True North

Markets change.

Left to their own devices, markets for pretty much anything will move in some kind of cycle or another.

Remember Beanie Babies? As demand boomed, the prices skyrocketed; when supply couldn’t keep up, fights broke out as the demand curve shot out past the bounds of reason. Then the supply caught up, and a huge collectors market - let’s call it a “Beanie Baby Bubble” - erupted. People, awash in “irrational exuberance”, started banking lots of money on the future upside of the Beanie Baby; there were even stories of people betting their retirement funds on the Beanie Baby market.

The bubble deflated, eventually. First, the supply of Beanies caught up with, then surpassed, and finally obliterated demand, as the supply of common sense finally caught up with the supply of duuuuuhhhhhh.

Today, Beanies have a respectable market. As toys. Not as investment products.Stores, adjusting to the demand, changed what they stocked; more XBox 360s, less Beanies.

But then, RT Rybak wasn’t mayor at the time. Had he been, perhaps - to try to prop up the city pension fund’s investments in Beanies (one can imagine), or to punish stores for having participated in the bubble, he might have instituted policies as stupid as this one:

As New Prague and other cities see more single-family homes changing over to renters because of the national housing market meltdown, many are enacting tougher rental policies. Since February, Minneapolis has decided to collect a $1,000 fee when a home is converted to rental.

The Minneapolis fee will cover costs such as inspections.

Leaving aside the first, obvious question - does it really cost $1,000 per house to send a city droog to “inspect” the property?

What’s the percentage for Minneapolis stifling a sane, rational response to the situation? Given a choice between renting a house out and leaving it sit vacant, isn’t it better for the neighborhood, the city’s tax base, the crime rate, and “affordable housing” situation to have rentals than block after block of those blue (in St. Paul, anyway) “Vacant Building” posters?

I know - that’d require a city government that believed in the market - or was at least well-enough informed about it to hate it articulately.

Cross-posted and comments welcome at True North.