Must Read: California Governor Gavin Newsom signed a rent control bill into law earlier this week to try to stem the state’s rapid increase in housing costs. This despite the fact that rent control is universally despised by economists across the political spectrum and almost never works in practice. Right on cue, landlords are planning on more consistent rent increases to keep up with the cap as well as stepping up no-fault evictions on below market tenants before the law fully goes into place in 2020.
Between a Rock and a Hard Place: With unemployment at historic lows, the Fed would normally be expected to be increasing rates in order to keep the it from overheating. However, anemic growth and stubbornly low wage gains are pressuring them to cut instead. See Also: For the Fed, unemployment is a lagging indicator. And: Earnings growth is actually pretty solid for low-wage workers – even though its stagnant at the high end – yet neither side of the political aisle seems to want to talk about it.
Bearing the Load: Goldman Sachs has found that the cost of US tariffs on Chinese goods has fallen “entirely” on American businesses and households, with a greater impact on consumer prices than previously expected.
Remote Work: People who telecommute or work from home now have higher incomes than those who don’t according to the Census Bureau.
Who Could Have Guessed? WeWork’s foray into building ownership via its purchase of the iconic Lord & Taylor building in NYC is turning into an overpriced debacle. See Also: Beyond the crazy self dealing and new-age yoga babble, potential WeWork investors were also turned off by it’s sloppy IPO filings, which were apparently riddled with errors. And: SoftBank’s CEO Masayoshi Son says that he’s ‘Embarrassed’ about his WeWork and Uber investments.
Built to Last: Compelling ROIs coupled with stability are attracting investors to medical real estate as the healthcare economy prepares for even more technological advances and a growing seniors population. See Also: Medical office buildings remain in demand among investors.
Overreach: San Francisco’s proposed 143% increase on office impact fees – intended to fund low income housing – could have such a negative impact on development in the city that it winds up being a fee on something that never gets built. Consider this a reminder that no one knows how to kill the golden goose quite like a coastal California city.
Reverse Psychology: Confidence in housing is weakening as homes become more affordable thanks mostly to employment concerns.
Help Wanted: 80% of contractors struggle to fill needed positions, lengthening construction timelines and driving up costs.
Still My Favorite Bubble: The Beanie Baby bubble is my all-time favorite mania and now there is a book about it.
Fountain of Youth: Having a dog can help you live longer according to a new study, because dogs are awesome.
Open for Business: Colorado is deregulating its cannabis industry to provide investment opportunities for publicly traded companies, venture capitalists and private equity firms, which were previously barred. This, combined with the potential to access banking service through the SAFE Banking Act- which has passed the House of Representatives – could be a game changer.
Chart of the Day
This is fascinating. Side note: If you’re not signed up to receive Scott Galloway’s weekly newsletter No Mercy / No Malice, you are doing it wrong.
Source: Section 4
Soft: A woman called the police after her friends tricked her into eating a chicken nugget because vegans.
Refreshing: Two men were arrested for catching an alligator and forcing it to drink beer because Florida (h/t Steve Sims)
Oops: A woman mistakenly called an undercover cop to plot her husband’s murder because Florida.
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