Long time no see-big picture

Long time no see-big picture



Prices change rapidly, but the underlying factors driving the economy and the market often take decades.We tend to ignore this because we are Here now.

When the power accumulated over a long period of time-supported by institutional dynamics and broad consumer beliefs-comes into play, it is difficult to change instantaneously. The power that has been building for decades may be overlooked by some. However, they have contributed to the current state of change and are the driving forces of growth, inflation, politics and economics:

——Responding to the Great Financial Crisis (GFC): It’s hard to imagine that nearly fifteen years after the global financial crisis, we still– still – Fight the consequences of the incident. The combination of monetary-based response measures and financial assistance has led to slow growth and the recovery of low wages lags behind historical precedents.

This has a dual effect: First, the results of the weak global financial crisis relief may lead to overcompensation in the CARES Act through a large number of fiscal stimulus measures. Second, the terrible, substandard recovery from the global financial crisis has paved the way for the rise of domestic and international popularism.

——Timely inventory and lean supply chain: The efficiency and profitability of not having to maintain a large inventory of goods is a kind of catnip for retailers and logistics companies. But this also makes a country less resilient and more vulnerable to disruptions such as pandemics. This became apparent in the first quarter of 2020, when everything from PPE/masks to Purel to Lysol to toilet paper became scarce. Solutions include local manufacturing and storage and inventory incentive changes, but these changes will take time.

——NIMBYism + housing: Part of the reason for the insufficient supply of single-family homes is the overbuilding and The new residential building subsequently collapsed In the next few years.

However, almost the entire post-war era has a broader problem, and that is the concept of “not in my backyard”. Of course, everyone says they want affordable housing, But not if it is near them And may affect the value of the property. We gentrify the entire community, but fight against zoning rules that allow greater density. The result is not only too few affordable housing, but also too few housing options and high costs.This is true regardless of party affiliation, although yesterday I mentioned why this has become Very bad exist Lanzhou. Building more houses is a solution, but it takes time.

——Embedded technology: Personal computers, the Internet, mobility, applications, and broadband create a series of environments that allow easy access to a full set of work tools, allowing a wide range of professionals to work easily at home. This includes creatives, financial professionals, law, accounting, media, etc. These groups have great flexibility in terms of where and how they work.

Is it surprising that workers in hotels, catering services, healthcare, and retail have fled these fields into the white-collar workforce? This is not just money: it represents autonomy and control measures, making you feel less like a serf, more like an autonomous professional.

Some of the issues we discussed Bogleheads podcast It boils down to our concept of the world and the flawed model we create in our heads. We did not market-weight the stocks and underestimated the strength and rarity of the biggest winners. We also value news, and overemphasize and believe stories that are fleeting, temporary, and of little significance.

The current situation has been around for a long time. Our instinct is to do something (anything!) to stop short-term pain. But the reality is that over time, the worst things will resolve themselves. This will also pass.

But to solve potential long-term problems, it requires more than just mobilizing strategic oil reserves or replacing the chairman of the Federal Reserve. This means discussing fundamental changes in the way we deal with housing, employment, manufacturing, and capital. I’m not sure how big this appetite for rethinking is.

How everyone miscalculates housing needs (July 29, 2021)

Faster/better/cheaper (November 11, 2021)

Deflation, interrupted by the spasm of inflation (June 11, 2021)



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