DAILY TRIFECTA: The Super-Rich Are Super Close To Achieving Orbit
The economy doesn't suck. It just sucks for you.
THE SET-UP: Oxfam International did it again. They reminded us of the ever-widening disparity between 99% of human beings and a de facto class of trans-national oligarchs who’ve enjoyed a decade of mind-boggling success. Common Dreams reported on the Oxfam report, which found 1% of Planet Earth’s human beings accumulated $33.9 trillion in wealth over the last decade.
Most people call it “inequality.”
I call it “exit velocity.”
Simply put, I see Oxfam’s yearly reminders as updates on the flight path of a financial elite who’ve long-since left the Earth and escaped its economic gravity. The launch date was 2008. That’s when the elites who used financialized gimmicks (a.k.a. “exotic financial instruments”) to suck the wealth out of the working and middle classes were first given what would eventually be trillions of dollars of essentially free money they then used to horde many of the assets they themselves crashed … assets which they ultimately bought at a steep discount. Known as “Quantitative Easing,” it also supercharged investors and the stock market. It was supply side economics on ‘roids.
Look back and you’ll see that since 2008 there’s been a meteoric rise in private equity, venture capital and inequality. You’ll also see a stock market inflated by all that Fed-sponsored play money … with investors able to pump-up stocks and extract that wealth through buybacks (which was tantamount to money laundering). They lured the middle class back into the market with their inflated stocks. Price-to-earning ratios became an archaic vestige of a bygone era. Venture Capitalists instead introduced us to “unicorns”—companies with billion-dollar valuations despite earning no revenue. Yeah, investors got rich thanks to “exits” from “pre-revenue” unicorns. “Pre-revenue” was and is an actual thing now. And data became gold.
Meanwhile, the people who lost their homes to unscrupulous lenders paid the price … many lost everything. Not coincidentally, it was the start of something new in the US—what I call “roadside favelas.” Across America you can now find a new underclass of homeless and houseless—people who live in tents and cars and RVs along city streets and under overpasses and in public parks. Many them we’re numbed-out by an opioid explosion that took off at the same time financial elites were being Quantitatively Eased-off the launch pad. Opioids became a “crisis,” access was eventually restricted and now the US has a fentanyl crisis in its place.
Does anything better epitomize “inequality” than Big Pharma handing buckets of painkillers to distressed people who lost their homes and jobs while, at the same time, the Fed handed buckets of no-interest play money to the very elites who caused people to lose their homes, their jobs and their futures?
Now those elites are soaring in the upper atmosphere—figuratively and literally. Think of it, Amazon’s Bezos and PayPal’s Musk in a space race! The double-meaning couldn’t be more apropos given that the tech industry and surveillance capitalism benefited the most from the 2008 lift-off. Venture Capitalists raised their “unicorns” on oodles of excess capital the Fed poured into Wall Street’s trough. Big Tech and Silicon Valley’s unicorns thrived in the over-Fed economy.
Now we have Tech Overlords leading the flight from Earth … with a post-PayPal Elon Musk plotting a future on Mars as we struggle with economic gravity on a planet people like Musk and PayPal-propelled Peter Thiel are willing to trash in pursuit of their quest for immortality. They, along with the One Percenters, have the money and assets to insulate themselves from the consequences of their ambitions.
To say they don’t worry about the price of eggs doesn’t begin to cover it.
They, like Meta’s Zuckerborg, are not stocking up on Costco toilet paper. They are building survivalist bunkers and secure, self-sustaining compounds. They’ve turned New Zealand into their personal panic room. And their futures don’t hinge on a 401k or Social Security or Medicare or Medicaid. They can absorb huge drops in stock prices and sleep easy every night knowing they are unconstrained by the economic gravity that keeps most of humanity living hand to mouth each and every day.
That is “exit velocity” … the ability to leave the Earthlings behind and enter into an orbit that puts them out of gravity’s reach … the economic gravity that holds the rest of humanity down and out of far more than Beverly Hills. It keeps us inexorably bound to a rapidly warming planet they’re willing to cook with energy-hungry data centers that, in turn, will populate the economy with artificial intelligence and robots. - jp
TITLE: Luxury homes are hot again in San Francisco
https://qz.com/san-franciscos-luxury-housing-market-boom-ai
EXCERPT: Bradley Nelson, Sotheby’s International Realty’s chief marketing officer, told Bloomberg that last year more…$20 million homes sold in the city than in any other year to date and saw its biggest sale ever when Laurene Powell Jobs — billionaire philanthropist and Steve Jobs’ widow — purchased a mansion for about $70 million.
The city’s luxury market has kept up a similar pace so far for 2025, with an Atherton mansion selling in April for $51.5 million, the largest residential home sale this year.
Nelson added that San Francisco is a hot spot for entrepreneurs and tech investors who want to get in on the AI boom due to the city’s access “to the labor pool with that technical expertise.” Another analysis found that increased interest in investing in AI could also increase real estate deals for office spaces.
Additionally, buyers of the multimillion-dollar homes are investing in renovations that could take years to complete, which Nelson told Bloomberg indicates a longer-term investment in the area.
This change in San Francisco’s luxury real estate market is aligned with other markets around the country and world. According to the report, New York City, Utah, and some countries in Europe are also experiencing a boom in their luxury markets.
Sales for luxury properties (homes $10 million or more) in New York City increased by 115% while Utah set a state record with 15 sales priced above $15 million, according to the report. Nelson told Bloomberg that Americans are snatching up luxury properties in countries like Portugal, Italy, France, Spain, and in the U.K. due to currency fluctuations. Plus, Washington, D.C., saw an increase in luxury sales earlier this year due to President Trump’s return to office.
Philip A. White Jr., president and CEO of Sotheby’s International Realty, said that luxury homes have outperformed the rest of the housing market in 2024 and so far in 2025 due to luxury property buyers' ability to pay in cash rather than borrow at high interest rates, adding that the current strength in the luxury property market can be attributed to the end of a volatile global election year and a shortage of luxury homes in some areas driving up prices.
TITLE: Here's the latest stat showing how the US housing market has frozen over in 2025
https://www.businessinsider.com/new-home-sales-inventory-prices-mortgage-rates-economy-redfin-2025-6
EXCERPTS: New home sales dropped sharply in May, the US Census Bureau reported on Wednesday, showing that the US housing market is at an impasse as buyers hesitate and sellers struggle to offload their homes.
Sales of new single-family houses fell 13.7% month-over-month, from 722,000 in April to a seasonally adjusted annual pace of 623,000 in May. The May number is 6.3% lower year-over-year.
The decline in sales was led by a sharp slowdown in the South. Sales in the region plunged 15.5% year-over-year and 21% from the previous month. The Northeast was the only region that saw an increase in new home sales.
Americans aren't buying homes, but it's not because supply is constrained like it was in 2024. On the contrary, housing supply has picked up.
The May report showed that there were roughly 507,000 new houses available for sale. At May's sale pace, it would take 9.8 months to clear the supply of housing. Anything higher than six months of supply typically indicates a buyers market — a notable shift from the sellers market that led to rapidly appreciating home prices post pandemic.
Data from Redfin earlier this month also points to a deep freeze in US homebuying activity.
Redfin reported that there's a record $700 billion worth of homes for sale across the country, an all-time high by dollar amount.
TITLE: US economy shrank 0.5% in the first quarter, worse than earlier estimates had revealed
https://apnews.com/article/economy-tariffs-trump-gdp-shrink-86d1f15e66c646ac4ce88ffc0a956942
EXCERPTS: The U.S. economy shrank at a 0.5% annual pace from January through March as President Donald Trump’s trade wars disrupted business, the Commerce Department reported Thursday in an unexpected deterioration of earlier estimates.
First-quarter growth was weighed down by a surge of imports as U.S. companies, and households, rushed to buy foreign goods before Trump could impose tariffs on them. The Commerce Department previously estimated that the economy fell 0.2% in the first quarter. Economists had forecast no change in the department’s third and final estimate.
The January-March drop in gross domestic product — the nation’s output of goods and services — reversed a 2.4% increase in the last three months of 2024 and marked the first time in three years that the economy contracted. Imports expanded 37.9%, fastest since 2020, and pushed GDP down by nearly 4.7 percentage points.
Consumer spending also slowed sharply, expanding just 0.5%, down from a robust 4% in the fourth-quarter of last year. It is a significant downgrade from the Commerce Department’s previous estimate.
Consumers have turned jittery since Trump started plastering big taxes on imports, anticipating that the tariffs will impact their finances directly.
A category within the GDP data that measures the economy’s underlying strength rose at a 1.9% annual rate from January through March. It’s a decent number, but down from 2.9% in the fourth quarter of 2024 and from the Commerce Department’s previous estimate of 2.5% January-March growth.
This category includes consumer spending and private investment but excludes volatile items like exports, inventories and government spending.
And federal government spending fell at a 4.6% annual pace, the biggest drop since 2022.