One last parting note about this poorly conceived hit piece which attempts to lay everything at the feet of black pathology and dysfunction. It’s wrong in every way. I’ll cite some sources which may helphttps://quillette.com/2018/07/19/black-american-culture-and-the-racial-wealth-gap/ …
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First, consider historical credit markets. As
@MarthaOlney has shown racial discrimination in even basic credit markets would have made it impossible for blacks to get into serious debt. You have to be extended credit to do that and that didn’t happen.1 reply 2 retweets 42 likesShow this thread -
Blacks were only extended credit when there was collateral, which in historical credit contracts was easy for the lender to repossess.https://www.cambridge.org/core/journals/journal-of-economic-history/article/when-your-word-is-not-enough-race-collateral-and-household-credit/D2E52122527DB8A1A8B6F7E3619114E8 …
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Second, blacks had very high savings rates historically. This was first noted by Tobin (1951) “Relative Income, Absolute Income, and Saving” where the high rate of saving was (once again) due to discrimination.
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Third, the access that blacks did have to wealth building were predicted on racial discrimination. Blacks were more likely to be homeowners in highly segregated areas. But these homes were also of lower cardinal quality and in areas where black home prices were falling.
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Replying to @TrevonDLogan
This point deserves further elaboration—was the fall in home prices exogenous? If the home prices were falling, they were higher before, which would imply higher past rates of wealth accumulation, no?
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Replying to @matthews_bd @TrevonDLogan
If the home ownership base started out white, and they sold at declining prices to black buyers, it’s possible (depending on the slope of the curve fitting racial composition to home price) that the white residents lost more—what does the curve look like?
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Replying to @matthews_bd
That’s a counter factual— the white homeownership rate was increasing at the same time. Also, you’d need to consider losses relative to inflation and the fact that subsidies made the new homes cheaper as supply was outstripping demand in white suburbs.
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If supply was outstripping demand, prices went down. Inflation shouldn’t have a disparate impact here, except insofar as white homeowners were more hedged. But white people also own (proportionately?) more finanacial assets that *aren’t* hedged, like bonds and pensions
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