The Inflation No One is Talking About
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- Опубліковано 23 бер 2024
- Inflation has been high on the news agenda due to the cost of living crisis. When you see people talking about inflation they'll almost always be talking about the rising costs of things you buy in the shops, which is retail price inflation or consumer price inflation. But what about asset price inflation? Assets have been going up for years, and faster than goods and services, so why is that rarely mentioned?
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Performed by Gary Stevenson
@garyseconomics
The only American who won't acknowledge this Administration's failed economic policies is Joe Biden. "Shrink-flation' is the least of our worries compared to rising rents and stagnant wages, but it is an undeniable indicator of how bad our inflation has gotten. I have $100k that i like to invest in a non-retirement account, any advice on that?
I would avoid index funds, mutual funds, and specific stocks for the time being. Right now, the best option is a fixed income of five percent. Put money aside for the times when the market really starts to bounce back.
45% of Americans do not invest in the stock market because of lack of guidance. Every year you don't invest, you are falling behind. I’m hitting numbers in the stock market I used to dream of… Going from $50k to $600k in my portfolio is surreal all thanks to insights from my financial advisor.
Impressive can you share more info?
Colleen Rose Mccaffery’’ is her name. She is regarded as a genius in her area and works for Empower Financial Services. She’s quite known in her field, look-her up.
Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.
I just want my money to keep outgrowing the inflation rate. That’s why I'm looking for companies now to invest my $120k savings. Just don't know strategies to employ to make significant gains
Choose quality stocks and follow them up. If you're not one for such complexities, hire a wealth manager to grow your money. I use the latter. Pulled in more than $46k in the last two months alone.
Having an investment advisor is the best way to go about the stock market right now. I used to depend on UA-cam videos but it wasn't working. I’ve been in touch with an advisor for a while now, and just last year, I made over 80% capital growth minus dividends.
I wouldn’t mind getting in touch with your advisor. In few years I will retire and my portfolio will definitely need some management.
*Jennifer Leigh Hickman* is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.
Thank you. I just checked her out on the web browser, She seems really proficient. I'll follow up with an email. Thanks for the lead.
Inflation hits people a lot harder than a crashing stock or housing market as it directly affects people's cost of living that people immediately feel the impact of. It's not surprising negative market sentiment is so high now. We really need help to survive in this Economy.
I think I could really use more guidance to navigate the market, it is completely overwhelming, I've liquidated most of my assets and I could really use some advice on what best to invest into.
Your best option if you are unfamiliar with the markets is to seek advice or help from a consultant or investing coach. I know it sounds simple or generic, but talking to a consultant helped me stay afloat in the market and increase my portfolio to roughly 65% since January. For me, it's the best method to enter the market right now.
please who is the consultant that assist you with your investment and if you don't mind, how do I get in touch with them?
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with “Tenley Megan Amerson” for the last five years or so, and her returns have been pretty much amazing.
House prices are the cost of living if you pay rent or a mortgage.
Gary, in this vid you mentioned a point I've not seen you use much - that the very rich tend to consume labour which helps them if wage growth is stifled - I think this is a powerful point that should be made more often.
Which is one reason the rich love mass immigration, and then handily it also fits with their luxury beliefs and the virtue signalling.
more people should read Marx
@@VictorKibalchichmore people should read full stop lol!
I always forget many of the viewers are British, anyway... My grandparents retired and moved down to Florida when I was young. The reason is because Florida has huge numbers of illegal workers to provide cheap services. Their wealth went a lot farther down there. Aka, they were wealthier because other people were poorer. For 1 person to be wealthy, someone else must be poor it seems like, it just depends on where that poor person is.
the point that rich people create businesses and companies and thus consume labour... this point is made and known well.
Something that has been worrying me for some time;-
Workers are paid so little that the government gives them Universal Credit, so the companies get cheap labour at less than market rate, the companies get tax breaks and then they get massive subsidies as well. As a result they are propped up by public money which enables them to make massive profits and give dividends to shareholders who make money for doing nothing. How do we break this cycle without destroying everything?
That's a really good point that hasn't struck me before. The fact that the government is having to effectively subsidise wages, rather than making sure they are enough for people to actually live on means they (and therefore we) are losing out twice! First in paying the UC and then the second time on the lost tax revenue that would be paid on a wage.
This sort of feels like it comes back to my other post about increasing the tax bands to give people back some spending power without helping the super rich. But in this case, linking it to reducing UC, to help reduce government debt.
genuinely don't think there is any way out of this, nor do I think this has happened by mistake. I think it's all planned, and going exactly how they want it.
@Shauniedale what you have described has been ramping up for decades at least.
To give it a name, governments facilitating corporations is called fascism.
@@dazasc3994 you are right, and that is so sad.
It’s like we have come over the crest of a hill and now we are accelerating down the other side. Yet the only people with control of the brakes are enjoying the wind in their hair too much to worry about the rocks at the bottom.
@@anthonygittins506 there are two things that I think should be done. First increase the tax rate on the wealthy, including the removal of tax avoidance schemes. Secondly raise the tax threshold, this would benefit the poor greatly and make little difference to the wealthy. There are many other things of course but that would help with the imbalance we have that is currently growing.
I am baffled that you have to state the obvious. It sticks out like a sore thumb even to an uneducated moron like me. Thanks for your work.
Education comes in many forms my friend, it doesn't need a piece of paper to prove intelligence.
I ended up only being able to concentrate on counting how many times he touches his face, that increases over time like inflation😊😂
do not underestimate the power of ignorance combined with power of years of bogus media economists pouring simplified and politicised formulas into the public (and beyond). It is so engrained into our heads that most people sings along the ideology of all those old school economists.
@@paulcoates3860Poor you, easily distracted. Listen to the message. It has more validity than Jeremy Hunt on BBC this morning and it hasn't cost the licence fee .
@@user-gg9mw3wh8s I like Gary and Piketty. The what is often apparent but they explain the how. And for that I am very grateful.
The fact housing is classed as an asset in itself is where we’ve got it all so wrong
I’m in Civil Litigation, lawyers love it when the judgement debtor has U.K. property as we can use it to force them to pay 😂
@@Liberty_Freedom_Brotherhoodvery funny.
Until the intention was to make the rich richer, then it hasn't gone wrong at all.
@@aehii2305where did the term Landlord come from. It’s always been about that
What is an asset? Essentially owning an asset is to own a thing that is essential for people in society to function. So that's why owning the spaces where people live is such a valuable asset. Everyone has to exist and live in a space. Next is to own the spaces where people make their living. Next is to own the essential things that people use every day. Any sort of fuel or power, the means to produce and distribute food, followed by other goods. Now that our economy is so dependent on virtual space to exchange value, then it's owning those spaces. That's why Varoufakis says Capitalism has morphed into a technofeudalism. Because so much value is placed in renting out the virtual spaces.
I still think Marx had it. You have to stop the very wealthy from owning those assets and make them publicly owned. Especially bank profits, if not publicly owned, bank profits should go into the public purse. The first thing to do , surely, is to make banks pay taxes on particular types of profits. Again, Gary, what is wrong with that?
20 odd years ago I was always wondering why Gordon Brown would say he was controlling inflation by keeping it at 2% yet house price inflation was in double digits every year! Everyone pays for housing in some form or fashion. Whether it be through rent, through a mortgage or even if your children and your parents are paying for it therefore giving you less pocket money.
It baffled me that it was acceptable not to include housing inflation in with the general inflation index.
And NO ONE called him on it in the press. And it’s been going on ever since.
If you ask most people the difference between standard of living in countries it’s literally the cost of housing. It’s the most important index in the western world esp. in the UK. And no one wants to officially factor it in. It’s Just plain ridiculous.
He was just carrying on what the Tories did wrt inflation. The decision to replace RPI with CPI was made in 96. But even RPI never included full housing costs. Apparently there is an index CPIH that includes both. But then when raising bank rates are your only weapon to fight inflation that directly counteracts those actions. It's a bit of a charade in many respects.
To be fair it's the Bank of England who creates CPI as the index they watch and then decide to target it. They could use a different index if they wanted to
House price was included once. The elite removed it though, so its by design.
@@uniteddreamerI saw somewhere (Sasha Yanshin utube I think) that even the inflation that includes housing doesn't actually include mortgage costs, it substitutes the equivalent cost of renting an equivalent house in for the mortgage costs
He played a very small role, for a limited amount of time. I'm surprised ppl bang on about him, he was powerless to stop anything, powerless to do anything.
Gary, l ABSOLUTELY love you!
You make economics understandable. ❤ As a 63-year-old mother who has worked hard ( like many others), it all makes sense. I've never been good at the more complex maths or stocks n shares ect; all i know is that i get nowhere.
Now, I've turned into a preacher who talks incessantly about Gary's Economics to all my friends ,haha!There's a grey tribe following you, Mr . Your like Robin Hood, except your not robbing from the rich to give to the poor because we all know that morally wrong. The bloody rich have got the AAA* in that one 😉. You are educating us instead, and I thank you for that. 🤓💕
Yes, I am part of that grey tribe following Gary's work.
I am a 68 year old Australian woman who has lived a simple lifestyle for 30 years now, after reading the iconic book Your Money or Your Life.
Gary there’s no other way to put it you’re an absolute legend. Thank you for all your work and keep at it.
I remember the first time I realized that RPI excludes asset inflation, thinking “wow - what a con”. It is the most absurd omission but, of course, it favours the rich and powerful to use this as the basis for public discourse. Well done for making a noise on this. More people need to understand this stuff.
UK house price adjusted for RPI has no upward trend over the last 20yrs.
@@jam99 everyone is as hard screwed as they possibly can be, so it cannot get any worse. That doesn’t mean it is good.
@@neilhawkes880 Oh, it can get a lot worse.
2009, interest rates went down to 0.5% when we should have taken the pain with a natural house price correction. Kicked the can down the road and here we are.
Coulda, shoulda, woulda.
I now find my self with a ridiculously valued house, with a very small mortgage. Happy am I? Nope, how are my children ever going to be able to afford a house.
Why do we celebrate huge house price rises? Our kids, and then our kids are affected, therefore society.
Thank you Gary. You’re getting people to think and discussing potential solutions. This will gain more momentum because you.
The weird thing is most ordinary people wish to move at some point and rapidly rising house prices results in an increasing cost to make this change. What good to you, as an ordinary home owner is that rise in value unless you want to use it as security for debt or you're down sizing of course but this is less common and also a relative priced exchange. Other than a loan to value ratio change, for most a very small steady rise in prices would be the most desirable state roughly in line with wage growth possibly slightly lower would be ideal.
Houses are for living in. We have been conditioned to see it as an investment
@@gsica2097you can blame Thatcher for that
Can't you just pass your house on to your kids?
What I’ve seen in my time is as soon as wages go up, The price of goods and services go up. It’s like a catch-22 mate. It seems like the goal of our government is to make sure financial freedom must never be attainable, and they will keep moving the goal posts to make sure of it.
Yes that is their intention. Gary doesn't tell you who controls the government which is quite sad as I'm sure he knows.
I remember the 1970s inflation, prices went up and then we fought for wage rises. The government and media always blamed wage demands.
@@toiletrollholder. The people who fund groups like the Tufton Street think-tanks, which supply 'advisors' to the government ministers. Thinly-veiled lobbyists who write policy positions, for government ministers to read in the House.
They are the asset owners, who benefit from policies like austerity, public-sector wage freezes, privatization of publicly-funded assets (which will then be cannibalized for profitable parts, and the less profitable areas sold back to the government to be revived...at taxpayer expense), subsidies for corporate enterprises, tax-breaks for the wealthy and corporations.
Because companies want to keep the same profit margins, regardless of prices. So if wages go up 10%, prices go up 10%, even if wages are only 50% of the costs. That adds, essentially 5% to the profits made by the companies. Current inflation is because of 3 things, high energy bills (which are now starting to drop), price gouging by companies and high interest rates
in answer to your question i think the next government it will be the israeli state under a guise called Labour Friends of Israel
we also have a really scum media contgrolled by right wing people like murdoch if we really want change the working class and the middle class needto work together
@@toiletrollholder
Brilliant channel love listening to you, cheers mate.
It drives me crazy that no news commentators or politicians talk about this stuff. They're so out of touch with the concerns of anybody under the age of 45.
They're not out of touch, it's very intentional. They are only there to spin a narrative, why would 'free news' be of any real help? Think about it...
Political campaigns are funded by large corporations, billionaires and other special interest groups. The end result is a government that doesn’t work for working class people. Take a closer look and you will see just how “out of touch” things have gotten.
Do u really think politicians with some of the best economists in the world dont talk about this because there out of touch with the average person.
I think that’s by design unfortunately
Its great to hear the economic truth but annoying politicians and media channels ignore your inflation analysis! Certainly more "affordable" homes need to be built using efficient modern construction methods (high quality prefabricated homes) to keep pace with demand.
Houses can be built far more cheaply. a) Building companies drip feed the market to keep their selling prices high b) Land bankers hoard land that has planning permission c) A big part of the demand side of the equation is bank lending, the more they lend, the higher prices will go d) There is zero competition between Building companies and because of that there is no reason to modernise production methods, unlike cars and TVs for eg. e) There is little to no social housing avaliable to compete with the private rental market, a nasty market at that with few rights and obscene prices (compare this to the 1960s and 70s for eg) As for existing housing, all the world's richest people own prime real estate in the UK, why? Because we have almost the lowest property taxes in the world for expensive houses and estates, hence a no-brainer for the rich to keep an empty house in Chelsea for eg as opposed to the USA or any other financially safe country on earth, while at the same time we have some of the highest property taxes for the smallest and cheapest homes, including renters, in the world. All of these issues are governmental decisions and all can be rectified.
Looking into most (incumbent) top politicians’ own economy, most make quite a lot from ‘assets’ - including property.
Few of us would cut the branch we sit on - neither will owners of capital income.
This is way above electing Conservative or Labour, as capital and ditto economics are above (and ingrained into) any single government and institution across the OECD.
We get more of the same if we stick to our beliefs of “freedom” in the political economy - that’s what we have, ‘free = liberal’ more or less. There is no real freedom without an equal amount of responsibility.
Democracy as it is doesn’t reach into the “free” institutions of private banks or corporations, we are taught that it would be ‘inefficient’ and dangerously socialist…
So, we go for “freedom” of nationalism, then…?😅
We can 3D print houses now, building 24/7.
Fix land-banking by charging Council Tax from six/nine months after planning permission has been given, double it if it is unbuilt or unoccupied after a period of time.
Build upwards in cities.
Why is London a major capital city but with no residential skyscrapers ?
So many people want one or two bedroom homes, not the five bedroom executive homes currently being built.
The cost of money i.e interest rates is what sets house prices ultimately. If you want actually affordable housing then the value of existing homes needs to fall substantially. No political party will allow that tho.
@@Standard_Jay
But those house prices have been falsely over-inflated into a bubble.
Every bubble bursts sooner or later.
People who bought a home for £30k and now value it at £300k shouldn't be upset if it drops to £250k.
I'm more than happy to help those who bought more recently to stay out of negative equity, but as we bailed out the banks it wouldn't hurt for them to share some of the hit.
Excellent stuff Gary keep it going
Keep spreading the word Gary thank you
Great video Gary, I’ve almost finished your audiobook. Thanks for sharing your knowledge
I'm not surprised you are getting attacked Gary - you are providing straight-forward breakdowns of what the elites would like to keep unnecessarily complex. Keep up the good work.
Economics isn't difficult to understand, some people just think it is and bury their heads in the sand.
Top man Gary
This is something I have spoken about for years. The relationship between the essentials, wages and assets is out of balance. Despite recent RPi and CPI inflation this increase in the cost of goods and services has not kept up with asset prices, particularly property prices.This hass resulted in anyone buying property purely as a home have had to spend a greater part of their income on purchasing or renting a home leaving less for other items. This in turn has caused the other parts of the economy to contract resulting in companies going bust and job losses. If those left ask for higher wages then that can only be offset by more being charged for goods and services causing inflation. The additional wealth created flows back to the wealthy and they use it to buy assets which pushes up the cost of these including property.
RPI adjusted property prices are now what they were in about 2003. There has been no upward trend over the last 20yrs. Notice how Gary rarely shows graphs or statistics; just a narrative.
@@jam99they got rid of RPI because it revealed a more accurate picture of inflation.
Gary, you're a hero
Maybe. But follow his logic and he'll take you to zero.
How @@stevenfarrall3942?
@@stevenfarrall3942agree ... he is definitely a ballshit baffles brains guy 👍
Why
@@James-bc1jk my comment got deleted,🤣🤣 you will have to do your own research brother 👊
This is crystal clear, thank you. I'm really enjoying your book, too! 👏
Thanks Gary. That was very clear.
It seems to me people are opting out of work these days in the UK, People are asking themselves what's the point? Who can blame them?
Maybe that is the best way to get change? A sort of national strike.
Yep and my white collar coworkers are looking down on them calling them lazy
@@dandare1001 Maybe that'll happen when Labour win the next election.
Also, young people are opting out of having children - another way of going on strike - by refusing to feed innocent children to the capitalist machine. Mario Savio's speech seems prophetic,
“There is a time when the operation of the machine becomes so odious, makes you so sick at heart, that you can’t take part; you can’t even passively take part, and you’ve got to put your bodies upon the gears and upon the wheels, upon the levers, upon all the apparatus, and you’ve got to make it stop. And you’ve got to indicate to the people who run it, to the people who own it, that unless you’re free, the machine will be prevented from working at all!"
Gary is a hero. He is doing exactly this.
@@kw8757I bet labour brings in UBI
Just got your book Gary - keep up the good work
Thank you for making that clear. I'm gonna share this one!
Thank you Gary. Thank you for being you: unselfish, knowledgeable and a good human being.
The politicians know the solutions but they're all doing very nicely thank you very much #rentierism #landlords
these videos are so much more concise and well written than your older videos, well done mate
Gary and the comment section. Thank you so much for the content. This is essential discourse! So many of us are just ignorant to what is going on.
Remember talking to a banker in the late ‘80s about inflation and suggesting that housing prices should be included as they were increasing rapidly. He disagreed but of course the main people to benefit are the banking community that lend the money.
Congratulations on your book! Just finished listening to the audiobook version, and it was riveting. I'm going to recommend it to my book club. We'll done.
Problem is that those „rich and wealthy” are also decision makers - they don’t want to put wages up and lose cheap labor!
It's astounding how global this problem is and how relatable this is even in Singapore. Housing prices have soared to astronomical levels here compared to wages and it's really just a hidden salary cut for almost all workers since 2019. Meanwhile our government is gaslighting us with smaller and smaller public housing.
Most countries would be glad that your government provides public housing!
I really think you're onto something with this one - specifically the fact that ordinary people create goods and services (and assets), but asset holding essentially creates nothing, yet gives the owner tremendous market power. Adam Smith also recognised the hazard that this posed to the growth of productive wealth.
by extension, its the supply of housing thats the fundamental issue is it not?
Why would the older generation build more houses when not doing so pushes up the value of their homes and the rents they collect. It’s a grift
@gwills9337 because its progressive and good for all, not some. If that doesn't work for you. I wish you well.
@@kimberleyaxxxx934is supply really the solution? Wouldn't more houses be seen as more investment opportunity? We could never build a million houses a month or whatever to truly flood the market. Look at China. That's a massive over supply there as they are entire ghost cities. People buy apartments and never rent them out or live in them. A few years later they sell them. Supply isn't the problem. It's that house are an investment.
@@kimberleyaxxxx934 Nope, housing supply has always been constrained. What is different now is lending standards were allowed to be loosened e.g. there was no such thing as a buy-to-let mortgage before 1997, most property speculation happened on commercial property.
It would be great for you to go further on this. Specifically why the media and general economists think wage growth causes inflation and why they’ve got it wrong.
Great video as always. You have a brilliant way of simplifying things that tend to confuse.
PRICE inflation, WAGE inflation, ASSET inflation. Really good and straight-forward explanation. And, indeed, of concern. Thanks, David.
Thank you for your work!
Well done Gary - keep up the good work.
My wages in real terms as a public sector worker have fallen 20% since 2010. ... despite having more responsibility 😅 so they have probably fallen 45% if asset prices arr included...
Why stay in the public sector ? Successful people have several sources of income and these can be very simple and involve very little effort.
When white people lost there access to public sector jobs in South Africa they were scared, today they are much better off than they were under apartheid!
It turns out that the public sector jobs were very low productivity and thus they were forced to do more productive work.
Thank you so much for these videos. East London represent 🙌🏼
Gary, I hope you realise just how necessary you and your voice are.
I've said before, since scraping a pass at A-level economics many moons ago, but being heavily involved in finance for SMEs most of my working life, has allowed me to understand micro and macro economics.
However, though I've had plenty to say and discuss over the years, re wages, house prices, etc, nobody has ever put it in the relatively simple terms you do in this video.
Your voice and campaign is invaluable. As you've said, nothing will happen overnight, but if we can all spread this education, we might just be able to fight back and future generations might just have a better chance.
With you all the way mate!
Another good video dude - thanks
Thanks Gary.
Said clear and simple. thanks for getting the message across to lay people
Gary, loved the audio book. Touch of the Good Will Hunting going on and classy final paragraph that made me laugh and shout all at the same time. Appreciate you bringing your knowledge, expertise and life experience to bare in this way.
You’re gifted at explaining and revealing this so clearly. It seems so obvious but even armed with understanding and underpinning knowledge the next steps are opaque. I’m not sure there’s a political party with raising wages as a manifesto pledge, or even redistributing wealth via raises in UC. Lots of carers aren’t unionised. Foster carers and TA’s for example. Coming together collectively seems impossible without clear direction and signposting.
The ultra rich have bought our politicians to make public policy in their interests. Any political party opposing this hegemony will be vilified in the media (for whatever nonsense) until they fail - we saw this with Jeremy Corbyn.
love all your videos. You have opened my eyes on a couple things that I didnt realize, but this is one thing Im sure many young people are aware of. Price to earnings ratio of stock meaning replacing earnings in retirement is more expensive. Same with housing relative to wages. Its crazy that older people tend to deny this fact. Causes plummeting birth rates of course
Excellent stuff - this is a point I've often thought about - basically the cause of the 2008 crash (which is the root of nearly all our problems today). Well said - I shall be exploring your other videos
Loving the book Gary, really well written.
CPI and RPI don't measure inflation, they measure changes in price, which is a symptom of inflation.
Bingo
Keep spreading the truth Gary.
As well as a introducing a wealth tax, we need the introduction of an actual real living wage!
Marxism isn't the truth
Listening to this as I prepare for my economics exams for the MPhil at Oxford
Great explanation, thanks!
IMO the inflation numbers are deliberately manipulated to show a lower figure than they should. This obfuscates how the wealthy asset holders are getting richer, whilst also enabling politicians and business to justify minimal wage increases for ordinary people. I don’t see how they can maintain that inflation was below 2% PA for most of the 2010’s, when rents and property prices were going through the roof (pardon the pun) and making accommodation increasing unaffordable for the many.
RPI does include housing costs - just not the asset appreciation.
In a way that's correct, as the increase in value is a fantasy
Making ppl discuss economics is part of the blag. We pay them to manage the economy, in a good way. We don't pay them to blame us for their inability to be the managers we pay them to be. They just need them to do their job, not creates risks so they can stay in the job forever.
Agreed. My 5% 'payrise' that nurses got last year worked out at about 11% paycut for me. My largest ever paycut and 14th paycut in a row. Nurses salaries are down about 30% since 2008 and since then, houses have exploded in price. I will never ever come close to my parents or grandparents level of wealth despite me and my partner having better careers and working more hours
I always thought there should be a limit to the number of properties that can be owned by a person or private company
Love it Gary! A graph or two would go even further to simplify this for the lay :)
Really well explained. Thanks
Just finished the book Gary on audible - you are a great narrator it brought the book to life fantastic listen. Please do more tv work
Best book / audible I’ve listened to in years. Think I finished it in 4 days. Woke up with it and went to bed with it. Loved every second.
I’d love to put faces to the names.
Feel like I know all the characters
@@gossipmongersaunt774the frog! 🐸😂
Love to know what the Slug looked like
@@anncleverley4721 Rupert, kaleb, Bill… I feel like I know a Spengler. Tall, arrogant, loud South African twat 😂
These people must know exactly who these characters are / know it’s them
Gary for a long time I am a proponent of logarithmic real-estate tax. Say you own a flat, you pay real-estate tax, you own two flats you pay 10x the tax, 3 flats 100x tax. This would apply to individuals as well as fonds, and companies. What is your take of this in principal? (Obviously size etc would have to be defined in detail)
That does not help housing supply.
@@CCP_Operative yes it will, if you make it difficult for corporations and rich people to hoard houses by taxing them 1000x the homes won't magically disappear, they will be back in the market for normal people to buy at normal prices.
@manuelrapino5917 it will also obliterate mom and pop landlords who are already struggling I prefer those landlords over the corporate ones
@@alicia_nicolemom and pop landlords shouldnt exist. If you want to build wealth, create a business, dont leech onto other peoples labour by artificially inflating housing to pay for your cruise holidays in retirement.
@alicia_nicole how long do you think mom and pop owners will be with the trajectory of Economics and policies if this goes on. My proposal on the contrary will create more mom ans pops all the corporate owned estate will flush the market and prices will move down.
Thank you Gary.
as always, bless you for your work. as always, common sense is an uncommon virtue.
Spot on👍
Please keep repeating the message, Gary!
Fascinating analysis, spot on Gary
Unimpeachable insight as always, Gary!
Love to hear the truth from you, Gary!
Truly the man we need to save our country.
Thanks for your work and campaigning against wealth inequality!
There is always someone who has more than you, why waste time worrying about it when you can use it productively to improve your own life.
Good stuff Gary, great points on separating inflationary measures and the incentives of central banks not to fix the asset problem.
Great video again. Incredible that the system is so deliberately skewed in favour of the rich
Official measures of inflation have always been relatively useless to the average man on the street and outright misleading at worst.
When the current cost of living crisis started kicking off in the UK 3ish years ago. A poverty campaigner was in the news suggesting that there needs to be a separate inflation calculation looking at life's essentials as there are many products in the "basket of goods" used for inflation calculations that no struggling person would ever buy.
Sometime later I read an article/press release from one of the statistical agencies saying they'd looked into it and that food wasn't increasing any faster than general inflation.
I thought that's all well and good but it's hardly a surprise when we're living through the highest inflationary period in 30+ years.
So as whilst bored one day I figured I'd do a bit of self direct research on food inflation in the UK by comparing some records I had from when I was a student in 2005 and late 2023. What I found was that while the Bank of England's official number on inflation since that time was 75% many of the cheaper items that I had lived off as a student have increased by as much 200%.
That quite a large margin of error for anyone to take into account when planning their finances but is absolutely crippling for the many people living on low or fixed incomes.
Most sensible economics video I have ever seen on UA-cam. House prices in the U.K. are clearly far too high in comparison to wages. You can only fix that in 2 ways and 1 of those ways bankrupts anyone with a big mortgage…. So let wages inflate!!!
Absolutely love your work mate you should do an interview with David McWilliams.
Excellent explanation, which raises more questions than answers. Within every class of inflation there isn't just one rate of inflation as individual consumption levels differ.
The big difference is that CPI effects people on a daily basis and is therefore far more noticeable.
Gary, your argument missed one step: giving more money to the people won’t solve the problem if there’s no cap on how many residential properties people can own. Additionally, companies cannot be allowed to own residential properties as this will mask ownership.
The implementation of a cap needs to be introduced gradually in order to prevent a collapse. Eg in year a cap of 20 properties. Year two 19, year three 18, etc or something to this effect.
Housing investment also discourages investment into small / creative businesses that make or employ people. After all why invest in a business idea when you can buy and flip a house and guarantee a profit.
Housing is a guaranteed win , most businesses fail.
@@joannekelly5132 every big company was once a small company. Unless you try you will never know
I’m so grateful to be educated about economics in a way that makes sense and explain why and how this inequality of security and wealth happens. Thank you for your learning at LSE and Oxford, making your thesis available and sharing your knowledge. This act is righting wealth inequality which leads to can’t afford to be educated class.
Great video - really important points well made
Asset inflation is also driven by an ever increasing money supply, which is the central bank's responsibility as they set the Fractional Reserve percentage and they collude with corrupt, grifter politicians to implement QE. The asset class, which now includes most politicians, is closer to the money printers and they use the extra wealth created by the banks to buy assets. They know that holding central bank currency as a store of value will only make them poorer. It's the Cantillon Effect in plain sight.
Absolutely spot on. Gary ought to read Lyn Alden’s book ‘Broken Money’ to gain a better understanding.
More of circular than that.
Money is created by rising asset value. As an asset value goes up (particularly in an artificial bubble not driven by genuine value) that is new money created out of thin air.
But even worse, assets that go up tend to get sold more often. The purchasers buy it with bank loans, which also creates money out of thin air.
If the ultra wealthy own the asset they tend to take loans out secured by the asset, which also creates money out of thin air.
So large assets going up in value creates new money supply multiple ways, sometimes multiples of the actual asset value.
Some whine about government spending causing money supply increase, but in reality government spending is not the largest source of money supply, it is the cycle of asset value increase and bank loans with minimal bank reserve.
The money supply is destroyed with taxation, but of course we are reducing that too so not really solving the problem.
I would argue that the money supply affect on inflation is pretty small compared to the asset inflation affect on money supply.
@@5353Jumper I couldn't agree more, once you have an asset it is easy to exploit the capitalistic system and create money without the effort of labour.
THe problem is the wealth framework, what asset is more important than the other and under what terms are we defining the importance, output producing asset or money producing asset. Merely money producing asset always causes inflation, more 00s are attributed to it without an increase in marginal benefit
@@josiasnkwana9282you are conflating something which generates a positive cash flow with something that requires money printing (which is actually inflationary) we went hundreds of years with relative stable pricing until all the debasement and shenanigans occurred
Another amazing video
good video, thanks
Super video! One suggestion: never miss the opportunity to clarify what you mean by taxing the wealthy. People's adverse reaction to hearing about higher taxes cannot be overestimated, so it's important to reassure in the same breath almost no one watching this video is the intended target of higher taxes.
Thank you for being out in the trenches fighting for a better world.
Can you talk about what causes inflation and why asset inflation occurs? Perhaps a discussion about fiat currency? Something I think is an important talking point is that poor people tend to only hold fiat currency while the wealthy hold assets that outperform the currency in inflationary terms. What about backing the currency with assets to help to level the playing field?
Thank you for raising this important topic Gary.
Totally agree.
It may also be worth clarifying the basic calculation why asset inflation increases more than price and services.
If you look at various fundamental data, you see that the total amount of money has the strongest correlation with house prices. Because the amount of money determines the actual value of money. Not prices of products and services, as our central banks try to make us believe through misleading inflation figures.
Then the value of assets is basically constant while the price of assets adjusts according to the total amount of money available in the economy. While prices of products and services are mostly adjusted according to our wages.
The winners of this "lie" are, as Gary said, rich people and our government.
Well said !!!👍👍👍
Great work Gary. Would love to know your thoughts on the level of tax revenue lost through Private Equity and Family Funds owning so many UK companies and their corporate structures that allow legal tax avoidance. Frequently these are the organisations that own the elderly care services companies.
loving the book Gary, first one I've read in years!
It's a brilliant read. Made me cry in places laugh out loud on the Tube 😂
Thank you for giving me something to look in to. I didn’t even think about how asset prices rise! I thought everything rose at the same rate!
There are many types of assets, some appreciate over time, others don't, some require ongoing expenditure to main and improve their value, others don't.
Inflation for goods and services is much easier to understand and effects people on a daily basis.
Fantastic content and ideas - my two cents are to include pretty infographics - a picture paints a thousand words
Gary. I love the work that you are doing including the Trading Game that I am half way through. I feel that your great value to this debate is economic rather than political. I saw you in the UA-cam with the IEA. It was almost comical watching them squirm as they didn’t know what to do with you as you had protection from the neoliberals as you were an extremely successful FX trader. I fear this honeymoon period will not last. For me, for you to continue adding value you need to prevent the Tufton Street mob from labelling you as just another socialist by strenuously avoiding entering into political debates. In my view, if you can do that, you could become central in effecting the root and branch overhaul that the UK economy needs.
Another good video. Please do a video on why there are so many boarded up properties in our towns and cities that all say " To let".What's that all about?Surely investors want people in these buildings si why not drastically lower business rent, rates or sell?
Hi Gary....interesting video x
Hi Gary, loving the channel, the book and your journey. I've been following for over a year.
Just interested in your take on how much of an impact Airbnb is having on asset (housing) prices. People I listen to tend to mention it as a bit of an afterthought. Do you think it's been a significant contributor to the escalation in house prices over the last few years?
High prices for everything have severely affected my plan. I'm concerned if people who went through the 2008 financial crisis had an easier time than I am having now. The stock market is worrying me as my income has decreased, and I fear I won't have enough savings for retirement since I can't contribute as much as before.
It's recommended to save at least 20% of your income in a 401k. You can use online calculators to estimate how much you should save based on your age and income. Saving at least 20% of your income in a 401(k) can help ensure that you have enough money to retire comfortably. By saving this much, you can take advantage of investing in the stock market and potentially grow your retirement savings over time.
I’ve been down a ton, I’m only holding on so I can recoup, I really need help, who is this investment-adviser that guides you?
She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.
Inequality doesn’t in itself cause land price inflation (or asset)… But high land prices are inversely related to wages because high housing costs forces people to need to work longer, it’s forces a pseudo increase in the labour supply. If land was cheap wages would be higher because workers could afford not to work…
Also, worth considering that economy develops, industry becomes more efficient, goods become better and or cheaper; the central banks then target that (hedonics applied and multiply the effect) and cut rates in response pushing up asset & land prices. Because of the central bank cpi targeting regime any advances in the econmy benefit only the rich as economic surplus is captured in rental values…
Only Land Value Tax can stop this…
thank you for everythings.
This is exactly what has happened in Singapore over the past 15 years. They have policies that encourage wage inflation by incentivising business to pay existing staff more money - worth a look i think.
As the use of AI develops there will be less need for staff, existing staff will become a thing of the past.
Thanks again Gary for a great and informative video
I am totally on board with your views and ideas the problem I find is getting the average working person to engage with your theories because I am not an economist and I try to explain your theories people either switch off or worse they complain there is nothing they can do about the situation we all find ourselves..
The one thing I tell people is to back the people who try to do something about things
People like the Junior doctors or anyone who is prepared to go on strike for better wages and working conditions