You want to know why so many people can’t afford to buy a house? Why so many young people are stuck renting? Why neighborhoods are declining? Why what was once the best way for people to secure retirnement — buying their own home — is disappearing?
Good old fashioned American capitalism. Houses are being purchased en masse by huge private equity firms (do they improve lives for anyone, besides those private owners of the equity (capital)?) and turned into rentals.
Here’s some information from my favorite journalist, Matt Taibbi.
“… private equity companies like Cerberus Capital Management collecting over 34,000 homes in a fund, and getting set to buy more with the aid of financing like a $616 million loan deal struck with Morgan Stanley last November.
“Along with other (private equity) firms like Pretium Partners (70,000 homes as of late last year), Amherst Group (34,000), NexPoint (17,000), and Blackstone (17,000), these whales have been swallowing up real estate to join in the fun of being “institutional single-family renters.”
“Now, instead of handing a monthly check to a flesh-and-blood human being, more and more Americans will experience the joys of renting from bloodless conglomerates owned by expert value-extractors like Steve Schwarzman and Don Mullen, who are not merely inaccessible to complaints but whose corporeal existence has probably been moved to tax-exempt zones in the fourth dimension.
“…private equity firms just finished up their second monster year in a row, doing a record $1.2 trillion in deals in 2021 alone. These acquisition sprees are massively concentrating American wealth in fewer and fewer hands, and would not have been possible without the fire-hose of Fed cash that extended almost limitless credit to institutional players in 2020 and 2021.
“From March, 2020 on the Fed went on a buying spree, pumping roughly $5 trillion into the economy, growing its balance sheet to above $9 trillion. The bank’s purchasing programs rescued scores of companies from penury and reversed an incipient market crash, but were also a gigantic ongoing subsidy to anyone owning financial assets…
“Billionaires gained $4.1 trillion around the world during the pandemic, and in just the U.S. billionaire wealth nearly doubled, from $2.9 trillion to $5 trillion. As of late last year, just 2,750 people globally controlled 3.5% of the world’s wealth, up from 1% in 1995.”
I will recommend Matt Taibbi to anyone curious about what’s really going on in the world and able to turn off CNN and Fox, ignore the NYT and Washington Post, stop with all those right wing froth factories on the internet.
Yes, you have to pay. Quality content is worth it, because truth matters. And the truth is, America is getting screwed by the top 1 percent.