House Of Mirrors: Rent and The Housing Market

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Today, we rant about rent and the housing market. Like a fun house mirror without the fun, several housing-related forces are distorting economic activity. There’s the distortive way rent inflation is measured in the headline CPI; if the BLS’s new All Tenant Rent index were used instead, the Fed would be fighting too-low inflation! … There are the forces messing with supply and demand, depressing the supply of homes for sale (Baby Boomers aren’t moving) and elevating demand for rental units. … Housing affordability has suffered as a result, with home prices up 46% just since the lockdown ended. The good news is that new rental supply is ameliorating rent inflation.

[@amirmokari9973]

These charts and conversation is amazing but I find the cpi discussion a little misleading. What is concerning the market is the MoM CPI data, not the YoY. The annualized MoM is well over 4 so that’s the concern.

[@daveschmarder-1950]

Always a nice presentation. Thank you!

[@tmangeles7575]

Very interesting episode, Ed. Kudos!

[@CharlesPurvis-kg9oc]

What are these Videos pre-recorded?

[@chessdad182]

I think it is from Monday.

[@Rodviper88]

Yep he said in video it's April 22nd

[@CharlesPurvis-kg9oc]

Why does he put it out so late?

[@johnhiz6239]

$ to play, Capitalism! That’s why this is a great country. 4 days later is good enough for me. Thanks Ed

[@RaviSingh-iy1nl]

@@CharlesPurvis-kg9oc I believe this is from a paid service. If you pay you get it live.

[@kp2718]

Great point about PE!:)

[@fkeopfkeop]

How can the data be interpreted so different? Danielle Martino Booth says we are currently in an recession.

[@jimo5758]

Many thanks! Live long and prosper.

[@kp2718]

Can anyone explain to me this: if BB ratios are such good contrarian indicators, why people who are actively involved in the stock market as newsletter writers etc (those who constitute the II/AAII) themselves turn out to be so ignorant about them

[@kp2718]

I really can't believe how the audience here is so obsessed about small/mid vs big caps. It's the same question every week! I feel like those are very much wasted. Great respect to Dr Ed though obviously.

[@jimsmith8324]

Food costs have risen in a big way since Covid started. The Fed can't hide behind "volatility". Ok, it's volatile, but they should include it anyway and then make quarterly adjustments as necessary.

[@Long_Tail_of_Finance]

Any thoughts on the Silent Generation regarding their real estate holdings? Your chart lines are remarkably flat relative to the other generations.

[@thaddeus46]

Ed, you wish for peace in the Middle East but not in Ukraine/Russia? Puzzling.

[@Meishach2112]

Always a great presentation. Thank you. Cheers!