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Subject: Socialist Economics 101
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Socialist Economics 101

Chart of the Week #65

Lau Vegys

Aug 26

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If you needed proof that socialists don't understand economics, look no further than this tweet from Bernie Sanders.

Classic Bernie. Blame billionaires, demand more government spending, rinse and repeat. It's the same tired playbook he's been running for decades.

The housing crisis isn't caused by insufficient government "investment"—it's the direct result of government interference. Washington pours billions into HUD, where money disappears into bureaucratic black holes while zoning laws strangle supply.

Want affordable housing? Stop subsidizing it. Subsidies drive prices higher, not lower. Instead, slash the red tape, reform zoning laws, and let builders actually build. Oh, and stop printing money to inflate away everyone's purchasing power—but I'm not holding my breath on that one.

But here's where Bernie really outdoes himself. Check out the chart he posted to support his argument:

Source: X

Now, Bernie is trying to highlight a real problem. Housing affordability is crushing middle-class families across America. It's a legitimate crisis that deserves serious analysis.

Too bad he can't do serious analysis to save his political career.

This chart is an absolute disaster. Let me count the ways it's wrong.

First, he's comparing weekly wages to annual home prices. Weekly to annual. On the same chart. It's like comparing your lunch money to the GDP of France and wondering why the numbers look weird. The visual effect makes it appear that Americans earn essentially nothing while home prices soar into the stratosphere.

Second, even if we fixed the time period mismatch, using individual wages is fundamentally misleading. Houses aren't bought by solo twenty-somethings living in their parents' basements. They're purchased by households—typically dual-income families who've been the economic norm since the 1970s. Every mortgage calculator, every affordability metric, every lending standard is based on household income, not individual wages.

Frankly, he should fire whoever put this chart together—assuming they were hired in the first place. Socialists do have a soft spot for free labor from unpaid interns, after all.

So what would the actual story look like with proper data? I've gone ahead and created a corrected chart for you below.

When we compare apples to apples—median home prices to median household income, both annualized—we get a much more nuanced picture. Housing has indeed become less affordable, with the price-to-income ratio climbing from roughly 3.5 in 1984 to about 5.3 today. In other words, the typical American family now has to work much harder to afford the same home.

But notice something crucial: the steepest increases coincide precisely with periods of massive government intervention. The post-dot-com bubble recovery fueled by Fed easy money after 2001. The housing bubble inflated by government-backed mortgages and Fannie Mae shenanigans. The recent explosion driven by unprecedented monetary stimulus and COVID lockdown policies.

Every time Washington rides to the "rescue," housing becomes less affordable for ordinary Americans. Every. Single. Time.

Yet Bernie's solution is more of the same poison that created the problem. More spending. More subsidies. More government "investment." And more wealth redistribution (that discourages the very investment needed to increase housing supply).

Regards,

Lau Vegys

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Monday, August 25, 2025

Housing panic grips half of US cities as record price cuts send home values tumbling | Daily Mail Online

New Home Sales Drop 0.6 Percent from Bigger Upward Revision

New%20Home%20Sales%20Drop%200.6%20Percent%20from%20Bigger%20Upward%20Revision%20%u2013%20MishTalk

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Mortgage Gamble

https://www.businessinsider.com/homebuyers-mortgage-rate-buydown-points-real-estate-prices-2025-8

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Wednesday, August 20, 2025

Housing Market Cracks Widen: Top Siding Company Suffers Worst Stock Collapse In 50 Years | ZeroHedge

https://www.zerohedge.com/markets/housing-market-cracks-widen-top-siding-company-suffers-worst-stock-collapse-50-years

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https://youtu.be/MXxiP1dMdw8?si=U8t3Gc75mu7jQImm

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Watch "Housing demand just hit a 30-year low." on YouTube

https://youtu.be/AJS9X1SBbsA?si=oSGOZbHiPNx9sKUd

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The Globe and Mail: Rental apartment construction was supposed to fix Canada’s housing crisis, but developers are struggling - and the pain is spreading

https://www.theglobeandmail.com/business/article-rental-apartment-construction-housing-developers-riocan-fitzrovia/

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Wednesday, August 13, 2025

Buyers win big as US housing prices start to drop | Watch

Thursday, August 7, 2025

ca.finance.yahoo.com: Greater Toronto housing market sees best July in four years: real estate board

https://ca.finance.yahoo.com/news/greater-toronto-housing-market-sees-090003400.html

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Saturday, August 2, 2025

Yahoo Finance: California homeowner with Farmers Insurance got hit with a 381% premium hike — is there anything she can do about it?

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Thursday, July 31, 2025

Yahoo.co: Housing market might need a mindset shift, not another Bank of Canada rate cut, say experts

https://ca.finance.yahoo.com/news/housing-market-might-need-a-mindset-shift-not-another-bank-of-canada-rate-cut-say-experts-142734885.html

Sent from Pixel

Wednesday, July 30, 2025

Watch "Americans Are Being FORCED to Sell Their Homes Right Now" on YouTube

https://youtu.be/8UHr9M-pQeo?si=GKukrpoPEOjSDoQt

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Monday, July 28, 2025

Storeys: Canada’s Housing Market Is Trapped In A Dangerous Triangle

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Victoria News: Housing Strategy: Victoria on track to add 6,000 homes by this year

https://www.vicnews.com/local-news/housing-strategy-victoria-on-track-to-add-6000-homes-by-this-year-8155208

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Saturday, July 26, 2025

NPR: Home sales are down. So why are prices at an all-time high?

https://www.npr.org/2025/07/26/nx-s1-5478757/home-price-record-mortgage-rates

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New York Post: Hamptons housing crunch forcing even wealthy buyers to settle for less-glamorous LI spot — where sales are surging

I thought you'd be interested in this story

Hamptons housing crunch forcing even wealthy buyers to settle for less-glamorous LI spot — where sales are surging

https://nypost.com/2025/07/25/real-estate/long-islands-north-fork-sees-surging-home-sales?utm_source=gmail&utm_campaign=android_nyp

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To download our apps, visit http://nypost.com/mobile-apps

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Friday, July 25, 2025

The Globe and Mail: Troubled Vancouver luxury tower project shows flaws in housing policy

https://www.theglobeandmail.com/real-estate/vancouver/article-vancouver-curv-luxury-tower-project/

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Thursday, July 24, 2025

Wolf Street: Single-Family Home Sales Drop Below 1995, Supply Highest since 2016. Condo Sales at Low in the Data, Supply at Housing Bust Level

https://wolfstreet.com/2025/07/23/single-family-home-sales-drop-below-1995-supply-highest-since-2016-condo-sales-at-low-in-the-data-supply-at-housing-bust-level/

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Home sales declined in June as prices hit new all-time high

https://finance.yahoo.com/news/home-sales-declined-in-june-as-prices-hit-new-all-time-high-144708979.html

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Wednesday, July 23, 2025

San Francisco Chronicle: This Bay Area city is the fourth-most ‘impossibly unaffordable’ place on Earth

https://www.sfchronicle.com/personal-finance/article/san-jose-silicon-valley-20780996.php

Sent from Pixel

Tuesday, July 22, 2025

Trump Considering Eliminating Capital Gains Tax On Houses | ZeroHedge

https://www.zerohedge.com/political/trump-considering-eliminating-capital-gains-tax-houses

Sent from Pixel

Saturday, July 19, 2025

Post from Fast Company (@FastCompany)

Fast Company (@FastCompany) posted at 3:20 AM on Sat, Jul 19, 2025:
Mark Zandi: "The housing downturn to date has been mostly about the depressed existing home sales. New home sales, housing completions, and house prices have held up well—that's about to change." https://t.co/TLmjCxOlno
(https://x.com/FastCompany/status/1946515406178353507?t=crVfRKKxKQezADP_ScHzGw&s=03)

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