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The Economy

We bought in early 2021 and sold early this year after moving to rent, so we partially participated in the benefits, although they were eaten into my transaction costs on both ends.

Based on The NY Times rent vs. buy calculator that has a pretty comprehensive long term view, even if my landlord tripled the rent tomorrow I’d be better off long term renting vs. buying the same place with 20% down, when I can invest the difference.

If I had to guess, prices will go sideways for a few years and interest rates might settle in around 6% or so. And I don’t think lowering interest rates again would increase home prices. Any economic event that forces interest rates any lower than 6%-ish might kill demand and increase supply since people are probably losing, or worried about losing, their jobs. In 2009 my area had houses basically half price and no one was out there buying. And in that situation why buy now when it might be another 5% cheaper in a few months (or at least that seemed to be the general sentiment, which is why deflation is a bad thing).
 



In all seriousness, thanks Obamas. They didn’t have the foresight to understand how making America not-fat would cripple the economy. MAFA.
 
I want to believe he’s trolling but I know he’s incapable of that.

He also didn’t think printing trillions of dollars for everyone would lead to inflation in the first place.

 



Man, I’m tipping way too much for Uber drivers and food delivery if half the country is leaving nothing at all. And to not tip anything at a sit down restaurant or barber is not just gross but also objectively nonsensical from a cost-benefit perspective. You’re eating spit and piss and risking getting your ears cut off the next time you go.
 
SeanMayTriedToEatMe said:



Man, I’m tipping way too much for Uber drivers and food delivery if half the country is leaving nothing at all. And to not tip anything at a sit down restaurant or barber is not just gross but also objectively nonsensical from a cost-benefit perspective. You’re eating spit and piss and risking getting your ears cut off the next time you go.
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Probably in the next ten years, 99% of restaurants and bars will have some sort of automated serving system. Waiters and waitresses will go the way of the guys in the 50s and 60s at every gas station who filled up people's gas tanks, checked their oil, and cleaned their windshields.
 
I always tip on the first four items. Only time I tipped the hotel housekeeper was back in college when my friends and I would go on roadtrips to Nebraska away football games. There would usually be 6 to 8 of us staying in the room so it always felt like something we should do since usually there were a lot of alcohol cans/bottles in the trash cans. But other than that, I've never tipped housekeepers since I usually just clean up after myself. I would tip if I had more disposable income available but I'm still pretty tight money wise at the moment.
 
DrKlahn said:
thepointsguy.com

Delta SkyMiles changes: Delta overhauls how you earn Medallion status in biggest change yet - The Points Guy

Delta Air Lines is totally revamping the SkyMiles Medallion elite program — and not necessarily in a good way.
thepointsguy.com thepointsguy.com

@DurhamSon it's here!

I'm not smart enough to figure out all of the implications at once, but it looks close to what you described; i.e., paradigm shift to a pay-to-play model for premium perks. Business travelers who racked up segments flying from one podunk town to another (always with a connection each way) must hate it. I have no idea if I like it--I never got very far up the medallion ladder under the old system, so I guess it's fine for me. One thing that really struck me is the favorable treatment given to booking hotels and vacation packages through Delta. If you are willing to take what they give you, and you have a decent-sized travel budget, you make it a lot easier to move up in elite status. Seems like a move to eventually compete with the online travel companies, but if that's the case, their product has a long way to go.
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The walkback is here:




Sort of what was expected in that no bones were thrown to the non-profitable main cabin business travelers by counting miles flown for anything, but they did lower the medallion level spending caps and made pretty sensible changes to lounge entry (including not making layover lounge visits count as an extra visit)


In addition to these changes, an American Express spokesperson told CNN Underscored that SkyMiles members with a Delta Reserve, Delta Business Reserve, Delta Platinum or Delta Business Platinum will receive a $2,500 MQD head start per card type starting February 1, 2024.
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Kind of burying the lede here? So if one opens the Reserve + Platinum, that already puts you at the $5k level which means instant silver? And for a sicko who opens all four, that starts them at $10k, for Gold? Clearly not worth the annual fee to do so, obviously. But peculiar that all this was initiated with the intention of clearing out the glut of forever-status travelers, and yet someone with 1-2 cards will essentially start with status, or only have to put a trivial amount on the card to achieve it and higher levels of it. Makes sense if card sign-ups are the most sought after metric of all
 
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Congrats, diamond hands of Duke-Forum. Still think it’s weird that it’s roughly tracking the S&P 500 now, just with more volatility. If that holds, there’s no reason for it to exist as an asset other than its functional use in society.
 



The CEO of McDonald's will determine the winner of the 2024 Presidential Election. If Big Macs are $15 at that time, Biden is done.
 




This whole piece is *chef’s kiss*. I think my favorite part is that he’s retired and living off passive income, but chooses to live in San Francisco anyways and pay the totally normal and rational rate of $84,000 a year in private school tuition for his elementary school aged children.


I always wonder if the subjects in these pieces have the self awareness to know they are being chronicled precisely because their complaints drive readers to click through because they hate them.
 
The $26k a year on food confuses me. I think I spend 1/3 to 1/2 of that for a family of four, and while the kids will eat a lot more later on, that’s just going to be cheap fast food crap, and I could easily cut the expenses by not ordering stuff like gigantic platters of sushi every week.

The $86k a year on housing when there’s no mortgage to pay off is also odd. Assuming $30k in property taxes, very generously, $56k in maintenance every year is wild. A mid to high end kitchen remodel every year.

Cut those two numbers in half and he’s within budget, even with 2 private tuitions and choosing to live in the dumbest place possible. He could also probably scale down to leasing something perfectly good like a Hyundai Ioniq or Tesla Model Y instead of what is presumably an unnecessary set of EV cars like BMW/Audi.
 
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That school cost is absurd on that income and the scenario is potentially just fake, especially given that it’s the NY Post. Pure rage bait and the truth is probably somewhere in between.

I’m in South Bay which has the same issues, no reason to buy here at all if you don’t already own. Generic 3-4BR townhomes renting at the market rate of $5k are selling for $2-2.5M and would be something like $15-20k a month PITI + HOA with 20% down at current interest rates. No reason not to rent and invest the difference if you can.

But assuming even $5k in rent if you have a family and/or need multiple rooms for WFH days (everything is “hybrid”, even the local jobs) + $500 or so electric and $1500 for food, add a modest hobby and all the other incidental things that you’ll need, it’s easy to get close to $10k/mo in expenses even without children and not living lavishly. After taxes and a reasonable 401k holdout, you’d need $120k/year to tread water, possibly save a little bit, which would require nearly 200k pre-tax. At this point with how prevalent layoffs are in the most common industries there, you may have to add a risk premium for that.

The alternative is to move somewhere lower COL, where salaries are nearly cut in half and you find that you’ve reduced your take home pay even more than you’ve reduced your rent and now live in the middle of nowhere. No good answers, things cost a lot.
 
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