London housing prices are outrageous.
“Since 1996, London led a worldwide boom in big city property prices,” says Yale economist Robert Shiller.
New York, Los Angeles, Paris, Shanghai, Vancouver — the world’s great cities became like luxury brands. When you said you lived in London, people knew what it meant — it was as if you carried a Gucci bag or wore a Hermes tie. You edged up the snob scale a little bit simply because you lived in a fashionable place. By contrast, if you said you lived in Chicago, you slipped a little. And if you admitted that you lived in Baltimore, they felt sorry for you.
“The trend towards metropolitan chic is unlikely to end soon,” says Shiller. But the bubble in housing prices may be peaking out. Here in London, the papers tell us that prices in the center of town are already beginning to stabilize…or sag.
Meanwhile, from Dallas comes news that house resales fell for the second month in a row.
And from Baltimore, the Sun reports that prices in the region rose 20.5% in the last year — and still seem to be going up!
“One out of four Americans struggles to pay his bills,” says a new study. The researchers wondered how families of four, living on less than $36,784 per year, got by. “Just barely,” was the answer.
The Houston Chronicle:
“‘One emergency — a broken-down car, rent increase or serious illness — can disrupt the families’ precarious equilibrium and plunge them into financial chaos,’ the report states.
“The nonpartisan report spotlights a growing disparity between low-wage earners and the educated skilled workers that U.S. businesses increasingly demand.
“Its release comes in the final weeks of a heated presidential campaign in which issues concerning low-income families largely have taken a back seat to those of the middle class and to worries about terrorism and the war in Iraq."
“What we haven’t come to grips with is how large this number of working low-income families is," said Brandon Roberts, co-author of Working Hard, Falling Short.
We went out to a guitar store to buy Henry a birthday present last weekend. Henry turned 14 in July, but we have been traveling so much we had not had time to buy him the guitar he wanted.
The music stores all seem to be located over by Place Pigalle, an area of bars and prostitutes. But besides those, there is little of interest. Last weekend, there must have been an important rugby or soccer match pitting the French against the Irish. By 5 p.m. on Friday evening, the bars were already overflowing with drunken Irish fans. They wore green jerseys and were singing, “Sail, bonny boat…” as we walked by.
Guitars come with many different brand names at the end of the neck. But inside the box, we noticed that almost all guitars under $400 were made in China. We bought an Ibanez acoustic for 189 euros. Made in China, of course. Nice instrument.
Our Pittsburgh correspondent, Byron King, comments on Jacques Derrida’s passing:
“Of course, Derrida and his philosophic snake oil was/is a pseudointellectual byproduct of an elastic currency and lack of a gold standard.
(Whoops…there I go, showing my inherent bias. Damn. I hate it when that happens…) But I shall go on…
“In a hard-money world where people had to work at a real job and earn a living by being productive, no one would have time for Derrida’s nihilistic deconstructionism. The nation would be at peace, because it could not afford to go to war. The citizens would be at work, because they could not afford to be idle. The children would be in school and learning real subjects, because they could not afford to grow up and be stupid. And the politicians would be in Washington and London, Harrisburg and Annapolis, making sure that things stayed that way, because they could not afford to get voted out of office for screwing it all up.”
Bill Bonner [send him mail] is the author, with Addison Wiggin, of Financial Reckoning Day: Surviving the Soft Depression of The 21st Century.