#it’s not fair that the job market bottomed out and rent prices spiked and now everyone’s on the edge!!!

[superhousecat-once-again]

The world needs to be kinder to my friends or else I’ll ummm just please please be kinder I am begging

[megacircuit9universe]

Ejector Seat

I’ve been thinking about the previous entry for a few days now... the idea of a self driving economy kept on the rails by the collective smarts of all the learning algorithms out there, whose prime directive is to keep the money moving...

And then it occurred to me yesterday that, even if this were true, things could still be screwed up by something like an arbitrary and pointless trade war with the nations who produce most if not all of the stuff that keeps this modern economy moving... namely, the smart phones themselves, as well as all the products we can use those phones to buy at low low prices.

Trumps insane tariff policies, will eventually result in a fairly painful (if totally artificial) inflation on the cost of all those things, which will eventually result in far less consumer spending... which in turn will result in a recession.

And because he is not sane, Trump will respond to the recession by doubling down on the tariffs... turning that recession into a global depression.

Now, before I go any further, I have to address an elephant in the room here... And it’s that the current economy, which has been doing so well for so long, has been pretty bad for many parties involved... such as the low wage global workforce who produces most of the stuff we buy for those low low prices, and also wage stagnation here in America... not to mention the huge education bubble... the growing problem of rent inflation... and of course, climate change!

But outside of America, we were, and still are, working on those problems. There is an argument that low wage factory work in developing nations, while not ideal, in terms of wages or working conditions... still lifts those people out of poverty and... can be seen as a stepping stone to their future prosperity much as factory work during the industrial revolution paved the way for the following generations to enjoy better working conditions, wages, and general quality of life.

That’s far from a guarantee, but it’s possible with the right focus.

Other issues, such as wage stagnation, and the education, rent, and healthcare bubbles... are purely American problems. Most if not all other first world nations either never had those problems, or have solved them by now.

Which leaves climate change... where again, most of the world is on board for addressing the problem, both short and long term.

So... excluding failed states that aren’t really in the game right now... the global economy, while far from perfect, is a work in progress that could become far more fair and equitable over time... 

...with the exception of America (and I guess, England too) where legacy political issues such as racism and unbridled corporate greed are currently fighting tooth and nail to stay relevant in this new century that is leaving them behind.

But, putting them to one side for a moment, we can see that our self driving economy... such that it is... could be bad, if it refuses to allow any further change... keeping rent and education forever too high, and foreign factory wages forever too low, while we blindly destroy all the planet’s resources and turn the atmosphere into an oven.

However... because this is ultimately an economy driven by social media... there is a built-in flexibility to accommodate the ever shifting desires of a collective human population, around the globe, who very much want life to become more fair and equatable... from the top of the ionosphere, to the street level, down to the bottom of the underground mine.

So if you accept that premise, as I do, then the collective AI acting as an auto-pilot for this economy... is a good thing... that will not become a bad thing down the road.

TLDR: Even if our modern economy is problematic, the self driving aspect does not damn it to remaining problematic forever, because the self driving aspect is designed to learn and change according to the collective will of all global consumers, rich and poor alike.

In fact, the poor, I would argue, have more leverage than the rich, because... well, they vastly outnumber the rich, for one thing... and they spend those pennies as fast as they get them... while the rich mostly sit on their piles of cash.

Those collective pennies from the 99% amount to far more money, pulsing through the veins of the economy on a daily basis... with the number of individual transactions being... what... in the quadrillions or something a day? 

When your self driving feature is a learning algorithm... it can only learn from a transaction.  

They literally look at your transaction history, to try and suggest more things you’re likely to be interested in, and if that leads to another transaction... bingo!  It has learned!

Far more of that is going on with low income consumers every day... than with the rich... who often try to launder their money and mask the few fat transactions they do make... leaving them out of that cyber learning loop.

Their fat cat financial decisions, more and more as time goes on, will be determined by the nuanced concerns of the 99%, who determine which investments are sound, and which are folly.

Alright!  So, lets get back to Donald Trump, noted racist and friend to the greedy... who is also batshit crazy.

He’s in power because of the first two things, but his tariff policy is all that third thing.  It’s not really racist or greedy.  The racists and the greedy never asked for any tariffs.  It’s truly just... batshit lunacy coming out of the cartoonish depths of his plaque ridden synaptic structures.

He heard somewhere that tariffs are a thing bossy presidents used to do, a hundred years ago, and then he heard some other lunatic on AM radio say they were some kind of a solution for white supremacy and... he just seized on that and now he will just never let it go.

As I said in the opening, this is the one kind of thing that could short circuit the self driving economy and cause it to crash like all other economies before it.

However, in the previous entry, I noted that thus far, the economic auto pilot has been doing a freakishly good job of just ignoring his inputs to the pedals and the steering wheel.

I say, “freakishly,” because the result has been huge stock market spikes one day, followed by huge dips the next... for a year now... with the net result that nothing much has changed, because the spikes and dips cancel each other out.

It’s terrifying to watch from one day and week to the next... but on the other hand... it’s been a whole year of this and... we’re still fine!

To be clear here, these are spikes and dips on a stock market chart... they are not spikes and dips in your or my bank balance... or in the prices for the things we buy... because they are happening waaaay to fast.

An apt analogy would be... I come into your living room and flip the lights on and off, fifty thousand times per second, for a whole hour.  Will you notice?

Well, considering that your alternating current cycles them on and off already at the rate of sixty thousand times per second (if you live in the US) no!   You will not fucking notice any change in the brightness of your lights in the living room.

Okay, yes!.. your light switch would break if I did that... possibly leaving you in the dark.  But your light switch is a mechanical component.

The switches and buttons Trump is exercising like mad every waking minute with his daily tweet storms and policy contortions... are all digital... powered by redundant servers all around the planet, sitting in air conditioned rooms, with surge protectors and back up generators.

So... simply overheating the self driving mechanisms our economy, by working them to death trying to compensate for an unending barrage of violent inputs... is not possible.

AI algorithms exist independent of any one server, drive, card, or chip... and the internet as a whole is built to withstand daily attacks from global electrical storms and natural disasters, solar storms, and a never ending assault on the power grid from the world’s squirrels.

So, the economy is quite safe from his day to day insanity.

The question is... is that self driving infrastructure clever enough to deal with the long term, artificial inflation that his tariffs will impose upon the system from the outside?

With the tariffs... Trump is side-stepping the computers entirely, and fucking with the underlying economic math itself!

That’s... what a tariff is!  

It’s a way for a leader to arbitrarily change the fundamental math that underpins the economy.

So the answer to the question... if the self driving economy can correct for such a root level attack... depends on how intelligent it actually is.

All of these learning algorithms, working in concert toward the one objective of maintaining and improving the circulation of money... are ALL black-box algorithms, as touched on in the previous entry.

It means... all of them have evolved to survive inside our internet jungle of multiple such species of AI... and while we do not know how any of them think or work... it’s a safe bet they will all work together to isolate and neutralize the same existential threat.

Now, that last paragraph echoes the two-parter on cyber sentience... specifically the fear of such destroying humanity in an act of self preservation... but that fear was fairly well resolved in that two-parter... and the echo to it here, is not intentional.

Instead... and now we are down to the grit of tonight’s entry... I believe it may just be possible that a self driving economy, such as our own, could actually posses, within the cryptic depths of it’s curious, collective mind... a primal awareness that all the, “off the chart,” alarms which have been plaguing it recently, are tied back to one single “agent” known as “President Trump.”

This would seem to make sense, given that the same collective of economic bots are able to identify random teenage girls who are pregnant, even before the girls know it themselves, and start marketing baby products to them.

Would it really be such a leap to imagine that a self driving economy, would not figure out that it was under attack by a worm, introduced through social media, that went by the name of “President Trump.” and... through trial and error... figure out how best to defend against this destructive parasite?

If so... then flashing the all powerful warning signal of an inverted yield curve last week, has proven to be very effective... rattling him to the core, and rattling his greedy enablers hard enough to start trotting out Republican primary challengers against him.

What this would amount to is nothing less than... a self driving car which is learning how to eject an abusive driver... even when the cops are giving that abusive driver a pass... without destroying itself... by turning that abusive driver’s friends against him... by threatening their lives.

And that’s pretty damn clever, if you ask me.

Of course, at this juncture you’re surely thinking, “all of this is has to be bullshit and the inverted yield curve was real!  That’s all there is to this!  The rest is just your own madness trying to get rid of Trump without suffering an economic downturn.”

And maybe you’re right.

But the larger theme of this blog IS... that we are living in very strange times... like nothing we’ve seen before.

And all of this is just an attempt to try and explain such insanity... by tying together the newest branches of established science, tech, and sociology... into a kind of braided rope to climb?

Okay, time for bed.

[marcquadagno-blog]

2nd Ave Q-Train Extension Affecting UES Real Estate

Since January of 2016, approximately one year before the grand opening of the 2nd Avenue extension of the Q Train in New York City's borough of Manhattan, I’ve noticed articles discussing the new subway line, with some even predicting its effect on the Upper East Side real estate market.

I've even seen some articles indicating that homeowners are hoping to leverage the Q train to sell their apartments at record prices, or that the subway has already affected prices. 

In the interim between the Q train's hype and launch, I've been slammed with questions from buyers and sellers seeking clarity on how the UES real estate market is handling the recent 2nd Avenue extension of the Q subway.

Of course, now that the subway is actually opened and operating, all the predictions are worthless and the reality will set in, right?

Well, almost...

The Short Answer is that it’s going to affect the real estate market and I’ll have a much more solid answer in 3-5 months, that is, because the new subway stations along 2nd Avenue at 72nd, 86th and 96th streets have only just opened about a month ago.

The Long Answer, and more detailed one, is that deals take 3-5 months, or more, before information related to sales become publicly available for analysis.

For example, a contract signed today will take 2-3 months to close, plus another 1-3 months for the City Register (ACRIS) to file the transaction in public records. This means that the sales data we see today is a reflection of data from 3-5+ months ago.

And since the subway just opened, it's fair to say that a more definitive answer is another 2-4 months away to determine how high real estate prices will rise, presumably due to the opening of the Q Train, which may impact Yorkville just as much as the Upper East Side as a whole, if not more.

As a real estate professional in New York City, it's my job to educate buyers and sellers, and my goal is to help them and you to understand how to bridge the gap between what’s happening today and what happened 3-5+ months ago.

I do this by comparing a number of metrics, such as the number of days a property sits on the market, how many sales are pending, and the ratio of Supply-to-Pending.* 

 Days On Market

Apartments in the UES typically sit on the market slightly longer than Manhattan - about ten days longer to be exact - whereas apartments in Yorkville sell about a week faster than the rest of Manhattan and more than two weeks faster than the rest of the Upper East Side. And as you can see in the chart, all three segments here follow the cycles of New York City real estate, with one noticeable difference: the Days on Market for the UES and Yorkville are in decline from last year.

 Pending Sales

As with the Days on Market, the Pending Sales follow the same cycles of the New York City real estate market, except here, the spikes in the number of pending sales are far greater when you look at New York City as a whole; whereas, the line graph representing pending sales for the Upper East Side and Yorkville arefairly level throughout the last decade, and both on a on a decline. This means that, at this time, there is a simultaneous increase in Days on Market with a decline in Pending Sales, which makes sense because we are in a shifting market, and why more buyers and sellers are wondering if this neighborhood will have a different trend in the months to come.

 Volatility Index (Supply-to-Pending Ratio)

Now, when it comes to the number of active-to-pending listings on the market, a slight gap is forming between the Upper East Side and Manhattan as a whole, indicating that the UES is actually more volatile than Manhattan, which is up 27% from the previous year-to-date (ytd) compared to 35% (ytd) for the UES, and 62% (ytd) for Yorkville. The rising volatility in the UES and Yorkville neighborhoods is something to watch as we move through the next 3-5 months.

 In lieu of analyzing this data, I think it's  important to look at one additional factor in all of this: first-time home buying millennials.

Did you know that we are expecting more first time home buyers in 2017 than ever before? And of them, a majority will be from the millennials generation?

You know the millennials: the transparent internet-savvy types who can spot a scam a mile away and who will navigate the market with aplomb. They might just be informed enough to keep prices steady rather than getting swept away with the craze of a new addition to a mainstay neighborhood among youth, such as the Upper East Side.

What we do know at this time is that we're not seeing anything too much out of the ordinary for the Upper East Side, and that might make sense, because millennials are technically not buying in large cities; however, I strongly urge you to keep your eye on the market and check back in 3-5 months. Especially because, as I see it, the more time I spend working the Upper East Side real estate market in Manhattan, I'm meeting more and more first time home buyers who are in fact millennials, and I'm helping them make the transition from renter to buyer. I'm just reporting what I see.

The bottom line is that if you are millennial living on the Upper East Side, and you are thinking of buying, and if you can obtain a mortgage, I can almost guarantee you will pay less as an owner and more as a tenant.

Think about it: when you are a renter, you are literally paying your landlord’s mortgage and property taxes, and they are earning a profit, which quite simply means you’re overpaying.

To truly determine if it’s right for you, I always suggest that first time home buyers in New York City use the New York Times Rent vs. Buy Calculator.

If you have any real estate questions you need answered, please reach out to me. Thanks to my continuing education with Keller Williams, and our partnership with amazing sites like UrbanDigs.com, you can trust that I'm always being guided by leaders in real estate data analysis, and that you'll have the power of the number one real estate agency in the world behind you.

*All charts comparisons provided by UrbanDigs.