[squidlogic]

>asset prices don't matter to ordinary people.

Can you provide some data on this assertion? I would be surprised to learn that the majority of ordinary people (assuming you mean something like 'net worth < $1MM USD') do not care about housing costs and car costs, which are both assets.

[eldavido]

The median net worth in the United States is approximately zero (assets less student loans, mortgage debt, etc). The median 401k balance in the US is something like 100k. I'm probably right of many people here politically but will readily admit, there's a lot less wealth out there than you'd think, and what there is, is held by a pretty small number of people.

Also, speaking broadly, I don't think the economics profession really understands the connection between house prices and rents. It's a complex topic with a lot of conflicting information. I definitely wouldn't take it as an article of faith that more expensive housing necessarily implies higher rents. There are all kinds of complex subsidies like mortgage interest deductions, factors like credit availability, short-term fluctuations in material and labor prices, etc that make a straight-through 1:1 correlation too clean.

As a general comment, it helps to disaggregate when thinking about huge topics like rental inflation. Rent is growing fast in western/mountain markets (e.g. Idaho) and places like Miami, while hardly budging in places like Cleveland or St. Louis. I'm sorry not to have citations on a lot of this, it mostly comes from firsthand experience and a lot of reading -- I read the economist cover-to-cover every week, manage 12 rental units, and talk to friends and family spread across the US (Seattle, DC, Chicago, Indiana, etc) almost every week.

[ask_b123]

Where did you get the data on median net worth? I found this, https://en.wikipedia.org/wiki/List_of_countries_by_wealth_pe..., which states that the median U.S. net worth per adult is 79,274.

Following the references and links I ended up reading this: https://www.federalreserve.gov/publications/files/scf20.pdf, on the top of page 6 there is an interesting tidbit:

> One liability of using the median as a descriptive device is that medians are not additive—that is, the sum of the medians of two items for the same population is not generally equal to the median of the sum (for example, median assets minus median liabilities will generally not equal median net worth). In contrast, means for a common population are additive.

[eldavido]

I think that number was across the entire population, so includes children, etc. Probably came from either Piketty's Capital or something else (weekly reader of The Economist plus a lot of econ books)

Still, 79k for adults, inclusive of retirement accounts, home equity, etc. really isn't much.