Why Are High Housing Prices Good?

Have you ever read a news story like this?

“In other reports, sales gasoline rose in May, although prices continued to drop, according to the Petroleum Institute Sales rose 2 percent to a pace of 499 million gallons. The median sales price per gallon, however, fell to $3.75, down 6.3 percent from a year ago. That was the fifth biggest year-over-year price decline in records that go back to 1999. Many analysts think gasoline prices need to stop falling or start rising for the ailing petroleum market to get back its health.”

This is a slightly doctored version of the story below.

The Associated Press:
“In other reports, sales of previously owned homes nudged up in May, although prices continued to drop, the National Association of Realtors said. Sales rose 2 percent to a pace of 4.99 million units. The median sales price, however, fell to $208,600, down 6.3 percent from a year ago. That was the fifth biggest year-over-year price decline in records that go back to 1999. Many analysts think housing prices need to stop falling or start rising for the ailing housing market to get back its health.”

I hope prices of houses go up enough so I can afford to buy one.

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High prices are neither good nor bad

It depends upon if you are buying or selling.

The concept of prices and inflation is flawed. Money is only a conversion factor between the value of one's time and other assets or between other assets. I propose that goods be priced in terms of uph (universal person hours). 1 uph is the approx economic value of one healthy person plying one shovel for one hour. This is about the same world wide.

At the onset, one uph in every locality would be set to the minimum wage. A person earning twice the minimum wage would be paid 2 uph/hour. A gallon of gas would cost about a half uph.

And every little child would

And every little child would get a pony. Why not ?

Been There Done That

Labor based currencies based on units of time have been done before. Here on Long Island there have been several communities in the past that have tried this. Like communes they generally fail, or are just not all that popular. Like barter it's inefficient.

People just don't value an hour of a mime's time at the same rate as a hour of a prostitute's.

Uph . The plight of the one armed man.

I am not sure what your system would accomplish. There is no capitalization other than natural endowment. Dave

Maybe - labor IS capitol

(See below From WIKI)

Earlier illustrations often described capital as physical items, such as tools, buildings, and vehicles that are used in the production process. Since at least the 1960s economists have increasingly focused on broader forms of capital. For example, investment in skills and education can be viewed as building up human capital or knowledge capital, and investments in intellectual property can be viewed as building up intellectual capital. These terms lead to certain questions and controversies discussed in those articles. Human development theory describes human capital as being composed of distinct social, imitative and creative elements:
Social capital is the value of network trusting relationships between individuals in an economy.
Individual capital which is inherent in persons, protected by societies, and trades labor for trust or money. Close parallel concepts are 'talent', 'ingenuity', 'leadership', 'trained bodies', or 'innate skills' that cannot reliably be reproduced by using any combination of any of the others above. In traditional economic analysis individual capital is more usually called labour.
Further classifications of capital that have been used in various theoretical or applied uses include:
Financial capital which represents obligations, and is liquidated as money for trade, and owned by legal entities. It is in the form of capital assets, traded in financial markets. Its market value is not based on the historical accumulation of money invested but on the perception by the market of its expected revenues and of the risk entailed.
Natural capital which is inherent in ecologies and protected by communities to support life, e.g. a river which provides farms with water.
Infrastructural capital is non-natural support systems (e.g. clothing, shelter, roads, personal computers) that minimize need for new social trust, instruction, and natural resources. (Almost all of this is manufactured, leading to the older term manufactured capital, but some arises from interactions with natural capital, and so it makes more sense to describe it in terms of its appreciation/depreciation process, rather than its origin: much of natural capital grows back, infrastructural capital must be built and installed.)
In part as a result, separate literatures have developed to describe both natural capital and social capital.