Unintended Consequences Impact Everything

Money For the Rest of Us

J. David Stein

Investing, Investing Podcast, Business, Economics, Economy

4.5 • 1.4K Ratings

🗓️ 24 August 2022

⏱️ 25 minutes

🔗️ Recording | iTunes | RSS

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Summary

We explore examples of positive and negative unintended consequences, what causes them, and how to navigate a world where unanticipated things happen all of the time.

Topics covered include:

What leads to unintended consequences
What are some unintended consequences of QE and stimulus, price controls, tax incentives, gun legislation, and marijuana legalization
How positive unintended consequences and order can arise from the bottom up
How recent climate legislation could lead to unintended consequences
Why customers don't always know what they want

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Show Notes

Large rent increases squeeze metro Phoenix tenants by Associated Press—The Journal Record

Unintended Consequences by Karras Lambert and Christopher J. Coyne

The Seen, the Unseen, and the Unrealized: How Regulations Affect Our Everyday Lives by Per L. Bylund

Norway reconsiders electric car privileges by Chris Randall—electrive.com

More Guns, More Unintended Consequences: The Effects of Right-to-Carry on Criminal Behavior and Policing in Us Cities by John J. Donohue, Samuel Cai, Matthew Bondy, and Philip J. Cook

Marijuana Legalization and Fertility by Sarah Papich

Japan’s latest alcohol advice: please drink more by Leo Lewis and Kana Inagaki—Financial Times

The Poverty of Historicism by Karl Popper

How the New Climate Bill Would Reduce Emissions by Nadja Popovich and Brad Plumer—The New York Times

Democrats Designed the Climate Law to Be a Game Changer. Here’s How. by Lisa Friedman—The New York Times

Economists’ Statement on Carbon Dividends; The Largest Public Statement of Economists in History—Climate Leadership Council

Why We Don't Have a Carbon Tax by Paul Krugman—The New York Times

Lean Startup and the Business Model: Experimentation Revisited by Teppo Felin, Alfonso Gambardella, Scott Stern, and Todd Zenger

Related Episodes

158: How To Invest Like A Cockroach

236: How Investors Cope With Radical Uncertainty

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Transcript

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0:00.0	Welcome to Money for the Rest of Us. This is a personal financial show on money. How it works,
0:05.8	how to invest in how to live without worrying about it. I'm your host, David Stein,
0:10.7	today's episode 399. It's titled Unintended Consequences are Inevitable and What to Do About Them.
0:18.9	A couple weeks ago, LaPronai stopped in Phoenix on her way from Idaho back to Tucson.
0:26.4	While I was walking that next morning, I saw a woman in a distance. She was walking very erect,
0:33.2	pushing a wheelchair. Later, when I went into a convenience store and came out, she walked in.
0:40.3	She was wearing a mask. She was homeless. But she looked like she hadn't been homeless for very
0:45.2	long. Her clothes were still very clean. They were, she was very well dressed. But she clearly had
0:53.1	been pushing a wheelchair with her things in it, as you often see the homeless do. In Phoenix,
1:01.0	rents have increased 30% in the past year. The vacancy rate for apartments is 3%. The average
1:10.0	is 6%. I didn't speak to the woman. I wanted to, but I just didn't. And she was coming in as I
1:16.1	was going out. I was curious about her story. Because with rents increasing by that amount,
1:23.5	logic dictates that the number of homeless is increasing because they can't afford those
1:28.6	higher rents. In Metro Phoenix, overall rents have increased 80% between 2016 and 2021.
1:38.0	In episode 388, we looked at the massive increase in the money supply in the US from a combination
1:45.7	of the Federal Reserve's quantitative easing program and government stimulus, the government,
1:51.9	the US government running huge federal budget deficits during the pandemic with many of those
1:58.8	funds going to help those that are down and out. An unintended consequence of all of that
2:05.3	stimulus and money creation appears to be a rise in homelessness because rents have increased
2:13.6	so much. Why have rents increased? Low interest rates combined with stimulus led to more people
2:22.3	being willing to purchase houses and to pay more for those houses. And as housing prices have
2:27.5	gone up, the rent on those houses have gone up and the value of apartments have increased as has
	...

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