50-year mortgages, falling real wages, and doing your rideshare due diligence

Ramblin Keith Roemer, I accept.

Keith, I believe that this is indicator of the week time.

50 year mortgages and how the rideshare app in your pocket may be taking more money from you than you know.

Yeah, not great news, right?

But Darian, lots of other signs in the economy still look strong, right? The stock market's booming, unemployment is relatively low. Consumer spending has been going up all year.

The letter K here, right. The lines for the wealthy are going up and up and up and the lines for the poor are going down and down and down.

All right, thank you, Darian. Waylon, what do you have for us today?

the U.S. i guess this means it's time to pour one out for our uniquely American 30 year mortgage.

That's a whole extra house.

We should say. Right? The administration is already walking this back a little bit. Right?

All right, Darian, for this one, I need a little participation from the listeners. You here, can you please take your phone out?

I want you to open up your favorite rideshare app. You right now are at our bureau in Manhattan. Yep. Look to see how much it would cost you to get home to your apartment.

It's expensive, but it was really easy. Right. Like, and what I had you do, that is what most people who use one of these apps do. They open one app, they get a price, they wait for their car. But Darian, according to a new National Bureau of Economic Research working paper, that is a big mistake. Because of course there is more than one ride sharing app and those apps often have different prices for the exact same route. According to estimates in this paper by Jeffrey Fawcett, Michael Luca and Ye Jia Xu, New York City's Uber and Lyft users are spending $300 million a year more than they need to.

If they just compared prices, took Lyft when it was cheaper, took Uber when it was ch. $300 million in total savings.

No, they do not. The authors found that of the people who opened one of Uber or Lyft on any given day, only about one in six even bothered to open the other app.

And in some instances. Right. It makes sense not to comparison shop. Like, forget Uber and Lyft for a second. Like, if you're talking ice cream stands in your town and there's two of them, but they're 10 miles apart. Right. You're not going to drive back and forth to make sure you're getting the best price on ice cream. And this is an example of what economists call a search friction. You know, time or lack of information or distance, anything that keeps you from making the best, most economic purchase.

on my 10 millimeters apart. Yeah, they're not 10 miles apart, they're 10 millimeters apart. So the search friction here is, I guess, laziness. Also, apparently people do less searching around on mobile devices compared to computers because the screens are smaller, so it's harder.

Waylon, we're just saying millennials and older people.

As a member of the older people, I'm not sure how I feel.

Keith, I need to. I need a bath. Okay, I'm going back to the paper. The paper importantly says this for all members of all ages. If users would just comparison shop between Uber and Lyft, they would probably save themselves about 14% a ride on average.

Check both apps, folks. Check both apps.

Thanks for having me.