The Housing Bubble

I don’t know DinOR. Lots of HELOC money involved in housing went to stocks. That cushion is gone now. Also suspect lots of people still cashing out the 401K.

Think the boomers are also starting what should be an accelerating withdrawal too.

James,

Not sure either. It was just my experience that most people that had enjoyed some measure of success in res. RE were many times more likely to continue to re-invest in same.

That was more of a 90’s thing where MSFT employees would borrow against their stock options and buy homes on Union Lake etc. With everyone taking 100k heloc’s and buying FIVE homes w/ 20k down each which asset class ’should’ have been more affected?

But their HELOC/cash-out money went to consumption, that drove up profits for those companies, which led to a rise in their stock prices.

All in all, trillions of dollars that were based on rising housing prices went into the economy. Capacity was reved-up to service this demand. All of this will have to shrink when that money is no longer available.

I doubt that. Profits are going in the toilet. Bills are not being paid. Orders are being cancelled. Workers are being idled. Transparency would flush this market.

It’s also more difficult than usual for people to pretend that they know what’s going to happen. It’s easy when times are good, everyone is an investing genius. But a lot of them have been very wrong about the future recently, and that lost feeling stays with them. They built up a way of understanding the world, “this is what you do with money to become wealthy,” and they were just completely wrong.

Yup.

I say let the Dow bleed slowly instead of letting it crash and be done with…stabilizing (i.e. bottoming) sooner so that we can all take our licks and move on.

So you think the lack of transparency is a good thing? If that’s the case, then you should also be arguing that the Wall Street bailouts are justified because they are also saving the stock market from falling quickly to its equilibrium level.

I say let’s NOT let the Dow bleed slowly, but take our licks now and move on…

sorry, mistyped

You need to look on the NJ side of the Philly burbs. There are lots of homes that are <100/sq/ft in some of those areas (Pedricktown would be a good place to start a search) and tons of McMansions with little/no demand forthcoming. You might be able to get a huge house for not much money on the NJ side. The PA side has long been overpriced, IMHO.

eastcoaster -

I assume you’re talking asking prices as opposed to selling prices. Inventory is up, sales are down. What I am seeing in the Philly ‘burbs is asking prices at 2005 levels, but at least the 25% yoy price increases have gone away. I’ll say to you what others have said to me: “Patience.”

Housing prices everywhere are absolutely cratering. Sometimes, the median is skewed by higher priced homes selling, but a closer look at the PPSF for those particular properties reveals a market in a shambles. Housing is not propped up. I have posted before, that certain properties in Reno, NV are selling for at 1975 prices NOMINALLY.

“…for at…?” Wake up, Grizzly!

I wish some of that PLUNGE would arrive here in Maryland. People here are still delusional and Post War junk is still selling for 4x median household income - don’t even ask what a better house is selling for… and most people are still insane enough to believe the Bubble is coming back.

For example, just this weekend I heard sheeple explaining how the BRAC (Base Alignment and Closure) was going to somehow magically bring a zillion people to Maryland, all of whom will rush out and buy houses at 5x their income or more and keep housing prices the way they should be: high and unaffordable?! Insanity…

I’ve been fencesitting in the Philly burbs since early 2006. I’m astonished at the stubbornness of sellers insofar as their asking prices. Locally I’ve heard predictions of the stock market “skyrocketing” 2000 points in the near future, prognostications of a quick turnaround based on no discernible indicators.

I’m not seeing a big drop in restaurant attendance, if the place has good food and is not super expensive. Target has crowds similar to what they usually are on a weekend. I don’t know if the domino effect of layoffs has not occurred here as of yet. I have learned of more foreclosures and REOs than the local NAR is willing to admit. Driving around, the FOR SALE signs have begun their spring blooming season - definitely more inventory on the market than usual.
It’s going to come down to market fundamentals, eventually, even here. Too much inventory equals pressure on prices to come down.

But I agree with eastcoaster and Mikey2, the Philly burbs are really sticky on the way down. Prices, anyway.
(Today we’re snowy more than it is sticky.)

Grizz… it is true that there are some old condos in Reno that are selling for those prices; however, they are in gang infested areas. Most decent Reno real estate is still too way too high with thousands of foreclosures yet to come.

Yeah, eastcoaster, those developments that took off near the end of the Atlantic City Expressway are inhabited by workers who trek both to Philly and AC. I think there was lots of creative financing that put many of them in those places and the “honeymoon” rates on those products are due soon to jump. Look ’round the Williamstown area (Exit 38 off X-way). I think there are plenty of nervous FBs ’round there.

Things still look somewhat normal in Norfolk / Virginia Beach. People are still asking high amounts for homes (2400sqft vinyl wrapped = $400K+ wishing). Salaries are still stagnant. There are some layoffs, but not a huge amount. Many jobs are gov’t. Military pays out a pretty high housing allowance which messes with the market (just went up, again). Lots of places for rent though, still asking high prices.

SBUX? I’m sitting in a packed one right now. As people retrench, a $3 latte is an affordable indulgence as compared to say, jet skis or RVs.

You might be right, but it will be indulgence, rather than everyday necessity. Fewer and fewer people will have the means for indulgences of any kind, so SBUX needs to remake its business model in accordance with shrinking customer base.

The problem with malinvestments is that there is no way to separate the baby from the bath water. The baby has adapted to its environment, when that environment changes over night the baby cannot adapt fast enough.

The baby that they are throwing out is the free market… they are killing the goose hoping to get all the golden eggs inside and then distribute an unlimited supply of golden eggs to everyone so we will all be rich.

Unfortunately, people think that consuming more eggs will cause them to be produced faster… they never realize if they consume all the eggs it will not be long until the last generation of chickens is too old to keep laying. There is a major “nest” egg shortage and no one in government wants to “save” an egg to produce another chicken. Instead they raid every nest they can find to spur more egg consumption…

McD’s here is offering free lattes to get the public to try theirs, so how long for SBUX? I mean, SBUX never could get breakfast right. Mocha and an egg mcmuffin? Mm mm good. (Oops, that’s YUM brands.)

VA Dan, it’s more like they are trying to extract the eggs from a dying goose in the hope that the eggs will hatch to make more geese.

Neither eggs nor goose is golden.

you are lucky. I am still hearing it.

My wife is convinced that local Houston prices in our Clear Lake area zip code are climbing. I tried to show her zillow but they also show prices somewhat up over the last few months, darn.

Her real source of information is her intuition, mainly due to the houses in the next subdivision over being 100K more than the houses here, and strangely, there are several for sale. She doesn’t seem to feel that price differential is warranted, no matter how newer or nicer they are.

Authoritarianism, under a messiah-like leader offering vague promises while raising taxes to confiscatory levels and redistributing wealth, maybe?

Yeah, I’d rather prefer the kind of authoritarianism where a messiah-like leader gets us into wars based on vague intelligence data, lowers taxes on corporations that move jobs offshore, and redistributes wealth from taxpayers to banks and insurance companies paying insane bonuses to their CEOs.

(rolls eyes…)

Bush and Obama are members of the same political party. It’s called statism. Whether we bankrupt ourselves on wars, bailing out crooked bankers or paying for riff raff on welfare, the result is the same.

The other team crashed the car. We’re going to try thoughtful planning and an equitable division of our nation’s spoils for a while. Get over it.

So how do you measure equitable?
Or do you mean equal?

Thoughtful planning, yup. Obama is going to replace the fake wealth of bonuses, cooked books, pricing scams, currency scams, foreign dependence, false patriotism, corruption, unsustainable profits, outsourcing, insourcing, mortgage cash-outs, credit card debt, “services,” back-door deals, and our Potemkin Village of a media with the REAL wealth of an educated, healthy, productive, innovative, and honest populace which produces valuable goods and services again, and doesn’t NEED to sweep half its transactions under the rug.

As I said yesterday, if you don’t like the tax increases, by all means, pay taxes according to the rates under Saint Ronald Reagan. Or move to a friendly locale like Somalia, where nobody is collecting any taxes at all.

“Bush and Obama are members of the same political party. It’s called statism.”

Nicely put, LAIG.

Yeah, Obama is going to use the REAL wealth of an educated, healthy, productive, innovative and honest populace, by taxing it and squandering it on all the welfare spending contained in his stimulus package, which is basically a transfer of wealth from the productive to the unproductive members of society.

I see the kind of human garbage that collects the Seccion Ocho benefits that his “stimulus” expands, because I’ve had the experience of renting to them. If you could see who your tax money is going to, money that could otherwise to circulate to private enterprise, you’d understand why things are only going to get worse.

Or, Fascism, a.k.a. Corporatism.

Interesting - that sounds a lot like the limousine liberals sprinkled all over the SF Bay Area.

Some of them are my friends.

When they all used to say “we all need to pay more taxes”, I would ask them if they sent an extra check themselves to the Treasury every April (or every quarter, depending on circumstances).

Following that query all I ever got was silence.

Anyone who wants to pay more than they’re obligated to in taxes is free to do so.

I suppose the next question is… does anyone do that?

and honest populace

You think BO is gonna make the populace turn honest? Don’t you think you’re setting yourself up for disappointment?

People are only kidding when they call him the Messiah…

lmao!!!! Authoritarism, the real intent of current day, get in line, march in lockstep “conservatives” is being tossed at BO….. by a “conservative”.

It doesn’t get any better than that.

taxing it and squandering it on all the welfare spending contained in his stimulus package, which is basically a transfer of wealth from the productive to the unproductive members of society.

I see the kind of human garbage that collects the Seccion Ocho benefits that his “stimulus” expands

Speak of the devil. Just yesterday I was trying to explain The Romance of the Bootstrap to a pen pal in Norway, and here is another example of it. At this point I give up, because there is no reasoning with it, except to say that I am surprised that only 5% of the Americans workers are productive.

oxide:

Wait till the spoils of ripping off the 250K+ crowd are deemed insufficient to pay for Obama’s big social spending plans, and he has to tap into the “wealthy” making 200K, then 150K…How long until those making 100K are the “wealthy” who need to be fleeced in the name of redistribution and social “justice”? 75K? Where does this stop?

Wait, wait, wait, LAIG–

welfare for riff-raff?

I thought you rented to Section 8 tenants. Is not Uncle Sam paying most of their rent?

Would you support eliminating HUD first?

Ultimately, like the old Soviet Union, there will be just two classes: the ruling class and everyone else.

Time for everyone to watch, or re-watch, the movie “Doctor Zhivago.”

It stops just before you hit the median income of a voting adult. So if the median income of a voting adult is 50K, and you define “rich” as those making over 75K, you’ll still be fine. Once those below the median realize that they can vote an unending series of higher taxes on those above the median, we are going to have a big problem!

“I see the kind of human garbage that collects the Seccion Ocho benefits …”

+1 Great perspective, LAIG. Wish more ladies were as sharp!

If you take money from the wealthy and give it to the poor, does it speed up the velocity at which money is spent? Thus creating more profits for the companies the poor are doing business with?

It always seems like in my area the profitable businesses are the ones that sell chrome rims and paycheck cash advances.

I see LAIG posts and runs. No answer as of 7pm eastern time!

Vabeyatch–both businesses epitomize the worst kind of rapacity. This is where paternalism comes in. Some people are poor b/c of their behavior. Unfortunately, they have kids, who, left to be neglected by their feckless parents, may become tomorrow’s criminals. Hence, the programs to give these poor people the things they need w/o giving them cash, which they use to put themselves in hock again. Not defending it, now.

I do think a little nanny-state might make sense, though. Eliminate the “legal loan sharks” through regulation. Most ppl think twice about taking a loan from loan shark or bookie. Not having Payday Cash or “tax refund loans” or other crap like that available *might* keep some people from being exploited. (At least with a pawnshop, if you can’t pay it back, all you’re out is some piece of stuff, not your entire future.)

“Wait, wait, wait, LAIG–welfare for riff-raff?..I thought you rented to Section 8 tenants.”

Good point Gator…

“Whether we bankrupt ourselves on wars, bailing out crooked bankers or paying for riff raff on welfare, the result is the same.”

LAIG

(1.) Labeling welfare recipients as “riff-raff” and your own tenants as “human garbage” is weak and quite revealing in respect to your character. (I was on welfare as a kid being raised by a single parent).

(2.) If you compare the expenditure #’s on welfare over many years compared to the trillions squandered on Iraq, hoarded by big finance scumbags and bailouts, it’d be quite skewed IMO.

DOC

I have no problem with her running. The racism of her “human garbage” and “Section Ocho” remarks only reduces the level of discourse here.

“Time for everyone to watch, or re-watch, the movie “Doctor Zhivago.””

I prefer “I Dream of Genie”:

Visiting Cosmonaut: You live here, one family in all this space? I always heard of wealth of America, but did not believe it!

..later, after a “dinner” in a TV tin and half an apple…

Now I see how afford house… you can’t afford food! You need borrow rubles? I give! I go now. To a restaurant!

Speaking of “posting and running”. …if I was more pc savvy, I would love to figure out responses to posts, but until I figure out that skill-anyone want to eeemail me with answer to query? ellisisland123ATyahooDotCom. Still trying to learn.Thanks.

WT Economist,

Paid off home or not, I don’t think any of us can afford to ‘that’ dismissive about what’s taking place? Unless you also own acres of producing greenhouses and your own well with a generator..?

Most of us are not so fortunate to have a house paid off, but I do own 1/4 of a paid off house in the UK, which makes me quite lucky compared to most.

My question is do we favor deflation, in which senario most debts held privately and publicly are not repaid, or do we favor inflation in which most debts are repaid, but with devalued dollars?

If inflation is akin to boiling to death, deflation is akin to freezing to death. As things stand, I side with the deflationists and believe our economy will continue to collapse as debts - worldwide are no longer honored at an ever increasing rate and jobs are lost even faster - driving more defaults and so on.

In either case, it is time to declare all debt void and start all over. Does this reward those who spent and got all the goodies while those of us who were responsible sat it out? Sure, but the time to stop that was when it was happening. Closing the barn gate now will not help.

It seems WT made choices that reflected a belief that something like this could happen someday. He’s not the only one.

In the past decade everyone made choices, some chose to believe that trees grew to the sky and some did not.

Actually, I just made the common sense choice to pay off my mortgage like people used to do. It was never a choice, because I never considered doing otherwise.

I’m amazed at what other people did. Did they make choices, or did they just get carried along?

That paid-off house may be cold comfort if they raise property taxes to confiscatory levels.

Whatever their case, the “carried along” defense gains no traction with me.

It was astounding that folks with little working knowledge of very basic historical and financial concepts came to amass such debt. And by basic concepts I mean:

1. Recession/unemployment happens - to EVERYONE at some point.
2. Don’t spend more than you have.

Hardly rocket science, sorcery, or vodoo.

I don’t think any of us can afford to ‘that’ dismissive

What’s he supposed to do, sh!t a brick? No point in panicking or screaming bloody murder or otherwise losing one’s composure now.

the “carried along” defense gains no traction with me.

That’s all well and good for early and late Boomers who made the choice to be blessed with a stable job and a home at a reasonable price before the insanity hit. However, what about us Gen Xers who are not yet established? I *will* be carried along. However, I count myself lucky in that I can use my house down payment as my life-preserver. I’ll get there eventually, just a few years later. Hopefully.

Income: twenty pounds, expenses, nineteen-and-six, result: happiness.

Income: twenty pounds, expenses, twenty ought six, result: MISERY.

For sure.
Rocket science, high finance banking and house buying all require at least some fundlemental knowledge of the BASIC Mathematics, without such, even the village idiot could could look at the project and correctly sumize that…. this damned thing AIN’T GONNA FLY !

But oxide, I am Gen X too and have actively resisted the “boomer” defined economy at all turns. If anyone got carried away in this it was the “boomers”*.

Disclaimer: use of the term “boomer” is not meant to start an intergenerational spat. I’ll trust that folks will see how that term is being used here.

Sorry, Edge. I used to term “boomer” because it’s not enough to be responsible; you have to be responsible for a couple decades. Only boomers are old enough to pay off the house (traditional mort). Even if I chose the same uphill path as a responsible boomer did 15-20 years ago, I simply haven’t traveled far enough to reach the high ground and avoid the flood (to use a metaphor).

I don’t have any sympathy for irresponsible boomers either.

oxide,

There’s more wisdom in what you’ve shared than you’ll perhaps -ever- know! I was thinking about that a LOT over the weekend.

After years of military service ( and crew cuts ) when do “I” get to be an irresponsible FLAKE! After years of commuting downtown and paying dues, when do “I” have the luxury of saying “My decisions may affect others in a negative way but in the end, they are… MY decisions!”

Well, those of us born long after the boomer throngs ( but too old to be associated w/ younger generations ) I fear the answer is, we’ll -never- have that kind of latitude?

“I don’t have any sympathy for irresponsible boomers either.”

I don’t have any sympathy for irresponsible people of any age, race, gender, religion, or sexual preference.

Your argument about the mortgage is specious. What is preventing you from making the Bohemian down payment (as they used to say in Chicago)–cash?

Our rent is 15% of income; we will easily be able to buy with cash in a few years. Listening to Dave Ramsey, it is clear we are not the only young people able to do this.

Even my grandmother, who grew up in privilege, rented a small flat in the early years of her marriage. No shame in that.

DinOR,

Birth-Dearthers won’t get that kind of latitude, ever.

The boomers will suck up our work money now, AND compete with us for available job promotions.
Then, just when they’re about to retire, they all stay at work a couple extra years, still denying us the promotions.
When the baby boomers finally clear out, we will be passed over for good jobs by Millenials, because they are more tech-savvy (and never had to contend with the dark days when computers were moving so fast that they were all incompatible with each other — who remembers bug-laden Windows 95, Zip Drives, and the ever-crashing Apple OS 9?)
Then, when (if) we finally retire, we’ll have the comfort of knowing that SS for the few of us will be supported by a lot of working Millenials. But by then, we’ll be such a small voting bloc that politicans will ignore us anyway.

Can’t wait.

not a gator, to whom do you address your comment?

Yikes, this anti-boomer stuff is so lame. Anybody here REALLY want to live the way you had to during the 50s and before? How can ya blame a generation for breaking out of that jail? The concept of living alone and not being messed with hardly existed before then. Whatever job or financial problems the Xers and Yers have … maybe they’re visible somewhere in the old mirror. The changing of the guard is on right now, anyway, I see it in my office … as a late boomer, I’m fine with letting you folks have the promotions and the headaches now! You go be a hero!

“as a late boomer, I’m fine with letting you folks have the promotions and the headaches now! You go be a hero!”

Amen to that. I enjoy working, but I won’t go back to 75 hour weeks, I won’t go back to several hours of commuting in heavy traffic, I won’t go back to being everybody’s solution for everything.

I will never work in a cubicle again, ever.

I will go back to the 50s, with a fishing pole, and let the eager beavers take a run at the hill.

They won’t get far looking back down at me.

HAHAHAHAHAHAHAHHHHHHHHH!

“who remembers bug-laden Windows 95, Zip Drives”

HEY….I still use a zip drive. ..harrumphh!

Ah, oxide, your ears are burning.

Yes, I meant you. Don’t tell me about how you would need another 15-20 years for “traction”. That’s silly.

It’s best to live like a grad student when you’re young, rather than start spending right away and end up living like a grad student when you’re old. Because your body can’t take that s— anymore when you’re old. This I have learned from my coworkers and passengers.

I know, I know. I’m a big blunt meany-pants.

not a gator,

I DID live like a grad student when I was young. I WAS a grad student — until I was 29! I wasted the most energetic years of my life making essentially minimum wage so I could get a good education and get ahead, while everyone else was prospering from the good times under Clinton. Then I had to establish an emergency fund, then pay off my college loans, then start a 401K. My vacations consisted of a ticket in luxurious Coach Class to visit my family once a year. Then this insanity hit, and prices were far out of my reach before I could put a down payment together. Up until a couple years ago, I couldn’t even afford a car, much less a Bohemian down payment.

I guess I just didn’t “work hard enough.” I give up.

As someone who is just out of the ss loop by 2 yrs, and is to old to make it all up like a 20+ yr old, and watching my co-workers work till they are in their mid to late 60s now, thereby keeping me from getting a better schedule and vacation month etc..It ain’t gonna be pretty on any account.

Unless, we all move to FL with 40K houses. Or PA. Who was our friend who moved to PA? He was adorable and we never hear from him anymore. Do they have internets in Oil City PA?

Nonsense. What we need is more nail salons, candle shops, realtors, mortgage brokers, and WS paper shufflers. We are a service based industry now.

industry = economy

“And we need to get rid of these monster megalith corporations that do little besides lobby and litigate and siphon resources from the rest of us.”

BINGO. And in a very big way. Perp walks for the top 500 managers/execs.

Yeah, let’s have more realtors, mortgage brokers and Wall Streeters - they are the “producers” in our society. The trouble is, what these people “produce” is scams designed to separate suckers from their money. We need to raise their maximum tax rates back to the 70% pre-Reagan level.

“We need to raise their maximum tax rates back to the 70% pre-Reagan level.”

Amen Bob.

I wonder if you could set up a tax structure so as not to punish entertainers like actors and athletes. Remember, Reagan pushed to lower those marginal rates because those in “feast or famine” professions, like actors, would take a huge tax hit one year and then have no income the next, which seemed unfair while Mr. Banker paid less tax and had a steady income every year.

If actors and ball players could take their income as some sort of annuity, however, then they could be taxed on whatever whatever rate on realized income, but still have something coming in after the injury or the sex scandal or whatever it is that puts them out of commission when they’re no longer “hot”.

It would be a fixed annuity for a fixed number of years. If the actor continues to make multimillions year after year eventually these will pile up and realized income will increase, hence taxes. But if this doesn’t occur, and income is hit or miss, this person will not end up giving 50% to Uncle Sam for two years and then be on welfare two years later.

And this wouldn’t be insurance against making stupid financial decisions … that can still happen. Gives us peons something to laugh at.

Reagan also got rid of income averaging (although still available to corporations).

I can do better than that. How about every adult over 18 pays the same DOLLAR amount in annual taxes?

Unfair, you say? Let me ask you this. Isn’t every citizen supposed to be equal in the eyes of the law? Isn’t each person supposed to get the same police protection, the same access to the courts, the roads, the public parks?

Then why should one taxpayer one amount, and a different taxpayer a different amount, for the same services? How is it the government’s business how much you make or what your property is worth?

“I can do better than that. How about every adult over 18 pays the same DOLLAR amount in annual taxes?

Unfair, you say? Let me ask you this. Isn’t every citizen supposed to be equal in the eyes of the law?”

Equal? Great idea. And everyone get the same pay, correct?

Do you really not understand the concept of equality before the law as opposed to equality of income/abilities/property? What do you think “all men are created equal” means?

Its your idea LVG. Don’t backpedal from it.

Just listen to the folks who have no children, will never have any children and truly resent their taxes going to support schools.

Life is just so unfair sometimes…………..:-)

Speaking of FROGS, I know that no one was, but ‘Frog’s’ handle reminded me to tell Oly Gal that the frogs around the golf course tonight are really really loud and I thought of you while I was walking.. Do frogs really taste like chicken,Oly?

I disagree. Each of us is responsible for what happened. Who was out complaining while our house prices climbed out of control to the sky? Who cared our jobs were offshored as long as we could buy cheap TV’s? Who complained while our 401K’s ascended at 20% a year?

Why were we not marching outside of our Senators offices demanding Option, Interest only and no doc loans, derivitives, credit default swaps, credit default insurance and the practice of bundling garbage paper as AAA rated gold by our credit raters be banned and that something be done to protect our jobs at home? Because we were all making a load of money is why!

What I am putting out there right now, is the simple idea that it does not matter who’s fault it is, but that right or wrong, fault or no fault we are all in this together. Perhaps we don’t care if we show up at the grocery store next year to find a long line of people waiting for a loaf of bread and a quart of milk. Why should we after all it’s not our fault right? So do we just do nothing and allow the economy to collapse in it’s entirity or is there something smart thinking people like us can come up with that may allow us to ge through this without losing everything?

GH,

Reluctantly… I’ll have to agree. Yet I don’t know what purpose it would’ve served to have thrown a Tea Party in 2005? Raising a stink about the rickety derivatives sprouting up like mushrooms probably wouldn’t have gained much traction?

What we ‘could’ have focused on was realtor and mortgage broker ETHICS! That was something that was tangible and it’s a complaint that ’should’ have been heard.

Do you honestly think spending the last 4+ years posting on this blog is b/c I did not care about the outcome of a housing bubble collapse — that I did not care about my community? Are you out of your mind?

How am I responsible for this mess, when I’ve been labeled Chicken Little for warning about Armageddon and the day of Apocalyptic Reckoning?

Maybe you haven’t been paying attention, but most of the attempts to fix this mess have so far made it worse. Slashing interest rates to prop-up home prices and bank balance sheets created a commodity spike that drove the global economy off a cliff. Time after time, we’re ignored.

“Who was out complaining while our house prices climbed out of control to the sky?”

*I* was! And my neighbors in 94087 thought I was nuts when I said I wish house prices would drop! After all, we had our houses, so bubbled prices were good, right?

Don’t give me that line about “who was complaining years ago” as if we all rode the MEW wagon and now feel bad about it. I’ve complained for years, I’ve written letters to Senators and Congressman, I’ve voted accordingly, and I’ve not over-consumed nor have I tried to support the off-shoring of our jobs.

And do you know what it got me? Absolutely nothing. Nobody listened, save for the rest of us “whackos” on forums like this one. The missing jobs didn’t return, our leaders continued to encourage overspending and outsourcing, and so on.

So, no, I am NOT responsible for this mess, and I’m not going to clean it up, either.

I threw a tea-party back in 2005. I quit my job and fixed up my way-over-bubbled stucco box in San Jose for sale, prior to moving to a cheaper place to live. Almost everyone I knew thought I was over-reacting.

I do feel some pangs of guilt about selling that place at that price to the poor FB. But it’s not like I held a gun to his head. He even offered thousands of dollars over my asking price.

“Why were we not marching outside of our Senators offices demanding Option, Interest only and no doc loans, derivitives, credit default swaps, credit default insurance and the practice of bundling garbage paper as AAA rated gold by our credit raters be banned and that something be done to protect our jobs at home? Because we were all making a load of money is why!”

Ummm, No.

We weren’t marching because we were too f’ing tired after our working 40 hours week-in, week-out. And sure as s**t not making a ton of money.

Anyway, I suspect there were a hell of a lot of smart folks railing warnings at PTB and the MSM to no avail…as they’re both on the finance scumbag’s payrolls.

DOC

I think the people here are the only ration ones I know. Other than my criminal defendants, y’all are the only people who don’t ALWAYS lie.

Like Pondering said, many of us **were** writing letters, calling representatives, trying to report suspicious transactions to the FBI, warning local officials about the coming downturn (so they would save the money made during the good times), etc. I did.

The act of posting on this blog alone means that we were making this information public. Everyone out there had the same opportunities we had to educate themselves. We owe Ben a debt of gratitude for this blog. Many of us did our part in trying to warn people. We were totally ignored and/or belittled for our beliefs. There is no reason for us to be in favor of helping those who got us into this mess. Let them burn.

There is only one way to *fix* things and that is to produce things. There is only one way to know what to produce and in what quantities, free-market prices.

So what are the “Band-Aids”? Price fixing and increased consumption. For those who see Obama as “slowly tearing the Band-Aid off” you need to understand that what he is doing is destroying the capital we need to start producing what is really needed… food, cheap housing, cheap transportation, and energy.

The price system is so screwed up by all of this money printing / monetary destruction that producers have a hard time knowing what to produce.

Serious wage deflation is happening as we speak.

BF works at Boeing, new guys are coming in at 25% under his starting rate - and they’re UNION.

PTB have planned this well. How many currently laid off workers are going to squawk when they’re offered salaries 25-50% less than what they made before the Great Delevering?

“BF works at Boeing, new guys are coming in at 25% under his starting rate - and they’re UNION.

PTB have planned this well. How many currently laid off workers are going to squawk when they’re offered salaries 25-50% less than what they made before the Great Delevering?”

I’m humming “Revolution” by the Beatles.

Financial engineering always struck me as whatever-Asimov-called-it. Somewhere in his papers is the unpublished book where the system finally didn’t work and everything went to hell.

Could it even be shorted? There HAS to be a counterparty…

This is what the gubmints of the world are hoping for.

http://www.professorsplash.com

The video is classic.

Why is 45° any better than 90°? In both cases, the economy is dead. I’d rather have a quick and relatively painless death than slow death by torture.

Obviously of course the metaphor doesn’t quite apply, since we won’t all actually be dead, and *some* kind of economy will emerge from this mess. I would much rather have it be economy that properly accounts for risk by not counting on government bailouts than otherwise.

90° implies a Mad Max economy.

Which is exactly what we had in the 1770’s America - complete with hyperinflation. I’d say that turned out pretty well, wouldn’t you?

Not to mention the CSA in the 1860’s.

The government “picks up the tab” by raising unemployment insurance rates that all (other) businesses pay…. They are simply doling out the paid in premiums, and maybe, in times like these fronting some cash. I am sure they will get it back. You have an “experience” component to your rate based on past layoffs and amounts paid. That will go up as noted, but every businesses base rate, whether they have layoffs or not will also rise dramatically to cover these benefits.

Blue fairies are just figments of your imagination. Candy Crapping Unicorns on the other hand…

The 90 day notice is a Federal thing…went into effect about 6 years ago.

I don’t think it’s a federal thing. I work for a corporation in NJ that gives 60 day notice. I know it depends on the amount of employees that are being let go, but I’m not sure what the parameters are.

Umm…the easy way out of this of course is to give all employees notice every month that they might be subject to layoffs and just get rid of the ones you need when you need.

Keepin’ up the struggle. And you?

Yeah, shortwave radio is the issue here.

Perhaps you should re-read the post I quoted.

The party of Dick Nixon, Barry Goldwater, Ralph Reed and who-am-I-forgetting?, positioning itself as the counter-culture. An interesting thought.

Counter to what, though?

Oh, right, Uberkommander Limbaugh has declared that failure is victory.

Yawn.

King heck. They have already found their snow Queen.

I just wish the pendulum would settle in the middle. We’re swinging from a complete idiot on the GOP side to a complete idiot (although a mo’ better orator) on the Dem side. Then again there is that saying about nothing being in the middle of the road but white lines and dead possums.

I’ve always despised socialism - my grandmother endured WWII and 6 years of communism before my father bought her way out of Eastern Europe in 1951. I still remember her horror stories of continuous poverty and deprivation after all these years.

But after watching the “free-market” antics of Bush & Co. over the last 8 years, I’ve concluded that socialism for the masses is a far better deal than socialism for the rich.

People!
Educate yourselves before you spout. Some of you are beginning to sound like the “Reefer Madness” guy.

Socialism. Communism. Totalitarianism.

Different systems. Defined by words which have largely lost their meaning due to repeated, mindless demagoguery.

The United STATES have had NATIONALIZED roadways, medicine, pensions, schools, libraries, fire departments, prisons, parks, etc. for decades if not centuries. That is called “socialism.” Churches are by definition communistic. The military is totalitarian.
Would anyone seriously argue that today’s “socialized” Sweden is the same as 1950’s “socialized” USSR? That Great Britain’s public health service makes that country totalitarian and its physicians less motivated or capable? Or that Guangzhou’s rampant free-market capitalism is/was anything like America’s nominally “free” market system?

Americans live and work with varied social systems every day and the nation has not (yet) come to an end…although the game most definitely appears to be over. (Somebody apparently “won” the old one. Hint: It wasn’t you or me. )

If we want to keep playing, interacting, having fun, we’ll have to clear the board, re-state the rules, distribute the monopoly money to all players, and start a new game. What we end up calling it remains to be seen….
Pax.

Well said.

It looks like the redistribution will be involuntary, and not necessarily in the way the Pigmen imagine. And it looks like the petty bourgeois are the first to be wiped out.

Excellent post, ahansen!!!

ditto, very insightful

IMHO the new lines in the sand are the Ron Paul supporters vs. the TARP/bailout set.

Moderates cannot be in power, and therefore cannot lead. The country is designed to whipsaw between loonies on the left & right. It makes sure joe6pack has plenty to whine about and always has someone to point a finger at while he is being ripped off.

With the sampling of figures on this blog that represent the left and the right I can say with confidence that we are “boned”. What we are seeing now is the requisite fingerpointing while the wrong footed fight over how how to save the scraps of an imploded system.

The fight is kind of funny to watch in a train wreck sort of way. To me it looks like a fight with a couple of drunk, blind men staggering around with Hello Kitty pillows taped to their hands.

The conservative base in “on the rise?” If you mean it’s about to conduct a civil war between the Rick Santelli’s vs. Bo Duke’s, then yes, I agree.

Who is Bo Dukes?

It’s a reference to a TV show in the 1970’s-1980’s called the Dukes of Hazzard, about the Duke family (brothers Bo Duke and Luke Duke, and sister Daisy Duke). The Dukes were stereotypical “rednecks” in Georgia. In fact, one of the actors from the show eventually became a Republican Congressman.

‘To me it looks like a fight with a couple of drunk, blind men staggering around with Hello Kitty pillows taped to their hands.’

This could very well be the most pleasing and intrinsically satisfying image of this whole entire debacle, and I mean the WHOLE debacle, right here.
I’m just gonna sit here respectfully for a bit, and absorb and contemplate it.

While I agree with the sentiment, I think it’s too dangerous to blame this on one party or the other. Both parties have proven the obvious; with very few exceptions, politicians represent whoever pays the most for them. That and they’re all damned liars.

Unfortunately, the only thing shorter than a politician’s memory for inconvenient facts is the attention span of the American Voter. So we vote different crooks in once we tire of the old ones and that’s the way it goes.

/bitter

Wait until you see the magnitude of what Obama has planned. It pales in comparison to Bush. Wait and see….

Thank you for pointing that out from the grave, Ms. Rand. Far be it for me to stand in the way of the future Alan Greenspans of the world.

I’m sorry if I offended your Leninist sensibilities. Please don’t put me in the gulag, I’d prefer the .22 and the mass grave.

Could you teach me some “code words” first, you nutjob.

Why put a bullet where a little haldol would work just fine? I won’t put you in the gulag, if you don’t put me in Auschwitz, wingnut.

Y’know NSO, you’re just another internet tough guy bully. I said that I thought you seemed like a good guy and that you had a certain mindset that set you up as a crusader. I apologize if you took offense to that comment. I have been sucked into silly name calling match on the internet of all places and I should be better than that.

SCS, I can be just as contentious in a room full of liberal Democrats, given the right issues. But I think for myself and always respect others who do as well, even if they don’t agree with me. But people who vomit AM talk radio tripe, spam our forum with cr@p from nutjob bloggers or Faux News pablum seem to get my panties in a bunch quite easily, especially after the last 8 years.

Anyway, I agree that name-calling is déclassé. Truce.

Why put a bullet where a little haldol would work just fine? I won’t put you in the gulag, if you don’t put me in Auschwitz, wingnut.

Why bring the mentally ill into your little pissing contest?

When you use any reference to mental illness to disparage someone with whom you disagree politically, it does a great disservice to those who are sick and stigmatized through no fault of their own.

Phillygal,

Please provide a list all your sacred cows today so that I may never offend your tender sensibilities again.

I would take you seriously if you defended all the minority groups that get dragged through the muck, but clearly you play favorites.

Fine.

Diss on sick people all you want - knock yourself out!

And for you to categorize afflicted individuals as “sacred cows”…that just says it all.

LOL…

When you say “code words” do you mean like “Faux news..” and “..the last 8 years?”

OK…Got it. Thanks.

Corporations don’t borrow on lines of credit that can change their interest rate to 29.99% on a whim.

BINGO polly

polly,

Duly noted ( and all the more reason? )

Universities are the last fortress of Pure research.

I’m a big booster of academic-driven research, but higher education is not — nor has it ever been — a fortress of “pure research.”

Do even a cursory amount of digging and you’ll find pretty much any industry imaginable attempting to influence allegedly objective research that’s relevant to their particular field. Granted, those attempts (financial, philosophical and otherwise) don’t always work, but they work more often than they should. The conflicts of interest are already there, they’re just a little more discrete than outright business/academic partnerships (which also happen, by the way).

Hehe, Harvard B School being a classic example of this!

My appologies. Didn’t really think that sounded like you.

I will tell you that universities (like all other non-profit entities) have a preference for getting money that isn’t from their exempt business activities from donations and certain types of investment income. When they engage in businesses that are not related to their exempt purpose, they have to pay corporate taxes on it - it’s called unrelated business income and it is very complicated.

No sweat, and thanks for pointing out the limitations.

I posted this article because I was just thinking that this was the next group of enterprises to belly up to the Bailout Bar because they are too big to fail.

Largest exempt orgs (collectively) in terms of money are (in no particular order since I have no idea what the order should be): pension funds, non-profit universities, private foundations and non-profit hospitals.

+1, Elanor.

I suggest then (and to anyone else) that to enhance your feeings of do-goodism by voting for Osama Obama, that going forward you contribute to the general good by paying MORE to the government in taxes than the modest increase you’re happily looking forward to paying.

Not gonna?? Why not?? It’s for the children!!!

‘And I don’t feel like a victim either. I feel fortunate to have a good, stable career.’

I already thought you were neat-o. Now I see that you are neat-o squared. Maybe even cubed.

Elanor, if you won’t miss it then why don’t you just cut a bigger check to the government…. why must you force everyone else to?

Olygal: Oh, pshaw, now you’ve made me blush!

Blano, VTDan, and anyone else who is thinking of something along the lines of “so if you don’t mind higher taxes, give the gov’t MORE money voluntarily!”: Now you’re just being silly. Seriously, anyone high earner who isn’t living large is not going to stop buying stuff or see their lifestyle tank because they are asked to pay 3 or 4% higher taxes. C’mon now.

My reply may show up eventually. The important part was:

Oh pshaw, Olygal, now you’re making me blush.

Elanor,
There is no “asking” going on when it comes to taxes…. there is only a gun and a threat if you don’t pay up. This is called a demand.

Aren’t you generous with other people’s money… “they won’t miss it”. Well, I have just decided that “you won’t miss” 50% of your income because you live far better than 95% of the world. After all, you will still be able to afford 1 meal a day and a box over you head. Your logic is greatly impaired.

You have no better sense of “value” than anyone else. You cannot decide “how” someone else should spend their money.

Well said, Elanor. I’m amazed how the people who voted for 43, despite his profigate borrowing/spending and tax cutting, now are blaming 44 for acknowledging that the country is essentially bankrupt and trying to correct it.

Seems like a matter of perspective. Is it a tax increase, or are we bringing things back in line with where they were pre-2000?

I’m all for a tax cuts to stimulate growth, but it seems many of you who voted for change in 2000 have already forgotten the tax-cut and borrow strategy of the past 8 years.

Put the blame where it belongs, instead of fomenting more partisan BS.

I would happily give the government more money voluntarily, IF I made more than $250K, and IF others who made more than $250K did the same. That’s what voting for Obama was all about. I’ll pay my higher taxes if everyone else does, so that a schoolgirl in South Carolina can learn algebra without a train shaking her classroom.

Surely you could make do with a linoleum countertop in your custom wine celler rather than granite?

Good points by LA Investsor girl, Blano, and ViginiaTechDan.

Those who like higher taxes should walk the walk and donate extra money to pay. Not use a gun and bullet to force others to pay more. Who says socialists who vote for Obama are non-violent?

Some very wealthy people I knew in the late 80s/early 90s all said the same thing, they were glad to pay more taxes because it meant that they were making alot alot more. And on top of it, they felt it was the US citizens right, privilege and responsibility to keep up the US-streets, fwys, bridges,schools, airports, cops, firemen etc. After hearing this perspective, I too believe it is our responsibility to Repair the infrastructure and pay for the safety with cops/firemen etc.

“Those who like higher taxes should walk the walk and donate extra money to pay.”

The question isn’t whether anyone REALLY wants to pay more.

The question is, how do suggest we pay for the excesses of the past 8 years? I still haven’t heard it answered here yet.

Very well said, Elanor!

Thank you!

We also have no problem paying more taxes. It means we made more money!

We ALL benefit from a healthy, productive society where we don’t have such a disparity in wealth/income.

By this reasoning, I shouldn’t need a degree in finance or law to understand a mortgage document either. Yet when an FB says he doesn’t understand what he signed, the HBBers get all righteous about “personal responsbility.”

Not that I think these FB’s should be fully bailed out, but there’s got to be a good-faith compromise somewhere.

Buying a house used to have one sheet to sign in CA, and now it is over 30 pages the last time I looked. Sheesh.

and the problem exactly?

That’s not right packman. The deduction is a reduction of income, so the tax benefit is according to how each dollar is taxed.

So in your example, the tax benefit of the mortg deduction (without the change by BO) is (1,000*.33) + (49,000 * .28) for person B, compared to (50,000 * .28) for person A.

Another way to look at it is that person A would be taxed as having an income of 99,000 (149-50) instead of 149,000 while person B would be taxed as having an income of 101,000 instead of 151,000.

Well, I was including the M.I.D. in the AGI already, e.g. as if A had a $199k gross which ended up being $149k AGI after MID was removed.

However I think I get it now, going back to your original post.

Seems to me though this is a tremendous and unnecessary leap in complexity of the tax calculation. Before it wasn’t too bad - just subtract all your deductions (including MID) to get to the AGI, and then tax the AGI. Now the AGI has to be calculated (including MID), then do the tax calculation, then go back and do another calculation for how much tax has to be added in depending how much of the MID was above the 33% threshold or not, and add that as additional tax.

Seems like it’d be a lot easier just to have everyone take only 90% of their mortgage interest as a deduction and be done with it. Of course that wouldn’t be “spreading the wealth” then. Heck if he wants to spread the wealth, just up the higher brackets (more beyond what’s already planned) and be done with it.

Got to keep those accountants and lawyers in business though, I suppose.

(no offense meant)

I wonder why the Obama administration put in this cut in the mortgage interest deduction. Trying to throw us HBBers a bone?

Simple - it’s a new tax. It’s the first nick in the sacred cow’s death by 1,000 cuts. Or should I say the final death blow - originally all interest payments were tax deductible. Credit cards were the previous domino to fall, in 1986.

There is a lot of untapped tax revenue at stake here.

For some historical perspective on the whole concept of “slow death” - note that the federal income tax wasn’t introduced until 1913, and when it was the vast majority of people only paid 1%. Compare that with today…

This is why I think that this depression might be the final death blow to our economy, and possibly political system. The ever-increasing overhead of government has slowly just removed the ability to recover.

Olygal,

By all means rant all you want, insult anyone you please - as far as I am concerned you are the Housing Bubble Blog’s poet laureate, its id and its court jester.

Olygal, that was an impressive and de-escalating response. nicely done.

Thank you, Lavi. Thank you, Bronco. If either of you ever needs bail money, here I am.
Hahahaha!
No, serious, though.

Sighhhhh…..you see, as for the ‘vitriol’; those sad girls you’ve seen on the news, like that Warren Jeffs polygamist story, recall that one? And when they raided that compound in El Dorado, TX? The 15 year old girls walking along like pious blank-faced zombies with the bizarre pompadour hair-dos and lace-up boots and faded pioneer dresses and they’ve been a ’sister-wife’ since they were twelve years old, with a 48 year old husband who’s impregnated them with 2 kids by the time they’re 15? Them.
I, me, myself, Olygal, came within a hairs breadth, and I mean a skinny hairs breadth, not even a thickhairs breadth, of being one of them.

Where’s my reply? I was grateful. If not now, I will thank you again tomorrow.

Sobering thought Oly. To see you turned into a walking uterus would have been a huge tragedy. Seriously, I’m glad you decided to give birth to ideas instead.

The actions of the Fed are a whole ‘nother ball of wax. Not that I mean to dismiss that activity as insignificant, but it’s just another confounding set of events that exists outside the legislative process.

With regard to the stuff that went through the normal legislative process (the first 700B bailout), that sh*t is seriously on the shoulders of the Dems. Look, I have no doubt that Paulson and Bush are criminal, but blaming Paulson for “pushing” anything while ignoring the law makers that made it materialize is proposterous. The only authority Paulson had was to ask for money, it was the Dems that gave it to him to do as he please.

At the end of the day, its the legislature that passes laws and in this case, the Dems that pushed this through are the ones primarily responsible. It’s a distasteful analogy, but imagine a child pornographer (or some such person) and then imagine a parent that willfully delivered a child to the criminal.

I don’t care to argue about which of those people is worse (I tend to think its the parent), but you’re blaming the one criminal and giving a pass to the other.

but they did the best they could under the circumstances.

You are being too generous, why? They could have done nothing. They could have done a hundred other things, structed bailouts in other ways. Instead they hurried to deliver billions to the wrecking crew. Now, they are blaming the repubs for giving money to banks. These people are as much deceitful criminals as the people they pretend to “fight” against.

The worst part of the whole thing is that each of the two “parties” have approximately half the population (including otherwise intelligent people) thinking they are really the good guys and it’s the other side that should be distrusted. It’s all a shell game…

“They did a sh*tty job, but they did the best they could under the circumstances.”

Whisky Tango Foxtrot! Are you kidding me? Was this the best the Democrats could do? My expectations for both parties are extremely low, but it looks yours (regarding the Democrats at least) are almost nonexistent. At least this is how it looks like to me, if you can say that “they did the best they could under the circumstances” regarding passing the TARP.

Bush not only signed the legislation, he made it palatable to the Dems to get it passed (since his own party was no longer in power and busy trying to distance themselves from him to save their skins).

I thought John McCain did that?

“They did the best they could under the circumstances”

The chiefs of the Fed, the Treasury, the White House, Minority Senate leader McConnell and Minority House leader Boehner were ALL screaming that Armageddon is eminent without an immediate bailout package, did they switch parties? Last time I checked, they were and still are Republicans.

Just like in Iraq, they got the Dems to play along on the pretext that there was no other choice, and that they had to decide immediately. This is how Republicans force unpalatable issues down the country’s gullet, out of fear. I already said the Dems were stupid to play along, but please don’t pretend that this wasn’t a 100% bipartisan swindle. I can post lots of links as proof, if your memory has failed you.

Just like in Iraq, they got the Dems to play along on the pretext that there was no other choice, and that they had to decide immediately.

Legislators get to vote directly on issues. Even when the Dems vote for issues which you evidently oppose (war in Iraq, Tarp) you excuse them for it as being not their fault. I’ll take this as evidence that a party can pretty much do whatever it wants and the party faithful will always find a reason to justify it. I guess faith isn’t just restricted to formal religions, eh?

Why don’t you just go ahead and start voting for Repubs, that way you can be a direct participant instead of electing repubs by proxy.

“Just like in Iraq, they got the Dems to play along on the pretext that there was no other choice…”

so, why didn’t they learn from this the first time?!

“fool me once…”

bluprint,

I think the Dems were trying to vote in the best interests of the country and cooperate in a bipartisan manner, just like the *Repub leadership* was asking begging their rank and file to do…talk about a party trying to play both ends against the middle.

However, we can expect Repubs to use their 41-59 “mandate” in the Senate to essentially posture and put their ideology of convenience above the interests of the country, especially when they were happy enough to abandon that ideology for the past 8 years while the deficit grew and Wall Street grew increasingly fat and corrupt.

Don’t lecture me about faith…What do Repubs stand for these days? I don’t think they even know anymore. Your party lost the White House and Congress for a reason. If they can’t man up and stop being such feckless hypocrites, they won’t be able to even so much as squeak in the Senate in 2010.

NSO, just follow the money.

Dems Sen Dodd Chairman Senate Banking Comt, Rep Frank Chairman House Financial Srvs Committee, Republicans Rep Blunt House Minority Whip and Sen Gregg Ranking Member of Senate Banking Comt; together have taken $20 mil since 1989 as Campaign contributions from banking, finance, insurance & real estate companies.

The above mentioned were the 4 top negotiators representing American people in WS bailout negotiations.

NSO, it’s not my party. Neither of the two are my party.

I was only pointing out initially the absurdity of you banging on the repubs for a bill passed by democrats. legislators pass laws, not presidents or treasury secretaries.

Just because you are being completely illogical with how you place blame for the tarp doesn’t mean I’m either part of or defending the republican party. I’m just pointing out the ridiculous democrat right now. Next week or next year or whatever it’ll be a republican. Especially considering there’s not really that much difference between the two anyway.

As someone wrote the other day,

“Trickle down = tinkle on”

“Bush and Obama “are members of the same party”. What other parties did we realistically have to choose from?”

if you really march to this sentiment, you are part of the problem

“you are part of the problem”

All criticism and no answers?…yeah, so are you.

Wrong; at least I tried. I voted for Ron Paul, and tried to convince everyone I know to do the same.

+ 100

who decides fair?

I certainly don’t have this problem as far as taxes go, but I HAVE done the 80-hour work week thing. It seems to me if anything a person working like that should be paying less taxes on the margin, as the “value” of each additional hour spent at work instead of with your family or on the golf course or whatever, goes up, not down.

lainvestorgirl has been a member of the “it’s not fair” crowd ever since I can remember. Not very interesting except as a cultural phenomenon - people who think that the social order that allows them to become wealthy just magically appears and doesn’t need any money to keep it going. Or, they don’t recognize that as people who make a lot of money, they are benefitting much more from the creation of that social order than others are.

I guess that is what living life in a vacuum is like.

I worked 12 hour and up days six or more days a week as newly minted transactional lawyer too. It wasn’t fun. So what? The fact that I don’t do that anymore doesn’t mean there aren’t plenty of other people lined up to do it now.

polly,

According to lainvestorgirl you don’t rate, you are just a wage slave.

LAIG wrote:

I am passionate about this because I had the experience of working as an (honest) transactional lawyer before I got into real estate, and I know what a 12 hour day does to you, day after day, and it ain’t right to penalize people like that.
——————-

Okay, now I have to butt in here.

I used to work as an operations manager at a production/assembly facility. We had hundreds of Latin American workers who were making close to minimum wage. Some of them voluntarily worked 12-18 hour days, at least 2-3 times per week or more, so they could get the overtime.

These people, and others like them, produced far more than a lawyer will in his/her entire lifetime.

I am sick and tired of hearing white-collar workers complain about paying taxes because they are so “productive” while they call the REAL productive workers “parasites” because they are poor.

Get over yourselves. Be grateful that you get to make more than the vast majority of the world’s population.

As polly stated, you are the greatest beneficiaries of the (tax-funded) system that paved the road for your income-earning capabilities.

That’s an excellent question. Regardless of political party, we shouldn’t be foisting our government’s debts on our children…we made the choices, not them.

“That’s an excellent question. Regardless of political party, we shouldn’t be foisting our government’s debts on our children…we made the choices, not them.”

Correct. Answer? Tax’em Danno! And be thorough about it.

Who should pay? Good question. Why does Mozillo and all the other CEOs that made fraudulent loans get to walk away with millions of dollars, why not make them pay for this, ay?

Did you just say that the ceo’s are “gone and so is the cash”? You did. Next up are new earners of big $$$. It’s time to make’em pay!

Why do we have to pay for any of it? The argument has now been misdirected from “What business does the government have interfering with private business?” to “Who should pay for it?”. It was an easy transition because who doesn’t hate rich people! (For the record, I’m far from rich, even “250k” rich, but I don’t believe they owe me their money.)

The proposed income tax increase is a very small drop of water in a very big bucket. Most of this will be “paid” by inflation, which has me very scared. The government just voted to inject trillions of dollars into the economy, which should have had an inflationary effect on markets, but they went down even more. Our GDP is shrinking. The only things floating us are T-Bills. A sudden (justified) loss of confidence in the value of T-Bills will nuke us . How much more government will we need to save us then? (And, ahem, who will pay for THAT?)

“So who should pay?”

NO ONE. That’s the whole friggin’ point.

If the money isn’t spent, then no one has to pay it. In other words - stop the insanity of the bailouts, the stimulus, the socialized health care, the wars, etc.

The the debts will remain private - the banks etc, and the writedowns will be passed down as losses to the people who made bad business decisions, as it should be. Not to prudent savers and the general public via taxes and inflation.

Ultimately, a society that employes these kinds of taxes becomes a totalitarian state and everyone is impoverished. Then the rape, bribes, unjust prison times etc can be compared on equal footing.

Give me a break…people complain about our tax rate approaching Sweden(highest tax rate in the world - 56%) or Norway or Finland, but those countries are not totalitarian states by any means ( except for maybe fostering ABBA on the rest of the world ). The sexual crime rates and incarceration rates in those Scandinavian countries is lower than the US.

They are actually very nice places to visit and vacation. Sure the winters are cold and the beer is expensive, but the people are very pleasant.

I believe Belgium has the second highest tax rates at 52% and that country, although technically still ruled by a king is not even close to being a totalitarian society. You can walk right across the border and no one stops you or asks for a passport.

VTDan I think you should take advantage of the strong dollar and vacation in Europe this year and see first hand the effects of high marginal tax rates.

Scandanavian countries have the lowest suicide rates on the world.

“My “fair share” of the tax burden is $0… everything else is unfair because it was taken from me without consent.”

Maybe Dan, maybe….but if you take advantage of the services, that doesn’t make sense.

If you take a job knowing that taxes will be owed, is then paying them without your consent? Or is it like complaining about your bar tab at the end of the day?

We voted for all the crooks that are/were in office.

In reply to potential buyer - here are some suicide rates from WHO ( rate per 100,000, year reported)

Lithuania - 38.6 (2005)

Finland - 20.1 (2005)
Denmark 13.6 (2001)
Sweden - 13.2 (2002)
Norway - 11.5 (2005)
Canada - 11.3 (2004)
US - 11.0 (2005)
Netherland 9.3
Italy 7.1
Maybe you have some newer figures that support your claim.

I developed a quick excel based on a table from WHO at this link—–> http://tinyurl.com/ytvygu

Here is the top 10 countries with combined highest suicide rate based on data available in 2008.

LITHUANIA
BELARUS
RUSSIAN FEDERATION
SRI LANKA
HUNGARY
SLOVENIA
KAZAKHSTAN
LATVIA
JAPAN
UKRAINE

Those horrible socialist hobgoblin countries?

Denmark #29
Sweden #30
Finland #17
Canada #41
Norway#40
Nederland #51
Germany #32

Virginia Tech Dan –

Nice to see another rational person on this board, they are so scarce these days. How odd, the same crowd that was crying all these years about how the goverment and bankers were conspiring to make housing unaffordable to them, now think that using the power of taxation against their fellow citizens who had no part in this bubble is a great idea. Sigh. Maybe they’ll learn when unemployment hits 25% and the Dow 5000?

oh yeah and those evil socialist countries have universal healtcare so if you lose your job and have a life threatening disease, your only option isn’t to just die (happening to relative of mine right now in good ole US of A)

LAIG: I liked you a lot more when you whined about how long it was taking for West LA real estate to fall. What’s new on the RE front down there?

The power to tax is the power to destroy. If they claim the power to tax 39% why not 100% the morality is the same regardless the percentage.

Earning a living by doing work for others who voluntarily pay you for services is a god-given right. Anyone who attempts to exact a tax on your labor is exercising a form of slavery.

Then again, many people probably support the draft and Obamas mandatory community service too…

LITHUANIA
BELARUS
RUSSIAN FEDERATION

I believe all three of these countries have implemented a flat tax.

Flat tax isn’t any more fair than any other system.

I have been to europe and have family that lived in Sweden for 2 years. Trust me, the grass isn’t greener over there.

‘Scandanavian countries have the lowest suicide rates on the world.’

Maybe because they don’t have any guns, or people who drive fast enough to help ‘em out?
Maybe it’s an accident they don’t kill themselves alla time.

Paralegal? yes. Attorney? puleeeeez.

Oh, yes. Absolutely. That’s what I was saying.

*assumes wise thinky face *

Hey, what’s a quantum? Is that like a budgiderigar? Budgergerigar, whatever, one of them thingies? Another parakeet? Or is this one, finally, a taco or an exciting ointment?

Hey, what’s a quantum?

A quantum is a four-chambered tummy.

Quantum cows, then?

Well we didn’t get a constitutional court either. We got a rightwingnutjob court. Dernit, yer vote screwed up agin.

last time i checked it was based on electoral college, not popular vote.

(Not that I agree with it, but that is the existing scheme.)

And what % of the vote did the Boy President get?

Bronco, without the Electoral College, all of the U.S. would be in the same condition as California. Why? Because States elect Presidents, not the Sheeple (the same crazy disorganized mob that is held in such low esteem on this board).

A 52% mandate is really a 26% mandate when you factor in the majority who know that they are given a false choice between two candidates both supported by the big banks. Then factor in that 50% of those who voted for Obama were voting against McCain even though they despise Obama.

The inability of politicians/media to be honest about “mandates” is just more proof that they care not for the truth and are merely grasping for any hint of legitimacy to their rule.

The word “this” in my original post is a link.

and it was satire…at least I presume it was.

Either way, I didn’t see no grandma bleedin’ on the MSM which is what I’m after.

I never had enough money to bring to the closing.