People Are “Frantically Looking For Signs Of A Recovery”
The San Fernando Valley Business Journal reports from California. “Last year at this time, Millennium Pacific Icon Group was selling units at its condominium conversion project in Winnetka at the rate of about 10 a month. These days the company is averaging two to three sales a month.”
“‘Just in our area we saw about two or three more conversions pop up over the past year,’ said Joseph Yoon, project manager for the Forest Glen Villas. ‘I think that is causing a surplus of units for sale.’”
“‘Glut may be too strong a word,’ said Gary Schaffel, whose Schaffel Development Co. is one of the most active independent condominium developers in the area. ‘There’s more (on the market) than I’d like to see.’”
“The slowdown seems to cut across all price lines. Even at the high end, Schaffel’s properties, for example, were selling out in three to four months back in 2004 and 2005. That pace has held up better in markets like Sherman Oaks than in some others, but it still isn’t near the record setting activity at the height of the housing market, even when you factor out flippers.”
“The main culprit, these developers say, is the amount of property on the market. Even for high-end builders, the increased availability of lower-priced condominium conversions is, at the very least, detracting shoppers from making purchase decisions.”
“As of last year, some 1,800 units mostly in the Valley were approved for condo conversions, according to city reports. But the increase in conversions, coupled with some discounting in existing properties, is making buyers wary.”
“‘People have seen some prices go down and they’re afraid that right now is a bad time to invest,’ said Yoon. ‘People are noticing some prices dipping and they’re afraid they’re going to lose money.’”
“The situation in the local area, though certainly weaker, is far less severe than it is on some other markets such as San Diego, where there have been many foreclosures and builders have begun to offer incentives and thousands of dollars in financial credits to induce buyers.”
“‘In San Diego, we’re buying a project from a public builder for probably seven figures under what the builder put in,’ said Lawrence A. Scott, VP at AvalonBay Communities Inc., a builder of rental apartment complexes. ‘They figure if they write down one-third of the project it’s better than getting half back.’”
The Whittier Daily News. “Sluggish growth in the housing sector over the last year has the potential for a negative impact on the California state budget. That’s the conclusion of a report just released by a Sacramento-based think tank.”
“According to the Legislative Analyst’s Office, the number of residential building construction jobs declined by 2.8 percent between December 2005 and December 2006. The LAO projects that construction will decline by another 13 percent this year, as the real estate slump ‘is having a major adverse impact on the incomes of Realtors, developers, contractors and real estate lenders.’”
“‘We’re definitely seeing a link between the decline and the employment numbers,’ said Jean Ross, executive director of CBP. ‘As for what it means for property taxes and sales taxes, there are warning signs on the horizon.’”
“With fewer homes selling, local governments aren’t getting their normal bump from increasing property taxes. ‘A lot of people forget that when you buy a new home, you buy a new tax bill,’ said Jack Kyser, chief economist with the Los Angeles County Economic Development Corp. ‘Los Angeles also has a documentary transfer tax,’ Kyser said, ‘and fewer sales mean less money collected.’”
“But how much of an impact? ‘There’s no question there are people frantically looking for signs of a housing recovery,’ Kyser said. ‘But I think it will be the rest of this year, and in some areas into 2008, before we see it.’”
The Ventura County Star. “Growth is one of the most challenging issues facing Ventura County, but Bill Watkins, executive director of the UC Santa Barbara Economic Forecast, said he doesn’t have any answers.”
“‘A lot of us in the county want to see more higher-paying jobs, so there are things for our young people to do,’ said Charles Maxey, dean of business at California Lutheran University in Thousand Oaks.”
“Increasingly, it’s becoming a norm for every adult in a family to work, Maxey said. ‘We used to say that if you’re paying more than 30 percent of your income on housing, you’re pushing the limit of what you’re spending,’ he said. ‘And now people just expect that they’re going to pay 40 percent to 50 percent of their income, and it’s really stressing people.’”
“The average salary in the county was $46,928 in 2006, up 5.1 percent from $44,670 in 2005. However, incomes adjusted for inflation based on 2000 salaries were lower: $38,300 in 2006 and $38,000 in 2005.”
“Steve Kinney, president of the Economic Development Corp. of Oxnard said he estimates that people must earn a household income of $80,000 to $100,000 to live comfortably and own a home in the county.”
“Roland Cordobes, a financial adviser in Ventura, said he was stunned by the UCSB assessment.”
“Still, Cordobes recommends the county as a place for young families. He stressed that anyone can purchase a home if they have the right mind-set. ‘I think Ventura County is a great place for a young family,’ he said. ‘It’s growing, truly growing. But you have to be determined to make it.’”
“A lot of young people do not understand how to save money, he said. ‘A lot of them are spending $2,000 to $3,000 in rent, yet they say they cannot afford to buy a home,’ he said. ‘I say, if you can afford so many dinners a year? or if you can afford cappuccinos at Starbucks, you can afford a home.’”
“Rents rose 6.1 percent last year, to an average payment of $1,523 per month.”
The Recordnet. “The rising number of foreclosures in San Joaquin County isn’t helping home sellers, because that pumps up the competition, makes it tougher to sell and depresses prices.”
“John Knight, University of the Pacific professor of finance and real estate, said mounting foreclosures depress market prices, because lenders tend to sell low to get rid of the property quickly instead of holding out for the best price.”
“‘My concern is foreclosures,’ said Shane Hart, VP for the Stockton-based Grupe Co. ‘In San Joaquin County, pre-foreclosure notices are three times greater than at the end of 2005. This could translate into increased inventory as these hit the market.’”
Be sure to check out the notice-of-default graph at the Recordnet link.
‘I say, if you can afford so many dinners a year? or if you can afford cappuccinos at Starbucks, you can afford a home.’
There you have it! Just skip the coffee and that odd night at the Olive Garden and you can buy a home in Ventura Co.
‘I say, if you can afford so many dinners a year? or if you can afford cappuccinos at Starbucks, you can afford a home.’
“There you have it! Just skip the coffee and that odd night at the Olive Garden and you can buy a home in Ventura Co.”
Exactly. Skip that $3 coffee so you can make your mortgage payments. This is like trying to save the Titanic with a bilge pump.
That is why Applebee’s is doing so well! LOL, skipping Applebee’s to pay the mortgage…
“Skip that $3 coffee so you can make your mortgage payments. This is like trying to save the Titanic with a bilge pump.”
I’d rather have my $3 coffee than a mortgage payment these days. Freedom is such a great feeling as a renter!
I would take any investor advice from Cordobes with many grains of salt - he admits to having lost money on Enron in an earlier article. This guy always jumps on the sinking ship.
Agreed, though I have to add that Trader Joe’s is awfully empty these days without the home-equity ATM cashout money folks…
I read that article this morning. What a joke.
My neighbor must of had too much Starbucks, because they have their house on the market for 100 grand less than they paid for it.
krills, where are you? Sounds like the market it tanking there.
I’m in Ventura, Ca.
Seeing this in Oxnard and Camarillo also.
It’s only going to get worse….A house 5 streets away sold last month for 474,000 which is 146,000 less than what neighbor paid 2 years ago. This whole bubble got way out of hand. I mean in 1997 I paid 167,000 for my house and no I have not tapped into my paper wealth.
“‘A lot of us in the county want to see more higher-paying jobs, so there are things for our young people to do,’ said Charles Maxey, dean of business at California Lutheran University in Thousand Oaks.”
Can’t they all just get retail clerk jobs at all those “discount outlets” in Camarillo. They pay like 8 buck an hour, and your in the “fashion industry.”
krills,
wow, hard to believe it that bad already. Haven’t seen that discounting yet in the SF Bay Area, may take a while.
Let’s see, a family of five, mom, dad, little joey, suzy, and aunt mable can make 5x$8= $40/hr. That’s $1600/wk x 4.33 = $80,000 per year with two weeks off for vacation. Enough to buy your $400k starter. What’s wrong with that??? Huh??? hehehehehehe
Let me tell you about Ventura County. About 6 years ago the voters approved a proposition called SOAR (Save Our Agricultural Resources). No one can build anything in Ventura County without getting the project approved by a 2/3 voter majority. That’s right. If you want to build a house in Ventura County, you have to put the project on the ballot, pay for a campaign and convince 2/3 of the NIMBY’s that infect the place to grant you permission to use your private property. Now people are bitching about how hard it is to make ends meet in a gang infested craphole like Oxnard (if it wasn’t for all the gangbangers Oxnard would be OK).
“you have to put the project on the ballot”.
You can get it approved quicker if the ballot is Bilingual.
“if it wasn’t for all the gangbangers Oxnard would be OK”
and if Mexico City wasn’t such a shithole, it would be OK too. Gangstas and wankstas are a part of the Cali lifestyle now. Get used to the drive-by shootings, it’s only going to get worse as the state transfroms into Mexifornia in 10 years
.”"Get used to the drive-by shootings, it’s only going to get worse as the state transfroms into Mexifornia in 10 years”"
Amen to that. The neighborhood were I live in Anaheim has become predominately Mexican. They buy $650000 homes and then rent out all the available rooms in order to meet the mortgage. Most of them make minimum wage. In the meantime, this place looks and feels like Mexico. I hear ‘rancheras’ playing loudly at all hours, driveways are FULL of shitty cars (when they’re not working on ‘em), garbage started sprouting up everywhere and no-one seems to have a drivers license nor insurance. Street vendors have started plying their trade from pushcarts up and down the streets and people speak Spanish everywhere.
The kicker is I’m latino myself and a NY’er. But in NY I had DIVERSITY. I could hear Russian, different variaties of Spanish, Polish, Arabic, French, German, Italian and a few dozen others all on one stretch of block.
Here it’s ALL Mexican; that’s IT. It makes you feel like an outsider in your own country.
Bottom line: I pay First World prices to live in a Third World environment in “glorious” Southern Cali.
Ben, my favorite part is where they say that if you are paying $2,000 - $3,000 a month in rent then you can buy. My wife and I pay $2,500 per month. To buy a similar place here in NYC we would be paying $5,000 or more per month to rent the money necessary to feel like owners.
What financial rules would we then be breaking.
1) Diversification of assets: our entire financial future would be tied up in our “home”.
2) No emergency fund: that would be called our “down payment”. Bye-bye safety net.
3) Inadequate investment in retirement: our maximum 401k payments would have to be severely cut back.
Oh, there must be more but you get my point. It’s amazing how little these idiots care about the people they are giving advice. I think there is a “boneheaded advice” bubble in this country right now.
There’s more:
‘When it was custom for one parent to work and one to stay home, families had a safety net, Maxey said. If one spouse were injured or sick, the other could step in and begin working, at least temporarily. Today, there is no backup, leaving people with a diminished ability to be self-reliant about making economic choices.’
‘People think quality of life isn’t about the economy, but in many ways it is,’ Maxey said. ‘If you have more money, you can send your child to a better college and take them on the kind of vacations that help educate them about the world.’
But it is still better to hang it all out there for a house? Even when renting is roughly half as much? The longer I do this, the more I think Californian academics/financial folk are the most clueless in the nation.
Exhibit A as to why I left California. That state is so used up, and increasingly the people who live there are just materialistic morons.
Add to that the out of control spending by the state and local governments ….. I sold my house and am biding my time (renting) until I leave.
“When it was custom for one parent to work and one to stay home…”
This is why we left California. The rich and the poor do it this way, but the middleclass has difficult choices.
Ben,
This is something I’ve been trying to tell people for a long time, now. As two-income households have become the norm, cost inflation has risen accordingly, and the family is no better off. I’d venture a guess that we are not “twice as well off” now than the average family was in 1960, with one income earner.
We live on one income, and will always strive to keep our expenses low enough to do so, even if two of us work outside the home.
Seems people don’t understand the role of two income families and credit where cost inflation is concerned. At some point, we end up being worse off.
The other thing that bothered me with this article is that 2 years ago, Watkins was saying how houses in V.C. were going to appreciate upto 1 million median, so you better get in while the gettin was good.
Watkins was only concerned about supply and demand, or the shortage of housing in Ventura/SB — I think he was completely oblivious and uneducated to what was happening in mortgage financing.
NYCBoy, you forgot to mention this advice was given by Roland Cordobes, a “financial advisor”.
I can remember some years back when Mike Tyson and Trump did a news conference about how Trump was going to be Tyson’s “financial advisor.” MSM ate it all up, big time. Anybody have any hard numbers on how that turned out?
Probably not so good because trump is so desperate he is going to be in a wrestling match with the owner of WWE, Vince Mcmahon, in wrestlemania this april.I hope trump gets his @ss beat.
Mike Tyson is a homeless street bum
http://tinyurl.com/367urv
I seem to recall that it work out so well for Iron Mike either.
LMAO
I seem to recall that it did not work out so well for iron Mike either.
Donald Trump? The guy that declared bankruptcy ON A CASINO?!? How the hell do you lose money on a casino. That guy is a tool.
arizonadude - not correct, neither of them will be “in” the match, just sponsors of actual wrestlers.
Iron Mike may now or may not now be a homeless street bum, but I reckon a lot of people would pay to watch him take on The Donald in the ring.
I’d pay to see Iron Mike vs Rosie O’Donnell
“Mike Tyson is a homeless street bum”
Clearly Iron Mike is a casualty in the War on Savers.
I think the Donald & Rosie should announce their engagement — it would generate lots more press for both of them.
Solution to your homebuying woes - Trade in your wife for one that makes more money.
I think he has this bass-ackwards. “If you buy a Ventura County home, then you will always be able to afford Olive Garden dinners and Starf*cks coffee. Since real estate always goes up, you will always be able to tap into your home equity gains through the magic of cashout home equity ATM financing.”
Saw alot of this ATM activity here in Ventura.
I fully expect those who has refinanced to the tilt to be rounded up during the upcoming wave of foreclosures.
When hard times hit people might start waking up to what a complete and utter rip-off Starbucks has become.
My office pal and I had to work this weekend. So he showed up with a big cuppa Starbucks (which he doesn’t buy during the week). “Can you believe it”, he said, “this cost SIX BUCKS!”
He got the jumbo mocha something or other and because starbucks espresso is no weak he had two extra shots added. Jeez people, just buy a cappaccino machine and some decent beans if you really like coffee drinks!
But I don’t think Starbucks is really about the coffee. It’s about being upscale. It’s like the Coach bags and BMWs and Granite countertops. Average americans working at some scruff paper-pushing job think they should live like little mini-Rockefellars.
The last time I had coffee at Starbucks was 4 years ago. I was stuck in O’Hare airport and there was no other place to go.
I have never had coffee at Starbucks. Best way to quit is to never start, just like smoking.
Friends don’t let friends drink Starbucks.
Imagine burnt coffee loaded up with sugar to the saturation point and you can enjoy Starf*cks vicariously.
“I’ve never had coffee period. Anywhere.”
Nor I. Pepsi — morning, noon and night. But not 10 cans.
The coffee industry has a chart that describes coffee types and roasting. Starbucks is in the “medicinal” area of the chart.
Starbucks drinks, the ones that are drinkable anyway, are desserts. Drink too many, and you gain weight…quickly. Learned that lesson and have stayed away ever since.
I’ve never had coffee period. Anywhere. The stuff grosses me out.
Coffee smells pretty good - and tastes like someone left the wash in the grounds. Starbucks was never a temptation on any level.
The closest I ever got was Kahlua… love my White Russians!
I wonder how people with Starbucks and/or smoking habits have money left for anything, let alone homes.
And I thought I was the only one who couldn’t stand a cup of Joe. It’s kind of odd, but I don’t like any hot drinks at all. Tea is leaf soup as far as I’m concerned, and I prefer cold, congealed chocolate in bar form to anything hot. I get my caffeine from sodas, which is probably the very worst way, bar none. Oh, well.
Ditto. I”m no saint, I probably put away 10 Diet cokes every day.
I knew someone who downed 10 or so diet cokes a day for a decade or so. At age 60 she dies of a brain tumor. - Yeah I know, could have been anything… but I doubt it
….bone density issues have been identified…. I’ll stick with my coffee, thanks (the good stuff)
I always thought coffee smelled great but tasted like tree bark.
Last year I got a free taste of some coffee in Hilo, on the big
island of Hawaii, and it was actually not horrible! Kind of like dark chocolate, but not as sweet. I don’t recommend paying the 18 bucks a pound it costs, but I do recommend going to the farmers market in Hilo and getting some free samples. I also recommend the rambutan, jaboticaba, star fruit, and surinam cherries - good stuff!
No coffee? I… cannot understand it.
While I rarely buy starbucks (maybe once a month) I LOVE what they have done for the US coffee market. The variety and quality is amazing. Not to mention they removed the cigarette smoke from the coffee houses.
But I agree its overpriced. Cest la vie. I spend my money mostly at Trader Joes for their coffee. But… they have replaced two of my favorite beans with substitutes… that I don’t like. Again, cest la vie. Cosco now has a Summatra that I really like.
But most of all…
Got popcorn?
Neil
Coffee and popcorn? Doesn’t seem to fit…
It may not be the best tasting beverage, but I probably would not post here much if it were not for coffee…
I absolutely REFUSE to patronize Starbucks unless I am given a gift card. It is such a SCAM!! I can’t believe the lemmings that line up to buy this overpriced crap!! Hell, you can go to the local gas station and get a coffee or capccino(sp) for half the cost! Everyone should read “Automatic Millionare” which says for the daily cost of these overpriced coffees you can end up with a pretty large retirement savings. People are STUPID!!!
Don’t flame me, I’m just the messenger.
http://www.ziopedia.org/content/view/578/58/
You cannot paint with such a broad brush. I like to get a specialty coffee on many mornings (Starbucks is NOT my favorite). So I’m stupid? Give me a break. You have to consider a persons entire monthly budget in order to make such accusations regarding their spending behavior. The drinks happen to be pretty much the only “luxury” item I afford myself. It costs me per month, roughly the same amount as one round of golf at a decent resort. But I suppose in your book, all golfers are stupid as well. And the same with skiiers, concert attendees, fairgoers, moviegoers, diners, and on and on and on. Get a clue.
Starbuck’s, like any other little luxury, is neither good or bad. We all need to choose what will constitute a good lifestyle for us. If you want a Starbuck’s in the morning, you can afford it, and it makes you feel good, then I say, “go for it”. If you do it just to keep up with the guy next to you then shame on you.
My wife and I spend a fortune on going out. I can’t imagine what our bar bill is a year. But we are very financially responsible. We don’t do a lot of things that other couples might like to do and we don’t have kids. We love going out.
So, you see, most generalizations are pretty lame. Live your life how you want to live it, just don’t expect anybody else to pay your way. Well enough preaching, we’re off to a bar on Houston Street to listen to some music. Have a great night everybody.
To me starbucks is a cheap form of luxury.I usually get a venti passion iced tea for 2.00.A drink at the bar is about 4-5 bucks so what the hell.I do not splurge on the other drinks that often.Their coffe is horrible I think.I’m actually quitting coffee drinking, been clean for about a week.
I can understand Starbucks for coffee junkies. A quality espresso machine can be quite expensive and having someone do that labor for you while you are on the go can be justified.
But their tea? The best thing you can say about their tea is that it is passable. Their chai has no cardamom to speak of (get real chai at an Indian restaurant — you will see what I mean) and Tazo is just upmarketed Lipton as far as I am concerned.
I have had the passion ice tea lemonade. It is okay, but I don’t think it is worth the price. I put it the same category as Arizona — better than nothing, but not ideal. But then, I am a Southerner by birth and am an ice tea junky. I brew about a gallon and a half of sweet tea a week; I drink it like my friends drink Coke.
I love starbucks. I very, very rarely drink any of their coffee, but, God, do I wish I invested in the company when they first went public. Whoever can convince so many people to drink a $5 cup of coffee deserves my applause (and not care). If I only had that much creativity.
#1 Pet Peeve of mine: Young gal (or guy) in a Chevy Suburban, Starbucks cup in left hand, cell phone wedged between ear and shoulder making a left turn at a busy intersection.
Really not making the turn…
Broadbrush, cha cha cha.
I like Peet’s.
Me too. One opened up next door to us. And then, of course, Starbucks had to open a store right across the way. I guess they are afraid of a little competition.
BB
Lighten up. It sounds like their just having fun.
It’s all fun till someone loses an eye.
A guy’s balancing the checkbook and yelling at his wife for all her little expenditures. She says “well, what about your bass boat?”
He says, “Honey, I NEED the bass boat!”
I guess the worker bees NEED their six-dollar javas to endure the eight hours in the cubicle, eh?
Oy vey. It’s just coffee, and the regular stuff is not so bad. People get so into hating Starbucks because they are ubiquitous, and it’s somehow cool not to drink there. I thank God for Starbucks–they helped spark a trend of great coffee in the states. The crap at gas stations usually sucks, come on.
Yes, Pete’s is better, or the little shop run by angry vegen lesbian anarchists, but Starbucks fills a need. If you are making minumu wage and getting a venti fancy something or other they do not have in Italy–ok, you are probably an idiot. But gettin’ the occasional cuppa is not the end of the world nor will it lead to the breakdown of western civilization.
while I dont really like starbucks coffee as it tastes nasty, I have to say it is not that expensive, a buck fifty for small coffee, any where else costs about a dollar and tastes even nastier. so while I dont like their coffee, I have to give them credit for providing somewhat better coffee than average. The best coffee I had in my life (Im a major coffee drinker) is the blue cup of coffee you get on the street in NYC, which they dont have in damn LA or OC). so I mostly make my own coffee—YUBAN
now the fancy shmancy drinks at starbucks I dont know!!!
“He got the jumbo mocha something ”
Was it ‘Non Fat?”
Some comedian (can’t remember who) once said that you could tell how big an @ss*hole someone was by the number of variations on their Starbucks order. “Triple latte, have no fat, half 2%, double shot…etc…” Always seemed to be pretty accurate to me.
How long will it be before BigBucks has the same stigma as your neighborhood Burger King?
I stopped at S-Bucks this morning to get a cup for the drive to DIA. I really overslept. Anyway, I thought $1.75 was a little steep for a plain cup of coffee until I found out the lady in back of me paid $21.50 for four super deluxe fuffy drinks for her and the kids. Said it was breakfast.
Again, you’re not buying the product, you’re buying the advertising. That $5 is not payment for a cup of whatever, it is payment for the right to associate oneself with the Starbucks brand. It allows others to see you walking down the street, or sitting in a coffee shop and associate you with the brand and its image.
You have it wrong. This is secret breakdown:
Marketing Costs per Cup: 7 cents,
Coffee: 5 cents.
Cup: 5 cents.
Little corrugated, all recycled, fiber “heat protection sleeve” that goes around cup:
2 DOLLARS AND 23 CENTS
Imploder, you got that right. I manufacture corrugated boxes and housing in Tijuana.
You are paying for the atmosphere I think.Their stores are always clean and designed well.I think people like to feel good once in awhile so they go into starbucks for the atmosphere.It is not about the coffee or other drinks but the atmosphere I think.I will drive out of my way to go to a clean, well maintained gas station myself.I really like the Quik Trips around here.They run a good business and are always clean.You go to places that represent your vision of being treated well.
Hot looking women, usually with a full compliment of teeth to boot. Nice way to kick off a day and you get a fancy coffee drink for free in my book.
Az
Ahh…., what other establishments do you visit?
This can be said about many products. Two identical products can be shown to someone with two different labels and the more expensive label will evoke a sense of better quality even the though the products are exactly the same. It’s been proven in studies. Consumers are quite gullible.
I personally pay the two bucks for a cup a coffee many times a week, and tip a buck on top of that. Who cares? We all have our vices and preferences.
How about the idiot that “needs” a truck or SUV and really could get by with something safer getting 2-3x the gad mileage. Those people, in my opinion, are gullible idiots. The same can be said of the person that buys a new car every few years, or the person that spends exorbitant amounts on clothes or a trophy house.
Face it, we live in a consumerist society and consequently all piss away money in one form or another.
Most Americans are idiots when it comes to being aware of the market and market forces. Henceforth the negative savings rate, among myriad other societal problems.
This can be said about many products.
It can be said about EVERY product!
As for paying for the atmosphere, I would argue the atmosphere, furnishings, etc. inside a Starbucks is part of the advertising. Advertising encompasses more than a billboard or tv commercial. Packaging is advertising, a store layout is advertising, logos are advertising, even the choise of font is advertising.
Most people get the Starbucks to go or use the drive-thru’s now, so the atmosphere doesn’t matter. The 99 cent cappucinos I get from the gas station convenience stores taste better. I think it’s just an expensive status symbol that you piss out in an hour.
I agree, we as a consumer society are total suckers. My favorite two examples:
1. flat-front pants for men. All of a sudden the fashion industry says “pleats are lame” and we all go and change in all of our perfectly good pants.
2. flat-panel televisions. WTF is this whole thing about??? My good friend who can barely afford his $900/mo apartment just replaced his perfectly good 32″ tube for a 42″ LCD. He said “it’s only $1600 and I have no payments or interest for 3 years”. I asked him what shows he was watching that I couldn’t watch on my tube tv. He didn’t laugh. This has to be the biggest sham in the past 50 years. My friend says “dude, you can see the hairs on the back of Mickelson’s neck”. WHAT?? Never in my tv-watching life have I been sitting there watching and thinking to myself “gee, I wish my TV were more clear so I could see people’s acne scars”. Marketers have done a double-trick on this one, because first they had to convince us that our other tv’s were somehow blurry, and then they had to convince us that it’s normal for an AVERAGE working stiff to pay $1500-$2000 for a freaking TV.
rant over. sorry.
Does anyone here have any fun at all? Do you all do anything other than swim around Scrooge McDuck style in your gold and currency? I know I’m cheap and all but I can certainly allow myself and others a few frivolous luxuries (all the better if I spent as little as possible on but for goodness sake, it seems like everyone here has the goal of spending as little as possible and looking down on everyone who spends a thin dime more. You can’t take the cash/401k/stock portfolio with you, and at some point someone is going to “waste” it on a host of ultra frivolous luxuries if you just keep passing it on to your progeny/foundation/bury it in your back yard.
I take lots of vacations and bought myself a massaging chair. I always look for a bargain though. Starbucks doesn’t qualify.
I have a truck; I don’t drink coffee but I do buy SBucks iced tea when I can’t get ahold of a diet Coke; I don’t rent OR pay a mortgage; I’m in positive savings territory; I take vacations; and I don’t even like to shop for fun. I think I have a lot of fun! and oh, I’m a California native, born and bred for 50+ years, and happy to be here in NorCal. AND, I’m a nice person. I think I just don’t fit in here.
“All of a sudden the fashion industry says “pleats are lame””
Uh-oh, when did this happen? Oh well, I mostly wear jeans to work…
“Do you all do anything other than swim around Scrooge McDuck style in your gold and currency”
Well let’s see. Today we went dune sledding with the kids…we took two twenty$ plastic snow sleds (a saucer and a ‘torpedo’) and slid down the 50 foot sand dunes next to Oso Flaco lake. We also had picnic of fried chicken, celery and carrot sticks, and Doritos. We had a blast, got some sun, and a good workout to boot. After the kids went to bed, we rolled around in our vat of federal reserve notes and gold coins. Tomorrow we plan on foreclosing on some widdows and orphans.
‘Does anyone have any fun’ my @ss.
Yes, it’s not the $3.00 at Starbucks per se that is the problem, it’s the over-arching ethos that money means nothing and overpaying is perfectly acceptable as long as we get what we want precisely when we want it.
People don’t go broke because they buy coffee at Starbucks, but spendthrifts who waste their money are also quite happy to waste some of it buying expensive drinks at Starbucks.
Exactly. A Starbucks addiction can be an affordable little luxury for the right person. More often, though, it’s just a symptom of someone who has no idea how to manage their finances on any level. It’s the big ticket items rationalized by the same value system (the I want it now no matter what the cost and someone will lend me the money to do it system…) that bleed them dry.
Gee guys… I like the taste/smell of the starbucks coffee
I get a tripple expresso with a little heavy cream…. 2.08$
Pretty good coffee for the most part. I also normally grind my own at home with Sumatra roast from Trader Joes (love my bitter dark roasts).
I can’t stand a weak coffee made at too high a temperature (McDonalds)…
I’d give up the starbucks for some good Arabian (or Greek) style coffee… Even pay three bucks
If SBucks was using generic all-white coffee cups, how many people would think the liquid is still worth $5?
i buy a grande brewed coffee for $2.05 almost every day. whatever the extra bold blend is. It’s 2 to 3 times as big as that $.75 or $1 cup at a diner or a bodega or whatever your local cheap place is.
i like it because it’s 100% arabica beans and it’s whatever kind of coffee they say. the cheapo places are a blend of whatever is the cheapest that month.
Yup. Me too. I usually get a medium for around $1.75 plus $1.00 tip. That’s less than the cost of a beer.
I drive a ten year old VW (when I don’t ride my bike to work), have a god-knows-how-old television to watch movies (no cable/tv at all), buy mostly used furniture,…I could go on. So what’s the big deal?
I love coffee and will gladly pay a premium for a decent blend. Personally I do not like S-bucks, but will shop there above getting regular crap coffee. And also, many shops here in Wash have free refills in house.
I sold over 5,000 cups of coffee a year and the paper cost is higher than the actual coffee. Gross profit on a $1.35 cup was $1.23….then again, we had the guaranteed lowest cost from suppliers so our margin was extraordinary. Still, coffee carries the highest profit margin of any item on a restaurant’s menu.
I hate the taste of that crap and wouldn’t drink it under any circumstance.
“But I don’t think Starbucks is really about the coffee.”
From whence, then arises that emulation which runs through all the different ranks of men, and what are the advantages which we propose by that great purpose of human life which we call bettering our condition? To be observed, to be attended to, to be taken notice of with sympathy, complacency , and approbation are all the advantages which we can propose to derive from it. It is the vanity, not the ease or the pleasure, which interests us.
– Adam Smith —
(written in the year 1759)
Look. I can taste a diference or i’d not do it.
Coffee, liquor, wine, fine peice of @ss… Some people apreciate it and some just don’t
Seems like a marginal utility discussion in here.
I think I stumbled onto the wrong blog…wasn’t there a housing bubble page around here somewhere? LOL
The same drinks at 7-11 taste better and cost 99 cents
The same drinks in my Mr. Coffee cost a quarter.
Sorry to inform you Jerry, but 7/11 coffee is absolutely terrible. I would take a nice cup of drip regular coffee from SBucks for 1.68 than a piece of $hit 7/11 coffee anyday.
This I have to agree with. If you cannot taste burnt coffee… I agree, don’t buy Starbucks.
But as others have noted, pick your luxury.
Its much more stupid to spend $50 on drinks on a Friday night in a bar than buy a mocha here and there.
But… I love my coffee.
Also…
Got popcorn?
Neil
I really don’t care. Ask me if my net worth has been growing by leaps and bounds since 1989 and I don’t care if you laugh while I spend $4.65 for a blueberry muffin, two dark chocolate squares, and a Vente Drip. I enjoy it all.
I decided to but in…I drink lots of coffee (have for about the last 25 years) and love nothing better than a bold cup of fresh brewed. I’ve drank coffee in visiting places ranging from Hawaii to Kenya and Starbucks is right up there with the best of them. I don’t buy the wussy fancy drinks that everyone is talking about (the $5 ones)…but as far as good ol’ coffee, they brew a great cup at a reasonable price. Gas station coffee is disgusting and doesn’t come close. Lately I buy my Starbucks roasted beans in the Kirkland packaging at Costco for about $5 a pound…same stuff and lots cheaper and brew my own. Starbucks fills a niche…and if you don’t like it, simply don’t go!
What, exactly, is the nutritional value of coffee?
It’s full of antioxidants.
Cappucino is good for my bunghole!
Hey Beavis
I’d like to think that I’m somewhat of an expert on coffee. I own a “high end” espresso machine, and (no disrespect to anyone) I can probably make the best cappu/latte/espresso around here.
That said, I visit starbucks sometimes, usually when I can’t make it home. Are they as good as mine? Not a chance. But it’s pretty decent, and most drinks are well-priced, assuming you like coffee and not flavored milk.
I’ve noticed two types of people that bash starbucks. One group doesn’t like the flavor or price, that’s fair enough. The others (and usually most vocal) are the anti-capitalists, who see them as just another big company to hate. It’s easy to tell who’s who, as the first group has to be asked before they give their opinion
I believe we’ve reached a bubble blog milestone. The better part of a thread devoted to — coffee.
When do we do shoes?
Buy the stock and let other people buy the coffee. A few years later with the stock up strongly, the coffee will taste really good at Starbucks.
“Average americans working at some scruff paper-pushing job think they should live like little mini-Rockefellars.”
High hats and narrow collars
White spats and lots of dollars
Spending every dime
For a wonderful time
- Puttin’ on the Ritz
The whole “latte culture” here in Seattle is sickening. Zombies with paper cups…
i got a kick out of being in Starbucks surrounded by a bunch of liberal yuppies types. I found it ironic that the exotic names and locals of the coffee were a literal catalogue of western imperialism.
I you want to buy coffee at the grocery store (evon though my store now has a Starbucks inside) I suggest Cafe La Llave.
It is a green label but not decaf. Esspreso ground especially for the latin taste. It is really great from my 4-cup drip.
Paul
“‘There’s no question there are people frantically looking for signs of a housing recovery,’ Kyser said. ‘But I think it will be the rest of this year, and in some areas into 2008, before we see it.’””
In other words, I don’t see a light at the end of the tunnel. Sure hope there is one.
Hey, I see a light. It’s coming fast. Shi!t, I hear a whole bunch of noise too. Look, it’s a freight train.
Warning, get off of the tracks (Sell,Sell,Sell)!!
Except, they’re all in a tunnel. Getting off the tracks is a big no-can-do.
And this isn’t a situation where one only needs to be the fastest runner.
You either make it out of the tunnel…
Or your hamburger meat is scrapped our of the machinery at the next service interval.
As grisly as this scenario sounds… people see the light and are running towards it. (Holding their homes off the market.) Pretty soon they’ll realize that light has tens of millions of pounds moving at a pace that… proves a lesson in momentum.
Got popcorn?
Neil
local governments aren’t getting their normal bump from increasing property taxes….
That’s the friggen mind set of state & local municipalities…..Gee’s, we are not getting more money so we can piss it away….What are we going to do ??…I will tell you what you do….Starve the beast…..
We have multi degree twenty & thirty something’s that are making far less money then some shmuck reading a water meter @ some muni AND on top of that they get ground hog day off with pay (sarcasm)…
AND, what about the firefighter that works in my community that makes around 10K a month, works eleven days in a row and then fly’s back to Arizona to his “Real Home” for the remaining 21 days…..
I am sorry, but when I see government “Whine” about not getting the expected revenue that they anticipated it just really pisses me off…They have no concept or could give a rats ass of what the private sector must go through to make ends meet….
Yep you got that right
I’m with you scdave,
Starve the beast…..
I work for one of those muni’s. It’s bloated, inefficient, inept, corrupt, and wasteful. Yesterday the little IT guy showed up and replaced my perfectly good computer with another new perfectly good computer. When I asked why it was being replaced he said “it’s on my list”. When I asked if I could buy it he told me no, and dumped it in his recycle cart.
I always warn new employees not to stand in front of an exit door at 4:59. You’ll get your a$$ run over.
The reason for that is many places lease IT equipment because it is cheaper and they don’t have to deal with the disposal
Thank the Unions for the Holiday pay. I thank the California Nurses Association for all the benefits we deserve.
Unions suck, however I love nurses.
Once, when I was sick, I took a turn for the Nurse.
Unions still suck.
I agree dave.I am totally disgusted with them and pay them as little as possible.There is a lot of waste there and they all get paid great.
Since public sector pensions are massively underfunded, it will be interesting to see how local and state governments plan to carry the costs of retiring teachers, firemen, cops, etc. I expect those expensive pensions with full medical benefits will start getting trimmed when the boomers start retiring en masse. There just isn’t the money.
They need to allow more Starbucks.
That’s the friggen mind set of state & local municipalities
Ahem. That’s your mindset. You elected the governments.
Know what the real problem was in CA? Property taxes were capped for sitting homeowners by Prop 13, so they could elect free-spending local governments, enjoy the services, and let the new buyers get stiffed for higher taxes. Only works when property values keep going up though. The Ponzi scheme is over.
I don’t live in CA and don’t want to, so don’t accuse me of whining about Prop 13.
A few years ago the damn firefighters let San Diego County burn to the ground. The people called them heroes. I call it not doing your job. I can’t stand gov’t workers.
Paul
Here is my California Bubble story. I rent a 3BR house in Berkeley for $2000 a month and I have a roommate John who pays $500 of this. John is a 45 year old PhD student who has been working on it for 3 years now. His total income comes from the University as a teching assistant and fellowships. He owns very little furniture or other household items. For various reasons I recently decided I wanted to live alone and asked John to move out. I thought he would look for another room in a house or maybe student housing. NO, he has decided to buy a condo loft in Oakland’s fruitvale, and these start at $400,000.
It makes no sense to me, but his logic is that long term California real estate goes up, so he needs to buy now. He has perfect credit and a little bit of savings, so he qualifies for a big mortgage. His relatives are telling him how much they have made on the appreciation of their homes. Welcome to new paradigm of 21st century finance. A phD student can rent a room for $500, or borrow $400,000 to buy his own house, even with little verifiable income. What a choice, why would anyone choose the room when they can have their own house with no money down.
I thought new Ph.d’s assumed they would move to anywhere in the U.S. that they could find a teaching position. Competition for teaching spots at Bay Area universities must be intense, but he’s not concerned?
Not all Ph.D. go that route. I finished in 2005 and decided I wanted to stay in LA, but knew I had little chance of a tenure-track position. I was a shoe-in for a high-level university staff job that would normally be taken by a masters-level person, or someone who had a lot of experience. On the side I took an extra appointment as a lecturer in the math department to enjoy some teaching. I am very satisfied, so perhaps that’s his thought, too. Not everyone even wants to do research, and even though the Ph.D. trains you to do it, that training is also valuable in the real work world.
“Degree creep” is exactly why I decided that academia was not more me. (Although I’m glad to hear it worked out for you…) In my field and school, master’s degree staff positions were being filled by candidates with a Phd and decade of teaching experience. In order to make tenure track, you needed to do post-doctoral work. I just wasn’t willing to sell away that much of my life to be one in a pile of resumes. I’ve found the world outside of academic walls is better - more “Darwinian” perhaps - *grin*, but still a slightly saner place.
In 1990 my work organization sent me to a post graduate school on a weekday to talk with a faculty advisor for a phd program. This was on the heels of my earning an MS degree. I wanted to research into cognitive science and learning. They wanted me to work in robotic vision, which I didn’t have an interest. They would have paid my way, provided I study what they wanted me to study. I would have had to quit my job to to the phd route. I decided then an MS degree was enough for me. These days, I do not regret not having a phd. It would have been nice, but I took a different path in life and I thoroughly enjoy my career now - a traveling software engineering consultant.
Good decision Bill,
That guy sounds like a poor lost soul. 45 years old and in graduate school and still not smart enough to tell when the relatives are full of Sh&^! He will be 50 before he starts earning anything close to a decent salary and very little that would begin to pay for a $400k condo. I did the big degree late in life. It was the right decision for me personally. However, I know several very bright friend who passed on the PhD because it just did not make sense for them, given the return to poverty, lost savings, and a general shortage of doctorate level positions in the places they wanted to live.
Ph.D. is almost never cost effective. I completed in 4 years and that was considered fast, and I’m sure I lost at least 200k in wages over that time, plus the actual cost of the degree at ~50k. The masters is usually enough in the marketplace except for a few specialized careers.
I like your characterization of “degree creep.” That’s exactly what it is. But I don’t see this as bad. My boss is ecstatic with my work. It’s all because of my training to think about problems critically and the experience writing a book doesn’t hurt when it comes time for a project that involves a lot of writing.
To each their own!
I hope it’s not a PhD in economics or finance.
LOL!!!
“NO, he has decided to buy a condo loft in Oakland’s fruitvale, and these start at $400,000.”
Sounds like John is trying to ‘get stucco’ in Oakland.
Being well educated, having good math skills,and anylytical skills is no longer a recipe for success. Applying logic today doesn’t work in a illogical world. It doesn’t work for me anymore, I just seem to miss opportunities(housing)(stockmarket) ,logic said street people couldn’t buy mcmansions….I was wrong and once again proved myself to be a educated idiot. I seem to throw the illogical out of my equation as beeing insignificant, only to realize later how significant it was. The more educated I become the less I seem to Know. There are too many jokers or wild cards out there now. Will housing crash? Will street people own more stock than me with a new arm margin account? I can only wait and see what happens in this crazy world
The craziness all started when a total retard who barely speaks correct English and until late into his life was an alcoholic, became President of this country.
It’s been DOWNHILL ever since
Is the President the cause or just another symptom?
A symptom. People liked (note past tense) Dubya because he reminded them of themselves.
We have met the enemy and he is us.
Right on! I met a trucker once who was proud of the fact that he was a functional illiterate. He also said he liked “W” because “he talks just like me”. Problem is, our country is filled with lots more just like him, ergo “The Decider” living on Penn Ave.
It started with the dotcom craze when Amazon stock hit $450 and eToys hit $90. They told us that earnings amd numbers don’t matter anymore. People quit good paying jobs to daytrade and lost their savings when the mania ended. All that money moved into RE. Now it is moving back into the stock market and the indices are bulletproof.
Location, location, lo–Fruitvale?! He is about to get a much more precious education than he ever bargained for.
I work with a guy who lives there.
He is a witness to 2 murders and has to go to court to testify in both cases, since no one else saw anything.
“he was stunned by the UCSB assessment.”
“Still, Cordobes recommends the county as a place for young families. He stressed that anyone can purchase a home if they have the right mind-set.”
———————————————————————
A stun gun is now standard issue for RE agents, buyers need to be stunned into having the mind-set to sign on the dotted line………..
I only buy Starbucks when I’m traveling. My brother told me recently it costs 50 cents for a Starbuck Coffee refill. I keep the cup and take it to any Starbuck’s on my way to the bayarea. I won’t give them anymore money than I have to.
“it costs 50 cents for a Starbuck Coffee refill. I keep the cup and take it to any Starbuck’s “….
You are single handily tipping the economy into recession! How many others are closet ‘refillers?’
No, LV is going to buy a coast-view home with the savings.
Oh, I totally do this all the time.
And to be fair, regular Starbucks coffee isn’t that expensive - it’s the specialty espresso drinks where they make their money. Regular coffees are about a buck and half. Get a few refills and it defrays the cost a lot. Toss out the old cup after a few times and reuse the new one.
I’ve seen homeless do this at fast food places. Snatch an discarded cup off a table and fill’er up.
Ain’t that the truth.
You needn’t be homeless to take advantage of this trick. Heh-heh.
Homeless people drinking Starbucks. I love it!
Friday, February 16th, 2007 was “Black Friday” for the subprime mortgage industry. We saw investors pulling out of the market this past week but Friday was the tipping point. We have not yet seen the bottom in the subprime market (which accounted for 20% of originations in the past year) and this will drag down the entire housing market. Don’t look for a bottom in this segment but rather recognize that there will be many subprime lenders that go out of business in the next three months.
I agree the ABX BBB- and BBB look bad, no question about it. By what I can see, any mortgage co. or investor holding those are taking a bath. Also any mortgage co. that has loans warehoused waiting to be sold are not feeling very good. My question is…with the tightening in the credit markets, what % or which type of loans have really been affected thus far(tightened standards) i.e. sub-prime, Alt A, Payment option ARM,100% LTV? Any insight would be appreciated.
Subprime are much harder to get but at least they’re made to real borrowers. ALT-A is the scary product. These are the don’t ask, don’t tell mortgages used for investment properties. These mortgages are starting to see a lot more delinquencies. CDO’s are the real disasters waiting to happen. Inexperienced portfolio managers have loaded up on BBB subprime tranches, got the blessing of S&P or Moodys and sold them to hedge funds. These guys have never seen bad times in their lives (since they’re only in their 20s). The market for such products has exploded in the last 2 year and was responsible for explosion of subprime mortgages. Without CDO’s you could not get a 1M subprime mortgage with 540 FICO and no-doc. Get ready for a bumpy ride.
IMHO this friday was not a watershed, the spread is still less than 500 pts and the hedges are still in place. Until the hedgies throw in the towel because of expanding volatility, the major subprimes lenders will be business as usual with even more profit. Just an observation seen in the past.
I don’t see the hedge funds clinging on to this stuff much longer. They have some intelligent people there who can see that the waves of buy-back demands will cause cascades of bankruptcy, and the steep decline in prices and values will cause shareholder and investor litigation. They’re holding potatoes which have suddenly become hot. Somebody is going to lose big here, and the fastest on the draw will lose the least. This will cause a rush for the exits. Remember the adage they trade under: Don’t panic, but if you must panic, be the first. If there’s no up side, and there’s a big down side, someone will break for the door, and soon.
I think the dollar volumes in subprimes were understated. Half of the loans last year were subprime.
“Steve Kinney, president of the Economic Development Corp. of Oxnard said he estimates that people must earn a household income of $80,000 to $100,000 to live comfortably and own a home in the county.”
Better make more than that if you have kids. Of course you can rent.
No way. You forgot to factor in the HELOC that you will qualify for to pay for anything else you need. The ownership premium!
“Steve Kinney, president of the Economic Development Corp. of Oxnard said he estimates that people must earn a household income of $80,000 to $100,000 to live comfortably and own a home in the county”
Yeah thats if you dont want to do any thing else but have a house there-no vacations, few other possessions etc.
“Joseph Yoon, project manager for the Forest Glen Villas.”
Forest Green Villa. A block from Saticoy and Winnetka which boasts about 3 straight blocks, starting at that corner west down Saticoy, of aging and decaying 60’s and 70’s apt buildings, overcrowded and crammed full with recent immigrants. Unfortunately, The building owners apparently prescribe to the “they’re slummy people so why bother with upkeep” philosophy. And some GF is suppose to tie his future financial fate to that type of environment?
Yea, right.
Oh, and looked on the Condo’s web site. One of the “Amenities”…
“Numerous Laundry Facilities on Site”
WTF? 10% of the units no washer dryer hook-ups!
Even in the most frenzied of markets these “Condos” would never be mostly owner occupied. Gee, I really wanna be stuck in an apartment I own!
“The situation in the local area, though certainly weaker, is far less severe than it is on some other markets such as San Diego,”
Whoa Nellie, Mister, You just give it a year….
“A lot of young people do not understand how to save money, he said. ‘A lot of them are spending $2,000 to $3,000 in rent, yet they say they cannot afford to buy a home,’ he said. ‘I say, if you can afford so many dinners a year? or if you can afford cappuccinos at Starbucks, you can afford a home.’”
Looks like this guy wants people to give up everything in their lives just to buy a home and make him wealthy.
Buying a home is great….paying $2-3K a month rent is no more stupid than paying that much for a home each month.
Buying a home is great….paying $2-3K a month rent is no more stupid than paying that much for a home each month.
And at least when you rent you aren’t losing money each month on a depreciating asset!
Backlash for BoA giving out credit cards to illegals:
http://news.yahoo.com/s/kgtv/20070217/lo_kgtv/11039022
I know some people living in Rancho Cucamonga who bought several houses over the past three years or so, two coming mid last year. They wanted to sell one of them, the one they live in, but claim that they pulled it off the market because they would not sell it for anything less than 1 million. This is one of those huge box like houses. Anyone knows what these type of houes in cucamonga, CA might be really going for?
Excerpt from NY Times Feb 18th article, “The Psychology of Pricing”
Buyers, in turn, parry by deconstructing the price. They aim not merely to assess a dwelling’s fair value but also to plumb a seller’s bottom line and vulnerabilities. How a price tracks with similar properties, how large and hasty any reduction is, and even how parsed or rounded a number is — all these are grist for concluding, rightly or not, whether a price is firm, desperate or a sign of painful dealings to come.
Or even a sign of delusion.
http://www.nytimes.com/2007/02/18/realestate/18cov.html?ref=realestate
Back from Vacation - what did I miss?? Wife didn’t let me bring the laptop - LOL
ResMae Bk!
Read the LATimes article in Tuesdays newspaper at the airport!
Welcome back!
Executive Summary: Housing still too expensive and Starbucks is a rip-off.
The universe is unfolding as it should: prices are falling; flippers are skewered on the kabobs of their own greed; Casey Serin is now claiming to be the father of Anna Nicole’s baby; Donald Trump licensed his name to Al Qaeda for an undisclosed sum; and Britney Spears shaved her head and legally changed her name to P. Mustafa Ishtar.
I like the rethink comments…
from Bloomberg-
Housing starts in January fell to an annual rate of 1.408 million, the lowest level since August 1997, from a revised 1.643 million the previous month, the Commerce Department reported yesterday. The median estimate of 75 economists surveyed by Bloomberg News was for a yearly pace of 1.6 million.
“There was a general sense that housing had stabilized,” said Amitabh Arora, head of U.S. interest-rate strategy in New York at Lehman Brothers Inc., another primary dealer. “This will cause some reassessment of that view.”
Condo conversions make sense if there is rent control. The san ferndando valley’s condo glut is not going to stop and it is hurting renters.