This implies that the USD is going to remain useful as a store of value - for the real estate bubble to truly collapse, the price of a house in a metric other than dollars, for instance, cheeseburgers, has to decrease.
Where I live in Canada, I used to be able to get a double cheeseburger and a large coffee from McDonalds for $5. Small houses cost about $150,000 then. Now that same meal - which I rarely eat these days, because the quality has declined significantly and I don't want to patronize that establishment - costs $9, and would probably be $12 if the quality was kept up. Now the same houses cost $400,000. The house price has not changed much in cheeseburger terms - a house only costs about 11% more cheeseburgers and coffee than it used to, and that's using my imagined price where the cheeseburgers hadn't been debased along with the currency.
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branchandroot
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Date: 2024-05-19 01:54 am (UTC)Where I live in Canada, I used to be able to get a double cheeseburger and a large coffee from McDonalds for $5. Small houses cost about $150,000 then. Now that same meal - which I rarely eat these days, because the quality has declined significantly and I don't want to patronize that establishment - costs $9, and would probably be $12 if the quality was kept up. Now the same houses cost $400,000. The house price has not changed much in cheeseburger terms - a house only costs about 11% more cheeseburgers and coffee than it used to, and that's using my imagined price where the cheeseburgers hadn't been debased along with the currency.
Justin