View Full Version : Shipping container Inflation! (700%)
JohnO
09-25-2021, 12:27 PM
Since China makes darn near everything sold in the U.S., it has to get here.
The cost to ship containers overseas has soared in recent months. Getting a 40-foot container from Shanghai to New York cost about $2,000 a year and a half ago, just before the Covid pandemic. Now, it runs some $16,000, according to Bank of America.
Yowza! A 700% increase. Buckle up the ride is getting rough.
Costco, Nike and FedEx are warning there’s more inflation set to hit consumers as holidays approach
https://www.cnbc.com/2021/09/24/costco-nike-and-fedex-are-warning-theres-more-inflation-set-to-hit-consumers-as-holidays-approach.html
Navin Johnson
09-25-2021, 12:38 PM
Since China makes darn near everything sold in the U.S., it has to get here.
Yowza! A 700% increase. Buckle up the ride is getting rough.
Costco, Nike and FedEx are warning there’s more inflation set to hit consumers as holidays approach
https://www.cnbc.com/2021/09/24/costco-nike-and-fedex-are-warning-theres-more-inflation-set-to-hit-consumers-as-holidays-approach.html
Those numbers are NOT west coast prices. Before the "vid" 4-5 k to Sea-town (now called chop) from Taiwan. Last one we got a month ago was 12k. now around 20-21K quoted.
Lots of empty containers sitting in ports that need to go back but cost the same even if empty.
No one to unload and deliver full containers sitting in ports and on boats in harbors.
Unemployment money is making it hard to get drivers.
Unemployment money is making it hard to get drivers.
There is no data to support that narrative. It may be hard to get drivers, but unemployment money isn't the cause.
https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm
We're 1.7% off where we were when covid hit, at 5.3% vs 14.8% at peak covid.
Even in Texas the state is within 0.7% of the national average: https://gov.texas.gov/es/travel-texas/post/texas-unemployment-rate-falls-to-5.9-percent-in-august-state-adds-39300-jobs-over-the-month
I don't know why "you fired/furloughed/etc them, so they went somewhere else and stayed there" is so hard for people to accept. Just because people don't want to work the jobs you come into contact with doesn't mean they aren't working.
Navin Johnson
09-25-2021, 01:53 PM
There is no data to support that narrative. It may be hard to get drivers, but unemployment money isn't the cause.
https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm
We're 1.7% off where we were when covid hit, at 5.3% vs 14.8% at peak covid.
Even in Texas the state is within 0.7% of the national average: https://gov.texas.gov/es/travel-texas/post/texas-unemployment-rate-falls-to-5.9-percent-in-august-state-adds-39300-jobs-over-the-month
I don't know why "you fired/furloughed/etc them, so they went somewhere else and stayed there" is so hard for people to accept. Just because people don't want to work the jobs you come into contact with doesn't mean they aren't working.
I am not an economist and am going on what the local shipping yards have told me.
That being said I'm very glad to hear the above as I am concerned that Uncle Joe's extra unemployment money in an attempt to drive up wages was going to cause an even greater inflation problem than we have now.
littlejerry
09-25-2021, 01:54 PM
There is no data to support that narrative. It may be hard to get drivers, but unemployment money isn't the cause.
https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm
We're 1.7% off where we were when covid hit, at 5.3% vs 14.8% at peak covid.
Even in Texas the state is within 0.7% of the national average: https://gov.texas.gov/es/travel-texas/post/texas-unemployment-rate-falls-to-5.9-percent-in-august-state-adds-39300-jobs-over-the-month
I don't know why "you fired/furloughed/etc them, so they went somewhere else and stayed there" is so hard for people to accept. Just because people don't want to work the jobs you come into contact with doesn't mean they aren't working.
The unemployment rate is a pretty meaningless statistic for evaluating whether people are back to work as it only accounts for people actively looking for employment. Look at the employment:population ratio. We're currently at or below the great recession.
That being said I'm very glad to hear the above as I am concerned that Uncle Joe's extra unemployment money in an attempt to drive up wages was going to cause an even greater inflation problem than we have now.
Right. The Federal $300 thing ran out a few weeks ago and several states ended it before that.
The unemployment rate is a pretty meaningless statistic for evaluating whether people are back to work as it only accounts for people actively looking for employment. Look at the employment:population ratio. We're currently at or below the great recession.
People aren't crawling into ditches and giving up. The unemployment money dried up and everyone went back to work, albeit in a lot of cases in completely different industries.
edit: and regardless of what it measures it's comparing the same thing over the last 20 years. There is no shadow workforce that's decided they'd rather be homeless rather than do the same job they were doing before the pandemic. (The same jobs, btw, that are throwing money at anyone who will show up.)
littlejerry
09-25-2021, 02:53 PM
People aren't crawling into ditches and giving up. The unemployment money dried up and everyone went back to work, albeit in a lot of cases in completely different industries.
edit: and regardless of what it measures it's comparing the same thing over the last 20 years. There is no shadow workforce that's decided they'd rather be homeless rather than do the same job they were doing before the pandemic. (The same jobs, btw, that are throwing money at anyone who will show up.)
Per the source you cited, the data doesn't support your hypothesis. A large portion of the population has decided not to go back to work. "Why" is up for debate, not "If"
Crow Hunter
09-25-2021, 05:42 PM
The unemployment rate is a pretty meaningless statistic for evaluating whether people are back to work as it only accounts for people actively looking for employment. Look at the employment:population ratio. We're currently at or below the great recession.
WOW.
That explains something that has been bothering me for a while. I could not get my brain wrapped around how just barely a decade ago everyone was worried about being laid off and trying desperately to find a job, any job. Then boom, suddenly no one can find anyone to work but the population hasn't suddenly dropped nor have any local businesses had massive expansions. I am not exaggerating, my wife is in charge of HR for the largest employer in this county that has great benefits and pay, even a freaking pension, and they CANNOT find people to work.
Now the question is, why is a similar percentage of the population in the U.S. choosing to not be employed as there were people who couldn't get a job during the Great Recession when people were afraid of "losing their homes" and "having their children go hungry".
Why aren't those same people now not worried? What about all those poor "I graduated and there were no jobs" people who can't pay their student loans back because they couldn't find jobs?
I wonder what is different?
littlejerry
09-25-2021, 07:05 PM
WOW.
That explains something that has been bothering me for a while. I could not get my brain wrapped around how just barely a decade ago everyone was worried about being laid off and trying desperately to find a job, any job. Then boom, suddenly no one can find anyone to work but the population hasn't suddenly dropped nor have any local businesses had massive expansions. I am not exaggerating, my wife is in charge of HR for the largest employer in this county that has great benefits and pay, even a freaking pension, and they CANNOT find people to work.
Now the question is, why is a similar percentage of the population in the U.S. choosing to not be employed as there were people who couldn't get a job during the Great Recession when people were afraid of "losing their homes" and "having their children go hungry".
Why aren't those same people now not worried? What about all those poor "I graduated and there were no jobs" people who can't pay their student loans back because they couldn't find jobs?
I wonder what is different?
https://unemploymentdata.com/unemployment-rate/real-unemployment-rate/
There are 6 types of unemployment tracked by the BLS. U3 is what is typically reported my the media outlets. It's not a great barometer for the job market. Often times the U3 will drop because people become long term unemployed or are not even in the labor force. This happened a lot from 2010-2016 and the media would always sing Obama's praise for lowering the unemployment even though they were simply shifting numbers to long-term unemployed or not in labor force.
Conversely the U3 rate can rise when the market is hot and people re-enter the labor force after having been unemployed for a long period. This was happening in 2016-18.
Today we have the same chearleaders saying "Look the U3 is low!" while ignoring the massive numbers of people who are no longer in the labor force.
The fewer producers we have in the economy the worse off we are.
Buddies Son just got a delivery job. His first day on the job he got in a wreck. Then later the same day he ran the truck off the road and it took a wrecker to get the truck back on the road. He decided this wasnt for him and when he got back to the terminal he told them he couldnt do this job and he quit. The next day they called him to offer $300 bonus if he would come back. He said no. The second day they called and offered the bonus plus .75cents per hour. This continued over 5 days with better offers each day.
Recentl a Fed Ex guy made a delivery in a Penske truck across the street from me. I was out front and talked with him a bit. He said he was a regional manager and they couldnt hire enough people to do the work.
I cant help wondering if people are still flush from the increase of pay from covid unemployment and dont feel a pressing need to go back to work yet.
beenalongtime
09-25-2021, 07:54 PM
WOW.
Now the question is, why is a similar percentage of the population in the U.S. choosing to not be employed as there were people who couldn't get a job during the Great Recession when people were afraid of "losing their homes" and "having their children go hungry".
Why aren't those same people now not worried? What about all those poor "I graduated and there were no jobs" people who can't pay their student loans back because they couldn't find jobs?
I wonder what is different?
I have seen a LOT of reasons why. In several cases, people didn't stay six feet apart (new life). Several of those, realized putting the children in daycare, meant they were working for their daycare operators. In a few cases, the spouses were able to get better paying job and they saved, on daycare.
There are those that used the handouts to better their situations, paying down rent, moving closer to family, etc etc. That improved their situations.
There are a lot of older people, who either retired, or haven't gone back to work yet.
Job changes, which include working from home, starting new businesses (lawn mowing, hauling off all that stuff that people needed to get rid of etc).
Some died, or have serious health issues (three people I know need transplants). Several have or had covid.
Some moved back home (as colleges closed, back at parents instead of workforce).
Etc.
Without regard to whether it is good or bad, lately our safety net programs have provided enough that many people are able to decide whether they want to work or not. Also, whether working from home or not working since Covid, many have gotten out of the habit of going to work.
A future challenge is we need a sufficient ratio of those working to support the costs of those that do not work. When workers decline and benefits to non workers grow, that is problematic.
Welder
09-25-2021, 11:12 PM
It's a great time to be entering the labor force. Probably a historically great time to be starting a small business. I've raised my labor rates by $25/hour this past year and I still can't get out from under the workload. I'm not sure when I last had a full 24 hours off, let alone a full weekend off. The hourly rate for today's work, since it was a weekend, was on par with what my divorce lawyer charged me. Tomorrow's will be the same. Oh wait, tomorrow is today now. Gotta hit the sack!
Buddies Son just got a delivery job. His first day on the job he got in a wreck. Then later the same day he ran the truck off the road and it took a wrecker to get the truck back on the road. He decided this wasnt for him and when he got back to the terminal he told them he couldnt do this job and he quit. The next day they called him to offer $300 bonus if he would come back. He said no. The second day they called and offered the bonus plus .75cents per hour. This continued over 5 days with better offers each day.
Recentl a Fed Ex guy made a delivery in a Penske truck across the street from me. I was out front and talked with him a bit. He said he was a regional manager and they couldnt hire enough people to do the work.
I cant help wondering if people are still flush from the increase of pay from covid unemployment and dont feel a pressing need to go back to work yet.
https://www.foxbusiness.com/lifestyle/fedex-rerouting-packages-daily-labor-shortage
FedEx rerouting more than 600K packages a day because of labor shortages
FedEx anticipates a 'similar level of headwinds' in second quarter
https://www.freightwaves.com/news/record-shattered-61-container-ships-stuck-waiting-off-california
Record shattered: 73 container ships stuck waiting off California
UPDATED: Latest anchorage stats show port congestion crisis at new peak
The number of container ships at anchor or drifting in San Pedro Bay off the ports of Los Angeles and Long Beach has blown through all previous records.
The latest peak: There were an all-time-high 73 container ships in the queue in San Pedro Bay on Sunday, according to the Marine Exchange of Southern California (the tally inched back to 69 on Tuesday). Of the ships offshore Sunday, 36 were forced to drift because anchorages were full.
Theoretically, the numbers — already surreally high — could go even higher than this. While designated anchorages are limited, the space for ships to safely drift offshore is not.
“There’s lots of ocean for drifting — there’s no limit,” Capt. Kip Loutit, executive director of the Marine Exchange of Southern California, told American Shipper.
“Our usual VTS [Vessel Traffic Service] area is a 25-mile radius from Point Fermin by the entrance to Los Angeles, which gives a 50-mile diameter to drift ships. We could easily expand to a 40-mile radius, because we track them within that radius for air-quality reasons. That would give us an 80-mile diameter to drift ships,” said Loutit.
Limits on land
The Southern California gateway is acting like the narrow tube on a funnel: Ocean volumes pour in from Asia and can only flow out at a certain velocity due to terminal limitations as well as limitations of warehouses, trucking and rail beyond the terminal. When the flow into the top of the funnel is too great, as it is now, it creates an overflow in the form of ships at anchor or adrift. This offshore ship queue is equivalent to a massive floating warehouse for containerized imports whose size is only limited by liner shipping capacity and U.S. consumer demand.
How constrained is the flow? Port of Los Angeles Executive Director Gene Seroka said during a press conference on Wednesday that container dwell time in the terminal “has reached its peak since the surge began” and is now six days, worsening from 5.3 days last month. On-dock rail dwell time is 11.7 days, not far below the peak of 13.4. Street dwell time (outside the terminal) “is 8.5 days, nearing the all-time high” of 8.8 days, said Seroka. It has worsened from 8.3 days a month ago.
Marine Exchange data reveals the constraints of the Los Angeles/Long Beach port complex. Since congestion began, the total number of container ships either at anchor or at berth has risen and fallen — it was an all-time-high 100 on Sunday, more than five times pre-COVID levels. But one stat has remained remarkably consistent: The number of container ships at Los Angeles/Long Beach berths has remained in a tight band of around 27-31 per day — that is what the land side can handle, the tube of the metaphorical funnel. Throughout 2021, all ship arrivals over that threshold have overflowed into the anchorages and drift areas.
More ships deployed in trans-Pacific
Meanwhile, at the wider open end at the top of the funnel — the drift area radius outside the port — a much higher number of ships is flooding into Southern California than ever before.
Seroka noted that of the 84 ships his port handled in August, 11 were “extra loaders” — ships that are not part of a scheduled service. “And in addition to the extra loaders we’ve seen from incumbent carriers, there are no less than 10 newcomers [new services] to the trade,” he added.
According to Alphaliner, deployed trans-Pacific capacity is up 30% year on year.
Asked by American Shipper whether ports or terminals could proactively stem inbound flows to provide more breathing room, Seroka replied: “Slowing down these ships is something we thought about in the early days of the surge, to try to give us a little bit more time in between to get ready for the next ships. But if you start looking at slowing down these ships, it’s going to back up the vessel supply chain even further and make schedules an even deeper concern for liner companies.” In other words, no.
Imports down year on year
The higher the number of ships waiting offshore, the bigger the queue and the longer it takes for a vessel to get a berth. On Tuesday, the average wait time to reach a berth in Los Angeles (30-day rolling average) rose to an all-time high of nine days.
That, in turn, delays imports. Back in August 2020, when import demand surged post-lockdowns, there were almost no ships at anchor off Southern California. This August, there was an average of 36 ships at anchor per day, according to Marine Exchange data. The port of Los Angeles handled 485,672 twenty-foot equivalent units of imports in August — down 5.9% year on year.
Without regard to whether it is good or bad, lately our safety net programs have provided enough that many people are able to decide whether they want to work or not.
That was true while the $300/wk federal benefit was active. An extra $1200/mo on top of regular UI was a godsend to a lot of people who wouldn't otherwise be making that sort of money. That federal benefit expired weeks ago. It appears that the gravy train has ended and the unemployment numbers-- including U6-- are basically where they were in 2015. Not great, not terrible. Not particularly noteworthy in any real way.
I have yet to see any actual data supporting the notion that a chunk of the workforce has simply decided they'd rather be homeless once their UI benefits were exhausted. There's no explanation at all for where this shadow workforce has gone once the rent/grocery money ran out.
Almost 700k dead + at most 1-2 million on covid-related disability? There have been other threads where BLS data is showing a significant number of people have switched industries entirely. Without seeing the actual before and after numbers I don't know that I'd buy that's enough to have impacted the labor market to this degree. But at present it seems more plausible than people just saying "screw it". Because if that was an option they'd have done it a long time ago.
I'm open to data that supports your narrative, but I haven't seen it yet. It seems more likely that there are jobs that have an outsized effect on the downstream economy and that people would rather not do (like loading and unloading shipping containers) in lieu of some other job that either pays better or has a better working environment.
That was true while the $300/wk federal benefit was active. An extra $1200/mo on top of regular UI was a godsend to a lot of people who wouldn't otherwise be making that sort of money. That federal benefit expired weeks ago. It appears that the gravy train has ended and the unemployment numbers-- including U6-- are basically where they were in 2015. Not great, not terrible. Not particularly noteworthy in any real way.
I have yet to see any actual data supporting the notion that a chunk of the workforce has simply decided they'd rather be homeless once their UI benefits were exhausted. There's no explanation at all for where this shadow workforce has gone once the rent/grocery money ran out.
Almost 700k dead + at most 1-2 million on covid-related disability? There have been other threads where BLS data is showing a significant number of people have switched industries entirely. Without seeing the actual before and after numbers I don't know that I'd buy that's enough to have impacted the labor market to this degree. But at present it seems more plausible than people just saying "screw it". Because if that was an option they'd have done it a long time ago.
I'm open to data that supports your narrative, but I haven't seen it yet. It seems more likely that there are jobs that have an outsized effect on the downstream economy and that people would rather not do (like loading and unloading shipping containers) in lieu of some other job that either pays better or has a better working environment.
77627
Borderland
09-26-2021, 08:18 AM
Costco is predicting shortages and limits.
The Costco CFO said the company is selling out of merchandise within two weeks after it is received and that the company has been ordering “more and earlier,” to combat lengthy shipping times.
Galanti announced Costco is imposing consumer limitations on purchases of household items such as toilet paper, paper towels, and Kirkland brand bottled water amid supply chain complications.
Transportation of goods both overland and ocean freight is becoming an impossible situation for retailers.
No wonder containers are becoming astronomically expensive.
https://www.breitbart.com/pre-viral/2021/09/25/upwards-of-60-container-ships-waited-to-port-in-california-this-week-posing-looming-ramifications-for-supply-chains/
https://www.wsj.com/articles/cargo-delays-are-getting-worse-but-california-ports-still-rest-on-weekends-11632648602
Borderland
09-26-2021, 08:54 AM
That was true while the $300/wk federal benefit was active. An extra $1200/mo on top of regular UI was a godsend to a lot of people who wouldn't otherwise be making that sort of money. That federal benefit expired weeks ago. It appears that the gravy train has ended and the unemployment numbers-- including U6-- are basically where they were in 2015. Not great, not terrible. Not particularly noteworthy in any real way.
I have yet to see any actual data supporting the notion that a chunk of the workforce has simply decided they'd rather be homeless once their UI benefits were exhausted. There's no explanation at all for where this shadow workforce has gone once the rent/grocery money ran out.
Almost 700k dead + at most 1-2 million on covid-related disability? There have been other threads where BLS data is showing a significant number of people have switched industries entirely. Without seeing the actual before and after numbers I don't know that I'd buy that's enough to have impacted the labor market to this degree. But at present it seems more plausible than people just saying "screw it". Because if that was an option they'd have done it a long time ago.
I'm open to data that supports your narrative, but I haven't seen it yet. It seems more likely that there are jobs that have an outsized effect on the downstream economy and that people would rather not do (like loading and unloading shipping containers) in lieu of some other job that either pays better or has a better working environment.
With things like rent moratoriums and educational loan forgiveness becoming common I believe many people who did those low skill undesirable jobs have left the work force for college. Covid is here to stay and with that many of the wealthier blue states will be subsidizing rent for a very long time. This state has a yuge housing crisis which existed before covid.
https://www.forbes.com/sites/zackfriedman/2021/09/18/biden-cancelled-15-billion-of-student-debt-for-borrowers-but-you-can-still-apply-now/?sh=11a98bfb6b91
https://www.king5.com/article/news/local/governor-jay-inslee-extends-washington-state-eviction-moratorium/281-013f0ad3-14cf-4a82-92bd-4cae3beb1d9b
blues
09-26-2021, 09:07 AM
Well, now I guess I understand why they're letting so many cross the border without proper documentation...someone has to be willing to work.
77627
Interesting. So 1.6% of the over 16 crowd works out to what, ~4 million people?
Even if everything went back to normal today the total dead and permanently disabled from covid would account for a chunk of that. Once you factor in early retirements, the possibly prolonged "dual income families become single income families while one parent turns their unemployment into full time child care", etc I don't think even conscripting all the people who just "don't want to work" is going to get the labor force participation numbers back to where they were pre-covid.
I doubt those numbers are going to look "normal" for quite some time.
With things like rent moratoriums and educational loan forgiveness becoming common I believe many people who did those low skill undesirable jobs have left the work force for college. Covid is here to stay and with that many of the wealthier blue states will be subsidizing rent for a very long time. This state has a yuge housing crisis which existed before covid.
https://www.forbes.com/sites/zackfriedman/2021/09/18/biden-cancelled-15-billion-of-student-debt-for-borrowers-but-you-can-still-apply-now/?sh=11a98bfb6b91
https://www.king5.com/article/news/local/governor-jay-inslee-extends-washington-state-eviction-moratorium/281-013f0ad3-14cf-4a82-92bd-4cae3beb1d9b
I think the moratorium ends in TX on Oct 1. I guess we'll find out what the impact on labor force participation is soon.
Borderland
09-26-2021, 10:22 AM
Well, now I guess I understand why they're letting so many cross the border without proper documentation...someone has to be willing to work.
I think the present administration is actually facilitating that now by turning thousands of crossers loose into the wild without processing or returning them to Mexico. It's apparent to me that is more desirable for this adm then detaining them in holding facilities for months. Of course they will never appear for a hearing because they may be deported.
It's the new shadow work force. As the wheels start to fall of in this economy because nobody is willing to work, the requirement for being in the country legally will suddenly become unimportant. I see another amnesty rapidly approaching.
peterb
09-26-2021, 10:37 AM
Well, now I guess I understand why they're letting so many cross the border without proper documentation...someone has to be willing to work.
Which is why it boggles me that we haven’t improved the system for LEGAL immigration for work — both temporary and permanent.
It’s hardly a secret that many domestic industries rely on migrant and immigrant labor, both legal and illegal. We’d be a lot better off if we were honest about it instead of complaining about it while pocketing the profits.
Which is why it boggles me that we haven’t improved the system for LEGAL immigration for work — both temporary and permanent.
It’s hardly a secret that many domestic industries rely on migrant and immigrant labor, both legal and illegal. We’d be a lot better off if we were honest about it instead of complaining about it while pocketing the profits.
The farming industry does it. I know a guy who grows a whole lot of tobacco under contract to a major tobacco company. He has permanent housing on his farms for workers. He gets the same workers every year through some govt program.
Well, now I guess I understand why they're letting so many cross the border without proper documentation...someone has to be willing to work.
What good is a worker who doesnt speak the language is possibly illiterate has minimal math skills if any and doesnt understand basic concepts of personal hygeine. A buddy working in a Japanese company that has hired a lot of migrants from Africa. They had to put a security guard in the bathroom because these idiots were shitting on the floor and washing their junk in the sink on breaks. And their families were hanging out in the breakroom and using the bathrooms for washing. One got caught punching in ten people at a time who werent on the premises at all. They also had to hire a Swahili and French translator because they dont speak English. Apparently they are also terrible workers.
blues
09-26-2021, 11:16 AM
I'm not going to venture into the political realm in reply to the responses to my earlier post, but I will say that compared to many of the indigenous locals hereabouts, I'd much prefer to have a Mexican, Haitian or any of various Central and South American workers performing work on my behalf.
I'm sure there was a time when others thought my forebearers just crept out of a hole somewhere and didn't meet the high standards of the local gentry.
I'm not happy about the border situation by any means, and believe we need to control it, (without regard to politics or party), but I don't equate that with any inability on the part of immigrants.
Somebody has to be willing to work. And people can be trained to do it.
ETA:
IMHO, if an individual is able bodied and can work, but refuses to...the money spigot must be turned off. We don't need to reward or promote the "slacker" lifestyle.
Personally, I think alot of the shortage has to do with income. It's often hard for those on this board to remember what the US median household income is, and how many live below it. We're talking about $62K as a household. Realistically, the people causing this shortage are in the arena and are struggling to get ahead.
My state moved to increase minimum wage until it eventually settles at $15 in a few years. I voted against it, but it didn't help. I think wages are one way to improve American's lives but moral leadership is better. When I go to work (I'm out with covid at the moment) I'm making X amount over minimum. Soon, that will be less. My employer is expecting more work from me because of labor issues and people out sick. They want me to work even harder - while doing nothing to compensate. Surrounding employers (municipality) pay better and offer opportunity to advance. Our municipality like many private employers isn't doing much to incentivize work. People need to work hard to earn money. Granted. But for a long time the ball has belonged to the employer and they've made the demands. I think that they maybe don't grasp that treating your workers like a resource and not people is coming to roost. With big chains offering more and more for less skilled labor it makes it easy to walk away from bad employers. A lot of this is in my bias opinion based on companies who have selected dickheads without any personal skills to serve in leadership roles. You can't offer little time off, laughable over priced insurance, poor attitudes to workers, and demand tons of work. There needs to be more on the scale for the employee to stay instead of jumping to a fortune 500 who will give them what they're looking for. It's just that simple. The jobs taking the hits right now are the ones that either A) cant afford to keep up or B) need to clear house with their leadership.
The result is skilled labor looking to take easier jobs that will make them the same, or in many cases better pay.
Borderland
09-26-2021, 12:36 PM
What good is a worker who doesnt speak the language is possibly illiterate has minimal math skills if any and doesnt understand basic concepts of personal hygeine. A buddy working in a Japanese company that has hired a lot of migrants from Africa. They had to put a security guard in the bathroom because these idiots were shitting on the floor and washing their junk in the sink on breaks. And their families were hanging out in the breakroom and using the bathrooms for washing. One got caught punching in ten people at a time who werent on the premises at all. They also had to hire a Swahili and French translator because they dont speak English. Apparently they are also terrible workers.
Farmers here in this state use a lot of legal and illegal workers in the fields. Some of them speak English but they usually have lead workers who are bilingual anyway. I'm not sure what their math skills are or if they read and write. Doesn't matter to an orchard owner who's trying to harvest his apples.
If you want literate workers with good math skills who speak English, that would be your average 18 year old who just graduated HS. They don't want those jobs. Most of them have never had a paying job a day in their lives.
Being able to speak English isn't that important. I was in a McDonalds about a year ago and everyone behind the counter was speaking Spanish. The woman who took my order was having difficulty understanding that I only wanted one breakfast burrito. She kept asking me if I wanted two and I kept telling her only one. I could have told her in Spanish but I wasn't in a real good mood that morning. She gave me two, I paid, thanked her in Spanish and left. She probably thought I was a real jerk.
But I'm veering off into politics so hasta la vista.
My employer is expecting more work from me because of labor issues and people out sick. They want me to work even harder - while doing nothing to compensate. Surrounding employers (municipality) pay better and offer opportunity to advance. Our municipality like many private employers isn't doing much to incentivize work. People need to work hard to earn money. Granted. But for a long time the ball has belonged to the employer and they've made the demands. I think that they maybe don't grasp that treating your workers like a resource and not people is coming to roost. With big chains offering more and more for less skilled labor it makes it easy to walk away from bad employers.
...
The result is skilled labor looking to take easier jobs that will make them the same, or in many cases better pay.
That's true. Nobody wants to hear it but it's true. Everybody wants to bring out the lazy strawman who doesn't want to work but the reality is that the people who actually work for a living have leverage now, and they're using that to work at places that benefit them. That it might not benefit The Economy as a whole isn't their concern nor should it be.
Employers are mad because now they don't hold all the cards anymore. I think it's a good thing TBH. The unspoken notion that we have an entire class of sacrificial Morlocks who are supposed to grind themselves into dust creating an infinite novelty machine so the Eloi can get cheap imported shit from Amazon every 2 days is a problem, not a solution. If someone is going to bust their ass for 60 hours a week to enable the widget pipeline that drives the economy then maybe they should be paid commiserate to the value they create. And if this company won't, another one will.
blues
09-26-2021, 01:33 PM
That's true. Nobody wants to hear it but it's true. Everybody wants to bring out the lazy strawman who doesn't want to work but the reality is that the people who actually work for a living have leverage now, and they're using that to work at places that benefit them. That it might not benefit The Economy as a whole isn't their concern nor should it be.
Employers are mad because now they don't hold all the cards anymore. I think it's a good thing TBH. The unspoken notion that we have an entire class of sacrificial Morlocks who are supposed to grind themselves into dust creating an infinite novelty machine so the Eloi can get cheap imported shit from Amazon every 2 days is a problem, not a solution. If someone is going to bust their ass for 60 hours a week to enable the widget pipeline that drives the economy then maybe they should be paid commiserate to the value they create. And if this company won't, another one will.
Fine. They don't have to take a job they don't want...but the taxpayers shouldn't be paying for them to stay home and leverage the marketplace.
You can look for another job while you're working. It's not my job to feed and clothe you while you sit around the shack if there are jobs you are capable of doing.
Fine. They don't have to take a job they don't want...but the taxpayers shouldn't be paying for them to stay home and leverage the marketplace.
You can look for another job while you're working. It's not my job to feed and clothe you while you sit around the shack if there are jobs you are capable of doing.
I agree. But, I don't think thats happening. If you don't go to work right now, you don't get paid. That hasn't changed. It's easy to blame people being lazy and not working for the labor problems, but it doesn't make it true. Those not making much money still have to pay bills. The money has to come from somewhere and they're going to work to pay it. People are moving to less strenuous or less stressful careerfeilds because the balance doesn't work in their favor anymore.
That's my pure opinion, and I could be wrong. I'm not weeping about the labor issues though.
Fine. They don't have to take a job they don't want...but the taxpayers shouldn't be paying for them to stay home and leverage the marketplace.
You can look for another job while you're working. It's not my job to feed and clothe you while you sit around the shack if there are jobs you are capable of doing.
You, specifically, aren't paying for anyone so they can sit around the shack.
As mentioned earlier the gravy train of federal covid money expired weeks ago.
People pay into Unemployment Insurance while they're working. Anyone "on unemployment" is taking advantage of a system they funded while working. It's also generally a state-level program so outside NC you wouldn't even be paying for anyone anyway.
blues
09-26-2021, 01:50 PM
I'm no expert Cory, I'm not trying to explain macro or microeconomics...it's beyond my lane by a wide swath. I was merely expressing my position vis-a-vis benefits vs. work, whether it is current reality or not. This way I don't have to argue one side or another.
When I graduated from university in 1974...my B.S. degree was worth pretty much that. I went to an untold number of interviews with companies and employment agencies and they looked at me like "what makes you think you deserve a job?" Went nowhere.
So, I drove a taxi for a while...put up a sign in the taxi that I was looking for more meaningful employment. Got an offer from the boss of an air freight company at JFK. Took that, was thankful, but didn't like it. Left to be a salesman at Abercrombie & Fitch. That was fun for a year and a half and then they went Chapter 11.
Took a couple of crap jobs, one was a boiler room op on Wall St. that could only have been marginally legal...and finally got my foot in the door with the government sometime after that. Starting pay in 1977 was $9959 based upon my qualifications under the "outstanding scholar" provision. Almost $200 a week seemed okay for a single guy at 25 so...I spent the next 27 years with uncle and never looked back.
My pay went up more than tenfold in that time...and I've never complained about being underpaid, my pension, or taking three voluntary downgrades to get the positions, classification and locations I was seeking.
And now, I'm here to bust balls with those unwilling to do the same. ;)
You're one of the good guys, Cory, so you should always know that it doesn't matter if you agree with me or not. You've earned my respect and friendship.
blues
09-26-2021, 01:51 PM
You, specifically, aren't paying for anyone so they can sit around the shack.
As mentioned earlier the gravy train of federal covid money expired weeks ago.
People pay into Unemployment Insurance while they're working. Anyone "on unemployment" is taking advantage of a system they funded while working. It's also generally a state-level program so outside NC you wouldn't even be paying for anyone anyway.
I'm more familiar (personally) with the unemployment system than you know. I know how it works and what funds it. In various states.
Anyone have insight on these claims ?
Hat tip to William Monie Bauer for the following information:
“Essentially the trains and ports have formed an old fashion trust (as is Sugar trust, steel trust, oil trust, etc). They are all engaging in anticompetitive, monopolization behavior.
This has driven the costs astronomically higher from $2000 per container (TEU) to $20,000 per TEU to ship out of US Pacific Coast ports before rail costs are considered. All involved (ports and railroads) are profiting beyond belief at the expense of especially small and medium size businesses in the US.
Currently, the leftist cabal that controls CP, CN, BNSF, and soon KS, are engaged slowdown along with US west Coast ports. UP, if it is not in on the game, is swamped and beyond capacity.
None of these entities are hiring for these highly desired and well compensated jobs, yet they claim a labor shortage.
The key to this supply chain crisis (now termed portageddon) is the dwell times at the ports, the second key is the lack of available train slots to move goods.
I have brought this up with Democrats at all levels of the governments involved. Most, are too stupid, and too oblivious, to understand why this is important.
The smarter ones are carefully avoiding the subject.
None are willing to use the Sherman antitrust act.
As I have pointed out, key Democrat money men are behind this trust, including Warren Buffet (BNSF) and Bill Gates(CN) through their very fortuitously timed railroad investments (There are several others - all Democrats). Originally this started as an oil play, using left wing activist groups to shut down pipelines, and fracking in pipeline adjacent US oil fields, in order to drive oil onto rails from the Canadian Tar sands. This caused rails and trains to become extremely devoted to oil transport earning them between $10-30/barrel mostly $30) margins on a 700 barrel tanker cars which squeezed the lower cost margin containers ($2.12 mile average long haul cost) out of priority.
As a result, shippers started bidding on ever diminishing container slots, and those slots have become radically more expensive (again to around $20/long mile), all benefiting the bottom line of railroads.
Truckers have become in short supply because businesses have found it much cheaper to truck shipments and pay truckers very well to do long haul shipping rather than to use either rails or ships to US West Coast ports. This, as this article points out, has now collapsed the availability of short haul truckers to move containers to and from the ports.
Now with the squeeze on container shipping these costs have exploded ($20,000 per TEU to transport across the oceans, and either off load or onload at a US West Coast port, along with another $20,000 to ship to the port by rail = $40,000 per TEU total cost)
It is so bad, I know of businesses in Seattle paying long haul trucker to take containers to (Republican controlled) ports thousands of miles across country to get their product shipped abroad.
A left wing environmentalist who is honest, (ROFLMAO), would realize the huge carbon footprints this cascading crisis has caused as everything is being shipped by truck to South East US ports rather than boat or train from Pacific ports
But to acknowledge this would point a finger at Biden's disastrous decision to end stop all oil development on US public lands, ending the Keystone XL pipeline permanently, along with Trudeau's decision to end similar pipelines in Canada.
Elections have consequences.
Vastly higher carbon footprints, exploding shipping costs, closing small businesses (not to mention businesses never opened), and a collapsing North American supply chain is just a few.
The virtue signaling leftist voters have spoken. They want increased carbon footprints rather than tweets from the Orange man (who drove down America's carbon footprint), the want "Equity" in unemployment rather than any jobs in the US, they want oil on rail cars exploding in our towns and cities rather than on much safer pipelines, they want their super wealthy donors to become even wealthier while small and medium businesses are closed or never started as a result of their policies.
What the leftists wants and have voted for is a third world country, with hugely connected and fabulously wealthy oligarchs on top and everyone else poor and struggling at the bottom.
The US has now gotten what they voted for.....”
I agree. But, I don't think thats happening. If you don't go to work right now, you don't get paid. That hasn't changed. It's easy to blame people being lazy and not working for the labor problems, but it doesn't make it true. Those not making much money still have to pay bills. The money has to come from somewhere and they're going to work to pay it. People are moving to less strenuous or less stressful careerfeilds because the balance doesn't work in their favor anymore.
That's my pure opinion, and I could be wrong. I'm not weeping about the labor issues though.
How are there openings in the better paying and/or less stressful/strenuous jobs for them to migrate to?
How are there openings in the better paying and/or less stressful/strenuous jobs for them to migrate to?
Anyone can flip a burger, and the pay is beginning to rival some skilled jobs. Where did those original burger flippers go? That I don't know. Perhaps they looked for education. Perhaps they're lazy, young, kids who live with Mom and Dad. I honestly don't know.
When I graduated from university in 1974...my B.S. degree was worth pretty much that. I went to an untold number of interviews with companies and employment agencies and they looked at me like "what makes you think you deserve a job?" Went nowhere.
So, I drove a taxi for a while...put up a sign in the taxi that I was looking for more meaningful employment. Got an offer from the boss of an air freight company at JFK. Took that, was thankful, but didn't like it. Left to be a salesman at Abercrombie & Fitch. That was fun for a year and a half and then they went Chapter 11.
Took a couple of crap jobs, one was a boiler room op on Wall St. that could only have been marginally legal...and finally got my foot in the door with the government sometime after that. Starting pay in 1977 was $9959 based upon my qualifications under the "outstanding scholar" provision. Almost $200 a week seemed okay for a single guy at 25 so...I spent the next 27 years with uncle and never looked back.
My pay went up more than tenfold in that time...and I've never complained about being underpaid, my pension, or taking three voluntary downgrades to get the positions, classification and locations I was seeking.
And now, I'm here to bust balls with those unwilling to do the same. ;)
I'm honestly not sure what sort of point you're trying to drive home. You seem a little touchy about the subject, but I figured I'd dive in anyway.
Your story isn't unique against today's 25 y/o trying to migrate their way through the workplace and scratching out some semblance of a career path which is a fleeting concept in today's marketplace for most people outside the public sector. Your starting salary in 1977 is equivalent to almost $44k today when correcting for inflation, so yeah it certainly wasn't bad at all given your lack of professional work experience. I started my current job at $46k/year before LEAP kicked in (we used to not get it during FLETC, which has since changed), and that was as a 30 y/o who served 4 years in the Marines as a commissioned officer, worked urban EMS and had some graduate education.....not someone that participated in a scam ring and drove a cab with Travis Bickle on graves.
I thank my lucky stars for how fortunate I am that my efforts have paid off, but for every "me" that my agency hires there's literally 99.3 other people who like me were qualified for the job but who are still on the cliff's edge, clawing and scratching to "get somewhere". What you just spelled out as your experience? I'm not saying this to be a dick, just trying to be frank and address what I see as an elephant in the room: you'd be a very low-ranked candidate in today's market and likely be one of the millennials who has a college degree with virtually no realistic way of ever paying it off or owning a house. I know people who are twice as accomplished as you were in 1977 applying to that job and yet they can barely even get interviews today. Specific to our profession, if we planted someone with your resume circa-1977 into the lobby of current day candidates waiting for their interviews at a random 1811 job, the interviewers would probably think their buddy from HR who compiled the candidates was either drunk or playing a joke.
Again, I'm not writing that to be a dick, but we should view things through a lens relative to the current day. The more I read your story, the more I think you probably had it easier than the average job candidate today....not harder.
Joe in PNG
09-26-2021, 03:59 PM
The container shortage and shipping slowdown (to get back to the op) is having a big effect on what I do as the shipping and logistics guy for our organization in PNG.
I've had to send out a few emails telling our people that shipping times have doubled, that available space will be limited to essentials, and that they may need to start buying their personal stuff here in country.
To make things even more fun, the US (and other) Postal Service still isn't' really delivering to the Asia-Pacific at the moment. Those packages get sent to New Zealand, thrown in a container, allowed to fill up, then is boated to POM.
DHL is working as normal, but ain't cheap.
Joe in PNG
09-26-2021, 04:10 PM
Regarding the thread drift, notice that the more woke our employment policies become, the more they drift towards the old Roman model?
So, in a very rough correlation, we have a class of people that doesn't really want to work, and wants to be supported off the public coffers, and we're importing a class that will work, but is basically denied the various rights and privileges of citizens.
Already, a good number of people are already aping the old Patrician attitude that work is bad and evil and degrading, so we need a class of inferiors to do those jobs for us.
Now, it has been posted a few times that the generous and overt Fed benefits ran out a couple of weeks ago. Ignoring some of the other Federal & State panem et circenses, one does expect a fair amount of lag from the time the Fed checks stop coming to the time the money runs out; from to the time the money is gone to the time people start actually looking for work; from the time they get hired to the time there work actually has a benefit on to their employers.
I'm honestly not sure what sort of point you're trying to drive home. You seem a little touchy about the subject, but I figured I'd dive in anyway.
Your story isn't unique against today's 25 y/o trying to migrate their way through the workplace and scratching out some semblance of a career path which is a fleeting concept in today's marketplace for most people outside the public sector. Your starting salary in 1977 is equivalent to almost $44k today when correcting for inflation, so yeah it certainly wasn't bad at all given your lack of professional work experience. I started my current job at $46k/year before LEAP kicked in (we used to not get it during FLETC, which has since changed), and that was as a 30 y/o who served 4 years in the Marines as a commissioned officer, worked urban EMS and had some graduate education.....not someone that participated in a scam ring and drove a cab with Travis Bickle on graves.
I thank my lucky stars for how fortunate I am that my efforts have paid off, but for every "me" that my agency hires there's literally 99.3 other people who like me were qualified for the job but who are still on the cliff's edge, clawing and scratching to "get somewhere". What you just spelled out as your experience? I'm not saying this to be a dick, just trying to be frank and address what I see as an elephant in the room: you'd be a very low-ranked candidate in today's market and likely be one of the millennials who has a college degree with virtually no realistic way of ever paying it off or owning a house. I know people who are twice as accomplished as you were in 1977 applying to that job and yet they can barely even get interviews today. Specific to our profession, if we planted someone with your resume circa-1977 into the lobby of current day candidates waiting for their interviews at a random 1811 job, the interviewers would probably think their buddy from HR who compiled the candidates was either drunk or playing a joke.
Again, I'm not writing that to be a dick, but we should view things through a lens relative to the current day. The more I read your story, the more I think you probably had it easier than the average job candidate today....not harder.
Given the naivete of some people I've worked with, some time on the night shift with Travis may not be a bad thing.
https://youtu.be/hr7fEcPV2Bg
Also how common was graduate education in the 1970s relative to today ?
blues
09-26-2021, 04:19 PM
TGS
There was no LEAP when I started, (nor AUO), since I had non-LEO position to start and I had to scratch and claw for a few years to get picked for an LE job, only after doing a 9 month undercover op prior to being recruited...
But I digress. The point was, which I was not being touchy about, your crystal ball notwithstanding, is that people, today, like in my day, have to suck it up and do what it takes to, first, get a job...and then get the job that they want, hopefully, down the road.
As opposed to the opposite.
But thanks for your mostly wrong interpretation of my intent. (And work history. You are making assumptions about the jobs done at the gov't prior... but I'm done wasting time.)
(As I said, I was pretty satisfied with the salary since I didn't have to worry about draw vs. commission, or how many fares I picked up, or doing something else to pick up what I needed to pay the rent, since I hadn't lived at home since high school and the jobs I had prior to Uncle weren't the most remunerative.)
Finis.
Also how common was graduate education in the 1970s relative to today ?
Definitely not as common, and actually a good thing to point out.
You had people with less education, and less debt, getting jobs that paid just as well or better than today. I remember someone who doesn't hang around the forum anymore mention a few years back about how he worked for minimum wage, blah blah blah millennials are lazy, etc etc. When he was working that job for minimum wage after high school with zero professional experience, accreditations, certifications or higher education.....that minimum wage was equal to $26/hour today.
The "walk in proud with your resume and give'em a firm handshake" boomer-gumption-thing doesn't really work like it did back then. I know people that have college degrees and are not slackers, and they are working menial service jobs. The idea of a middle-class man with a spouse who doesn't work that can own a house and raise a family is an absolute fantasy compared to that being the norm "back in the day". To @Blue's point, I'm just trying to point out that people are "sucking it up and doing what it takes" just as much today as they were in the 70s when you could buy a house while working as a low-end salesman at a shoe store.
blues
09-26-2021, 04:33 PM
To @Blue's point, I'm just trying to point out that people are "sucking it up and doing what it takes" just as much today as they were in the 70s when you could buy a house while working as a low-end salesman at a shoe store.
I wouldn't know. I never lived in a private house. My parents never did. My wife never lived in one. And we bought our first home when I was 51.
So, I'll have to take your word for it. Most of the folks I knew growing up, who worked for a living, and whose families did as well, couldn't afford a house.
But, it must've been different in your neighborhood.
Have a good one. I think the one with the bug up his ass is not me.
I wouldn't know. We never lived in a private house. My wife never lived in one. And we bought our first home when I was 51.
So, I'll have to take your word for it. Most of the folks I knew growing up, who worked for a living, and whose families did as well, couldn't afford a house.
But, it must've been different in your neighborhood.
Have a good one. I think the one with the bug up his ass is not me.
Sounds like you just need to suck it up.
:)
*ducks, runs*
littlejerry
09-26-2021, 07:14 PM
Interesting. So 1.6% of the over 16 crowd works out to what, ~4 million people?
Even if everything went back to normal today the total dead and permanently disabled from covid would account for a chunk of that. Once you factor in early retirements, the possibly prolonged "dual income families become single income families while one parent turns their unemployment into full time child care", etc I don't think even conscripting all the people who just "don't want to work" is going to get the labor force participation numbers back to where they were pre-covid.
I doubt those numbers are going to look "normal" for quite some time.
I think the moratorium ends in TX on Oct 1. I guess we'll find out what the impact on labor force participation is soon.
https://www.statista.com/statistics/1191568/reported-deaths-from-covid-by-age-us/
Over 50% of the deaths were aged 75 and up, which were never part of the of the labor force... If anything we've seen a net reduction in people not in the labor force due to COVID deaths of people who had already aged out of the work force.
580k of the 680k deaths were 65+
You keep saying "show me the data" and then keep ignoring it. People who could work, aren't. Lots of possible why's, but it's not even remotely debatable that it's the current reality.
DDTSGM
09-26-2021, 08:21 PM
I wouldn't know. I never lived in a private house. My parents never did. My wife never lived in one. And we bought our first home when I was 51.
So, I'll have to take your word for it. Most of the folks I knew growing up, who worked for a living, and whose families did as well, couldn't afford a house.
But, it must've been different in your neighborhood.
Have a good one. I think the one with the bug up his ass is not me.
I don't want to get hit in the crossfire, but......
From reading your posts in this thread, I'm curious as to whether you had a desire to stay in the NYC area, or lacked the financial wherewithal to move someplace else to seek employment.
DDTSGM
09-26-2021, 08:29 PM
Anyone have insight on these claims ?
I don't know about the ports.
What I've noticed is more extremely long trains of shipping containers coming through our area. Long enough to have a couple engines pulling, an engine or two in the middle, and one or two in the rear. Not unusual to wait for t10-12 minutes as one passes through.
About a month ago, the manager at Home Depot told me that their region distribution center had 51 loaded trailers sitting waiting for tractors to haul them.
So I think there are a lot of forces at work.
And I'm sure there is some unethical/illegal stuff going on as well.
https://www.statista.com/statistics/1191568/reported-deaths-from-covid-by-age-us/
Over 50% of the deaths were aged 75 and up, which were never part of the of the labor force... If anything we've seen a net reduction in people not in the labor force due to COVID deaths of people who had already aged out of the work force.
580k of the 680k deaths were 65+
You keep saying "show me the data" and then keep ignoring it. People who could work, aren't. Lots of possible why's, but it's not even remotely debatable that it's the current reality.
GMJ's post about people "participating in the labor force" included everyone age 16 and older. That definition, AFAIK, has no exclusion for people under 16 but also over any other age. Those 65 year olds are included in the data. Not everyone at that age is retired. The part time greeters at Wal Mart who need more quarters to qualify for social security are included.
Also, I'm not "ignoring the data". I'm ignoring this fabricated reality you want to live in where the missing 4 million people in the labor force all decided to be Reaganesque welfare queens who just are too lazy to work so you can bitch about them. The "why's" and "where did they go once the money ran out" are fundamental to the discussion.
As it is, there are apparently 4 million people who were working before covid that aren't now. Some of them are, in no particular order:
dead from covid
in the hospital due to covid
on disability due to covid
said 'screw it' and retired
suddenly became Dave Ramsey devotees who are stretching their $1200/mo federal benefits in an act of fiscal responsibility hitherto unexercised by the average American
suckling at the teat of unemployment benefits that ran out
Something Else (tm)
Since UI is a state-by-state thing, maybe some states are still extending UI benefits. Though it seems like California, where the shipping container backup is, ended the extended UI benefits on Sep 11 (https://www.edd.ca.gov/About_EDD/coronavirus-2019/fed-ed.htm). Which appears to be data that you're ignoring: there's no more teat to suckle at.
edit: I'd love to see the breakdown of exactly where those people went, but I doubt it exists. Maybe there are still state-level benefits being paid out in some places. But it's an act of unproven wishful thinking to assume people sitting at home who could work but just aren't comprise the majority.
As someone that took the view that people are choosing to not work, thank you for breaking that down, jh9.
littlejerry
09-27-2021, 07:43 AM
The Labor Force Participation Rate accounts for people employed and unemployed over 16 years old. That does not include institutionalized individuals and those who are not seeking employment. You have to keep in mind BLS defines unemployed as someone seeking employment.
The employment population ratio is simple: How many people are working vs how many people are alive:
https://www.bls.gov/charts/employment-situation/employment-population-ratio.htm
This shows roughly 10 million people not working that were.
That's true. Nobody wants to hear it but it's true. Everybody wants to bring out the lazy strawman who doesn't want to work but the reality is that the people who actually work for a living have leverage now, and they're using that to work at places that benefit them. That it might not benefit The Economy as a whole isn't their concern nor should it be.
Employers are mad because now they don't hold all the cards anymore. I think it's a good thing TBH. The unspoken notion that we have an entire class of sacrificial Morlocks who are supposed to grind themselves into dust creating an infinite novelty machine so the Eloi can get cheap imported shit from Amazon every 2 days is a problem, not a solution. If someone is going to bust their ass for 60 hours a week to enable the widget pipeline that drives the economy then maybe they should be paid commiserate to the value they create. And if this company won't, another one will.
"I have never met a man more fair, candid, and honest" -- HG Wells, regarding J. Stalin
We can treat the employers as the bad guys if we like, but nobody's forcing them to be here. We threw the protectionist guy out of office. We are open to the world's competitive forces, and much of the world asks, demands, and receives less than the American worker. We will lose, not because of the materialism of the captains of industry, but because of the materialism of the workforce.
The Labor Force Participation Rate accounts for people employed and unemployed over 16 years old. That does not include institutionalized individuals and those who are not seeking employment. You have to keep in mind BLS defines unemployed as someone seeking employment.
The employment population ratio is simple: How many people are working vs how many people are alive:
https://www.bls.gov/charts/employment-situation/employment-population-ratio.htm
This shows roughly 10 million people not working that were.
Where do you get 10 million? That's not listed in the chart you provided.
Using total numbers (https://en.wikipedia.org/wiki/Demographics_of_the_United_States) and back-of-napkin math is closer to 7 million.
~324 million people in the US, ~60.7 million under age 15. Using your "employment-population ratio" instead of "workforce participation" shows a change in 2.6% from the pre-covid peak. 2.6% of the over 15 population (324m -60.7m = 263.3m) is 6.8m. (Using age 15 instead of 16 because that's what's provided. So there's a bunch of 15 year olds included there that are making that number somewhat larger than it would be if we were just using age 16+.)
As we continue to zero in on an accurate number of people missing from the workforce the larger questions remain unchanged. I don't doubt some people are probably still collecting the (greatly reduced) reduced state benefits but everyone saying that the government needs to pull the plug on unemployment... from here it looks like the plug has already been pulled. So far it doesn't appear to be having the effect some people think it should.
BehindBlueI's
09-27-2021, 08:20 AM
I wouldn't know. I never lived in a private house. My parents never did. My wife never lived in one. And we bought our first home when I was 51.
So, I'll have to take your word for it. Most of the folks I knew growing up, who worked for a living, and whose families did as well, couldn't afford a house.
But, it must've been different in your neighborhood.
I would suggest that was very regional. You could have easily afforded a house in the most of the midwest with something like an entry level factory job. People in my grandparents and parents generations did it all the time.
I went to college with a guy who was a packer at a naval weapon facility. He was the guy who greased the ever loving shit out of a gun then put it in a crate. He told me the story of meeting his future wife's parents in New Hampshire. They questioned his ability to provide for a family on his $10/hr salary. They refused to believe he already owned his own home and car until they saw it in person. Different worlds.
"I have never met a man more fair, candid, and honest" -- HG Wells, regarding J. Stalin
Awesome. Stalinism. As a response to someone saying it's good that the people who are working are doing exactly what they should be doing and going where they're valued the most.
We can treat the employers as the bad guys if we like, but nobody's forcing them to be here.
Correct. Nobody is forcing them to be there, so they're going elsewhere. That's how capitalism works.
edit: above is referring to employees, not employers. I guess your take here is that all the jobs will just go away? Is this some new thread drift about protectionism? Hard to keep up. :rolleyes:
littlejerry
09-27-2021, 08:42 AM
Where do you get 10 million? That's not listed in the chart you provided.
Using total numbers (https://en.wikipedia.org/wiki/Demographics_of_the_United_States) and back-of-napkin math is closer to 7 million.
~324 million people in the US, ~60.7 million under age 15. Using your "employment-population ratio" instead of "workforce participation" shows a change in 2.6% from the pre-covid peak. 2.6% of the over 15 population (324m -60.7m = 263.3m) is 6.8m. (Using age 15 instead of 16 because that's what's provided. So there's a bunch of 15 year olds included there that are making that number somewhat larger than it would be if we were just using age 16+.)
As we continue to zero in on an accurate number of people missing from the workforce the larger questions remain unchanged. I don't doubt some people are probably still collecting the (greatly reduced) reduced state benefits but everyone saying that the government needs to pull the plug on unemployment... from here it looks like the plug has already been pulled. So far it doesn't appear to be having the effect some people think it should.
https://www.census.gov/popclock/
332.8 million people
2.7% drop in employment
~9 million
One stat we lack is an accurate estime of work-able population. Covid disproportionately killed off people out of the work force.
BLS tracks reasons for being unemployed, but again that's only for people actively seeking employment. There isnt good data that I'm aware of on families going from double to single incomes, taking time off for school, retiring early, or accepting a lower quality of life.
One stat we lack is an accurate estime of work-able population. Covid disproportionately killed off people out of the work force.
Right, but killing you isn't the only thing covid can do. It's just the last. I'm not aware of any (temporary or permanent) covid-related disability stats, though.
BLS tracks reasons for being unemployed, but again that's only for people actively seeking employment. There isnt good data that I'm aware of on families going from double to single incomes, taking time off for school, retiring early, or accepting a lower quality of life.
I'm not either. Individually I doubt any one of those causes represents a significant portion of that missing 2.6% but combined they may.
Borderland
09-27-2021, 12:29 PM
I wouldn't know. I never lived in a private house. My parents never did. My wife never lived in one. And we bought our first home when I was 51.
So, I'll have to take your word for it. Most of the folks I knew growing up, who worked for a living, and whose families did as well, couldn't afford a house.
But, it must've been different in your neighborhood.
Have a good one. I think the one with the bug up his ass is not me.
My parents owned their house. I think they bought it in the early 50's. I'm pretty sure my first wife's parents bought their house in the 50's also.
My first wife and I bought our first house when I was 29 and she was 25. We both had pretty good jobs with college degrees at the time.
The big difference I see now is debt. People in their 20's and 30's are buried in debt. I never had any debt until I signed a bank loan for a new house when I was 29. I owned that house for 17 years. I've owned my present house for 26 years.
I see people who want what their parents have, or more, and aren't afraid to carry a massive debt load to get it. It's like playing poker with someone else's money. If you lose it you still own the debt. If you accumulate enough of it, like the gov't, sooner or later there has to be a reset. For an individual it's bankruptcy, for a country it's economic collapse. That's what we're seeing. Less personal wealth, tons more debt, and no body willing to loan you any more money because they know you can't repay the debt. Insolvency on a grand scale. The ship is on the rocks.
peterb
09-27-2021, 01:05 PM
A couple of interesting graphs of retail jobs — participation and wages — in here:
https://www.npr.org/2021/09/27/1039706916/retail-jobs-are-treated-as-a-temporary-bridge-to-something-better-but-why
People are quitting retail jobs at record rates.
Welder
09-27-2021, 03:08 PM
Less personal wealth, tons more debt, and no body willing to loan you any more money because they know you can't repay the debt. Insolvency on a grand scale. The ship is on the rocks.
There are people standing in line to loan me and people like me money. Plenty of ships are afloat. Now is a great time to be taking out a loan; interest rates have seldom been better. You need good credit, repayment capacity, and usually some form of collateral, but there's nothing new about that.
People with no repayment capacity and/or bad credit and/or no collateral have been trying to get loans since the beginning of time. Nothing new there either, and why should anyone with a brain cell loan money to someone like that? I know I wouldn't.
A couple of interesting graphs of retail jobs — participation and wages — in here:
https://www.npr.org/2021/09/27/1039706916/retail-jobs-are-treated-as-a-temporary-bridge-to-something-better-but-why
People are quitting retail jobs at record rates.
During the pandemic I had to do some things that were risky (or had unknown consequences) for my health. I also have a pretty strong public service motivation and work in a role where personal security is not always assured. My compensation reflects that, and it's part and parcel with what I want to be when I grow up. Nothing about the current situation has made me re-evaluate my employment.
The poor folks manning the checkout at the grocery store, or filling any of the other "essential" roles in retail signed up for none of that, and their pay sucks. They are/were literally risking their lives every day, for terrible wages, and its 100% what they did not sign up for. I am frankly surprised anyone is still willing to work in retail at any price, let alone the garbage wages that most employers are trying to get away with offering. Factor in the hot potato where retail workers are now dealing with possibly enforcing business pandemic control policies (or alternatively, stuck in a workplace that proudly has no safety policies), and it's shocking that anyone bothers to show up and open the front doors for retail and food service sites. It's a basic supply and demand problem, but I am seeing a shocking lack of businesses applying basic economics and paying more for the rare and desirable commodity.
Borderland
09-27-2021, 04:21 PM
There are people standing in line to loan me and people like me money. Plenty of ships are afloat. Now is a great time to be taking out a loan; interest rates have seldom been better. You need good credit, repayment capacity, and usually some form of collateral, but there's nothing new about that.
People with no repayment capacity and/or bad credit and/or no collateral have been trying to get loans since the beginning of time. Nothing new there either, and why should anyone with a brain cell loan money to someone like that? I know I wouldn't.
I don't know. Maybe you could ask some loan officers that were making loans for the 465 banks that failed from 2008-2012.
DDTSGM
09-27-2021, 04:43 PM
I don't know. Maybe you could ask some loan officers that were making loans for the 465 banks that failed from 2008-2012.
Do you really think they failed from making loans to people with the concept of 'low credit, no credit, we'll give you a chance?'
Borderland
09-27-2021, 04:53 PM
Do you really think they failed from making loans to people with the concept of 'low credit, no credit, we'll give you a chance?'
That's pretty funny.
I think they knew that if the bank failed the worse thing that could happen is they would lose their job. In the mean time they were making a commission on every loan they wrote. It wasn't their money they were loaning and the tax payer bailed out the banks. What could go wrong. ;)
I bet some of them never even lost their job.
Do you really think they failed from making loans to people with the concept of 'low credit, no credit, we'll give you a chance?'
Yes?
Borderland
09-27-2021, 05:05 PM
During the pandemic I had to do some things that were risky (or had unknown consequences) for my health. I also have a pretty strong public service motivation and work in a role where personal security is not always assured. My compensation reflects that, and it's part and parcel with what I want to be when I grow up. Nothing about the current situation has made me re-evaluate my employment.
The poor folks manning the checkout at the grocery store, or filling any of the other "essential" roles in retail signed up for none of that, and their pay sucks. They are/were literally risking their lives every day, for terrible wages, and its 100% what they did not sign up for. I am frankly surprised anyone is still willing to work in retail at any price, let alone the garbage wages that most employers are trying to get away with offering. Factor in the hot potato where retail workers are now dealing with possibly enforcing business pandemic control policies (or alternatively, stuck in a workplace that proudly has no safety policies), and it's shocking that anyone bothers to show up and open the front doors for retail and food service sites. It's a basic supply and demand problem, but I am seeing a shocking lack of businesses applying basic economics and paying more for the rare and desirable commodity.
Ever think about when a grocery store has to raise it's wages by 20% to keep checkers and what that's going to do to food prices? I've noticed that Costco has as many self check isles as isles with human checkers now. Two years ago they had one self check isle for every 5 with checkers. Nobody ever used the self check. Now it's 50/50 at my local Costco.
Caballoflaco
09-27-2021, 05:22 PM
I don't know. Maybe you could ask some loan officers that were making loans for the 465 banks that failed from 2008-2012.
Do you really think they failed from making loans to people with the concept of 'low credit, no credit, we'll give you a chance?'
It’s complicated is generally the correct answer when we look at any modern economic information, but this article gives a good basic run down on how/why large investors were incentivized to loan money to people who were likely to default.
https://www.investopedia.com/ask/answers/032315/were-collateralized-debt-obligations-cdo-responsible-2008-financial-crisis.asp
And then the market realized they could make money on those failing investments, similar to how they got caught in the whole GameStop action this year, which is why some of us were happy to see them get screwed by the weaponized Autists of Reddit, despite knowing that it was also harming regular folks too.
https://www.npr.org/2011/05/02/135846486/how-some-made-millions-betting-against-the-market
ETA: to not make this too much of a tangent, the above is why I don’t doubt that someone somewhere isn’t purposefully making bank on the current situation like HCM posted.
Borderland
09-27-2021, 05:55 PM
It’s complicated is generally the correct answer when we look at any modern economic information, but this article gives a good basic run down on how/why large investors were incentivized to loan money to people who were likely to default.
https://www.investopedia.com/ask/answers/032315/were-collateralized-debt-obligations-cdo-responsible-2008-financial-crisis.asp
And then the market realized they could make money on those failing investments, similar to how they got caught in the whole GameStop action this year, which is why some of us were happy to see them get screwed by the weaponized Autists of Reddit, despite knowing that it was also harming regular folks too.
https://www.npr.org/2011/05/02/135846486/how-some-made-millions-betting-against-the-market
ETA: to not make this too much of a tangent, the above is why I don’t doubt that someone somewhere isn’t purposefully making bank on the current situation like HCM posted.
It's still the banks, except they've found another way to suck the life blood out of the US economy.
The reforms were well intentioned, but, as we’ll see, they haven’t kept the banks from falling back into old, bad habits. After the housing crisis, subprime CDOs naturally fell out of favor. Demand shifted to a similar—and similarly risky—instrument, one that even has a similar name: the CLO, or collateralized loan obligation. A CLO walks and talks like a CDO, but in place of loans made to home buyers are loans made to businesses—specifically, troubled businesses. CLOs bundle together so-called leveraged loans, the subprime mortgages of the corporate world. These are loans made to companies that have maxed out their borrowing and can no longer sell bonds directly to investors or qualify for a traditional bank loan. There are more than $1 trillion worth of leveraged loans currently outstanding. The majority are held in CLOs.
https://www.theatlantic.com/magazine/archive/2020/07/coronavirus-banks-collapse/612247/
peterb
09-27-2021, 06:00 PM
Ever think about when a grocery store has to raise it's wages by 20% to keep checkers and what that's going to do to food prices? I've noticed that Costco has as many self check isles as isles with human checkers now. Two years ago they had one self check isle for every 5 with checkers. Nobody ever used the self check. Now it's 50/50 at my local Costco.
For calibration: as a percentage of household income, people in the US spend less on food than in every other country in the world.
https://www.weforum.org/agenda/2016/12/this-map-shows-how-much-each-country-spends-on-food/
Joe in PNG
09-27-2021, 06:19 PM
I'm seeing a lot of comparisons to decades past, but consider- we generally spend a lot more on a lot more frivolities and non-essentials that didn't exist a few decades ago.
So, people are paying for cable or satellite TV, plus a couple of streaming services, then there's the multiple cell phone plans (plus data), music streaming and downloads, video game subscriptions, and so on.
We're also buying electronics at a higher rate- new versions of the latest phones, tablets, and computers, plus upgrading the TV set every few years.
We're also spending more on lifestyle- daycare, after school care, going out to eat more often, and so on. We buy & wear a lot more clothing.
Even the houses are bigger and have more stuff in them. The basic starter house of the 50's-60's was a lot smaller than the average "McMansion" of today.
And hell, even in the shooting community, we own a lot more guns and shot a whole heck of a lot more.
Individually, these cost are rather small- but added together, it's a big chunk of money.
Borderland
09-27-2021, 06:52 PM
For calibration: as a percentage of household income, people in the US spend less on food than in every other country in the world.
https://www.weforum.org/agenda/2016/12/this-map-shows-how-much-each-country-spends-on-food/
That might have something to do with the geographic area of the US and the population density. The US is recognized as the top food exporter in the world.
That isn't going to change our wage structure for employees of retail grocery stores. That's mostly a labor market/corporate profit thing.
BehindBlueI's
09-27-2021, 07:03 PM
Ever think about when a grocery store has to raise it's wages by 20% to keep checkers and what that's going to do to food prices?
Labor cost is roughly 10% of the expenses of a chain grocery store, so even if the 20% was across the board and included managers you're looking at a 2% increase in operating costs. Kroger's dividend is about 1.9%.
Borderland
09-27-2021, 07:22 PM
I'm seeing a lot of comparisons to decades past, but consider- we generally spend a lot more on a lot more frivolities and non-essentials that didn't exist a few decades ago.
So, people are paying for cable or satellite TV, plus a couple of streaming services, then there's the multiple cell phone plans (plus data), music streaming and downloads, video game subscriptions, and so on.
We're also buying electronics at a higher rate- new versions of the latest phones, tablets, and computers, plus upgrading the TV set every few years.
We're also spending more on lifestyle- daycare, after school care, going out to eat more often, and so on. We buy & wear a lot more clothing.
Even the houses are bigger and have more stuff in them. The basic starter house of the 50's-60's was a lot smaller than the average "McMansion" of today.
And hell, even in the shooting community, we own a lot more guns and shot a whole heck of a lot more.
Individually, these cost are rather small- but added together, it's a big chunk of money.
I'll have to back up a little here. I said in an earlier post that we bought our first house in 78. That isn't true because we bought a house in 76. I just forgot about that because we owned it for only 2 years.
Anyway, it was about 1000 sq ft. and we paid 20K for it. That's a pretty small house by todays standards but with inflation and added living space it would only be a 150K house today. The estimated value is now 600K.
My point, and yours is also I suspect, is we spend more than we did in the 70's for everything. A lot more, even when we consider inflation. Wages haven't kept pace with our spending habits. We spend more than we make and borrow to cover the difference, like the fed.
Joe in PNG
09-27-2021, 07:33 PM
I'll have to back up a little here. I said in an earlier post that we bought our first house in 78. That isn't true because we bought a house in 76. I just forgot about that because we owned it for only 2 years.
Anyway, it was about 1000 sq ft. and we paid 20K for it. That's a pretty small house by todays standards but with inflation and added living space it would only be a 150K house today. The estimated value is now 600K.
My point, and your also I suspect, is we spend more than we did in the 70's for everything. A lot more, even when we consider inflation. Wages haven't kept pace with our spending habits. We spend more than we make and borrow to cover the difference
Who would have thought that the modern leisure activity of laying around and doing nothing would become so very expensive?
Of course, people would actually have more money if they were better at managing what they have now. If you were to increase the wages of the vast majority of average people, they'd wind up in even more debt.
Labor cost is roughly 10% of the expenses of a chain grocery store, so even if the 20% was across the board and included managers you're looking at a 2% increase in operating costs. Kroger's dividend is about 1.9%.
That is only part of labor. The cost of the food sold in the grocery store is a large percentage, and if food producers are also increasing wages, that will drive up costs.
around Bozeman, McDonalds had increased starting wages from $12 to $18/hour and still can't fill their positions. Literally every business is looking for staff. The local hospital has 450 open positions. I have never seen such a challenging time to recruit and retain staff.
Borderland
09-27-2021, 07:43 PM
Labor cost is roughly 10% of the expenses of a chain grocery store, so even if the 20% was across the board and included managers you're looking at a 2% increase in operating costs. Kroger's dividend is about 1.9%.
So will the employees get a 20% pay increase?
The dividend is what investors can make which is only taxed at 15% up to 441k. I doubt any of the employees are making 441K/yr.
I think I know where you're going with this. ;)
Borderland
09-27-2021, 07:54 PM
Who would have thought that the modern leisure activity of laying around and doing nothing would become so very expensive?
Of course, people would actually have more money if they were better at managing what they have now. If you were to increase the wages of the vast majority of average people, they'd wind up in even more debt.
It's a drug and the dem congress/adm is selling it. Personally I hope the GOP torpedo's the debt ceiling increase.
Welder
09-27-2021, 07:57 PM
If you were to increase the wages of the vast majority of average people, they'd wind up in even more debt.
Amen, amen, amen. Don't care if you make $40k or $400k. Living within your means (the old definition of 'within your means' didn't include maxed out credit cards and HELOCs) and delayed gratification are remnants of another time and another way of thinking.
Today we (the collective 'we'), and I include myself, believe in leveraging ourselves and counting our chickens before they're hatched. I've built my business this way, and the risks involved are real. It's a fine line we walk. As far as business owners go, I'm probably more risk averse than most. My machines are newer but my trucks are older and everything is paid for. In my personal life, I'm about to have to double my debt load in order to add on to the house to go along with a new relationship that includes 3 kids as well as their mother. It frankly scares me to death, and I don't care whether the bank says it's no problem at my repayment capacity and collateral level or not. I won't like it, but I'll shut my eyes and do it.
But I'm a relic in that I was raised by parents who saved up their money and then paid cash. I kid you not, my Mom would only buy one $0.99 Christmas light every year until we had one in each of the rooms of our house that faced the road. That's how much of a skinflint she was. We laugh at and make fun of stuff like that today.
Borderland
09-27-2021, 07:59 PM
That is only part of labor. The cost of the food sold in the grocery store is a large percentage, and if food producers are also increasing wages, that will drive up costs.
around Bozeman, McDonalds had increased starting wages from $12 to $18/hour and still can't fill their positions. Literally every business is looking for staff. The local hospital has 450 open positions. I have never seen such a challenging time to recruit and retain staff.
The shit just hit the fan.
I'm wondering how many people here, who are mostly above average intelligence, some way above, realize this?
peterb
09-27-2021, 08:06 PM
around Bozeman, McDonalds had increased starting wages from $12 to $18/hour and still can't fill their positions. Literally every business is looking for staff. The local hospital has 450 open positions. I have never seen such a challenging time to recruit and retain staff.
Well, if you believe that a job in retail or almost anything entry-level and customer-facing is a path to nowhere, there’s no reason not to jump ship when someone else offers slightly better wages and/or working conditions.
Dealing with the general public in a retail or service job is usually an occupational hazard, not a benefit.
The customer is NOT always right, but a lot of managers will not back up their low-level employees when customers are jerks.
I just listened to a talk by a consultant that included a description of a barista who worked essentially the same job at two different hotels. Same wage, but loved one job and tolerated the other. Why? The quality of the management.
I’ve read several stories about the spiral of customers being cranky about slow service due to low staffing, and staff quitting because of cranky customers. :-)
LittleLebowski
09-27-2021, 08:09 PM
https://pistol-forum.com/showthread.php?49924-Real-life-Project-Mayhem
Well, if you believe that a job in retail or almost anything entry-level and customer-facing is a path to nowhere, there’s no reason not to jump ship when someone else offers slightly better wages and/or working conditions.
Dealing with the general public in a retail or service job is usually an occupational hazard, not a benefit.
The customer is NOT always right, but a lot of managers will not back up their low-level employees when customers are jerks.
The pay thing is not just entry level positions, because increases at entry level positions impact pay at mid level positions, and further in organizations. Sign on bonuses are almost a given at all level of positions.
No one has been able to explain to me what the cause is for so many open positions, that were previously filled, given the level of increases which commonly have been approaching 30 percent or more.
Borderland
09-27-2021, 08:19 PM
Well, if you believe that a job in retail or almost anything entry-level and customer-facing is a path to nowhere, there’s no reason not to jump ship when someone else offers slightly better wages and/or working conditions.
Dealing with the general public in a retail or service job is usually an occupational hazard, not a benefit.
The customer is NOT always right, but a lot of managers will not back up their low-level employees when customers are jerks.
I honestly have sympathy for retail who have to deal with the general public. I've never given any of those employees a reason to feel they need another job. Mostly they're well trained and doing a fantastic job.
I wouldn't last a week in that job with all the screaming Karen's out there.
The next big fail will be staff that work in health care.
LittleLebowski
09-27-2021, 08:21 PM
The pay thing is not just entry level positions, because increases at entry level positions impact pay at mid level positions, and further in organizations. Sign on bonuses are almost a given at all level of positions.
No one has been able to explain to me what the cause is for so many open positions, that were previously filled, given the level of increases which commonly have been approaching 30 percent or more.
I apologize if I drift the thread, but I believe this is true.
77690
peterb
09-27-2021, 08:28 PM
With growth in e-commerce and work-from-home, transportation, distribution, and delivery are all growing. Distribution centers are popping up in all sorts of places that aren’t major cities. A warehouse job may not be great but you don’t have to deal with the public.
Borderland
09-27-2021, 08:35 PM
With growth in e-commerce and work-from-home, transportation, distribution, and delivery are all growing. Distribution centers are popping up in all sorts of places that aren’t major cities. A warehouse job may not be great but you don’t have to deal with the public.
Why is the USPS having problems hiring? My local USPS has had we're hiring signs up for months. My mail delivery has gone from 1:30 PM to 3:30 PM.
Might have something to do with the $17/hr wage they offer.
Amen, amen, amen. Don't care if you make $40k or $400k. Living within your means (the old definition of 'within your means' didn't include maxed out credit cards and HELOCs) and delayed gratification are remnants of another time and another way of thinking.
Today we (the collective 'we'), and I include myself, believe in leveraging ourselves and counting our chickens before they're hatched. I've built my business this way, and the risks involved are real. It's a fine line we walk. As far as business owners go, I'm probably more risk averse than most. My machines are newer but my trucks are older and everything is paid for. In my personal life, I'm about to have to double my debt load in order to add on to the house to go along with a new relationship that includes 3 kids as well as their mother. It frankly scares me to death, and I don't care whether the bank says it's no problem at my repayment capacity and collateral level or not. I won't like it, but I'll shut my eyes and do it.
But I'm a relic in that I was raised by parents who saved up their money and then paid cash. I kid you not, my Mom would only buy one $0.99 Christmas light every year until we had one in each of the rooms of our house that faced the road. That's how much of a skinflint she was. We laugh at and make fun of stuff like that today.
That way of thinking isn't gone, just isn't talked about. My wife and I have reasonable mortgage debt, and one very modest car loan. Both of which are set to pay off early.
We laugh at and make fun of stuff like that today.
My grandparents were like that as well and eventually lost their home in retirement, moved into a trailer park and died paupers.
Being "thrifty" has nothing to do with knowing how to manage money well. The chickens came home to roost when the economy changed and all these thrifty old people like my grandparents had nothing but CDs and savings accounts, which today isn't too much different than lighting your money on fire given the ROI vs inflation.
So, compared to when they were alive there's very limited ability for people at or below the median threshold to effectively save for the future given that pensions are a thing of the past for everyone except government workers (and only 7 of 50 states were properly funding pensions, last I checked) and many positions at/below the median don't offer a 401k.....not to mention the realities about 401ks are a little depressing (https://20somethingfinance.com/401k-match/) for a significant chunk of people.
Joe in PNG's point is spot on though regarding financial literacy. No disagreement on that. I wonder how much of it is people just giving up figuring they're fucked anyway or just kicking the can down the road because it's just too stressful to think about.
My sister is a teacher with a pension, and her husband is a home inspector....great salary, but no benefits or retirement plans. The only feasible way they can plan their retirement is to move out of country to central America, otherwise they'd have to retire to inner-America where they've never lived and have nothing they want in retirement. That's a dual-income couple, which is also something we've neglected to discuss thus far: the disappearance of viable single-income households compared to years past. The only people I know making it work (so from my social circle we're talking NOVA and the northeast US) aren't just living "thrifty" lives; they're basically poor. One couple I know, they're virtually destitute living on the husbands salary as a teacher while the wife raises the small girl, and they live in an extremely small house that is fairly run-down and hasn't been upgraded probably since the 70s or 80s...drive 20+ year old vehicles, heat the house in the winter almost exclusively with wood they cut down, eating out is a once or twice a year event, regular purchases from Starbucks isn't even in the realm of possibility, etc. I'm pointing this all out just to show what it looks like for someone "doing it the old fashioned way" that doesn't participate in many of our modern conveniences or luxuries. They're still poor as fuck and would be homeless if he got laid off.
So, the viability of truly saving for retirement among the average American, and especially the below average income household, is honestly pretty low regardless of their financial literacy or thriftiness.
Borderland
09-27-2021, 08:41 PM
I apologize if I drift the thread, but I believe this is true.
77690
Nothing like a stimulus check to enforce the fact that your federal gov't cares about your well being.
That money was yours before the fed took it and gave it back to you. :confused:
That is only part of labor. The cost of the food sold in the grocery store is a large percentage, and if food producers are also increasing wages, that will drive up costs.
around Bozeman, McDonalds had increased starting wages from $12 to $18/hour and still can't fill their positions. Literally every business is looking for staff. The local hospital has 450 open positions. I have never seen such a challenging time to recruit and retain staff.
Food costs are already going up. Everything is going up. I think its just getting started. I don't have a link to reference it, but today on the radio as I was driving around, they were talking about how most people spend more, in total, on various taxes, than they do on food in a year. That is a problem IMHO. Frankly, wages for the vast majority of Americans NEED to go up, or prices of things need to come down (maybe both). Housing for starters. My home has roughly doubled in "cost" since we bought it just 3-4 years ago. If I had to buy today, I don't know if we could afford it. Several hundred thousand in equity in such a short time seems great, until you look around and want to move, and realize everyone else is living in an inflated house too. Even prices in the boondocks are out of control.
My company had a opening for a SCADA/radio/IT/Programming type position, requiring a degree in a related field, and really preferring someone with several years experience in a WIDE variety of systems/languages... Sometimes office job, sometimes (most times probably) working in the field. Rotating on-call (365 days a year, we NEVER shut down), etc... Starting pay is listed as ~$22-23/hr. Median home price in our state is approaching $500,000 I think. Your average home here in the immediate area, not in the ghetto, is hovering around $400-450k. I don't know how people afford that with two incomes, let alone one at $22/hr. Starting at $18 at McDonalds looks better than a "professional" job... If you start thinking about what those degrees, student loans, and/or experience are going to cost you.
I'm not sure what to make of it all... but none of it bodes well.
Caballoflaco
09-27-2021, 08:53 PM
I’ve been following some of the current housing market too, though I’m sure there are people more knowledgeable than me. One contributing factor is that investment firms are using their clout to buy fairly large number of homes in areas with growing economies.
This article is from Slate, but is fairly even handed and matches what I’ve seen from other sources.
https://www.google.com/amp/s/slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.amp
not exactly accurate that investors are “buying every single-family house they can find,” as some have suggested. If that were true, their market share in the United States wouldn’t be a piddling 15 percent. They’re really buying up the stock of relatively inexpensive single-family homes built since the 1970s in growing metro areas. They mostly ignore bigger and more expensive houses, especially ones that are move-in ready: Wealthy boomers and the nation’s finance and tech bros nab those properties. And they’re also ignoring cities with stable or shrinking populations, like Providence and Pittsburgh.
But investors are depleting the inventory of the precise houses that might otherwise be obtainable for younger, working- and middle-class households, in the cities where those workers can easily find good-paying jobs, like Atlanta (22 percent of home purchases according to Redfin data), Charlotte (22 percent), and Phoenix (20 percent). More importantly, they’re able to scour those markets scientifically and systematically to make cash offers on the most attractively priced properties. While normal people buy houses when they actually need to move somewhere, (savvy) investors buy houses several years before a bunch of people need to move to an area. Whether they’re tracking where major employers are building new offices or looking at public school enrollment data, being ahead of the market gives big firms a big leg up.
Borderland
09-27-2021, 08:54 PM
Food costs are already going up. Everything is going up. I think its just getting started. I don't have a link to reference it, but today on the radio as I was driving around, they were talking about how most people spend more, in total, on various taxes, than they do on food in a year. That is a problem IMHO. Frankly, wages for the vast majority of Americans NEED to go up, or prices of things need to come down (maybe both). Housing for starters. My home has roughly doubled in "cost" since we bought it just 3-4 years ago. If I had to buy today, I don't know if we could afford it. Several hundred thousand in equity in such a short time seems great, until you look around and want to move, and realize everyone else is living in an inflated house too. Even prices in the boondocks are out of control.
My company had a opening for a SCADA/radio/IT/Programming type position, requiring a degree in a related field, and really preferring someone with several years experience in a WIDE variety of systems/languages... Sometimes office job, sometimes (most times probably) working in the field. Rotating on-call (365 days a year, we NEVER shut down), etc... Starting pay is listed as ~$22-23/hr. Median home price in our state is approaching $500,000 I think. Your average home here in the immediate area, not in the ghetto, is hovering around $400-450k. I don't know how people afford that with two incomes, let alone one at $22/hr. Starting at $18 at McDonalds looks better than a "professional" job... If you start thinking about what those degrees, student loans, and/or experience are going to cost you.
I'm not sure what to make of it all... but none of it bodes well.
The cost of living will continue to skyrocket. Your income, even with a college degree, not so much. Been that way for a few years now.
HeavyDuty
09-27-2021, 08:57 PM
My company had a opening for a SCADA/radio/IT/Programming type position, requiring a degree in a related field, and really preferring someone with several years experience in a WIDE variety of systems/languages... Sometimes office job, sometimes (most times probably) working in the field. Rotating on-call (365 days a year, we NEVER shut down), etc... Starting pay is listed as ~$22-23/hr. Median home price in our state is approaching $500,000 I think. Your average home here in the immediate area, not in the ghetto, is hovering around $400-450k. I don't know how people afford that with two incomes, let alone one at $22/hr. Starting at $18 at McDonalds looks better than a "professional" job... If you start thinking about what those degrees, student loans, and/or experience are going to cost you.
I'm not sure what to make of it all... but none of it bodes well.
Your company is out of their collective minds.
peterb
09-27-2021, 08:58 PM
That's a dual-income couple, which is also something we've neglected to discuss thus far: the disappearance of viable single-income households compared to years past. The only people I know making it work (so from my social circle we're talking NOVA and the northeast US) aren't just living "thrifty" lives; they're basically poor.
One of the causes for the growing disparity in household incomes is the increased number of women in high-paying professions. It used to be that (stereotypically) doctors and lawyers would marry lower-income women — because there were very few high-income women. Now high-income professionals marry other high-income professionals, which concentrates more income and wealth at the top. It’s not a nefarious plot, but it is a social change with real consequences.
Constant-dollar incomes haven’t changed much for the folks on the bottom.
Interesting point, peterb. I never thought about that.
Caballoflaco
09-27-2021, 09:10 PM
One of the causes for the growing disparity in household incomes is the increased number of women in high-paying professions. It used to be that (stereotypically) doctors and lawyers would marry lower-income women — because there were very few high-income women. Now high-income professionals marry other high-income professionals, which concentrates more income and wealth at the top. It’s not a nefarious plot, but it is a social change with real consequences.
Constant-dollar incomes haven’t changed much for the folks on the bottom.
Yup, and while it does happen, it’s much rarer for women to marry down the social-economic ladder. So with women earning more college degrees than men the dating/marriage pool is decreased even further.
Your company is out of their collective minds.
Tell me about it...
ETA: I don't know if anyone internal applied for that job, and I doubt they found much traction looking outside. We'll see I guess. When I say "my company" I should really say "the quasi-governmental agency" I work for. It isn't *mine*... and I guess its not exactly a *company* ... The benefits are decent. I'm sure if they found a good fit for the position that had the right "stuff" they'd probably find a way to raise the starting wage for that person, but I doubt we'd be talking double that rate.
LittleLebowski
09-27-2021, 10:43 PM
One of the causes for the growing disparity in household incomes is the increased number of women in high-paying professions. It used to be that (stereotypically) doctors and lawyers would marry lower-income women — because there were very few high-income women. Now high-income professionals marry other high-income professionals, which concentrates more income and wealth at the top. It’s not a nefarious plot, but it is a social change with real consequences.
Constant-dollar incomes haven’t changed much for the folks on the bottom.
I wish my wife makes what I do.
DDTSGM
09-27-2021, 11:01 PM
Here's my walked to school in thigh deep snow, uphill both ways story:
I started as a police officer in Kansas for 3.87 (pretty sure) in 1976. Within a year I had bought a house for $20,000.00. A year later I had steel siding put on it for $3,200.00 IIRC, and the year after that we had the bathroom redone - adding a shower and pretty much tiling the whole thing, again IIRC, we paid $2,400.00 to the kid that did it - interesting back story, he was just out of high school, had worked fore his dad - the tile guy - until his dad had passed away, his mother was running the office and he was trying to keep the business viable, he did a great job on our bathroom.
In 1980 we sold that house for $34,000.00 and I took a job that paid me $15,000.00 a year. I remember the decision was easy - I had made a little over $9,000 the year before, which would have put my hourly wage at roughly $4.50 an hour - as a patrol sergeant on a small town police department.
Donuts were a nickel, candy bars and pop were a dime. Cable cost me a whooping $7.95 a month.
If you compare those costs to today you can see that prices for some goods have increased over 10 times during the ensuing years. Cost of goods is the same irrespective of the salary/wage you are making. Trust me on this, no one in Kansas is paying $38.70 an hour/$77,400.00 a year for entry level cops, which is ten times what I started at in 1976.
I think we need to keep in mind that even then, policing paid better than a lot of blue collar jobs.
But, heck, why did I waste my breath, everyone knows that wages for the middle and lower folks have been stagnant for the last 20+ years.
Here's the deal, a couple days ago someone posted a link to a book entitled: A Capitalism for the People: Recapturing the Lost Genius of American Prosperity
by Luigi Zingales. Using the metric that you can chart the intelligence of a person by how much their beliefs dovetail with yours, Luigi is a genius. He says what I believe much more succinctly than I could:
Here is the rub: 'Americans can not play the blame on one bad guy. Through our retirement funds and stock investments, WE are the owners of the very companies that lobby to grab our tax money and dominate our political life.'
That being said, I constantly need to remind myself that not everyone has the opportunity, and the drive, to put 1/2 of every raise they got into tax deferred SRA's for most of their career. In fact, I need to remind myself that most American's don't have retirement plans even close to what those of us who work(ed) for state, local and federal government agencies have the opportunity to benefit from.
During the decade that ended in 2012, the real income of the median American family dropped seven percent. (Zingales)
The median male in his twenties makes 19 percent less (in real terms) than his father made at the same age. (Zingales)
Not much has changed in that respect since 2012.
I don't know how we can have a free market system if we legislate morality. In my viewpoint we need to get back to the days when employees were looked upon as people, not resources, and the employer felt some responsibility for their well being. I'll be damned if I know how to accomplish that in today's world.
Welder
09-27-2021, 11:33 PM
Being "thrifty" has nothing to do with knowing how to manage money well.
I have to disagree. The two ways I have to make money at my business, and therefore personally as well, are to spend less / cut costs, and to raise my income. Obviously these are broad topics and certain expenses can't be cut without negative impact while increases in income without proper investments (savings accounts and CD's being poor investments as you alluded to above) are meaningless as well. Being thrifty does affect wealth, though...it's just not the be-all, end-all.
My Mom (the same one with the Christmas lights?) had both of us kids set up with savings accounts, checking accounts, money market accounts, and mutual funds before age 10. My checks actually say I've had an account at my bank since 1987, which is funny because I was 9 in '87. We weren't a rich family. My Mom was a teacher and Dad was a farmer bringing in a very small income. The farm paid me when I started working there at age 7, and Mom made me save 90% of it, allowing me to spend 10%.
I know a lot of kids didn't get the "opportunity" to work through their childhood, which is honestly a shame although I wouldn't wish my exact "childhood" on anybody. But by going to community college and then transferring into a 4-year school, and then taking classes like a madman so I could finish up a semester early because my money was going to run out, I was able to walk in December free of debt with $300 in the bank. I then squandered my education by becoming a mechanic and made generally bad decisions for 20 years until I found myself here, but hey, that's all on me. I was raised right.
Joe in PNG's point is spot on though regarding financial literacy. No disagreement on that. I wonder how much of it is people just giving up figuring they're fucked anyway or just kicking the can down the road because it's just too stressful to think about.
I just ran a quick compound interest calculation. As you said, a lot of us have given up on retirement. I had a plan but it went to crap with the divorce; I got the real estate but I also took on all of the debt and I lost hope for ever being able to retire. But. If I pulled $10k out of my butt (sold some more guns, sold a couple welders, took it out of my HELOC, took out a tiny personal loan, etc), got it earning 7% interest, and then added $1000 a month to it for 30 years, which would make me in my early 70's, I'd still have $1.2 million. That's assuming that my 'normal' income could float the payments for that initial loan, cover taxes, etc while leaving the $10k and the monthly payments intact. Big assumption, but entirely possible looking at my current financial situation. I'd miss $12k a year, I'd feel it, but I'd survive while eating out less and spending less on hobbies and such. That's my point about delayed gratification. Even after a divorce where I lost A LOT, it's still possible for me to come back even in my mid 40's.
Those calculations don't even figure the value of my real estate or other accounts by that time, which would also be considerable (I hope). The major point is that I can do it. And if I can, at my income level, so can a lot of other people. It's just not fun or easy, and it requires working the problem from both ends (spend less, make more when you're presented with a choice for either). It requires making a budget and sticking to it. And investing money properly as you mentioned.
Joe in PNG
09-27-2021, 11:55 PM
To jump on Welder's post, there's more to income management than just avoiding the temptation to blow all your cash on frivolities. There's investing, retirement investing, avoiding scams, learning how to actually buy thing (a surprisingly rare skill), time management, and knowing what you are actually worth.
However, blowing all your cash in frivolities is to finances what uncontrolled arterial bleeding is to medicine. Stop that first, then worry about the other stuff.
Welder
09-28-2021, 12:02 AM
To jump on Welder's post, there's more to income management than just avoiding the temptation to blow all your cash on frivolities. There's ..<snip>... knowing what you are actually worth.
And if you're worth less than what you're being paid, there's knowing how to keep your own counsel. :p
BehindBlueI's
09-28-2021, 06:40 AM
That is only part of labor. The cost of the food sold in the grocery store is a large percentage, and if food producers are also increasing wages, that will drive up costs.
Labor costs for food items varies radically, but the people doing the labor almost universally make up a very small percent of the cost. It's been much too long since I did the reading/research on this to remember specifics but farms and farm workers are getting something like 20% of the profits. You could double the wages of the guy actually picking and the farmer's cut and it would be very minimal increase down the chain for most food items. Distributors and transportation costs are the lions share. You certainly see that in Alaska. The production didn't cost any more, the harvesting didn't cost any more, but your prices are higher because it's harder to get a ripe apple to you in February.
In short, fuel prices often matter more than wages for commodity food items.
If you were to increase the wages of the vast majority of average people, they'd wind up in even more debt.
Definitely true, but also a separate issue. I was certain stupid with money until I started having some, though.
WobblyPossum
09-28-2021, 07:45 AM
How common are investments that generate 7% interest? My next pay raise will allow me o max out my TSP contributions so I’ll be looking for something else to invest extra money in. My Roth IRA hasn’t been as successful as I’d like.
BehindBlueI's
09-28-2021, 08:07 AM
How common are investments that generate 7% interest?
Long term? Pretty common with a simple index fund.
See: https://www.businessinsider.com/personal-finance/average-stock-market-return
To jump on Welder's post, there's more to income management than just avoiding the temptation to blow all your cash on frivolities. There's investing, retirement investing, avoiding scams, learning how to actually buy thing (a surprisingly rare skill), time management, and knowing what you are actually worth.
However, blowing all your cash in frivolities is to finances what uncontrolled arterial bleeding is to medicine. Stop that first, then worry about the other stuff.
That's entirely my point.
Being thrifty doesn't mean a person knows how to manage money. Many poor people with no financial planning for retirement and no idea of how to benefit from passive growth are very thrifty. Thus, you can't say they really know anything about how to manage money; they're just stingy, or thrifty, which is a character trait that isn't synonymous with financial literacy.
WobblyPossum
09-28-2021, 08:12 AM
Long term? Pretty common with a simple index fund.
See: https://www.businessinsider.com/personal-finance/average-stock-market-return
Thanks. I’ll give that a read.
Borderland
09-28-2021, 09:27 AM
How common are investments that generate 7% interest? My next pay raise will allow me o max out my TSP contributions so I’ll be looking for something else to invest extra money in. My Roth IRA hasn’t been as successful as I’d like.
I've been in this one a long time. Not sure if it's open to the unwashed masses but we've been living off of the distributions for awhile now. Clicks along at about 11% return without too much drama. I was able to invest through deferred compensation retirement plan where I worked.
https://finance.yahoo.com/quote/FPURX?p=FPURX
Borderland
09-28-2021, 10:00 AM
I’ve been following some of the current housing market too, though I’m sure there are people more knowledgeable than me. One contributing factor is that investment firms are using their clout to buy fairly large number of homes in areas with growing economies.
This article is from Slate, but is fairly even handed and matches what I’ve seen from other sources.
https://www.google.com/amp/s/slate.com/business/2021/06/blackrock-invitation-houses-investment-firms-real-estate.amp
I've seen this here. I talked to a realtor awhile back that did some research for me on a house that sold in Bellingham WA. about a month ago. The house was listed at about 575K which is about average in that area. It sold in 5 days with 4 offers. Three were cash no contingency and two were at least 5% over the asking price. One offer was a contingency on loan approval for the listed price. The realtor said that was typical of how sales were going in the area.
That cuts out the average person who needs a bank loan to buy an average house around here. Hedge funds are buying these houses and will turn them into rental investment property.
Crow Hunter
09-28-2021, 10:13 AM
Again, I am a victim of my own experiences, but I will share what I am seeing "on the ground" in my area.
My wife is the head honcho in HR for a local company so I am exposed to this on a daily basis. :) The company she works for is a heavy industry manufacturing company. The company only requires that you can read and write and that you have not been convicted of a violent felony in the last 7 years and that you are drug free. You do not even need a high school diploma to work there.
The lowest paying job at the plant make $48,000 per year BEFORE overtime. (And there are always opportunities for OT) The more skilled jobs make significantly more. The company has a fully funded pension that will pay you 1% of the average of your highest 5 years of pay for every year you have worked there, indexed for inflation when you retire. It also has a 401k plan with a 6% match on top of the pension. The healthcare is amazing for the PPO plan ($250 Ded, $1,500 max out of pocket) and they also offer a high deductible HSA plan if you prefer. The cost for these plans are less than the cost to me for my HSA plan where I work. My wife truly cares for the employees and works 10-12 hours a day, 6 days a week plus working at home on her computer to try and make things even better for them.
For reference, the local county census data says that the median income for a household is $33,000k, for a family $40,000k and per capita $16,000k with a median home sale price of $100k for 2021. The MIT living wage calculator for the county says a "living wage" would be $24,440 for a single person.
So a person doing the simplest job in the plant, as a single person, makes 15% over what a family makes in the rest of the county and 2X the "living wage". So by most measures, pretty decent job for someone that may have never graduated high school and might even have a felony on their record?
Can't find people to work. Those that do, come in, can't pass the drug test. Those that do pass the drug test, might work for a month or two and then quit. Not go to another job for higher pay or better hours, just quit.
A little more than 10 years ago, I was inundated by requests for "help my XXXXX" get a job at her company because it was one of the few in the area that weren't laying people off. Now, crickets....
What has changed?
The population of the county and surrounding counties haven't significantly dropped. No major manufacturers have opened up facilities that didn't exist in '08-'11.
So some type of an external factor is involved, what? I have no idea.
We certainly live in interesting times, indeed.
Duces Tecum
09-28-2021, 10:31 AM
Long term? Pretty common with a simple index fund.
PortfolioCharts.com is focused entirely on index funds.
Welder
09-28-2021, 01:53 PM
That's entirely my point.
Being thrifty doesn't mean a person knows how to manage money. Many poor people with no financial planning for retirement and no idea of how to benefit from passive growth are very thrifty. Thus, you can't say they really know anything about how to manage money; they're just stingy, or thrifty, which is a character trait that isn't synonymous with financial literacy.
I don't think anyone believes that thriftiness = financial literacy. But my original post was in reply to Joe's point about people increasing debt in step with increases in income rather than applying some of that increase to their current debt load. I wasn't addressing financial literacy, I was talking about the financial 'arterial bleeding' (Joe's term in a later post) that many of us and / or our friends are all too familiar with. The reason I bolded it is because I've seen it happen in my own life and have to consciously fight it. I thought it was a good point and needed to be emphasized.
Of course I agree with and am familiar with the need to properly invest and plan for retirement. It's hard to do those things without getting spending under control first, though, so first things first. As such, living within your means and delaying gratification when necessary is a portion of proper money management. Your means =/= my means, so living within your means is obviously situationally specific. For some people, it means being happy with 3 houses instead of buying a fourth. For others it means only eating out once a month. Whatever. The concept is the same; the scale is different.
Welder
09-28-2021, 02:02 PM
And in reply to another post, yes, 7% interest is a perfectly attainable goal. The value of the dollar decreases over time (time value of money), so you need to earn a certain percentage....say, 3% for example, just to hold the present value of your money. The first 3%, then, is really just to conserve your wealth rather than watch it erode. This is why bank savings accounts and CD's are not really doing a person any favors. I'm a little rusty and my Econ degree is 22 years out of date, but this is pretty basic and I doubt anything has changed since then with this concept.
If you want to play around with what you can do with an initial chunk of change and certain monthly / annual additions and some time, you can use something like the compound interest calculator that I found on Nerdwallet. You'll have to search for it yourself; I'm no good at linking stuff.
I heartily agree with the suggestions of index funds. In years past, Vanguard and T Rowe Price had good low-load funds. There are probably others these days.
peterb
09-28-2021, 02:48 PM
Of course I agree with and am familiar with the need to properly invest and plan for retirement. It's hard to do those things without getting spending under control first, though, so first things first. As such, living within your means and delaying gratification when necessary is a portion of proper money management. Your means =/= my means, so living within your means is obviously situationally specific.
And there’s a balance to be found. I’ve seen people save diligently, always putting things they want to do on the “when we retire” or “maybe someday” list, and then have medical issues other other problems that put those plans out of reach.
The purpose of good money management is not to have the most money — it’s to have a good life.
Joe in PNG
09-28-2021, 03:17 PM
And a lot of people just don't know how to buy things.
Too many people think that thriftiness means buying cheap crap, which breaks or doesn't work, and then they have to buy it all over again. A $10 pair of shoes is no savings if you have to replace them every two months.
Borderland
09-28-2021, 06:02 PM
And there’s a balance to be found. I’ve seen people save diligently, always putting things they want to do on the “when we retire” or “maybe someday” list, and then have medical issues other other problems that put those plans out of reach.
The purpose of good money management is not to have the most money — it’s to have a good life.
Or just move to Alabama.
https://i.ibb.co/YPr1sJw/Good-life.jpg (https://imgbb.com/)
farscott
09-28-2021, 06:36 PM
Being "thrifty" has nothing to do with knowing how to manage money well. The chickens came home to roost when the economy changed and all these thrifty old people like my grandparents had nothing but CDs and savings accounts, which today isn't too much different than lighting your money on fire given the ROI vs inflation.
It was more than financial literacy working against people. It was expensive to invest. Forty years ago, the 401k was relatively new, and the stock market had high barriers to entry. Rich people invested in the stock and bond markets. Those barriers included high commissions, even higher commissions for not buying shares in multiples of 100, and pricing only to the nearest 1/8 of the USD. I remember paying more than $120 of commission to my broker to buy 100 shares of CSCO on a limit order in 1991. I also had to make a long-distance phone call to place the trade with said broker. I had to go home to watch CNBC to see where it closed which was better than it was when I had to wait until the next day for the closing prices to be printed in the newspaper.
The early 401k and direct stock purchase plans (DSPP) made the market accessible to more people, the move to decimal pricing helped, and the ubiquity of 401k/403b/IRA plans helped even more. Now purchase commissions are gone as brokers make money by letting the trades be front run. Government bonds are easy to purchase using treasurydirect.gov, and the minimum has dropped to multiples of $100 from multiples of $1000. It is a lot easier and less expensive to invest today than it was forty years ago.
Welder
09-28-2021, 09:25 PM
And a lot of people just don't know how to buy things.
Too many people think that thriftiness means buying cheap crap, which breaks or doesn't work, and then they have to buy it all over again. A $10 pair of shoes is no savings if you have to replace them every two months.
I, no crap, still have a pair of shoes I bought from Wal-Mart for $9.99 in the year 2000. They are slip-on "dress shoes" complete with those fugly fake cardboard tassles in the front. If you wear them on a motorcycle, the fake black leather glued to the top of the tassles separates in the wind and curls back, so now your tassles look like those add-on eyelashes that are all the rage these days.
They haven't left the property in many moons, and my gf says to expect to find them MIA one day.
LittleLebowski
09-28-2021, 09:32 PM
And a lot of people just don't know how to buy things.
Too many people think that thriftiness means buying cheap crap, which breaks or doesn't work, and then they have to buy it all over again. A $10 pair of shoes is no savings if you have to replace them every two months.
Buy cheap cry…
Joe in PNG
09-28-2021, 10:03 PM
I, no crap, still have a pair of shoes I bought from Wal-Mart for $9.99 in the year 2000. They are slip-on "dress shoes" complete with those fugly fake cardboard tassles in the front. If you wear them on a motorcycle, the fake black leather glued to the top of the tassles separates in the wind and curls back, so now your tassles look like those add-on eyelashes that are all the rage these days.
They haven't left the property in many moons, and my gf says to expect to find them MIA one day.
Better luck than me. I can flat destroy a cheap set of shoes in a few short weeks.
Crow Hunter
09-29-2021, 08:03 AM
It was more than financial literacy working against people. It was expensive to invest. Forty years ago, the 401k was relatively new, and the stock market had high barriers to entry. Rich people invested in the stock and bond markets. Those barriers included high commissions, even higher commissions for not buying shares in multiples of 100, and pricing only to the nearest 1/8 of the USD. I remember paying more than $120 of commission to my broker to buy 100 shares of CSCO on a limit order in 1991. I also had to make a long-distance phone call to place the trade with said broker. I had to go home to watch CNBC to see where it closed which was better than it was when I had to wait until the next day for the closing prices to be printed in the newspaper.
The early 401k and direct stock purchase plans (DSPP) made the market accessible to more people, the move to decimal pricing helped, and the ubiquity of 401k/403b/IRA plans helped even more. Now purchase commissions are gone as brokers make money by letting the trades be front run. Government bonds are easy to purchase using treasurydirect.gov, and the minimum has dropped to multiples of $100 from multiples of $1000. It is a lot easier and less expensive to invest today than it was forty years ago.
How many here know why this was done?
I remember it but never knew why until fairly recently.
Very interesting historical tidbit.
Crow Hunter
09-29-2021, 08:08 AM
It was more than financial literacy working against people. It was expensive to invest. Forty years ago, the 401k was relatively new, and the stock market had high barriers to entry. Rich people invested in the stock and bond markets. Those barriers included high commissions, even higher commissions for not buying shares in multiples of 100, and pricing only to the nearest 1/8 of the USD. I remember paying more than $120 of commission to my broker to buy 100 shares of CSCO on a limit order in 1991. I also had to make a long-distance phone call to place the trade with said broker. I had to go home to watch CNBC to see where it closed which was better than it was when I had to wait until the next day for the closing prices to be printed in the newspaper.
The early 401k and direct stock purchase plans (DSPP) made the market accessible to more people, the move to decimal pricing helped, and the ubiquity of 401k/403b/IRA plans helped even more. Now purchase commissions are gone as brokers make money by letting the trades be front run. Government bonds are easy to purchase using treasurydirect.gov, and the minimum has dropped to multiples of $100 from multiples of $1000. It is a lot easier and less expensive to invest today than it was forty years ago.
Not my fault. Server timeout. :)
beenalongtime
09-29-2021, 08:53 AM
Better luck than me. I can flat destroy a cheap set of shoes in a few short weeks.
However, expensive, doesn't mean good.
My shoes, used to be from Payless, and I was getting somewhere between six months, to a year, for around $30. (depending on if they were my ONLY shoes, or just work shoes) I once bought Red Wings that were $130 and they lasted 2 days of my normal use.
Quality and price, don't always go hand in hand.
hufnagel
09-29-2021, 11:49 AM
Buddies Son just got a delivery job. His first day on the job he got in a wreck. Then later the same day he ran the truck off the road and it took a wrecker to get the truck back on the road. He decided this wasnt for him and when he got back to the terminal he told them he couldnt do this job and he quit. The next day they called him to offer $300 bonus if he would come back. He said no. The second day they called and offered the bonus plus .75cents per hour. This continued over 5 days with better offers each day.
Recentl a Fed Ex guy made a delivery in a Penske truck across the street from me. I was out front and talked with him a bit. He said he was a regional manager and they couldnt hire enough people to do the work.
I cant help wondering if people are still flush from the increase of pay from covid unemployment and dont feel a pressing need to go back to work yet.
yo um, who was the company your bud's son was working for? and are they offering pay like that for peeps in NJ? I can pretty much fucking drive anything with wheels, just need to get an actual CDL at some point, maybe. I'd be willing to side hustle for some good cash. #ProfessionalWhore (https://pistol-forum.com/usertag.php?do=list&action=hash&hash=ProfessionalWhore)
yo um, who was the company your bud's son was working for? and are they offering pay like that for peeps in NJ? I can pretty much fucking drive anything with wheels, just need to get an actual CDL at some point, maybe. I'd be willing to side hustle for some good cash. #ProfessionalWhore (https://pistol-forum.com/usertag.php?do=list&action=hash&hash=ProfessionalWhore)
Fed Ex. No CDL required for trucks with no airbrakes.
OlongJohnson
09-29-2021, 01:13 PM
Quality and price, don't always go hand in hand.
You don't always get what you pay for, but you do always pay for what you get.
farscott
09-29-2021, 01:19 PM
How many here know why this was done?
I remember it but never knew why until fairly recently.
Very interesting historical tidbit.
The official reason was it copied the Spanish standard of the smallest fraction of a coin being one-eighth of a doubloon. My personal belief is it guaranteed a spread to allow the market maker to profit from any trade in that stock. That was key as stocks could not trade without a highly liquid market maker who could handle an imbalance of buy/sell orders.
Joe in PNG
09-29-2021, 03:26 PM
However, expensive, doesn't mean good.
My shoes, used to be from Payless, and I was getting somewhere between six months, to a year, for around $30. (depending on if they were my ONLY shoes, or just work shoes) I once bought Red Wings that were $130 and they lasted 2 days of my normal use.
Quality and price, don't always go hand in hand.
Ayup, that's the flip side of learning to buy stuff. Lots of brands have grasped that a lot of people think that expensive & exclusive = high quality, especially for older brand names with a good reputation. But we'll not discuss Sig, Kimber, and Gibson at this time.
And because they're expensive and exclusive, they draw legions of fanbois who's worth is tied into their purchase of that brand.
hufnagel
09-29-2021, 03:48 PM
Fed Ex. No CDL required for trucks with no airbrakes.
Thx. Might have to make a call soon.
Interesting from WSJ today:
77762
luckyman
09-29-2021, 04:29 PM
Interesting from WSJ today:
77762
Nice find! That’s the data I think a lot of us were interested in, the hard-fudge or explain away number in prime working ages…
Curious as to where that 2% went….dual income families going down to a single income, and post-college kids mooching off their parents are 2 possibilities, but who knows?
Wonder if the latest trend of ‘Shipping District’ communities springing up and commercial spaces built out of shipping containers is a factor in any of the log-train shortages.
77867
Here is a doozie from a Fed Reserve gov that I saw in the WSJ today. He might want to leave his office and look around.
77868
Caballoflaco
10-01-2021, 09:13 PM
I work in landscaping/maintenance, we do mostly commercial stuff but I’ve got one truck/crew that runs a residential route.
This week a dude randomly stopped me and tried to give our company some of his residential accounts in the wealthiest city in the state due to his inability to find workers. I had to decline because we recently had to sub out a couple of smaller accounts due to labor shortages.
I would never could have imagined that a few years ago.
OlongJohnson
10-01-2021, 09:29 PM
Wonder if the latest trend of ‘Shipping District’ communities springing up and commercial spaces built out of shipping containers is a factor in any of the log-train shortages.
I was thinking the opposite. We have all these shipping containers here and nobody wants to take them back.
[Interjecting, it just occurred to me: Getting the containers back onto a ship to go back to China and get reloaded requires the ship to sit at the dock, when that ship could get out of the way and let another ship come in to get unloaded. So that may be part of what's driving the container shortage. I don't know this, I literally just made it up.]
So if we have a lot more of something than there's demand for, the price should go down. So this would in theory be a fantastic time to acquire a handful of shipping containers, if you were interested in doing so, for whatever purpose you might have for them. But you'd need to find someone to load them on a truck and bring them to you, which could be difficult, because all the people who are willing and able to do that are probably getting paid a lot to move containers that are full of goods to be sold.
Or maybe it's a strategy to get a lot of steel into the U.S. without paying tariffs on it directly. Are they getting recycled at steel mills?
Welder
10-01-2021, 10:19 PM
I was thinking the opposite. We have all these shipping containers here and nobody wants to take them back.
[Interjecting, it just occurred to me: Getting the containers back onto a ship to go back to China and get reloaded requires the ship to sit at the dock, when that ship could get out of the way and let another ship come in to get unloaded. So that may be part of what's driving the container shortage. I don't know this, I literally just made it up.]
So if we have a lot more of something than there's demand for, the price should go down. So this would in theory be a fantastic time to acquire a handful of shipping containers, if you were interested in doing so, for whatever purpose you might have for them. But you'd need to find someone to load them on a truck and bring them to you, which could be difficult, because all the people who are willing and able to do that are probably getting paid a lot to move containers that are full of goods to be sold.
Or maybe it's a strategy to get a lot of steel into the U.S. without paying tariffs on it directly. Are they getting recycled at steel mills?
Seacans that are past their useful sea life are often sold used to the people wanting them for cheap storage buildings, etc. Their doors might be sprung, the floor might be soft, the locking lugs might be shot, etc. There's a guy I used to know down at one of the ports in our state who had a business doing nothing but repairing them for re-use, and another couple places I know selling them used. I've done enough work on them to know I'd rather work on trash dumpsters.
A container would have to be REALLY shot for it to go to a shredder. Like totalled on the interstate shot. It's value as scrap isn't much; they're not that heavy comparatively speaking and steel is a relatively low-dollar scrap material. The nonferrous materials are where the money is.
I have a customer who runs a metal shredder; I was the one who erected it and I work there at least a portion of nearly every week. Right now we're working on getting the nonferrous metals separation plants going. Anyhow, this customer can't get seacans for shipping his nonferrous stuff out. He's probably got over $1M worth of shredded aluminum sitting on the ground waiting for trucks and containers. If he could get containers ahead of time, he could load them ahead of time and have them waiting to be put on the trucks when they arrive...rather than the truck having to wait an hour or two to get loaded.
Some of the issue locally is getting trucks that are qualified to actually go into the ports themselves. Those guys can pretty much name their price.
OlongJohnson
10-01-2021, 10:28 PM
I don't know all the details, but I do recall Long Beach being pretty proud of the pollution controls on trucks that went into the port. Even working on getting an electric fleet in place.
Always seemed a little silly to me, because any time you'd drive past a certain spot on I-710 south toward the harbor, if the wind was from the west, you'd smell natural gas pretty strongly. For dang near a decade. Never got fixed.
Kind of a small version of, "Let's all fix global warming" instead of controlling smaller environmental problems that actually can be addressed effectively.
[Interjecting, it just occurred to me: Getting the containers back onto a ship to go back to China and get reloaded requires the ship to sit at the dock, when that ship could get out of the way and let another ship come in to get unloaded. So that may be part of what's driving the container shortage. I don't know this, I literally just made it up.]
I recall hearing last year of someone realizing this was going to happen and tried to pay shipping companies to take empties back but they didn’t go for it for the reason you stated.I assume at some point it makes sense to take some back and has normalized somewhat but I’m sure it would add to the bottleneck and also add to shipping costs.
Joe in PNG
10-02-2021, 12:39 AM
Which is interesting, as the shipping companies are very, very adamant about getting their empty containers back before your 'free time' runs out. I got one email return reminder for a container that hadn't even cleared customs yet!
Every time I get a container, I have to pay for a container bond, and don't get that money back until I send them the EIR, and pay for any overage for extra days out.
And yes, a lot of the containers used for construction are past being able to be certified for international shipping. I can get non-shippable containers all day, but the certified ones are kind of scarce at the moment.
I was thinking the opposite. We have all these shipping containers here and nobody wants to take them back.
So if we have a lot more of something than there's demand for, the price should go down. So this would in theory be a fantastic time to acquire a handful of shipping containers, if you were interested in doing so, for whatever purpose you might have for them. But you'd need to find someone to load them on a truck and bring them to you, which could be difficult, because all the people who are willing and able to do that are probably getting paid a lot to move containers that are full of goods to be sold.
Or maybe it's a strategy to get a lot of steel into the U.S. without paying tariffs on it directly. Are they getting recycled at steel mills?
That’s what was driving my assertion…I’ve been trying to get a couple and the prices are about 7X what I was expecting (just said that number because of the post title and to get my point across)!
But that may be because they are all being snapped up by the building of said communities. Also I would expect the container would have to be in pretty good shape to be used for construction. And I’ve seen them use some pretty rough stuff used for shipping….🤷
https://www.wsj.com/articles/a-war-for-talent-11633623631?mod=hp_opin_pos_2#cxrecs_s
Snippet:
Amazing as it may sound, the American worker shortage is getting even worse. For the second consecutive month, the number of small businesses reporting they could not find workers to fill open positions set a new record high. Given this historically tight labor market, it’s no surprise that the number of small firms raising compensation also hit a record high. That’s according to the latest monthly employment survey from the National Federation of Independent Business, due out later today.
“Fifty-one percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, up 1 point from August and a record high reading for the second consecutive month. The number of unfilled job openings far exceeds the 48-year historical average of 22 percent,” reports NFIB Chief Economist William Dunkelberg.
Caballoflaco
10-07-2021, 05:11 PM
https://www.wsj.com/articles/a-war-for-talent-11633623631?mod=hp_opin_pos_2#cxrecs_s
Snippet:
Amazing as it may sound, the American worker shortage is getting even worse. For the second consecutive month, the number of small businesses reporting they could not find workers to fill open positions set a new record high. Given this historically tight labor market, it’s no surprise that the number of small firms raising compensation also hit a record high. That’s according to the latest monthly employment survey from the National Federation of Independent Business, due out later today.
“Fifty-one percent (seasonally adjusted) of all owners reported job openings they could not fill in the current period, up 1 point from August and a record high reading for the second consecutive month. The number of unfilled job openings far exceeds the 48-year historical average of 22 percent,” reports NFIB Chief Economist William Dunkelberg.
Not only that, but people who would have been gone a long time ago are now “good workers” because they anly call out once or twice every two to three weeks.
On the plus side, my guys who are always here and work hard are getting bonuses on the regular for having to put up with all the slacker bullshit, and the overall quality of our work hasn’t suffered too much.
https://www.wsj.com/articles/september-jobs-report-unemployment-rate-2021-11633641477
Snippet:
U.S. job growth fell to the slowest pace of the year in September, as the Delta variant and a persistent shortage of workers restrained the ability of companies to hire.
The economy created 194,000 jobs in September, the smallest gain since December 2020 and down from 366,000 jobs added in August, the Labor Department said Friday.
Many workers gave up a job search and exited the labor force last month. The smaller pool of labor meant that despite the slowdown in hiring, the unemployment rate fell to 4.8% last month from 5.2% in August.
“This was the time when a lot of people were expecting labor shortages to be getting better but in fact they’re getting worse,” said Michael Pearce, senior U.S. economist at Capital Economics. “It’s a pretty worrying situation.”
farscott
10-08-2021, 03:45 PM
https://www.wsj.com/articles/september-jobs-report-unemployment-rate-2021-11633641477
Snippet:
U.S. job growth fell to the slowest pace of the year in September, as the Delta variant and a persistent shortage of workers restrained the ability of companies to hire.
The economy created 194,000 jobs in September, the smallest gain since December 2020 and down from 366,000 jobs added in August, the Labor Department said Friday.
Many workers gave up a job search and exited the labor force last month. The smaller pool of labor meant that despite the slowdown in hiring, the unemployment rate fell to 4.8% last month from 5.2% in August.
“This was the time when a lot of people were expecting labor shortages to be getting better but in fact they’re getting worse,” said Michael Pearce, senior U.S. economist at Capital Economics. “It’s a pretty worrying situation.”
I have a feeling that a lot of people who have left the workforce will be back sooner rather than later. There is a lot of money flying around right now; that will slow down as rates rise and the liquidity disappears. When it does, more people will need to work and hard times will be upon us.
Supply chain issues including transportation:
https://www.wsj.com/articles/supply-chain-issues-car-chip-shortage-covid-manufacturing-global-economy-11633713877?mod=mhp
Tabasco
10-08-2021, 08:44 PM
Which is interesting, as the shipping companies are very, very adamant about getting their empty containers back before your 'free time' runs out. I got one email return reminder for a container that hadn't even cleared customs yet!
Every time I get a container, I have to pay for a container bond, and don't get that money back until I send them the EIR, and pay for any overage for extra days out.
And yes, a lot of the containers used for construction are past being able to be certified for international shipping. I can get non-shippable containers all day, but the certified ones are kind of scarce at the moment.
Do you get your container via a shipping company, or a container leasing company? Just curious, as I used to work for a container leasing company.
Joe in PNG
10-08-2021, 09:39 PM
Do you get your container via a shipping company, or a container leasing company? Just curious, as I used to work for a container leasing company.
They're usually provided by the shipper- either CMA/CMG or Maersk.
.
Kind of a small version of, "Let's all fix global warming" instead of controlling smaller environmental problems that actually can be addressed effectively.
żPorque no los dos?
I’m not a tree hugger by any stretch but diesel sucks for short haul. Get the nukes fired back up and let’s spark it, baby.
WSJ’s take — a number of factors including government and employer vaccine mandates:
https://www.wsj.com/articles/where-did-all-the-workers-go-labor-shortage-biden-administration-11633725434
Navin Johnson
10-09-2021, 10:55 AM
I was thinking the opposite. We have all these shipping containers here and nobody wants to take them back.
[Interjecting, it just occurred to me: Getting the containers back onto a ship to go back to China and get reloaded requires the ship to sit at the dock, when that ship could get out of the way and let another ship come in to get unloaded. So that may be part of what's driving the container shortage. I don't know this, I literally just made it up.]
So if we have a lot more of something than there's demand for, the price should go down. So this would in theory be a fantastic time to acquire a handful of shipping containers, if you were interested in doing so, for whatever purpose you might have for them. But you'd need to find someone to load them on a truck and bring them to you, which could be difficult, because all the people who are willing and able to do that are probably getting paid a lot to move containers that are full of goods to be sold.
Or maybe it's a strategy to get a lot of steel into the U.S. without paying tariffs on it directly. Are they getting recycled at steel mills?
We are importing way more than exporting. Containers cost as much empty or full to ship.
IDK if intentional or not but stuff is floating in harbors for weeks to get off loaded because the yards are out of room. No over road shipping available. Makes one wonder.....
farscott
10-09-2021, 11:43 AM
The shortage of CDL drivers is real. My FIL is retired from Penske. He started as a driver and ended up in the office. He gets pinged weekly about returning to driving, and he is 72. I am not even sure he can pass a DOT physical, considering he has diabetes, had cataract surgery this year, and is 72.
Borderland
10-09-2021, 02:51 PM
Maersk says
https://www.maersk.com/news/articles/2021/09/23/asia-pacific-market-update-september
The shortage of CDL drivers is real. My FIL is retired from Penske. He started as a driver and ended up in the office. He gets pinged weekly about returning to driving, and he is 72. I am not even sure he can pass a DOT physical, considering he has diabetes, had cataract surgery this year, and is 72.
I have generally considered 18 wheeler drivers to be Pro's, but lately I have seen a lot of crappy driving, suggesting the driver pool has expanded to include drivers who previously wouldn't have been driving. Saw this on I10 on Tuesday night.
78267
I have read many theories on why so many people have not rejoined the work force. The WaPo will tell you it is because workers are under compensated or treated poorly. Hannity will tell you it is because of enhanced unemployment. The WSJ said yesterday, vaccine mandates have been an issue. I think the "truth" will turn out that it is multi factorial, and complicated. The most interesting question for me isn't why people aren't working but whether they will work again in the future.
Navin Johnson
10-09-2021, 04:49 PM
The lack of drivers is also hurting the auto industry as it is taking longer for product to arrive. Some of the auto manufactures saw this coming and paid the drivers during covid to keep them from seeking new employment.
Borderland
10-09-2021, 05:10 PM
I have read many theories on why so many people have not rejoined the work force. The WaPo will tell you it is because workers are under compensated or treated poorly. Hannity will tell you it is because of enhanced unemployment. The WSJ said yesterday, vaccine mandates have been an issue. I think the "truth" will turn out that it is multi factorial, and complicated. The most interesting question for me isn't why people aren't working but whether they will work again in the future.
A friend of mine who is 62 retired early. He was vaccinated but the virus worried him. He won't go inside with the public unless he has to. He had a good retirement and didn't need the money.
I think a lot of boomers are calling it quits early and won't be back.
entropy
10-09-2021, 07:27 PM
...and the transportation party is just warming up...
https://www.zerohedge.com/political/southwest-pilots-union-sues-block-airlines-vaccination-mandate
https://www.wsj.com/articles/biggest-u-s-retailers-charter-private-cargo-ships-to-sail-around-port-delays-11633858380
Snippet:
Global supply-chain delays are so severe that some of the biggest U.S. retailers have resorted to an extreme—and expensive—tactic to try to stock shelves this holiday season: They are chartering their own cargo ships to import goods.
mmc45414
10-10-2021, 08:24 AM
https://www.wsj.com/articles/biggest-u-s-retailers-charter-private-cargo-ships-to-sail-around-port-delays-11633858380
Snippet:
They are chartering their own cargo ships to import goods.
And this will exacerbate the problem for the rest of us. But if Walmart has their own fleet of trucks why wouldn't they buy a ship or two?
Also in their case they could send company drivers to wait in line at the port. As I may have mentioned, we have started bringing in though NY because it eliminates the rail component on the way to Ohio. It takes longer on the ship, but then it goes on a truck and comes straight to us. It is also more predictable.
Sent from my SM-G892A using Tapatalk
And this will exacerbate the problem for the rest of us. But if Walmart has their own fleet of trucks why wouldn't they buy a ship or two?
Also in their case they could send company drivers to wait in line at the port. As I may have mentioned, we have started bringing in though NY because it eliminates the rail component on the way to Ohio. It takes longer on the ship, but then it goes on a truck and comes straight to us. It is also more predictable.
Sent from my SM-G892A using Tapatalk
Of course the Fed Reserve assures us there is no inflation, or if there is, it is only transitory.
blues
10-10-2021, 08:46 AM
Of course the Fed Reserve assures us there is no inflation, or if there is, it is only transitory.
There's not even a pretense of the truth. Out and out lies are completely acceptable.
Just keep distracting the public with more b.s. and they won't focus on anything for more than a few minutes...and will then move on to the next thing.
mmc45414
10-10-2021, 09:05 AM
Of course the Fed Reserve assures us there is no inflation, or if there is, it is only transitory.
Oh yeah, we already own it while it is on the ship that takes twice as long and costs damn near three times as much. But hey, we don't have to pay the 25% tariff until it gets to New York, so we got that going for us...
fly out
10-10-2021, 09:21 AM
There's not even a pretense of the truth. Out and out lies are completely acceptable.
Just keep distracting the public with more b.s. and they won't focus on anything for more than a few minutes...and will then move on to the next thing.
You don't have to tell the truth when the media will happily parrot your lies.
Navin Johnson
10-10-2021, 09:40 AM
This will not calm down at all till after Christmas (at least). Likely get worse till then.
blues
10-10-2021, 09:57 AM
You don't have to tell the truth when the media will happily parrot your lies.
I hope the administration will at least be sending us all festive Hunter Biden designed greeting cards during the holidays.
Looking forward to starting an annual tradition.
Duces Tecum
10-10-2021, 10:15 AM
https://www.wsj.com/articles/biggest-u-s-retailers-charter-private-cargo-ships-to-sail-around-port-delays-11633858380
Snippet:
Global supply-chain delays are so severe that some of the biggest U.S. retailers have resorted to an extreme—and expensive—tactic to try to stock shelves this holiday season: They are chartering their own cargo ships to import goods.
The answers are probably behind the paywall, but how would it happen that a privately chartered ship arrives in port and immediately advances to the front of the line? Secondly, how is it that chartering one's own ship would be more expensive, when unused cargo space could be sold on the market to eager buyers, especially if the ship is unloaded before those that have been waiting in line?
Nephrology
10-10-2021, 12:00 PM
Of course the Fed Reserve assures us there is no inflation, or if there is, it is only transitory.
It seems like they are growing increasingly hawkish, but they are in a tough spot as likely we will see a significant economic contraction if/when FOMC rate goes up. IIRC they are already rolling back QE but seems like the FOMC rate will be what is actually needed to curb inflation in any meaningful sense of the word.
peterb
10-10-2021, 12:14 PM
Of course the Fed Reserve assures us there is no inflation, or if there is, it is only transitory.
Really?
The last published monetary policy report says:
———-
Inflation. Consumer price inflation, as measured by the 12-month change in the PCE price index, moved up from 1.2 percent at the end of last year to 3.9 percent in May. The 12-month measure of inflation that excludes food and energy items (so-called core inflation) was 3.4 percent in May, up from 1.4 percent at the end of last year. Some of the strength in recent 12-month inflation readings reflects the comparison of current prices with prices that sank at the onset of the pandemic as households curtailed spending—a transitory result of "base effects." More lasting but likely still temporary upward pressure on inflation has come from prices for goods experiencing supply chain bottlenecks, such as motor vehicles and appliances. In addition, prices for some services, such as airfares and lodging, have moved up sharply in recent months toward more normal levels as demand has recovered. Both survey-based and market-based measures of longer-term inflation expectations have risen since the end of last year, largely reversing the downward drift in those measures in recent years, and are in a range that is broadly consistent with the FOMC's longer-run inflation objective.
https://www.federalreserve.gov/monetarypolicy/2021-07-mpr-summary.htm
fly out
10-10-2021, 01:15 PM
Really?
The last published monetary policy report says:
———-
Inflation. Consumer price inflation, as measured by the 12-month change in the PCE price index, moved up from 1.2 percent at the end of last year to 3.9 percent in May. The 12-month measure of inflation that excludes food and energy items (so-called core inflation) was 3.4 percent in May, up from 1.4 percent at the end of last year. Some of the strength in recent 12-month inflation readings reflects the comparison of current prices with prices that sank at the onset of the pandemic as households curtailed spending—a transitory result of "base effects." More lasting but likely still temporary upward pressure on inflation has come from prices for goods experiencing supply chain bottlenecks, such as motor vehicles and appliances. In addition, prices for some services, such as airfares and lodging, have moved up sharply in recent months toward more normal levels as demand has recovered. Both survey-based and market-based measures of longer-term inflation expectations have risen since the end of last year, largely reversing the downward drift in those measures in recent years, and are in a range that is broadly consistent with the FOMC's longer-run inflation objective.
https://www.federalreserve.gov/monetarypolicy/2021-07-mpr-summary.htm
Yes, really. And that's what they put in print to document their position; on the airwaves, it's generally "transitory", "expected" "likely to resolve by spring" etc. We're being told that there's nothing to see here.
Really?
The last published monetary policy report says:
———-
Inflation. Consumer price inflation, as measured by the 12-month change in the PCE price index, moved up from 1.2 percent at the end of last year to 3.9 percent in May. The 12-month measure of inflation that excludes food and energy items (so-called core inflation) was 3.4 percent in May, up from 1.4 percent at the end of last year. Some of the strength in recent 12-month inflation readings reflects the comparison of current prices with prices that sank at the onset of the pandemic as households curtailed spending—a transitory result of "base effects." More lasting but likely still temporary upward pressure on inflation has come from prices for goods experiencing supply chain bottlenecks, such as motor vehicles and appliances. In addition, prices for some services, such as airfares and lodging, have moved up sharply in recent months toward more normal levels as demand has recovered. Both survey-based and market-based measures of longer-term inflation expectations have risen since the end of last year, largely reversing the downward drift in those measures in recent years, and are in a range that is broadly consistent with the FOMC's longer-run inflation objective.
https://www.federalreserve.gov/monetarypolicy/2021-07-mpr-summary.htm
Read further in the same report you linked:
Interest rate policy. To continue to support the economic recovery, the FOMC has kept the target range for the federal funds rate near zero and has maintained the monthly pace of its asset purchases. The Committee expects it will be appropriate to maintain the current target range for the federal funds rate until labor market conditions have reached levels consistent with its assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed that rate for some time.
Do you think what we are seeing in inflation is is consistent with that? As troubling as inflation is the labor market, with the terrible September jobs numbers. I believe we are looking at inflation, poorer earnings due to skyrocketing costs, and a series of challenges that the Fed likely has run out of pills to solve.
Joe in PNG
10-10-2021, 06:03 PM
This is what happens when a person who has a decades long reputation as an idiot and a screwup gets the highest office- and is surrounded by people of similar or less competence.
Let's Go Brandon!!!
I believe we are looking at inflation, poorer earnings due to skyrocketing costs, and a series of challenges that the Fed likely has run out of pills to solve.
Which results in what, in your opinion?
I ask because a lot of commentary these days tends towards extremes. On one end, people say it's fine and on the other end I read endless stories about how we'll all be in breadlines by the 15th and we'll be using million dollar bills to buy a gallon of milk before the year is out.
So, what's your take?
Which results in what, in your opinion?
I ask because a lot of commentary these days tends towards extremes. On one end, people say it's fine and on the other end I read endless stories about how we'll all be in breadlines by the 15th and we'll be using million dollar bills to buy a gallon of milk before the year is out.
So, what's your take?
My view is that near zero interest rates have caused a lot of money to go into equities, that would normally be split with bonds. This is referred to as TINA, or “there is no alternative.” The government is doing everything they can to keep interest rates low because of the amount of debt the US has to fund. However, recent inflation is at a level we haven’t seen since Jimmy Carter. I believe the US economy is fundamentally sound, but assets like equities and real estate are at near bubble valuation levels. I believe the equity market is due for a significant correction (and real estate too) and interest rates will increase somewhat to reflect inflation. I just don’t know how big a correction, how high interest rates go, and when this will happen.
My view is that near zero interest rates have caused a lot of money to go into equities, that would normally be split with bonds. This is referred to as TINA, or “there is no alternative.” The government is doing everything they can to keep interest rates low because of the amount of debt the US has to fund. However, recent inflation is at a level we haven’t seen since Jimmy Carter. I believe the US economy is fundamentally sound, but assets like equities and real estate are at near bubble valuation levels. I believe the equity market is due for a significant correction (and real estate too) and interest rates will increase somewhat to reflect inflation. I just don’t know how big a correction, how high interest rates go, and when this will happen.
Or look at the front page of the WSJ’s online edition, and you can see there is the potential for bad all over the place.
78321
Something else in the mix that I hadn't considered before. I was listening to the radio today and a truck driver called in. He said that recently he had spent 4 days stuck at a distribution center, with them taking stuff off his truck as they needed it, presumably because of space. He's an owner/operator, and owns his trailer, so just dropping it and leaving wasn't an option. He also said he is paid by the mile, and he wasn't getting paid for that time either.
I can't imagine why people aren't beating down the trucking companies' doors to get THAT job.
And just like with containers, there's probably, or will be, a trailer shortage too.
(Daily Mail) (https://www.dailymail.co.uk/news/article-10080277/Fast-food-chain-Raising-Canes-Chicken-Fingers-send-HALF-corporates-workers-kitchens.html)
'It's all hands on deck': Fast food chain Raising Cane's Chicken Fingers will send HALF of its corporate workers into kitchens to work as fry cooks and cashiers as it struggles to hire staff
By Adam Manno For Dailymail.Com
11:02 EDT 11 Oct 2021 , updated 12:18 EDT 11 Oct 2021
- The Louisiana chicken joint is sending out 500 of its 750 corporate workers
- 250 will work as cooks and cashiers for one to two weeks while staying at hotels
- CEO AJ Kumaran cited low online applications and rising costs and wages
- The fast food chain has 600 locations across 31 states
- There are still 2 million more unemployed people than there were pre-pandemic
- In a September survey, 71 percent of restaurants said they were understaffed
(Daily Mail) (https://www.dailymail.co.uk/news/article-10079935/The-shortage-Shelves-bare-delays-deliveries-pharmacies-without-medication.html)
America's bare shelves: Walmart and Costco limit toilet paper sales while toy companies warn parents their kids' Christmas gifts won't arrive in time thanks to backlog at ports, rail yards and on the roads
By Jennifer Smith, Chief Reporter For Dailymail.Com
10:31 EDT 11 Oct 2021 , updated 16:46 EDT 11 Oct 2021
- Supply chain problems that have been tormenting retailers for months are showing up in America's stores
- Around the country, there are shortages of goods on shelves in Target, Costco, Home Depot and Sears
- The issues aren't specific to any one type of good and are down to problems with shipping and distribution
- Cargo ships off can't get into overworked ports to drop off goods and are hovering off the coast
- There is a global shortage in truck drivers which is stalling distribution of goods and railroads are also jammed
- The cost of shipping a single container from China to LA reached $20,000 last month - four times what it cost last October
- There are fears that some of the backed-up ships at the port in L.A. will not be emptied before Black Friday - the biggest retail day of the year and the start of the Christmas shopping season
- Some retailers are telling people to buy Christmas gifts now to ensure they arrive on time
- There is no immediate end in sight: Biden has launched a White House supply chain task force but businesses fear the problems will stretch on for months yet
- Federal Reserve Chairman Jerome Powell predicts the issues will last until next year - which will prolong inflation
WSJ this afternoon:
Concerns about the combination of inflation and slowing growth have dogged markets in recent weeks. Inflation has proved stickier than expected, brought on by supply-chain disruptions, labor shortages and surging energy prices.
Meanwhile, the pace of the post-pandemic recovery has slowed. Over the weekend, Goldman Sachs lowered its projections for U.S. growth in the fourth quarter of 2021 and next year, citing factors such as the impact of Covid-19 on consumer spending and a looming drop-off in government support for the economy.
“We’re seeing a stagflation trend, with growth expectations falling and inflation rising,” said Chris Senyek, chief investment strategist at Wolfe Research.
Investors are also looking ahead to the third-quarter earnings season, which kicks off this week. Corporate earnings could shed light on how price increases are affecting companies, while companies’ revenue and profit projections will show how optimistic executives are about growth and consumer spending.
DDTSGM
10-11-2021, 11:33 PM
Nothing new or earthshaking, but an interesting article:
https://www.nytimes.com/2021/10/11/business/supply-chain-crisis-savannah-port.html
On this afternoon, under a merciless sun, the port is on track to break its record for activity in a single day — more than 15,000 trucks coming and going. Still, the pressure builds. A tugboat escorts another ship to the dock — the MSC AGADIR, fresh from the Panama Canal — bearing more cargo that must be parked somewhere.
In recent weeks, the shutdown of a giant container terminal off the Chinese city of Ningbo has added to delays. Vietnam, a hub for the apparel industry, was locked down for several months in the face of a harrowing outbreak of Covid. Diminished cargo leaving Asia should provide respite to clogged ports in the United States, but Mr. Lynch dismisses that line. “Six or seven weeks later, the ships come in all at once,” Mr. Lynch said. “That doesn’t help.”
Early this year, as shipping prices spiked and containers became scarce, the trouble was widely viewed as the momentary result of pandemic lockdowns.......Once life reopened, global shipping was supposed to return to normal.
But half a year later, the congestion is worse, with nearly 13 percent of the world’s cargo shipping capacity tied up by delays, according to data compiled by Sea-Intelligence, an industry research firm in Denmark.
Paul D
10-12-2021, 12:20 AM
I wonder if they have cardiac techs and nurses on those cargo ships.
We cannot find enough people to staff our hospital. A lot of these folks become travelling nurses/techs who join companies who use them as hired guns in other states. One guy I know now makes $6500/week as traveler. No staff + No hospital beds = no revenue generating elective surgeries for the hospital.
I'm also starting to worry about medical supplies and drugs. When that hurricane hit Puerto Rico a couple of years ago, we couldn't get a certain device because it was all made in PR. That was a nuisance but a majority of generic drug makers are overseas. That kinda is concerning for me.
Caballoflaco
10-12-2021, 05:35 AM
Then there’s this.
Alabama school district warns of food shortages, asks for parent help after deliveries fail
https://www.al.com/news/2021/10/alabama-school-district-warns-of-food-shortages-asks-for-parent-help-after-deliveries-fail.html
Alexander City Schools has asked parents to start feeding their children breakfast at home or to send them to school with a snack because the district has not received food deliveries from their vendors.
“We have taken action to open accounts with other vendors in an attempt to diversify our supply options,” officials said in a Facebook post on Saturday. “This is a situation that is frustrating for you as a parent, and for us as well as our ability to feed our students is being greatly impacted.”
Alexander City had 2,870 students last school year, with 65% enrolled in free- and reduced-price meals, according to data from the Alabama State Department of Education.
Read more Ed Lab: How Alabama schools are battling food shortages with warehouses, long hours.
Alabama schools continue to face food shortages as the pandemic impacts the workforce needed to serve and deliver meals, as well as supplies of food and packaging materials. Every school district in the state is currently facing these shortages to varying degrees, according to the department of education.
There is a lot of noise out there, and while it is easy to be distracted by loud noises, the question is what will ultimately happen. Here is my problem with equity and real estate asset values. First, start with equity and real estate valuations pre Covid. Now consider how many people died, how much money we spent on direct Covid care, how much money in stimulus, how tangled supply chains have become, and what we have learned about China. All of that should, by my way of thinking, make valuations lower not higher.
farscott
10-12-2021, 08:47 AM
My view on real estate prices is essentially simplistic; the price is driven by the monthly mortgage payment, not the sticker price. The budget is monthly payment; not transaction price. With 30-year interest rates low at around 3%, the $1000 P&I mortgage principal is approximately $237,000. That same $1000 P&I mortgage payment on a 30-year mortgage at 6% is approximately $167,000. And 6% is historically a low rate. If the Fed gets serious about inflation, we might see rates closer to 8% than 6%.
When long-term interest rates increase, real estate prices will crater. When that happens, we will see people trapped in homes because the mortgage principal is greater than the value of the house as most any new buyer will only be able to borrow at the higher rates.
My view on real estate prices is essentially simplistic; the price is driven by the monthly mortgage payment, not the sticker price. The budget is monthly payment; not transaction price. With 30-year interest rates low at around 3%, the $1000 P&I mortgage principal is approximately $237,000. That same $1000 P&I mortgage payment on a 30-year mortgage at 6% is approximately $167,000. And 6% is historically a low rate. If the Fed gets serious about inflation, we might see rates closer to 8% than 6%.
When long-term interest rates increase, real estate prices will crater. When that happens, we will see people trapped in homes because the mortgage principal is greater than the value of the house as most any new buyer will only be able to borrow at the higher rates.
Wow, 6% is considered a historically low interest rate? Sheesh. I should really count my blessings; I just bought a place and my interest rate is 2.25%.
Or, rather than a blessing is this a curse? It's not like the mortgage has a provision for balloon payments, but am I as a low-information consumer with this low interest rate now causal to some macroeconomic problem that isn't readily apparent to me?
I recognize that I'm buying at what is likely the height of a bubble and if I try to sell in the next few years there's a good chance I will owe more on the mortgage than the house is worth, but I was okay with that since the alternative is renting where I'm just throwing the money away to begin with. Just a single year of renting would be equal to being underwater in the mortgage by $30k, the way I look at it, and thus better to buy now and at least get a low interest rate than only be able to afford "half the house" if I were to wait to buy until after interest rates spike.
peterb
10-12-2021, 10:38 AM
Wow, 6% is considered a historically low interest rate? Sheesh. I should really count my blessings; I just bought a place and my interest rate is 2.25%.
.
http://www.freddiemac.com/pmms/pmms30.html
farscott
10-12-2021, 11:18 AM
Wow, 6% is considered a historically low interest rate? Sheesh. I should really count my blessings; I just bought a place and my interest rate is 2.25%.
Or, rather than a blessing is this a curse? It's not like the mortgage has a provision for balloon payments, but am I as a low-information consumer with this low interest rate now causal to some macroeconomic problem that isn't readily apparent to me?
I recognize that I'm buying at what is likely the height of a bubble and if I try to sell in the next few years there's a good chance I will owe more on the mortgage than the house is worth, but I was okay with that since the alternative is renting where I'm just throwing the money away to begin with. Just a single year of renting would be equal to being underwater in the mortgage by $30k, the way I look at it, and thus better to buy now and at least get a low interest rate than only be able to afford "half the house" if I were to wait to buy until after interest rates spike.
Some of us have had mortgages with rates exceeding 15%. And not on subprime mortgages. 6% was a good rate until the early 2000s.
Being underwater on the mortgage is not necessarily bad -- until it is. That usually happens when one wants to or must move and cannot sell the house without making up the difference. If you plan on staying long enough for prices to recover or the mortgage to mature, there is no downside. And since housing prices are really tied to the monthly payment, one does not lose any money by buying when prices are high other than increased property taxes on the higher assessed value. I would say insurance as well except my experience is even when valuations drop, insurers do not lower rates whereas my property taxes actually decreased after the 2008 crash.
http://www.freddiemac.com/pmms/pmms30.html
Look at 1982!
Oldherkpilot
10-12-2021, 11:37 AM
Wow, 6% is considered a historically low interest rate? Sheesh. I should really count my blessings; I just bought a place and my interest rate is 2.25%.
Or, rather than a blessing is this a curse? It's not like the mortgage has a provision for balloon payments, but am I as a low-information consumer with this low interest rate now causal to some macroeconomic problem that isn't readily apparent to me?
I recognize that I'm buying at what is likely the height of a bubble and if I try to sell in the next few years there's a good chance I will owe more on the mortgage than the house is worth, but I was okay with that since the alternative is renting where I'm just throwing the money away to begin with. Just a single year of renting would be equal to being underwater in the mortgage by $30k, the way I look at it, and thus better to buy now and at least get a low interest rate than only be able to afford "half the house" if I were to wait to buy until after interest rates spike.
I haven't rented in 30 years, but I always try to remember that renting isn't always the waste of money some proclaim it to be. What sort of rents are you looking at to be the equivalent of $30 grand underwater? Its easy to forget the TI part of PITI. The real estate taxes, homeowner's insurance, repairs and upkeep can make the outlay on rent seem less wasteful in some circumstances.
My youngest son's girlfriend had her heart set on buying in Columbus, OH a few months back. The market there requires a large cash down payment as the houses were going for $20-30,000 over appraisal, so she couldn't get bank financing and had to postpone buying. I was pretty relieved, as i was worried about the bubble.
I'm not trying to change your mind, just pointing out another perspective. Good luck however you decide.
littlejerry
10-12-2021, 11:48 AM
Wow, 6% is considered a historically low interest rate? Sheesh. I should really count my blessings; I just bought a place and my interest rate is 2.25%.
Or, rather than a blessing is this a curse? It's not like the mortgage has a provision for balloon payments, but am I as a low-information consumer with this low interest rate now causal to some macroeconomic problem that isn't readily apparent to me?
I recognize that I'm buying at what is likely the height of a bubble and if I try to sell in the next few years there's a good chance I will owe more on the mortgage than the house is worth, but I was okay with that since the alternative is renting where I'm just throwing the money away to begin with. Just a single year of renting would be equal to being underwater in the mortgage by $30k, the way I look at it, and thus better to buy now and at least get a low interest rate than only be able to afford "half the house" if I were to wait to buy until after interest rates spike.
The real impact will be to new construction and new vehicles. Low interest rates have distorted the market and created artificial demand for expensive vehicles and homes relative to income levels. The auto industry will take a huge hit along with construction.
And yes, individuals who are over leveraged will find themselves in a tight spot. Of course bankruptcies will increase which will devalue all of those realistate investment funds.
It'll be a fun ride for sure. I suspect that just like with federal deficit spending they'll ride this out as long as they can so someone else has to deal with the mess
Borderland
10-12-2021, 11:50 AM
Some of us have had mortgages with rates exceeding 15%. And not on subprime mortgages. 6% was a good rate until the early 2000s.
Being underwater on the mortgage is not necessarily bad -- until it is. That usually happens when one wants to or must move and cannot sell the house without making up the difference. If you plan on staying long enough for prices to recover or the mortgage to mature, there is no downside. And since housing prices are really tied to the monthly payment, one does not lose any money by buying when prices are high other than increased property taxes on the higher assessed value. I would say insurance as well except my experience is even when valuations drop, insurers do not lower rates whereas my property taxes actually decreased after the 2008 crash.
That makes sense. I think one of the reasons residential real estate here has increased 25% in the last 2 years is because of low interest rates. People in lower income brackets can now afford to buy a house. That has a chilling effect on the market over time though because when those prices go up, a 3% loan on a house that was 500K in 2019 is a 3% loan on a house that is now 625K. Eventually those lower income folks get squeezed out of the market again one way or another. What happened here is a cash offer, without contingencies and 10% above the listed price is what it takes to buy a house. Sales basically turned into 7 day auctions and inventory was at a 40 year low.
That's also happened in the auto industry. New cars are being auctioned by a system of money down to have a chance to even buy a vehicle. Dealer sets his price way above MSRP and when you decline the offer he just goes to the next person in line that might be willing to pay the price. Basically a slow moving auction.
Tabasco
10-12-2021, 12:05 PM
"Editor’s note: We are sharing a useful insight from one of our subscribers on his experience with the supply chain problem. We thank him for allowing us to republish his concise explanation.
Longtime reader and last few years a subscriber. I operate an import and wholesale distribution business in the recording studio monitor segment of professional audio. I import from England. I can see this supply chain in very compact form as I import a specific range of products from one manufacturer that hand-makes nearly everything it ships.
The disruption began with labor as COVID-19 restrictions on factory operations sent many workers home. This led to longer lead times. Before this was resolved, another disruption occurred: a severe shortage of labor in customs and shipping. We read about our ports but we don’t read about our air freight, which is dependent on passenger airlines. Customs and shipping are invisible to the customer but are critical to supply chains. This issue has escalated to crisis levels in the last year and has extended the back order time significantly. Now a third disruption has occurred, a shortage of raw materials. Local sources of raw materials have escalated in price or dried up as environmental rules force raw material suppliers to clean up their act. Steel is a good example but there are many more. Now the small factory that only had a labor problem and the importer that only had a shipping problem emerge from COVID-19 only to find demand strong but no product to sell and as the factory now faces a lack of raw materials to replenish stores needed to fulfill orders. The importer faces a lack of shippable inventory to sell from the factory. All of this cascaded quietly as COVID-19 dragged on. The problems were initially isolated but now are widespread.
As governments cope with the politicization of everything, repaying the flood of money used to stabilize the economy, and the pressure for more significant medical and social services that emerged directly from COVID-19, they face their own disruption: escalate spending rapidly, and the taxes to support that spending, under the banner of social justice. To find new revenue, governments are squeezing businesses already facing cascading disruptions that threaten the very existence of the business. As prices escalate into runaway inflation, as we all become accustomed to living without the things we cannot get, we land at the doorstep of a major decline in demand.
If you can’t get it, what’s the point of wanting it? If you don’t want it, what’s the point of making it? This is a dangerous inflection point for the world."
RoyGBiv
10-12-2021, 12:42 PM
There is a lot of noise out there, and while it is easy to be distracted by loud noises, the question is what will ultimately happen. Here is my problem with equity and real estate asset values. First, start with equity and real estate valuations pre Covid. Now consider how many people died, how much money we spent on direct Covid care, how much money in stimulus, how tangled supply chains have become, and what we have learned about China. All of that should, by my way of thinking, make valuations lower not higher.
All of the NY apartment dwellers that can suddenly work remotely and can afford a 5000sf house in the Midwest for less than a SoHo studio. Same for Kalifornians. Now add in all the investment money going into real estate. I'll try to find the article I read about investment companies building entire neighborhoods of upscale single family homes, intending for the whole neighborhood to be rentals.
Now add in all of the supply chain increases, from material to shipping. Sure lumber is off its brief peak, but good luck finding a truck driver to deliver your load for the same price as it was pre pandemic. Uncle Sam pays pretty well, creating competition for labor.
Duces Tecum
10-12-2021, 12:46 PM
The answers are probably behind the paywall, but how would it happen that a privately chartered ship arrives in port and immediately advances to the front of the line? Secondly, how is it that chartering one's own ship would be more expensive, when unused cargo space could be sold on the market to eager buyers, especially if the ship is unloaded before those that have been waiting in line?
The rest of the story: Brietbart (no paywall) reports that large companies are chartering for their own use much smaller ships that can be unloaded at significantly smaller ports where the large cargo ships cannot be supported.
It now makes sense.
https://www.breitbart.com/politics/2021/10/12/home-depot-ships-supply-chain-crisis/
https://www.washingtonpost.com/business/2021/10/12/jolts-workers-quitting-august-pandemic/
A record number of workers are quitting their jobs, empowered by new leverage
4.3 million people quit their jobs in August, nearly 3 percent of the workforce.
Miami, FLORIDA — OCTOBER 08: A 'now hiring' sign outside of a business on October 08, 2021 in Miami, Florida. According to the Bureau of Labor Statistics in September job growth fell well short of expectations in September. The labor force shrank by 183,000 from August. (Joe Raedle/Getty Images)
Some 4.3 million people quit jobs in August — about 2.9 percent of the workforce, according to new data released Tuesday from the Department of Labor. Those numbers are up from the previous records set in April, of about 4 million people quitting, reflecting how the pandemic has continued to jolt workers’ mindsets about their jobs and their lives
Now add in all the investment money going into real estate. I'll try to find the article I read about investment companies building entire neighborhoods of upscale single family homes, intending for the whole neighborhood to be rentals.
BlackRock, right? Peep the second post on the first page of my news/commentary thread? Maybe one of those links is the article you're thinking of. If not I'd love to add it to the thread.
I haven't rented in 30 years, but I always try to remember that renting isn't always the waste of money some proclaim it to be. What sort of rents are you looking at to be the equivalent of $30 grand underwater? Its easy to forget the TI part of PITI. The real estate taxes, homeowner's insurance, repairs and upkeep can make the outlay on rent seem less wasteful in some circumstances.
My youngest son's girlfriend had her heart set on buying in Columbus, OH a few months back. The market there requires a large cash down payment as the houses were going for $20-30,000 over appraisal, so she couldn't get bank financing and had to postpone buying. I was pretty relieved, as i was worried about the bubble.
I'm not trying to change your mind, just pointing out another perspective. Good luck however you decide.
I live in the DC metro area in northern Virginia.
$2500 is an easy pricepoint to find yourself at for an apartment in this area if you want a covered parking and enough room for your guns, ammo, and camping gear. My monthly payments for the place I just bought falls into that category and even with HOA and taxes and insurance, works out to a hair under $2500/month.
So, $2500x12=$30k. If I rented for a year, I'd have wasted $30k that could have been spent on gaining equity in a house. A better example would've been 2 years, as I'll be here for a very bare minimum of 2 years with my current assignment before I'm eligible to go elsewhere if I so desire...that's $60k I'd be in the hole on rent, so even if I decided to sell it two years from now (an extremely unlikely possibility) and sold it for $30k less than I paid, I'm still about even or a little ahead with having bought even when you hit me with the accrued T&I and closing costs....and that's an extremely unlikely worst case scenario akin to willfully slamming my dick in a door. A realistic scenario given my life plans, even if the bubble pops, is I sell it 13 years from now for the same price I bought it for; I come out way ahead vs renting. Now compare it against maturation of the mortgage. 30 years at $2500=$900,000 I have nothing to show for if renting; do the math on who ends up ahead, and it's several Porsche 911 GT3 RS-worth in my favor as a buyer. None of the "but" points of view I've heard from numerous people change that.
farscott
10-12-2021, 05:01 PM
I live in the DC metro area in northern Virginia.
$2500 is an easy pricepoint to find yourself at for an apartment in this area if you want a covered parking and enough room for your guns, ammo, and camping gear. My monthly payments for the place I just bought falls into that category and even with HOA and taxes and insurance, works out to a hair under $2500/month.
So, $2500x12=$30k. If I rented for a year, I'd have wasted $30k that could have been spent on gaining equity in a house. A better example would've been 2 years, as I'll be here for a very bare minimum of 2 years with my current assignment before I'm eligible to go elsewhere if I so desire...that's $60k I'd be in the hole on rent, so even if I decided to sell it two years from now (an extremely unlikely possibility) and sold it for $30k less than I paid, I'm still about even or a little ahead with having bought even when you hit me with the accrued T&I and closing costs....and that's an extremely unlikely worst case scenario akin to willfully slamming my dick in a door. A realistic scenario given my life plans, even if the bubble pops, is I sell it 13 years from now for the same price I bought it for; I come out way ahead vs renting. Now compare it against maturation of the mortgage. 30 years at $2500=$900,000 I have nothing to show for if renting; do the math on who ends up ahead, and it's several Porsche 911 GT3 RS-worth in my favor as a buyer. None of the "but" points of view I've heard from numerous people change that.
I mostly agree. The only issue that comes up over longterm home ownership is maintenance costs. Things like a new roof, new windows, new HVAC, paint, yard work and equipment, etc. all increase the cost of home ownership. Even considering those costs, I find that home ownership is financially the smart move for me as it is less expensive than renting over a period of years.
RoyGBiv
10-12-2021, 05:18 PM
BlackRock, right? Peep the second post on the first page of my news/commentary thread? Maybe one of those links is the article you're thinking of. If not I'd love to add it to the thread.
Definitely the same Tucker story roots, but was on a different website than Am Thinker.... Same story though with Carlson video. Thanks!
I mostly agree. The only issue that comes up over longterm home ownership is maintenance costs. Things like a new roof, new windows, new HVAC, paint, yard work and equipment, etc. all increase the cost of home ownership. Even considering those costs, I find that home ownership is financially the smart move for me as it is less expensive than renting over a period of years.
right on *fist bump*
I'm in a townhouse-style condo, so a lot of that is taken care of through the monthly HOA fees or in extreme and infrequent situations, assessments shared by the community. The downside obviously being that resale isn't as profitable as a "real" townhouse or especially a single family home, but hey, even if I break even I'm happy compared to renting. I've also resigned myself to the fact that breaking even when it comes time to sell the place is the best I can hope for given I'm buying at what is likely the top of a bubble and end of a two-decade long booming expansion of the NCR, so if I end up making money on it at all then that's just icing on the cake.
I've had several people at work tell me they like to rent so they can invest more money which earns a higher return than real estate, and I don't think they understand that 1) You're still throwing away ~30% of your income that you'll see NO gain on at all, not to mention you won't even get it back at all, and 2) You're not investing more. As you pointed out, it's a game based what you can afford in a month....so if you're paying $2500 in rent, that doesn't mean you're investing more than if you were paying $2500 in a mortgage...quite literally you're investing more through buying since the property is an investment, and you still have the freedom to put the leftover discretionary income towards an ETF if you so choose just the same as if you were renting. The only difference is that similar to leasing a car, you have historically been able to get a "nicer" place by renting than buying given the same monthly limit, but I think that ends up being a matter of coming to terms with what is realistically within one's means rather than being a factor anyone should be making a decision on when deciding to rent vs buy.
peterb
10-12-2021, 05:43 PM
I mostly agree. The only issue that comes up over longterm home ownership is maintenance costs. Things like a new roof, new windows, new HVAC, paint, yard work and equipment, etc. all increase the cost of home ownership. Even considering those costs, I find that home ownership is financially the smart move for me as it is less expensive than renting over a period of years.
There’s also the issue of time. As a renter, my weekends were my own. No mowing, raking, shoveling, painting……. As a homeowner, there’s always a chore list. For now the pluses of ownership outweigh the minuses but sometimes I do miss the free time that came with renting.
I mostly agree. The only issue that comes up over longterm home ownership is maintenance costs. Things like a new roof, new windows, new HVAC, paint, yard work and equipment, etc. all increase the cost of home ownership. Even considering those costs, I find that home ownership is financially the smart move for me as it is less expensive than renting over a period of years.
I guess some of it may depend on your area and age of houses. I just replaced my roof last year. The previous was the original. $5400. New AC a few years ago $3000. Had a sewer pipe break back in 2016 $2200. Water heater in 2012 $300. That just under $11k and I've lived here since end of 06. Windows are less than 30 years old so they're fine.
There's been minor maintenance of other things but nothing expensive. New faucet x2, new pipe under the sink, new thermostat. All these are just minor things.
Just repainted the whole house last year because I was board. The original paint was from 07. I started in March and ended in Nov. Took my time and probably spent $500 overall. Each bucket was like $40 9 different rooms and some rooms needed 2 buckets + odds and ends like brushes, caulk, rollers.
Yard work is just a lawnmower. Paid $75ish back in 2007. It's the old fashioned type.....wheels spin the blades.
It's really not that big of a deal. If the house needs to be gutted down to the studs that's a different story
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I guess some of it may depend on your area and age of houses. I just replaced my roof last year. The previous was the original. $5400. New AC a few years ago $3000. Had a sewer pipe break back in 2016 $2200. Water heater in 2012 $300. That just under $11k and I've lived here since end of 06. Windows are less than 30 years old so they're fine.
There's been minor maintenance of other things but nothing expensive. New faucet x2, new pipe under the sink, new thermostat. All these are just minor things.
Just repainted the whole house last year because I was board. The original paint was from 07. I started in March and ended in Nov. Took my time and probably spent $500 overall. Each bucket was like $40 9 different rooms and some rooms needed 2 buckets + odds and ends like brushes, caulk, rollers.
Yard work is just a lawnmower. Paid $75ish back in 2007. It's the old fashioned type.....wheels spin the blades.
It's really not that big of a deal. If the house needs to be gutted down to the studs that's a different story
Sent from my moto z4 using Tapatalk
The average homeowner these days also isn't their own handyman, so you represent an extreme on the low cost end.
The average homeowner would have paid substantially more than you since they would need a professional to do the work.
The average homeowner these days also isn't their own handyman, so you represent an extreme on the low cost end.
The average homeowner would have paid substantially more than you since they would need a professional to do the work.I didn't do the roof or the sewer pipe or any of the big dollar repairs but paints, caulk, spackle and sand, change a faucet....common man.... people can't be that helpless? But then again why am I surprised anymore?!?!
Sent from my moto z4 using Tapatalk
I didn't do the roof or the sewer pipe or any of the big dollar repairs but paints, caulk, spackle and sand, change a faucet....common man.... people can't be that helpless? But then again why am I surprised anymore?!?!
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Me being a perfect example:
I've done all of that previously and I also learned some basic plumbing like soldering copper pipes, but that doesn't mean I want to do it, and I can afford to not do it.
I also know I can't do a given task as well as someone that performs said task everyday, so if I want it done right and done once, I'll pay someone to do it. I can spackle, sand, and paint a room, but it'll take me 4x as long as a handyman and not look as good in the end anyway. I'd personally rather pay him to do it and go drive my car or build a model airplane instead.
farscott
10-12-2021, 07:35 PM
I didn't do the roof or the sewer pipe or any of the big dollar repairs but paints, caulk, spackle and sand, change a faucet....common man.... people can't be that helpless? But then again why am I surprised anymore?!?!
As I get older, I do less. For example, I used to do a fair amount of plumbing, including sweating copper joints and replacing the entire toilet. Now I limit myself to replacing valve seats and springs in the faucets, replacing flexible waterlines, and adding a bidet seat to a toilet. The arthritis and poor eyesight make those tasks hard enough to let me know I need to leave the bigger jobs to the pros. Heck, I needed my wife to help me get the valve seats located in the kitchen faucet a few months ago because I could not see if they were properly seated onto the springs.
peterb
10-12-2021, 08:09 PM
I also know I can't do a given task as well as someone that performs said task everyday, so if I want it done right and done once, I'll pay someone to do it. I can spackle, sand, and paint a room, but it'll take me 4x as long as a handyman and not look as good in the end anyway. I'd personally rather pay him to do it and go drive my car or build a model airplane instead.
Our first house had manual garage doors. I was pricing openers, looking at installation instructions, and generally dreading the whole project. Then I got a quote on having it done that seemed remarkably reasonable.
We came home from work one day and had doors that opened at the push of a button. Amazing.
I bought myself a stress-free weekend. Absolutely worth it.
Oldherkpilot
10-12-2021, 09:55 PM
I live in the DC metro area in northern Virginia.
$2500 is an easy pricepoint to find yourself at for an apartment in this area if you want a covered parking and enough room for your guns, ammo, and camping gear. My monthly payments for the place I just bought falls into that category and even with HOA and taxes and insurance, works out to a hair under $2500/month.
So, $2500x12=$30k. If I rented for a year, I'd have wasted $30k that could have been spent on gaining equity in a house. A better example would've been 2 years, as I'll be here for a very bare minimum of 2 years with my current assignment before I'm eligible to go elsewhere if I so desire...that's $60k I'd be in the hole on rent, so even if I decided to sell it two years from now (an extremely unlikely possibility) and sold it for $30k less than I paid, I'm still about even or a little ahead with having bought even when you hit me with the accrued T&I and closing costs....and that's an extremely unlikely worst case scenario akin to willfully slamming my dick in a door. A realistic scenario given my life plans, even if the bubble pops, is I sell it 13 years from now for the same price I bought it for; I come out way ahead vs renting. Now compare it against maturation of the mortgage. 30 years at $2500=$900,000 I have nothing to show for if renting; do the math on who ends up ahead, and it's several Porsche 911 GT3 RS-worth in my favor as a buyer. None of the "but" points of view I've heard from numerous people change that.
You should probably take a look at the amortization table that your lender ought to have provided you. Of your just under $2500/ month mortgage payment, about $825 goes to the principal and the rest is wasted just like your rent. "Accrued T & I" must be a DC thing, I'm not familiar with that term.
You should probably take a look at the amortization table that your lender ought to have provided you. Of your just under $2500/ month mortgage payment, about $825 goes to the principal and the rest is wasted just like your rent. "Accrued T & I" must be a DC thing, I'm not familiar with that term.
T&I: taxes and insurance. You mentioned it first: PITI. TI in PITI. TI=T&I, same as P&I means principal and interest.
I'm not sure what your point is about amortization.....that's $825 at the very first payment....the amount applied towards principal increases, so it's disingenuous to imply that only $825 will be applied to principal for the life of my mortgage, as if for the life of my mortgage I'd be wasting $1,675 each month just like rent. And, even if that WERE the case, which it isn't, that'd still be $825 per month that is equity I'd get back in the end.
And, yes, there's interest paid on a loan, but at the end of 30 years (if I were to even let the loan go that far) I'll still be several hundred thousand dollars ahead than if I were to rent. Not to mention, once I pay off the mortgage I've got thousands of dollars in extra discretionary income per month at that point...I'd own my place outright.....whereas if I rented for 30 years, I'd still only be renting for the rest of my life.
That also isn't accounting for the fact that rent will rise over time, so that $900k at the end of 30 years for renting is actually an unrealistically low number and would be much higher, whereas not only will my mortgage not negatively amortize but I have the option of paying down the principal early, thus reducing the amount of interest I pay over the life of the mortgage (and no, I have no prepayment penalty).
I'm kind of baffled why you're trying to convince me that buying doesn't make financial sense.
Oldherkpilot
10-13-2021, 12:41 AM
T&I: taxes and insurance. You mentioned it first: PITI. TI in PITI. TI=T&I, same as P&I means principal and interest.
I'm not sure what your point is about amortization.....that's $825 at the very first payment....the amount applied towards principal increases, so it's disingenuous to imply that only $825 will be applied to principal for the life of my mortgage, as if for the life of my mortgage I'd be wasting $1,675 each month just like rent. And, even if that WERE the case, which it isn't, that'd still be $825 per month that is equity I'd get back in the end.
And, yes, there's interest paid on a loan, but at the end of 30 years (if I were to even let the loan go that far) I'll still be several hundred thousand dollars ahead than if I were to rent. Not to mention, once I pay off the mortgage I've got thousands of dollars in extra discretionary income per month at that point...I'd own my place outright.....whereas if I rented for 30 years, I'd still only be renting for the rest of my life.
That also isn't accounting for the fact that rent will rise over time, so that $900k at the end of 30 years for renting is actually an unrealistically low number and would be much higher, whereas not only will my mortgage not negatively amortize but I have the option of paying down the principal early, thus reducing the amount of interest I pay over the life of the mortgage (and no, I have no prepayment penalty).
I'm kind of baffled why you're trying to convince me that buying doesn't make financial sense.
I'm not trying to convince you of anything. Your math was fucked and I pointed it out so other readers can make an informed assessment about whether to buy a place at the top of a bubble market. 2008 an all. Carry on.
RoyGBiv
10-13-2021, 08:30 AM
Just received this unsolicited email. I get these randomly from companies looking to get my shipping business.
I was quoted $25,000 for this route back in September. "Normal" is about $3500 - $4500-ish (Shenzhen to LA) depending on season, etc.
Good morning, we are back from National holiday!
Then now from SHENZHEN to LA, the rate is only usd9200/40HQ, to New york: usd13200/40HQ, do you have any containers to be arranged in Oct. ?
peterb
10-13-2021, 09:29 AM
A different container price hike and supply shortage….
—————-
Here's another unexpected example of how supply chains have been upended by the pandemic: Glass bottles used for everything from vinegar to pasta sauces are getting tied up in their own bottlenecks. That's driving prices higher, when you can get the bottles at all.
Just like many other industries struggling to secure supplies, producers of pasta sauce and high-end spirits are seeing the glass used in their humble containers tied up in massive cargo jams, and that's forcing them to either absorb the higher costs or pass them on to consumers.
https://www.npr.org/2021/10/13/1045375361/consumer-prices-inflation-pasta-sauce-shortage-of-glass
In today’s article reporting a 5.4 percent increase in inflation in September, excluding energy prices. Also today, Social Security announced the largest increase in years. Here is what the Fed said:
Fed Vice Chairman Richard Clarida said Tuesday that the underlying rate of inflation in the U.S. economy is near the Fed’s 2% longer-run objective and, thus, that the recent surge will prove “largely transitory” once the supply bottlenecks clear. However, he said the Fed would raise rates if it saw evidence that households and businesses were beginning to expect higher inflation.
“Monetary policy would react to that,” Mr. Clarida said. “But that is not the case at present.”
78422
ST911
10-13-2021, 10:26 AM
If there's an excess of containers that can't get back, what's the best way to get a used a container for bottom dollar? I see websites with containers in various conditions for sale. What's the hack for even better deals?
Crow Hunter
10-13-2021, 10:28 AM
T&I: taxes and insurance. You mentioned it first: PITI. TI in PITI. TI=T&I, same as P&I means principal and interest.
I'm not sure what your point is about amortization.....that's $825 at the very first payment....the amount applied towards principal increases, so it's disingenuous to imply that only $825 will be applied to principal for the life of my mortgage, as if for the life of my mortgage I'd be wasting $1,675 each month just like rent. And, even if that WERE the case, which it isn't, that'd still be $825 per month that is equity I'd get back in the end.
And, yes, there's interest paid on a loan, but at the end of 30 years (if I were to even let the loan go that far) I'll still be several hundred thousand dollars ahead than if I were to rent. Not to mention, once I pay off the mortgage I've got thousands of dollars in extra discretionary income per month at that point...I'd own my place outright.....whereas if I rented for 30 years, I'd still only be renting for the rest of my life.
That also isn't accounting for the fact that rent will rise over time, so that $900k at the end of 30 years for renting is actually an unrealistically low number and would be much higher, whereas not only will my mortgage not negatively amortize but I have the option of paying down the principal early, thus reducing the amount of interest I pay over the life of the mortgage (and no, I have no prepayment penalty).
I'm kind of baffled why you're trying to convince me that buying doesn't make financial sense.
The only catch, and what I am sure he was demonstrating is what "almost" happened to me and just something to be aware of.
In May of 2001 I moved to Clarksville TN and bought a very nice house in a very nice new subdivision. I paid $150k for the house. ($232,466 in 2021 according to CPI data). Then 9/11 happened.
Not only did we have a serious economic crisis but being a military town, there were a lot of shakeups in people leaving/coming etc that seriously depressed the housing market (and had the potential to have been much worse). So the house that I purchased for $150k was suddenly worth significantly less, but my mortgage was still for $142k (5% down with PMI). So I was in a job that I hated, that was in jeopardy, with a house that I owed more for than I could sell it for. This was not even considering the 6% closing costs that I would have to pay to a realtor to sell it.
The first few years that I was making my payments, very little was going to the principal of the loan. Instead, I was paying exclusively interest.
In effect, I was "renting it" from the bank for the interest payments and wasn't building any equity at all and wouldn't for several years.
"Luckily" I was in the house/job for 7 years, which wound up being enough time for the market/economy to recover enough that when I sold, I did not have to take a haircut and luckily got out selling it for $185k minus my closing costs but I still owed the bank a significant amount of money because even at 7 years in to a 30 yr mortgage my payment was very biased towards interest over principal. A few months after selling the even bigger housing crash of 2008/09 happened. If I had waited just a few more months to sell, it is very likely I would have owed money when I sold the house after paying closing costs.
Over a long period of time, it definitely makes more sense to own than rent since you "earn" the imputed rent that you don't have to pay once you have your home paid for. But there is a point that the rent vs own intersects and normally, in the short term, you will be better of renting than owning. If you have a stable job and you plan on staying in the area/home long term, you absolutely should buy. If you job is unstable and you may be transferred or you may decide you don't want to live there in less time that it takes to make that intersection point, you could very well lose money, sometimes A LOT if we hit a major rough patch in the economy/area.
But you have to roll the die either way.;)
blues
10-13-2021, 10:35 AM
And to think, back in the 90's, the Colombian cartels and their confederates wouldn't even use the same container twice. It would end up in Barcelona, and after the dope was removed from the walls and floor, it was brought to a location where it was destroyed. (This based upon firsthand interrogations of Colombian and Cuban based narco-traffickers.)
Maybe the cartels can help out with some containers in the interest of facilitating commerce. It seems only fair.
Borderland
10-13-2021, 10:38 AM
In today’s article reporting a 5.4 percent increase in inflation in September, excluding energy prices. Also today, Social Security announced the largest increase in years. Here is what the Fed said:
Fed Vice Chairman Richard Clarida said Tuesday that the underlying rate of inflation in the U.S. economy is near the Fed’s 2% longer-run objective and, thus, that the recent surge will prove “largely transitory” once the supply bottlenecks clear. However, he said the Fed would raise rates if it saw evidence that households and businesses were beginning to expect higher inflation.
“Monetary policy would react to that,” Mr. Clarida said. “But that is not the case at present.”
78422
That's about $1200/yr. for me. Not a bad pay increase for doing absolutely nothing. ;)
Totem Polar
10-13-2021, 10:41 AM
Look at 1982!
Damn. 1981 too. No wonder my parents hated financing things.
:D
Over a long period of time, it definitely makes more sense to own than rent since you "earn" the imputed rent that you don't have to pay once you have your home paid for. But there is a point that the rent vs own intersects and normally, in the short term, you will be better of renting than owning. If you have a stable job and you plan on staying in the area/home long term, you absolutely should buy. If you job is unstable and you may be transferred or you may decide you don't want to live there in less time that it takes to make that intersection point, you could very well lose money, sometimes A LOT if we hit a major rough patch in the economy/area.
But you have to roll the die either way.;)
100% why my post specifically said renting makes more sense if you're only going to be in an area short term.
No disagreement from me there.
I'm not trying to convince you of anything. Your math was fucked and I pointed it out so other readers can make an informed assessment about whether to buy a place at the top of a bubble market. 2008 an all. Carry on.
My math was fucked? Sure thing, pops. Maybe you're just making assumptions.
Glad you know more about my own mortgage than I do. Phew. What would I do without you. I've never looked at the loan at all, so these numbers are completely new to me. AN INTEREST RATE!? By golly gee, what's that!?
Borderland
10-13-2021, 11:24 AM
The only catch, and what I am sure he was demonstrating is what "almost" happened to me and just something to be aware of.
In May of 2001 I moved to Clarksville TN and bought a very nice house in a very nice new subdivision. I paid $150k for the house. ($232,466 in 2021 according to CPI data). Then 9/11 happened.
Not only did we have a serious economic crisis but being a military town, there were a lot of shakeups in people leaving/coming etc that seriously depressed the housing market (and had the potential to have been much worse). So the house that I purchased for $150k was suddenly worth significantly less, but my mortgage was still for $142k (5% down with PMI). So I was in a job that I hated, that was in jeopardy, with a house that I owed more for than I could sell it for. This was not even considering the 6% closing costs that I would have to pay to a realtor to sell it.
The first few years that I was making my payments, very little was going to the principal of the loan. Instead, I was paying exclusively interest.
In effect, I was "renting it" from the bank for the interest payments and wasn't building any equity at all and wouldn't for several years.
"Luckily" I was in the house/job for 7 years, which wound up being enough time for the market/economy to recover enough that when I sold, I did not have to take a haircut and luckily got out selling it for $185k minus my closing costs but I still owed the bank a significant amount of money because even at 7 years in to a 30 yr mortgage my payment was very biased towards interest over principal. A few months after selling the even bigger housing crash of 2008/09 happened. If I had waited just a few more months to sell, it is very likely I would have owed money when I sold the house after paying closing costs.
Over a long period of time, it definitely makes more sense to own than rent since you "earn" the imputed rent that you don't have to pay once you have your home paid for. But there is a point that the rent vs own intersects and normally, in the short term, you will be better of renting than owning. If you have a stable job and you plan on staying in the area/home long term, you absolutely should buy. If you job is unstable and you may be transferred or you may decide you don't want to live there in less time that it takes to make that intersection point, you could very well lose money, sometimes A LOT if we hit a major rough patch in the economy/area.
But you have to roll the die either way.;)
I was going to say something like this but this is much better than I could do. My experience with owning has been about the same. Up until I was 30 ish I rented. I was always traveling for work and rarely where my stuff was. It made no sense to own and I probably couldn't have secured a loan anyway. I got married, got a local job and purchased a house, sold it and purchased a second one. The marriage lasted about 8 years and I kept the house. Sold that one eventually and purchased another one. In the mean time remarried and divorced again.
So I've rented and owned 3 houses. My take is, as Crow Hunter says, it depends. The best way to own is buy in a market trough when interest is low. Then be in a situation where you can build some equity over time. Even with that the home owner is totally dependent on the market when they sell. There may be long periods where the real estate market only increases your value 1 or 2% a year. I've seen that. Around 2008 I knew several people that just walked away from a house/loan because they owed a lot more on the house then it was worth.
It's looking like that may happen again. Interest is low but prices are inflated. Personally I don't think it's a good time to buy. I would be renting for a few years to see where the market goes. I read real estate columns stating that prices will never come down and real estate will just keep getting more expensive. I'm wondering who they think will be buying all of those houses. It won't be boomers because they will be looking to downsize into condos and apts. Millennials maybe but with a trashed economy and inflation (regardless what the man behind the curtain says) is going to devalue real estate yugely. I'm already seeing prices dropping in my area. In a few years they will be back to 2018 levels. That's my guess.
peterb
10-13-2021, 01:29 PM
A positive step?
——————-
The White House is announcing that the Port of Los Angeles has agreed to essentially double its hours and go to 24/7 operations. In doing so, it's joining the Port of Long Beach, which launched similar nighttime and weekend shifts a few weeks ago.
Together, the two California ports handle about 40% of the container traffic that enters the United States.
Their commitment to launch 24/7 operations is "a big deal," Transportation Secretary Pete Buttigieg told NPR's Asma Khalid. "You can think of that as basically opening the gates. Next, we've got to make sure that we have all of the other players going through those gates, getting the containers off of the ship so that there's room for the next ship, getting those containers out to where they need to be. That involves trains, that involves trucks, so many steps between the ship and the shelves."
https://www.npr.org/2021/10/13/1045501424/the-white-house-announces-steps-to-try-to-ease-backlogs-at-u-s-ports
Caballoflaco
10-13-2021, 03:01 PM
A positive step?
——————-
The White House is announcing that the Port of Los Angeles has agreed to essentially double its hours and go to 24/7 operations. In doing so, it's joining the Port of Long Beach, which launched similar nighttime and weekend shifts a few weeks ago.
Together, the two California ports handle about 40% of the container traffic that enters the United States.
Their commitment to launch 24/7 operations is "a big deal," Transportation Secretary Pete Buttigieg told NPR's Asma Khalid. "You can think of that as basically opening the gates. Next, we've got to make sure that we have all of the other players going through those gates, getting the containers off of the ship so that there's room for the next ship, getting those containers out to where they need to be. That involves trains, that involves trucks, so many steps between the ship and the shelves."
https://www.npr.org/2021/10/13/1045501424/the-white-house-announces-steps-to-try-to-ease-backlogs-at-u-s-ports
I’m sitting on the other side of the continent wondering why this hasn’t happened months ago.
Oldherkpilot
10-13-2021, 03:04 PM
I’m sitting on the other side of the continent wondering why this hasn’t happened months ago.
Ditto
peterb
10-13-2021, 03:14 PM
I’m sitting on the other side of the continent wondering why this hasn’t happened months ago.
Agreed. Given what we’ve heard about worker shortages, it may have been a lack of people, or fighting about who would pay the higher salaries needed to attract another shift.
OlongJohnson
10-13-2021, 03:42 PM
To the best of my knowledge, everyone who works on the docks is unionized. I wonder how much of it involved non-reported negotiations with the unions about stepping it up.
There's also the issue of human performance in what is normally a pretty fast-paced, high-stress activity where small mistakes can have huge consequences. Pushing individual employees into an area where they are more likely to make mistakes could be counterproductive, while hiring new employees and getting them up to speed has not been easy.
fly out
10-13-2021, 03:51 PM
Not saying it's true, or that it's not just fingerpointing, but I read that this 24-hour operation was tried, and the restrictions on which trucks were allowed entrance to the port just shifted the jam to containers not being able to be trucked out.
OlongJohnson
10-13-2021, 04:40 PM
Details on the restrictions? Does it have anything to do with them having to be "green," as in EV, hybrid, super ultra low emission tractors, etc? Or is it more operational, like driver training/certification for operating in that environment, number of trucks per hour, etc?
Joe in PNG
10-13-2021, 05:33 PM
Ever read WWII history, and the repeated tales of Wehrmacht quartermasters refusing to release essential supplies to troops even when the Red Army was knocking on their doors, because the proper procedures weren't followed?
Kinda like that.
RoyGBiv
10-13-2021, 05:38 PM
Details on the restrictions? Does it have anything to do with them having to be "green," as in EV, hybrid, super ultra low emission tractors, etc? Or is it more operational, like driver training/certification for operating in that environment, number of trucks per hour, etc?
Union
MickAK
10-13-2021, 08:04 PM
I really don't feel like the longshoreman's strike was that long ago, so I'm surprised that there's so much ignorance in this thread, but I guess people forget things quickly.
Unloading ships has been a goatfuck for decades because the longshoreman union is very well put together and doesn't take any shit. This is the case from San Diego to Nome. They're incorrigible lazy motherfuckers to deal with.
Amateurs think tactics and professionals think logistics.
Walmart can charter all the ships it wants but without some healthy bribes up in LBC it ain't moving shit. Which is what happened. Right palms got greased.
Catshooter
10-13-2021, 10:15 PM
Wonder where all of a sudden they're gonna find twice the crane operators/truck drivers and trucks?
Well, the Fed.gov has stepped in, so we can all relax. What could go wrong?
peterb
10-16-2021, 07:16 AM
Speaking of the truck driver shortage….
——————-
A high school in California is now training teens to enter the industry through its truck driving school program.
Patterson High School in Patterson, Calif., is one of the first non-vocational high schools in the country to offer a truck-driving program for students.
The elective course, which is open to seniors, is a part of the school's Career Technical Education Program — helping students learn workplace skills through hands-on training.
https://www.npr.org/2021/10/13/1045463623/high-schoolers-are-training-to-drive-18-wheelers-amid-a-shortage-of-truck-driver
Welder
10-16-2021, 10:25 AM
Good for that High School.
Meanwhile we're phasing out the ability of people to get their CDL licenses by studying the book and then taking the test with one of their employers' trucks (this is how I got my CDL all those years ago, BTW). Starting I believe in Feb, you *must* take a class with an approved instructor if you're an entry-level wannabe driver, which of course will mean thousands of dollars out of your pocket. I know I didn't hardly have two silver dollars to rub together when I passed my CDL test. Those CDL classes the local community college was offering at the same time were $5,000. There was no way.
So I guess what's going to happen is that if our goal is to still have people entering the trucking industry, the trucking companies or the fed gov't will subsidize people taking these classes, and it'll be one more burden on the end purchaser / taxpayer.
Don't get me wrong, classroom instruction is great, but IMO eliminating the path for self-starters isn't so great. I wonder if anybody did the research and determined that people who went through classroom instruction were in fact safer drivers....5, 10 years down the road. If so, then I'm for the concept. But I do wonder if this is another visit from the Good Idea Fairy.
rcbusmc24
10-17-2021, 08:17 PM
A guild is an association of artisans and merchants who oversee the practice of their craft/trade in a particular area. The earliest types of guild formed as organizations of tradesmen, belonging to: a professional association, a trade union, a cartel, and/or a secret society. They sometimes depended on grants of letters patent from a monarch or other ruler to enforce the flow of trade to their self-employed members, and to retain ownership of tools and the supply of materials, but were mostly regulated by the city government. A lasting legacy of traditional guilds are the guildhalls constructed and used as guild meeting-places. Guild members found guilty of cheating on the public would be fined or banned from the guild.
Typically the key "privilege" was that only guild members were allowed to sell their goods or practice their skill within the city. There might be controls on minimum or maximum prices, hours of trading, numbers of apprentices, and many other things. As well as reducing free competition, but sometimes maintaining a good quality of work. Often these rules made it difficult or impossible for women, immigrants to the city, and non-Christians to run businesses working in the trade....
Why do I post this?... Because a thought entered my mind the other day that a lot of medieval style stuff seems to be coming back into vogue in the modern era. The general destruction of the wage earning middle class, the ever higher educational "requirements" and "certifications' of dubious value for various jobs that seem suspiciously like a protection racket, the general debt entrapment of the younger generations, and the increase in emphasis many seem to be putting on othering each other in order to devalue them for eventual exploitation. When I put it all together, I sometimes get the feeling that some of our rentier elites are trying to recreate feudal Europe..... and they are succeeding...
Joe in PNG
10-17-2021, 08:27 PM
A guild is an association of artisans and merchants who oversee the practice of their craft/trade in a particular area. The earliest types of guild formed as organizations of tradesmen, belonging to: a professional association, a trade union, a cartel, and/or a secret society. They sometimes depended on grants of letters patent from a monarch or other ruler to enforce the flow of trade to their self-employed members, and to retain ownership of tools and the supply of materials, but were mostly regulated by the city government. A lasting legacy of traditional guilds are the guildhalls constructed and used as guild meeting-places. Guild members found guilty of cheating on the public would be fined or banned from the guild.
Typically the key "privilege" was that only guild members were allowed to sell their goods or practice their skill within the city. There might be controls on minimum or maximum prices, hours of trading, numbers of apprentices, and many other things. As well as reducing free competition, but sometimes maintaining a good quality of work. Often these rules made it difficult or impossible for women, immigrants to the city, and non-Christians to run businesses working in the trade....
Why do I post this?... Because a thought entered my mind the other day that a lot of medieval style stuff seems to be coming back into vogue in the modern era. The general destruction of the wage earning middle class, the ever higher educational "requirements" and "certifications' of dubious value for various jobs that seem suspiciously like a protection racket, the general debt entrapment of the younger generations, and the increase in emphasis many seem to be putting on othering each other in order to devalue them for eventual exploitation. When I put it all together, I sometimes get the feeling that some of our rentier elites are trying to recreate feudal Europe..... and they are succeeding...
It's something I've noticed as well. Plus, panem et circenses is a proven long term method of turning free citizens into serfs. UBI is a great idea, until you find yourself given a guaranteed lifetime green job for you and your children, with free eco-friendly tiny house. Just don't fall afoul of the sumptuary laws, get too mad about just prime noctus, and be sure to tug your forelock when speaking to your betters.
Wondering Beard
10-17-2021, 11:12 PM
I sometimes get the feeling that some of our rentier elites are trying to recreate feudal Europe..... and they are succeeding...
It is in the nature of politics that those who become powerful want a system in which they don't get to lose that power.
peterb
10-18-2021, 06:34 AM
Example: My state requires more training hours to be a licensed hairdresser than a licensed EMT.
I’ll be less cynical and say that some of these education and licensing requirements probably come from a sincere desire to protect consumers.(there are some truly nasty chemicals used on hair and nails) That said, I’d be in favor of replacing mandatory licensing with mandatory disclosure for some jobs. You want to be a barber? Ok, but your sign has to clearly state “Unlicensed”. Let customers decide if there’s value in the certification.
Homebuilt aircraft must have a clearly visible plaque in the cockpit stating “Experimental…does not comply with federal safety regulations for standard aircraft” so that passengers know what they’re getting into. Taking a similar approach to some occupations seems like a reasonable option.
Borderland
10-18-2021, 10:25 AM
Wonder where all of a sudden they're gonna find twice the crane operators/truck drivers and trucks?
Well, the Fed.gov has stepped in, so we can all relax. What could go wrong?
I'm pretty sure that longshoremen aren't going to bust their ass working a bunch of overtime. At some point the increased deductions on the overtime reduces it to about the same rate as straight time. Who wants to work a 60 hr week for straight time. This is CA we're talking about. A good percentage of those overtime paychecks will go to the state and union pensions.
Where I worked I was constantly asked to work 60 hours a week to keep up with contractors schedules. Because of our union there was no mandatory overtime for hourly workers. When I broke it down the money I actually ended up keeping wasn't enough for me to work those 60 hour weeks. I did work some overtime when I could see an honest need for it but it was rare. Mostly the requests were because of mismanagement of schedules and resources which wasn't a part of my job.
So yeah, somebody else is going to pick up the slack.
WSJ today:
Demand for consumer products has been unusually strong since countries began to reopen their economies. This has put pressure on global transport routes and increased the cost of logistics. In the first quarter of 2020, a company could ship goods by sea for $1,600 per 40-foot equivalent unit, or roughly one large shipping container. By September 2021, the bill had climbed to $10,200, Bernstein analysis shows.
Air and road travel is also pricier, as there are fewer jets in the skies and transport firms are struggling to hire drivers. Europe is short of approximately 400,000 truckers, according to Transport Intelligence estimates. A similar shortage in the U.S. pushed spot rates for dry trucks up 13% on the year by the third quarter.
Poconnor
10-19-2021, 08:24 PM
Don’t forget the new federal requirement for ELDs for truck drivers. These new electronic devices really stopped truck drivers being able to fudge their logs. The ELDs also made many older drivers retire.
WSJ today:
Demand for consumer products has been unusually strong since countries began to reopen their economies. This has put pressure on global transport routes and increased the cost of logistics. In the first quarter of 2020, a company could ship goods by sea for $1,600 per 40-foot equivalent unit, or roughly one large shipping container. By September 2021, the bill had climbed to $10,200, Bernstein analysis shows.
Air and road travel is also pricier, as there are fewer jets in the skies and transport firms are struggling to hire drivers. Europe is short of approximately 400,000 truckers, according to Transport Intelligence estimates. A similar shortage in the U.S. pushed spot rates for dry trucks up 13% on the year by the third quarter.
78732
Wondering Beard
10-23-2021, 09:34 AM
Click on the link, it's an interesting thread.
https://twitter.com/typesfast/status/1451543776992845834
Borderland
10-23-2021, 09:50 AM
Click on the link, it's an interesting thread.
https://twitter.com/typesfast/status/1451543776992845834
Appears to have disappeared.
Wondering Beard
10-23-2021, 09:54 AM
Appears to have disappeared.
Try this: https://twitter.com/typesfast/status/1451543776992845834
Borderland
10-23-2021, 10:21 AM
Try this: https://twitter.com/typesfast/status/1451543776992845834
Works now, thanks.
That's the best coverage of this fiasco that I've seen.
Summation.
Leadership is the missing ingredient at this point.
Borderland
10-23-2021, 12:04 PM
Looks like the trucking companies don't want to go into the container storage business. If the price of taking a container out of the port is to store an empty container on their property (even if they can do that) they'll have to substantially increase their prices to haul containers.
I don't know anything about trucking companies but 10 years ago I saw companies ditching their container trailers along I-5 on private property until they could get another call to pick up some containers at the port of Seattle. The drop off point was about half way between Seattle and Vancouver BC. The site was hidden behind Alderwood mall and unused by any of the businesses there. Just about any day you could find 4 or 5 trailers in there. I had to call a trucking company one time to get them to move a loaded trailer they left in the county ROW so I could do some work there.
JohnO
10-24-2021, 11:35 AM
Fire Sale!
Fire breaks out on cargo ship off Canada's coast, expelling toxic gas
https://www.nbcnews.com/news/world/fire-breaks-container-ship-canadas-coast-rcna3670
https://media-cldnry.s-nbcnews.com/image/upload/t_fit-2000w,f_auto,q_auto:best/rockcms/2021-10/2021-10-24T033659Z771650033RC2UFQ9BKG7KRTRMADP3CANADA-SHIP-169d4a.jpg
ccmdfd
10-25-2021, 08:39 AM
Appears to have disappeared.
Interesting read.
What isn't clear to me is; why are there so many empty containers out there now? What's different compared to 2018?
I was always under the impression that as soon as a container is emptied, someone else is ready to fill it back up.
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