EDITOR'S COMMENTS:
Let's face it the writing was on the proverbial wall back in 2020, yet governments on both sides of the border and elsewhere failed to do much about it. Recognizing that this CNBC News presentation applies largely to the American markets and rental housing; we have added videos to reflect similar concerns and facts that exist north of the border.
We are puzzled by the utter ineptitude and economic illiteracy existing at all levels of Canadian politics and government. An eight-year-old could do the rental cost arithmetic facing ordinary folks that escapes the capabilities and skills of those elected or appointed to well-paid, crony, nefarious positions.
For the record here are the keys numbers. Under minimum wages, with most folks working 40 hours weekly, they make about $600 dollars or say $500 after-tax a week. This calculates to $2,000 monthly while rents for one-bedrooms are surging past this threshold; leaving no funds available for food, clothing and other necessities.
It is unequivocally disgusting, appalling and inhuman.
Before we grab our pitch forks and storm the Bastille, or hand out the cake; we need to sit back and calmly reflect upon where does this all lead us?
What Ends Are in Sight?
Firstly, people will begin to recognize that we're living in unprecedented times with much of the collateral damage and economic suffering being directly attributed to the crony and incompetent officials elected and appointed to cushy positions over the years; and they exist far from the realities of their constituency.
Accountability thus must be brought to bear, because as A. Einstein wisely observed; those who create the problems cannot ever be expected to solve them.
We must therefore find modern and metaphoric ways to storm the Bastille, and accept no cake offerings along the way.
Secondly, listen and pay close attention to what the billionaire investor Ray Dalio, says in the video below. The problems we face are rooted in the deep global predicament and thus go beyond local constraints, resources and mathematical physics. We are living with the circumstances caused by 300 years of industrial plundering and exploitation of the planet.
Exponential population growth and similarly rapid resource depletion have left nothing in the cupboard for present and future generations, and hence support Dalio's and also Charlie Munger's infamous predictions of a dire and unprecedented global economic collapse that will leave many with absolutely nothing for themselves and their despairing families.
Perhaps the history of France will again repeat itself - as poverty, homelessness and famine dramatically take hold in so-called developed starving nations.
So again the time has come to...
Join Us.
MUNGER PREDICTS A TERRIBLE ECONOMIC COLLAPSE
- A surge in rental property evictions could have a domino effect on the broader housing market and economy, Tendayi Kapfidze, chief economist at LendingTree, told CNBC.
- “This really could be catastrophic, and it extends beyond just the rental industry” and could “affect the single-family housing market and the economy as a whole,” he said on “The Exchange.”
- Kapfidze called for the federal government to take action to halt evictions during the coronavirus pandemic and extend special unemployment benefits to prevent a further breakdown in the economy.
- CNBC VIDEO
- https://www.cnbc.com/video/2020/07/31/evictions-crisis-could-become-a-financial-crisis-tooaheres-how.html
The U.S. (and Canadian) economy will face great risk if lawmakers do not step up and stave off a looming, far-reaching eviction crisis, an economist with mortgage aggregator LendingTree told CNBC on Friday.
With eviction moratoriums lifting across the country, landlords could eventually default on mortgages and the coronavirus pandemic could worsen in the country if tens of millions of renters are put out of their homes in the midst of a tough economy, said Tendayi Kapfidze, chief economist at LendingTree.
“This really could be catastrophic, and it extends beyond just the rental industry,” he said in an interview on “The Exchange.” “It could actually affect the single-family housing market and the economy as a whole.”
Nearly 2-in-5 tenants across the country, particularly low-wage workers, are in danger of being served eviction notices, according to analysis from Stout Risius Ross, an investment consulting firm. People of color are especially vulnerable. While half of White renters project that they can cover rent, just more than a quarter of Black renters feel the same, according to the study.
Statewide holds on evictions have expired in more than 30 states and federal protections for renters, passed in March as part of the historic multitrillion-dollar CARES Act, have also lapsed. As unemployment continues to hover at extreme levels, as many as 40 million Americans are thought to be at risk of losing their homes in the middle of the global health crisis. That figure is four times greater than during the Great Recession.
EVICTION PROCESS IN ONTARIO
“That could lead to a decrease in home values, even in the owner-occupied market, and in every state and every city there’s a patchwork of different, you know, kind of laws that people are using. So, really, it’s necessary that we have a federal plan,” the economist said. “We need a federal plan to deal with this rental crisis or it’s going to get worse.”
The eviction crisis could be a boon, however, for eviction services, said Glenn Kelman, chief executive of real estate brokerage Redfin, in an appearance later Friday on “Closing Bell.” He is also hoping society will intervene in what he said could turn into a “social calamity.”
“If you look at the data right now, about 8% of mortgages are in forbearance. That’s the program that lets you defer a mortgage payment for about a year. In January, the delinquency rate was about 3%,” Kelman said. “Clearly, the people in the business of evicting folks out of apartments and houses, of handling delinquencies and foreclosures are anticipating a big 2021 and that’s one of the shoes that we’re really worried could drop next year.”
MILLIONS OF CANADIAN FAMILIES ARE SUFFERING FROM RENTAL UNAFFORDABLE COSTS
About 30 million people are believed to be collecting unemployment benefits as the U.S. economy attempts to recover from a recession-inducing lockdown. Meanwhile, the countrywide Covid-19 outbreak shows no signs of ebbing, as virus cases in the U.S. now top 4.5 million and deaths near 153,000, according to data compiled by Johns Hopkins University as of Friday afternoon.
While an extra $600 in weekly jobless benefits, on top of state unemployment insurance, funded by the federal government has helped workers keep their heads above water, the measure has now lapsed. Democratic and Republican lawmakers are at a standoff over whether to replenish those funds, either partially or in full.
The Republican-controlled Senate failed this week to pass a new coronavirus relief package that would have reduced the weekly federal unemployment pay from $600 to $200 and later transition the program to a partial wage replacement system. The chamber has since adjourned for the weekend.
In order to fend off a larger crisis, it is vital that Congress continue paying out additional unemployment benefits and implement a national moratorium on evictions as the economy rebounds, Kapfidze contended.
“It’s really tragic when you look at how well other countries have handled this crisis that the United States has failed so dismally. It’s sad,” he said. “People need a lot of help out there, or we’re all going to be in trouble.”
BE PREPARED
BILLIONAIRE INVESTOR, RAY DALIO, SEES A VIRTUAL FINANCIAL COLLAPSE
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