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Does anyone have any ideas on the current and future "real" inflation rate?

I know on paper it seems quite low, but my anecdotal experience is as follows:

I recently bought a used car. I got lucky and got a decent deal, but prices are in general way up and inventory low.

A buddy found an airplane for about 60-70% more than I would have guessed a year ago. Airplane prices are up and inventory is low.

We are off and on boat shopping and and prices are in general up and inventory low.

My life loves Zillow and prices are up, inventory is low, and houses sell fast.

I wanted to pick up another HF radio and this is seemingly next to impossible. Prices are up and inventory is nearly non-existent.

Besides for the stimulus effect, IMHO the far larger issue is everyone that didn't lose their job. There is a vast army of people who haven't been anywhere or done anything in a year sitting on a big pot of money they didn't spend. Add to that global supply chain issues and ..........$$$$$$$$$$$

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Just had this conversation. In my industry prices are up 30% in 2 years. Legit inflation is on the way. 5-7% easily right now

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I've been wondering about this a lot lately. Real estate in general, everywhere I look, is locked in low inventory high demand cycle. Everyone is buying and no one is selling. How is this even possible?

My buddy in Palm Desert sold his cute little condo in 12 hours for far above listing price. Fortunately he'd managed to locate and buy a larger one for not much more than he sold  the small one, but fortunately for him there aren't many people our age looking to upsize to 3800sf.

It is a puzzlement.

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Official inflation figures are and always have been bullshit.

My first "real" job paid $0.65/Hr. I started at IBM in '72 for $2.40/Hr.

We bought out first condo in 1980 for $31K - it would be close to a $Mil now.

I can remember in the early 70's everyone bitching when the cost of a beer in a bar went from $0.20 to $ 0.25

Saw an ad for new Dodge pickups the other day - just the discounts added up to well into 5 figures - about what a comparable truck cost 25 years ago.

A decent burger is at least $20

But inflation has been like 2% P/A for the past 30 years?

Right.

If you want to know what real inflation has been over our lives so far, just watch an old 50's TV show and see what the prices are in the background - burgers $0.27, paying for a haircut with coins, buying drinks with coins etc.

Money has inflated two orders of magnitude - at least - in my life so far.

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I am talking more short term. I wanted to grab a decent 2-place airplane so we could run to Cape May in 35 minutes or maybe the Outer Banks in about 2 hours. That should run about $20,000-$22,000 or so if I don't want the bargain plane with the ugly paint and they usually are sitting waiting for a buyer. Try $38K now and better have cash in hand. WTF?

Forget 1950s to now. Think January 2020 to now.

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I use the harken index. How much is the small single ball bearing block. $7 in the mid 90s. $20 now

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In 1983 we bought a brand new 30’ sailboat for $36,000. Came fully commissioned, 5 North sails, and Datamarine instruments.  Probably spent another $800 or so on fenders, dock lines, boat hooks, life jackets, etc.  That boat, if available today, counting inflation only, should be about $96,000.  I know of no such boat being available.

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1 hour ago, bletso said:

nickle candy bar  dime coke   10cents a gallon for gas   10¢ loaf of bread

Reminds me of an old joke. New bride calls her mother. She's in tears.

Mom: Honey, what's the matter?

Bride: I'm trying to make Grandma's famous meat loaf, but I just can't get it right.

Mom: Are you following the recipe?

Bride: Yes, (sob!) exactly as it's written.

Mom: Well calm down. We'll go over it together and work out what's going wrong. Now read me the first line of the recipe.

Bride: OK Mom. It says to take 25 cents worth of ground beef...

 

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5 hours ago, bletso said:

10cents a gallon for gas

That's more or less the same as when I was born.

Of course, you have to use the silver dimes that were in circulation when I was born, but hey, a dime's a dime, right?

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9 hours ago, Willin' said:

I've been wondering about this a lot lately. Real estate in general, everywhere I look, is locked in low inventory high demand cycle. Everyone is buying and no one is selling. How is this even possible?

My buddy in Palm Desert sold his cute little condo in 12 hours for far above listing price. Fortunately he'd managed to locate and buy a larger one for not much more than he sold  the small one, but fortunately for him there aren't many people our age looking to upsize to 3800sf.

It is a puzzlement.

this is our dilemma ...we want to sell our Condo and get a house but we wont be better off financially as the cost of homes has gone through the roof here in NY.  So, were thinking of asking mother in law if we can have 2 acres or her land adjacent to the family homestead and build a house on the property.  We figure we're going to get MIL's house and property at some point in our lives, and then we can rent the house out...........

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This weekend I sold a four wheeler, trailer and dirt bike back to the same shop I had bought them. 

The owner of the shop looked up the invoice and offered me the exact price I had bought the things for last year!

He said they can’t keep any inventory in stock, new or used. They are trying to find any vehicles to have in their showroom.

 

aaaaand my boat was listed for 45 days before it sold and I had 20+ different people inquire about it.

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10 hours ago, kent_island_sailor said:

Does anyone have any ideas on the current and future "real" inflation rate?

I know on paper it seems quite low, but my anecdotal experience is as follows:

I recently bought a used car. I got lucky and got a decent deal, but prices are in general way up and inventory low.

A buddy found an airplane for about 60-70% more than I would have guessed a year ago. Airplane prices are up and inventory is low.

We are off and on boat shopping and and prices are in general up and inventory low.

My life loves Zillow and prices are up, inventory is low, and houses sell fast.

I wanted to pick up another HF radio and this is seemingly next to impossible. Prices are up and inventory is nearly non-existent.

Besides for the stimulus effect, IMHO the far larger issue is everyone that didn't lose their job. There is a vast army of people who haven't been anywhere or done anything in a year sitting on a big pot of money they didn't spend. Add to that global supply chain issues and ..........$$$$$$$$$$$

There isn't any big pot of money for trades-people, or service workers, or artisans/artists/craftsmen.

 Our income is down about 57% from this time last year.

I'm guessing by the unemployment/poverty

rates, that more people are in my dinghy, than your yacht.

6 hours ago, NeedAClew said:

Luxury goods are way up.  Stuff poor people buy not so much. 

You need more than a clew, you need a whole new sail.

When people who make $200K buy a pound of hamberder it costs them (Crazy as it sounds) +- $8/Lb. When a person who makes $17K buys a pound of hamberder, it still costs +- $8/Lb. When a wealthy person fuels up their efficient 2021 Acura, it costs $2.83 per gallon. When a poor person fuels up their 1982 Dodge it costs $2.83 per gallon. Guess which one goes farther.

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Don't attempt to make money in Real Estate. And don't argue with me.

OK, now that we have that out of the way, hopefully we all can buy or rent a nice place to live - and be happy and secure.

Let's talk about inflation in the most detailed and truthful - and accurate way possible. I will make it about 3-4 sentences.

First, ALL of our current economy is completely fake. Interest rates are nowhere near "market" or "free market" and the whole thing only stays afloat due to manipulation. If any of you wanted to borrow money from me to, for example, buy a car - what should I charge you? I've made 10% per year for over 30 years in the market (SP is more than that!), so obviously I should charge more than that! 

So, that is that. Fake. Manipulated. Etc. - as long as it holds up, we ae all fine. If we die happy we are A-1.

It is very likely that it will fall apart - sooner or later. No one know when and no one will be able to do anything about it. That part is simple - anyone who thinks differently is a fool. 

So, eat drink and be happy. Invest in the stock market. Don't buy Real Estate except for your own use. Bye.

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Real estate is actually a great investment, but you have to be patient, and strike quickly when the iron is hot. Certainly, rental properties are a high risk investment, even in up-scale markets.

 

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2 hours ago, Mrleft8 said:

There isn't any big pot of money for trades-people, or service workers, or artisans/artists/craftsmen.

 Our income is down about 57% from this time last year.

I'm guessing by the unemployment/poverty

rates, that more people are in my dinghy, than your yacht.

You need more than a clew, you need a whole new sail.

When people who make $200K buy a pound of hamberder it costs them (Crazy as it sounds) +- $8/Lb. When a person who makes $17K buys a pound of hamberder, it still costs +- $8/Lb. When a wealthy person fuels up their efficient 2021 Acura, it costs $2.83 per gallon. When a poor person fuels up their 1982 Dodge it costs $2.83 per gallon. Guess which one goes farther.

This is a bit of  sidetrack from my original post, but I have been thinking about it quite a bit.

I can do my job from anywhere. The pandemic is basically me being home instead of at work doing the exact same thing but spending less money. No gas, no tolls, no movies, no restaurants, no flying, no vacations, and no more fun of any kind.

Then I know someone who is an event planner and their business has completely gone into the shitter.

So we are going to have a much more obvious dividing line in society than anytime in recent history and it may have as yet unknown unintended consequences.

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5 hours ago, craigiri said:

Don't attempt to make money in Real Estate. And don't argue with me.

OK, now that we have that out of the way, hopefully we all can buy or rent a nice place to live - and be happy and secure.

Let's talk about inflation in the most detailed and truthful - and accurate way possible. I will make it about 3-4 sentences.

First, ALL of our current economy is completely fake. Interest rates are nowhere near "market" or "free market" and the whole thing only stays afloat due to manipulation. If any of you wanted to borrow money from me to, for example, buy a car - what should I charge you? I've made 10% per year for over 30 years in the market (SP is more than that!), so obviously I should charge more than that! 

So, that is that. Fake. Manipulated. Etc. - as long as it holds up, we ae all fine. If we die happy we are A-1.

It is very likely that it will fall apart - sooner or later. No one know when and no one will be able to do anything about it. That part is simple - anyone who thinks differently is a fool. 

So, eat drink and be happy. Invest in the stock market. Don't buy Real Estate except for your own use. Bye.

Our housing market id ridiculous and has been for decades.

You cant buy an old, ordinary two bed Apt anywhere within 10KM of the CBD for under $420. Interest rates are 2-3%. Kids are borrowing half a million just for a fairly ordinary 3 bed in the outer suburbs. Banks are lending to anyone with a 10% deposit.

Picture of 4/56 Rayner Street, ALTONA VIC 3018

$420ish

Something has to give., Probably the low interest rates, then there's going to be a lot of pain.

,

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11 hours ago, Remodel said:

Reminds me of an old joke. New bride calls her mother. She's in tears.

Mom: Honey, what's the matter?

Bride: I'm trying to make Grandma's famous meat loaf, but I just can't get it right.

Mom: Are you following the recipe?

Bride: Yes, (sob!) exactly as it's written.

Mom: Well calm down. We'll go over it together and work out what's going wrong. Now read me the first line of the recipe.

Bride: OK Mom. It says to take 25 cents worth of ground beef...

 

That reminds me of a true story about my MIL.

She was a new bride attempting to bake her first cake from a recipe.

It said "leave room for rising" so she did - she went into the next room to smoke a cigarette, peeking around the corner from time to time to see how the cake was doing.

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5 hours ago, craigiri said:

Don't attempt to make money in Real Estate. And don't argue with me.

OK, now that we have that out of the way, hopefully we all can buy or rent a nice place to live - and be happy and secure.

Let's talk about inflation in the most detailed and truthful - and accurate way possible. I will make it about 3-4 sentences.

First, ALL of our current economy is completely fake. Interest rates are nowhere near "market" or "free market" and the whole thing only stays afloat due to manipulation. If any of you wanted to borrow money from me to, for example, buy a car - what should I charge you? I've made 10% per year for over 30 years in the market (SP is more than that!), so obviously I should charge more than that! 

So, that is that. Fake. Manipulated. Etc. - as long as it holds up, we ae all fine. If we die happy we are A-1.

It is very likely that it will fall apart - sooner or later. No one know when and no one will be able to do anything about it. That part is simple - anyone who thinks differently is a fool. 

So, eat drink and be happy. Invest in the stock market. Don't buy Real Estate except for your own use. Bye.

You live in Floriduh and expect people to take your advice?

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2 hours ago, Shortforbob said:

Our housing market id ridiculous and has been for decades.

You cant buy an old, ordinary two bed Apt anywhere within 10KM of the CBD for under $420. Interest rates are 2-3%. Kids are borrowing half a million just for a fairly ordinary 3 bed in the outer suburbs. Banks are lending to anyone with a 10% deposit.

Picture of 4/56 Rayner Street, ALTONA VIC 3018

$420ish

Something has to give., Probably the low interest rates, then there's going to be a lot of pain.

,

Banks stop giving those easy loans and the prices will take a dive. 

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6 hours ago, SloopJonB said:

That reminds me of a true story about my MIL.

She was a new bride attempting to bake her first cake from a recipe.

It said "leave room for rising" so she did - she went into the next room to smoke a cigarette, peeking around the corner from time to time to see how the cake was doing.

Wow, she was good at following instructions!

- DSK

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In Michigan, I bought my first house for 70K.  It shot up to 94K in two years, and I was lucky enough to sell it.  I saw it as low as $30k 3 years ago.

My current house, I purchased for $200k.  It was down to $130 as much as 6 years ago.  $200k 2 years ago.  Now it's $270k?

My truck, I bought for $21k 15 years ago.  5 years later with 70,000 more miles on it, I sold it for....$21k.  8 years ago I bought my current truck for $24k.  The insurance company would pay me $18 now if it was totalled.  The used car market was already getting silly before covid hurt new car production.  Now you can sometimes sell a lease car a year later for just as much as the original purchase price.

House prices aren't much mystery.  The new housing production absolutely stopped in Michigan when Covid hit.  As a result, there are simply no houses in the newer neighborhoods where folks want to move to, and housing prices have skyrocketed.  Housing construction is going stong now, but it's going to take a year to stabilizing and then the prices will start to fall again.  My wife and I have talked about selling and moving into a trailer in the short-short term to take advantage of the current prices, and then buying our retirement house in 5 years when the prices drop.

Houses are selling here within days, and prices are going for 10-15% above asking, with bidding wars being quite common.

A $5 fast food meal 5 years ago now costs you $15.  Grocery prices increasing substantially.

 

 

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On 4/5/2021 at 8:18 PM, Mrleft8 said:

Real estate is actually a great investment, but you have to be patient, and strike quickly when the iron is hot. Certainly, rental properties are a high risk investment, even in up-scale markets.

 

Anecdote is very strong in Real Estate "winning". My advice comes from the very basics - that over 150 years housing and real estate, in general, has gone up about 1.5% per year. But it's even worse than that.....because, as in gambling and other risks, the small guy (or gal) only has X in resources and credit and is often forced out of the game to allow for the "great deal" that someone else gets! Heck, I made a lot of money on REITS that provided financing to Real Estate when no one else might (Starwood). 

Speaking of such, a good Real Estate or similar REIT might return 10% a year. No one will call you about broken toilets or asbestos in the siding or roof. 

I am not doubting that some people make money in Real Estate - in fact, my own Dad probably made more money in Real Estate than he did in his manufacturing business. But he is also a unique personality who welcomes 24/7 work and actually enjoys dealing with tenants and the trials.

Anyway, don't want to get too far off-topic. It should go without saying that Supply and Demands and the super-low bar of "skills" needed to be a Realtor or buying and selling Real Estate are not the ideal. It's not an accident that people like Mr. Trump himself - in Real Estate - have gone broke time after time after time. If you look at what Realtors make. - only a tiny portion make a living wage.

But getting back to inflation, I would hope that most us agree we don't know squat. When it happens it's going to happen and we won't be ready for it - we will just be sitting back worrying about how far it might go. The Piper may not have to be paid in my lifetime - or even your (if younger) life. But likely, sooner or later, the US will deliver itself a knockout blow. The alternative would say "The US is very smart and therefore we will always have a handle on things".

I would hope the last decades have taught us that this is not the case. In fact, it's our mistrust that might cause the final cascade. Look at the way we went for Toilet Paper! What will happen if and when we decide the dollar is worth 1/2 of what we thought? 

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On 4/6/2021 at 1:43 AM, VhmSays said:

Banks stop giving those easy loans and the prices will take a dive. 

That is the whole basis of projection; if the Banks stop giving loans, why would prices dive and not level out.  On the whole the borrower is fully involved, so why would they take less? Stop borrowing and you end up with a lot of inventory that is not moving at a level price with some "bargains" from people that have to sell.

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On 4/5/2021 at 8:18 PM, Mrleft8 said:

Real estate is actually a great investment, but you have to be patient, and strike quickly when the iron is hot. Certainly, rental properties are a high risk investment, even in up-scale markets.

 

You need to be lucky.    The successful people claim it was wisdom that they weren’t in an area hurt by NAFTA or offshoring five years after they bought.  This time it’s virtual meetings and office space.    Next time it’ll be climate change, or even something nobody has thought of yet.   In real estate everybody is a pawn to great forces outside their control.   Sometimes they make you look smart, sometimes not.   Unless you can diversify around the world, it’s like farming.   Usually stuff grows but you can’t predict hail.

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On 4/6/2021 at 2:43 AM, VhmSays said:

Banks stop giving those easy loans and the prices will take a dive. 

Maybe. But now it seems that the IMF, the Federal Reserve and Bank of England admit that the money they dole out with loans is in fact new money, rather than our antiquated idea of loaning the money of the depositors out to the needs of the borrowers ...

In neo-economics, why ever stop giving loans? Unlike the market-money, the debt-money is essentially seen the water needed to keep the economic pumps running. In that case, the prices would take a dive or a leap based on inventory, rather than the availability of the money itself.

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The expectation of inflation is one of the biggest drivers.

When the general population loses faith in the currency, then sellers start demanding higher and higher prices, which buyers pay with increasing eagerness because they see their best move as spending the money they have as rapidly as possible before it loses more value.

It is extremely difficult to break this cycle. Most central banks have tried to fight it by restricting money in circulation... very difficult to do when so much of the nation's business is done with credit cards... and making futile public statements about the soundness of the currency. Then the public starts seeking foreign money in preference to their own, and the gov't & central banks fight that trend even harder.

Having lived thru an era in which the going interest rate was in the low teens, AND everybody was fine with it, I am not particularly worried about inflation in the USA just now. If anything, rising interest rates will boost my income nicely, thanks

- DSK

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Interest doesn’t seem to be believing in inflation.   I bet wrongly on fixed rate 11 years ago, expecting stimulus spending after the Great Recession.    Now that we are paying massive amounts in stimulus, labor shortages and lack of production / availability are wrecking havoc.   I’ll have to listen to Mike’s video.   It seems something is missing from the conventional wisdom.   
https://www.npr.org/transcripts/970595276

 

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On 4/5/2021 at 7:46 PM, Mrleft8 said:

There isn't any big pot of money for trades-people, or service workers, or artisans/artists/craftsmen.

 Our income is down about 57% from this time last year.

I'm guessing by the unemployment/poverty

rates, that more people are in my dinghy, than your yacht.

You need more than a clew, you need a whole new sail.

When people who make $200K buy a pound of hamberder it costs them (Crazy as it sounds) +- $8/Lb. When a person who makes $17K buys a pound of hamberder, it still costs +- $8/Lb. When a wealthy person fuels up their efficient 2021 Acura, it costs $2.83 per gallon. When a poor person fuels up their 1982 Dodge it costs $2.83 per gallon. Guess which one goes farther.

Right but not what I said. Rich people used to pay $43 for a pound of Kona coffee, now it's $50. Poor people don't buy it much.  Safeway generic is same price as last year.

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48 minutes ago, Lark said:

Interest doesn’t seem to be believing in inflation.   I bet wrongly on fixed rate 11 years ago, expecting stimulus spending after the Great Recession.    Now that we are paying massive amounts in stimulus, labor shortages and lack of production / availability are wrecking havoc.   I’ll have to listen to Mike’s video.   It seems something is missing from the conventional wisdom.   
https://www.npr.org/transcripts/970595276

 

One thing that's missing from the conventional wisdom is the international mega-corporations sitting on mountains of cash

No demand for capital = low/zero interest rates

Actually, now that interest rates are low, it makes perfect sense for the gov't to borrow squizillions of buck$. Problem, paying it back with printed money when interest rates start going up, this reduces the public confidence in the currency. A tightrope walk

- DSK

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5 minutes ago, Steam Flyer said:

One thing that's missing from the conventional wisdom is the international mega-corporations sitting on mountains of cash

No demand for capital = low/zero interest rates

Actually, now that interest rates are low, it makes perfect sense for the gov't to borrow squizillions of buck$. Problem, paying it back with printed money when interest rates start going up, this reduces the public confidence in the currency. A tightrope walk

- DSK

I can see that.    What else? 

Extreme fluctuations in product demand over the last year has to be playing a role.   The market may strive toward efficiency but is very inefficient in the midst of change.    This doesn’t explain the last decade, but does the last year.

I used to think boomer retirement money was causing a lot of upward pressure on investments, but as they aged from accumulation to divestment the effect was minimal.    I guess their input was lost amongst one percenters owning 80% and 10 percenters owning 88% of the pie.    That makes me think economic models can and do safely ignore 90% of the population for simplification.   The further from the top you live, the more the models look like fiction.   

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6 hours ago, Steam Flyer said:

The expectation of inflation is one of the biggest drivers.

When the general population loses faith in the currency, then sellers start demanding higher and higher prices, which buyers pay with increasing eagerness because they see their best move as spending the money they have as rapidly as possible before it loses more value.

It is extremely difficult to break this cycle. Most central banks have tried to fight it by restricting money in circulation... very difficult to do when so much of the nation's business is done with credit cards... and making futile public statements about the soundness of the currency. Then the public starts seeking foreign money in preference to their own, and the gov't & central banks fight that trend even harder.

Having lived thru an era in which the going interest rate was in the low teens, AND everybody was fine with it, I am not particularly worried about inflation in the USA just now. If anything, rising interest rates will boost my income nicely, thanks

- DSK

Are you viewing inflation in terms of a perfect free market or in terms of an economy dominated by large oligopolies.  It is very important that the price/demand curve for oligopolies has a distinct kink which locks the oligopolies into a set price.  Inflation as such is then hard to induce in the portions of the economy that are controlled by oligopolies.  The effects of inflation then become reduced buying power of a set unit of money.  Price of gasoline over time is an example.  The "price" as such doesn't go up.  The value of the currency goes down.  There is a difference.

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5 hours ago, Steam Flyer said:

One thing that's missing from the conventional wisdom is the international mega-corporations sitting on mountains of cash

No demand for capital = low/zero interest rates

Actually, now that interest rates are low, it makes perfect sense for the gov't to borrow squizillions of buck$. Problem, paying it back with printed money when interest rates start going up, this reduces the public confidence in the currency. A tightrope walk

- DSK

If people are paying that much money for baseball cards, you know there is a lot of dead capital out there.  Fortunately, as the production of Covid vaccine has shown, if there is a legitimate use for the capital, it can be found.  Will we run out of "savings" before the bill is paid off?

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The fact is that (With the exception of islands in the Pacific that the Chinese are building) They're not making any more land. If you're in a place that has an expanding commercial, or residential potential, your land will become more valuable. Of course, if you wait too long, and the market taps out, then you lost.

 In south Florida, land is disappearing, crime is rising, and people are moving north.... But not north as in NYC....

 A 100 acre chunk of undeveloped land that was worth 500K 5 years ago, is now worth about $1,200,000, if it has road frontage, and reliable water.

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2 hours ago, Laker said:

Are you viewing inflation in terms of a perfect free market or in terms of an economy dominated by large oligopolies.  It is very important that the price/demand curve for oligopolies has a distinct kink which locks the oligopolies into a set price.  Inflation as such is then hard to induce in the portions of the economy that are controlled by oligopolies.  The effects of inflation then become reduced buying power of a set unit of money.  Price of gasoline over time is an example.  The "price" as such doesn't go up.  The value of the currency goes down.  There is a difference.

There's no difference between the value of a currency going down or prices going up

There is certainly a difference between all the myriad goods and services in the market, or even categories of them. When evaluating the "Cost Of Living" and the rate of overall inflation, economists look at standardized "bundles" of goods & services that almost everybody uses, like gasoline, electricity, bread, pencils, beer....

What you're saying about the mega-corporations rings true though. Many of them are vertically integrated enough to be considered economies all their own. They have monopsony buying power within certain markets and pricing power with their final products... and of course the political power to have their lobbyists write favorable-to-them legislation which us normal citizens apparently cannot

- DSK

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  • 1 month later...

https://www.npr.org/2021/05/12/995979620/no-you-are-not-imagining-it-prices-for-a-lot-of-things-did-jump-in-april
 

no, we aren’t imaging it,    Months of help wanted signs all over town are forcing a second round of wage increases as I struggle to expand back to 2017 employment.   That means 2021 will require at least one more round of price increases.   It appears I’m not alone.   Hopefully everybody else is getting a wage increase to pay for my price increase to pay for my wage increases.   

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On 4/7/2021 at 10:13 PM, Steam Flyer said:
On 4/7/2021 at 7:56 PM, Laker said:

... The "price" as such doesn't go up.  The value of the currency goes down.  There is a difference.  ...

There's no difference between the value of a currency going down or prices going up

 

I apologize, belatedly. What I posted above, is not entirely correct. It's true in a limited way, when you're talking about one particular good/service, a common bundle, or a specific defined market, there's no difference.

But if you're talking broadly, across states or countries, there is a difference and it can be big. When currency goes down, the numeric price of everything goes up equally... which can distort relative values (market opportunity!).

My apologies for cutting it short earlier. Hope things are going well now

- DSK

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39 minutes ago, Lark said:

https://www.npr.org/2021/05/12/995979620/no-you-are-not-imagining-it-prices-for-a-lot-of-things-did-jump-in-april
 

no, we aren’t imaging it,    Months of help wanted signs all over town are forcing a second round of wage increases as I struggle to expand back to 2017 employment.   That means 2021 will require at least one more round of price increases.   It appears I’m not alone.   Hopefully everybody else is getting a wage increase to pay for my price increase to pay for my wage increases.   

A close relative owns a Marina, and he is struggling.  He has a ton of work, he has his slips full, but the cost of getting and keeping reasonable labor has skyrocketed from $12 hour to well upwards of $20.  And he still doesn't have enough help.  Those labor costs are his biggest expense, and their doubling in 2 years has destroyed any chance at profitability.  He's getting older, and his comment to me was "I'm getting tired."  I think we're going to see another wave of business closures as the drastic increase in labor costs really hit home in the small businesses.  Especially things like restaurants, marinas, lawn services and the like.

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45 minutes ago, Grrr... said:

A close relative owns a Marina, and he is struggling.  He has a ton of work, he has his slips full, but the cost of getting and keeping reasonable labor has skyrocketed from $12 hour to well upwards of $20.  And he still doesn't have enough help.  Those labor costs are his biggest expense, and their doubling in 2 years has destroyed any chance at profitability.  He's getting older, and his comment to me was "I'm getting tired."  I think we're going to see another wave of business closures as the drastic increase in labor costs really hit home in the small businesses.  Especially things like restaurants, marinas, lawn services and the like.

$12 would get a teenage dockhand maybe, that is minimum wage here.

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We learning that these brilliant entrepreneurs and business mavens are not any smarter than average? He has seen rising wages for two years, you write, yet did nothing? Saw the minimum wage controversy and the election of a pro-labor politicians yet did nothing? The marina is full yet the rents was not raised? Why would this businessman prefer to screw workers rather than make the tenants with disposable income pay a fair and profitable rate?

Plus, one professional-level worker with fair compensation can likely do the work of 3 disinterested underpaid disillusioned serfs.

Time for all these entrepreneurs and farmers whinging on social media to move aside to let smart people run these things. Oh, and sell that new candy-ass pick-em-up truck they bought with their employee's wages.

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The CEO of a Fortune 500 could skip a bonus and provide a meaningful wage increase to the bottom 20% that do much of the actual work.    In a small business, that isn’t necessarily true.   I’m watching one fail because the boss thinks it should be.    He doesn’t want to work the equivalent of 2-3 jobs to make up for labor shortages, employee illness and a chaotic economy.    Rising wages are a good thing for the employees.    They are a better thing for robot salesmen.   They may not be so great for the little guy who lacks a venture capitalist and must actually break even every single year.    CoViD vacations and free money made things worse (for the people that weren’t entitled to either).   Yet the billionaires saw a huge windfall.  

How many shops are running slow or not accepting work?    My trailer got rear ended after launch,    The first shop ghosted me on an estimate.   I had to pay the second cash to get him to take the time,   After insurance wrote off the trailer Triad tells me they have a two month wait time.   That may be optimistic, since they still haven’t gotten around to sending me the contract and asking for a down payment.    I think they are having the same labor shortage everybody else is.   Their price jumped over 25% in five years.    

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2 hours ago, Grrr... said:

A close relative owns a Marina, and he is struggling.  He has a ton of work, he has his slips full, but the cost of getting and keeping reasonable labor has skyrocketed from $12 hour to well upwards of $20.  And he still doesn't have enough help.  Those labor costs are his biggest expense, and their doubling in 2 years has destroyed any chance at profitability.  He's getting older, and his comment to me was "I'm getting tired."  I think we're going to see another wave of business closures as the drastic increase in labor costs really hit home in the small businesses.  Especially things like restaurants, marinas, lawn services and the like.

Well, yes, but isn't it because there is a hot economy and there is a lot of demand for workers? Supply/Demand, it's the law.  

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Fuck 'em. This is how the weak are filtered out. Capitalist Darwinism. The wealthy shrug when it happens to the worker...crocodile tears when it hurts the quarterly results. Normally happens in recessions, but wage inflation seems to work too. Also demonstrates a failure of conservatism in their reluctance to accept change.

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1 hour ago, Borracho said:

We learning that these brilliant entrepreneurs and business mavens are not any smarter than average? He has seen rising wages for two years, you write, yet did nothing? Saw the minimum wage controversy and the election of a pro-labor politicians yet did nothing? The marina is full yet the rents was not raised? Why would this businessman prefer to screw workers rather than make the tenants with disposable income pay a fair and profitable rate?

Plus, one professional-level worker with fair compensation can likely do the work of 3 disinterested underpaid disillusioned serfs.

Time for all these entrepreneurs and farmers whinging on social media to move aside to let smart people run these things. Oh, and sell that new candy-ass pick-em-up truck they bought with their employee's wages.

The death of the middle class has never been so eloquently celebrated.    If you can’t afford a helicopter you don’t deserve a boat hauler.   If you don’t have a mega yacht you shouldn’t have a slip.    Trailer sailors need not radio, they can’t afford to come.     

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25 minutes ago, Lark said:

The CEO of a Fortune 500 could skip a bonus and provide a meaningful wage increase to the bottom 20% that do much of the actual work.    In a small business, that isn’t necessarily true.   I’m watching one fail because the boss thinks it should be.    He doesn’t want to work the equivalent of 2-3 jobs to make up for labor shortages,employee illness and a chaotic economy.    Rising wages are a good thing for the employees.    They are a better thing for robot salesmen.   They may not be so great for the little guy who lacks a venture capitalist and must actually break even every single year.    CoViD vacations and free money made things worse (for the people that weren’t entitled to either).   Yet the billionaires saw a huge windfall.  

How many shops are running slow or not accepting work?    My trailer got rear ended after launch,    The first shop ghosted me on an estimate.   I had to pay the second cash to get him to take the time,   After insurance wrote off the trailer Triad tells me they have a two month wait time.   That may be optimistic, since they still haven’t gotten around to sending me the contract and asking for a down payment.    I think they are having the same labor shortage everybody else is.   Their price jumped over 25% in five years.    

The cold hard fact is you don't have a viable business if the price you sell your goods and services for does not pay the wages of the workers you need to produce them. You can get away with it sometimes when times are hard and even skilled people are desperate. That time is not now.

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1 hour ago, jerseyguy said:

At $20+ an hour the best marina/boat dealer in town is unable to hire experienced techs.

WOW - colour me surprised!

What does he charge them out for? At my marina it's $130/hour.

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2 minutes ago, Lark said:

The death of the middle class has never been so eloquently celebrated.    If you can’t afford a helicopter you don’t deserve a boat hauler.   If you don’t have a mega yacht you shouldn’t have a slip.    Trailer sailors need not radio, they can’t afford to come.     

You got it totally backwards.  The situation we had was middle and upper class recreation being subsidized by workers making apparently about minimum wage at this marina. The business-owning class seems quite put out to actually pay people a decent wage. I have no right whatsoever for people to live in poverty working on boats and airplanes that I use for fun.

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Just now, kent_island_sailor said:

The cold hard fact is you don't have a viable business if the price you sell your goods and services for does not pay the wages of the workers you need to produce them. You can get away with it sometimes when times are hard and even skilled people are desperate. That time is not now.

That is true.   The other solution is inflation.   Test the elasticity of your market and see how many people got raises.   That is where we are now.

Remember, Darwin applies both ways,    If some can afford the more expensive service and the rest cannot, you don’t need as much expensive labor.   Who cares about the left behind.   Unfortunately not everybody chooses to cater exclusively to the rich.   There used to be a middle class.   

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1 minute ago, SloopJonB said:

WOW - colour me surprised!

What does he charge them out for? At my marina it's $130/hour.

$118 for skilled labor, less for grunt work. The salary comes with a decent benefit package including health insurance and an employer matched 401k.  

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Just now, jerseyguy said:

$118 for skilled labor, less for grunt work. The salary comes with a decent benefit package including health insurance and an employer matched 401k.  

At $118 the skilled staff should be getting a comp. package worth $59, not $20.

There's his problem right there.

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3 minutes ago, jerseyguy said:

$118 for skilled labor, less for grunt work. The salary comes with a decent benefit package including health insurance and an employer matched 401k.  

He should be paying about 25% of that, so $25or so an hour seems reasonable. When I was charging out $60 I paid about $16.

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3 minutes ago, kent_island_sailor said:

You got it totally backwards.  The situation we had was middle and upper class recreation being subsidized by workers making apparently about minimum wage at this marina. The business-owning class seems quite put out to actually pay people a decent wage. I have no right whatsoever for people to live in poverty working on boats and airplanes that I use for fun.

Look at the numbers.    The billionaires are doing well.     He can’t spend money fast enough, even if he pays the guys an honest wage to wax his extra yacht.   I think you are old enough to remember inflation, I do as a kid.   Dad worked for university and saw a relative wage decrease each year.    I actually gambled on fixed rate business debt, expecting inflation to come a decade ago.    Now that the debt is getting paid down, it’s finally here.
 

 Many are guilty of not adapting to the new economy that is on us.   Even my girlfriend, a skilled craftswoman making dentures, is on the brink of being replaced by a 3D printer.   Her corporate boss will make the profit, she will eventually  be replaced by a less skilled technician.   Walmart is experimenting with robots to replace floor managers, identifying price errors, mismarked shelves, and prioritizing which areas the employees should face or correct first to maximize profits.  CoViD has shown many white collar jobs can be done remotely by somebody in Mississippi.   Soon humans will only do those things too dangerous, too unpredictable, in places too wet or muddy to risk a robot.   

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1 hour ago, Borracho said:

We learning that these brilliant entrepreneurs and business mavens are not any smarter than average? He has seen rising wages for two years, you write, yet did nothing? Saw the minimum wage controversy and the election of a pro-labor politicians yet did nothing? The marina is full yet the rents was not raised? Why would this businessman prefer to screw workers rather than make the tenants with disposable income pay a fair and profitable rate?

Plus, one professional-level worker with fair compensation can likely do the work of 3 disinterested underpaid disillusioned serfs.

Time for all these entrepreneurs and farmers whinging on social media to move aside to let smart people run these things. Oh, and sell that new candy-ass pick-em-up truck they bought with their employee's wages.

Wow.  You might want to direct all that aggression elsewhere.  I never claimed anyone was a 'brilliant entrepreneurs and business maven'.  The business has been there for well over 100 years under the same ownership, through hard work, dedication, and a close connection with both his employees whom he works side by side with in the trenches, and his customers, many of which have been with his for nearly a lifetime.

*screwing* his workers isn't in the cards, and the wages he's paid have been more than adequate up till now.

Seriously.  Figure out your anger issues elsewhere.

I think a lot of people here are forgetting that not every where is New York, Califonia, or Seattle.  There is such a thing as rural American, and our pay scales are very much different when you get away from the high cost-of-living areas.  You can buy a 2 acre 1500 square foot house here for under $200k, and get a decent apartment for $700 a month.  Kids still work for $10-$15 bucks an hour and $20 an hour around here is a living wage.

All that said, my point that the CHANGES in the going rates are going to hit people across the country regardless of what rates they are starting at right now.  It's going to have a ripple effect and that effect is going to hurt the companies that can least afford it - the small companies on tight budgets.  The problem is being exacerbated some by maintaining the unemployment benefits at high levels:  work is out there EVERYWHERE and there's little reason not to be able to go get a job.

In addition, we're going to see another housing crash in 5 or 6 years.  Prices are inflating again and people are panick buying, in many cases getting into bidding wars and paying well above what the homes are actually worth.  Once the interest rates rise some and the values fall, we're going to see a whole lot of upside-down loans like we have in the past and we'll see another round of people walking away from their houses and allowing foreclosures.

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2 minutes ago, Grrr... said:

Wow.  You might want to direct all that aggression elsewhere.  I never claimed anyone was a 'brilliant entrepreneurs and business maven'.  The business has been there for well over 100 years under the same ownership, through hard work, dedication, and a close connection with both him employees whom he works side by side with in the trenches, and his customers, many of which have been with his for nearly a lifetime.

*screwing* his workers isn't in the cards, and the wages he's paid have been more than adequate up till now.

Seriously.  Figure out your anger issues elsewhere.

$12 is "adequate" for kids grabbing docklines and pumping gas for tips, but no adult could possibly live on that.

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8 minutes ago, kent_island_sailor said:

$12 is "adequate" for kids grabbing docklines and pumping gas for tips, but no adult could possibly live on that.

Where exactly did I say $12 was adequate for a living wage?  Jesus, there's a lot of straw-manning in this thread.  WTF.

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3 minutes ago, Grrr... said:

Wow.  You might want to direct all that aggression elsewhere.  I never claimed anyone was a 'brilliant entrepreneurs and business maven'.  The business has been there for well over 100 years under the same ownership, through hard work, dedication, and a close connection with both him employees whom he works side by side with in the trenches, and his customers, many of which have been with his for nearly a lifetime.

*screwing* his workers isn't in the cards, and the wages he's paid have been more than adequate up till now.

Seriously.  Figure out your anger issues elsewhere.

Lots of angles to that issue.  Marinas tend to be where? The waterfront you say? Florida had to pass an amendment to protect working waterfront from being valued at its highest and best use if we didn't want to see the Farnsworths building shitty condos to pack people as close together as possible so we could be like they are up north. That wasn't done soon enough to save any of the old family-run boatyards in Ft. Lauderdale. Now the corporate yards, with a couple of exceptions, really just want to see mega yachts, and sailors can gtfo. In other areas, it has saved some working waterfront. Whether they survive wage spikes remains to be seen. The megayacht yards will...and who is more entitled to the joys of the seas than the Farnsworths? 

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Just now, Sol Rosenberg said:

Lots of angles to that issue.  Marinas tend to be where? The waterfront you say? Florida had to pass an amendment to protect working waterfront from being valued at its highest and best use if we didn't want to see the Farnsworths building shitty condos to pack people as close together as possible so we could be like they are up north. That wasn't done soon enough to save any of the old family-run boatyards in Ft. Lauderdale. Now the corporate yards, with a couple of exceptions, really just want to see mega yachts, and sailors can gtfo. In other areas, it has saved some working waterfront. Whether they survive wage spikes remains to be seen. The megayacht yards will...and who is more entitled to the joys of the seas than the Farnsworths? 

Yeah - bit of a different environment up here.  Especially when you've owned the land for such a long time.  It helps that it's been paid off for 100 years.  Mega yachts aren't really a thing around here - most of the rivers and canals just don't have the room, and no billionaire wants to visit when his boat is under a foot of snow =).  The VAST majority of the boats around here are 30=-ish feet.  The depth is the most limiting factor.

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1 minute ago, Grrr... said:

Yeah - bit of a different environment up here.  Especially when you've owned the land for such a long time.  It helps that it's been paid off for 100 years.  Mega yachts aren't really a thing around here - most of the rivers and canals just don't have the room, and no billionaire wants to visit when his boat is under a foot of snow =).  The VAST majority of the boats around here are 30=-ish feet.  The depth is the most limiting factor.

Good. You're safe from it. We are two up in the N. end of the state, on the St. John's River. There's a little yard here doing great, and the only time it is very busy is when a hurricane is approaching. We have another storm on the way in the form of people displaced by coastal development moving our way. Wages aren't going up here but property values are....  

Inflation will be interesting to watch as time marches on, but I struggle to square that with the less than stellar employment numbers last month. I would think we would see jobs spiking a good bit more. 

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2 minutes ago, Sol Rosenberg said:

Good. You're safe from it. We are two up in the N. end of the state, on the St. John's River. There's a little yard here doing great, and the only time it is very busy is when a hurricane is approaching. We have another storm on the way in the form of people displaced by coastal development moving our way. Wages aren't going up here but property values are....  

Inflation will be interesting to watch as time marches on, but I struggle to square that with the less than stellar employment numbers last month. I would think we would see jobs spiking a good bit more. 

I don't understand the jobs thing at all.  Right now, our campany has over 360 internal postings, and everywhere I look are signs requested skilled and unskilled help, from machinists and electricians to lawn mowers and fast food workers.

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27 minutes ago, Grrr... said:

Wow.  You might want to direct all that aggression elsewhere.  I never claimed anyone was a 'brilliant entrepreneurs and business maven'.  The business has been there for well over 100 years under the same ownership, through hard work, dedication, and a close connection with both his employees whom he works side by side with in the trenches, and his customers, many of which have been with his for nearly a lifetime.

*screwing* his workers isn't in the cards, and the wages he's paid have been more than adequate up till now.

Seriously.  Figure out your anger issues elsewhere.

I think a lot of people here are forgetting that not every where is New York, Califonia, or Seattle.  There is such a thing as rural American, and our pay scales are very much different when you get away from the high cost-of-living areas.  You can buy a 2 acre 1500 square foot house here for under $200k, and get a decent apartment for $700 a month.  Kids still work for $10-$15 bucks an hour and $20 an hour around here is a living wage.

All that said, my point that the CHANGES in the going rates are going to hit people across the country regardless of what rates they are starting at right now.  It's going to have a ripple effect and that effect is going to hurt the companies that can least afford it - the small companies on tight budgets.  The problem is being exacerbated some by maintaining the unemployment benefits at high levels:  work is out there EVERYWHERE and there's little reason not to be able to go get a job.

In addition, we're going to see another housing crash in 5 or 6 years.  Prices are inflating again and people are panick buying, in many cases getting into bidding wars and paying well above what the homes are actually worth.  Once the interest rates rise some and the values fall, we're going to see a whole lot of upside-down loans like we have in the past and we'll see another round of people walking away from their houses and allowing foreclosures.

I'm not angry. Almost laughing. Interesting how the capitalist class gets ruffled when they experience competition. This upheaval may provide a nice cleaning-out of all the capitalist slackers who have been lulled into complacency by the mountains of disposable income in the upper classes.

WTF - Raise the marina rates. Sell it to someone who will. Find a new job. Whatever. 

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6 minutes ago, Grrr... said:

I don't understand the jobs thing at all.  Right now, our campany has over 360 internal postings, and everywhere I look are signs requested skilled and unskilled help, from machinists and electricians to lawn mowers and fast food workers.

The virus has to be playing a role. I would like to see a breakdown of the numbers of people who think it is a hoax and just go about their business as they have all along, think it is real but don't do vaccines, think it is real but won't do this vaccine because of the 5g thing, etc. I am close with someone who "isn't ready for the vaccine yet" but is worried about getting the virus. I think there may be more people in her group than we realize, but that is a WAG.  

All of it is bringing me closer to the cut-the-benefits position. Announce a deadline after which unused vaccines get shipped wherever they are needed and benefits end. The Best Americans did just fine in the last year, and will be able to wait until a starving workforce is desperate enough to work for whatever they want to pay (i.e. back to normal pre-pandemic situation). Middle class business owners will find suitable workers again. 

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19 minutes ago, Grrr... said:

Where exactly did I say $12 was adequate for a living wage?  Jesus, there's a lot of straw-manning in this thread.  WTF.

"but the cost of getting and keeping reasonable labor has skyrocketed from $12 hour to well upwards of $20. "

If you are talking about say from 1980 to now this is a reasonable statement, but if this is anytime in recent history any kind of labor besides teenagers would have to be quite desperate to work for $12.

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17 minutes ago, Grrr... said:

I don't understand the jobs thing at all.  Right now, our campany has over 360 internal postings, and everywhere I look are signs requested skilled and unskilled help, from machinists and electricians to lawn mowers and fast food workers.

IMHO we are going to see a lot of strife between those for whom Covid translated into more money and those who lost out. SOME jobs are going begging and SOME people can't find jobs, but obviously these two groups are not matching up.

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How many people in their twenties who were struggling to be independent moved in with their parents or just decided to drive around living out of a van during the pandemic? My son was supporting himself with two jobs out in San Diego while working on his Masters degree. Work went away during the pandemic, and so he moved back in here. After seeing what it was like to actually have free time again, he is not interested in two jobs so he can pay $1500 rent for an apt that is smaller than the space he has here. Several of his friends in similar situations did similar things and are not interested in returning to the struggle to exist that they had before. I don't have any data to show that this is a significant factor nationwide, but I suspect it is at least a non-trivial contributing factor if not a primary factor.

Rents for apts in NYC are now cheaper than they are in the suburbs, almost half as much, while the rents and home prices in the suburbs are being driven up. This tends to indicate a bigger shift and one which removing or reducing the unemployment benefits would not solve. My son for instance is not getting any UC benefits and still has no intention of taking on two low paying jobs again. 

I have no doubt that the benefits are having some impact, but that is not the whole story. For a few decades we have labeled many of these jobs as unskilled and treated the folks who work in them with little respect and little pay. It should not be surprising if a year away from the cycle of trying to survive has given many of them a different perspective on the type of life they want for themselves. It will be disruptive, but I think this has been coming for a long time and the pandemic was simply the thing which pushed it over the edge.

Once you figure out how to live for a year without working two low paying jobs, you might just decide that you prefer doing that over returning to "normal". 

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31 minutes ago, kent_island_sailor said:

"but the cost of getting and keeping reasonable labor has skyrocketed from $12 hour to well upwards of $20. "

If you are talking about say from 1980 to now this is a reasonable statement, but if this is anytime in recent history any kind of labor besides teenagers would have to be quite desperate to work for $12.

I haven’t noticed any liberals giving credit to Trump.    His white militias enforcing an anti immigration platform had to have some affect on the cost of semiskilled and unskilled labor,     I don’t employ this category, but it has to have some impact on all the help wanted signs I see.

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37 minutes ago, Borracho said:

I'm not angry. Almost laughing. Interesting how the capitalist class gets ruffled when they experience competition. This upheaval may provide a nice cleaning-out of all the capitalist slackers who have been lulled into complacency by the mountains of disposable income in the upper classes.

WTF - Raise the marina rates. Sell it to someone who will. Find a new job. Whatever. 

Laughing because a long time business owner mentioned that he isn't finding labor at the same rates he did just one year ago?  Calling that being 'ruffled'?

Jesus.  You really do seem to have an issue.  You've made up this mental picture and are just randomly filling in the blanks.

We had a fucking friendly conversation and he mentioned it.  I was relating it here, and I'm sure many other people have seen the same thing.  Just.... wow.  There's something wrong with you and the way you're acting right now.  Put your shirt back on and stop trying to act like the freakin' hulk.

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10 minutes ago, Borracho said:

Wait...let me check the old talking points advice to starving employees: Better yourselves. Get a valuable skill. Bootstraps. Any others profit making advice to our beleaguered marina operator?

WHAT is wrong with you?  Ahhhh. My bad.  I just realized I'm in political anarchy, not general anarchy, and some people around here think it's their responsibility to just act like an asshole.

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43 minutes ago, kent_island_sailor said:

"but the cost of getting and keeping reasonable labor has skyrocketed from $12 hour to well upwards of $20. "

If you are talking about say from 1980 to now this is a reasonable statement, but if this is anytime in recent history any kind of labor besides teenagers would have to be quite desperate to work for $12.

Most of the labor in a boat yard is highly unskilled.  Go tie that boat up.  Throw that lumber on the trailor when I lift this boat.  Make sure that boat is plugged into shore power, etc.  The handful of highly skilled folks he has are quite happy - 20+ year employees who could make their own way in the boat repair / painting and yard business if they felt like it.  But those are the few employees, and it's the low-tier unskilled folks where he's having the most difficulty getting workers, and frankly they are the ones who do the majority of the work (like anywhere else).

He's slowly raising pay rates to entice new folks, but it's certainly squeezing the bottom line:  the last thing he wants to do it raise the slip rates for customers who have been there forever.  The difference between years ago and now is the change in the rates - before it was a gradual increase, but Covid has caused a step function.

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41 minutes ago, kent_island_sailor said:

IMHO we are going to see a lot of strife between those for whom Covid translated into more money and those who lost out. SOME jobs are going begging and SOME people can't find jobs, but obviously these two groups are not matching up.

That's true.  I've long wished our unemployment system focused more on trades and vocational education.

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1 minute ago, Grrr... said:

Most of the labor in a boat yard is highly unskilled.  Go tie that boat up.  Throw that lumber on the trailor when I lift this boat.  Make sure that boat is plugged into shore power, etc.  The handful of highly skilled folks he has are quite happy - 20+ year employees who could make their own way in the boat repair / painting and yard business if they felt like it.  But those are the few employees, and it's the low-tier unskilled folks where he's having the most difficulty getting workers, and frankly they are the ones who do the majority of the work (like anywhere else).

He's slowly raising pay rates to entice new folks, but it's certainly squeezing the bottom line:  the last thing he wants to do it raise the slip rates for customers who have been there forever.

Our moorage has been going up 5% a year for the last decade, sadly. Anyone who hasn't raised their rates "forever" is stuck with a big increase now just to stay even.

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Just now, Ishmael said:

Our moorage has been going up 5% a year for the last decade, sadly. Anyone who hasn't raised their rates "forever" is stuck with a big increase now just to stay even.

Ouch.  I couldn't afford a boat if that was the case around here.  $3k yearly for slip and storage is my sweet point.

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1 minute ago, Grrr... said:

Most of the labor in a boat yard is highly unskilled.  Go tie that boat up.  Throw that lumber on the trailor when I lift this boat.  Make sure that boat is plugged into shore power, etc.  The handful of highly skilled folks he has are quite happy - 20+ year employees who could make their own way in the boat repair / painting and yard business if they felt like it.  But those are the few employees, and it's the low-tier unskilled folks where he's having the most difficulty getting workers, and frankly they are the ones who do the majority of the work (like anywhere else).

He's slowly raising pay rates to entice new folks, but it's certainly squeezing the bottom line:  the last thing he wants to do it raise the slip rates for customers who have been there forever.

But as Kent explained, if the slip owners can’t afford the 25% price increase my trailer saw, their own business model is clearly screwed.    If they work for the state, historically slower to adapt to inflation, they get what they deserve.   

 

1 minute ago, Ishmael said:

Our moorage has been going up 5% a year for the last decade, sadly. Anyone who hasn't raised their rates "forever" is stuck with a big increase now just to stay even.

So real inflation is 5%, not the CPI fiction.      

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1 minute ago, Grrr... said:

Ouch.  I couldn't afford a boat if that was the case around here.  $3k yearly for slip and storage is my sweet point.

One of the reasons it's so expensive is that there is usually no "storage" involved and so people move here for the 12 months of subtropical weather and of course they buy boats, and many Americans keep their boats here because it's cheaper and/or nicer than Seattle. The big American motor yachts were the reason our marina just did a total revamp to fit in a bunch of 72'ers and take out a lot of 16' slips that the fishermen weren't renting any more because it was so expensive...etc. 

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5 minutes ago, Lark said:

But as Kent explained, if the slip owners can’t afford the 25% price increase my trailer saw, their own business model is clearly screwed.    If they work for the state, historically slower to adapt to inflation, they get what they deserve.   

 

So real inflation is 5%, not the CPI fiction.      

Asset inflation (and Marina Rent is on an asset) is definitely higher than 1-2%....

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4 minutes ago, Lark said:

But as Kent explained, if the slip owners can’t afford the 25% price increase my trailer saw, their own business model is clearly screwed.    If they work for the state, historically slower to adapt to inflation, they get what they deserve.   

 

So real inflation is 5%, not the CPI fiction.      

Our moorage inflation is 5%. Our housing inflation is probably twice that. Cost of municipal services has gone up appreciably as well, and beef is stupidly expensive now. Pork is dirt cheap. Depends on what you look at. 

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7 minutes ago, Grrr... said:

WHAT is wrong with you?  Ahhhh. My bad.  I just realized I'm in political anarchy, not general anarchy, and some people around here think it's their responsibility to just act like an asshole.

Triggered much? I'm not making any personal attacks like your posts. Only calmly offering my opinion.

One TikTok asparagus farmer thinks the border wall needs to be more welcoming. My guess is they didn't recently vote that way. Other rentiers seem to think the government should doing more vocational training to assure cheap labor. My guess is they didn't recently vote that way. 

Whatever does your marina operator friend do when fuel prices jump? Eat the difference or adjust the pump? Same thing, no? 

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1 hour ago, Grrr... said:

Most of the labor in a boat yard is highly unskilled.  Go tie that boat up.  Throw that lumber on the trailor when I lift this boat.  Make sure that boat is plugged into shore power, etc.  The handful of highly skilled folks he has are quite happy - 20+ year employees who could make their own way in the boat repair / painting and yard business if they felt like it.  But those are the few employees, and it's the low-tier unskilled folks where he's having the most difficulty getting workers, and frankly they are the ones who do the majority of the work (like anywhere else).

He's slowly raising pay rates to entice new folks, but it's certainly squeezing the bottom line:  the last thing he wants to do it raise the slip rates for customers who have been there forever.  The difference between years ago and now is the change in the rates - before it was a gradual increase, but Covid has caused a step function.

I will disagree. I didn't have much use for totally unskilled labor back in the day, the amount of damage one moron could do to expensive boats in one day was very high. One attempt at hiring a cheap idiot resulted in said idiot taking off leaving someone all the way up a mast with no way to get down until he shouted long enough to attract some random guy to lower him :rolleyes:

Also I have noted the old days when people fixed boats and airplanes because they loved being around boats and airplanes is no longer. There always used to be a few dudes working well below their potential earnings because they loved hanging out on boats. Also some useless hippies, but I digress. Back when boatyard rates were $60/HR and cars were $80/hr I was getting bills for $30/hr from the airport. Of course the parts weren't cheap, but the labor was. I guess they all loved it and/or were getting their time in before applying over at United. That is LONG GONE now!

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