Both rent and home prices are driven by supply and demand, that is, what the market can bear.
In both cases supply is the same, but for ownership, the market is global. You can live on the moon and own property in Vancouver. The price of Vancouver property is constrained only by the limits of how much foreign capital is available to be safely parked in Canadian real estate, not by the population of Vancouver. As you can imagine there is considered more of the former than the latter.
However, the market for rentals is constrained by the number and salaries of people who actually live in Vancouver. Nobody rents an apartment in a city in which they don't actually reside. You can't charge $3,000/month for an apartment in Vancouver because no one will be able to afford it. In Vancouver a junior engineer earns $60,000/year.
Vancouver salaries aren't higher than anywhere else in Canada (in fact they're lower than Calgary and Toronto, both of which have cheaper housing, and about on par with Montreal which has MUCH cheaper housing), so despite the crazy property market this keeps rents down.
SF's crazy rents are driven by the tech industry salaries that are much higher than anywhere else in the country (or in the world for that matter).
SF prices are driven by intense demand due to the tech industry. Tech continues to import more and more people but there isn't enough room for everyone.
Vancouver prices are driven by speculation, primarily from international investors. The actual demand for housing in the city is comparatively low, and the typical salary for white collar work in Vancouver also doesn't support sky-high prices.
The large disconnect between sale and rent prices represents the large disconnect between who is buying vs. who is actually living in these homes.
Fiat currency is valueless and can only be used because people trust the government issuing it. If Bitcoin can gain the trust of enough people, it can easily become more 'valuable' then many currencies in existence at the moment.
Fiat currency is backed by the legal obligations of the country that issues it that it is a suitable means to extinguish debts.
Bitcoin is not. No one is obliged to accept Bitcoin as a currency for settling debts anywhere in the world, it has to be converted to something else. Similarly to gold - you don't have to accept gold as payment for debt, but you do have to accept USD.
This is where the problem lies: BTC acts like a commodity, not a fiat currency - and people are treating it like one buying into it. The problem is it has no value as a commodity other then being Bitcoin.
It does have value. It's long lasting, pseudonymous, secure, and it costs less to make transfers between two parties. These are qualities that are hard to find in a physical commodity. What gives value to an individual bitcoin is the Bitcoin network. There is real value there.
I don't want to be too rude, but to quote the hn guidelines
What to Submit
On-Topic: Anything that good hackers would find interesting. That includes more than hacking and startups. If you had to reduce it to a sentence, the answer might be: anything that gratifies one's intellectual curiosity.
I'm not saying that this article belongs here, but hn is not just for discussing hacking and startups.
That'd work if there were some guarantee that those voting for it were 1) good hackers, and 2) genuinely found it gratifying to their intellectual curiosity.
I think that #1 is entirely plausible, as most hackers have plenty of interests outside of hacking and startups, including politics. I find #2 doubtful. This looks like an article made to "get ones dander up", rather than to shine a light on some obscure but fascinating aspect of how the world works. The latter sort of article are usually really interesting, well written, and provoke discussions that are interesting to read in their own right, rather than extensions of people's convictions such as "Monsanto... BAAAAD".
I wish it were easier to explain the difference between the two, as I think it's usually very easy to distinguish them, and that PG would put it in the guidelines.
Maybe something like "articles designed to get an emotional reaction, or designed to make people agreeing with them feel like they're in the right, should be avoided".
What does "deeply interesting" mean? It means stuff that teaches you about the world. A story about a robbery, for example, would probably not be deeply interesting. But if this robbery was a sign of some bigger, underlying trend, then perhaps it could be.
The worst thing to post or upvote is something that's intensely but shallowly interesting. Gossip about famous people, funny or cute pictures or videos, partisan political articles, etc. If you let that sort of thing onto a news site, it will push aside the deeply interesting stuff, which tends to be quieter.
Either way, I agree that this article probably shouldn't be on hn.
EDIT: It looks like this has been flagged and removed from the front page
> The fact that you had to use the No True Scotsman* definition for hackers as your argument really does not endear it to me.
Please read what I wrote more carefully.
I said it was entirely plausible that good hackers vote up articles like this, because good hackers have varied interests that include things like politics.
Most of my argument focuses, in any case, on the difference between the "getting people excited" vs "describing something fascinating" types of articles.
I was recently pointed towards Principles[1] by Ray Dalio by someone here on HN, and I highly recommend it. He talks about getting what you want out of life, and how that starts by figuring out what you want. He then lays out a process to get you there. If you're thinking about your career path, give it a read. It's long, and somewhat tedious prose, but it provided me a lot of insight as I'm figuring out what I want to do post-graduation.
Being a Waterloo engineer, I agree with this wholeheartedly. Perhaps even more importantly, I'd say the top talent disproportionatly dreams of getting out of Waterloo. Most quality students want to get down to Cali.
I respect what Litt, Pebble, Bufferbox are trying to do, but I don't think young talent is the reason their doing it. I think that the cost of living, tax credits and familiarity are the reasons they're back in Waterloo.
All the power to me, but for me, California sunshine seems too good to pass up when there's three feet of snow on the ground in the middle of February.
Everyone should experience Silicon Valley. Vidyard's investors and network of influence are SV based. I'll never negate that.
Reasons I'm in Waterloo = Availability of Talent, Retention of Talent, Cost of living, Quality of Life
We've never had an issue with young, technical talent and I firmly believe that we have the best. That's more that can be said for our Californa based batch-mates.
I'm just running off personal experience here (I've been through the Velocity Residence and Eng), but of the 10 smartest kids I know, all but one is in The Valley/Seattle. I think they plan to stay South after graduation.
Why do you think you can you get better talent? Less competition? People want to be closer to home? You can offer more in perks, salary, ect compared to local companies?
I'm still in school; just finished 3A, so ive got a pretty fresh look at things. It seems to me Waterloo's stature is rising in The Valley, and they are offering more jobs. I had about 30-40% of my class go to Apple this semester, for example.
A small fix, Pebble is actually in Cali full time now. And it's been this way ever since YC 1.5-2 years ago when I interned with them.
The other thing is regarding familiarity, startup focused folks don't strike me as being too fond of familiar environments just for the sake of familiarity, though I realize this is a generalization on my part.
Perfect for local business shops too. Think of a local flower shop, I bet birthday orders could be huge for that type of thing. It scales decently as well if the business adds itself.
Musk is one of my hero's, but his first company was a web start up that help publisher's get news articles and other content online. He then built a money management system, which eventually became part of Paypal. These are hardly the world's important problems. But the exits from these wins allowed him to do what he is doing.
I think that's important to keep in mind if you want to belittle guys building Web 2.0 apps like Flipboard, reddit, ect.
Of course, he got the capital that allowed him to go into these capital-intensive businesses doing internet startup (though at the time he did it, the internet was a lot less mature and he helped move that forward to, mostly with Paypal).
But I still wish more smart and driven people did more important things than photo-sharing apps. It might be impossible to jump directly into capital-intensive industries unless you can join an existing startup (go work for someone like Musk?), but there are also lots of non-capital intensive ways to do very important things that would move our civilization forward more rapidly than one more Web 2.0 company. Same for all the brainiacs who go into investment banking rather than in engineering or biology or whatever. Totally up to them, but it doesn't change the end result.
