Bits Bucket For February 26, 2009
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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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first?
Is it possible to get insurance on a car after it has crashed?
Sure! as long as you don’t file a claim on the crash.
Is there govt-sponsored insurance available which could be used to file a claim on the crash?
What about gap insurance? I deserve to be paid for the depreciation.
Why would you be driving a car with no insurance, unless it is rebuilt from previously having crashed ?
“Why would you be driving a car with no insurance,…”
If I knew the government would give me free insurance that included provision for a claim on a crash that just occurred, why would I bother buying insurance?
If you can get to the microphone at the next Obama appearance you could get whatever you want.
If the government owns AIG why can’t we all get insurance free now? It would save me thousands a year. Auto/health.
How about home owners insurance too? It could be bundled up with the free mortgages Obama’s sending out to everyone.
“If you can get to the microphone at the next Obama appearance you could get whatever you want.”
not if you are a middle aged white male.
Was hard not to notice that in the “crowd shots” on TV, during Obama’s inauguration.
Three million people on the D.C. mall………of which, maybe 15 were middle aged white guys.
Maybe all the middle-aged white guys were on vacations after the bonuses were handed out by failing banks.
Yeah, we wish.
“…of which, maybe 15 were middle aged white guys.”
All members of Congress, I presume?
My heart bleeds for you.
All us middle-aged white guys had to work that day.
Which reminds me of a story I heard:
Small business up and running on Friday afternoon. Suddenly, all the power in the facility goes out. A few minutes later, announcement goes out over the P.A. system……”All non-essential personnel are excused for the rest of the day”.
Everybody that left got a layoff notice next week.
CLAIM your “friend” Stole it and have her arrested then you can use their insurance to cover your azzzzzzz
True story. I had a house that I had insured. After about a year, the mortgage holder calls me says I don’t have insurance, yada yada. I call the insurance co. and it turns out the f’d up. I haven’t been insured for the last year. Now they want me to pay last years premiums, as well as the current year.
So I ask, why would I pay for insurance on a previous year, like was my house going to burn last year?
Long story short, I found a different insurance co.
‘first?’
Haven’t seen that in a while…
please dont let this turn into slashdot, where the first 85 posts are all “FP! $uck0rz”
Murst!
http://finance.yahoo.com/news/Newhome-sales-tumble-to-apf-14478139.html
New-home sales tumble to record low annual pace of 309,000 in January, no relief in sight
If I’m not mistaken they are still overbuilding by about 40% at this point. Are they still trying to make it up on volume?
Well, they have to do SOMETHING to keep housing unaffordable, right? Wait… how does that work again?
It’s been almost 20 years and Japan is still spiraling down. Japan took its time and made a whole bunch of economic mistakes. We are making those same mistakes at lightening speeds. At this rate of mistakes, we are not going to last 3 years from Aug. 2007.
Store food and water. No, I’m not kidding.
Got a pep talk from my boss yesterday preparing us all for the coming depression. I am still confused about whether he was referring to our internal situation at work, or the global economy. It was quite a deflationary follow up to OBwan’s uplifting fireside chat.
The owner of our little company, who draws a 6 figure salary, came to me a half hour ago asking how much he still owed on the company credit card because “I need that 50 bucks a week I pay on it go away so I can survive.”
Re: $50/week to go away.
I want a magic white pony too. Preferably one that flies. With rainbows that stream out of its @ss.
Somehow it’s not happenin’! What to do?
Silly boy. We’ve all got our magic pony now, that shoots rainbows out the ar$e. What more do you want?
Candy?
I want a magic white pony too. Preferably one that flies. With rainbows that stream out of its @ss.
A trip on the short bus with some magic dust should do the trick.
RE: I want a magic white pony too. Preferably one that flies. With rainbows that stream out of its @ss.
Call Olygal…I think she’s got a corral full!
A trip on the short bus with some magic dust should do the trick.
Are you confusing me with the Beard or Turbo-Tax Timmay?!?
‘Call Olygal…I think she’s got a corral full!’
Now, if you recall, I always used to announce I wanted a magic PINK pony that could fly to the moon. Pink is better, in this case, as the magical moon-fairies like it more. So, no—I have none a them white magic ponies.
*lofty sniff *
can you explain this to me? is he just paying the minimum on the card?
Cause if he needs 50 bucks well…I am sure there are few truck stop restrooms he could make it at
The company pays the bill in full every month, and he’s just paying back some personal items he had charged on it. He just has 50 deducted from his pay each week and has 3 payments left.
Then asked him if after the card expenses are paid off he wants to apply it toward the big ol’ note he has outstanding. “Hell no.”
Sounds like our sales guys here. I thought they were doing great and later found out they were in hock to the company for this and that extravagance. At a mediocre salary I am probably doing better than any of them.
“It’s not what you make, it’s what you save.”
Ain’t that the truth.
Save? Not according to Kiosaki/Rich Dad. His stuff is all over the local airwaves, saying that Saving is bad, the wealthy still get wealthy because They have a financial education.
Guess whos coming to town this next wknd?
I assume you immediately started updating your resume?
LOL
The company itself is doing ok, he’s just having a tough time right now personally.
Sheesh Blano…He only “mentioned” his need for $50 to discourage you from asking for A RAISE. It is a common pre-emptive wage war tactic.
Be prepared to OFFER him $17.95 a month, some moldy Micky D Happy Meal coupons and a hard time while you DEMAND a 7% raise.
Owners NEVER know what they have until employees TELL them. He will go away happy…Trust me
Good point mikey!!
I’m supposed to take over as Controller in April. Been wondering if I was going to get a title promotion without the accompanying pay increase. Seems quite likely.
Sheesh Blano..He only used the lame “I need that $50 bucks a week I pay on it to go away so I can survive” line as a pre-emptive Wage War tactic. It was merely designed by businesses across the country to discourage good hard working employees from even considering about asking their yearly raises.
This is also a common annual, semi-annual ritual or ploy frequently used among owners that have no idea or overall comprehensive employee payroll strategy.
DON’T fall for it. Be prepared to OFFER the owner a $17.95 a week living stipend, 3 moldy expired MickyD “Happy Meal” coupons and a real hard time while you DEMAND YOUR 7% yearly Pay Raise.
94.9997% of small business owners have no earthly idea of what they own or are worth UNTIL some kindly employee TELLS them. He will probably just away away dazed and confused but content and will not dare bother you until this time next year…Trust me
PS..Feel free to contact DinOR about our unemployment compensation Program and Ben regarding part-time HBB work
“94.9997% of small business owners have no earthly idea of what they own or are worth UNTIL some kindly employee TELLS them. ”
I am glad to know from your personal first hand business owner experience that I am in the top 5% of something. I am certain you must have first hand experience to make such a broad generalization. I have 25 years experience as a successful business owner and I did not know that I was an elite one!
A pep talk?
“A pep talk?”
I keep getting those from one of my”superiors,” via email, no less. I’m always tempted to reply, “fire people, or don’t, but for the love Jeebus, stop freakin’ ruminating.”
Perhaps I misspoke — it was more of a morale stress test.
LOL, we had one of those last month. The CEO says don’t panic, but we’ve got a freakin crisis.
“The CEO says don’t panic, but we’ve got a freakin crisis.”
Visions of W with that deer-in-the-headlights expression on his face last fall when he got on national teevee to share his PANIC NOW message with us are dancing through my head.
You should see our sales meetings…
I’d talk about all the -really- long faces, but the truth is there aren’t that many of us left to be long faced.
Things usually pick up every month after December in a very predictable pattern. Instead, numbers are down 10% every month so far from December’s record-low.
Dark days ahead.
come on guys…why so glum…we’re getting outa this by Q3 2009.
my uncle ben says so.
Its the same everywhere I’m afraid. My firm (architecture) recently laid off 40% of their staff. From mail room grunts to associate level positions. It’s rough out here. We’re one of the top 100 firms in the country by billing and we’re in Washington DC which insulates us somewhat but it sucks everywhere. Friends in NYC, Chichago and LA say it’s much worse in those areas.
We (used to) do a lot of high rise multi family (read condo towers, ‘ducks and waits for thrown objects’) Mid 2007 it was like God himself threw a switch. Buisness didn’t slow down, IT STOPPED. Were toast.
I myself am stocking up on food, booze and cigs and NO I’m NOT kidding.
You can tell the stress level has increased where I work as the management is in overdrive with the BS bingo catch phrases. If you’re not familiar with this google BS bingo.
E.g.
Be creative and think outside the box.
Look for synergies.
Look for oppurtunities.
Let’s increase the wow factor.
This should be low hanging fruit for us.
Let’s put this on the fast track.
We should be able to leverage this.
And one of my all time kool- aid drinking favorites - We need to redouble our efforts.
Perhaps we should start a HBB BS bingo board using phrases like
House prices always go up
Suzanne researched this
Hope
Change
Credit crunch
Legacy assets
FB
Sheeple
Alligator
No-Doc
Stated income
Neg-AM
Ninja
MEW
Realtwhore
Bankster
It’s a buyer’s market.
Jingle mail
Wishing price
Suspect there a few other word(s) that could be added to the list.
If you think you have it bad, consider this scenario. Income down 95%, can’t pay the mortgage, can’t pay the association fee, 50% underwater on what used to be a $750,000 hi-rise condo.
I know realtwhores who might be thinking about jumping off the balconies of their overpriced hi-rise condos.
Talk about a swan dive…
“110 %”
“Perhaps I misspoke — it was more of a morale stress test.”
LOL… Priceless!
My firm (architecture) recently laid off 40% of their staff … Friends in NYC, Chicago and LA say it’s much worse in those areas.
Almost everyone I know in architecture is dead in the water.
My sweetie is an architecture librarian and she has said the entry-level and internship jobs have completely dried up.
We have one friend, an interior architect, who’s doing pretty well at the moment. He has a big restaurant redesign in the works. When I talked to him about it, he said, “I have no idea why they’re willing to spend all that money right now, but I’m happy to take their money.”
RE: Almost everyone I know in architecture is dead in the water.
Following the government bail-out of the Pig-Men I had a conversation with my brother relative to the fact that I thought big segments of the economy would move underground and go to a cash only system.
Couple days ago he told me about the relative of a friend who’d been laid off 6 months ago by a Beantown architectual firm. Seems the relative recently received a call from her old firm, saying they had work for her with the caveat…
…reimbursement is $500 per week cash money as an “independant contractor” for whatever work we give you.
No health insurance, no vacation, no sick time, double SS levy, (self-employment tax-her baby, now), no unemployment insurance extensions, yada, yada, yada…Take it or leave it.
And it’s down the third world rat-hole we go.
“WE HAVE BEGUN THE ESSENTIAL WORK OF KEEPING THE AMERICAN DREAM ALIVE IN OUR TIME.”
-B.O’BAMA Feb. 17th, 2009
Say, ET, how is your sweetie? And how is your little boy doing?
How about we have a cute little HBB baby gallery! We haven’t see mini-muggy for a bit. And then another lengthy gallery featuring penguins! And frogs! And then endless pictures of our shoes! And any tiaras we may have!
*falls smack off the chair into a twitching puddle of joy on the floor*
*gets back up and sits down sedately *
No, I was kidding about the shoes and tiaras. I fondle mine all the time, and anyhow, that seems vaguely unwholesome. But I would like to see a photo of mini-ET and mini-muggy.
I like to see cute babies. And I don’t care if all a you insensitive oafs think that’s girly. Because I AM a girl.
The most recent photo I have is the last one I posted. The last two weeks have been crazy here. I barely have time for anything, but I still manage to make it to the HBB for a few minutes here and there
Hi Oly.
Both my sweetie and my critter are doing well, though the boy has been teething lately. That can be challenging at times.
Here are a couple of recent pictures of him I like:
http://rayonorlon.com/?p=823
Arrrrrahhhhhh! *that’s the actual sound I made *
How freakishly darlin’ IS the boy! Gosh, good job there, ET.
I wish we had a little more fear and panic here in government. Revenues are down, although they don’t seem to think it’s that serious. Of course, they are already planning in internal documents to ask for a raise in millage rates in ‘10. (Oops, I told on somebody.)
They don’t want to raise front line employee raises no matter what, so instead they are frittering away money on new vehicles (but city depts just got new vehicles!) and on trophy land purchases and on renovating Ironwood, the money-bleeding golf course. They could pay for nice raises for the employees AND the managers if they just shut that boondoggle down.
Another fun fact from internal documents: various pay raise/no raise/low raise scenario, but none in which front line employees get paid and managers (who got nice raises last two years) get nothing. Oh, and get this, they did this “pay study” which raised the pay of the managers (white people), but when they found out they were grossly underpaying the bus drivers (black people) they said “we don’t have to pay you because you make it up on overtime”. Btw, little overtime to be had these days. And that OT they used to be making was in violation of DOT regs. What a lot of lying sucks.
How freakishly darlin’ IS the boy! Gosh, good job there, ET.
(Blush.)
Oh, thank you. I’m rather partial to him.
He’s farting on my lap right now in appreciation, in fact.
ET,
What a cutie. BTW a happy late birthday.
Lets go out there and cram one for the Gipper!
ET he is adorable, and I love his future comb over.
Just too cute.
I raised the subject yesterday at my PT’s office. She said her mom and dad had been storing stuff for months. Her parents are preparing to install an electric fence around their 7 acre property. The patient next to me said her dad has been preparing too; they already have an emergency meeting spot.
Is the fence run off of solar power?
RE: Is the fence run off of solar power?
Goin’ green, LOL!
Winner…One Liner of the Day Award.
Electric fence = lawsuit opportunity.
well then its not putting out enough amps, is it?
Story time: A man got fed up with the neighbor’s free-running dog getting into his trash can on trash day, so he ran an extension cord to it and electrified the metal trash can with house voltage.
Then the neighbor’s kid laid his bicycle against the trash can.
The man lost everything he owned.
Story time: Muggy used to touch electric fences for fun, at the farm, as a kid.
Anyone surprised?
City slickers pee on an electric fence….once.
Farm electric fences have current limiters. You don’t want to fry your own cows or horses.
combotechie: I’m glad to hear that the guy lost everything. I consider people who do harm to cats and dogs to be white trash a-holes in need of some kind of education or punishment.
‘Anyone surprised?’
Nope. Not one little bit. But I AM quite surprised you managed to produce such a darling kid as the mini-muggy, though. Let me explain: First, that you managed to stay alive long enough to grow to manhood, second, that you made it to manhood with all yer bits intact, and thirdly, let me take this opportunity to hope that your no-doubt adorable and brilliant life-partner frequently explains to your mini-muggy: ‘Don’t act like daddy’.
Too bad bicycles have rubber tires.
“that you made it to manhood with all yer bits intact”
One of my friends lost a bit in a skateboarding accident.
Last time neighbor’s dogs charged across our property line and circled my wife sitting on the ground with her little pointy stick, the neighbor was breaking 4 different laws. Leash it or loose it.
shoot it. done.
While riding bike today, some idjit lady comes across the lawn, and her stupid dog goes into frenzy at me charging/barking etc as if it was going to knock me over. Scared the crap outa me.
It was all I could do to keep from screaming at her or kicking at her stupid dog. She seemed to think her precious was just fine.
I grew up in the country and when any dog charges, it isn’t to sniff, they usually bite. I was ready to start kicking. Probably would have fallen off bike. Not a kid anymore. Seems alot of us are having our birthdays lately.
Perhaps Obama, refering to getting rid of the national debt, means repudation of debt will happen a lot earlier than we thought?
I expect repudiation of wages and salaries will happen before repdudiation of debt.
It is not that hard to imagine a world where the soup lines wrap around abandoned malls, forgotten factories, and crumbling, stripped houses that are still “selling” for absurd multiples of incomes… not that anyone will have an income, of course.
Everybody who actually works in this economy is a lot closer to the problem than the Washington pukes. Thus, our up close and personal view is unfiltered, vs. the view from the lofty heights of Wall Street and D.C.
They are six months behind the power curve, when it comes to dealing with the problem.
The Nikkei hit a 26 year low in the 7,000 neighborhood this week. My foggy recollection is that its all time high was about 39,000 or so back in 1989, so it is still off in nominal terms by over eighty percent from the late-1980s peak.
I wonder if this portends anything for the U.S. stock market?
Asia Times Online
Japan
Feb 26, 2009
Aso’s US visit a double-edged sword
By Kosuke Takahashi
TOKYO - Japanese Prime Minister Taro Aso’s days in office might be numbered, but he put on a brave face during his meeting with United States President Barack Obama on Tuesday at the White House, stressing the importance of the countries’ bilateral alliance.
…
But his visit to the White House - the first foreign leader to call since Obama took over in January - failed to make big front-page news in any Japanese newspaper on Wednesday - it was overshadowed by the benchmark Nikkei 225 stock average briefly falling below a 26-year closing low a day earlier.
“…I wonder if this portends anything for the U.S. stock market?”
Ha, speaking of morale stress test…what if the markets go back to daily swings of + /- 15-40 points a day
“Store food and water. No, I’m not kidding.”
Good idea. Look at what happened in Japan.
“Look at what happened in Japan.”
Yeah. Life went on. As it will in the USA.
I think those ramen noodles can last 100 years.
Let’s all watch: Tampopo.
LOL
FPSS: Of course some whould argue that A Taxing Woman would be more appropriate.
I don’t know about where you live, but the populace in my area has absolutely nothing in common with Japan. After hurricanes, when we have to go a week without power, gasoline, and fully stocked shelves all hell breaks loose. We are a fractured society that tolerates each other during the best of times. People lose all civility when they are unsure about supply lines for a week, I can’t imagine what it will be like if some necessities are cut indefinitely.
RE: I don’t know about where you live, but the populace in my area has absolutely nothing in common with Japan. After hurricanes, when we have to go a week without power, gasoline, and fully stocked shelves all hell breaks loose. We are a fractured society that tolerates each other during the best of times. People lose all civility when they are unsure about supply lines for a week, I can’t imagine what it will be like if some necessities are cut indefinitely.
REALITY PARAGRAPH OF THE DAY!
In NO…It was 72 hours to Anarchy!
Well, a lot of the anarchists were bused to Houston after they stopped anarching.
Katrina Refugees Shoot Up Houston by Nicole Gelinas
We’ve been going off a cliff since Aug. 07 and policymakers continue to mash the gas pedal. They are entrenched and will not reverse course until we crash.
Zombie banks don’t make new loans at bubble rates. They sit on capital injections. New capital goes to prop up bubble assets. Meanwhile, quarter after quarter, real assets continue spiraling downward exposing new losses that require even more new capital injections.
Policymakers are buying time, arguing the decline in all asset classes is only temporary, arguing the recession will be short-lived, hoping the decline stops, hoping things turn up next year. These policies lock us into the downward spiral.
Well said.
” hoping the decline stops, ”
Hope in one hand and spit in the other and see which hand fills up first.
It isn’t “spit”. Replace the P with an H.
I disagree. Everyone is trying to delay the day of reckoning by dumping bad debt on taxpayers before things get marked to market. This isn’t just because of policymakers…it’s Enron and Arthur Andersen X 200.
Wall Street colonized the SEC. No oversight, no rules, party like it’s 1999.
Yeah. Life went on. As it will in the USA.
Well only for those of us who annually saved 30% or more of our incomes.
Japan has industry and the people have savings. We have Starbucks.
we ain’t japan.
And japan was local, this is a global problem. If you are are poor while the rest of society is OK then things are MUCH BETTER for you than if everyone else is broke too.
Exactly. The demand for Japanese goods abroad helped Japan not to collapse into a Great Depression. Sure, they had a lost decade or two, but it was a recession not a depression. “It is different now” in the sense that there is no country in sight, that will pull up the rest through demand for their goods and services.
Welcome to the GD II.
Things seem to be status quo in Tokyo. I am there several X per month and nothing seems off.
According to Yahoo, Japan’s God of Poverty is taking the blame for their financial crisis.
Gotta love superstition!
“We are making those same mistakes at lightening speeds.”
That is what happens when we keep electing big government Authoritarians who could care less about the constitution or freedom of any kind (both Dems and Rebups). They trash talk capitalism while slowly destroying it behind the scenes. Capitalism pays my bills…it pays everyone’s bills in this country unless you are a politician.
An unpopular president going to war should not sentence me to the Hugo Chavez like doom our country is now facing. Thank you very much all of you “enlightened” young voters out there! Be careful what you wish for.
Capitalism pays the bills … the election bills … legalized graft. Though “non-profits” (eg, universities, dummy foundations, even unions, I suppose) are in on this too.
Nothing like a gilded age and a bought and paid for congress. The Dem leaders will do nothing because the financial sector has purchased them free and clear.
Pelosi, Clinton, Schumer, Dodd
Scum, Scum, Scum, and Scum
paid them just like they paid the Delays, Cunninghams, Abramoffs, Roves, LIbby’s, Stephens, Craigs of Idaho, and Palin’s.
The list includes them all. Or aren’t you looking?
+1 gator.
Anyone see the WSJ article yesterday on the Japanese government looking to buy stocks, to prop up their stock market? For some reason that article doesn’t show up on the WSJ website, that I can see anyhow.
That’ll end well. It’s just a proposal at this point - I wouldn’t be surprised to see it proposed in the U.S. before all this is done though. The Man is throwing the kitchen sink at the economy at this point.
What if the new government made us buy stock to prop up business?
With what?
True.
NO KIDDING!!!
Lessee, we can add stocks to the long and growing list of things they’d “like” us to buy: houses, cars, clothes, vacations, college education, baubles, movies, computers, and now…stocks.
“With what?”
Ha ha - has that question ever stopped the U.S. government from buying anything?
The gov is making us buy stock at this time. You just bought BAC, GM, C, AIG to name just a few. Oh, don’t forget how much Fannie and Freddie we all have in our portfolios. No, you aren’t allowed to sell any of it.
Can you say “Social Security Privatization?” A couple percentage points of US payroll going into the stock market would re-inflate that bubble (temporarily, anyway.)
But you can never, ever sell!
Social Security Privatization was the biggest piece of lip service ever. It’s not even remotely politically feasible, because it will expose SS for the Ponzi scheme it is.
Retiring person:
“Wait, you mean:
A. I invested $300,000 in social security over 40 years, and
B. The stock market was up 200% over 40 years, but
C. I only made $10,000 in gains?
What do you mean ‘no capital basis’???? I thought you said you invested my savings in the stock market!!”
… and then the lynchings begin.
What does a broken toe look like?
In my wife’s case, the little toe was sticking straight up, like the antenna on a wireless router. About all the doc could do was suggest she tape it to the next toe for a few weeks.
Swollen and bruised.
And maybe a little bent.
and hurts like hell.
Alan Greenspan’s head.
LOL! Now that you ‘mention’ it?
Recently I was power walking into the kitchen when my left pinky toe walked straight into a metal chair leg. The force was so great that the toe broke and went straight to the left. I knew it was broken and went straight to the hospital.
The doctor performed a reduction, where I got a large, local injection to help with pain and then she pulled very hard on my toe and tried to set the bone in line. It did not appear to work very well and I wondered if would ever be able to wear shoes again without needing to cut out a little hole for my protruding toe.
The treatment in my case was also “buddy taping,” but I studied my x-rays and could see how my bone was naturally shaped. I made sure to put a roll of gauze at the very base of the toe to put pressure on the bone outwards and then tape the top of the pinky very tight to the 4th toe (causing pressure in the other direction). This made the bone grow back exactly as it was before the break. After 4 weeks the orthopedist took another x-ray and said it was one of the best outcomes he’d seen.
An awesome fixit story! I approve.
Ahhhh…and the story brings back the memories, too…
My brother Al made himself a sterling silver fingertip for his right index finger after he accidentally chopped the end off his meat one whilst building a semi-submersible for traveling the irrigation canal. (look, it’s a long story, I’ll tell that part later).
Actually, I guess that’s not a real fix-it, though, because it stayed chopped off.
The fingertip is pretty, though. He gave it to me later. I have it in my jewelry box.
I still have my wisdom teeth, also in my jewelry box.
Your story would have been better if you’d used Duct Tape instead of gauze bandage. Overall though I agree. An excellent fix-it tale.
Purple.
Broke my big toe, after I saw the movie, Flashdance.
I was all excited and dancing to the music, and kicked my toe into myself. Ex said, on no, you didn’t break anything, you wouldn’t be able to walk..we rode bikes for 5 hrs, took off my shoes to air out feet, and never got the shoe back on.
The Color Purple rings a bell.
It’s not how it looks, it’s how it feels. My little toe dislocates periodically since I broke and dislocated it 2 years ago. I can certainly tell when it goes by feel, but it also looks detached from the others, swells up and then turns bruised.
purple
If there was a realtor’s buttocks on the receiving end, please tell us where to mail a donation.
No way, realtor buttocks are way too soft.
Hahahahaah!
Alexandria native Niko Papademitriou, 27, became an investment banker with a Cleveland firm soon after he graduated from college. The money was steady enough for him to fly regularly to Manhattan to see his girlfriend and take her to upscale restaurants such as Bond Street and Cafe Gray.
“A large aspect of my life — three out of the first five conversations that we had — I told her, ‘You’re not going to see much of me in the next 15 years if we start dating, because I’m going to be making a lot of money.’ ” He thinks that worked in his favor, “not so much for the money, but for the drive. It’s one of those things in men that women find attractive.”
Since being laid off in November, he has moved back to Alexandria to live with his mother. He now takes the Chinatown bus — for as little as $5 each way — to visit his girlfriend. Round-trip airfare between Cleveland and New York City averages more than $200.
“It’s definitely putting stress on our relationship,” he said recently, sitting in an Old Town cafe. “It comes back to this whole manhood thing. Like, can you be the provider, not just for yourself but for others?”
It’s been tough on his girlfriend, he said. “She knows that she needs to be this understanding, positive influence in my life. At the same time, there is a lot of fear on her part, knowing that my industry and the one that we had kind of mentally projected ourselves and our way of life on could be over, or at least on pause for a while.”
Lindsey Schwalb, 22, of Arlington said the financial crunch has made men she knows more amenable to settling down. “People are looking for some form of stability. Instead of someone you have to impress monetarily, they want someone they can concentrate on spending quality time with.”
Welsh said he is scaling back on dating costs while he builds a new business, an Internet marketing company.
“Now I’m more inclined to take a girl to a good ethnic restaurant,” he said, whereas before, “I was constantly worried about being judged for how much money I was spending.”
BWAHAHHAHAHHAHAHAHAHHAHAHHHHHHHHHHHHHHHHHHHHH!!!
The CCU needs to designate single yuppies as a protected class. Such hardship cannot stand!
“The CCU needs to designate single yuppies as a protected class.”
No way! They are “Victims!!!”
My goodness, thanks, fasty.
Man, there’s so many things to laugh at in this article that I’m having a hard time knowing where to start.
+1
The whole thing is beyond ridiculous. It’s almost better than alcohol.
Start with the $200+ booty calls.
Um, and this is the reduced _recession_ price!
Start with the $200+ booty calls.
What’s ridiculous about a $200 booty call?
If you got the money, I can think of worse things to spend it on… strippers for one: same price, all tease, no please.
Oh, jeez. Another Internet marketing company. Pardon me while I shield my computer from the e-mails that will inevitably be heading its way.
“Lindsey Schwalb, 22, of Arlington said the financial crunch has made men she knows more amenable to settling down.”
Especially if the woman has a job.
Yeah, that was my thought too.
Surely there’s got to be some way to utilize these worthless wastes of oxygen. Perhaps there’s an alligator farm in need of fresh meat, and we can harvest their organs beforehand, then sell them to pay back TARP money.
RE: Now I’m more inclined to take a girl to a good ethnic restaurant,” he said, whereas before, “I was constantly worried about being judged for how much money I was spending.”
Whipped dog loser…Man, I’m sure glad I don’t have to worry about this “Am a Man?” crapola any more.
The seating for a Springsteen concert is ALWAYS better when you hit the Ticketmaster button for a solo.
Seating for 2? See ya in the nosebleed 3rd balcony section.
He will get dumped.
Greek, Irish, and italian boys/fellas take a long long long time to marry their long time GF’s. They prefer mommas house.
It sounds like the Harvard endowment some how morphed into a hedge fund in recent years.
On The Cover/Top Stories
Harvard: the Inside Story of Its Finance Meltdown
Bernard Condon and Nathan Vardi, 02.19.09, 06:00 PM EST
Forbes Magazine dated March 16, 2009
The superstars at Harvard defied markets for years– until now. Here’s the inside story of how they finally tripped up.
Stocks were tumbling last fall as the new school year began, but at Harvard University it was as if the boom had never ended. Workers were digging across the river from Harvard’s Cambridge, Mass. home, the start of a grand expansion that was to eventually almost double the size of the university. Budgets were plump, and students from middle-class families were getting big tuition breaks under an ambitious new financial aid program. The lavish spending was made possible by the earnings from Harvard’s $36.9 billion endowment, the world’s largest. That pot was supposed to be good for $1.4 billion in annual earnings.
Behind the scenes, though, a different story was unfolding. In a glassed-walled conference room overlooking downtown Boston, traders at Harvard Management Co., the subsidiary that invests the school’s money, were fielding questions from their new boss, Jane Mendillo, about exotic financial instruments that were suddenly backfiring. Harvard had derivatives that gave it exposure to $7.2 billion in commodities and foreign stocks. With prices of both crashing, the university was getting margin calls–demands from counterparties (among them, jpmorgan Chase and Goldman Sachs) for more collateral. Another bunch of derivatives burdened Harvard with a multibillion-dollar bet on interest rates that went against it.
Harvard was getting flack from the government for not spending enough of the trust fund anyhow.
More from the Smartest in the Room.
How could the supremely politically correct ever fail at investing?
Is nothing sacred?
This is a trend we’re having a hard time defining? How is it that so many fiduciaries are ALL having the same problem?
Anyone remember when being a fiduciary meant something?
Anyone remember when being a fiduciary meant something? Judging from the recent performance of fiduciaries, I believe the term is derived from sland “douche”
It might explain why Mohamed A. El-Erian’s tenure was so short. Did he see something that made him change his mind and get out of dodge?
Yeah, this is like the powerball, in reverse.
Let’s say the government lets me issue powerball tickets. I pump out a few million tickets every year but nobody wins the jackpot and I don’t have to pay up. 3 years down the road some flunky actually hits the jackpot and wipes me out. That’s exactly what happened.
My math prof in undergrad, a very accomplished person who had written books on probability, said something about the life expectancy of a glass bottle. It doesn’t wear out and basically has infinite life expectancy - that is until it breaks. Probability is a tricky subject even in the best of times.
Why is “the stock market” so important, anyway? I’ve been trying to figure this one out. Granted, at one time, it might have been a good place to purchase shares in a decent company, have them appreciate and maybe received dividends. But it really is a huge game of craps now. A big con. It is more or less at the mercy of traders and raiders and an individual investor doesn’t have a chance. It’s like Vegas with suits. Only worse. And for the most part, the house always wins, unless you’re good at the Wall Street version of “counting cards”.
I dunno, I just don’t understand why we have to agree that it is some sort of economic indicator. Not to mention, I’ve seen a company or two really go into the crapper after it “goes public”. The twits in management tend to look for short term profit for the shareholders, rather than concentrating on making a good product or service. Not healthy. Really, at this point, I don’t have much sympathy for shareholders in a lot of companies.
Yep and now they are going to tax dividends at a much higher rate. Trash the investor class!
LOL, assuming there are any dividends to tax anymore.
True too.
And assuming there will be many investors left.
My grandfather was a bookkeeper in the 20’s. He became an electrician in the 30’s because in his words, “There were no more books to keep.”
“Trash the investor class!”
More like ‘crash the market further.’
Trash the investor class!
The investor class — which professes to know more than the rest of us and has never been afraid to carve itself a Brahmin-like role in our society — appears to have trashed itself quite nicely.
The investor class — which professes to know more than the rest of us and has never been afraid to carve itself a Brahmin-like role in our society — appears to have trashed itself quite nicely.
And it’s a beautiful thing. SCHWEET! It wasn’t their money anyways.
” The investor class — which professes to know more than the rest of us and has never been afraid to carve itself a Brahmin-like role in our society — appears to have trashed itself quite nicely.
And it’s a beautiful thing. SCHWEET! It wasn’t their money anyways.”
Now, just for the record, I agree 100% with Mr. Exeter on this point.
-Captain’s log, stardate 11:22.41 2-26-2009-
Yes. Hell did unfreeze. I noticed you also used the name exeter instead of excreter.
“It’s more or less at the mercy of traders and raiders and an individual investor doesn’t have a chance.”
Generally speaking, traders and raiders think in terms of price. Investors think in terms of value.
The individual investor has the edge because there are no external pressures put upon him. Not so with a trader or raider who has to hit performance numbers.
As I said, generally speaking.
You can be a trader that doesn’t have to hit performance numbers. You just gotta work for yourself.
It’s quite easy; I suggest you try it sometime.
yeah, until you bet against the gov’t when you didn’t realize you were betting against the gov’t (Lehman stick-save, for one).
that crap put me in a funk for five months. yeah, I made my money back but I missed out on the big waterfall in the fall (pff, whatever, I was having fun on comics books forums)
well, live and learn.
(shoulda asked Mr. Market for more money for shorting Federated, but hey, it was still fun–last time I was in a Macy’s it looked like it was going the way of Sears. skeerooed.)
“I suggest you try it sometime.”
I have. It’s not who I am.
(I spent a lot of money finding that out about myself. I don’t want to spend any more.)
Stock market was not important to me before 1989. The 1980 and 1981 recession did not bother me at all. I did not own a car. owned a bicycle and used it to go back and forth to college. I think there are many people in their early 20s today who don’t think the economy is in serious trouble.
In the long run this crisis will end and we will go back to economic freedom.
When stock market investing started to be sold as the equivalent of a savings account, the scam had the opportunity to bloom into one gigantic Amorphophallus titanum flower. Ah, that smell attracts all sorts of carrion eaters before it wilts away. Don’t worry though, another one will bloom thanks to the pollinators.
Again I’d love to see a “401K Protected Share Class” held to higher standards. No more feeding ‘all’ these clowns on a bi-weekly basis!
If we can have a “No Short List” for the financials we damn sure can create a platform of ethical and accountable companies that are willing to subject themselves to a higher level of scrutiny in exchange for a twice-monthly watering. Leave the rest as fair game for speculators for all I care.
I dunno, I just don’t understand why we have to agree that it is some sort of economic indicator.
IMHO the problem is that is is a forward looking indicator of estimated stock prices and people treat is as if it is a forward looking indicator of the aggregate performance of the economy. There is some correlation, but money has poured in due to income redistribution (reduced taxes on the rich) and the Baby Boomers reaching their peak earnings.(SOME of ‘em are saving for retirement.) This has sent P/E ratios to levels that are unsustainable IMHO. I believe that the fact that current stock prices are primarly based on estimates of future stock prices and NOT estimates of future dividends mean that stocks are still in a speculative bubble.
I am always amused how the stock market doing well is sold as an important economic indicator to Joe Sixplumber, when one sure way for a company to raise the stock price is to lay off a bunch of workers.
Oh, the market doing well is a sign that the economy is doing well for somebody, alright…
I’m amused that the stock market response is sold as an indicator of how good this or that economic recovery plan is.
An excellent question. The language used–such as “playing” the stock market–together with the seemingly irrational day-to-day swings in stock prices, which often seem to be emotion-driven, have long had me wondering why it’s important as part of a diversified portfolio to own stocks.
It’s useless to make wishes, but I wish I had listened to those little inner voices telling me that the stock market runs on madness, and I should get the hell out while the getting was good. That would have put me at odds with my financial advisor, whom I hired because I tended to get caught up in emotional investing.
Oh well, it’s all spilled torpedoes under the bridge now.
Ah, but you answered your own question: without people putting money in the market and asking “financial advisors” for advise, those “advisors” would have to get real jobs that consist of more than parroting, “The market always goes up!” while skimming money off the top in fees.
In her defense, she’s not a “market always goes up” person, and has put together a laddered portfolio of muni bonds for us, as well as trimming down the number of funds we own (I had a tendency to collect mutual funds, LOL). I was an undisciplined investor, without enough time or nerves of steel to continue on my own. And I probably would not have had the nerve to dump stocks unless I’d been hanging around the HBB a lot longer before the crash. As I said, it’s wishful thinking. Woulda, shoulda, coulda–what’s the saying? “If wishes were horses, beggars would ride.”
Personally, I’d go for one of Olygal’s magical pink ponies.
‘Personally, I’d go for one of Olygal’s magical pink ponies.’
I’ll make a note of it.
* makes a note of it *
Hypocritical too, for those states who ban gambling…….:-)
Well said.
I don’t get this at all. If you are an investor and looking at companies with long term value then you shouldn’t be all that excited about the moves.
Buy stocks that pay dividends. If they get bought out or taken over, then sell the dang thing.
My problem, and possibly your problem, is having a difficult time because the masters of the universe aka Fed/banks are changing the rules. There is also a huge fraud factor right now.
I’m going to go blow a bunch of money into some tech companies with good products, good management and piles of cash. I think they have a future and might actually be cheap right now.
Weeeeeeeee
Greek, Irish, and italian boys/fellas take a long long long time to marry their long time GF’s. They prefer mommas house.
ah well another post not being posted…sighhhhhhh
I was just saying the same thing , Palmetto.
Ponzi/con. = Wall Street.
Since we’re on the subject of “pep” talks, I’d like to relate a short passage from a little Jungian head-shrinking tome I’ve been dipping into lately. Might just apply to our never neverland economists and pols:
This is what happens around the old “midlife crisis” …
“So life calls us all to a different perspective, a settling of the youthful hubris and inflation, and teaches the difference between hope and knowledge and wisdom. Hope is based on what might be. Knowledge is the valued lesson of experience. Wisdom is always humbling, never inflationary.”
Hmmm, considering what I see and hear around me, maybe I should stop taking actions as if I were in the deflationista camp!
Water, water everywhere, but a lot more pricey to drink, or,
How falling revenues make tapping into the tap water a source of liquidity these days:
WASHINGTON - February 25 - A new report released today by Food & Water Watch, a national consumer advocacy group based in Washington, D.C., reveals that many cash-strapped communities across the country are experiencing rate hikes and a decrease in public services after selling their water and wastewater systems to private corporations.
Money Down the Drain: How Private Control of Water Wastes Public Resources highlights cities and towns across the country that have sold their water systems to private companies to offset budget deficits in an increasingly unstable economy, and the negative economic and environmental impact of water privatization on those communities.
link:http://www.commondreams.org/newswire/2009/02/25
Sounds tough in CA
“People are physically going through a slow death,” said Karen Stewart, an area real-estate agent who earned about $80,000 a year just three years ago and is now down to her last $700. “You don’t have any support and the support systems that were in place before aren’t in place anymore.”
Recently separated, Stewart, 45, said she has been without a steady income since 2006 and is living on a county-issued food- debit card. The five-bedroom house in Brentwood she and her husband had purchased for $500,000 went into foreclosure in January. She said she hasn’t ruled out moving into her Lexus sedan and sending her 12-year-old son to live with a relative on the East Coast.
‘On the Edge’
Shelley Bowen, a 35-year-old stay-at-home mom from Antioch, said she and her husband Jason are “teetering on the edge,” as they face slowing sales of his art work and a $2,500 monthly mortgage that will go up by $1,000 in April.
Even though Jason makes $90,000 to $95,000 a year as an oil painter and instructor, “we’re kind of holding our breath, hoping nothing else happens,” Bowen said. If necessary, the couple would turn to family and friends, then church-welfare services and government assistance, she said.
“…Recently separated, Stewart, 45, said she has been without a steady income since 2006″
Does that refer to her… money, her mate, or her career expectations?
From making ~$80k-$90k to using the county’s food card and church programs in only a couple of short years?
Is this the “propserity” that all the politicians want to bring back? This? A rotted out hollow log?
She is receiving tax dollars for food and still owns a farking Lexus??
This happened in GDI, too.
Early in the Depression, a woman tells Studs Terkel, a man in shabby clothes went begging on the streets. That evening, his wife picked him up … in a Cadillac.
I believe the way the article reads they are still making 80-90k and are needing to rely on church programs.
There is a lot more to this story, probably a bad coke habit.
No, if you bought a house as big as she is talking about, probably not.
Basically that along with the divorce could whipe you out.
The swings in income are what kill most people. Expect times to keep booming.
From making ~$80k-$90k to using the county’s food card and church programs in only a couple of short years?
That makes sense to me — the art market has dropped off a cliff, just like every market for cr@p we don’t really need. Artists who don’t have a decent teaching gig to supply steady income have taken it on the chin.
People are physically going through a slow death
Uneducated people who became accustomed to making a salary vastly more than any realistic valuation of their productivity are going through a slow death. Others will be fine (or at least not as bad off).
If necessary, the couple would turn to family and friends, then church-welfare services and government assistance, she said.
At what point does the couple “turn” to both adults getting real jobs? Being a “painter” is great during the boom time when people have loads of extra cash to spend on crap, but when times get tough you gotta have some hard skills.
bluprint,
Which all begs the question, what would these people have been doing had it *not been for “the boom”? I keep coming back to that. Was it their expectation this would continue indefinitely?
The other thing is that w/ bidding wars and eager buyers tripping all over themselves to throw money at you.., there was PLENTY of time to have shored up your skills. This should have occured -even- had the boom continued! Or did you think driving/talking on a cell phone/unlocking lockboxes would take you to retirement?
driving/talking on a cell phone/unlocking lockboxes would take you to retirement?
No kidding. I often wonder if I’m the only person in the world who practices self evaluation. Is it impossible to perceive that making 90 grand for doing a job, where the requirements are a 6 week course and a test, might not last?
“self evaluation” ?!? What’s ‘that’?
When you’re knocking down major bucks like that for doing nothing, you… ‘think’ you’re worth it! And now, rather than take something that pays less, they’d rather go on food stamps before upgrading their job skills.
I have to do my yearly “evaluation” soon.
Q. What are your goals for the next few years? Do you want to change jobs?
A. Good God no. I just want to keep doing a productive job at this one so I don’t have to go outside into the real world. Do you know how hot it gets in Texas in the summer?
Q. Are you intending to transition to management?
A. Are you kidding? I was “management” in my last gig. That just meant I was in charge of getting people to come into work to get the project done that might mean they would get some of their back pay (while not being paid.) Um, better to just answer this one just “No.” This might be just the skill they are looking for.
Q. Do you
A. ARRRRRGH! I already have two monitors on my computer, what more could a nerd ask for? Can I go back to work now?
I don’t think that psyching myself up for this interview is working properly.
I was in L.A. last weekend. Interesting that my friends were pretty gloom and doom, either worried about their own jobs, or talking about how their friends had already been laid off. Lots of state/muni employees already getting the axe.
But, for all the bad vibes, things still looked “normal”, ie: the nice areas still look nice, the hell-holes are still hell-holes. Didn’t appear, at first glance, to be any worse than previous times I’ve been to the city. Businesses still packed, people still eating out. Some vacant storefronts, but you don’t know which ones have been vacant forever and which ones just closed. Sure, tons of homeless people, but L.A. always has tons of homeless people.
Made me wonder what it will take for things get so bad that it’s visibly obvious to an out-of-town visitor.
We have the general mdse/food stamp debit card in Calif., compliments of us taxpayers. You can even withdrawl $ from your bank account with it, that the state puts in monthly. Some of that money you saw being spent could be an illusion.
How ’bout this:
“Nation Instinctively Forms Breadline
NEW YORK—Drawn by a strange force they could neither resist nor describe, millions of Americans reportedly dropped what they were doing Tuesday and, acting as if by instinct alone, gathered into one massive nationwide breadline.
According to witnesses, citizens across the country exited their homes in near unison, leaving behind growing stacks of bills, empty kitchen cupboards, and what was once a life of comfort to form the spontaneous, 2,000-mile-long queue…”
From The Onion if you didn’t guess…
MrBubble
An artist and a homemaker taking out a mortgage? Maybe a housepainter should do it, but an artist?
If he were to be really successful, he would want a much nicer house. If he were to turn out to be an ordinary talent, he can’t keep it. The most incredible, unlikely thing would be for him to be neither a great success or a failure.
“If he were to be really successful, he would want a much nicer house.”
Sometimes you get a personality type like Warren Buffett. What’s he live in, something like 1,400 sq ft. But a gem like Warren is a rare find.
He’s also an instructor, probably most of his income comes from that. Of course, who has money to go to art school right now?
Why does a real estate agent make $80k?
Why does an oil painter make $90k?
These jobs have never paid that much. Didn’t these people realize they were making too much money and were going to need to save and prepare for a new career when it all bit the dust?
Land of Eternal Optimism
Actually, sometimes I wondered back in 2005-6 why all these fake-ass idiots were making so much more than me, but hey, who’s laughing now?
She said she hasn’t ruled out moving into her Lexus sedan and
sendingselling her 12-year-old sonto live with a relative on the East Coastinto peonage.There, fixed.
Maybe she could “trade up” to a nice SUV and the family could stay together. Seriously though, poor kid.
I suspect the word “frugal” was self-deleted from this woman’s psyche long ago…
5 bedroom house? Lexus?
3 suggestions for her and others like her.
Live BELOW your means.
When times are lean, SAVE.
When times are flush, SAVE MORE.
DOC
Save?
Kiosaki/Rich Dad, coming to desert next wknd, all over media, stating that saving is bad, that is why we will never be wealthy. Only the wealthy get wealthier because they have the financial education that we seem to lack due to the idea of saving.
Hmmm.
Yep. going to be a crowded audience of out of work/ers.
Obama’s $3T budget.
“Ask not what your country can do for you, but what can you spend for your country.”
Hah, then I’m a better American than I thought. Though I’m pushing the budget, the clan and I are going to blow some of our greenbacks in what Oly calls Utarr come April … but mostly on propane and dehydrated, vacuum-packed grub, not to mention some pesky gubmint fees.
John Maynard Keynes. Google him.
“Ask not what your country can do for you, but what I can borrow for my friends and financial handlers.”
There, fixed it for ya!
The disappearance of these trillions upon trillions of dollars is going to go down as one of the greatest magic tricks ever pulled off.
Don’t worry though, they are going to make things completely transparent! See this giant pile of money? See it? WALLAH! It’s not gone, it’s transparent! I assure you the giant pile of money is still safe and sound right here on stage ladies and gentlemen.
And now for my next trick…..
Good one, Temporal!
So, this may sound crazy, but I am thinking about possibly going back to school although I just graduated about a year ago.
I got a degree in Engineering and work in the semiconductor industry; however, there seems to be very little future in this sector. Companies keep sending jobs overseas, while US engineers keep pilling up looking for jobs. I personally believe many of these industries will leave all executive jobs in the US while most of the engineering is other countries.
Therefore, I think it may be a good idea to start looking for another field. I am still debating what would be a good alternative; I hear from different sources jobs related to health, accounting & education will have the most demand in the upcoming decades.
What do you guys think? Any suggestions? I would really like to know what you guys think!!!
Hi Brett, I would be careful with education. Many here are predicting a bust there, too. I am in education for my day gig and I agree.
Hi,
Could you be a little more specific?
I appreciate it!
Thanks
Sure, Brett.
I don’t mean, “don’t go back to school,” I mean, “be careful about becoming a teacher at any level.” All the good reasons to be a teacher are going away.
I think we’re going to see much more affordability in higher education in coming years as well.
The credit bubble propped up the tuition bubble. Parents are realizing that 25k+ a year for second- or third-tier schools no longer seems rational, and kids who pay their own way will be looking for a higher ROI.
I’m very much pro-continuing education, but I think we’ve just recently rounded the top of the tuition bubble. It’ll be cheaper in coming years (I hope), but perhaps more competitive, as people hide out from tough times in grad school.
I am a CPA and I would reccomend staying away from accounting at this point. There are thousands of out-of-work finance people who are only a couple of classes and a test away from a CPA. Granted, most of the finance people I know aren’t smart enough to pass the exam, but there are still enough to flood the industry.
I don’t mean to brag, but I’m way smarter than most people I know. It wouldn’t be hard at all to get through accounting and become a CPA.
I’m wondering if a “health care bubble” isn’t being generated. Seems like everyone who is looking at returning to school/retraining is getting into some kind of health care field.
True, there is a “barrier” to entry in the field, because you have to get a degree and pass the state boards, but right now the rush to get into the field reminds me of the California Gold Rush.
Another service industry with inflated costs, that eventually will have to deal with the fact that their customers can’t afford their services anymore.
Brett, I’m not doubting your intelligence. I came from engineering as well and most of the people I knew in that school could easily study for a month and pass the CPA exam. In high school I was gifted, in engineering school I was average, and in business school I was a genius again.
The problem is the need to take the entire business curriculum and the required 24 upper division hours of accounting classes to qualify for the license. You nearly have to start from scratch. Most of the finance people who are out of work already have business degrees and possibly MBA’s. They only need a couple of additional accounting classes to qualify for the exam. They will soon be flooding the field while you are just getting started with classes.
I don’t mean to brag, but I’m way smarter than most people I know. It wouldn’t be hard at all to get through accounting and become a CPA.
In 2006 I finally decided to pull the trigger and do exactly that. I work in IT (have a comp sci degree) and was compelled partly b/c I was tired of the work and partly b/c I don’t see IT being a big industry in this state in the future. At that time, with the coming downturn I expected and so few IT job options locally, I thought it would be beneficial to do something else. Also b/c of personal interests I settled on accounting…
Anyway, I did all the undergrad work starting in Jan 2007 and I’m now about half way through grad school. None of it is as difficult as most people make it out to be, but I find that true with most things. For example, I took and passed the CISSP in a little over 3 hours having only studied for a week before the test and spent a few weeks studying about 5 months earlier. Everyone in the room (it was given at my employer’s location b/c we had so many people taking it, so I knew everyone) figured I failed it for sure since I took so little time. Don’t get me wrong, it was somewhat difficult and very long, but it wasn’t even the hardest test I took that month. A couple weeks later I took a 35 question test that took me 2.5 hours to complete (compared to 150 question CISSP in 3 hours 17 mins).
My point being that the people who are most vocal about the difficulty are the ones who don’t quite (or just barely) get it. I expect the CPA to be about the same, somewhat difficult in that it will be comprehensive but not nearly so tough as folks make out.
Having said all that, I think whatever you decide, it should be something you like or related to something you like. I genuinely enjoy acct and finance. This semester I’m taking a finance class which I literally get excited to go to. On Sunday nights I’m thinking about Monday, when I get to go to that class. This class is notorious, EVERYONE (all the MBA students) hates it and finds it difficult. I love talking about what we talk about in there. Acctg stuff, optimum capital structure, etc. But I’m kinda nerdy like that…
I will also have opportunity when I finish to audit IT systems, which I think will be interesting.
And John, thanks for the input. That is something I have thought about as well…but I’m already @$$ deep into it now. Anyway, I’m usually better at most things than most other people.
Plus I suspect a fair number of finance/mba graduates couldn’t get passed intermediate accounting. There seems to be a gulf between accounting and finance that most people don’t cross well (i.e. most seem to do well in one but not the other), but especially in the direction from finance to acctg.
X-GSfixer - I think you are correct about the developing “health care bubble”. When I was going to college in the early ninties Physical Therapists were making a killing and everyone was dying to get into the school. By the time they graduated the starting salaries had crashed. Right now RN’s can easily make $100k+ but I think that will soon change, too.
If anyone is considering a career in the health care field but doesn’t actually have an interest in medicine or touching sick people look into Skilled Nursing Facility Director. It is a 40 to 50 hour/week job that can easily make over $100k and good directors are always in demand.
X-GSfixer, I’ll chime in about concerns over a developing bubble in health care. The hospital where I work has a hiring freeze, our academic affiliate has laid off non-patient care personnel, and everyone is being told to prepare for budget cuts. Jobs that require a 4-year degree or more and deal directly with patients are still in demand (RNs, pharmacists, for example) but if we see a glut of people wanting to enter those fields, then in a few years they will go the way of physical therapists. Even the MDs are expecting declining incomes in the future. The current high costs are unsustainable over the long term.
John–wouldn’t directing a skilled nursing facility require experience in some health care field, preferably nursing administration ? It’s not as though someone can graduate with a degree in “SNF directing” and land a six-figure salary fresh out of school.
bluprint - good luck. I’m sure you will do fine. We won’t starve in this industry but there will be more competition for a while. Like you said, many of the people I know who went into finance did so because they just couldn’t quite comprehend accounting. Also, job satisfaction is important. I personally really enjoy accounting. When you get to higher levels you get to see every aspect of the company’s finances and you have a greater understanding of the whole company than nearly everyone else.
Elanor - There is a learning period where many new graduates work in the business office, marketing office, social services office, or as an assistant executive director at a larger facility. Most would then get a job as ED at a smaller facility and move up to larger facilities. One of our younger SNF ED’s was 27 and he was making $90k at a smaller facility.
John,
I am not a CPA, but I am an Accountant, formerly my specialty was Retail REIT’s. I enjoy Finance too, but I came at it with an understanding of Accounting. Commercial R E was a great area to apply my strengths. Unfortunately our firm downsized and outsourced, so I am freelancing. God, do I miss my medical coverage. $838/mo for 2 healthy adults is hard nut to swallow.
‘I don’t mean to brag, but I’m way smarter than most people I know.’
I often tell myself the same thing, Brett, but then I spin myself around on my twirly chair too much, so that me and the chir top ricochet off onto the floor and as I recline there, I take that time for introspection, and I wonder; ‘Maybe I’m wrong?’
But then I consider all the facts some more, and I say ‘Naw. I probably still am. The bar is pretty fookin’ low, after all’.
Then I leap up, reattach the top and twirl some more.
Anyway, my point is: self esteem is a great thing to have.
Is “self-esteem” the feeling you get when you spin around in your desk chair for 5-10 minutes?
I just thought it was “getting dizzy”
P.S. Next time you do it, take one of your cats along for the ride. They will really enjoy it.
awaiting - I’m sorry to hear about your misfortune. I got my start auditing commercial and residential real estate. A know a lot of people in those industries who are suffering. Right now I am in senior housing and so far our industry has held up okay but I don’t sleep at night knowing that, sooner or later, people without jobs will bring grandma home to collect her SS check. It is only a matter of time. In some industries it is hard to be proactive. We don’t have the ability to shut down a production line or go to 30 hour work weeks.
Wow, that story about B-school is funny because it sounds like my life. I was “gifted” in primary school, just another idiot in college (physics program), but then I went to work in admin at a transit agency and I was some sort of wizard. Once, this otherwise intelligent lady asked me to “email that percentage increase excel spreadsheet you did.” Yes, this lady DID NOT KNOW HOW TO CALCULATE PERCENT INCREASE. Oh. My. God.
Hm, it was good to remember about that, because sometimes here in Fla. I attribute the massive ignorance around me to the fact that I’m in Fla. No wait–that lady grew up in Florida! Nooooooo!
All this false modesty…
Beautiful people know they are beautiful
Smart people know they are smart
Rich people know they are rich
The era of true modesty is over. The internet has set one standard for everyone.
Maybe it’s time to launch thetuitionbubbleblog … or has somebody gotten in there already?
Brett, not to get your hopes up, but the pendulum does swing both ways. Have you ever worked with the people that the jobs are outsourced to?
I have. I am sorry to say that they are still stuck in the stone age. It is painful at best, and a disaster most times. A company that I used to work for, outsourced all of their development work to Wipro, and Tata. They also went with the cheapest labor. I got an e-mail from the developer asking how a TCP/IP network worked. The product itself was supposed to interface with a T1 network, and provide t1 to ethernet routing capability. They had no idea that the T1 interface was different from the Ethernet interface and had different signaling, as well as speed. They thought that because both had RJ45 jacks that they were the same, and could just do some half assed job. In fact the job was so half assed, that they could never, ever get the product to work properly, and the company, even though is still in business, quicly went from 450 employess to 50.
Just saying that sometimes managers THINK that they know what they are doing, when in fact they do not, and end up killing the company because they are saving some modest amount of money.
No offense Pinch, but it will simply be a matter of time before these folks come up to speed. Outsourcing to the lowest bidder is here to stay. People are just commodities.
Its similar to how no one would ever buy a Japanese car because the were very crappy and fell apart. Followed by how no one would ever by a Korean car because they were very crappy and fell apart. Now of course, no one buys a Chinese car because they are crappy and fall apart.
Of course, if the dollar becomes worth less against these foreign currencies, then the trend will be reversed.
Brett - I would also add that there is a lot of ageism in the technical fields and the jobs tend to dry up as you approach 40.
Just a quick question? Aren’t many of those same Japanese cars made here?
That is the point I am trying to get through. Even if you outsource everything, your control over it is gone, and there is no need for executives here any more. Executives like being in control while smoking bongs and playing golf with their buddies.
If there are no employees to manage, expect middle managers to go next. After the middle managers, you really do not need execs.. Hell, why even be based here. Do like Halliburton, and move to Dubai. I hear that they are building some cool islands in the ocean with sand over there.
Eventually the bad ideas of globalization will collapse due to their own weight, or we will be in WW3.
I agree 10000%!!!!
Executives love to be in power, and they only protect their own kind!!
Screw engineers! screw accountants! screw programmes!!!! Let’s just keep the executives in the US
Japanese pickups and SUVs are made here due to import tariffs making it cheaper. In the 80’s Japanese automakers semi-voluntarily agreed to limit the number of cars shipped to the US and that is when they started building plants(even those Japanese cars that are “made” in the US, most are actually only assembled).
I think you give most executives too much credit. Although they see no problem in outsourcing employees, their own hubris blinds them to the fact that they too can and will also be outsourced.
Its a race to the bottom.
‘…and move to Dubai. I hear that they are building some cool islands in the ocean with sand over there.
Eventually the bad ideas of globalization will collapse due to their own weight, …’
Speaking of, the ‘cool islands’ are ALREADY collapsing due to their own weight. Plus cockroaches come out of the faucets, for free.
I’ll go find the link. An enjoyable read, for sure.
“Just saying that sometimes managers THINK that they know what they are doing, when in fact they do not, and end up killing the company because they are saving some modest amount of money.”
Yup, because the managers drank the kool-aid and thought they were “being creative and thinking outside the box.”
We had a similar experience with Tata. Their programmers seemed rather generic and unable to grasp the workings of our niche product. We used them to impress a potential customer though since Tata is much bigger than us. Everybody is so impressed with them…I think Indians have a cachet now and people just assume they know what they’re doing.
“We must make sure we do this properly.”
If I hear that one more time from an Indian manager or consultant I’m gonna explode. I think they are taught that line just like immigrant Mexican labor is taught to always say “Ok” and nod.
For us the Indian catch phrase is “Please do the needful.”
Be careful. The plate is hot.
That phrase I always hear is “as such”
Baaaasicly…
‘Please do the needful’ was in every email I received from my overseas Indian counterpart - it has become a running joke in our office….
Brett,
I have always been of the opinion that the purpose of education is to get a student to be able to think and study on their own. You passed with a degree, you can probably learn a course of study on your own now. Like Michael Spence suggested, the diploma is merely a signal to the job market. You already have one. Now it’s about what you can *do.*
If you aren’t finding opportunities in your chosen field, you might be able to switch without retraining. I know my first choice in hiring is always those who have STEM degrees.
Cap’n Crunch
P.S. Personally think the degree bubble has to pop soon, and I work in education. I believe people will eventually repudiate the degree, instead taking just ad hoc coursework to improve their skills. There are so many master’s and doctorate degrees being churned out that their value is lowered.
Graduate degrees are just ridiculous nowadays; a friend of mine with a PhD in Psychology was approached by The University of Phoenix to teach online courses to PhD students. Who in the f*cking world would get a PhD from an online college?
My degree was in Mechanical Engineering, while my job is in Electrical Engineering. The work I do is completely unrelated to the material I learned at school. Thus, I agree with your statement about the fact that school should give you the tools to think outside the box.
The reason by which I am considering changing fields is that I do not want to fall behind the curve. I do not want to end up with a degree that is irrelevant and has no future. I think it’d be easier to change professions while I am still young and have no major responsabilities like a family.
“But I don’t want to be an accountant. I want to be…….a lion tamer!!!!”
What’s funny is, when I was a wee lass I DID want to be a lion-tamer. Then I noticed that lions eat meat, and that I’m made of meat. So I changed career aspirations. I decided to be a big-rig truck driver instead.
But, a PRINCESS truck driver, of course.
I’d rather be an elf. They can make nice cookies.
Good Python ref X-GS. You’re on it today!
I always wanted to be a trucker! I saw Smokey and the Bandit during very formative years and we had a CB radio for family trips. Good times!
I only knew I wanted to drive really, really fast and run over irritating people, and cars, and houses who got in my way, while booming out giant exciting air-horn blasts.
That’s all my little heart desired.
This was when I was 7 or so, though.
Then I grew up and learned to my wonderment and joy that I don’t strictly HAVE to be a truck-driver to enjoy these pursuits!*
Huh huh huh? A happy day for me, baybees!
*Although the strictures of my vehicle size must be allowed for, of course. Nothing I have could manage a house. Maybe I can get a tank for cheap, from Ft. Lewis, once we get outta Iraq and everything’s on sale!
Wait until I put my spoof version of “Grizzly Man” on YouTube.
A woman I was dating broke up with me after we saw that movie. She was crying, talking about how sensitive he was, and what a tragedy for manand bear-kind it was.
I’m sitting there, saying “What a Go#dam idiot”, and asking her if I should nominate him for the Darwin Award.
She accused me of being “insensitive and judgemental”. I said “Guilty as charged”.
Become a Soil and Water scientist
they make alot of money as experts as Home Builders get sued for cracked foundations.
Plus groundwater is polluted by years of heavy chemical use bt farmers. And I think we are running out of clean water anyway.
Thats what I went to school for originaly but became a Microwave Test engineer and now work in semi conductors screwing around with GaAs PA’s not so great anymore.
If I had the time I would go back and finish my degree in Soil Science.
Out sourcing story. Just today I was on a conference call from my old company it seems they can’t get a circuit board to work right about 50Ghz bandwidth. Thats too bad, all work is outsouced and copied from my old designs, many questions about how I did this and that all not related to their problem which I think is a poor ground return on a multi layer board.
But then, the institutions of higher learning that presume to a higher status are a guild. We, the great unwashed, are not permitted to take a la carte courses. We must “matriculate” into a “degree program”. This is still great business model, because you lock in the tuition for the duration. Sort of like an annuity on steroids. So the institutions that can command the premium - “go all in or no dice” - guard that prerogative jealously. We will be able to take targeted courses or certificate curriculums in their hallowed halls over their dead corpi.
The similarity to renting is remarkable. Renters, like a la carte course takers, are second class citizens. We do not feed the commission and re-set maws. But we know that we are mobile, do not spend our discretionary time on “home repairs”, and frequently get free heat - assuming we rent in a second or third-tier “institution”. We can go a course - err, a month - at a time. We reap immediate benefits from the set-up.
Perhaps this does indicate an analogous, prospective crash in higher education.
Look into consulting in your field. I work in IT, which, as everyone is aware, it constantly being outsourced. However, there is always a need for people who can design and implement systems, and do so locally and in the native tongue of the client.
I see very little hope for programming/engineering moving forward, I went to college to get a degree in programming, and, although I feel it was time well spent, I couldn’t get a job in the US making anything close to my current salary as a coder, all those jobs have been sent offshore. However, implementing the things that others have coded? That’s still, IMHO, very strong.
Michael,
I may be close to your situation. Can you be more specific as to your solution for the current and future situation?
I see very little hope for programming/engineering moving forward
Maybe yes, maybe no. I work with programmers who are on the cutting edge of test-driven development with Ruby on Rails. While languages come and go, the methodologies are constantly evolving. The Indian outsource firms are years behind the cutting edge work being done in small firms in the US and Japan today. Will they catch up? Eventually, but by then the cutting edge will have moved on to the “new hotness”. It’s a moving target…
Bottom line, set your expectations. Not all programmers are created equal. I know companies who are offering six figure salaries for senior level developers with extensive Rails experience… the kind that are actively contributing to the Rails community through code additions, research, etc. My .02…
No matter how fast they make the computers, the software just gets slower and slower…
Preach it! I just spent a morning dealing with the s-l-o-w Adobe Illustrator. It made Photoshop running multiple filters seem speedy.
If you’re doing vector stuff rather than bitmap - use Flash
Never saw the point of the love-fest for Illustrator myself.
No matter how fast they make the computers, the software just gets slower and slower…
You’re kidding right? Look, I’m not going to go into much detail here, as this board is about matters real estate and to some degree economics, but the model of “Desktop Personal Computing” is dead. There is no cutting edge work going on in this space and I would be surprised if the PC and software industry in it’s current form even existed within ten years.
Here are few things to ponder: Laptops currently outsell desktops, making up 55% of all PC sales. Cell phone sales were over 1.2 Billion in 2008. Total PC sales for 2008 were under 250 Million units. The trend is clear, portable devices are the platform of choice and network computing has come to the fore. Chip sales also bears this out as more chip companies focus on mobile devices.
Most cutting-edge work these days targets the browser-based audience, mobile devices, or is background computing related (i.e. cloud computing, scalable architectures, caching). Bloated software from the likes of Adobe and Microsoft are going the way of the dinosaur… there is a reason Microsoft continues to court Yahoo in an attempt to compete with Google.
Er… People in business and government still have to use those things … and they actually PAY for software (over the barrel of MS’s gun perhaps, but they still pay for it).
That said, Adobe and MS? What crap. They deserve to die a slow and painful death.
People in business and government still have to use those things
And businesses and governments are looking to cut costs: No need to go through the corporate PC upgrade cycle when everyone is working within a browser. No need to pay exorbitant licensing fees for Microsoft Office when Google Apps or Star Office are available. Spending $100K’s in licensing to Oracle and IBM when MySQL and Postgresql will do, you get the picture…
Government agencies and most large corporations’ technology budgets are rife with legacy costs and overstaffed because they are inefficient and slow to adjust to disruptive technology. Think back to Sun circa 1996… “the network is the computer”. They were early, but they were right.
“Old and tired corporate IT way”: Order blade servers for datacenter based on some half-baked estimate that was under/overpowered for the actual load. Waste power, cooling, and capital or face application lag/hangs/downtime.
“The new hotness”: RightScale automatically adds or removes Amazon EC2 server compute power based on real-time load. Company saves money through greater efficiency by only paying for what is utilized and can work with a much smaller staff footprint, reducing operating costs.
“Company saves money through greater efficiency … smaller staff footprint”
I’m not saying you’re wrong, but I’m old enough to have heard this refrain many, many times. IT salesweasels were making the same claims for NON-relational databases back in the 1970’s.
IT salesweasels were making the same claims for NON-relational databases back in the 1970’s.
I’ve got nothing to sell you. I’m an DBA and sysadmin by trade who’s seen the “light” in terms of the direction the industry has turned. Relational systems will continue to exist within the corporate structure and for smaller applications, but companies like Amazon, Google, and others are pushing the envelope of cloud computing and relational data stores just don’t scale there.
Here’s an interesting article on what I’m talking about. Sometimes it takes a few years (or decades) for an idea to gain market traction. The era of commodity computing and fast connectivity was the final catalyst, IMHO.
If SAP ever gets it’s act together and fully embraces open source DB’s like Postgres or MySQL for ERP, Oracle and Microsoft will be forced to change their licensing structure or they will find themselves obsoleted… only a matter of time.
Brett,
I would look into alternative certification programs in your area. Those programs tend to be especially interested in math/science people, since there is a persistent shortage of teachers in those fields. Alternative certification could be a faster, cheaper route to a teaching job.
However, a lot of schools are cutting staff right now, so be careful. In the long run, though, I think it could be a good move.
Brett,
Just my 2 cents but the Air Guard among other branches -are- hiring. They will pay off a lot of your college loans, give you a bonus and likely make you an officer. After a 4 year enlistment you can re-evaluate this rotten economy.
Don’t worry, most people that join *don’t make a career out of it. It’s a terrible time to be getting out of school but given your background you would be able to go into just about any field you like. IMHO.
The military???? That’s a rough one.. I don’t think my parents would approve; not that I base my decisions based on their opinions, but I know how concerned they’d be. I have a close relationship with them, and I would not like to be a source of concern to them.
Brett,
I think it’s great you have that kind of relationship w/ your parents. Maybe there’s a misunderstanding here? The Air Guard is mostly there to protect the U.S, *not go off to some foreign land. Likely you’d never go -anywhere-.
Another misconception is that -everyone- goes to “the front lines”. Actually even in the Army, it’s about 15 support people per troop in the field. Besides, like I say, they’d probably make you an officer anyway. But it’s up to you.
Besides, like I say, they’d probably make you an officer anyway.
My uncle is a Lt Col and he recently (in the past year) had at least one rocket blow up nearby. Evidently rockets don’t care if you are an officer.
Whatz wrong with the military? Nothing.
You get to:
-Travel to faraway lands
-Meet exotic people, and get an up-close look at their lifestyles and religion.
and……
-Kill them when they start sh#t.
Sorry…….couldn’t resist.
“The Air Guard is mostly there to protect the U.S, *not go off to some foreign land. Likely you’d never go -anywhere-.”
D, that _used_ to be the difference btw Natl Guard and other branches of the service. But no more. The Guard does get deployed overseas to fight in non-war military actions now. They’re just another branch of the military, with essentially no difference in mission.
My uncle joined the air force because he knew he would be drafted sooner than later & he didn’t want to get into combat. He did well in training & was offered a full time position training others near Colorado Springs. He also had a chance to go to Hawaii, so he went there instead. The rest is history. He actually saw the first bomb dropped on Pearl Harbor while he was waiting for a bus to take him to Honolulu for a day off (that was abruptly canceled), dodged shot & shell for the next few hours, spent the next few days sitting in a foxhole waiting for a Japanese ground assault (that fortunately never happened) & agreed with his buddy to save their last bullet to shoot themselves with rather than be captured.
Your mileage may vary. Servicemen follow orders, or else.
that _used_ to be the difference btw Natl Guard and other branches of the service. But no more.
Exactly. Case in point: as I was ETS’ed out of the Army Guard in 2002, my unit was being deployed to Bosnia for “Peacekeeping”.
My brother-in-law was Marine Reserves from 2002-2008. He deployed to Okinawa for over a year. That would have been preferable to Bosnia for me, but either way you aren’t likely to stay home in the reserves any longer.
I believe the Navy was shipping personnel to Iraq.
Brett, no offense, but as a scientist you have the propensity to think clearly.
The fact that the military exists, and that their members are sworn to protect and serve or whatever, is the reason why we can all be reasonably certain that the global water wars will stop before they cross our borders.
With jihadists dropping the nuclear option as an operating strategy, your parents are hypocrites to disparage the value of deterrence. They dare to cast aspersion on the military, while resting at ease in their homes, raising their families in peace.
Are they aging hippies, perchance, who never dug the relevance of critical thinking? Was your choice of profession a respectful rebellion against the failure of reason you endured while growing up?
The jihadists’ ability to execute on a large scale is within the realm of possibility. It is good to have a military that inspires fear.
When I hear ignorant disparagement - particularly when it is directed against the military - it makes me throw a hissy fit. Not going to apologize. Every domain has its decorticated majority. We need voices to preserve a wider perspective.
Amy, there WAS a shortage of math and science teachers. Not anymore. You should see the school districts in Florida, it’s like anyone over 40 that wasn’t already an admin, took “special assignment” jobs to get out of the classroom. Now all of them are being forced back into the classroom. Basically, if you’re a first or second year teacher in Florida, it’s like being a 2/2 condo in a mall parking lot in Orlando.
You were never needed to begin with.
There is still a lack of math/science teaches here in Texas; I hear about it on a monthly basis. I got several friends who jumped into that, and are doing ok. My only problem is the salary (about 43k for a first-year teacher in the Austin Independent School District). That’s about 25k less than what I make as an engineer, which is a considerable paycut.
That’s more than teachers start out at here in San Diego.
Brett, you make 68K as an engineer 1 year out of school? Why the heck are companies willing to pay that much to new engineers if there is no future? I’m in semiconductors also, and most engineers with 10-15yrs of experience make about 100K. Many engineers leave this field way before they get 15 years of experience, and I would agree with your assessment of the future.
I worked with them for two years as a co-op mostly working FT during that period; they kind of game a salary bump because of everything I learned with them.
If you are considering grad school, here’s a suggestion for ya. Somebody here recommended this book awhile back, and I read it. It really opens your eyes about the world of higher ed:
“Disciplined Minds: A Critical Look at Salaried Professionals and the Soul-Battering System That Shapes Their Lives
by Jeff Schmidt”
I think, rather than going into debt for additional schooling, you would be better served to get a job in the federal government. That’s a sector that’s going to be doing well in the next few years…
+1 on the government job.
We are heading the way of Western Europe of semi-socialism and judging from their experience the government jobs are the most secure of all.
+1 also on the govenment job - I’d suggest Public Transportation, plenty of funding coming our way and with the new mandates on safety for automatic train control systems there is plenty of work for electrical engineers.
Also, I’d read “Dancing With the Dinosaur: Learning to Live in the Corporate Jungle by William Lareau” available on Amazon - it’s a good look at what you’ll be daeling with.
This is my first year working much closer to the U.S. government. As in, we take the same holidays. Weird ones I never heard of before.
If you can stand sitting at a desk, get the degree in accounting. Even in bankruptcy, accountants have work. I started out teaching and got nowhere for 10 years. Then I got my MS in Accounting and worked in Corporate Finance for a Fortune 500 company. I loved the people but hated the accounting. However, I kept living like a graduate student, and made enough $$$ over 10 years to be able to retire.
I was smart enough to get out of stocks with only modest losses, don’t have a mortgage, and don’t have huge $$$ tied up in real estate. That said, Mr. Bernanke-Panky’s zero interest rates have killed my income. So one day I may have to get unretired. But not yet…
Actually, I could see myself doing that. It sounds silly, but I enjoy sitting with my computer and doing number manipulation in excel :-p
Macro macro man!
I want to be a macro man!
sorry….
Science, medicine, and engineering are more recession-proof than accounting, IMO.
Ha, ha, ha. Two moves, changing high schools, and Dad spending a summer learning TCL-TK (UN-affectionately known as “tickle” in the industry) put the lie to that notion, I think!
There are always jobs in science if you want to be a slave labor teaching assistant or torture mice for the evil boss of doom (like my sister did). Har de har har.
Oh, and I hear the Navy is always hiring. They’re cool, though. ~_^
Just go to work for the federal government, retire at 45 with 70% of your salary and free healthcare for life. If you stay in private industry, you’ll be working till you die to pay for government workers to retire at 45 at 70% salary and free health care.
LOL. Sad but true.
“Just go to work for the federal government, retire at 45 with 70% of your salary and free healthcare for life. If you stay in private industry, you’ll be working till you die to pay for government workers to retire at 45 at 70% salary and free health care.”
That simply isn’t true, even for older federal workers. For those hired since the Reagan changes in the 80’s, it’s the same crappy SS + 401k possible retirement if you live long enough and if SS survives, no different from much of the private sector that still has any sort of retirement.
Health!!
Look into patent law. There was a law practice bubble just like the accounting bubble, but as of a couple years ago patent lawyers were still doing pretty well. The ABA will insist you go at least $120,000 in debt to get the degree, so be careful about it.
Be forewarned: You need some serious math and science brains to be a patent lawyer.
Ah, yes. Perfect tie-in to my post above. Science is the basis of prosperity, ya know.
You also need your undergrad degree to be in hard science or engineering, or you won’t even be allowed to sit for the “agent’s exam” a.k.a the patent bar exam. Sorry no history, poetry, or literature majors need apply.
I started law school in 1993 to escape from the ruins of the post-cold-war defense industry. At that time PTO reg. numbers were around 32,000. By the time I got mine they were in the 42,000 range.
They are up over 65,000 last time I checked. Since most people with reg. numbers under 20,000 are dead/retired, that means the number of patent attorneys/agents has gone up something like 400% since the early 1990s.
I’m glad to be retired now. My friends still in the business are either underpaid or way overworked.
I think you write letters to Obama, your senators, and your congress person to tell them what you just told us. Microsoft, et al. complain that US universities are not producing enough engineers (which is untrue). Well, why would anyone want to be an engineer when they can’t find an engineering job due to wage arbitrage? This is not the way to encourage the work force to become a freaking engineer!
Try doing a few more classes and going into biomedical engineering. Semiconductor is down anyway.
I have never posted here before but do enjoy reading all your comments…look into the electric utility industry. go to the websites of electric utilities in the states you might be willing to relocate to.
My husband’s career sounds similar to yours, only he’s in his 40’s and the software industry was just taking off when we graduated. However, we’ve since watched many of the software jobs leave for cheaper (and less competent) shores.
I’d recommend you get into some area of medicine where you have to work with big, fancy machinery, MRI, etc. My friend makes good money as a respirator technician where she goes to peoples’ houses and fixes their oxygen equipment.
Another good area is nursing infomatics, the science of organizing pharmaceutical data.
Isn’t Obama’s plan to increase computerized healthcare information? This might be a good direction.
My $.02.
BS in microbiology followed by a MS in same with nanotech emphasis. Alternately MS nanotech direct if you can get in.
“Fewer than one in three Americans expect they will ever be able to fully retire, according to a study commissioned by Scottrade. This represents a decline from 39% in 2008 to 32% this year, according to a Scottrade press release.”
http://www.planadviser.com/research/article.php/3803
OK, 32% know their screwed.
Another 10% are public employees, who figure their pensions will be paid even if the tax rate goes to 100% and all public services and benefits for other people are eliminated, based on constitutional protections that only the pension entitled have.
And perhaps 6% are really wealthy, such as executives who cashed out before their companies went bust.
Than means the remaining 52% are morons, which is the majority.
Thus explaining the mess we are in.
Maybe those 52% actually would make more money not working and receiving Social Security & Medicare.
“their pensions will be paid even if the tax rate goes to 100% and all public services and benefits for other people are eliminated” LOL!
WT Economist, don’t laugh! That is -exactly- how those people think! They really don’t care. But that doesn’t make 52% of us “morons”. In OR we have fought and fought and when 51% of the households in the state are reliant on a state pension, it’s all over. We put up the good fight.
Did you by any chance interpret this article backwards? If 32% expect to be fully retired, that means 68% already know they will never be fully retired.
The 32% who expect to be fully retired are the govt employees with guaranteed pensions, highly paid professionals like doctors and lawyers, and the executives at big corporations…
You’re right I did read it backward!
Perhaps Americans aren’t so dumb after all.
I expect more people that are ready to retire to start robbing banks, either you get away and have some cash or you get caught and you have free room and board.
I swear, around here robbing banks is like a freakin’ hobby. Like crocheting doilies.
My credit union was robbed Tuesday, and another bank hit in a nearby city today. I guess the real robbers ran out of MEW money.
As a corollary to this, how long before we see an increase in bombings of banks like they had in the GD and the early 70s?
Bull. Plenty of Schadenfreude articles out there prove that many of the big wigs went “all in” and are losing it all now.
Meanwhile, those of us who are heavy savers (20, 40, maybe 50% of income) know that we will be able to retire one day, barring some sort of horrible catastrophe (and we’ve taken out insurance against those we can think of, and placed some bets in the market against those we can’t purchase insurance for).
Live on less than you make. A lot less. We could both be making min. wage and still pay our bills. And save.
I keep wondering who these “analysts” are who always expect the economic news to be improving.
WASHINGTON (AP) — New jobless claims rose more than expected last week and the number of laid-off Americans continuing to receive unemployment benefits topped 5.1 million, fresh evidence the recession is increasingly forcing employers to shed jobs.
The Labor Department said Thursday that first-time requests for unemployment benefits jumped to 667,000 from the previous week’s figure of 631,000. Analysts had expected a slight drop in claims.
It looks like the Treasury released the second half of the TARP money just in time, right before all the bad economic reports hit this morning.
It is going to take at least one massive bailout every week to stay ahead of the collapsing cards. Hope Barry is commited.
Wonder if there were any economic analysts in this 12,000?
NEW YORK (AP) — JPMorgan Chase & Co. said Thursday it will eliminate about 12,000 jobs as it folds in the operations of Washington Mutual Inc.
According to slides on the company’s Web site from an investor day presentation, the New York-based bank expects about $2 billion in net savings to be achieved through the acquisition, the majority of which will be realized by the end of this year. This includes about $1.35 billion related to the job cuts, the bank said.
Shares soared $2.12, or 9.8 percent, to $23.85 in morning trading.
“Dimon said he is not predicting, but is ready for: A recession lasting two years, a U.S. unemployment rate above 10 percent, and a 40 percent peak-to-trough decline in home prices.”
I’m predicting it, and as one of his customers, I’m glad he’s ready.
Staggering to think the company has tens of thousands of people costing $100 million each per year, that they don’t even need.
(Billions with a B
= 112.5K$/yr. Fully burdened, that doesn’t sound too bad. If they don’t get a suit allowance.
Financial advisor Puru Saxena says banking is no longer a growth industry and financials will disappoint investors for many years. Furthermore, if you have any exposure to hedge funds, structured products, accumulators or derivatives of any kind, he urges you to get rid of all this highly toxic garbage.
“America’s total debt is worth US$54 trillion and there is no way the US can ever hope of repaying its debt in today’s money. In other words, either the US will default (highly unlikely in my view) or it will print and inflate so that this huge mountain of debt feels much smaller in the future due to the loss of its purchasing power. Remember, the best way to make debt more manageable is by inflating the supply of money in the system. And this is precisely what the various central banks are doing.”
No one ever stops to think that the only way we currently have of printing money is to issue more debt. So unless they decide to start issuing debt-free money or long term debt at 0% interest we cannot “inflate our way out”.
If they simply did a “debt forgiveness” for everyone and hit “reset” then the economy would be able to start a real recovery.
I take it back, long-term debt is still debt that must be repaid and so cannot be used to offset other debt unless it is rolled over forever.
What you say is true. However, attempts for massive government spending financed by borrowing - more than likely from Fed - is an attempt to do the impossible, mathematically at least.
This is Time magazine trying to talk its readers down from the ecstasy of hope and confidence inspired from the president’s “A Tonal Masterpiece” speech to congress:
“No one really knows if, or how quickly, alternative energy sources can revive the economy and salve (sic?) the planet. There seems to be some confusion about how to proceed on health care.”
“His company’s model homes are starting to see more visitors and he said people who were waiting to see what the stimulus package would offer for housing may get off the fence.
“We’re selling enough to keep our lights on,” he said.”
http://www.gainesville.com/article/20090226/ARTICLES/902251029
Out of hundreds of condos in inventory, they sold 9.
Way to go, Realtwhores! Step up, and shine!
This has probably been posted before, but ties into what we were talking about in Vegas. Did the executives have any idea they were destroying their companies?
Among the Inept, Researchers Discover, Ignorance Is Bliss
There are many incompetent people in the world. Dr. David A. Dunning is haunted by the fear he might be one of them.
Dr. Dunning, a professor of psychology at Cornell, worries about this because, according to his research, most incompetent people do not know that they are incompetent.
Hence the expression: I don’t know what I don’t know.
Asked my students to rate their performance on the last exam and found similar results (n=1).
“On the contrary. People who do things badly, Dr. Dunning has found in studies conducted with a graduate student, Justin Kruger, are usually supremely confident of their abilities — more confident, in fact, than people who do things well.”
That certainly describes well the least competent person in my workplace.
“One reason that the ignorant also tend to be the blissfully self-assured, the researchers believe, is that the skills required for
competence often are the same skills necessary to recognize competence. The incompetent, therefore, suffer doubly, they suggested in a paper appearing in the December issue of the Journal of Personality and Social Psychology.”
“Not only do they reach erroneous conclusions and make unfortunate choices, but their incompetence robs them of the ability
to realize it,” wrote Dr. Kruger, now an assistant professor at the University of Illinois, and Dr. Dunning.”
Those “unfortunate choices” create lots of work for their coworkers.
Or, if they knew they were incompetent, they wouldn’t be incompetent. So, just start with the assumption: I am incompetent. To put it more kindly: I don’t know everything and my perception is always limited.
Why didn’t Dr Evil ever think of saying he would go out of business if the government didn’t pay his ransom. It would have been way easier than threatening to blow up the moon with a giant “laser”. GM = new level of sinister and evil. Gettelfinger in his hollowed-out volcano…
Does anyone else get a particular laugh out of the ads on this website?
I saw a great one before clicking here. it was “The Obama Loan Plan: Everyone approved and you never repay. Click here!”
Doesn’t that just sum up the absurdity of it all? Oh well… hyperinflation is probably on deck…
I just think it’s a bit surprising that the image of a sitting U.S. president is being (ab)used like that. Does anyone recall seeing the images of previous POTUS being used in such a manner?
Huh? What? Sorry I’m too busy looking at my dreamy Obama victory collectors plate. It’s made with real porcelain too!
This guy’s doing for crappy coins and plates what Star Wars did for action figures.
Hey if you want a real laugh go to http://www.federalreserve.gov and check out the tag line under the header. Now that’s some funny stuff there.
“The Obama Loan Plan: Everyone approved and you never repay. Click here!”
Well, the government does need to replace previous private sector activity to keep the same economy going, doesn’t it?
For the young, the loan is one you’ll never get but will still have to repay.
That Opie™ …cute little feller.
“Honest to goodness” score:
Opie™ = 1
Cheney-Shrub “Shadow” Legacy numbers = 0
“…The giant numbers are due in part to Obama administration’s decision to print all of the red ink, including the wars in Iraq and Afghanistan and national emergencies, which the Bush administration left out.”
BY Kenneth R. Bazinet And Michael Mcauliff
DAILY NEWS WASHINGTON BUREAU
Thursday, February 26th 2009, 11:18 AM
Oh fer’ chrissakes just give it up already. Nobody cares.
read the post above…
-Still- don’t care. Sorry. I’m sure the previous administration ‘knew’ the I-35 Bridge in the Twin Cities was about to collapse and they just plain didn’t give a f@ck about it, right?
Please, just stop.
Some people can’t help it, narrow minds are just that.
Jib-Jab… teeter-totter…
“the previous administration ‘knew’ the I-35 Bridge in the Twin Cities was about to collapse and they just plain didn’t give a f@ck about it, right?”
Wrong, not a criticism I’ve voiced about Cheney-Shrub, ever…
However, there is the question about their policy of hiding the America flag draped coffin’s of our dead soldiers being returned home…but it seems as of today, the cute little fella…That Opie™, has nixed nixed nixed…that deceitful practice as well.
Pentagon to Allow Photos of Soldiers’ Coffins:
“…The decision, which lifts a 1991 blanket ban on such photographs put in place by former President George H.W. Bush, chiefly affects coffins arriving from Iraq and Afghanistan that go through Dover Air Force Base in Delaware.”
N.Y. Times
By ELISABETH BUMILLER
Published: February 26, 2009
wmbz,
Let reflect on your posted accomplishments:
Comment by wmbz
2009-02-04 16:03:10
“Are yer parents retarded?
cuz ya sure are special.”
I’m surprised nobody has mentioned the stress test on banks.
—
“U.S. officials will demand that financial institutions test the resilience of their portfolios and capital against a grim, though not catastrophic, economic landscape. The test assumes a 3.3% contraction in gross domestic product in 2009, which would be the worst performance since 1946. And it assumes home-price declines of another 22% in 2009 and 7% in 2010.”
—
Last night someone mentioned not one of the 16 major banks will pass this test.
They will all “pass” - and then receive huge helpings of taxpayer dollars, which will promptly be spent on executive bonuses and trips to Vegas by the important people to “stimulate” the economy.
They will all “pass”
My Bank is an Honor Roll Student at Federal Reserve Middle School.
Hilarious! I’ve been laid up with the stomach flu the past few days, reading various blogs and I’m starting to think the nation’s sense of humor is inversely correlated to the economy.
The only thing is, what will the markup be on laughter once HMO’s get in the act?
“And it assumes home-price declines of another 22% in 2009 and 7% in 2010.”
That would be a further cumulative decline of ((1-0.22)*(1-0.07)-1)*100 = 27.5 percent over the next two years.
latest news
Obama proposes $3.6 trillion budget for fiscal 2010
ECONOMIC REPORT
New home sales plunge 10.2% to record low
Supply of unsold homes rises to record-high 13.3 months
By Rex Nutting, MarketWatch
Last update: 10:25 a.m. EST Feb. 26, 2009
WASHINGTON (MarketWatch) - Despite a record drop in prices, sales of new homes fell 10.2% in January to a record-low seasonally adjusted annual rate of 309,000, the Commerce Department estimated Thursday.
Sales were down 48.2% compared with a year earlier, the government reported, an indication that the downturn in the housing market was still accelerating as the recession headed into its second year.
Sales were weaker than expected. Economists surveyed by MarketWatch were looking for a sales pace of about 320,000. See Economic Calendar.
Builders cut their median sales prices by a record 9.9% in January compared with December in a bid to move unsold homes. Median sales prices are down 13.5% in the past year, the largest year-over-year decline in 38 years. The average sales price has fallen a record 17.6% in the past year.
It’s a ruse. Why bother?
They are telling the largest banks to go to all four corners of the globe and raise money that the banks cannot lend to prop up assets they cannot sell. If they don’t, the government will go to all four corners of the globe and do it for them. It’s a failure to accept policy failures.
All we can do now is prepare for the worst. Tough times are certain to last more than most expect. Store food and water.
The new stress test is irrelevant - all banks that have been given bailout money have already failed the old stress test (i.e. the real economy), which is the one that really matters.
“worst performance since 1946″
16 years after the crash. That would be good, right?
1946 is the big gap between wartime GDP being spun down and civilian GDP being spun up. It was a natural and very short term spike down. FWIW - I hold that that’s when the GD really ended - late 1946. We were still in the GD during WWII, it was just masked by the war itself.
The Motley Fool had an article on that 22%. They say the current loss from the peak has been 28% so far. That is several Trillion dollars in losses. Another 29% drop in two years. Motley concludes several more yaers of recession.
The Republicans should keep on voting against every spending bill and every increase in taxes. Obama and his fellow thugs in the other party will not be able to blame Republicans for the worse recession this pork barrel spending and tax hike will certainly cause.
It is very bewildering that the Repubs changed face for the better all of a sudden. Johnny come lately capitalists. Disgraceful that they became like Democrats from 2001 to 2006, but not a reason to keep voting in the quiciker path to socialism - Democrats.
What a great, great, great day!! Why after checking out the news I’m just soooooo full of that HOPE that the Dem’s have been promising. Ya know, the best thing about hope is that it requires no effort, no work, no responsibility, and it can have thousands of meanings for the masses. Like, gee I hope to win the lottery today. I hope someone will give me a ‘Vette. I hope I don’t get fired, opps, I’m retired. I hope CA RE really crashes and burns. Etc. You get the picture, I can hope for bad things to happen, good things to happen, or just hope to increase my well being at the expense of others. Could only happen in the USA in 2009.
Ron,
Well said. A local dip@zz bank ( that I had warned ) went under last Friday. In spite of my intimacy w/ the situation my ‘hoping’ they got it broke off in their @zz had -nothing- to do with it!
Tran makes new lows. A couple upside down dojis spell resistance. Holding a slight uptrend, however. Looks hellacious. We are steering into a precipice of pain.
You all know I’m a bear, but I hope we don’t go there. If we go there, I’m going to have to grow my own chickens. Can you grow chickens, Brett? Hard times on the farm.
That’s funny you should mention that, I just got a notice from the city that my chicken must go. Luckily I just had them at home while they grew. They have almost all started laying now so I can take them out to the dude ranch.
chicken=chickens (20)
This sounds worse than expected…
latest news
FDIC-insured banks charged off $37.9 bln of loans in 4Q 2008
Outlook for global economy seen to be worsening
IHS Global Insight expects the global economy to contract by 1.2% in 2009
By Polya Lesova, MarketWatch
Last update: 12:43 p.m. EST Feb. 26, 2009
NEW YORK (MarketWatch) — The global economy will contract even more than previously expected in 2009, as recessions in non-U.S. developed countries will likely be as bad as and possibly much worse than that gripping the United States, according to research firm IHS Global Insight.
Global real gross domestic product is expected to contract 1.2% this year, a steeper decline compared to a previous forecast of a 0.5% contraction, said economists at IHS Global Insight in a research report on Thursday.
Recent economic data indicate that the U.S. economy is still in a “free fall,” they said.
“The good news for the United States is that the Obama administration has moved aggressively to push through a large fiscal stimulus package and to announce a plan to limit the rise in mortgage foreclosures,” the economists said.
“These programs will probably not have much of an impact in 2009, but will likely add to growth and jobs in 2010.”
If a family makes 100K but spends 171K is that good news? Why is it good news when the government does the same thing?
If a family prints money, they can get arrested for counterfeiting.
BTW, a one month median sales price decline of 9.9 percent occurs at an annualized rate of ((1-0.099)^12-1)*100 = -71.4 percent.
This smells like capitulation, but it may last for a while given that sales are dropping off so quickly that time on the market for new homes is actually increasing.
latest news
FDIC-insured banks charged off $37.9 bln of loans in 4Q 2008
ECONOMIC REPORT
New home sales plunge 10.2% to record low
Supply of unsold homes rises to record-high 13.3 months
By Rex Nutting, MarketWatch
Last update: 10:25 a.m. EST Feb. 26, 2009
…
Builders cut their median sales prices by a record 9.9% in January compared with December in a bid to move unsold homes. Median sales prices are down 13.5% in the past year, the largest year-over-year decline in 38 years. The average sales price has fallen a record 17.6% in the past year.
Builders are faced with intense competition from foreclosures and distressed sales of older homes. Buyers are faced with declining wealth and an uncertain labor market, offsetting lower mortgage rates that are improving affordability.
Inventories of unsold homes fell by 3.1% to 342,000, the 13th consecutive decline. However, sales are falling even faster. The inventory at the end of January represented a record-high 13.3 month supply at the January sales pace. Nearly half the homes for sale have been completed.
Buy now or….ah….nevermind.
Tough to work up any sense of urgency (to buy) with those numbers.
“Builders cut their median sales prices”
As if the builders control the price. These numb skulls haven’t heard of Mr. market?
Give them credit for figuring out that if they don’t cut prices, they might keep those homes on the market forever.
SPECIAL REPORT Issue #1: America’s Money Crisis
Problem bank list tops 250
FDIC reports that number of troubled institutions soared during the fourth quarter to the highest level since 1994.
By David Ellis, CNNMoney.com staff writer
Last Updated: February 26, 2009: 2:50 PM ET
NEW YORK (CNNMoney.com) — The government’s closely watched listed of troubled banks grew during the fourth quarter to its highest level since 1994, regulators said Thursday.
The Federal Deposit Insurance Corp. reported that the number of firms on its so-called “problem bank” list grew to 252 during the last three months of 2008, compared with 171 banks making the list in the prior quarter.
“There is no question that this is one of the most difficult periods we have encountered during the FDIC’s 75 years of operation,” agency Chairman Sheila Bair said Thursday.
This is Part II of the hawking art for loans discussion the other day …
When Picasso and Warhol Backed a Condo
By Allen Salkin, New York Times
Four Picassos, three Warhols, two Twomblys and a Dali.
These are some of pieces in the personal art collection of Julian Schnabel, the artist and director who developed the much-publicized and partly sold Palazzo Chupi, an ornate apartment building on West 11th Street. As I wrote in an article on Tuesday about art being used as collateral, Mr. Schnabel had used these works as collateral for a loan with Commerce Bank (now TD Bank) to finance that building …
Apartment Buyers Abandoning 6-Figure Deposits
By VIVIAN TOY, New York Times
February 26, 2009
THE real estate market in Manhattan has become so unnerving to buyers that some are forfeiting six-figure deposits rather than close on deals they have made.
At 304 Spring Street, a sleek condominium building in SoHo with stunning Hudson River views, the buyer for the duplex penthouse recently decided he would not go through with the deal and walked away from a $780,000 deposit.
At 1120 Park Avenue, a classic prewar co-op filled with multimillion-dollar apartments, it appears that a buyer forfeited a deposit of as much as $1.1 million.
Real estate agents representing buyers of at least three other multimillion-dollar properties also report clients who knowingly left deposits of more than $1 million or hundreds of thousands of dollars on the table.
In each case, the buyers had signed their contracts before the financial meltdown last fall, but decided in recent months that because values in the luxury real estate market have dropped 20 to 40 percent, it no longer made sense to go through with their deals.
This is a total replay of the early 90’s bust. The stories could quite literally be interchangeable but this one is a LOT larger.
WSJ: Bargain-Hunters Descend, Cash in Hand
“It’s sort of like, ‘Good Lord, prices have fallen so low that even people who are willing to pay all cash are buying,’” says Mr. Lawler[.]
Ha ha, ha ha ha ha.
Cash sales are typically higher in Florida than in other markets[...] But a number of cash buyers these days, in Florida and elsewhere, are also investors scooping up distressed properties and affluent families seeking relatively inexpensive vacation homes. “Cash investors have come right out and said, ‘We can’t make a return on our money in stocks or bonds,’” says Heather Barr, a Realtor based in Gilbert, Ariz., a Phoenix suburb. “They think Phoenix has had such sharp price declines that we’ve got to be near the bottom and real estate will be a safe place to put their money.”
Knife catchers.
In some cases, cash buyers are finding that they can get a deeper discount by making an all-cash offer. In markets with a glut of foreclosed homes, lenders are becoming more aggressive to sell “simply because there aren’t enough first-time home buyers around to sop up the excess supply,” Mr. Lawler says.
So the excess inventory is spilled milk.
Cry me a river.
A separate bank-owned home [as the one which sold for $190K] in the same development sold for $133,000 to a cash investor, beating out a $179,000 offer from a first-time home buyer with financing from the Federal Housing Administration.
How does FPSS put it? BWAHAAAAAAHAHAHAHAHhahahahaha!!!
“The bank just didn’t want to take the chance with financing,” Mr. Barry says. “The lenders I work with will take a substantially lower cash offer as long as they see proof of liquid funds.”
iiii cry … when angels deserve to di-i-ie
That would be a nod to combotechie.
Lol.
“We can’t make a return on our money in stocks or bonds.”
As things get cheaper the buying power of cash increases. There’s your return.
I’ve seen a few high end properties now that are listed, “cash only”.
Financial Times
GM future in doubt after $31bn loss
By Bernard Simon in Toronto and John Reed in Detroit
Published: February 26 2009 13:14 | Last updated: February 26 2009 21:50
General Motors underlined its dire financial condition on Thursday as it reported an unexpectedly heavy cash drain in the final three months of 2008 and warned that Deloitte, its auditor, might cast doubt on its standing as a going concern.
The Detroit carmaker, dependent on government aid for survival, reported a fourth-quarter loss of $9.6bn, bringing the 2008 loss to $30.9bn. GM has racked up losses totalling $86.6bn during the past four years.
They’ll be okay, my U.S. Representative said so when answering my letter against a Big 3 bailout last December.
And a politician, they’d know a good investment when they saw one, right?
Hungary getting hungry?
or,
There’s a kind of lush all over the world:
From the Telegraph (U.K.)
The birthplace of the Rubik’s Cube has provided its government with a multi-sided financial crisis that defies any ingenious solution.
The forint currency has plummeted and unemployment has ballooned, creating a voracious debt trap that is sucking down banks backed by Western taxpayers, particularly those of Switzerland and Austria.
Laslo Gulyas, a Budapest barman, is one of the lucky few who can still meet his repayments. “In times of trouble people need to keep drinking,” he bleakly noted at the counter of a handsome pub in Habsburg-era building.
“But it is sure now that many people with mortgages that were taken because they were cheaper than local loans, have lost their jobs and can’t generate the money to make the repayments.”
Depression in the east points the way for the rest of the world:
From the Guardian (U.K.)
Anybody who doubts that the global economy is facing its most serious downturn since the 1930s should take a squint at the latest trade figures from Japan. Exports in January were 46% lower in January than they were a year ago – a phenomenal drop for a country that is so heavily dependent on sales of its industrial products overseas.
Japan has got used to economic setbacks over the past two decades: it has been in and out of recession on a regular basis. But make no mistake, this drop in exports does not mean recession: it means depression.
In the circumstances, comments by analysts that the data was “not good” and “seriously bad” were somewhat otiose. The Office for National Statistics confirmed today that the UK economy shrank by 1.5% in the final three months of 2008 and is on course for an annual decline in GDP this year of between 2.5% and 3%. But in Japan, things are much, much worse. Maya Bhandar at Lombard Street Research, says that the economy is contracting at an annualised rate of 14-15% in the current quarter. Strong exports have tended to disguise the weakness of Japanese domestic consumption in recent years: now that prop has been kicked away, growth is plummeting.
Why is this happening? Quite simply, the great engine of globalisation has gone into reverse. During the long boom, the US acted as the consumer of last resort: it sucked in exports from China and Japan. As China industrialised, it needed high-grade investment goods from Germany, and as prosperity spread in the world’s most populous country, there was strong demand for Japanese electronics, cars and consumer gizmos. Now that America has stopped spending, Chinese factories have closed. The knock-on effects of that are being felt in Tokyo and Hamburg.
But in Japan, things are much, much worse. Maya Bhandar at Lombard Street Research, says that the economy is contracting at an annualised rate of 14-15% in the current quarter.
That’s frightening, really.
(ET looks both ways …)
Where are all the posters who keep saying the Japanese are wiser and better off than we are?
(Crickets.)
Ooops, sorry, that would be me, was just getting some supper.
Japan faces a horrific demographic problem, with an aging population and very low birthrate. Unfortunately, their economy does not provide many good jobs for young people and young people are not saving very much money.
The heavy saving, cutting back spending, are Japanese households defending themselves.
So much wiser? No, the Japanese gov’t (which has a yakuza noose around its neck) let bankrupt concerns (often ruined by loans to yak-owned construction companies that went bad) keep running as zombies. This destroyed confidence but more importantly, it made recovery impossible. Eventually they tried to goose the interest rate but it didn’t work.
US has decided to go the same path. Despite what some of us were screaming, they did not make the finance sector mark to market. Loss of confidence AND the zombie banks (and other zombie companies) make recovery impossible.
Look at airlines. The zombie (USAir) drives the others out of business. CONgress’s post 9-11 $20B to USAir was the worst $20B they ever spent, with the possible exception of the B-2 Bomber. The most advanced plane in the skies, just don’t get it wet.
“Now that America has stopped spending, Chinese factories have closed.”
Is it time to unload all that wheat and rice I bought last March?
In my world, you gotta eat it before you “unload it”.
Almost spewed water all over the monitor.
I’d hold onto it if I were you. Shortages come next.
I’ve been eating all my food that is about to expire.
I’m getting sick of cornflakes and rice.
I enjoy the stale potatoe chips but some crap has to get tossed!
Feed it to your chickens.
Warren Buffett has now lost half his fortune in a year and is in danger of reneging on his gift promises to Gates. BRKA continues to be overvalued by 30% as investors live in the past and refuse to accept the truth that he runs a poorly-performing fund of funds trading at a huge premium to NAV. But he got what he wanted – an administration that will end up nationalizing aggregate demand and rendering most equities valueless. Eternal optimism can be a great wealth destroyer, and is probably not even a good religious strategy. It’s not inconceivable that Buffett will die broke, rounding to the nearest billion. His and Gates’s grandiose charity are quite likely going to end up as little more than a shell.
Meanwhile, my outlier prediction of three months ago that Obama would end up declaring a state of emergency in his first 100 days (i.e., by May 1) is not looking so extreme.
“It’s not inconceivable that Buffett will die broke, rounding to the nearest billion. His and Gates’s grandiose charity are quite likely going to end up as little more than a shell.”
It’s a shame if folks with that kind of wealth burn the chair legs out from under their massive charity gifts, rather than setting up sustainable endowments (assuming they fund worthwhile causes).
There is no bottom. When Prechter says take the shorts off, that implies the ultimate contrarian indicator……
Markets crash when they are oversold, throw in illiquid, and you got the makins fer a downright dangerous drop.
10 times earnings at 42.50 has me thinking that S&P450…. 50 aint gonna make it.
the plane has crashed…its all about the survivors.
C’mon vozzie! Give it to us straight. We can take it!
“Markets crash when they are oversold, throw in illiquid, and you got the makins fer a downright dangerous drop.”
Sounds a bit like running a car after the engine threw a rod and the mechanic forgot to properly close the oil drain…
P.S. Didn’t we already have a dangerous drop, or was that just the warmup act?
-
warmth of spring
defining complex things
buy, dont eat it
-
Residents of upper Richistan are about to lose two sacrosanct tax deductions at once! Buh buh, Jumbo loans (who would want to take a mortgage on a $1m home if there were no mortgage deduction to provide incentives to do so?); buh buh McMansion…
Wall Street Journal
* FEBRUARY 26, 2009
$318 Billion Tax Hit Proposed
Upper-Income Americans Would See Deductions Cut on Charity and Mortgage Interest
…
The tax increases would raise an estimated $318 billion over 10 years by reducing the value of such longstanding deductions as mortgage interest and charitable contributions for people in the highest tax brackets. Households paying income taxes at the 33% and 35% rates can currently claim deductions at those rates. Under the Obama proposal, they could deduct only 28% of the value of those payments.
I disagree with FunYun — reducing the mortgage deduction could hasten the onset of the next up cycle in housing by bringing prices down to affordable levels more quickly. The mortgage deduction is one of many subsidies which helps explain how home prices became so unaffordable.
Wall Street Journal
* FEBRUARY 26, 2009, 9:18 P.M. ET
Mortgage Deduction Looks Less Sacred
By NICK TIMIRAOS
The president’s budget takes on what has long been considered a sacred cow by trying to reduce the mortgage-interest tax deduction for top earners.
The president’s budget seeks to raise $318 billion over the next decade by lowering the value of itemized tax deductions for the wealthy — including interest paid on home mortgages. Households that currently pay income taxes at the 33% and 35% rates would only be able to claim deductions at the 28% rate. That means that for every $1,000 in deductions, a household in the top tax bracket would realize a tax savings of $280, down from the current $350. The proposal wouldn’t take effect until 2011.
President Obama faces an uphill battle as he proposes changes to the value of tax deductions, especially the home mortgage interest deduction. Hear Journal reporter Nick Timiraos explain how this deduction works, what the changes will be and why this is such a significant move.
The mortgage-interest deduction for owner-occupied homes is estimated to cost the government $100 billion this year, making it the largest government subsidy for housing and one of the most expensive tax deductions.
The real-estate industry, which has long squelched efforts to tamper with the mortgage-interest deduction, warned Thursday that any rollback could undermine an already decimated housing market. “It’s an awful policy to recommend at this time,” said Lawrence Yun, chief economist for the National Association of Realtors. “The source of economic problems is falling home prices, and this proposal raises additional uncertainty” about where and when prices would set a floor, he said.
“The mortgage-interest deduction for owner-occupied homes is estimated to cost the government $100 billion this year, making it the largest government subsidy for housing and one of the most expensive tax deductions.”
At least it is lots cheaper than the TARP or stimulus.
Does anyone know what share of the mortgage deduction goes to wealthy people who could buy a home w/o a mortgage, but take out a mortgage anyway for the tax deduction?
I am guessing it’s a large share.
Didn’t Europe eliminate the mortgate-interest deduction years ago?
Okay let’s try this again with the correct spelling:
Didn’t Europe eliminate the mortgage interest deduction years ago?
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many days ago
Vulcan fire, not know
Europe snow
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According to nhz the entirety of the mortgage payment is tax deductible in Holland, not just the interest.
voz,
Thank you for the link to the Vulcan god.
Netherlands is an exception in Europe, but there are a few other EU countries with home mortgage deductions, although far less favorable than in Netherlands. Some EU countries eliminated HM\d completely (e.g. UK and one of the Scandinavian countries).
In Netherlands you can deduct the full mortgage payment and all other costs associated with buying/owning a home, except for the standard upkeep cost. So the Dutch deduction includes stuff like closing and realtor costs, all home improvements (including new garage, pool, garden etc.). The income tax bracket is 42 or 51%, in reality most homeowners are in the 51% bracket. So effectively the government pays 50% of every home. Income tax is by far the biggest tax in Netherlands. Gains from selling a home are tax free (no caps at all).
There is some talk about capping the HMD, but this is unlikely to happen due to very strong political opposition. Homeowners are a (small) majority, and our government is completely owned by the building mob and wealthy farmers. None of the bigger parties dares to go against them, despite the fact that 70% of the Dutch would welcome changes (like caps) to HMD.
One proposal that surfaces from time to time is introducing a flat tax and removing the HMD (and many other deductions for high income earners) at the same time. In this case the income tax could go from 42-51% to a little over 20%!
The biggest problem with the mortgage interest deduction, IMO, is that it creates a McMansion subsidy — that is, people are incentivized to buy “the largest house they can afford” in order to capture a bigger tax deduction. I am hoping that Toll Bros goes belly up shortly after they shut down this tax giveaway to the rich; killing two birds with one stone would be sweet.
yes, that’s what happens in Netherlands. It encourages people to buy the most expensive home, take on the maximum debt (either spend it on the home, or give the money to the tax office). Studies have shown that by far the biggest chunk of the Dutch HMD ends up with the highest income earners - because these people take out the really big mortgages.
And of course Dutch homeprices show that the official objective of the HMD of providing ‘affordable housing’ has produced exactly the reverse outcome, like many brilliant government interventions (probably exactly like it works in the US).
Grim news.
Does that mean no more 10k gift per child?
Its at least 11 or 12k now. And not just per child, you can give a tax free gift under that limit to as many people as you want per year.
I confess I like several elements of OBwan’s housing plan (esp. the mortgage deduction reduction and the antifraud earmark).
Wall Street Journal
* FEBRUARY 26, 2009, 3:31 P.M. ET
Obama Budget Plan Boosts Resources to Combat Mortgage Fraud
By JESSICA HOLZER
WASHINGTON — The Federal Bureau of Investigation and the Department of Housing and Urban Development would get more funds to crack down on mortgage fraud under the fiscal year 2010 budget.
The budget would also boost funding to HUD to promote affordable housing, a key Democratic priority.
The proposed funding comes as evidence mounts that mortgage fraud is on the rise, and scrutiny of illegal or predatory practices intensifies in response to the housing-market crisis.
The number of suspicious activity reports filed by financial institutions related to suspected mortgage fraud increased 44% in the 12 months ended June 2008 compared with the prior year, the Financial Crimes Enforcement Network, a Treasury Department unit, said this week.
I have the growing suspicion that despite the “save our homes” price support rhetoric in the stimulus package, the Obama economics team would be happy to have the housing price correction quickly bottom out at affordable levels. How else can one explain dual proposals to eliminate mortgage fraud and sharply reduce the mortgage interest deduction — both key factors behind the bubble runup in home prices — on the same day?
These factors coupled with a bad recession plus Alt-A and prime ARM resets are likely to cause the top end of the market to capitulate, and the effect will be akin to the collapse of a third-world multistory home’s roof in a large earthquake: everything below will get flattened like a pancake. This would actually be a very good outcome for young families trying to get in to the market and (surprise!) for Realtors™ who need a flow of sales transactions to earn a living. Right now, unaffordable prices are keeping young families in rental housing and Realtors™ unable to make a living.
Funny how these companies were cash cows back in the day when they were privately held, but the minute the gubmint took them over, they started to bleed red like stuck pigs.
Wall Street Journal
* FEBRUARY 27, 2009
Red Ink Clouds Role of Fannie, Freddie
By JAMES R. HAGERTY and DAMIAN PALETTA
WASHINGTON — Red ink is starting to gush in even larger quantities at Fannie Mae and Freddie Mac, as the government wrestles with deciding what role should be played by the two biggest providers of funding for U.S. home mortgages.
Fannie late Thursday reported a $25.2 billion loss for the fourth quarter, and Freddie is expected to report a huge loss for the latest quarter when it posts earnings, probably in early March. Homeowner defaults have continued to increase even as the government has redirected the two companies to focus their attention on preventing foreclosures and propping up the housing market. Gone are worries about pleasing shareholders, whose stock has crashed to about 50 cents a share at both firms.
Fannie’s loss was caused by mortgage defaults and drops in the value of derivative contracts used to hedge against interest-rate risks. For the full year, Fannie had a loss of $58.7 billion, compared with a year-earlier loss of $2.1 billion. The loss for 2008 exceeds net income for the preceding 17 years.
The company said it expects that the housing and financial-market conditions that led to 2008’s huge losses “to continue and possibly worsen in 2009.”