mental health issue. Crazy California? Crazy prices, perhaps. It intensified right after our little nationwide housing price conundrum. It's been snowballing ever since and the problem isn’t going to fix itself. California’s High Housing Costs: Causes and Consequences RE: California Dreamin' (Homeless Crisis) - Syne - Mar 10, 2018 Local government has a big effect on housing prices, by way of property taxes and construction permit fees and regulations. RE: California Dreamin' (Homeless Crisis) - confused2 - Mar 11, 2018 (Mar 10, 2018 04:16 PM)Secular Sanity Wrote: It's not just a mental health issue. Crazy California? Crazy prices, perhaps. Thanks for that link SS. Sal gives a worryingly simple account of what happens when the lunatics take over the asylum (aka the free market). In the UK the majority of young people are suffering from a syndrome known as not-having-bought-a-house-in-the-70s... all they can do is wait for my generation to die so they can inherit - this applies to those in rented accommodation as well as those living in tents by the side of the road. RE: California Dreamin' (Homeless Crisis) - Syne - Mar 11, 2018 (Mar 11, 2018 12:06 AM)confused2 Wrote: Sal gives a worryingly simple account of what happens when the lunatics take over the asylum (aka the free market). It's not a problem of the free market. It's a problem of government tax and regulation stifling the free market. RE: California Dreamin' (Homeless Crisis) - Secular Sanity - Mar 11, 2018 (Mar 11, 2018 02:21 AM)Syne Wrote:(Mar 11, 2018 12:06 AM)confused2 Wrote: Sal gives a worryingly simple account of what happens when the lunatics take over the asylum (aka the free market). I don't think that he watched the videos. RE: California Dreamin' (Homeless Crisis) - Syne - Mar 11, 2018 Again, not watching dozens of videos, especially if you don't have the wherewithal to make your own arguments. Demand increase faster than supply. You know what one demand driver is? Easier loans to people who don't really qualify. And from your own link: Why Is Housing Expensive in California? Considering coastal areas often regulate how dense housing can be, to maintain property values, like I said, government tax and regulation artificially stifles the market. RE: California Dreamin' (Homeless Crisis) - confused2 - Mar 11, 2018 Syne Wrote:Again, not watching dozens of videos, especially if you don't have the wherewithal to make your own arguments.I'll bite on that. Until fairly recently one of the requirements for getting a loan from a bank was that you could show some evidence that you had the ability to pay the interest on the loan and ultimately the principle. However, if house prices are always rising then a bank could lend money with the house as security - if the borrower defaulted the bank could repossess the house and sell it and still make a profit. So banks can lend to people who have no hope whatsoever of paying (even) interest in the long term as long as the price of houses continues to rise. In the short term the price of houses rises because anyone can borrow money to buy a house regardless of income which is fine all round because either the buyer (or the bank) can make a profit as long as the price of houses continues to rise. If you can see a problem with this situation (unrelated to tax and regulation) then you are doing better than the British Banking system - when the crunch came and house prices fell the British Banks (and probably those in many other countries) were 'in' for trillions of dollars. The UK taxpayer bailed out the UK banks and the UK banking industry gave itself huge bonuses for getting a loan which it had neither the ability nor intention of repaying. In banking circles the rather public celebration (bonuses) will probably count as the only mistake. RE: California Dreamin' (Homeless Crisis) - Syne - Mar 11, 2018 (Mar 11, 2018 04:34 AM)confused2 Wrote:Syne Wrote:Again, not watching dozens of videos, especially if you don't have the wherewithal to make your own arguments.I'll bite on that. Until fairly recently one of the requirements for getting a loan from a bank was that you could show some evidence that you had the ability to pay the interest on the loan and ultimately the principle. However, if house prices are always rising then a bank could lend money with the house as security - if the borrower defaulted the bank could repossess the house and sell it and still make a profit. So banks can lend to people who have no hope whatsoever of paying (even) interest in the long term as long as the price of houses continues to rise. In the short term the price of houses rises because anyone can borrow money to buy a house regardless of income That's pretty much how it went down in the US housing bubble. Except the lower qualifications for loan approvals was actually mandated by government regulation. Banks here weren't doing that until the government pressured them. And since the government was to blame, the US taxpayer bailed them out too. RE: California Dreamin' (Homeless Crisis) - confused2 - Mar 11, 2018 Syne Wrote:That's pretty much how it went down in the US housing bubble. Except the lower qualifications for loan approvals was actually mandated by government regulation. Banks here weren't doing that until the government pressured them. And since the government was to blame, the US taxpayer bailed them out too. From https://en.wikipedia.org/wiki/Fannie_Mae#The_mortgage_crisis_from_late_2007:- "Then in 2003–2004, the subprime mortgage crisis began.[35] The market shifted away from regulated GSEs and radically toward Mortgage Backed Securities (MBS) issued by unregulated private-label securitization conduits, typically operated by investment banks." Clearly there are two sides to every story and we may well (as intended) never know the truth. RE: California Dreamin' (Homeless Crisis) - Secular Sanity - Mar 11, 2018 (Mar 11, 2018 02:57 AM)Syne Wrote: Again, not watching dozens of videos, especially if you don't have the wherewithal to make your own arguments. There’s no shortcuts to understanding complicated situations, sweetie. If you want to pop off and sound like a big shot, watch the videos and read the links. "Martin Lowy argued that America’s housing bubble couldn’t have inflated to dangerous proportions without massive inflows from Europe. The crisis was built in just three years: 2004 through 2006. If no new financing sources had been added to the housing market after 2003, nothing extraordinary would have happened even if house prices had declined. What made those three years extraordinary was the influx of foreign money into securitized mortgage-based products. That inflow enabled mortgage money to be advanced to people who couldn’t repay it. Foreign money knows little about the domestic market and therefore relies on local banks, governments, or rating agencies. Investment banks seized on that weakness of the foreign money to use weaknesses in the system to promote badly underwritten mortgage products and pass them off as money-good." The Real Cause of Americas Housing Bubble was Foreign Money But shortly after, Chinese investors started pouring in and the prices continued to rise. There was this little program that was created in 1990. We offered up citizenship through this EB-5 Immigrant Investor Program, providing a method for eligible Immigrant Investors to become lawful permanent residents, but there was some shady shit here, as well. There were a few loopholes in it and the amount of jobs that it was supposed to create never actually took place. Chinese customers quickly became the silver lining in, not only America’s real estate market, but also, Canada’s, Australia’s, etc. As the prices climb along with rent and property taxes, California residents are being forced out. China’s Millionaire Migration Chinese pouring over $110 billion into US real estate There's a lot more to the story but so little time. Maybe next time, when Syne catches up. |