The tiny house movement can’t do it.

Real markets were once a part of everyday life. When we lived in the context of a marketplace, prices were set in mutually beneficial exchanges by what people wanted and could afford. Today, instead we live with monopoly set prices that have destroyed market mechanisms that keep prices where they make sense. It isn’t a better life.

As financialization comes to an end, that is: the technique of making money through financial bets rather than by asset production, low interest loans are ending. That’s important because low interest loans enabled a huge amount of malinvestment and debt that seemed to stimulate economic gambling but that did not stimulate the production and accumulation of real wealth… only large quantities of capital.

What remains in the wake of financialization is a bunch of titanic monopolies and their attendant price distortions toward higher pricing. There’s also terrible corruption in government. This corruption has led to many problems in the justice system, the legislature and the executive branch, all three branches which remain stubbornly determined to subvert the rule of law and the vote in order to remain powerful in the face of the various disasters unfolding around us now.

There’s a lot of talk about higher ends through some high falutin sounding program that will make today’s suffering worthwhile in the distant future, but you should not believe any of it. There have never been beneficial goals for today’s covid 19 emergency or climate change or ESG or whatever to make any kind of real world sense except for them being indicative of a criminal mindset where some want to have everything that belongs to others and be responsible for nothing and no one. Most of what’s unfolding is just a really big heist with a bunch of empty excuses. Large wheels are still in motion. Watch out and don’t get ground down by them if you can help it.

There’s an Indian saying that a person or a lot of people can help an elephant to not fall down until it has finally lost its balance and is falling. In that case just get out of the way. The elephant is now falling.

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To return the discussion now to the tiny house movement, some people have tried to adjust to ridiculously high real estate prices by building according to the tiny house aesthetic. This movement suggests that regular houses cost too much and that ordinary people can get by with significantly less space. Instead of a house that’s 1500 to 2500 square feet, they can begin a new life in 300-700 square feet. It just requires a little sacrifice like less room for hobbies, or a family or pets or other activities. What the tiny house movement suggests to me, however, is that monopoly pricing in real estate has ruined the housing market for most of us. It shows that making ends meet can’t happen while monopolist pricing prevails.

Now we hear that the Federal Reserve must raise interest rates to protect the value of the dollar. Some say that this will cause a recession and that it is meant to reduce inflation by slowing down the economy. Raising interest rates will supposedly shrink down the bubbles in real estate and the stock market which are expected to fall in price as interest rates go up.

Some investors have thought that they can trade their stocks for real estate and then prevent real estate depreciation through corporate house ownership. The idea among investors is that deflation can be prevented and real estate assets can be substituted for financial assets because they have real value in the 3-D world rather than just symbolic value as in the money world. Monopolies in real estate can keep the prices high.

When the stock market falls, investors in this strategy think that they will retain the value of real estate assets they own. But financialization bubbles were blown in most of the economy during the flow of easy money. The high price of assets and capital has now led to demand destruction.

Raising interest rates to protect the dollar can’t slow down the economy where demand destruction has already happened and holding prices at an unreasonably high level will not save the economy from a deflation. Today’s inflation isn’t from an overheating economy. It is from money overprinting and overcirculation and it shows that MMT is a complete failure now as it has been throughout history. Demand destruction will only continue on apace.

Corporations buying into real estate doesn’t allow the asset market in real estate to recover a natural price according to the natural path of supply and demand that was followed with non-corporate home owners. Most people have been priced out of most ordinary sized properties. And the tiny house movement seems like a tiny segment of housing that won’t help to support the high price of the larger corporate owned homes that Americans were formerly accustomed to buying. As the tiny house movement is being portrayed on television, I can’t help but wonder if it signals the end of a consumer lifestyle. If home ownership means living with less that may signal less resilience among homeowners generally. Home buying may never lead Americans out of recession if Americans can’t afford to buy a property that allows them to grow more resilient over time.

Networks have spontaneity.

It seems that there’s a broad misunderstanding these days about networks and what a network can do based on the connections between elements in a network. Today a lot of people seem to want to form control networks instead of open networks. For example, cancel culture is about forming networks to exclude the participation of some potential members and to favor the participation of others. As soon as you do that you create a net instead of a network. That net is meant to trap some and block others. When you do that, you stop the network from growing to become whatever is needed.

In politics, the idea lately has been to promote participation by excluding some so that everyone knows that unless they pretend to believe in certain ideas, they will not be welcome to play any part whatever in what the network can accomplish. That seems like a terrible error that is unwise in the context of what happens in nature.

In nature, networks form spontaneously in an ever changing set of connections that come and go depending on what energy and opportunity there is to connect. Think about the way water behaves as a fluid substance because of weak and ever changing connections called Van der Waals forces. These are weak connections between H+ and OH- or hydrogen and hydroxide. These connections mean that water is wet. Van der Waals connections also mean that water can move into any space and fill it. Water can have surface tension because of weak forces. That’s what makes life on earth possible. Where would we be without water?

Among people, social connections that form spontaneously can also be extremely valuable. Instead of selecting people because of what they believe or don’t believe, or by some other trait, I think that it works better to allow connections to form between people to do something that needs doing. In our economy, an openness toward people who want to contribute is valuable. Too much emphasis today on using networks to control access leads to less participation and less energy and opportunity to do anything.

For example, getting an education that provides a basic set of skills and understanding can allow more people to participate in the economy than over-credentializing education into very narrow specialties. I’m amazed to see that a lot of employers expect people to pay for retraining when their basic skills already should allow a simple transition into another career in our quickly changing times. Today the average span of each job is so short that there’s a lot less return on investment for retraining. Wasting anyone’s ability to contribute, wastes what a more inclusive society can accomplish when more people can work together.

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