Bits Bucket For November 15, 2008
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Thinking about moving to Fort Collin CO. Any thoughts on the housing situation there? Thanks
Haven’t been there for years, though I did my undergrad at Colorado State. But way back then, the best places IMO were Old Town (near the university) or little farmettes (5 acres) towards the mtns and the Poudre River. The Poudre has been known to really rage, though, so keep that in mind, possible flooding.
www dot brayandco dot com will show you all the MLS listings if you select Larimer County. Too darn cold there for me, most of Colorado’s Front Range gets more severe weather than the rest of the state (points west, anyway). Good luck, no more LA maybe, huh?
whoops, the LA Peter is Peter m, IIRC
I haven’t been there in 35 years, but I liked it when I was there. Check out the small mountain communities close by as well. If you’re into shrooms there used to be a variety of Amanita that grew in Estes Park that was popular among the long haired set.
|-)
Median household income in the county has dropped 12.5% since 2000.
Nowhere as many foreclosures as in nearby Greeley, but that could change.
I woke up today to astonishing news. There were wildfires and high winds in the hills around Los Angeles. I sure hope they were smart enough to build multi-million dollar homes there, before the fires got there. Who would have ever thought there would be high winds and wildfires in L.A.? It’s as unthinkable as a hurricane hitting Florida or New Orleans.
The problem is that they are running out of land, so they have no choice but to build there. And since people never age in California, and nobody dies, they must do it in a place that will burn, sink, or shake.
Build, build, build!
Do it noooww. Vee are runneeng auwd of tie-mmmm.
“We know nuthing, nuthing.”
Oh bull crap! Homes on the sides of hills are like boob jobs down there. It’s all about lookin’ good.
“Homes on the sides of hills are like boob jobs down there. It’s all about lookin’ good.”
I thought you were going to say: homes on the sides of hills are like boob jobs, they’re going to sag eventually.
“Build, baby, build…”
I drove back from Pismo Beach Friday morning and the winds were treacherous comming out of San Luis O……During the three hour drive we must have seen 100 fire trucks heading North to South on Hwy #101
I’ve been watching the Sylmar fire, and the winds are howling so much, that aircraft can’t fight it and have to be grounded…
Are there people talking about The End Times in California? I’m serious. People always attribute all bad stuff to god, not to subprime lending and overbuilding.
Out in the Redondo Beach area, people are carefree. No fear about fires in that part of LA. But wait til the “big one” hits. Somehow I feel safer on the top floor of my apartment building. My car in the underground garage will be crushed from the cars above though.
From what I’ve heard, nobody in California believes in God, so they must hase another scapegoat.
Let’s see, yes, I’m one of those liberals who do not believe in God (thank god!). So my scapegoat is fire?
Somehow I feel safer on the top floor of my apartment building. My car in the underground garage will be crushed from the cars above though.
—————
Having lived through the ‘94 Northridge quake, I think you are making a wise choice to live on the top floor. From what I saw, it was always the bottom floor that got crushed.
OTOH, I refused to live in a multi-story building until ten years later (and still don’t like it). One thing for sure…if we ever do buy another house, it will be a single-story home.
Earthquakes suck!!!
‘I woke up today to astonishing news. There were wildfires and high winds in the hills around Los Angeles”
The fire most making the news is the one in Santa Barbara County near Montecito. Montecito is the enclave of the rich and quite lush and verdant. It is about 5 miles south of city of Santa Barbara . SB is very prone to the effects of drought and has had a history of having severe water shortages . I wonder if this is what caused the conflageration to spread so rapidly and devasate 100+ homes. And these are million $ estates, not cracker shacks.
Not all of the homes in Montecito are estates. Some of them are rather modest structures that just benefit from being in a highly desirable location. And not all of the people in Montecito are rich. Some of them are hardworking folks who just happen to have homes that sit on very valuable land.
It’s actually a rather modest place that embraces a more subdued, Greenwich (CT) approach to wealth, unlike the the more ostentatious communities ringing Los Angeles. And except for the threat of wildfire, it is a very sustainable community–actually the opposite of the suburban tracts that define our recent residential growth.
The Tea Fire was the result of fierce hot dry winds in thickly wooded canyons. These fires are going to come. It’s always just a matter of time. I do think, however, that much more attention could be given to designing fire resistant landscapes and structures. If I were fortunate enough to own a home in Montecito, I would want it to have a shock absorbing foundation, fireproof siding, and a rooftop wetdown system. This technology does exist…
“Not all of the homes in Montecito are estates. Some of them are rather modest structures that just benefit from being in a highly desirable location.”
It sounds like it. There’s nothing like a good fire to raise the price of real estate.
Story on that blaze mentioned a family caught behind a nonfunctioning electric gate. Strange Darwinism was playing out there as the flames closed in until that gate that could not keep out Mother Nature, also failed to resist the powers of … nope, not Bruce Willis … but Rob Lowe! Talk about checking in/out but never leaving!
And no one thought to just run down the gate? Probably didn’t want to scratch the Escalade.
I think the Montecito fire is up higher in the hills were its dryer and all the homes have big fences and ” beware of attack dog” signs. Many years ago I live in Montecito but closer to the ocean while my dad flipped a house there on old country road. I do remember my friend S. Holister his mom was unhappy when she learned I was of the working class living in one of her favorite homes in Santa Barabra.
“I had no idea Airline pilots made so much money” Well I was 13 and the think the mansion cost 110K back in 1973.
And yes Airline pilots do make alot of money like 100K back in the day. Almost as much as CA firemen on overtime which they are sure getting now.
There’s another school of thought that says DON’T BUILD IN LOCATIONS THAT ARE PRONE TO PREDICTABLE NATURAL DISASTERS.
Sammy — Trouble is, you are pretty much talking about the entire state of California. For instance, upwards of 80 pct of the portion of San Diego County more than five miles inland burned at some point in the 20th century. And then there is earthquake, flood, drought and mudslide risk to add to the list. This is a very geologically active part of the world, and disaster risk comes as part of the deal for those who choose to build or live here.
Having moved to Alaska after largely growing up in The OC and San Diego (and also the years I lived in Providence, Seattle, Montreal, NYC, and Chicago), I constantly get guff from family and longtime friends in California about leaving “Paradise”. How can anyone not love the hot dry weather and those cooling Santa Ana winds? Nothing is more wonderful than diverting Colorado River water to make the desert bloom!
However, it would be insensitive of me to criticize their place of residence in return, considering they are going through a (frequent, recurrent and predictable) natural disaster. How could I? California is clearly the Center of the Universe. It’s different there…
“California is clearly the Center of the Universe. It’s different there…”
At least you can brag that Alaska has bigger earthquakes than California.
And don’t forget, Alaska has whatshername, who I swore I would never mention again.
She’ll be back!
Well, I’ll have to move to Alaska when that happens to get away from her.
Who has the better Governor? One is kind of dimwitted, with a hoky accent and a curvacious body. The other one is Sarah Palin.
B-b-but my governor is hotter than your governor!
I mean, criminy, your governor would pay money to sleep with my governor…unless he was blind, of course.
It looks like climate change is really affecting his wife. Her face is melting faster than the polar ice caps.
My governor is blind. And, my last governor did pay money to sleep with some one.
That’s why NY is the center of the universe….not those wanna-be’s in California. Only NY’ers can ruin the world’s financial system.
my last governor did pay money to sleep with someone
http://en.wikipedia.org/wiki/Eliot_Spitzer
PB, the strongest recorded quake you guys in Californiky had was that puny 8.0 quake in 1906, and it about ruined ya!
But what do you expect from all those girly-men in San Francisco?
It takes a real man to survive a 9.4 earthquake like the one we had in Anchorage on Good Friday in 1964…rebuilding from that was a piece of cake!
Something that always amazes me about those fires.
It seems that every single time I see those fire on teevee, it shows a shot of a house with about 10 feet of yard behind and then brush about 4 ft deep all behind the house.
Why don’t they just mow a little further out? Hello?
For up to date news on the fire, go to the live feed at KTLA TV.
(google it)
CC
Actually, from the photos it appears that this area of north San Fernando Valley burning is mostly older mobile homes and the assortment of tract house stock from the late 50s and early 60s, you know, 1,000 sf stucco boxes with scalloped roof edge trim and cramped backyards bordered by pink brick walls you see when you travel through LA on Amtrak. Pretty much the polar opposite of Montecito.
Poster from I-tulip this morning:
Strip mall of the near-future:
1. Euthanasia parlor.
2. Gambling parlor.
3. Private vest-pocket prison.
4. Amsterdam-style cafe where you can have a drink, a cup of coffee, or a joint and think the whole thing over.
Talk about your United States of Amurica service economy!
A Classic song for our time:
http://www.youtube.com/watch?v=uTCQSk2l8bc
By gambling parlor, did you mean stock broker?
“Strip mall of the near-future:
1. Euthanasia parlor.
2. Gambling parlor.
3. Private vest-pocket prison.
4. Amsterdam-style cafe where you can have a drink, a cup of coffee, or a joint and think the whole thing over.”
… already envisioned in “Children of Men.”
regarding the Amsterdam part: a bit outdated I think; even in Netherlands it seems that the more-or-less legal coffeeshop has had its best time.
The Dutch have had enough of this (both the trouble caused by the shop visitors, and the illegal plantations all over the country) and politicians are finally taking notice. In my area they are now debating a system with electronically controlled access to the coffeeshops, where only locals can buy and both buyers and the shop have a strict limit on what they can buy/sell within a given time.
Hopefully this would prevent the major troubles that are caused by drugsrunners (95% from outside Netherlands) and make the business less attractive for big criminals. There is even talk again about making ‘wiet’ production legal, also to get rid of the criminals in the scene (but don’t count on that in the near future, due to foreign interference and of course the drugs mob itself that is quite happy with the current situation: easy money for them).
Man…..next thing you know, they won’t be putting mayonaise on their french fries anymore.
Or is that Paris? I keep forgetting.
Andrew Saunders of the Saunders Report says he is also bullish. On Nov. 3 he opened his own “state of the art” real estate shop, Saunders Associates, in a spruced-up former furniture barn along Montauk Highway in Bridgehampton.
While he admits he “would have preferred to launch in a more dynamic period,” he says that brokers are still busy with showings and that he is prepared — with a $7 million investment — to ride out the bad times.
http://www.nytimes.com/2008/11/16/realestate/16lizo.html?_r=1&ref=realestate&oref=slogin
Blessed are the knifecatchers.
for they shall keep the bankruptcy attorneys from going out of business
How does a real estate broker finish with a million dollars?
By starting out with seven million dollars.
It’s just like the publishing business, a good way to make a small fortune from a large one.
For they shall inherit the asset price deflation.
… and their generous sacrifice of liquidity to the System will help ease the downward path.
…and smart enough to insure said McMansions through the likes of AIG et al.
For those of you, like me, that need a moments break from the insanity (Stop the insanity!), check out this adorable baby manatee:
http://www.savethemanatee.org/mom&calf_harding.jpg
Is that the one that sounds like Alec Baldwin?
“Is that the one that sounds like Alec Baldwin?”
No, it’s the motivational speaker Susan Powter — the person whom Baldwin is jokingly apeing.
“Last year was the deadliest year documented for manatees with 417 recorded deaths. According to manatee mortality data from the Florida Fish and Wildlife Conservation Commission, the leading known cause of manatee deaths was from boat strikes, with at least 92 killed in 2006. There are over one million registered boats in Florida along with another 500,000 boats from other states that also share the waters, putting manatees, other aquatic wildlife, and the boating public at risk.
Around 3,000 manatees exist in Florida waters today, and they are listed as endangered by the U.S. Fish & Wildlife Service.”
Dang, Floridians, do you really need that many boats? We could use manatee deaths as a metaphor for corporate layoffs: (417/3000 = 14%)
The manatee has no predators. It dies mostly from boat propellers. Git ‘r dun.
That will be another bizarre bubble indicator: a decrease in manatee deaths from boating.
http://www.flickr.com/photos/ulrichp/1362599/
It appears that power lines are a manatee hazard as well.
Jeezloise, that is SO cute. We need some of those in Utah, all we have are carp, a few trout, and an occasional squawfish (which maybe they don’t call that anymore, seeing how they’re trying to get rid of the term squaw as it’s now considered to be politically incorrect).
I saw the sophomore art show at the Corcoran this week. One of the sculpture students created a manatee (general impression, not realistic) out of wood and gave it a partial suit of armor. A little like the horse armor a knight’s mount might wear, though he kept it much simpler than that. It was wonderful. I’m still smiling as I think about it.
The good news is that you see a “Baby”…
I think I dated the mother, one time, back in ‘96. It might have been twice.
Are you saying that could be your grandbaby??
Is there some way we can remove a comment, have a cuppa mud, then repost?
sorry, Lost - that one goes down on your permanent record.
shoots!!!
Oh well, I guess it probably was one of my brighter comments…
‘Are you saying that could be your grandbaby??
We should have Fish and Wildlife personnel examine the darling little baby. Is it surly? Does it have a cutting wit? How about an enlarged liver?
Those would be verrrry telling clues.
Yeah, except he was having the affair with its MOM. LOL!!!
…a long time ago…I dunno, do manatees have really long gestation periods???
Muggy,
Did you take that picture yourself? Very cute!!!
I stumbled into an office of a co-worker yesterday. He had a real estate magazine on one of his cabinets. The headline was about crashing NYC real estate. They compared Manhattan to Icharus, flying too close to the sun. I was tempted to put it on the desk of the co-worker that told me how dumb I was not to buy. The devil in me wants to do it. The angel says “no”. My angel currently has a record of 3 wins and 2,942 losses. I’m tempted to move it over, first thing Monday morning. Or maybe I will just let the a–hole find out on his own and hide from me.
He should get a kick in the jimmy just for telling somebody to commit financial suicide. Hmmm, that I might do. I sense another loss coming for that little angel.
“They compared Manhattan to Icharus”
Kid Icarus was one of the greatest NES games. A sort of Greekish version of Metroid.
http://www.mywii.com.au/img/game/large/KID-ICARUS-4.jpg
Allow the angel to win. Present him with a sympathy card instead of the magazine.
Can I jam the card in his face when I give it to him? That way it will be like a tie. Both of the little fellas can be happy.
Naw, don’t be so crass. Just remind him that he is not alone, that there are millions of people just as stupid and foolish as he is.
Offer up ideas as to how he can help overcome his obvious failings in this, his hour of need. After all, what are friends for?
I can at least remind him that his house in Long Island is losing value as we speak and that his wife is still a b*tch. Right?
That would be the more sensitive and less crass way to deal with it, for sure.
You could, but that is not the customary place to jam such things.
Isn’t a sympathy card in this context REALLY just a schadenfreude card? Devil still wins.
“Devil still wins.”
Sometimes the devil comes around disguised as an angel, an vice-versa.
Your well-meaning best friend can do you in by offering to you bad advice while your worst enemy can save your a$$ by eagerly
pointing out why you are a fool.
Napoleon: “Never interfere with an enemy while he is making a mistake.”
I’ve always believed that a healthy serving of crow always makes for a just dessert when one’s nutritional intake has consisted predominantly of Kool Aid and one’s own cake.
No need to kick him in the jimmy, just give him a lifetime supply of jimmy hats so that they don’t procreate and teach the future generation how to be stupid. Jimmy Hats are the new Joshua Trees.
I say, catch and wrap up your little angel within the magazine, much like a sort of celestial burrito, then hand it to your co-worker with hot sauce and make him eat the whole thing. Only THEN should you kick him in the jimmy.
No, no, no, don’t do that! It will end the schadenfreude way too soon. Allow the event to be prolonged into a process - one that goes on and on and on …
I’m with combie.
Schadenfreude is a dish best served out in little drippy-drip doses.
I went to the local Home Depot today to get something. Upon walking through the door, I couldn’t help but feel angry at all the people that went wild at HD back in 03/04/05 with countertops, remodeling, etc, and now that it’s time to pay for it, want to socialize the payments and have everyone else pick up the tab. HD is a great proxy for everything that was wrong with the last 7 years.
In other news, I was able to score a great deal on some used and new furniture to complete my house. The showrooms are begging for customers.
“HD is a great proxy for everything that was wrong with the last 7 years.”
So is Starbucks, The HumVee dealerships, Best Buy, and Williams-Sonoma.
The HUD-sucker proxy
They’re suckers, alright!
Never before have so many people woken up one morning, and said, “Gee, I think I’ll put a financial bullet in my head.”
The HumVee dealerships ??
Those are what I found the most egregious
I live in a popular destination for tourists driving Hummers, lots of 4 wheeling here. Used to see them a lot, now, almost never. The ubiquitous Jeeps and Toyotas still come, but no Hummers.
the big beasts are still multiplying like rabbits here in Netherlands; maybe it is the most effective way to suggest that you are wealthy and don’t give a damn about petrol prices?
Hardly any Hummers over here, they are really too big for some of the small Dutch streets and for most of the parking spaces. Also I think that Hummers are socially a bit too unacceptable here, unlike other gas-guzzlers.
U.S. Open, Harvard, Ben & Jerry’s, Apple
03/04/05?
At least once a week, my wife and I sit and talk about the mania of 2002-2006 as if we were suffering from flashbacks or post traumatic stress disorder. Looking back on it, it seemed as if we were transported to a parallel universe…. another planet. What a nightmare.
You know, Ex, the whole USA is going to be suffering from PTSD soon.
Going through my files, I just found an article put out by the CEPR (Center for Economic Policy Research) in November 2005. It’s titled “Will a Bursting Bubble Trouble Bernanke?”. Some really good reading as it may seem.
I’m in a lot of denial about the situation. More aptly, I cannot believe that we were right about this mess, and now not only was I diligent in my purchases, either I now help pay for others or watch the whole house of cards tumble down. It’s like being stuck between a rock and a hard place. It all came to me today at the Home Depot store.
Speaking of Hummers, I haven’t seen one on the road for a while.
“Speaking of Hummers, I haven’t seen one on the road for a while.”
Well that would be because the used house salesfolk have no clients to drive around.
More and more often, I will just pull over onto a one-lane road’s shoulder and allow some tailgating crazed lacrosse mom, empowered lawyer, or drunken hillbilly pass me. I’m amazed at how frequently these anger-management challenged drivers give me wild-eyed looks even after I get out of their ways. Happened on Friday night, on my way home. It was a Hummer; didn’t see the driver. However, I prayed mightily to come around the next bend, and to see the H2 on its side. Didn’t happen; never does. Oh well, maybe some day if I keep praying. Have a nice weekend!
We were filling up our 2002 Mazda Protege the other day, and there was a big, cream-colored Hummer Hog filling up on the other side of the pump from us. We filled up half the tank with less than $ 20, and she was still chugging away on filling her pig up. She was filling it when we got there, and still going strong when we left, and she didn’t look to happy. I would have loved to have known what her total bill was. And this is when gas is down to $ 1.97 a gallon ( now it’s $ 1.85 at the cheapest place we saw it today ). It must have been a house payment for her when we were paying $ 4.25 a gal. around here.
‘,,,, or drunken hillbilly pass me.’
Well, then, get out’n the way, then. Sweet Baby Jeebus, man, can’t you see I’m coming along?
I’ve noticed a lot more people are actually filling their tanks again; don’t know if anyone else noticed but when gas was $4.50 about 95% of the pumps I pulled up to had just pumped exactly $10 or $20 worth…. that’d only get you about 20-40 miles in an H2 unless you really babied it (and how many H2’s drive conservatively - or any full size SUV for that matter?).
Now I have an F-150 single cab work truck (V6 manual, though, so I get an honest 17.5 mpg mixed) and in June I paid a peak of $88 to fill it up, which in reality was no big deal because I’m pretty frugal and have a high income (the truck is 7 years old and long since paid for). It has a 25 gal tank (usually takes around 20 gal when the light comes on); I’m pretty sure H2’s have about a 35 gal tank, which would be around $130 to fill when gas gets back to $4.50…. and nobody that buys an H2 is frugal so you know they can’t afford it…. I guess they just hit the station every day to drop in their $20 worth…. pretty funny.
Moman…
A related tale from Lowe’s, a HD cousin. I’m buying some carpet at the register. Manager asks for ID. OK, fine. Here is is. “We are checking IDs more these days,” he offers. “Not surprised,” I may have mumbled.
“Why just today,” he adds, “we had someone come in with the worst looking fake ID I have ever seen. He had cut someone else’s picture and glued it to the license.”
“What was he buying?” I ask.
“That,” he said, gesturing to an electric generator that he said retailed for $800.
So fraudster flees the store upon questioning.
“Shoplifting is way up, too,” the manager says, returning my license.
US RETAIL SALES TAKE RECORD FALL was headline in the local fish wrap.
Another irritation, real quick: Walked through the paint department to maybe get some gallons for child’s room. I asked for “aquamarine” as requested at home. “We don’t have that color,” came the response.
Customer service much?
No, not much.
Proceeded to checkout.
Dude could have jumped over his paint counter and flashed a smile and some alternate color names: nautical, marine mist, or whatever.
Customer service is loss center. It has been calculated that being rude and stupid to your customer is more cost effective. Much like cutting the budget of your QC dept. Cheaper to send the defective product back than make it right in the first place.
Why? I don’t know. I’d have to ask some MBA who
worksworked on Wall St.From my last visit to Circuit City, I would say slack-jawed imbecility is the order of the day.
Didn’t you get the memo? Customer service is a cost center.
In my twenties, I worked for B of A. They used to have young, bright, good workers. Not anymore. Try calling them sometime. More likely than not, you’ll get some uneducated, mumbling idiot who knows NOTHING about banking. It’s a joke.
I haven’t read the Wall Street Journal in a month of Sundays, and just finished reading a copy…
It’s just a Murdoch mouthpiece, with the occasional article of substance that sneaks in, somehow.
Let’s make a movie about Ruppert. We will call it Consumer Murdoch since we are no longer citizens. It will feature a boomerang that he calls “Cramer”, named after his girlfriend’s butthole. I smell an Oscar in the works.
I smell something too.
Why read the WSJ when you can watch Cramer?
Checking out the Realtwhore(tm) dot com site this morning, I noticed that the cheapest condos in south Leominster MA (a few miles east of here) just dropped from mid-50s to low-30s within the past week. They had been parked at that mid-50 level for something like 6 months or more. There’s nothing like that sweet smell of seller capitulation in the morning.
The MAR folks still haven’t realized the strength of the consumer pullback in spending. Do they honestly think anyone wants to buy anything more expensive than a pizza right now, especially when everyone’s wondering if they’ll still have jobs next week?
Someone on this blog (months ago; forgot who) I think nailed it correctly by saying that we’re probably not going to see the bottom of this mess until 2013~2014, and that the bottom is going to be long, low and wide.
“the bottom is going to be long, low and wide.”
deep and wide like a glacier cuts a river valley.
“Someone on this blog (months ago; forgot who) I think nailed it correctly by saying that we’re probably not going to see the bottom of this mess until 2013~2014″
I think that was the majority of posters. In 2006 I was saying that 2013 would be the bottom, to my co-workers. They thought it was a most humorous prediction. Now when I bring up the fact that I still feel the same, they look like they are going to cry. Who’s laughing now, marthafocker?
I’m standing with a range between fall 2009 and spring 2010 for the trough. Recovery will take a few more years afterwards though, so I don’t expect any meaningful appreciation until 2013-2014, and then only at the rate of inflation.
Starting around 2013, all the baby boomers will begin selling McMansions to downsize, and who the hell wants to buy those monstrosities?
The Alt A reset wave isn’t until 2010.
Hangovers usually last longer than the party.
I have been saying 2012 will be the real estate bottom. But if we taxpayers are on the hook to pay mortgages for distressed areas like some officials are trying to push for, I would say the bottom won’t be reached until 2015, the midterm of the President after Obama.
Obama will still be in office in 2015.
I do wonder. He was elected by an angry group. Angry groups turn and devour their own pretty quickly. Presidents cannot just be nice folks with good intentions, they have to deliver the goods. and the goods are not there. People will be pissed. Again.
NYCBoy is probably right - at least 2013 for the bottom, maybe later. We’re in for the Mother of All Derecessions. As somebody put it on NPR, this may not be the Great Depression, but it will be the Not So Great Depression. If GM and Chrysler really go down, which they probably will, it’ll probably throw the country into a depression. Most people don’t get that yet, but they will. Soon enough.
that still sounds good compared to Europe mainland where the downslide is just starting. At this rate, this bottom in EU will not be in before 2020 or so
“Someone on this blog (months ago; forgot who) I think nailed it correctly by saying that we’re probably not going to see the bottom of this mess until 2013~2014, and that the bottom is going to be long, low and wide.”
It could have been me. My take: Demographics are the driver in a consumer driven economy. The last two bubbles would have never happened without the 80-million+ baby boomer cohort, IMHO. There was simply too much accumulated wealth that the financial sharks simply couldn’t resist chumming the economic waters.
If my jackhole fellow Boomers had thought it through a little bit more, they would have asked themselves what they were going to do with a 3-4-5,000 sq ft house AFTER the kids moved out. And what might happen to prices if there were more houses than buyers.
From my personal experience, the only time that the kids need their own bedrooms is between age 10 and 18 (or when they move out). They are usually fine sharing rooms younger than that. Between 10-18, seperate bedrooms are a means to protect YOUR sanity.
As for having “room for visitors”. You are better off putting up visitors in a nice hotel, instead of paying for a monster house to accomodate occasional visitors.
I don’t know, the parking lots at Applebees, Max & Ermas, Texas steak house, and the local Southern smoked ribs chain joint were jammed when we drove by. We settled for a slice of pizza and a diet pop at our new local S’barros for our night out, and then we went to the Dollar General for material for our Thanksgiving centerpiece.
Everybody borrowed sales from the future to buy now.
0% down is all about getting people to buy NOW instead of 2009-10 when they could really afford the payments or pay cash
———————————————————–
but feel angry at all the people that went wild at HD back in 03/04/05
Everybody borrowed sales from the future to buy now ??
Exactly…And not just with residential, with commercial also…
When they stop being able to securitize and sell those “loans” the “no payments or interest for 3 billion years” deals are going to go away. That might be a very good indicator of when the credit markets have finally gotten rational.
mikefolkerth dot com
“I was just reading that President-elect Obama has determined that if more people had jobs, unemployment would be lower. This guy knows more about economics than I gave him credit for.
The job loses for last week were 516,000 and no you didn’t read that wrong. The predictions from nearly all sources are that job losses will continue well into next year after which time they will level off.
How do they know that unemployment will level off? At the rate we are going, only government employees will remain working and there won’t be anyone else to lay off. Most government jobs are considered to be in the asbestos sector; fire proof.
I’m holding to my long term prediction that we will see a New, New Deal unveiled in the not so distant future. But where will the money come from to support such a program?
This isn’t 1929, the physical system was raring to go in “29″ and now it simply isn’t. The resource cupboard is practically bare and the population is not nearly as prepared for hard times. Not to mention that this time around America is the largest DEBTOR nation on earth.
Alert reader Bill Arett, made the statement that many jobs merely represent indirect taxation due to their non-productive nature. The notorious Wall Street Gang, banking CEOs, top-heavy corporate management, massive government “make work” jobs, and the list is endless of those who take a lot and produce very little that is truly beneficial to society.
The producers of real goods and valuable services in America pay for the follies of our artificial hierarchy of needs and the false economy that has been built around the mantra of “growth is good.” If growth is good, then more growth is even better, seems to go the tune; up to now that is.
So how has America reached this point of no return, the time when growth is no longer possible? We elect the person that promises the most and demands the least from us. Here is an excellent example, author unknown:
The most eye-opening civics lesson I ever had was while teaching third grade. The presidential election was heating up and some of the children showed an interest. I decided we would have an election for a class president.
We would choose our nominees. They would make a campaign speech and the class would vote.
To simplify the process, candidates were nominated by other class members. We discussed what kinds of characteristics these students should have. We got many nominations and from those, Jamie and Olivia were picked to run for the top spot.
The class had done a great job in their selections. Both candidates were good kids. I thought Jamie might have an advantage because he got lots of parental support. I had never seen Olivia’s mother.
The day arrived when they were to make their speeches. Jamie went first. He had specific ideas about how to make our class a better place. He ended by promising to do his very best. Everyone applauded. He sat down and Olivia came to the podium.
Her speech was concise. She said, “If you will vote for me, I will give you ice cream.” She sat down. The class went wild. “Yes! Yes! We want ice cream.”
She surely would say more? She did not have to. A discussion followed. How did she plan to pay for the ice cream? She wasn’t sure. Would her parents buy it or would the class pay for it. She didn’t know. The class really didn’t care. All they were thinking about was ice cream. Jamie was forgotten. Olivia won by a land slide. End of example.
And that my friends is how we elect politicians in the United States and how we have arrived at the point of diminishing returns. It’s all about the ice cream.”
A microbrewery in British Columbia is toasting the current economic downturn by launching a special brand of recession-style beer.
Howe Sound Brewery has named its most bitter-tasting brew Bailout Bitter in honour of the government bailouts of the financial sector that have taken place in an attempt to mitigate the global financial crisis.
Calling it “bitter ale for bitter times,” the brewery said the new beer will cost less than its other brands.
————————-
looks like the bailout is flowing nicely.
Has the term “Bailout rage” made it into general circulation yet? It seems only a matter of time before folks start doing off-season bagging of AIG execs who’ve misspent taxpayer money on still more massage-spa junkets.
Peggy Joseph youtube
Growth for the sake of growth is the mentality of a cancer cell.
The only way they were able to grow this economic house of cards taller was by removing cards from the foundation. The foundation is falling yet Obama/Bush want to keep pulling cards from the bottom deck to prevent the upper levels from crashing down.
“Growth for the sake of growth is the mentality of a cancer cell.”
Testify, brothah! I about lost it when I heard some Florida pundit say that “growth” was the major industry in the state. How is “growth” an industry? It’s not an industry, it is a quality or a phenomenon or an action. It’s what a cancer or a fungus does.
That was a favorite line of Edward Abbey’s, about growth. And ain’t that the problem, at bottom? This crazy insistence in the biz world that not only must one’s profits grow each and every quarter, but that those profits must go up by an ever-increasing percentage every quarter? Yeah, that’s sustainable all right. To accomplish that, you get all the ills we’ve got.
Doggone it, Losty…surely you don’t expect us Real Americans to actually vote on all that elite jibber-jabber about policy issues, do you? The very idea that fruity, terrorist-loving liberals throw around words like “diplomacy” or “change” makes me cringe with fear. Who wouldn’t want to stock up on guns and pray with people like that running around?
As we say up in Alaska: Never trust anyone who doesn’t wear a flag lapel pin while field dressing a moose. (wink)
Praise Jebus and pass the ammunition…
Here in Utarr, we have a similar motto, but it’s while field dressing a Democrat.
(Though I did find it interesting that BYU had a sizable support for Obama among its students.)
I went to a dinner a few years back for the Utah Humanities Council at the Salt Lake Mayor’s house and someone joked that every Democrat in Utah was there. There were about 30 of us, and I suspect half of that number were Independents (myself included).
Wow,
You are certainly showing off your intelligence.
Eddie Murphy
” I got some ice cream , you aint got no ice cream “
sprinkles.
eddie murphy:
“yeeeww, we got MacDonodes, and you gotta green pepper welfare burger.”
LOL…….thanks for that flashback……:)
So did they get ice cream ?
Near empty reservoirs and now there’s another huge fire in Sylmar that’s awful thirsty…
One firefighter I know is making $900. per day right now with over time…
The travesty to me is not firefighter salaries, but that someone put firefighters’ lives at risk to protect mansions sited in obviously stupid places.
amen
I agree…You get a two for one…Let it burn…No need to pay over time….
If anyone thinks firefighters are overpaid, they can join up!
Has the risk premium come back into fashion, or is it merely still coming back?
THE INTELLIGENT INVESTOR
NOVEMBER 15, 2008
Joe Investor, the Markets Are All Yours Now
By JASON ZWEIG
For the past couple of decades, the markets have been dominated by institutional investors who devoured bargains so fast and in such bulk that individual investors were usually left, at best, with a few scraps.
But pension funds, hedge funds, mutual funds and other institutions are under siege as their portfolios implode and investors redeem their shares, forcing the fund managers to raise cash.
Virtually every investment that carries any risk is on sale. Stocks and bonds, at home and abroad, have had their prices slashed by up to 45% this year. Yet at the very moment when bargains abound, many of the giants who normally would buy can do nothing but sell.
Welcome to a buyer’s market without buyers.
Sounds like the housing market, no?
So what’s the spread between debt growth and the money supply? If the government can print money to bouy M3, then by nationalizing or bailing out the financial markets, aren’t we really socializing risk?
This article suggests that the only way to shore up against counterparty risk is to increase cash reserves, which is being done for the banks by the government as we speak. Ultimately, we’re unloading risk off of the financial system directly onto the taxpayers.
What’s to prevent foreign investors using their sovereign funds from coming in and buying up anything left of value? That’s why I think these bailouts are so dangerous…they will undermine our own sovereignty and national security.
NSO,
Absolutely agree with this…
That’s why I think these bailouts are so dangerous…they will undermine our own sovereignty and national security.
sure, there never was a better time to buy. Fannie, Freddie, GM, F, etc. all for pennies on the dollar (soon); get them as long as stock lasts!
for what its worth, the E U stock markets are still dominated by the big players, and that includes the daily buying against all odds (like blind following of S&P futures). I doubt it is much different in the US.
If you knew all these companies were going to survive the crisis, it would be a no-brainer for anyone with unleveraged liquidity to snap them up. The tricky thing is picking the likely survivors out of the mix of companies whose stock prices are down by over 95 pct from the peak.
Bear, can govenrment owned companies be listed?
whoops, dang keyboard - govner-mint-mint-mint
Updated version of JP Morgan’s timeless investing advice: “Buy when the only sellers are those who must sell. Sell when everyone else is willing and able to buy.”
‘This is a huge change for the little guys. Rob Arnott, who oversees $35 billion at Research Affiliates LLC in Newport Beach, Calif., puts it this way: “The question that hardly anyone ever thinks about is: Who’s on the other side of my trade, and why are they willing to be losers if I’m going to be a winner?” Ever since the 1970s, the person on the other side of your trade has almost always been someone who manages billions of dollars and has millions of dollars to spend on gathering more information than most individuals ever could. Now, however, as Mr. Arnott says, “You can — and probably do — have a counterparty on the other side of your trade who absolutely has to sell, perhaps at any price.”
You would be very wise to give these distressed sellers a little bit of your cash, which they overvalue, in exchange for some of the stocks and bonds that they are undervaluing. Sooner rather than later, institutions will no longer need to beg for cash, they will regain the upper hand over individuals, and the tables will turn again.’
As de-leveraging continues and gains speed, I expect them to be even MORE motivated/required to sell down the road a bit.
I’ll keep my powder dry, thanks…
“You can - and probably do - have a counterparty on the other side of your trade who absolutely has to sell, perhaps at any price.”
This is why cash is king.
Don’t buy when they are hot, buy when they’re not. And don’t do it yet; wait until things REALLY go to hell.
Wait a year or so.
Although I posted this late yesterday in response to B. Jones Friday desk clearing thread, I thought the article about CT taking the foreclosure lead last month is worth taking note…..
The Connecticut article where CT leads the nations foreclosure rate for October should be screaming out to everyone and anyone in the Northeast. It was just 18 months ago that CA had the lead and look what happened…. It spread like uncontrolled cracks north to Vancouver, west to HI and east into Nevada/AZ. In case you folks east of the Mississippi weren’t paying attention, the pacific coast is imploding as I write this. My sister in law is a Bend, Oregon resident and I talked to her last night. Businesses in Deschutes county are shutting down one after another, her husband got laid off last week and she said she’ll be canned in the next two weeks………… West coasties….. It’s over folks. Kaput.
If the cratering California and it’s tentacles is a model for what is to occur elsewhere, the northeast is in for an ugly ride.
We don’t think much about California. Just a place where all the wierdos went. And the strawberries suck. Nah, it’s a different world.
It’d be hard to find a place more devastated by overbuilding than Bend, OR.
Hey BB.. is Oregon your locale?
No, WA state. I go through OR several times a year, though.
I had a dream last night…
I had gone out to get a nice gift for my wife for our 20th. I went in to a pawn shop that seemed very familiar. It was laid out like a cafeteria with a long line of cases with bins of stuff to choose from.
The guy in front of me in line was someone I know well, and his tray filled with some very nice looking watches and rings, and he paid and left.
I noticed that as that fellow was shopping there was a worker coming along replacing the bins of goods with bins of Chinese food. I complained that they were taking away my chance to buy a pretty for the wifey. I was told succinctly that changeover time was 4pm, no exceptions.
I really pitched a fit, and looked to the crowd behind me for support, but I quickly realized they were there for the food and just wanted me out of the way.
Second post later for second half…
Dude, you gotta quit reading the financial news while eating Chinese takeout!! LOL!!
Lost in U, I responded to your inquiry last night but it didn’t go through. Thanks for asking, squatting goes great. I really hope to find a way to stick it to the bank by prolonging the process, if Mrs. dude will let me.
‘…if Mrs. dude will let me (stick it to the bank).’
Is Mrs. Dude unfortunately laden down with a need to respect even the stupider sorts of rules? Sigh. Some of the best people are, and it’s a pity.
Slap it out of her! But lightly, man, lightly. And then give her a nice anniversary present. But not some Chinese food.
She is just worried that when we get the 60 day notice required by law here in CA it won’t be enough time.
She is a very reluctant renter, as was I at the beginning. Hopefully as the months go by with all that cash building in the bank she will learn to like squatting far more than she has liked renting. Already she recognizes that we don’t need to worry anymore about getting our security deposit back, so there’s a plus right there.
I was taught to not hit girls as a child and it stuck, just like the “wilst” thing. I use gentle persuasion, and it helps a ton that she loves me, she really loves me! (credit Ms. Field)
Maybe it’s the Hole in the Rockers dancing skills you inherited…
Second half…
I left the pawn shop/restaurant and after getting to my car I realized my wallet wasn’t in my pocket. I thought I must have left it ont he counter back in the place, so I retraced my steps.
As I went back to the place I came upon several wads of cash that had been discarded, I picked them up one by one and recognized they were from my wallet, by the time I got back I had a huge chuck of cash but I was much more worried about my credit cards, drivers license, etc. in the wallet.
I found the wallet just outside the restaurant empty of all contents. Whoever had stolen it had no use for the cash, but wanted my documents and credit.
Weird huh?
Later on I dreamed about getting the family to higher ground while 150ft, waves crashes ashore. If I, who have made good decisions thus far during this crisis, am having unsettling dreams. What is J6P dreaming about?
Dude, interesting dream. I was in town yesterday, walking around, and I was checking out the faces of everyone I’d meet, you know, did they look happy, sad, whatever. Everyone looked happy or else lost in thought, but no one looked particularly troubled. I then had a very unsettling feeling, like I was a ghost from the future coming back and I knew abut all these things that were going to happen and they had nary a clue.
I had to duck into Woody’s and order a Squatter’s Beer, even though I don’t drink.
I think most J6P’s out here are still sleeping OK, but a few are starting to have those bad dreams…
Glad the squatting’s going good, hang in there and save the cash for Combotechie.
Zombies to the left of me,
Zombies to the right of me,
Into the valley of debt…
Dude,
I haven’t had a dream like that since my Ex ran off with the gay antique dealer. Scary stuff!
‘I haven’t had a dream like that since my Ex ran off with the gay antique dealer. Scary stuff!’
LMAO (…sorry if it really happened)
In regards to the dream, I can certainly appreciate some of the symbolism, but there is another thing that I find paramount in import.
I’m a objective guy, an engineer, but I acknowledge that I rationalize many decisions in my life to fit my world view, sometimes knowing full well at the same time I’m doing it.
Does my subconscious mind, the executive producer of my dreams, rationalize? I think not.
Are not our dreams often the truest gauge of how we view the world around us?
dude,
You got me on that. I am an engineer too. All I can say is the wave thing has impact. Mine included the boat sinking and luggage floating past. Scrambling up the bank as the step s washed away behind me. Pretty simple symbolism! Even an engineer can get it.
I think your brain has some things figured out that your waking emotions won’t let you acknowledge.
Skye
dude,
I dream by day about much ado about something or another, not too dissimilar from your nocturnal e-missions…
my dreams are of the Sea of Tranquility…
Nov. 15 (Bloomberg) — Britain’s opposition Conservative Party said Prime Minister Gordon Brown is running the risk of a “collapse” of the pound by allowing the U.K. government deficit to swell.
…
The pound has already shed more than a quarter of its value in four months, declining to less than $1.50 this week from more than $2 in July.
The pound is down to 12 ounces.
14.583 ounces for those of the avourdupois persuasion…
troy ounces (T/O)
Browns government also predicts inflation (currently over 5%) will decline to below 1% within a year or so. Good luck with that when the Pound keeps dropping like this … or maybe they need to hire some statisticians from the Dutch Ministry of Truth to help them get to the desired below-1% CPI.
http://www.smartmoney.com/Investing/Stocks/How-to-Tell-When-the-Bear-Market-Is-Over/
Since we had a thread yesterday about the consistently and dangerously wrong I thought I’d post Don Luskin’s latest nonsense.
From the link:
But the risk of a global meltdown of the financial system is now off the table for sure.
——————–
Mark that one down on your calendar!
Nov. 14 (Bloomberg) — Ecuador said it may default on a $30 million interest payment as a tumble in oil erodes export receipts, putting President Rafael Correa on the verge of fulfilling a two-year-old threat to repudiate the country’s debt.
Cash remains king.
The commodities bubble implosion is taking down the entire globe. Scan Bloomberg Regions under news. They were fools allowing it to get out of control. It’s all contained now. Everything is falling but debt.
Commodities bubble + counterparty failure in LOC’s = Baltic Dry Index down 93% = Smoot-Hawley turbo-charged on steroids.
I love math early in the morning.
“Cash remains king.”
In the European union it is now a prince.
In Great Britain it is now a duke.
In Argentina it is Lady in Waiting.
In Brazil it is a mere mistress.
In Iceland it is a court jester.
And in Ecuador it looks like it’s about to be an orphan.
Lol.
Ecuador is one of the few countries in the world that abandonded it’s currency (Sucre) in favor of the Yankee Dollar, about 10 years ago..
Whoops~
More money rapture, which makes any surviving money all the more scarce thus more valuable, no?
King,
The money rapture is kind of like the religious rapture, in that both of them make explicit guarantees about being saved.
But with money the guarantee is valid. Ask any of those who desperately need some.
Yep…..
Wikipedia: a religion is a set of tenets and practices, often centered upon specific supernatural and moral claims about reality, the cosmos, and human nature, and often codified as prayer, ritual, or religious law. Religion also encompasses ancestral or cultural traditions, writings, history, and mythology, as well as personal faith and religious experience.
Come to gold, brother. Just follow the light.
A prayer is little different than a homeless person walking down Santa Monica Blvd, talking to nobody in particular.
Just another smart guy in another room…
In a money rapture, its the money that gets to vanish and we get stuck here in debt hell holding the bag.
It isn’t as though Ecuador cannot afford to pay. They’ve got plenty of money.
Correa is attempting a “walk away”.
yeah, its not like they just cant auction off the Galapagos Islands to guys like Buffett for tidy sum to pay the debts….
maybe Sorros is negotiating a Collateralized Galapogos Obligation?
You don’t get it.. this Correa guy has tried it before..
Correa’s government has used this tack before, saying in February 2007 that it would wait till the 30-day grace period to make an interest payment. Correa then reversed course, opting to make the $135 million payment on time.
[snip]
Correa, who earned his Ph.D. at the University of Illinois at Urbana-Champaign, won a landslide victory in November 2006 after promising to rewrite the constitution and boost spending on the poor. He said in September that he’d suspend debt payments before trimming spending on education and health care.
The willingness to pay is obviously not there,” said Alberto Bernal, an emerging-markets strategist for Bulltick Capital Markets in Miami.
[snip]
While the drop in oil has crimped revenue, the government still has enough money to service its debt, Bernal said. Viteri said at the news conference that the government has the cash to make the $30 million payment on time.
Maybe he’ll buy an American bank and tap into the $700 billion.
I dont get it?
I dont negotiate with economic tourists, especially in Korea.
If Ecuador wants to kick off the walk away from sovereign debt obligations road show, they can start mining gold to pay for imports, or beg the IMF for a handout. maybe they should become Princess Cruise Lines of Ecuador and apply to be a bank holding company.
time to get my pirate hat and longsword out.
aarrrg.
Correa, who earned his Ph.D. at the University of Illinois at Urbana-Champaign
that explains everything, US educated…
To be solvent, the face value of the government’s net financial obligations has to be no larger than the present discounted value of current and future primary government surpluses (government surpluses excluding net interest and other investment income)….
—
cmon joey, lay it on me, or go out and get yourself some Silicon Valley TARP moneys for a high speed rail project.
In the US too, the markets will have to learn to do without a US dollar financial instrument that is free of default risk.
“If Ecuador wants to kick off the walk away from sovereign debt obligations road show, they can start mining gold to pay for imports, or beg the IMF for a handout.”
Nah. They’ll just join ALBA and Chavez will buy their bonds. Worked for Honduras.
This cult is, for the third, running into debt. Capitalism is probably the first case of a non-expiative but indebtive cult. In here this religious system is standing in the collapse of an immense movement.
An immense sense of guilt, which has no notion how to deexpiate, grasps for cult, not to expiate in it, but to let it become universal, to hammer it into consciousness and finally and above all to include God himself into this debt to at last have him being interested in the expiation of the debt.
Walter Benjamin, Ges. Schriften, VI, S. 100, Frankfurt/M., 1991)
—-
you see Joey, whether the rest of the world, including Ecuador, wants to admit to capitalism a system of Sovereign debt has been in place for quite some time. By not experiencing guilt over the rupiduiation of debt (as seen in the walkaways in the US and now UK housing markets)..there is no “risk free” model with which the Quants can create blowback on leveraged casino gambling.
the system is on the brink of failure. Im not an idiot, I just play one on this blog.
translation.
“the world does not want to admit that Capitalism is a system of Sovereign debt becasue debt sucks. And God hates liars.”
latest news [AIG] AIG to pay out $500 mln in earned deferred pay in Q1
Experts set low threshold of ‘do no harm’ for G20
By Greg Robb, MarketWatch
Last update: 6:55 p.m. EST Nov. 13, 2008
WASHINGTON (MarketWatch) — Do no harm. That is bottom-line request from economists and policy experts to the global leaders who will gather in Washington this weekend to discuss the economic crisis.
…
“Having some broad restructuring at this point would kind of be like in the middle of a five-alarm fire calling together the fire chiefs and trying to restructure the fire department,” said Steven Schrage, a former economic advisor in the Bush administration and now an analyst at the Center for Strategic and International Studies.
“And you could also do more harm than good,” he said.
The list of missteps that could send markets into tailspins is almost endless. Finger-pointing, disunity or a sense that the gravity of the situation has not sunk in could lead markets to crater, experts warned.
“If there is … disunion between the parties at this event, I think that markets will react very, very badly to that,” said Charles Freedman, an expert on China at the CSIS.
But the meeting is important if the leaders could agree not to take any independent “beggar-thy-neighbor actions” that could lead to further economic woes.
This will not be easy, although so far international cooperation has been excellent, experts said.
Beggar-thy-neighbor policies can be play well with domestic electorates.
There are apparently two kinds of U.S. companies: Those which qualify for bailout monies, and those which do not. And companies from an amazing range of industries are trying to follow the surviving big Wall Street investment banks’ lead to recharacterize themselves as belonging to the first category.
latest news [$SPX] S&P 500 socked with 6.2% weekly drop
Insurers in last-minute bid for Treasury money
Hartford buying small savings and loan to qualify for government bailout
By Alistair Barr, MarketWatch
Last update: 6:48 p.m. EST Nov. 14, 2008
SAN FRANCISCO (MarketWatch) — Several insurers, including Hartford Financial Services Group and Genworth Financial Inc., made last-minute bids for billions of dollars in government money Friday.
Hartford Financial said that it agreed to buy a small savings and loan, helping the giant insurer apply for a government investment of up to $3.4 billion.
Shares of Hartford jumped 21% to close at $12.65 after the announcement.
The company said it applied to the Office of Thrift Supervision to become a savings and loan holding company and has applied to participate in the Treasury Department’s Capital Purchase Program, or CPP.
“The company said it applied to the Office of Thrift Supervision ”
does this mean that they are now obliged to have regular hunting parties in England for the management?
The trouble with a nebulously-defined emergency bailout is that the money can easily be diverted from its originally intended purpose.
WSJ
NOVEMBER 15, 2008
Showdown Looms Over Auto Bailout
By GREG HITT and JOHN D. MCKINNON
WASHINGTON — Congress and the Bush White House appear headed for a showdown next week over how best to assist Detroit’s troubled auto makers.
Senate Majority Leader Harry Reid plans on Monday to move forward with a bill that would give the auto industry access to the $700 billion Troubled Asset Relief Program set up by the government in October to help ailing banks and other financial firms.
Rochester-area home prices up 2.6% in October over last year
http://www.democratandchronicle.com/article/20081115/BUSINESS/811150340/1001
The median selling price in the 12-county area covered by the Greater Rochester Association ofRealtors increased 2.6 percent in October from a year earlier, to $117,500, the association said Friday. The median means half the homes sold for more and half for less.
Despite the good news on values, many would-be buyers in the Rochester area are sitting on the sidelines because of the weak U.S. economy, which has caused consumers to pull back on all kinds of spending. As a result, real estate agents closed only 954 sales in October, down almost 16 percent compared with October 2007.
This area has to be one of the few where sales are declining and prices rising. I guess if you don’t buy when inventory is increasing, you’ll be priced out for ever, or something like that. Never discount upstate NY from doing things that don’t make much sense. After all, it is different here….
Just read that the city of San Jose will request $14 BILLION from the bailout to pay, among other things, retired police and firefighter salaries. When will the California public recognize $150,000/year for a beat cop or a firefighter is just too much; instead, they consistently vote to give them ever more money. And, the idiots on the Hill still don’t recognize how much of a moral hazard they’ve now created: automakers, student loans, banks, “struggling homeowners”, counties, cities, et al. Whose next? The pet grooming industry, or maybe a direct bailout of the National Association of Realtors?
The demand for free monies is inherently unlimited, while supply is ultimately constrained, no matter how prolific the printing press which creates them.
And, if I read tomorrow, or the day after, about how the City of San Francisco is following San Jose’s lead… I’m personally going down to City Hall and protesting.
SF city staff consists of around 25,000, with around 1/3, or 8,180 of them making more than $100,000 annually.
That’s one city worker making $100K for every 99 residents.
http://www.sfgate.com/webdb/citypay/
“Public servants”?
Serving who?
Serving what?
I wouldn’t mind so much if the City was well run!
But since City workers appear to be incredibly inept for their level of pay, this has all the looks of a high-end welfare scheme.
What is going on in SF is CRIMINAL.
“Cities pay huge salaries despite fiscal crises”
Erin McCormick, Christopher Heredia,Carolyn Jones, San Francisco Chronicle Staff Writers
Sunday, March 30, 2008
“A city nurse earned $350,000. A fire department battalion chief
pulled in more than twice as much as the mayor. And a municipal park ranger took home $188,000 in overtime on top of his $71,000 salary.”
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2008/03/30/MN7OVQOPK.DTL
Rare is the politician that will take on the firefighters, police, and other government employee unions, and their lapdogs, the local news media. They have it down to a science.
-Politician proposes budget cuts and/or workforce reductions.
-The unions run to their buddies in the local media, predicting martial law and the Great Chicago Fire, if the reductions take place
-Various crybabys whine to City Hall, wanting to know why they are “putting people in danger”
-Politicians run for cover….
“The demand for free monies is inherently unlimited, while supply is ultimately constrained, no matter how prolific the printing press which creates them.”
I recently drove by an absolutely monstrous job site, seemingly thousands of acres, which had been cleared of all trees and vegetation. I couldn’t fathom what might possibly require so much land, until I saw the sign which read “Bureau of Engraving and Prining.” /sarcasm
“Bureau of Engraving and
PriningPrinting“I wonder whos buying all of CA bonds tax free or not they can’t be safe ?
How dare Wall Street put out this big supply of money ,that ended up
going to building houses for speculators Ponzi-schemes and debt purchases for products .When the Market Makers were questioned ,they come up with every excuse in the book as to why
recent de-regulation of long-standing law was good and must not be
brought back .
America discovered a long time ago that Capitalism has some evils and
had to have some regulations. Greenspan failed to respond to the excess money supply by raising the rates . Wall Street relied on the past good
record of the secondary market of real estate investment and slipped in a
new set of rules and models of risk . The Hedge Fund guys and Wall Street Investment Banks and Lenders act like they served some noble purpose in flooding the Country with a over supply of cheap bogus priced high risk money . Venture capital is one thing , but at least its rated the high risk that it is .
Oh ,Wall Street acts like they just made a little mistake of miss-pricing risk on the investment products they offered the World . The Market Makers of Wall Street created a product that increased the risk because it was a defective product because investment Tranches were set up to be in conflict of interest with each other ,for starters .
It just had to be that the Lobbyist got their way and these are the
forces that got in power and got to the Politicians . So what to do about the problem of Lobbyist having the power to make Politicians forget their oath to protect the general welfare of the majority of Citizens?
Witness the Congressional Hearings in which they repeatedly call in the Fat Cats and Power Brokers and ask them their opinion . Wouldn’t it be better if they just let their Defense Attorneys show up and spin
Defenses . How about some objective investigations in which neutral Experts conclude what went wrong and what happened ? It was interesting entertainment watching a bunch of Gordon Gekko’s on the stand ,but the creditability of that testimony and any recommendations of that group is suspect . Good lord these Kangaroo Courts are just getting to me as well as Hank Paulson being presented as being a objective Civil Servant .
telluride news dot com
“One of the area’s largest granters, the Telluride Mountain Village Owner’s Association, handed out just more than half the money it made available to events and organizations last year.
“These are tough economic times. And we’re trying to do the best we can.”
“Last year we were pretty flush,” said TMVOA Board President Mike Wisniewski. “This year, we kind of got hit in the side of the head with a 2×4.”
That 2×4 strike came in the form of real estate transfer taxes — or a lack thereof. The RETA — the real estate transfer assessment — is anticipated to come in $3 million below 2008 projections and TMVOA’s 2009 budget projects $4.5 million of the tax, a number the group thinks is conservative. Some years have seen $10 million in RETA revenues.
“When you’re really cutting to the bone, you’ve got to do everything you can to do things that support your prime constituency,” he said. “These are hard times. It hurts to be the deliver of bad news.”
Money for economic development grants — essentially event funding — fell from $670,000 to $550,000. The money available for “charitable” contributions fell from $300,000 to $100,000.
“We are skidding into what looks like the worst economic times since the Depression. Could happen,” he said. “This community is a bit insulated, but we’re part of the world, too.””
telluride clearly needs Hank to flop down some TARP cash to save the ski-bums.
maybe telluride could become a bank holding company.
Those super rich areas will get hammered for the same reason every other area has gotten hit….The “WannaBee’s”….
Telluride was the site of Butch Cassidy’s first bank robbery - $24k.
Years later, during the GD, the bank failed. The town went from a population of 5000 to 500. Telluride was a classic silver/gold mine boom and bust story until the ski area came in. But it didn’t escape the GD and won’t escape now, either.
I guess I get some schadenfruede from that, my aunt and uncle owned a ranch there and my cousin’s first pony is buried under what’s now a rich weasel’s tennis court.
(not that I mind rich weasels, you know, it’s the tennis thing I object to)
Dear Gawd, the pore pony.
Never fear, silverback, it was dead before they buried it.
I think its pores were pretty nonfunctional by then.
Listened to Weekend Edition on NPR this morning. Toward the end they did an incredible segment about the song, “Brother, Can You Spare a Dime.” I had no idea there was an explicit reference in the lyrics to the singer being a WWI veteran. The analysis of the music was also great.
Here is a link to the whole show:
http://www.npr.org/templates/rundowns/rundown.php?prgId=7
And here is one to just the segment:
http://www.npr.org/templates/story/story.php?storyId=96654742
The text is a brief description. The link to the segment (a little over 10 minutes) is near the top. Highly recommended.
What’s the next step after the bailout phase? The soaring interest on the federal debt phase?
People assume it can’t happen. But while saving for an, ahem, house in the early 1990s, we got a two-year Treasury note paying 9.5%. Needless to say mortgage rates were higher than that, and had been for years.
I saw last week that the government was recalling bonds yielding 12%. Egads! Not sure if these were 30 year bonds.
I’m waitin’ for some of those, or 9.5 % at that. I remember those. Didn’t have the cash to buy them at the time, though.
some of the first statistics for october sales in california are coming out, and october is looking to be HORRIBLE for home prices. Check out,
http://www.rereport.com/index.html
“untouchable” City of San Francisco is down 14% YOY
Alameda County (Oakland) is down 37% YOY
Santa Clara County (Silicon Valley) also down 37% YOY
The NY Times reports condo price protection guarantees are being given to people who have never heard of counter-party risk.
http://www.nytimes.com/2008/11/16/realestate/16deal1.html?_r=1&ref=realestate&oref=slogin
“Sign now, say Mr. Berger and other developers across the city, and if the economy forces future price cuts, at the closing you will be guaranteed the lowest price available to other buyers. The promise is being written into individual sales contracts, and some developers, like Steelwork Lofts, are filing amendments to their offering plans so that they can extend it to all buyers and include it in their advertising.”
If you are going bankrupt anyway, why not guarantee everything!
O.k., I’m off to buy a Mac at Int’l plaza. Gotta keep the widget economy movin’ along.
Pick up two, and when you get home I’ll come take the extra one off your hands
Watch that keyboard on the Mac Pro, hard to handle…makes all kinds of inana I mean inane and irretrievable mistakes…
Muggy,
Watch out for Apple haters
And if someone suggests a gay marriage, just say no!
Mike
Weird tech day. I spent the last 3 hours simultaneously setting up my new macbook (got middle of the line, the imac is tempting, but I prefer being mobile) and disinfecting my dell which got the annoying Antivirus Pro malware.
I’m also researching online trade accounts. What’s the easiest to use?
“I’m also researching online trade accounts. What’s the easiest to use?”
In my experience they are all pretty much the same.
Enjoy that new Mac.
Mike
very nasty malware, that. I have a never-ending flow of friends & family bringing me their sick computers (I never fail and never charge :-D), usually riddled with malware, and Antivirus Pro is the worst to date that I’ve seen.
I can fix most malware issues in my sleep, and it’s a rare decision for me to do a last resort thing like restore cd’s. But a recent laptops XP install was rendered unusable by that program.
It’s amazing Microsoft isn’t doing more to control the spyware epidemic. The majority of the time, some online ad or pop-up fools a web surfer into agreeing to install that stuff. Those ads where its a pic of Britney Spears with a come-on like “Click the correct name and win a free X-Box”, they’re targetting kids/novices and are easy to spot. But lately savvy users are taking the bait more and more often, because the come-ons look almost identical to Windows Update and Security Center messages.
Not long ago, those things would be much easier to spot as fraudulent: for instance they often had the word “Advertisement” silk-screened on them somewhere. Now their look and feel is identical to legitimate XP messages. I can’t imagine it being very hard for Microsoft to sic a team of lawyers on the people responsible, or even to tighten up those “Malicious Software Tools” that are part of their automatic updates. It’s as if they’re laying down their weapons on this one.
It sucks because one piece of malware usually spawns a dozen more, which inevitably leads to x-rated material popping up on the family computer, and lots of suspicions as to how it got there. I’ve gotten spyware via an IE vulnerability employed by a song lyrics website I’d used many times before (now I stick to LyricsFreak). It can happen to anyone at anytime these days.
—FYI— Malwarebytes’ “Anti-Malware” program is effective at removing AntiVirus Pro. It’s free and available at www dot download dot com.
We were talking about Telluride (OK, I was talking about Telluride) above, and I want to add this story:
Charles Waggoner was president of the Bank of Telluride on the eve of the GD. With the crash of 1929, Waggoner devised an elaborate scheme to keep the local bank solvent.
He had a never-revealed accomplice send fraudulent wire credits from Denver banks to banks in New York. There, Waggoner withdrew the credits (about $500,000) and used the ill-gotten cash to pay off his bank’s true creditors, the people of Telluride.
Waggoner was quickly charged with fraud and testified in court, “I would rather see the New York banks lose money than the people of Telluride, most of whom have worked all their lives for the savings that were deposited in my bank.”
He was sentenced to 15 years.
Wow. Truly taking “one for the team” as it were.
A mere 500k and 15 years to be a local hero forever…
But I wouldn’t wanna do it.
Back then, it was real money = $50M now (roughly.)
But yeah, not me either.
The guy had principles, of a sort. A far cry from today’s banksters.
Does anybody get concerned when the Leaders of the Nations get together
for a Summit to discuss what Unified moves they have to make regarding
the meltdown of the financial markets ?
My real point is that now you are seeing some of the results of unregulated Globalism regarding money supply . Americans having no jobs and manufacturing leaving for foreign shores is another example of some of the possible problems with opening up a Global labor force . Who benefited from this monopoly of cheap labor and products ? Certainly the American worker
doesn’t benefit from it in that they have no ability to compete with slave labor ,or even wages that have no bearing on what the cost of living is in America .
Is anybody getting the hint that Big Business and Corporations were the ones that benefited by this turn to unregulated Globalism ? Who is running the ship these days ? Must be the Lobbyist that are running
America today (compelling evidence is that the Politicians are making decisions with no regard to Main Street ,or even sanity ).
People like Gerald Celante (www dot trendsresearch dot com) contend that this was a planned engineered event.
“There’s the media world, the political world, and the real world.”
I think he reads here. Hey Gerald, don’t be so bleak!! Tax revolts, gas riots, people living in storage units…
He’s right. It was.
From Naked Capitalism, long article:
“Credit Crisis Fallout: Investors Leery of Buying Government Debt As Calendar Grows”
“For any government looking to raise money in the capital markets in the next few months, there was an ominous development in Germany this week.
A German 10-year bond auction failed – something more or less unheard of until this year – as cash-strapped banks and investors snubbed the government offering.
It is a clear sign of straitened times when a benchmark bond in one of the most liquid markets in the world cannot attract enough bids to reach its target amount.
High wage American workers are also consumers, and consumers certainly do benefit from “cheap labor and products”.
This housing bubble force fed and over-expanded businesses/labor of all kinds. Now comes the contraction.
This contraction can’t be blamed on globalism. Had the USA been thoroughly isolated and protectionist and experienced a similar ‘bubble’, results would be the same.
I do not agree with you JoeyinCalif. The USA would not of had
anything close to what happen if they had been more protective
and didn’t let go of key regulations and trade and labor balances .
We would of gone in a recession at the turn of the century ,but
it would of not been the big deal that this bubble turned out to be.
Your just acting like this mess would of happened without looking
at historical events that made it happen and contributed to it happening .
Knowing what would have happened if history were changed requires the same skills as does predicting the future.
“High wage” is relative to where one lives.
When consumers can longer buy at any price, then what?
Remember, our economy is 74% consumer driven.
I said “high” in comparison to foreign slave labor markets.. Americans do get pretty high wages on the global scale. American labor is in serious competition with foreign workers. Will labor willingly become competitive pricewise? For some reason, no. I guess we feel entitled.
Competition forces business to seek out the lowest production costs. Labor is the biggest cost. If somewhere on Earth, labor is cheaper and is accessible, thats where business goes. If labor in the town 20 miles away is cheaper, business will avoid hiring people from my town. Likewise competition from a border state, a border country or overseas.
Business has no choice in the matter. Globalism is not a choice. Globalism is the result of evolving and improved long distance communication, transportation, etc. If someday Martian workers will accept lower wages and if it’s cost effective to hire them, build factories on and import goods from Mars, we will experience Solar Systemism.
Easy solution…. impose tarriffs, problem solved.
“Does anybody get concerned when the Leaders of the Nations get together for a Summit to discuss what Unified moves they have to make regarding the meltdown of the financial markets ?”
I’m just as concerned about the lavish arrangements. While these pigs steer the masses towards poverty, they’re dining on “fruitwood-smoked quail, thyme-roasted rack of lamb and baked Vermont brie with walnut crostini, along with three wines.”
They should be eating Top f***ing Ramen.
Correction: They should be eating Top f***ing Ramen in a jail cell, at best.
Honestly, they should be hanging from a rope and I’ll be happy to lead the charge. These lying monsters are the perpetrators who advanced the lie that “lowering taxes is good for the economy”, off shoring is good for the economy, “competition” with dictatorships that enslave their people is “good for the economy”, etc.
I keep a long list of these money grubbing, lying bazillionares that I add to on occasion. I look forward to executing these punks.
I’m sure they’re quaking in their boots. What color crayon you using?
I’ve been waiting to read something profound from you, the authority on intellect, but you’ve done nothing but fail miserably.
Ignore him BB. Everyone does except for Ben.
Whoa, who knew I’d catch 2 retards with 1 cast? Gonna have to switch to a stronger line - good thing they don’t have much fight.
You are tits on a bull, amoney: udderly useless! Keep posting though: this site will provide all the humility you are currently starving for, might even make a man of you.
Depending on how long this unravels it just may happen…I hear alot of increasingly more violent talk of beheading, castrating,and hanging of these crooks…You know it’s coming. The sad part is the crazies always kill the poor receptionist ,or innocent line worker, never the corporate heads. Sheesh we can’t get anything done right anymore.
Governments Take Huge Bite out of WSOP Final Table Pool
The tax monsters… feasted heavily on the World Series of Poker main event’s final table participants. Out of the $32,731,585 collected prize pool that was distributed to the final nine players, about $14,793,416 went to governments from around the world.
[snip]
By far, the person losing the most through taxes is the winner of the main event, Peter Eastgate. Denmark puts a severe tax burden on those who win big at casinos. For casino wins, Danes owe their government 45 percent on the first 4 million Danish Kroners won and that figure jumps to around 75 percent on anything above that. A $1 is worth about 5.8 Kroners, meaning Eastgate’s $9.1 million first-place prize falls easily into the higher rate.
Assuming Eastgate is subject to Danish taxation laws, he is looking at a tax bill of around $6.6 million.
If Denmark winds up with Eastgate’s tax dollars, Eastgate will get to keep only $2,491,871 of the $9.1 million paid to first.
Second-place WSOP finisher Ivan Demidov won $5.8 million, and according to Fox (and thanks to a Russian flat tax rate of 13 percent), he gets off fairly cheap with a $755,247 tax bill.
So, the 2nd place Russian takes home $5 Mill while 1st place Dane gets around half of that.
http://www.cardplayer.com/poker-news/article/5527/governments-take-huge-bite-out-of-wsop-final-table-pool
in related news, the G20 WSOBailouts…
discusions have included:
1. Poker tables need to be tilted towards more sustainable looting.
2. A lottery for bond failures is also being considered.
3. The PTB also mention a Keno currency collapse game.
4. The idea of a hard global currency has been tabled until Sarkozy can cash out and move to his Ecuadorian retreat.
5. Winking, nudging, signaling and other assorted measures of coded gamesmanship have been approved by the Chinese.
As the meeting got under way, the International Monetary Fund agreed to a loan worth at least $7.6 billion as part of a bigger plan for Pakistan where foreign currency reserves have dwindled and the risk of a default on its debts has grown.
—-
thats an actual quote coming out of the meeting, when you run out of money and you are about to default, you best get a loan to pay your debts.
How can I pay my property taxes if I cant HELOC my house?
perfect logic.
The summit communique agreed on Saturday said “regulators must ensure that their actions support market discipline, avoid potentially adverse impacts on other countries, including regulatory arbitrage…,” the text said.
“We pledge to (…) ensure that all financial markets, products and participants are regulated or subject to oversight, as appropriate to their circumstances” he said.
——-
regulatory arbitrage, and oversight appropriate to the circumstance.
translation: “I will not allow a private party or Sovereign to game my useless eaters money, and I make up the rules as I see fit.”
Eu bubble watch:
funny newsitem on Dutch TV today: the Polish are coming! Although the Polish are best known in my country as low-wage workers (mostly because they don’t pay taxes …), the situation is changing rapidly. In German towns near the Polish border, not too long ago the Polish were notorious for shoplifting activities. But nowadays, they are welcomed in style (often in their own language) as they are propping up the sagging German economy. Polish incomes have increased strongly over the last years (thanks to unlimited amounts of EU money …) and their currency has strongly appreciated vs. the euro (reality is that the euro has plunged lately, so they were lucky that their country did not join the euro).
Ten years ago customers from Germany would go bargain hunting in Poland, now Polish consumers go on a spending spree in Germany as most luxury items are cheaper there than in Poland. The Polish consumers are known now for their appetite for expensive brandname items.
When do we start reading about the Mexicans who are propping up US retail sales?
Anybody else bothered by Grant Wood’s “American Gothic” being prostituted as a housing bubble merchandise ad at top of site? I have somewhat dirty hands cuz I clicked on it to give Ben’s dial a small spin.
Has anyone not prostituted that picture? Search Google/Images for “American Gothic” and there appears page after page.. (around 1,260,000 hits)
Grant Wood was an unknown artist from Cedar Rapids, Iowa in 1930. He went down to a small town in south-central Iowa called Eldon. He traveled there because a friend of his was running a community fine-arts project. He was riding around in a car with another artist named John Sharp. While riding, they encountered this house on the outskirts of Eldon – an extremely modest clapboard house, but it had this gothic window, which stood out. It was not completely unexceptional in the Midwest, but it was strange enough to get Wood to get out of the car.
He decided to put some figures in the foreground that could possibly belong to this strange house. He had his sister and his dentist pose for it. He distorted them – he elongated them with grim expressions. Then he entered it into a contest at the Art Institute of Chicago, where it received third prize. A notable critic reprinted it in newspapers, and from there, it took off.
Originally, it took off because it was ridiculing the Midwest and the kinds of people who supposedly lived there – uptight, repressed, puritanical and generally nasty. The sort of yokels that writers like H.L. Mencken would poke fun at throughout the 1920s. It also stirred up a controversy in Iowa because the farmers really thought it was an insult to them. Its initial fame was born out of controversy, out of the perception that its meaning was satirical.
http://www.popentertainment.com/gothic.htm
I’m starting to think about, cough, cough, bailing from the oc, cough, cough.
Anyone have any insight on Morgantown, WV? The Ex was just evac’d from Yorba Linda and brought my son over and mentioned Morgantown as a possible escape target. Works for me as my family is in Pittsburgh.
So I am interested in what other HBBer’s have to say about the place.
Thank you in advance.
I’ve been to Morgantown.
What little I saw seemed like a regular college town. Since more so than most places, I suppose, I can say the natives do not treat visiting football teams very kindly - the language and flying beer bottles come to mind.
One year our team had the last laugh by winning on a late field goal.
It was sweet…
sf jack, glad you didn’t get hit with any flying bottles.
polly said something brilliant in yesterday’s bits bucket (which I only just got time to read):
“even if all the forclosed people were instantly turned into renters in the homes that were forclosed at the lowest PITI they had under their original loan terms”
I hadn’t thought about the mortgage re-writes in these terms, but that’s really exactly what they’re doing. Save the poor FBs from having to move, lower their payment to 38%, but the Fannie/Freddie rewrite guidelines didn’t reduce principal—-they merely pushed it out to a large balloon payment. In other words, renters who will either stay there FOREVER, or renters who will become walk-aways when the eventually realize that they want to sell and can’t.
That may actually be a good way to do re-writes. Saves the poor FBs from moving now, and changes nothing except for the mortgage-holder’s cashflow from big-loss-now to some-payment-now-and-big-loss-later.
“…big-loss-now to some-payment-now-and-big-loss-later.”
The Sheila Blair FDIC plan means the Fed (us) will absorb 50% of the “big-loss-later”.
Thank you, though I think “brilliant” is pushing it a bit. But I would be delighted with “somewhat insightful.”
Anyone want to buy a condo in Poland?
http://chicago.craigslist.org/chc/reo/920406116.html
Jeepers… and here I thought $300K per bedroom in Chicago was ridiculous!
Hey Alad, if you’re right, we’ll all be eating crow…
Maybe some squirrel…
and armadillo too.
Shift Happens
Tomorrow can we have a fruitful discussion about the future?
I posted the above crow/squirrel/armadillo joke after getting off the phone with my sister; her husband is most likely going to lose his job and his brother just got laid off. I also have a friend who is going to declare BK soon.
I need to make some hay while the sun doesn’t shine. I want to short some retailers before the great Christmas shit of 2008. I just resigned a very secure position for a riskier position that will allow me to work from home, saving money while raising my son. I avoided buying a house in Florida and now I am ready to put my money where my mouse is and place some bets.
I say fruitful because I really want to hear everyone’s plan… as in the specifics of what they think will happen and what they are doing to prepare.
If you’re blogging from a bunker in Wyoming, I want to know about it. If you’re buying foreclosures in Vegas I want to know why. If you’re a boat manufacturer tell me about closing down for the rest of the year. If you’re in school, will you continue to pay tuition with no job prospects, or will you take a leave of absence? Are your friends thriving? Struggling? Have you taken a pay cut? Are you killing it in the stock market?
I want an anecdotal sharefest.
Also, Ben, is your PO listed above current? It’s time to break you off some…
Yegads — SoCal real estate is literally red hot again. (We had our turn in San Diego last fall…). This is the second disastrous fire season in as many years. Why is it again that people are willing to pay several hundred thousand dollars for a structure in the path of a future inferno?
Wildfires raging through Southern California
Peter Fimrite, Chronicle Staff Writer
Saturday, November 15, 2008
(11-15) 04:00 PST Los Angeles - –
Chaotic, gusting winds fanned wildfires all over Southern California Saturday, reducing 500 mobile homes to cinders and forcing thousands of homeowners and even firefighters to flee as flames as high as 50 feet licked at their heels.
The Sayre Fire, the worst of the blazes, raced through Sylmar, on the edge of the Angeles National Forest in the foothills of the San Gabriel Mountains, engulfing as many as 1,000 structures, forcing the evacuation of 10,000 people and shutting down major freeways, including Interstate 5.
Here’s an interesting story, me thinks.
I stepped out for a smoke tonight on my back porch. Next door was the young 22-year-old partier who is always coming home around 4 am from the bars.
We chit chatted briefly, and I asked him what he was up to for the evening, making polite conversation.
He and his roommate were frying up some wings and shrimp and drinking a case of beer, he said. He’s stayed home the previous weekend and realized that the $200 he’d saved in bar tabs was pretty nice, and had pledged to himself to stay home at least two weekends per month to save money.
It’s just an anecdote, but a pretty profound one. If the single 20-something next door with a good job is staying in and drinking a 12 pack instead of going to the bars where he might actually meet some women, then we know that consumer retrenchment is getting more and more severe.
It’s a wise move on his part, but man, the November numbers are going to be ugly.