The Housing Bubble

Well, I’m back in the world after a blitz through foreclosure land out west. I saw some crazy stuff, again. Like this one place called White Hills, AZ, a few miles south of Hoover Dam. I have come to accept that some people see places like this as perfectly livable, where I might not. But I feel the same about most of California, yet people there like it.

Anyhoo, we’ve got snow on the peaks this AM, and the coffee is good and home-made biscuits with peach preserves. Things could be worse, I must say.

White Hills AZ certainly is a “place”.

..Populated (Community) Place - Class Code U6
A populated place that is not a census designated or incorporated place having an official federally recognized name.

I can’t find population numbers.. can’t find anything really.. elevation is 2,792 feet.
Google maps Satellite view shows desert and hills.. zoom in to some roads and a few homes. Seems to be like 6 foreclosures from $80K to about $1M but i think that was land.

But it is pretty close to Vegas.. a genuine desert rat might be happy out there in nowhere-land.

no biscuits here.. woke up starving so it was steak and eggs for me. Gonna hit Walmart later .. i hope they have a Sony TV i been eyeballing..

One of my favorite sayings from N. AZ. “There is no there, there”

That’s what Gertrude Stein said about Oakland, isn’t it?

No. Wyoming. I just pass through there every month or so.

Yeah okay…I know generally where you are…

Keep it quiet, we like our privacy……..

I am jealous of any landlord who owns property on Maui, regardless of the strength of the rental market. Enjoy your life in paradise, and assume things will get better, and I bet they will

You are probably more optimistic than I. Maui was built on an unsustainable model. Too many hotels chasing not enough tourists. And the tourists that come are the package deal type that do not spend like the Japanese. Or the FIT’s. This summer was ugly. And winter does not look any better.

For the first time in recent history the population here has decreased. Nothing is selling. The third largest resort on Maui (Makeana Prince) defaulted on it’s note last week. The lender put up payroll this month but the word on the street is the hotel is not even bringing in enough to pay the workers let alone service their debt.

Maui has always been boom or bust. So its not like we have not seen this before. I fully expect a return to mid 90’s prices in the next few years. And even at those prices I would not buy again. Until the neighbor islands become way less dependent on tourism we will return to the backwater days of the ’50’s.

That said, If you can handle the fact you are on an island, it is one of the easiest places in the world to live. And come winter, when most of you are freezing, I will be at the beach,or in a waterfall, or diving for lobsters… well you get the idea. I will try not to gloat…. Too much.

“That said, If you can handle the fact you are on an island, it is one of the easiest places in the world to live.”

I guess it depends to a great extent on one’s livelihood. A friend is moving back to the lower 48 because the Honolulu Symphony is no longer paying its musicians enough to make ends meet…

I have heard that Honolulu Symphony was recently paid in full… for last season. And to be honest without state support it will die.

You are right. Jobs have always been the problem. To live here many work two jobs. And right now the State wants to lay off more than 1000. We are hurting. And there is no hope in sight.

Add that to the countless Californians and others that came here and bought their dream house with equity from their home and we will take a smoking. When this has run it’s course we will lose 50,000 people (out of 1.2mil).

“To live here many work two jobs.”

My friend’s BIL is also in the orchestra. Last time I visited them, BIL was eeking out an existence as a violist and an inter-island tour pilot. Apparently piloting airplanes also pays a pittance in HI.

This gets to a theory of housing/labor market equilibrium I have posted numerous times on the blog: Due to high labor supply and high housing demand, wages are suppressed and home prices inflated in places like HI and San Diego where ‘everyone wants to live.’ Thus the equilibrium (non-bubble) home price to income ratio is higher than other places for desirable locales.

“I fully expect a return to mid 90’s prices in the next few years. And even at those prices I would not buy again.”

bbbbbbut….. my house millionare $70k/yr wage slave brother says all the millionares want to live on the north shore and his retail priced $275k shack is worth a million now….

You mean he’s wrong CrashAndBurn?

Due to high labor supply and high housing demand, wages are suppressed and home prices inflated in places like HI and San Diego where ‘everyone wants to live.’ Thus the equilibrium (non-bubble) home price to income ratio is higher than other places for desirable locales.

Is that an elegant restatement of “It’s different here”?

I agree—I think it is only a matter of time.

Well the thing about ICBMs is that for the most part they just sit there. So except for the one’s that have been repurposed as launchers, we really don’t KNOW how reliable they are. But it is almost certain that the acceptable reliability rate is MUCH lower than for commercial aircraft. After all, they only have to work ONCE, and if 5% fail, you’ve STILL nuked your enemy into the stone age.

Yeah.. ICBMs may not be a good example except that they show some capability as far as technological know-how.

But how hard can it be to reverse-engineer a 747.. gimme China’s resources and i bet I could do it..

maybe i’m too optimistic by nature

Wouldn’t go that far, joey.

Mmmm… the reason I don’t think China is going to be competing in the airplane industry any time soon is that the mindset they have when it comes to construction is not quite up to the zero-fail needs of airplanes. I mean, take a look at the car lines they’ve tried to export to Europe; Germany did some crash tests and found that they were slightly worse than riding in a tin can. Fatalities at 30 MPH.

It’s not that they can’t do quality work, it’s just that the cultural tendency is to take shortcuts and do cheaper substitutions, and it only takes one failure to create a horrendous problem. The Alaskan Airlines crash that happened about a decade ago off the coast of California was caused by the wear failure of one single part– and the black box revealed that if the failure hadn’t been so catastrophic, the pilots could have saved it. And each part has several points at which it can fail due to something as small as inattention during metal curing.

This may change. After all, “Made in Japan” used to be synonymous with cheap. But I’d give it at least a decade, probably two, before thinking of airline competition from China.

The Russians have been building planes for decades. The airframes are in fact quite good. Yet airlines aren’t really lining up to buy their planes. Not even ex soviet airlines. Their only customers are from the embargoed countries and a few cargo operators. The planes are cheap yet the after sales support just isn’t there.

Try getting the Chinese to do a safety audit or an honest crash investigation.

Well, neither China nor Russia really appreciates the finer points of capitalism at this time. Simple things like a warranty, which capitalist customers take for granted, must be foreign concepts to people who’ve had no choice but to take what’s given them.

Currently, China finds competitive advantage in lower production costs and lower prices. That’s all they know. But there are many other advantges to be had in the world of marketing.
For instance, there’s always a market for top quality. If China realizes that, they might decide to produce the absolute best-of some product. It probably won’t be airplanes at first, seeing how that’s one complex and expensive training ground.. but give it time.

Just as Japan and similar former slave-wage states entered the world market by slamming out cheap crap for general consumption and eventually grew out of it, so will China, imo.

Here’s a little more about the Business Roundtable (via Reuters):

“Business Roundtable is an association of chief executive officers of leading U.S. companies with more than $5 trillion in annual revenues and nearly 10 million employees.

Member companies comprise nearly a third of the total value
of the US stock markets and pay nearly half of all corporate income taxes paid to the federal government. Annually, they return $133 billion in dividends to shareholders and the economy.”

Sounds like a buncha yella-belly communiss’ to me!

:?:

What is this “long-term outlook” of which you speak?

What is this “long-term outlook” of which you speak?

Increasing costs for both individuals and businesses.

ET, I was being snarky. Since when did any entity try to look at the long-term outlook? CEO’s look at the next quarter. Politicans look at the next election. Obama is trying the long-term thing and you see what they’re saying about him.

Ah, I missed the snark. My apologies.

Missed the ’snark’ too, but liked the New improved Question marks!

For one, big pharmaceuticals have long supported the idea.. even contributed to the cause.. and insurance companies also like it.

Pffft.

Big Pharma and the rest of the healthcare industrial complex see the writing on the wall, and are frantically trying to minimize damage to their sectors as best they can. They support the idea of maximum profitability, and little else.

Good point- I meant a single payer universal health care system. Like most everybody else in the modern world.

Sure ET.. they want max profits. Who doesn’t? But aside from price controls, what does big Pharma have to fear from any sort of universal care? What is the writing on the wall?

Big pharma is bulletproof. The govt sure isn’t going to start producing pharmaceuticals.

Big pharma is bulletproof. The govt sure isn’t going to start producing pharmaceuticals.

Their profits aren’t bulletproof. Their rate of profit isn’t bulletproof. Their ability to advertise incessantly about medical crises such as ED and toe fungus and drive sales via the consumer isn’t bulletproof. Their ability to access doctors directly and influence sales is not bulletproof. The current protocols regarding clinical trials and FDA greenlighting aren’t bulletproof. The way research dollars are distributed and reimbursed is not bulletproof.

In other words, there’s a helluva lot more at stake beyond price control. And price control itself is a pretty big issue.

Does ED result in toe fungus..or vice versa?

Sorry this is so long…

History of Penicillin
Originally noticed by a French medical student, Ernest Duchesne, in 1896. Penicillin was re-discovered by bacteriologist Alexander Fleming working at St. Mary’s Hospital in London in 1928.

…It was not until 1939 that Dr. Howard Florey, a future Nobel Laureate, and three colleagues at Oxford University began intensive research and were able to demonstrate penicillin’s ability to kill infectious bacteria. As the war with Germany continued to drain industrial and government resources, the British scientists could not produce the quantities of penicillin needed for clinical trials on humans and turned to the United States for help. They were quickly referred to the Peoria Lab where scientists were already working on fermentation methods to increase the growth rate of fungal cultures. One July 9, 1941, Howard Florey and Norman Heatley, Oxford University Scientists came to the U.S. with a small but valuable package containing a small amount of penicillin to begin work.

History of Peoria Lab (penicillin and more):

Agricultural research has been extremely beneficial to the United States. The United States has always been a worldwide leader in agricultural production and technology. The United States Department of Agriculture (USDA) and its research laboratories like the National Center for Agricultural Utilization Research (NCAUR) are strong contributors to this standing. Since its debut in 1940, the NCAUR in Peoria has touched many lives with its ingenious innovations and has made countless gifts to science and business.

The NCAUR, more commonly known to Peorians as the “Ag. Lab,” was first authorized by Congress as part of the Agricultural Adjustment Act of 1938.

http://www.lib.niu.edu/2000/ihy000223.html

Slate Article on the history of socialized medicine:

As Paul Starr explains in his classic Social Transformation of American Medicine, the idea of government-run health care dates to the Progressive Era. Originally called “compulsory health insurance,” it enjoyed favor in the 1910s among many quarters, including the American Medical Association. Many doctors expected that national insurance would encourage preventive medicine, thus saving money and lives. But as the debate heated up, doctors began to worry that it would hurt their incomes, and they banded with business groups like the National Association of Manufacturers to oppose reform. American entry into World War I tabled consideration of the issue, and the postwar Red Scare, Starr notes, “buried it in an avalanche of anticommunist rhetoric.”

http://www.slate.com/id/2175477/

The NIH:

In 1930, the Ransdell Act changed the name of the Hygienic Laboratory to National Institute (singular) of Health (NIH) and authorized the establishment of fellowships for research into basic biological and medical problems. The roots of this act extended to 1918, when chemists who had worked with the Chemical Warfare Service in World War I sought to establish an institute in the private sector to apply fundamental knowledge in chemistry to problems of medicine. In 1926, after no philanthropic patron could be found to endow such an institute, the proponents joined with Louisiana Senator Joseph E. Ransdell to seek federal sponsorship. The truncated form in which the bill was finally enacted in 1930 reflected the harsh economic realities imposed by the Great Depression. Nonetheless, this legislation marked a change in the attitude of the U.S. scientific community toward public funding of medical research.

http://history.nih.gov/exhibits/history/docs/page_04.html

Government-funded science:

The government role in supporting research in the scientific community at large was greatly stimulated by the vision enunciated by Vannevar Bush. Bush wrote, “The Government should accept new responsibilities for promoting the flow of new scientific knowledge and the development of scientific talent in our youth. These responsibilities are the proper concern of the Government for they vitally affect our health, our jobs, and our national security.”8 Bush used the word “jobs” to describe what elsewhere he referred to as “prosperity” or “public welfare.” The concept is now commonly referred to as “economic security.” The three areas identified by Bush were those of most concern at the time. Were Bush writing today, he would probably add others, including “the environment,” “green manufacturing,” and “clean energy sources.”

Bush saw the benefits of research accruing to a wide range of national needs rather than to a single objective, such as defense. Indeed, he concluded his letter to President Truman transmitting his report with a broad vision of the impact of science on quality of life: “Scientific progress is one essential key to our security as a nation, to our better health, to more jobs, to a higher standard of living, and to our cultural progress.”9

Vannevar Bush clearly recognized that applications of research results often appear many years after the work is started and that there is no certainty as to which of the many national needs will benefit from this work. He also observed that “…basic research is essentially non- commercial in nature. It will not receive the attention it requires if left to industry.”10 Today this concept is recognized as a lack of “appropriability.” Because of the long-term nature of research and the uncertainties in predicting its practical applications, a company cannot be certain that investment in research will result in a competitive advantage in the worldwide marketplace. Indeed, the increase in global competition has exacerbated the “appropriability” issue. It consequently has increased the need for government support of research.

The Bush vision encouraged the mission agencies to support research universities in fields that were deemed to have probable long-term relevance to their missions. It also led to the establishment of the National Science Foundation and the gradual building of its budget to the point that it has become a major source of support for science and engineering in our universities. The National Science Board was created with its dual mission of overseeing the activities of NSF and monitoring the health of science in the Nation.

As a result of implementing the Bush vision, our research universities have become the envy of the world. The application of new knowledge and talent in science has indeed created handsome benefits in the three areas Bush identified. We will cite just one example in each area. The understanding of the structure and properties of DNA opened up totally new opportunities to address health issues and provided the basis for the vibrant new biotechnology industry. Polymer and photochemical research led to the creation of photoresists that are key to the success of the microelectronics industry, which accounts for well over a quarter of a million jobs in the U. S. today. The atomic clock, which was based on research in atomic physics and was stimulated by needs in astronomy, provided a foundation for the development of the Global Positioning System to satisfy a critical defense need. More recently, it is creating a large commercial marketplace for everything from ships to backpackers.

http://www.nsf.gov/nsb/documents/1997/nsb97186/nsb97186.htm

Are you sure that’s math? What’s the equation? And if a company doesn’t have to pay insurance on their workers, would that not make their products cheaper to produce, and therefore more competitive? I know it gets paid somewhere, but it’s not reflected in the widget price.

Yes, I’m pretty sure it’s just math. You don’t need an equation to see this, only to hide it.

The exception is when you steal the difference from someone outside. That catches up with you too.

Unless they’re dying on the side of the road, everyone’s covered. The way it’s set up now, though, the ‘uninsured’ can’t get preventive care, which is cheaper, and they get their primary care through the emergency room, which is very expensive. We have universal coverage, just the least effective, most expensive kind. How does that help our competitiveness?

I agree with you on that.

BTW, it seems to me that the “Emerge”, as they call it, is the way the system works in Canada. Does not seem efficient to me at all, nor to them. Long waits as well.

Blue skye, not from what the canadians tell us here.
Waits, not so long. Certainly NOT longer than waiting for our appts here.

www dot health dot gov dot on dor ca/transformation/wait_times/wait_mn.html

One example: breast cancer surgery in Toronto at Sunnybrook Hospital; wait time is 41 days. That is ridiculously long.

Another example: wait time for an MRI in Toronto at Scarborough Hospital: 94 days. Are you effing kidding me? 3 months for an MRI? I had an MRI for my back 2 years ago and my wait time was a whopping 5 days, and that included a weekend.

My Gf is Canadian. She has the public option (Emerg) and the private option as her teacher’s union has private coverage. She dreads the Emerg, as waits are many hours long. Maybe it is different here, there.

Of course, if a Yank is in Canada and asks anything about Canada, the answer is that it is much better in Canada than in the US, in every way possible. It is only when everyone is relaxed, and forgets that you are not one of them in that way, that other expressions eek out. It is human nature.

The wait is longer for most unneeded treatment in countries that have socialized health care. We Americans just can’t stand the idea of not getting an MRI on our zits right away.

(link doesn’t work, Eddie)

Have you been to an American emergency room lately? If you’re dying, you get in fast- just like in Canada. If you’re stable, prepare to wait hours.

Mil had to wait 8 hrs in emergency.
12 other hrs to have MD appear.

I should add that I fully expect the REIC to exert a full-court press on the PTB to extend and/or expand the credit as its Dec 1 expiration date approaches. The typical argument will be something to the effect of, “The program is obviously working well, as evidenced by the recent big uptick in home sales.”

I also predict that, in the event the credit is extended or renewed, the announcement will be made on or after Dec 1, in order to create the maximum possible “surprise” impact on market psychology, and also to milk the race to use the credit before it expires for all it is worth.

Homebuyers cashing in $8,000 tax credits

First-time homebuyers around the country have started to cash in on their tax credits from the Recovery Act.

By David Goldman, CNNMoney dot com staff writer
Last Updated: September 4, 2009: 2:27 PM ET

Map
Where the $8,000 tax credit is going

These 7 new homeowners stepped up their house-hunting to take advantage of the first-time buyer tax credit — before it expires on Dec. 1.

NEW YORK (CNNMoney.com) — Hundreds of thousands of first-time homebuyers across the country have begun to claim their tax credits, according to new government data released on Friday.

So far, nearly 315,000 people have claimed the tax credit after filing an amended 2008 tax return, according to a Treasury Department report on the status of the Recovery Act.

California led all states with 42,304 claimed credits.

Eligible first-time homebuyers can claim the credit of up to $8,000 — or 10% of the home’s value, whichever is less — on either an amended 2008 return or on their 2009 return.
…

We just received our tax credit. It did not influence our decision to buy when we did (we’ve been planning to buy when prices dropped to where we were comfortable), but I know that’s not the case for many of the people buying now. It comes up in conversations with neighbors who have relatives looking to buy.

The thing I’m interested to see is what happens after the California moratorium on foreclosures expires on the 15th. There’s currently not anything but short sales in the reasonable price range*; all of the foreclosures were bought up. The amusing part, to me, is that they not only kicked the can down the road, they kicked the can down to a time of year where sales are traditionally lower. It makes you wonder how little they thought these things through.

*There’s a short sale that’s been on the MLS for at least a year and a half, possibly two or more. It’s dropped 50% of its value, I think. Will it ever sell? Mmmmaybe?

John Mauldin commented on Krugman’s article in his newsletter yesterday,

http://www.frontlinethoughts.com/gateway.asp

While I thought Krugman did a good job explaining the various schools of thought in economics and why he thought they were blind to the risks, I was hoping he would acknowledge the fact that the risk was clearly apparent to so many lay people early on as the bubble grew. His explanation, that economists were enchanted with the beauty of the math, adds to my belief that the decision makers are out of touch with bith common sense and the daily experiences of the rank and file.

“I was hoping he would acknowledge the fact that the risk was clearly apparent to so many lay people early on as the bubble grew.”

The only valid opinions in Krugman’s universe come from the lips of dismal scientists with lengthy academic publication records.

“There was nothing in the prevailing models suggesting the possibility of the kind of collapse that happened last year.”

It sounds like the mainstream economic models neglected to factor in crazy government lending programs designed to enable central valley agricultural workers pulling down $30,000 a year to qualify for loans to buy houses at prices north of $700,000. Who would have thought crazy loans securitized and sold to investors as AAA-rated MBS could have caused any problems?

“As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth.”

I propose this new school of economic thought hereafter be known as The Emperor’s New Economics.

Thanks for posting the Krugman piece. I am having difficulty reading it slowly enough to fully appreciate it.

Suggested alternative title:

“Everything you learned in graduate school was a lie.”

“Freshwater economists are, essentially, neoclassical purists. They believe that all worthwhile economic analysis starts from the premise that people are rational and markets work, a premise violated by the story of the baby-sitting co-op. As they see it, a general lack of sufficient demand isn’t possible, because prices always move to match supply with demand. If people want more baby-sitting coupons, the value of those coupons will rise, so that they’re worth, say, 40 minutes of baby-sitting rather than half an hour — or, equivalently, the cost of an hours’ baby-sitting would fall from 2 coupons to 1.5. And that would solve the problem: the purchasing power of the coupons in circulation would have risen, so that people would feel no need to hoard more, and there would be no recession.”

Now enter a Fed chairman who fears deflation more than Superman feared Kryptonite and ask yourself whether this kind of price adjustment is possible in the real world.

“And Lucas warned that any attempt to fight the business cycle would be counterproductive: activist policies, he argued, would just add to the confusion.”

He was right. I’m really confused.

‘In 2004, Alan Greenspan dismissed talk of a housing bubble: “a national severe price distortion,” he declared, was “most unlikely.” Home-price increases, Ben Bernanke said in 2005, “largely reflect strong economic fundamentals.”

How did they miss the bubble? To be fair, interest rates were unusually low, possibly explaining part of the price rise. It may be that Greenspan and Bernanke also wanted to celebrate the Fed’s success in pulling the economy out of the 2001 recession; conceding that much of that success rested on the creation of a monstrous bubble would have placed a damper on the festivities.’

By no coincidence whatever, interest rates are also unusually low, not due to any kind of ‘fundamentals’ but rather to deliberate financial engineering by the Fed chairman and company. Why pretend that market fundamentals are driving up home prices when the root cause is financial engineering by the guys with the printing press?

…rates currently are also…

‘Eugene Fama, the father of the efficient-market hypothesis, declared that “the word ‘bubble’ drives me nuts,” and went on to explain why we can trust the housing market: “Housing markets are less liquid, but people are very careful when they buy houses. It’s typically the biggest investment they’re going to make, so they look around very carefully and they compare prices. The bidding process is very detailed.”’

Since FPSS does not appear to be posting much these days, I feel compelled to fill in for him:

BwaHaHaHAHAHAHAHAHAAAAAHAHAHAHAHAAAA!!!!

“Indeed, home buyers generally do carefully compare prices — that is, they compare the price of their potential purchase with the prices of other houses. But this says nothing about whether the overall price of houses is justified. It’s ketchup economics, again: because a two-quart bottle of ketchup costs twice as much as a one-quart bottle, finance theorists declare that the price of ketchup must be right.”

Ketchup economics only works for setting home prices with the help of bailouts for banks that make unaffordable loans. Let the banks eat their bad gambling losses and the ketchup valuations will disappear overnight.

“And Friedman certainly never bought into the idea that mass unemployment represents a voluntary reduction in work effort…”

This is crazy talk. Just do a survey of unemployed workers to ask how many of them voluntarily quit their jobs if you want to test the validity of RBC Theory. But that doesn’t mean it wasn’t good enough to win its inventors a Nobel Prize in Economics.

The Chicago School is to economics as the Roman Catholic Church was to religion, about the time when Martin Luther came along.

My personal view: Freshwater economics can be largely salvaged by including too-big-to-fail bailout policy in their models. In light of the extent to which bad gambling debt was paid off by the financial rescue, where is the irrationality in the bad behavior of Megabank, Inc?

decision makers are out of touch with bith common sense and the daily experiences of the rank and file.

P Bear– You seem to believe the efficient market theory? How do you explain the tulip bubble, South Seas bubble, etc? There was no government distorting those ‘markets’. And yet they got their bubble on.

Actually the South Seas bubble had some government involvement, at least in the creation of the company.

“You seem to believe the efficient market theory?”

I believe nothing. I am an open minded agnostic when it comes to economic dogma.

But I certainly don’t believe the ‘efficient market theory’ in its pure form; didn’t my FPSS impersonation above make this perfectly clear?

“There was no government distorting those ‘markets’.”

Please cite your evidence, as I am highly skeptical.

And as I have often noted, absence of evidence does not constitute evidence of absence. As a post by Ben Jones yesterday suggests, the very existence of a bubble could be construed as a smoking gun for the involvement of a central bank or similar 800 lb government-sponsored gorilla.

Check wikipedia on ‘tulipmania’. There was no gov involvement on the level that we see today. The gov was tangentially involved in some ways- just enough to give efficient market theorists enough room to claim it wasn’t a perfect ‘free market’.

The problem with that line of argument is it’s the same you get from a communist/anarchist/idealist. Since we’ve never had a perfect form of *whatever*, we have no evidence it has failed. But maybe the reason we’ve never had a perfect form of *whatever*, is because perfection is impossible? So we have to extrapolate from experience, not fantasy. And experience seems to show that unregulated/free markets can bubble too.

“And experience seems to show that unregulated/free markets can bubble too.”

Fair enough. I guess the next level of discussion is whether it is better for regulatory authorities to turn a blind eye to developing bubbles, or to take measures to pop them before they become so ginormous that they threaten the global economic system.

My take: Bubbles should not be allowed (much less actively encouraged) to inflate to the point where they become ‘too-big-to-pop.’

I’m pro-pre-emptive bubble popping too. But that’s halfway to Keynesianism. And unless there’s some beautiful, elegant theory that explains away the paradox of thrift, then the gov has to do something to keep the economy flowing during the down times. That’s Keynesianism in a nutshell.

“I’m pro-pre-emptive bubble popping too.”

Check out my Modest Proposal for dealing with the too-big-to-fail problem (hopefully soon to appear at the end of today’s bits bucket).

I wonder how siamese twins file taxes? Jointly?

Jointly?

Apart from that…

2 schools of thought

Two social security numbers or one? What if one half committed a crime? Seems unfair to lock up the innocent half.

You know, DennisN, I’m overweight enough to be considered obese. I exercise every day, I try to eat less, I’m in a metabolic syndrome program to help me lose weight at the university where I work, I’m now in counseling to help myself regain healthy eating habits, and guess what ? Your asshole assessment of me and the rest of the obese citizenry of America isn’t helping me get better. Yes, I have a problem. Everyone, including yourself, has problems. I don’t whine about being overweight. I’m trying to do something about it. But, sometimes it seems like I’m pushing a boulder uphill to get healthier. Try to be a little bit more considerate, even if you evidently hold the obese in the greatest of scorn. I read and contribute to this blog, too.

With all due respect, Silverback, I don’t think DennisN was making fun of obese people, I believe he was making fun of all the scammers that are scamming everyone today.

Silverback,

Good for you for taking all those steps to improve your health. IMHO, it’s not all about “diet and exercise” as too many critics seem to think. I wish you the best of luck in reaching your goals.

Thank you.

Yeah, really. Leave the corpse at the back door of the crematorium in the dead of night.

Alpha - you forgot lavish unsupportable private pensions.

If you survived WWII - and most did - boy you were on a gravy train for the rest of your life. [As long as you were a white male.]

Perhaps you could give examples from your personal experience to support that broad brush.

AIDS patients used to enter into viatical agreements. Investors loved them because AIDS patients died quickly…..in the beginning. Then the drugs got better. No more short term quick profits. Serves them right for gambling on an individuals misery and death.

oops.. misread your post.. that’s what you meant by flip.

I actually misinterpreted the missing word in “What if ______ decides to ‘flip’ me?

The Big Flip

ok.. here’s the thing about getting whacked. If you do sell the policy you gotta be sure nobody knows about it.

Maybe a trusted third party who has no stake in the game should hold the policies as a bunch of anonymous policies. Only when someone dies do they report it, but until then nobody knows who’s on the list.
Some salesman gives you a contract after the sales pitch. You check “yes” or “no” and mail it in to that third party who then processes the yes-people.

Now, maybe there is no such entity.. maybe the names are available to the brokers or investors? And maybe the industry would benefit from the services of some enterprising person who would insert themselves as a sort of escrow company, and take a cut.

There really should be some identity protection if for no reason but to calm the nerves and help encourage sales.

I just watched the movie Amadeus last night with my wife and oldest son — first time I saw it since the early 1980s when it came out. Though the story of a jealous Salieri plotting to kill off his more musically gifted and socially vulgar rival Mozart is an urban legend passed down through the ages, the screen play suggests that it is possible to kill someone by providing them with the right incentives to work themselves to death.

I think the implication in the play (and subsequent movie) is that Salieri believes this, but he’s insane so who can tell?

Tangentially, there was a news report about fifteen years back that said they thought they’d found Mozart’s skull (tested similar to close genetic relatives), and if that was the case, he might have died from an under-treated skull injury, such as that gotten by a fall. Subdural haemotoma is a killer.

“…he might have died from an under-treated skull injury,…”

The Baker’s Biographical Dictionary says he died from acute nephritis. But the director’s cut of Amadeus, which includes the filmakers’ discussion in the background in one of the versions you can watch on the DVD, throws out a more complicated story, where Mozart may have treated syphilis by ingesting mercury, which is not necessarily the best thing for one’s kidneys.

sıɥʇ ǝʞıן

LOL

HOW did you do that!!!LOL

sɹǝddılɟ uʍop ǝpısdn

¡¡¡uʍop ǝpısdn noʎ uɹnʇ ǝɟıuʞ ƃuıllɐɟ ɐ ʇǝl oʇ ʇou ʎɹʇ

If I was a little big closer you would have to DUCK.

LOL

YOu are so funny. My other leg needs pulling to keep even.

Anytime CA…I am willing able and ready to under cut those civil service workers..

HINT: There are millions of us that need a job like last year!

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If you think you can do a better job for less money, I’m sure they’d love to hire you.