Just brainstorming here because I am just wondering what financial decision to make next, and I feel like I am turning into an economist here... I know conspiracy theories aren’t allowed, but just think critically with me. In terms of global economics, I want to ask this question thought possible credible threat theories. What does it do to asset allocation? I am having dreams trying to connect these dots. A few years ago, we conveniently had the pandemic, which fractured the supply chain. Last year, we had the bird flu, which, through the rumor mill, never really wasn’t an issue. So food cost intention pushed through the roof. Now, we have oil being fractured through war. This raises the question of what would have happened to stocks if this hadn’t occurred. I think what next possible credible threat theory? If credit is tight and people are living off of credit, what is being suppressed for economic benefit for the elite? Intentionally pushing prices higher for longer. Also, economically, I should really I ask AI, but I was hoping you all can help me brainstorm this theory. I just want to get ahead, tired of being left behind …..

As we discuss about how housing becomes a luxury in an economy thats diving into luxuries, I keep seeing everyone frame the problem as "renting vs buying". But for me, all I see is luxury rentals and the real comparison should be having your own housing vs living with family like they do in other countries that have great inequality. In practice thats what I see: more people living with parents/in-laws after marriage, living "in the basement" after college, etc. So why are we still comparing rent cost to mortgages, according to the Cantillon effect hasnt that become redundant?

Hi all - a bit off topic and curious on folks experiences out there. I've been thinking about single family home prices where the prices are strong and steadily increasing, mainly coastal cities. I've done a bit of number crunching, but really focused on looking around at the economy around me recently and talking to folks. I saw that some areas have markets that have generally gone from ~$250k in 2010, to ~$450k in 2019 to ~$800k for a typical B-Class single family home. I've had lots of conversations with people in all groups around major metro areas: young and living at home, younger millennial and stuck renting, elder millennial/young Xer home owner, boomers retiring in place et al. and one major takeaway I had was how many home owners are trapped in their homes, like Hotel California (you can check in any time you like, but you can never leave). Lots of these homeowners had steady income and bought these homes sometime between 2005-2019 and "couldn't afford their home now". I think these high price areas have a lot of people with mortgages that are significantly below current 1BDR rents in their area so they cannot leave. So it is not just the interest rate but they might not qualify for more debt if their salaries didn't rise as fast, or if they took on more debt like auto loans, credit card debt, wedding debt, etc. It seems to me the rents rose so fast and so high that it's frozen a whole generation into whatever living situation they had at the time, and I've been noticing the Cantillion observation that people do not work beyond their necessities. So they keep their day job because it pays the bills they have, and those people are getting frozen out, which in turn leads to a crash in sales. If that's the takeaway then do falling rates even matter if the potential sellers have nowhere else to go? Wont the prices be driven by the shrinking supply, and those prices rising raises rent demand, which raises rents? And if the problem is people frozen in their homes with lots of equity and growing 401ks, would mass job losses even bring the prices down or would those people continue to be frozen?

Spirit Airlines is facing bankruptcy, which aligns with Simon’s theory that the middle and lower classes don’t constitute the top 20% of consumers. I think discount companies like Spirit Airlines are likely to continue struggling and eventually go under. In contrast, big brands such as Amazon and Costco are expected to thrive by catering to the top 20% of consumers. Spirit Airlines’ bankruptcy serves as an example of this theory, highlighting the fact that companies targeting the middle and lower classes are not what helps the Fed’s monetary policy... When I think about investing in stocks, the only thing that comes to mind is health services catering to the aging baby boomers and millennials, as they are considered one of the largest generations. What are your thoughts. It appears that market experts are considering shorting puts as a promising opportunity for stock play… like spirit airlines…

Breaking down the current events through the lens of the Credible Threat Theory