Okay, so Krugman explains where the spectacular GDP growth mainly came from:
- final demand excluding the increase in stocks actually grew faster than
GDP.
- housing grew at a 20 percent rate
- spending on consumer durables rose at a 27 percent rate last quarter.
- consumers take advantage of
Jurriaan Bendien wrote:
This is very a similar story to New Zealand and many other developed
capitalist countries. No wonder that we are dealing with jobless growth !!
But a socialist would need to ask: who is actually doing the spending ?
Which social classes are buying houses and durables ? How
Here's what I'm curious about: I buy a house for 300,000. Within five
years, the house is valued at 500,000 (not unusual in the Bay area); now
I re-finance. Is my collateral based on the portion of the 300,000 I
have paid off? Or is it based on the revised market value of the house?
Joanna
Doug
, October 31, 2003 12:42 PM
To: [EMAIL PROTECTED]
Subject: Re: [PEN-L] PK on GDP surge - what could a socialist say ?
Here's what I'm curious about: I buy a house for 300,000. Within five
years, the house is valued at 500,000 (not unusual in the Bay
area); now
I re-finance. Is my
PROTECTED] http://bellarmine.lmu.edu/~jdevine
-Original Message-
From: joanna bujes [mailto:[EMAIL PROTECTED]
Sent: Friday, October 31, 2003 12:42 PM
To: [EMAIL PROTECTED]
Subject: Re: [PEN-L] PK on GDP surge - what could a socialist say ?
Here's what I'm curious about: I buy a house
Devine, James wrote:
it's based on the expected future market value of the
house, which is mostly based on its current market value.
And you can borrow against your equity! It's a money machine.
://bellarmine.lmu.edu/~jdevine
-Original Message-
From: joanna bujes [mailto:[EMAIL PROTECTED]
Sent: Friday, October 31, 2003 12:52 PM
To: [EMAIL PROTECTED]
Subject: Re: [PEN-L] PK on GDP surge - what could a socialist say ?
That's what I suspected...but, just to make sure, doesn't
Okay Doug,
A major prop to consumption in the U.S. over the last 2-3 years has
been home equity withdrawals - borrowing against the appreciated
value of owner-occupied housing. Since 68% of U.S. households own
their dwellings, your definition of propertied would have to be
rather broad.
Jurriaan Bendien wrote:
Same in Holland, same in Australasia, same in many European countries. In
the 1990s you had the hot air bubble and now they're breeding. But now you
have to explain why people would do that, under what conditions they would
borrow against inflated property values.
Jurriaan Bendien wrote:
Presumably, they would do that only
if for example they were sure that they had job security, or if they gained
a rise in pay, and so on. And that cuts out a lot of people already, because
we know there is a lot of job insecurity.
No. It's not a rational thing. Until
No, in fact, rental prices in the Bay area are dropping. To get an apt
in the building in which I live, you practically had to inherit it. For
the last nine months we've had three vacancies, and they're not renting
because the prices are too high.
Joanna
Doug Henwood wrote:
Jurriaan Bendien
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