I took an old Schwinn to the local bicycle shop for restoration for a neighbor kid. While there, I saw something I've not seen in many years - A DK General Lee.
When I was a kid, DK's iconic General Lee was one of the BMX (bicycle moto-cross) bicycles to own. It was an iconic fixture in the BMX scene, there would often be a local rider at the park or trail with one, and it was always the envy of everybody else.
The bicycle pays homage to the 1969 Dodge Charger from The Dukes of Hazard television series, generally painted in "Hemi Orange," feating an "01" on the seat, the words "General Lee" on the frame, and confederate battle flag bicycle pads.
DK bicycles added some other curious details; the pedals and chainring were iron crosses. Iron cross valve stems were also available.
I asked the shopkeeper about the General, assuming it was in for service, hoping it might be for sale. I have not seen one in probably 20 years. The keeper told me he had just taken it in on trade and would like to get rid of it with haste. "Why?" I asked. "The controversy," he replied.
I suppose I was in an unusual bucolic sort of mood, having spent the afternoon riding a bicycle in the countryside, my mind far from the politically correct paradigm that infests every aspect of our lives.
The controversy relating to the Confederate flag, General Robert E. Lee, among other confederate figures, the Charlottesville Unite the Right rally, and Dylan Roof, he replied.
Oh, That controversy. Back to America in 2022.
He told me that DK bicycles had recently (June 05, 2020) officially canceled production and sales of the General Lee bicycles, releasing a statement on the matter. DK bicycles wrote;
A wake-up call is sounding in America. We've heard it loud and clear. BMX is a small space. There's no room for racism. There is no perfect right thing to say. But there's clearly a right thing to do. Effective today DK is discontinuing all General Lee model bikes. We won't stop listening and learning. Thanks for sounding the alarm.
This statement from DK came after the owner of the General Lee car announced he will soon paint over the Confederate flag on the car's roof, which he announced via Twitter two weeks after the Charleston church shooting.
The timeline of events is something like this;
June 17, 2015 - Charleston church shooting.
July 02, 2015 - The owner of the General Lee Charger announces he will paint over the flag.
February 2017 - Charlottesville City Council votes to change the name of Lee Park to Emancipation Park, now known as Market Street Park (as of July 2018)
August 12, 2017 - Unite the Right rally in Charlottesville, Virginia, opposing the park's renaming and removing the Robert E. Lee statute.
June 05, 2020 - DK Bicycles announces they are canceling the General Lee bicycle
Comments regarding the news were varied, as to be expected. Some cheered the cancellation. Others insisted the General Lee bicycles were merely a pop cultural symbol, too far removed from alleged racism to warrant this treatment. As for me, well, I'll leave that up to the reader to figure out.
A piece of BMX history, my childhood, and now, oddly enough, a part of American history as it stands in a long line of excised artifacts unceremoniously removed by liberal iconoclasts.
I asked how much for the bicycle.
"$150." General Lee sold for $530 most recently before its cancelation and cheaper than eBay or BMX forum members selling one.
"I'll take it."
I had new tubes, tires, brake pads, and chains installed. I found a "new old stock" set of original DK grips and a set of the Iron Cross pedals from a BMX forum. The bicycle now looks like it did when it was new after a thorough cleaning and the new parts.
I've already put over 20 miles on the General Lee, riding around town at night after work, a good amount for a BMX bike. It has earned many compliments, some smiles, and the occasional sly thumbs up as I cruise along the avenues while the sun fades behind the trees.
Several trends in the United States are going on related to home ownership that I find rather startling. Some of those trends have been slow, taking decades to mature, and perhaps even noticed by many. Other trends are more acute temporally, springing up over the past few years. These trends have altered the landscape of home ownership and, overall, have made home ownership and housing security far more difficult for most Americans.
One of the first pieces of data I came across that struck me as significant was a 2018 chart showing that across the United States, the length of time needed to save for a 20% home down payment has increased by 1.5 years over the past 30 years. In 1988, with an average household income of $28,100, it would take 5.7 years of savings to have 20% to place on the average home. In 2018, it was 7.2 years, with some more expensive cities outpacing this rate several times. Some studies show an even more extended amount of time needed to save for a down payment, reporting over an over ten-year average, compared to 6.4 years in 1971.
The principal reason for the increased time it takes to save for a down payment and general affordability is the relationship between household income and home prices.
In 1960, the average household income was $5,600, and the average cost of a home was $11,900. These figures created an average ratio of house price to income of 2.125 (found by dividing the average house price of $11,900 by the average income of $4,600).
Price to income ratio is a commonly used metric in the housing market and finance. The price-to-income ratio stems from the general guideline that housing costs, whether rent or a mortgage, and related expenses, should not exceed 30% of gross income. As such, if a household spends around 30% of their income on a home mortgage, they can comfortably afford a home about 2.6 times the amount of one year's income. The average price-to-income ratio in the USA is around 4.5, with a median ratio of 3.8, reaching historic highs.
A quick example of how the 30% rule and 2.6 times one year’s income would look; if the median household income is $67,000, 30% of the gross income would be $20,100, divided by twelve months, that is $1,675 per month for a mortgage, insurance, and property taxes. If we multiply $67,000 by 2.6, the cost of the house that would be affordable within the 30% guideline, we get $174,200. A 30-year fixed rate mortgage on that amount is about $1,000 per month, leaving money for taxes and insurance and still enough for all other living expenses comfortably. The glaring issue is that the median home price in the U.S. is around $420,000, with a mortgage payment of about $2,300 per month.
Since 1960, median home prices have increased 121%, with median household income straggling behind with a 29% increase as of 2017. Median rents have increased by 72%.
*The median prices and income represents the central tendency of distributions. Where the average can be skewed by very high outliers, which are in both sets of data regarding incomes and home prices, median values represent more of what the "typical" American family might experience.
The South and the Midwest regions of the U.S. are the most affordable regions in the country. In the South, from 1960-2017, the median income increased by 49%, and the median home by 156%. For the Midwest, there was a 29% increase in median household income and an 82% increase in median house prices. These regions are "affordable" compared to the Western part, which has seen a mere 26% increase in median household incomes with a 195% increase in median home prices. Which looks affordable still compared to outlier cities such as New York, Boston, Los Angeles, and San Francisco, who saw incomes increase by 54%, 71%, 32%, and 91%, respectively, while their median home prices went up by 184%, 228%, 358%, and 531%.
A different study looked at the median home prices from 1965-2021, finding that the median home price has risen 118%, while the median household income increased only 15%, a difference of nearly eight times. Adjusted for inflation, since the housing market crash and recession in 2008, house values have increased over three times the rate of incomes. As house values recovered and increased, wages remained flat.
Historically in the United States, a large share of the wealth of the middle-class was held in home equity. Now, as the difficulty of home ownership increases with each passing year and decade, the trend of substantial home equity is likely to continue to slow. Homeownership becomes more out of reach with each American generation, reflected in lower ownership rates.
This year, after interest rates jumped to 5.5%+ from much lower rates in the 3% range last year, the housing market has cooled after its hot run. As a result of the higher rates, the buying spree has slightly stemmed for now. In May, sellers started to lower prices on their homes; 15% of listings reduced their asking price. However, year over year, prices are still up 17%. June saw about 15% of deals in contract fall through. The past five years have seen 11-12% of sales not closing. Although this is a welcome sign to many hoping to buy a home or respite from climbing rents, this is a minimal correction on a micro scale for a problem that has been gaining momentum for over fifty years.
Home values are increasing beyond a function of inflation. The median home in 1980 cost $47,200, and $79,100 in 1990, adjusted for inflation those prices are $93,400 in 1980 and $101,100 for 1990. During some years, we have seen home price increases outpace inflation by double.
We'll look at and make a quick note concerning popular commentary surrounding the housing market trends from a CNNarticle and a study by King’s College London.
First, the CNN article titled “These Entitled Millennials Are Cheering for a Housing Market Crash.” This piece is the typical fare from out-of-touch journalists. Instead of making a good faith attempt to unearth the issues with the housing market and economic landscape most people face, the entitled journalist instead mocks people who are desperately expressing legitimate concerns over housing prices and general instability.
The King's College London study found that over half of baby boomers believe "luxury lifestyle" items are to blame for the younger generation's inability to buy a home. Although it can be easy to dismiss and hold boomers in contempt for suggesting the younger generations merely need to "cut back a little," I'll offer a different approach. Primarily, boomers, for the most part, live in a world that doesn’t exist anymore. They still believe if you go to work, work hard, and have any level, even minimal levels, of financial discipline, you can relatively easily "make it" in the United States.
They come from an era when the average home cost was 2.5 times or so the average salary, when wages were still keeping up with inflation, productivity, and company profits, and when the supply of houses was not eaten up by over a million new immigrants per year, who at the same time drive down wages. The world boomers matured in, worked in, bought houses in, and invested in - that world does not exist anymore. Perhaps at some point in the 70s, when gas prices and interest rates were high, cutting back on unnecessary luxuries would have been fine advice to stay solvent and financially stable. However, as we have seen, that world might as well be another country. Some forgotten and far away land, where the average person could count on earning enough money the next year to at least stay level with rising costs, has not been the trend for quite some time now. Essentially, many boomers are operating on outdated "rules of thumb" that are becoming increasingly irrelevant. Cutting out coffees and Netflix, and many other small luxuries for that matter, will not add up to an amount anywhere near what is needed to overcome housing costs. Costs are outpacing incomes by more than an entire year's worth of pay compared to when the boomers were buying homes for the first, second, or third time.
And from Fortune, “What causes a recession? Maybe it’s you and how grumpy you are about the economy.” This theory is interesting beyond its inflammatory headline, essentially an argument that low consumer confidence often precedes an economic downturn and may be causal. The author points to some factors, such as high employment levels, as a reason people should be more optimistic and not be so pessimistic about the economy, which could cause a recession. Two glaring flaws are present, one, assuming that something like low unemployment matters when employed people see their wages outpaced by the cost of living and inflation. And two, this assumes that consumer feelings are baseless and irrational. I do not believe that is the case.
I have seen and heard many comparisons to the 2008 housing market. Those speculating this market is another bubble and that prices will fall or crash, providing some relief to those being priced out of ownership and where rent is squeezing them economically. There are several issues with this idea. First, even if prices begin to fall, that doesn't translate to higher supply. Mortgage delinquency rates are much lower today than in 2008; one signal that the current trend is substantially different from before. In 2008, people lost homes to foreclosure largely due to lending practices, meaning their homes were returning to market supply while driving down prices overall. Another is that many institutions and foreign investors are now buying single-family homes, adding to the supply shortage, and whose position is presumably much more stable than the sub-prime borrowers and their lenders of 2008. Finally, even if there were a 2008-level crash, as we have seen, the home prices would likely recover at a rate outpacing income. Unless the prices crash by a genuinely biblical proportion, such that values are reduced by half or so, the price-to-income ratio would still be such that average Americans are struggling to afford a home. Not even the 2008 crash itself was able to reset the median price to income ratio to a historically "normal" level. There are minimal signs a housing crash now would do such a thing.
As housing, utilities, fuel, food, clothing, and transportation costs all rise, at least partly a function of inflation, the majority (75%) of middle-class households surveyed (those earning $30,000-$100,000 per year) say they are beginning to fall behind.
I have noticed several trends over the past few years, beyond low-interest rates, that contributed to the heated housing market. We saw dozens of offers on every house for sale in many parts of the country, cash offers well over asking prices, buyers waiving inspections with their bids, and low supply on the market. Several things happened almost all at once; Black Lives Matter riots all over the country that lasted through the summer of 2020, the rise of liberal district attorneys with an incredibly soft on crime policy (for certain crimes and specific demographics), Covid lockdown policies, and the institutional mass-buying of single-family homes by heavily funded asset management firms such as the Blackstone corporation. In short, we are in an intersectional dilemma, where liberal public policy, black crime, white flight from the cities, and leviathan investment corporations all come together to create a terrible strain on most people.
A country feels less and less like "yours" when you can no longer own a home if you'd like. I have seen houses on moderate-sized lots in my area sell for $350,000 or more, whereas comparable houses were selling for $250,000 several years ago, half of that around 2008. The liberal urbanite and suburban white flight is always troubling. As the larger cities have seen a wild increase in crime since 2020, the same people who support Black Lives Matter are fleeing the violence and property theft, moving into different suburbs or more rural areas, increasing the housing costs for those who already lived there, and promptly display a pride and BLM flag in their new location, inviting the exact problems they just fled.
If that was not vexing enough, the exodus from the cities and institutional buyers drives up the housing costs and property taxes along with them. Effectively taxing many people out of houses they could once afford due to the increased tangential costs of home ownership.
The World Economic Forum catchphrase, "You will own nothing, and you will be happy," stalks us still. Those who have already purchased a home and built equity will likely continue to be pressured by rising property tax rates as homes around them trend upward. The same pressures loom for those who may inherit a home or equity in a house. There have been people I know that have been essentially forced to sell their homes due to rising costs of living and property taxes. With the sale, they may be flush with cash but have nowhere to go, so they will rent, perhaps indefinitely.
According to a 2018 study, a survey of Americans found that 82% of respondents said their idea of the “American dream” is financial security for themselves and their family, with 75% saying owning a home is part of that dream. The same study reported that a third of those surveyed said the American dream is slipping away. Sadly, I cannot help but agree with that sentiment.
Last week a black co-worker imparted a story and gave me a further window into the way of life among certain populations. I thought I would share this new deep lore with all of you.
His name is Brian, and Brian lives in a predominantly black part of town. His apartment complex of several hundred units does not host a single white family or person. There is not much "diversity" in the population at all. It's almost entirely black.
Brian told me he likes to sit on his back patio at night and have a few beers. His apartment is furthest back in the complex. Nobody lives behind him. There is a stand of trees and little else. He told me that he "forgot to take in his lightbulb" last night and somebody stole it.
My reaction was mostly confusion. in my entire life, I have never once heard the phrase "I need to take in my lightbulb. Ever. I had no context or understanding.
Brian explained that in very dark areas, if you want a light outside, such as a porch or patio light, you have to take the bulb inside with you when you go inside. If not, somebody will come by later in the night and steal the unattended bulb to use inside their apartment instead of buying lightbulbs. There is no need to buy your own lightbulbs when others leave them on all night outside for easy picking. They see it as an unnecessary expense.
So every night, if Brian wants to have a light on while outside, he has to unscrew the bulb from the fixture and take it back in with him, or else it will get stolen. He went on to say you definitely do not leave a chair outside, not even a milk crate to sit on if you'd like to keep it.
I am not a stranger to these parts of town at all. I can move in them comfortably and unbothered, which I'm somewhat proud of. But this level of low trust had me reeling for the rest of the day.
Take care... and don't forget to take in your lightbulb!
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Full-time journalism, legal show production, more pixel art, more cozy images, more of everything.
Total takeover, firing on all cylinders.
Cost of readership would drop, we would reach more and more people with these stories, and the content would come more often.
At this goal I can hire people to help me with content, add video production and audio recordings of articles, and really begin to expand the entire operation. I would like audio versions of all of the content to ensure people who cannot read well or travel often are able to have access to the stories. We are the stewards of our people and must care for all of them.
In addition to full-time writing, the legal podcast, and a community resource, I will hire a secretary, PR manager, and a guard-pupper to alert me of intruders.
The pupper will probably be a beagle or german shepherd, the secretary will be cute, the PR manager will be friendlier than I am.