economics

Warehousing

The leftists in NY state are blaming landlords for refusing to rent out apartments under the terms of rent control, and when they do rent them out, they fail to pay to maintain and renovate them. Landlords claim that the 2019 rent restrictions make it more cost-effective to keep an apartment vacant by keeping rents too low to cover the cost of repairs.

When a government enacts any sort of price control, they are setting the price at which a given product or service must be sold. If that price isn’t high enough to entice those who provide the product or service to sell, then there won’t be any available at that price. That’s why price controls don’t work.

That is true for anything that can be bought or sold- whether it’s widgets, oil, generators, or even housing. That’s what rent is- a person who can afford to purchase residential property buys that property, then rents it out at a profit to someone who can’t afford to purchase that property for whatever reason.

If a local government then sets the rent that may be charged for a residential property and that price is not sufficient to cover the cost of purchasing, maintaining, and administering the property, then there is no point in renting it out. This article paints landlords to look like they are hoarding because they are refusing to rent out apartments at the same rates that they were rented out for 20 years ago. It also attempts to blame landlords for not maintaining the apartments at these absurdly low rates.

Normally I wouldn’t care what happens in New York. They made the mess, they can deal with it. The problem here is that the idea is gaining traction in Central Florida. The Orlando area has managed to put rent control on the ballot. While I am not in the area affected by this measure, there are indications that it may catch on.

By Divemedic, ago

Food Deserts are Racist

So-called food deserts. The Democrat claim is that low income neighborhoods have few places to buy food, and this is because stores are racist. Of course, that is complete bullshit. The real problem looks just like this:

Higher income neighborhoods don’t do this. White neighborhoods largely don’t do this (exceptions being places like California and other liberal strongholds that have decriminalized theft). If you are stealing the food markets blind, they will have no choice but to close.

By Divemedic, ago

Shortages

Last month, I mentioned that the hospital where I work is bringing Philippino nurses in to fill vacant positions for less money than hiring Americans. There is more news on that front.

We have been short staffed for nearly three years. They have made up the shortfall by paying huge bonuses to get nurses to work extra shifts. They tried foreign workers. Still, they don’t have enough. Determined to save money now that the COVID funding has dried up, hospital administration announced on Saturday that there will be no more bonuses offered. Once the shifts that are already promised bonuses are paid out, they will be no more. Nurses who were making $2500 a day for working a 12 hour over time shift are now being asked to work the same overtime hours, but for $600-$900 each 12 hour shift.

I know that I was working 60 hours or more a week. I was making good money to do that, but now that the money has dried up, I am not working those kinds of hours for a fraction of the pay. No one that I know is willing to do that.

So now the entire staff of the ED is not taking any extra shifts. They are working their contracted hours, and that is it. Me? My contract says that I have to work 4 shifts a month. That is all I am doing. Everyone else is doing the same. So now the hospital is even more short handed.

Here is what was texted out to us this morning by the ED department head:

Hello team
We know this week has definitely had its ups and downs already and we appreciate all the hard work done by everyone. While we all fight this same battle we still have patients who are expecting the best care we can provide.
Starting tonight through the weekend we could use anyone on any shift to assist your fellow team and patients.
Please any help is appreciated.

As if guilt tripping us will get us to work all of those extra hours for a third of what we were making before. I want to help my patients and coworkers, but at the end of the day, this is a financial arrangement. It’s business.

So now the hospital is getting desperate. A third of the ED beds were shut down today for lack of staff.

The hospital where I work can only fill itself to somewhere near 60% capacity because they don’t have enough nurses, and that was when people were working extra shifts for bonus money. That means that patients often stay in the ED until there is an open bed on the inpatient floors. Our ED is frequently more than half filled with patients on “admission holds” awaiting beds. Couple that with the fact that the ED is also short nurses, and you have a problem.

Picture a 50 bed emergency room. To staff a 50 bed ED takes 14 nurses, 4 paramedics, 4 general technicians, 3 doctors, a nurse practitioner or PA, a respiratory therapist, secretary, three registration clerks, two lab technicians, three radiology techs, and two janitors. Every shift.

Now picture that you only have enough nurses for 10 per shift. Now you can only handle 40 patients at a time instead of 50. Now also picture that you have 30 admit holds, taking up beds and waiting for an inpatient bed- some for more than 48 hours. Now you can only handle 10 patients because your staff is busy caring for holds. So the waiting room backs up.

This means you have people sitting in the waiting room for 4, 5, or even 6 hours as they wait for treatment. And all of that was happening before you cut off the bonus money.

Now instead of 60% staffed, you are more like 45% staffed. Instead of 10 nurses, you only have 7. Now picture that across the entire hospital. A 600 bed hospital with a 50 bed ED requires 100 nurses or more each shift. You only have 50 or 60. Now what do you do? There aren’t enough foreign workers to fill that many spots.

My hospital can’t be alone in this. Here is the warning: there is a potential collapse of health care coming. It takes 3 to 4 years to train a nurse to the point where they are licensed, and another 2 years or so for that nurse to be proficient enough in their job to staff an ED, even longer for places like the ICU.

By Divemedic, ago

Orange County Rent Controls

In Florida, enacting rent control isn’t easy. Landlords in Florida can’t raise rent during the term of the lease. My tenants sign a lease for a year, and the rent is laid out in the lease. That is the amount they pay for that year. When the lease is up, we can negotiate for another year, but that deal is separate from the year before.

To restrict the new lease, Florida statute 125.0103 is pretty explicit. There are a number of steps that have to be followed.

  1. The city has to declare a housing emergency. Such governing body makes and recites in such measure its findings establishing the existence in fact of a housing emergency so grave as to constitute a serious menace to the general public and that such controls are necessary and proper to eliminate such grave housing emergency.
  2. The city puts rent control on the ballot.
  3. The measure must be approved by a majority of the voters in that city.
  4. The rent control doesn’t apply to seasonal rentals or to “luxury rentals.” A luxury rental is defined as a rental that would have cost more than $250 in 1977. There is nothing in there about adjusting that amount for inflation, but even if a court does so, according to the US inflation calculator, that would today be a rent of $1,222. There are virtually no rentals for that amount.
  5. The rent control is only in effect for one year.
  6. To go for another year, the entire process has to be repeated.

Even so, Orange County decided to go for it back in April. In August, the county moved to include it in the next election. Yesterday, a judge approved the measure to be on the ballot in November. The judge ruled that the landlords who sued could not prove that they would suffer harm merely because the measure is on the ballot because the measure may not pass.

I imagine that it will pass. There are a lot more grifters than there are landlords, especially in blue Orange county. I couldn’t find the wording of the proposed rent control ordnance. I imagine that there will be court cases to decide the amounts, which rentals it will apply to, and more. This case will be an important one to watch, as it will have a HUGE effect on not just the Florida rental market, but the Florida residential real estate market as a whole.

By Divemedic, ago

Inflation and Rent

Biden made an ass of himself on the inflation topic on Tuesday. It turns out that inflation is running at over 8% for the sixth consecutive month, and that is just the understated official rate. The Fed is reportedly considering a full point increase in interest rates next week, the highest in 40 years.

It’s that time of year again. Time to begin looking at market adjustments for our rentals. We have decided that we are not going to rent out one of our rental properties any longer. We are going to sell it in a few months when the current lease runs out.

The second property is more profitable, and we are looking at adjustments. The market isn’t as tight as it was last year, with inventory of available rentals being a bit more than it was. Prices even stabilized a bit. The market can’t keep rising at 25% per year forever, I guess. Still, we held last year’s increase a bit because we didn’t want to get too pushy.

Because of Florida’s insurance issues, our insurance costs went up. Our taxes went up. Our other expenses are also rising.

That means the house we are currently renting out at $1,825 is far below market and is going to see a rent increase. Zillow rentals claims that the house can rent for $2,550, but that seems too high. The current market is running between $1.15 and $1.28 a square foot for comparable rentals, meaning that I could likely rent it out for $2,175 to $2,425.

Now I am not the kind of landlord who will screw over a good tenant. In three years, he has only been late on rent once. Still, fiscal and market conditions are what they are, so I think we are looking at setting rent at about $2,000 per month. I do need to eventually put new countertops into the place, and if the tenants insist upon that, then the rent will have to be increased closer to market, perhaps to $2,100.

In the meantime, everything you buy will continue to get more expensive.

By Divemedic, ago

Workforce Participation

Much ado is being made of the fact that unemployment claims are at a two month low. Biden will most assuredly make a big deal out of it. That number means little. What matters is the labor force participation rate. For July, that stands at 62.1 percent.

Back at the turn of the millennium, 66 percent of Americans were working. That number dropped during Obama’s Presidency, all the way to 62.8 percent by December of 2016.

Then Trump took over. By February of 2020, it had regained a quarter of what was lost and rebounded to 63.4. The left couldn’t have that, so enter the COVID shutdown. Now Biden is rejoicing as the labor force participation rate hovers at a level that is even less than Obama’s low.

By Divemedic, ago

Energy Prices Still Climbing

Natural gas prices were $2.50 per million BTUs when Joe Biden took office. Today, natural gas hit $10 per million BTUs. In Europe, it’s even worse- an incredible $79 per million BTUs, mostly because wind power in Europe is significantly underproducing.

If there is any economic indicator that has improved since Biden took office, I can’t find it.

By Divemedic, ago

Oil Reserves Update

Just less than a month ago, I warned that the strategic oil reserve was being destroyed by the Biden administration in a bid to force down gasoline and energy prices ahead of the midterm elections, and that the Biden family was personally profiting from the sale of our national reserves. The reserve is now down to 460,000 barrels.

Oil is selling at $100 per barrel as I type this, and gas prices are averaging $3.89 per gallon.

Just a week ago, Goldman Sachs was forecasting oil prices of $130 per barrel and gas prices of more than $5 per gallon by year’s end. These are the levels “at which we need to see sustained prices to eventually solve the market deficit,” said the company spokesman. Translated: prices for everything will be so high that demand will begin to drop off.

Except that isn’t where Sachs is stopping with their forecast. They are now forecasting that oil prices will continue to drop through the election, with a gradual rise to $125 per barrel by next summer. I wonder how accurate that will be, since 2020 saw them forecasting 2022’s oil prices to be $55 a barrel.

By Divemedic, ago

My parents were wrong

The Six Flags CEO is having to explain the decision to raise prices and eliminate discounts at the company’s parks, in light of the emerging fact that attendance is down by 22% since the decision was made. He said in a statement that the price increase was a result of the company’s problems with what he referred to as “rowdy teenagers.”

We realized that we had discounted too much and we were filling the park with the wrong kinds of customers. So, we only got the discounter or we became a day care center for teenagers. It was a cheap day care center for teenagers during breaks and the summers. So we began raising prices to reduce the numbers of rowdy teenagers running around.

By rowdy teenagers, he means groups of feral black teens who had bought discount tickets before running amok in the parks and beating the shit out of customers who were paying full price. The Six Flag parks were becoming areas that families were learning to avoid.

The Six Flags America, located just outside of DC in Maryland, hosted a Halloween event called “Fright Night.” It was attended by large groups of blacks that began vandalizing cars in the parking lot and attacking other customers by using mob violence tactics who were executing planned ambushes of young white girls. The local cops claim that they were searching for the perpetrator, but it’s nearly a year later and no arrests have been made.

A similar story in Six Flags Great America just outside of Chicago. Out of control blacks attacked a family for asking them to control their foul language around small children. They wound up beating a 12 year old girl and her parents.

We can’t be seen as racist, because not all black people are like that, or something. So let’s call criminal behavior, vandalizing property, and beating the shit out of people as being “rowdy.” Let’s refer to black adolescents as “teens” so no one will know we are talking about a violent race of criminals. It sure isn’t Norwegians or Canadians that are terrorizing the paying customers here.

On average, the black race is broken to the point that wherever blacks congregate, crime, violence, and poverty are more likely than places where they are not found. The only place where this is not true is in Hollywood. The only places where blacks in large numbers are successful doctors, lawyers, and other professionals are make believe- television and movies. It isn’t that the US is racist, so don’t go there. Name an economically successful black country. The only one I can think of is Wakanda, also make believe.

So back to Six Flags. As a result of increased pricing, the company said it has lost about 2 million season ticket holders who did not renew their membership over the past year. As a result, total revenue for the quarter decreased by 5% to $24 million, fueled by the the lower attendance and $5 million reduction in sponsorship revenues.

Once people realize that the reign of people who are annoying them is over, the family customers will return with their money. Until then:

  • Stay out of cities. Especially ones with high concentrations of blacks.
  • Avoid large congregations of blacks.
  • If you are in a place where you find yourself suddenly surrounded by large numbers of blacks, get the fuck out of there.
The answer, of course, is “NAGGERS.”

We keep being told to ignore the evidence. Don’t believe what you see with your own eyes. My parents pounded that into me day after day. I learned the hard way that this isn’t true. I no longer trust cops, blacks, or eat my vegetables. That last one may be the only one of the three where my parents were correct. The great melting pot is a fantasy.

By Divemedic, ago