In Good Faith With Philip DeFranco

Episode: Why You Can’t Afford A Home w/ Maxinomics (Phil Rayton)
Date: December 23, 2025

Episode Overview

In this insightful discussion, Philip DeFranco sits down with Phil Rayton, also known as Maxinomics, to examine the complex forces making housing increasingly unaffordable in the U.S. Their conversation goes far beyond real estate, touching on everything from the actual causes behind high housing prices and the impact of AI on the workforce, to modern monetary systems, the reality of tariffs, and the economics behind Ticketmaster and concert pricing. Throughout, Rayton brings data-driven clarity, often challenging mainstream narratives, while DeFranco plays devil’s advocate and voice of the everyday listener.

Key Topics and Insights

1. What’s Actually Making Housing Unaffordable?

(00:11 - 07:53)

The Real Cost is in the Land

• Land vs. Structure Cost: In major U.S. cities, up to 70–80% of a home’s value now comes from the land—not the house itself.

  “If you demolished the house, you could still sell the property, the piece of land, for 70 to 80% of listing price.” – Phil Rayton (00:40)

Is There a Housing Shortage?

• Housing Units Per Person: Contrary to popular belief, the U.S. has more housing units per person than ever before. In 1970, it was 0.342 homes per person; today it’s 0.432.

  “The idea that there is a housing shortage on a national level is just false.” – Phil Rayton (03:54)

Household Size & Single Occupancy

• People are occupying homes differently: in 1965, only 8% of homes had a single occupant; today it’s 29%.

  “There are fewer people living in each house. And of course, that makes sense… they're staying single longer, they're not having kids for a much longer period of time.” – Phil Rayton (04:44)

2. Are Institutions Like Blackstone to Blame?

(07:53 - 09:36)

• Private Equity’s Role: Blackstone and other investment firms own less than 1 million out of 142 million U.S. housing units—overstating their impact.
• Short-Term Rentals: Airbnb and similar platforms account for 2.4 million units, often in desirable areas, which has a more significant (but less villainized) effect on supply.

  “If you wanted to point a big finger, it would be more at short-term rentals, which is harder to do because we all use them.” – Phil Rayton (08:44)

3. Zoning, Regulation, and Rent Control

(09:36 - 20:01)

• Biggest Bottleneck: Overregulation and restrictive zoning are the largest impediments to increasing supply—not removing vacation rentals.

• Rent Control’s Side Effect: Major cities like San Francisco (77% rent-controlled) and New York (40%) stifle building incentives, leading to less new supply and market distortions.

  “Rent control, especially in these kind of markets, completely demolishes the desire to build.” – Phil Rayton (10:47)

• Solution Controversy: Rayton advocates phasing out rent control over years instead of abrupt removal, citing the Supreme Court may soon weigh in on these policies due to constitutional challenges.

  “This could become a national issue. And if the Supreme Court hears, it would be interesting.” – Phil Rayton (19:14)

4. Free Market, NIMBYs, and Displacement

(13:41 - 20:42)

• Free Market Tensions: Rayton supports market-driven development, recognizing that local pushback ("NIMBYism") is hard to solve and often thwarts needed density in desirable places.

  “Everybody kind of wants their thing to stay their thing… I get that that's not a good mindset for helping to build, but I think it's one that the majority of people have.” – Phil Rayton (10:37)

5. How Will AI Change Work and the Economy?

(21:19 - 35:41)

• AI Adoption Curve: AI’s rapid adoption in tech/engineering is driving huge productivity gains; token usage (units of AI ‘output’) has increased ~50x in a year at Google.

• AI and Knowledge: AI can process and summarize vast information, but lacks deep “real-world” cognition—knows about a banana, but not what eating one is like.

• Limits are Physical: The next leap for AI hinges on data center and energy (power) infrastructure.

• Unstoppable Momentum: Geopolitical rivalry and the ‘arms race’ make AI development inevitable, even if imperfect or controversial.

  “The cat’s out of the box. Pandora’s box has been opened... that fear alone will be enough incentive to drive it forward.” – Phil Rayton (28:34)

• Practical Advice: AI isn’t flawless; “triangulate” responses across multiple tools, never rely blindly, and always verify critical information.

  “The better way to look at ChatGPT and all the bots isn’t as an instant answer… it aggregates all [the info] for you much faster.” – Phil Rayton (33:38)

6. The Gold Standard, Debt, and Modern Money

(37:41 - 45:43)

• What Was the Gold Standard: Every dollar used to be backed by government-owned gold, which limited lending and economic growth.

• Why We Left It: The system restricted credit; going off the gold standard allowed modern economies to use debt to stimulate growth.

  “All of the people… that think we should return to a gold standard. Are they just kind of delusion posting?”
  “Yes. But I say that without out judgment. It is a delusion.” – Phil DeFranco & Phil Rayton (42:24)

• Debt as Economic Driver: The modern world runs on debt—used carefully, it enables progress and risk-taking, not just living beyond our means.

7. Ticketmaster, Swifties, and Ticket Pricing

(45:43 - 50:47)

• Are Tickets Undervalued? Yes, as evidenced by massive profits in the resale market. The true “market-clearing” price is much higher.
• Possible Solutions: Only allow resale on official platforms with strict price controls or tie tickets to photo ID (but this damages flexibility and convenience).

  “Artists aren’t going to like it… the solution is to limit ticket resale to just the Ticketmaster platform or prevent resale entirely.” – Phil Rayton (47:35)

8. Tariffs: Tool or Bludgeon?

(50:47 - 60:52)

• Tariffs as Leverage: The massive, sometimes “sledgehammer” approach (blanket tariffs) was strategically necessary to force trade renegotiations; revenue is politically appealing.
• Mixed Results: Tariffs brought China trade practices into public debate and raised government revenue (~$400 billion), but also triggered targeted inflation and bailouts (e.g., for farmers).

  “I would prefer to not have tariffs in a free market… But in order for there to be a free market, it's got to be free market amongst all trading partners...” – Phil Rayton (56:11)

9. Manufacturing, Jobs, and Automation

(58:10 - 65:55)

• Manufacturing “Coming Back?” More likely, the U.S. will spur new, advanced manufacturing (think robotics, not jeans), especially if tariffs persist long enough to foster such investment.
• Automation’s Role: History suggests new technologies spawn new industries and types of work, even as old jobs are lost.

  “That kind of manufacturing isn’t coming back… I think the right way to look at it is bringing back manufacturing from a ground level of building the next era of manufacturing in the United States…” – Phil Rayton (61:58)

10. On Nvidia, China, and Tech Policy

(64:19 - 65:55)

• Chip Sales to China: Allowing some U.S. chips into China can slow their domestic alternatives by locking them into the U.S. tech “stack.”

  “It's a strategic move to disincentivize China to make advanced chips, which actually they would struggle to do anyway for supply chain reasons…” – Phil Rayton (65:09)

11. Maxinomics' Backstory and Process

(66:12 - 73:26)

• Phil Rayton’s journey: High school stock trading, poker, software engineering, writing, then video—eventually being acquired by Morning Brew.
• Creatively, Maxinomics picks topics based on insight and impact (not personal convenience), focusing on what will be most meaningful to the audience.
• Rayton is self-taught, driven by curiosity, and resisted the slow pace of traditional education.

12. Favorite Video and Creator Insights

(73:26 - 77:59)

• Ticketmaster/Taylor Swift Video: Rayton’s favorite, for its creativity, relevance, and the surprising economic revelations around ticket scalping and VPNs.

  “There are segments in there that are so good… The reason you see so many VPN ads is they don’t all do this, but many of the big ones do [resale your computer’s bandwidth].” – Phil Rayton (73:42)

Notable Quotes & Memorable Moments

On Overstated Institutional Blame

“The faceless organization of BlackRock is very easy to blame… But if you wanted to point a big finger, it would be more at short-term rentals.” – Phil Rayton (08:44)

On Rent Control in Cities

“Rent control… completely demolishes the desire to build.” – Phil Rayton (10:47)

On AI's Inevitable Ascent

“Pandora's box has been opened… that fear alone will be enough incentive to drive it forward.” – Phil Rayton (28:34)

On the Gold Standard

“Are they just kind of delusion posting? – Yes. But I say that without out judgment.” – DeFranco & Rayton (42:24)

On Tariffs

“I would prefer to not have tariffs in a free market… But in order for there to be a free market, it's got to be free market amongst all trading partners…” – Phil Rayton (56:11)

On the Promise (and Limits) of Manufacturing

“That kind of manufacturing isn’t coming back… it’s about building the next era of manufacturing in the U.S.” – Phil Rayton (61:58)

Funny Memorable Moment

“When I was in my most Emotionally vulnerable state… you had flip phones that even if you took a photo, you're not even really sure necessarily what you were seeing.” – Philip DeFranco (35:41)

Timestamps for Key Segments

• 00:11 — Main causes of housing unaffordability
• 03:54 — Debunking the national ‘housing shortage’
• 08:44 — Airbnb vs. Blackstone impacts
• 10:47 — The distortion of rent control
• 19:14 — Supreme Court and rent control future
• 21:19 — The coming impact of AI
• 28:34 — Inevitable global AI arms race
• 33:38 — How to responsibly use AI
• 37:41 — Gold standard, debt, and modern money
• 42:24 — Returning to the gold standard = “delusion”
• 47:35 — Solutions to ticket resale and scalping
• 56:11 — Tariffs as economic leverage
• 61:58 — New vs. old manufacturing in America
• 65:09 — Nvidia chips, China, strategy
• 73:42 — VPNs, scalping, and the 'hidden' tech economy

Tone & Language

The episode is frank, highly analytical but conversational, with DeFranco asking probing, relatable questions and Rayton patiently “debunking” or elaborating with economic realities and data. Jokes and personal anecdotes (often about millennial life) keep it engaging, while candor and nuance pervade the discussion, especially on contentious policy ideas.

Conclusion

This episode is a masterclass in seeing beyond simple narratives on housing, economics, and technology—challenging listeners to reexamine what drives affordability and change in America. Rayton’s arguments, supported by data and unafraid of controversy, make for a thought-provoking listen (and a handy reference for modern economic myths).