The Housing Bubble

Weren’t both FL and CA Spanish colonies before they were U.S. states? What is it about Spain and housing manias?

LOL! I don’t think we can blame those two on Spain. Those were our own doing!

“I don’t think we can blame those two on Spain. Those were our own doing!”

Having lived in and traveled around both states, I assure you Spanish culture remains a strong force in both places. Add some Mediterranean (or warmer) temperatures, and you have some good fundamental ingredients for a housing mania.

“Having lived in and traveled around both states, I assure you Spanish culture remains a strong force in both places”

Spanish culture is also a strong force in Texas and New Mexico, yet they were nowhere nearly as bubbly. And how about Canada and Australia? No Iberian heritage there (esepcially not in Oz) and their bubbles put ours to shame.

“Spanish culture is also a strong force in Texas and New Mexico, yet they were nowhere nearly as bubbly.”

Not everyone wants to live there; in fact, a lot of folks don’t want to live there.

Or you could interpret it as them really undercounting the shadow inventory.

but I don’t anticipate large-scale cratering.

Oxy,

That 60% number came from nowhere so it serves as a poor bases for you conclusion.

Or you could interpret it as them really undercounting the shadow inventory.

Perhaps, other than go by anecdotal experience, whay can we go by?

Jeff is always regaling us with the stories of his endless deadbeat friends, coworkers and neighbors who haven’t made mortgage payments in years. I have yet to encounter people like that in my neck of the woods. So maybe Florida really does have 30% of the shadow inventory … or maybe it doesn’t. How can I really know?

What I do know is that houses at and under $200K are selling briskly in my little burg (on average in less than a week after listing), while houses above 300K aren’t moving at all. And from what I’m hearing it’s not investors buying them either. One of my wife’s coworkers sold her house (180K IIRC) and had multiple offers. Yet at the same time a 400K golf course home across the street from us has been on the market for over a year.

I have yet to encounter people like that in my neck of the woods.

I have a relative doing it right now, but they don’t live near me. They never thought it would go on this long, but as long as nobody is asking them to leave, they can’t see any reason to.

Oh, I’m sure there are “deadbeats” even in fair Loveland, as well as a shadow inverntory. It just doesn’t seem so visible as it does in Floriduh.

‘So, the argument that house prices will “crater” because of “shadow inventory” would only apply to a handful of bubble states, not states like *ahem* Maryland.’

You are wrong, because you forget that ‘everyone wants to live’* in the sand states. A big collapse of prices in FL and CA will eventually spill over into lower prices in MA, due to the force of interstate migration on equilibrium home prices.

*I used parentheses because everyone doesn’t really have to want to live in CA, FL, AZ or NV for my argument to hold up; so long as the marginal buyer would prefer to live in CA or FL to MA, you get the result that equilibrium prices will always be lower in MA than CA or FL.

I give up.

The mania was not isolated to a few states. The mania was not everywhere except where you bought. You bought into the mania, when it is now obvious to most. There is no defence.

I’d say that the mania was wilder in some places vs. others. And in places with bad fundamentals (i.e. no jobs) the crash will be harder and nastier.

College can be a very expensive place to go just to find out who you are.

“College can be a very expensive place to go just to find out who you are.”

Yup, that’s exactly why I think it’s pretty silly for people to go for majors that either don’t interest them or don’t lead to a quantifiable financial advantage in the job market.

Spending 40-100’s of thousands to get an education in something that provides no real job skills just doesn’t make sense to me. I suppose if you’re already wealthy, by all means, go and make yourself a well rounded person. But, for the vast majority, if you don’t have a goal in mind (doctor, lawyer, engineer, etc) then it doesn’t seem to make a whole lot of sense to me.

This is why, IMHO, many nations (Japan comes to mind) are eating our lunch when it comes to job skills. Culture in different countries is much more “goal oriented” and seems to result in people more able to leave their education (at whatever level) and apply that education to a real job skill.

I’d hazard a guess that the number of foreign students enrolled for things like history, art, and language is dramatically lower (as a proportion) to the number of American students enrolled in those areas. And the reverse is certainly true for the sciences/engineering.

College can be a very expensive place to go just to find out who you are

Especially at today’s prices. At least in the “good old days” you could major in uinderwater basket weaving at state without having to borrow tons of cash. And corporations used to hire lib arts majors (now they just want biz majors).

I’d hazard a guess that the number of foreign students enrolled for things like history, art, and language is dramatically lower (as a proportion) to the number of American students enrolled in those areas. And the reverse is certainly true for the sciences/engineering.

From what I saw as an employee at two different universities and a student at another, your guess is pretty spot on.

And I would hazard a guess as to why: The foreign governments are subsidizing their students’ education in America. Their subsidies are based on national need. Many of these countries are not as advanced as the U.S., and they need educated people to build their countries.

The aviation business is the opposite.

About everybody gets into it because they like flying. About everyone who has been in the business 20 years or longer is looking to get out, because “love” doesn’t pay the bills.

Kinda like the music business. When I was about to get out of the Army band field one of my buddies got a pretty good gig playing for one of the Mandrell sisters for part of each year and tried to talk me into joining him. I decided to stick with engineering and never regretted it. His life on a houseboat near Nashville sometimes looks kinda fun, but only if I was still single like him. No thanks.

“College can be a very expensive place to go just to find out who you are”

But a dead-end job with no escape can be far more expensive…

Haha, he’s gonna really hate pharmacy, if he goes retail.

He’s strictly hospital based, intensive care and surgical. His retail rotation was in Richmond, CA. His first week was marked with a shoot out across the street. But prior to pharm school he held a pharm. tech license and moonlighted for extra cash.

Retail in CA four years ago was paying $40k to $50K three year sign on bonus if you worked the central valley.

Pharmacists……if there is a bigger “I’m in it for the money” job, I’d like to know what it is.

About everyone I know who is in college is either working on an RN degree, or Pharmacy.

I think I smell the next bubble.

Maybe “I’m in it for the stabilty.” Even the useful degrees like engineering/accounting can be oursourced.

Even the useful degrees like engineering/accounting can be oursourced.

I’d say engineering and accounting are particularly well-suited for outsourcing.

“I wouldn’t say I have a passion for it, but I am smart enough to understand it most of the time and I do have a passion for solving problems”

I’d say these statements aren’t compatible. IT is all about solving problems, that’s what makes it so interesting to me; figure out a new and efficient way to do something, and do so without the 10 year lead time that it takes to see an idea come to completion in many other engineering disciplines. Imagine figuring out a new way to build an airplane wing. How long before you see that idea actually implemented? Now, imagine figuring out a new way to render a webpage. How long to see that idea on every computer/phone across the world? That’s what makes the “soft side” of IT so engrossing to me, you can test your ideas and model ideas/solutions so much faster than you can in just about any other engineering field.

I’m not in IT. I’m an EE that writes embedded firmware.

I think that what Carl means is that while he enjoys the satisfaction of solving a problem or creating a solution for a customer that he isn’t “turned on” 24/7, like some people are. Like those people who after putting in a 12 hour day at the office go home and work on some open source project until midnight every day.

Yeah…I’m not one of those people. That time gets spent here trying to learn things that don’t make sense to me from people like FPSS :-).

I’m in this weird situation because I wouldn’t say I have a passion for it, but I am smart enough to understand it most of the time and I do have a passion for solving problems and getting product out the door and into the hands of customers.

I’m the same way, Carl. And it affords my lifestyle out of work…

My parents volunteer with seniors on regular Social Security who are living on $800 a month. And in MA where you need heat for a good chunk of the year. They send a lot of them to the church food pantries after they help them with their Medicare part D enrollment.

Which is what I was talking about the other day when somebody said no, companies look at the long term all the time. To me, this is short term thinking.

Actually, HP stayed fairly true to the HP Way until both Bill and Dave were pushing daisys up. Their heirs, who inherited control of the H & P families now minority shares lacked the “gravitas” their father’s had and were unable to stop Carly’s leading HP down a path of destruction. Once Hewlett died Carly threw the HP Way out of the window.

Dave Packard was opposed to growth for growth’s sake. He mentioned in his book that he and Hewlett passed over many opportunities for quick growth. In his own words, he said: “More big companies die of indigestion than starvation.” He also mentioned how he dropped his guard once, when he allowed HP to acquire Apollo Computer, and how that had been a big mistake.

Corvallis is down to about 2000 here in Oregon after a high of over 7000 a decade ago. When I called on them in their heyday, I was told that for every HP employee, there were 3-5 people in Corvallis who called on them in one way or other. (engineering sales like me, landscapers, caterers, you name it)

Carly changed all that, and HP became controlled by the buyers and not the engineers. I would work on a spec with an engineer only to be told we had to figure out how to use something that was half the cost. So, either we lowered our price or had to settle for a lower spec.

To take this a step further, and sorry for politicizing this thread, I have several righty friends who keep complaining
about jobs but who, as hardline conservatives, are lining up behind….Romney. As diplomatically as I can, I’ve pointed out their hypocrisy and offer my Carly story (and how righties lined up behind her in CA even after knowing her history at HP) about how people like her and Romney offshore jobs and couldn’t care less about them. To no avail.

“(and how righties lined up behind her in CA even after knowing her history at HP”

Not only did she offshore everything in sight, she was fired for poor results.

I think HP is a goner. The printer golden egg laying goose is dying. Without it HP will whither and die as there is absolutely no innovation going on in company anymore, just “me too”, outsourced products. Under the current management the ink jet business would never had happened as they lack the patience and teh willingness to invest in the future. Unless there is payback in the immediate future they won’t do it.

And don’t forget she escaped with $20M. How much R&D could have been done for that price tag?

Corvallis used to be huge IJBU. Now they are working on things like home entertainment (?) and large scale OEM printing presses.

I once sold them $1.5M per year in product. Now I do MAYBE $50-100k per year.

I think HP is a goner. The printer golden egg laying goose is dying. Without it HP will whither and die as there is absolutely no innovation going on in company anymore, just “me too”, outsourced products.

I agree.

Back in the day, I worked in an office that had an HP Laserjet II printer. Thing was a tank. And it printed like nobody’s business.

These days, HP’s printers are cheap junk.

They took the Gillette route and went all out to sell ink instead of hardware. The buyer I used to work with is exclusively an ink trader these days.

You can get away with the Gillette approach when your product is superior. In HP’s case it no longer is better than the competition.

Oh, and learn two foreign languages.

Being fluent in Spanish has never helped me careerwise.

“Hedge all bets. Major in engineering, with a minor in business”

Colorado State U has a dual DVM/MBA program. Kind of makes sense as a lot of veterinarians run their own practices.

Being fluent in Spanish has never helped me careerwise.

I was thinking Chinese for the tech world, and Spanish/Chinese for the medical world. And both help with that other side of the brain.

This idea only applies to parents who actually give a sh*t about their kids’ futures and do actual parenting. Which is mostly a middle class, upper middle class thing (the 1%ers can just buy their kids jobs and admission to Harvard), as well as a minority of poor immigrants.

Consider that most of this country is on track toward Idiocracy. TeeVee and high fructose corn syrup do the parenting, resulting in the majority of this country being fat and uneducated. Most Lucky Duckies can’t envision anything beyond their next trip to McDonalds or who’s on Dancing With The Stars tonight, let alone their kids’ future “careers”.

I was thinking Chinese for the tech world

How ’bout those folks who studied Russian back in the day. Not so helpful now, huh?

New studies have shown that learning a language or instrument or any other brain cell boosting activity works better if coupled with exercise. By itself, those crossword puzzles aren’t going to help with memory retention.

I’ve been wondering where I can get a RFID for my glasses, wallet, coffee cup, and keys.

Agreed. And in my neck of the woods, Spanish, Chinese, AND even Russian would be helpful to know if working in a hospital. Plenty of practice.

Future career fields?

We can take our guidance from the African-American community, since they have been Lucky Duckies longer, and have figured things out a long time before us Dumazz crackers.

Boys = Sports. At minimum, you will get a free college degree, and if you don’t/can’t go pro, you can become a talking head, or get hired by a rich alum who wants you around for PR.

(A former female friend worked at a major law firm. One of the employees was a retired MLB player. No college at all. Tells baseball stories all day. Said his job description should say “Professional BS Artist”)

Girls = Professional “Skank”. The skankier, looser the morals/apparant self esteem, the better.

A dumb hot chick will go a lot farther than a high IQ average chick, 90% of the time. Either look around you, or turn on your TV to see hundreds of examples.

Self repect is overrated.

Funny X-GS. A masters in Snookie!

The Lucky Ducky community has figured out every line and loophole in the government cheese laws. That’s how they make their living.

Auto mechanic, electrician, plumber. Low stress jobs that cannot be outsourced and that allow you to grow as much or as little as you want. My auto mechanics have it great- a little old stone garage on the edge of downtown, all the business they can handle because of their location plus they’re honest and relatively inexpensive, they have a bunch of old cars and strange little go-carts that they’re playing around with when I pick up my car after work. Seems pretty mellow, and the harder times are the more people hang onto old cars needing repairs. Hell, my old Volvo and VW probably put their kids through college. (Never again!)

Auto mechanic, electrician, plumber. Low stress jobs that cannot be outsourced and that allow you to grow as much or as little as you want.

Delete auto mechanic (my former career) from that list. Unless you want to be a sidewalk mechanic, you gotta keep your skills up to date.

Many of my friends are/were tradespeople. We were all good in our 20’s and 30’s. But construction, auto mechanics, landscaping, etc. gets harder as you age. I got out of mechanics in my mid-30’s because I wanted to have kids and it was just too toxic.

it was just too toxic.

My guys wear plastic gloves- their hands are as clean as mine.

Yeah, you gotta stay up to date, but who doesn’t? I can’t argue with what I see. They have all the business they care to handle (in fact there are several brands of cars they refuse to work on, and they pretty much take only referrals as new customers), they’ve got music playing in the shop, cats sitting in the sunny windows with the plants, neat old cars they’re fixing up…seems pretty sweet’n'easy to me. I don’t see where any pressure would come from.

Came across the same thing when my car broke down driving to Florida. There was some guy with his own little shop, specializing in German cars(always a money-maker), in the middle of nowhere (Cleveland,Tennessee I think- very oil City), but he was just off I-75, in the most mountainous stretch of the entire highway (exactly where your car might finally reach its breaking point) , and he had quite a few cars in there. It was just him and another guy, and it seemed very similar to my guys’ setup.

Stockbroker. Not insurance broker.

You can also minimize insurance costs such as having high deductables on car and home insurance, skipping collision, etc. Only the most very basic. Health insurance is a tougher one.

Tough? 52 million already have NO health insurance and won’t be getting it anytime soon, if ever.

In addition to those 52 million, consider how many people think they are insured until they have a real medical event and get denied/dropped coverage.

“Health” insurance companies operate on the same sociopathic model of the Wall Street pigmen, and their pig executives are long overdue for a date with a lamppost and rope

Tough, as in taking the least expensive option when there is a choice. How many would chose no health insurance when they can afford it, or chose a crappy plan when they can afford a good one?

It’s easy to drop collision on a $3000 car when you can easily afford to replace it.

The workforce has 152 million people.

52 million of them cannot afford ANY type of health insurance. Hell they really can’t afford ANY type of insurance, period.

Why? Because of that 152 million workforce population, 72 million make $500 a week or less. That’s almost half of the workforce.

So the example of “tough” now only applies the other 80 million. Well minus the 1%s. So that now makes roughly ~70 million people.

So it looks like the 52 million number is in fact, outdated.

Guess what happens to a nation that can’t afford health care? “Maintaining an empire and increasing standard of living” is neither one those things.

I sold a piano and a gym school quality trampoline on Craigslist, and both sold quickly and at the price I was hoping to get.

As for jobs, it’s hard to say. My previous employer advertised on Craigslist a lot.

Depends on how good you are with your serch terms. And how good the ads are with including appropriate key words.

but, would you say craigslist ads are effective: defined as relevent, timely, and reliable?

My motto is: “If you can’t buy it used on craigslist, you don’t need it”

There absolutely is a difference. If you pay a lobbyist $1000 an hour to put together stats and charts and graphs and reports and the lobbyist manages to get it in the door at a Congressional office so some low level staffer reads it, that staffer may draft an outline for the Rep that uses your slant on the meaning of the numbers. It is incidious when only big business can afford the good lobbyists, but you can’t fault people for wanting to communicate with members of Congress about things that impact their business.

Political contributions are just giving money to the rep’s reelection campaign or to the party directly after a conversation with the rep (they are required to raise big bucks this way or face the wrath of the leadership) are a very different animal.

Good grief, lobbying expenditures *could* be on a properly conducted scientific study of something. Not that the information would get out if the results don’t support the position of the person requesting the study, but it could be.

You’re wasting your time, Polly.

Whether public policy is influenced by direct campaign contributions or indirect bribes through lobbyists is a distinction without a difference.

So putting together information about the evironmental impact of a particular farming subsidy is the same as a bribe? You are going to have to explain that one to me.

A lot of the lobbying that goes on in this town is nasty. It can just be a guy going to a rep’s office and dangling future donations. More often is is giving the donations outright along with a statement of where they came from and what those people care about these days.

It also can be similar to when I was on a project team writing some stuff [details deleted] and we had a few meetings with people who represented the different parst of the industry that was regulated. They told us what information the software systems their industry already used provided (and filled us in on some of the internal terms of art), so we could see if we could get what we needed without overly burdening them. We also got a big song and dance about how X is really part of Y and should be reported that way. We used the info that we needed, spent some time discussing the whole X is part of Y thing, decided we disagreed and rejected the suggestion (all this a vast oversimplification). Lobbying can be like that too.

It is, of course, much easier for lobbying to be similar to my example, if there was no money involved, as there wasn’t for us, but it isn’t impossible even with our system. A Rep could refuse to do the bidding of the party leadership, refuse to listen to anyone who gave them more than $100 (or represented anyone who gave them more than $100), plan on only being in office for one term, and try it. It would still be possible to communicate because e-mail and the internet and tweets are cheap. I’d like to see it tried at least once. But honestly it would be a lot of work and the people who want to be in Congress like the shmoozing or they wouldn’t be in politics to begin with.

I’m sure it’s all very legal per the jot and tittle of the law. But as Dick Durbin put it, if he’s got a hundred voicemails when he gets back to the hotel room, he’s going to take the ones from the big donors first.

Regardless of the nature of the lobbying expense it’s almost certainly highly directed to influence policy. Or else it wouldn’t be lobbying.

Here in Tucson, there’s a hip and trendy neighborhood called Dunbar Spring. And a railroad track runs right by it.

I’ve never understood what the attraction of the Union Pacific is. I mean, come on. I’m almost two miles away from those tracks, and there are times when the train sounds like it’s going through my living room.

Train horns are quite Andy Griffith-ish as a faint background noise. Otherwise, who in their right
mind would love to feel the rattle and hear the noise.

We’ve turned down some “good buys” and let other go for
it due to noise issues of any kind. We’re too damn old for that nonsense.

Train horns are quite Andy Griffith-ish as a faint background noise.

I feel the same way about fog horns. I love to hear them but not right out my window

I feel the same way about fog horns. I love to hear them but not right out my window

True story: When I was a wee little Slim, my family went on vacation to Nantucket Island. This was back when said island was still affordable for those who weren’t running hedge funds.

Any-hoo, we were renting a cottage in town, right by the harbor, and whooooooop! A very loud horn went off. I freaked out. Major tears, fear, comforting hugs of the motherly sort.

ISTR that it was a fog horn.

And a railroad track runs right by it.

We have a major east - west rail corridor right through downtown with a daily run of 12 to 18 heavy mountain trains of 120 plus cars and five engines that stretch for miles. They love to blow the horn long-n-loud as they pass through the center of town, but hey, housing costs are…

“Train horns are quite Andy Griffith-ish as a faint background noise.

Same here. We have to be outside and it has to be really still. Even the banjo music has become pretty much inaudible here, only 40 years after the release of “Deliverance.”

Trains are great heard in the distance, a nightmare anywhere closer. Remember that traintracks are often far busier at night- you can spend 2 hours at an open house and never have a train go by, but that first night after you buy, there may be one every half hour, roaring by so fast and loud that the whole house shakes, and no one can sleep through it. That’s a first night to remember.

I love the trains. They are close enough to shake the house a little and I love the rumble - puts me to sleep somtimes. BUT - no horns. Well every now and then a new conductor lays on the horn by mistake, but I can’t recall one ever waking me up.

I once rented a house next to railroad tracks. I never woke up for the trains.

I never woke up for the trains.

Then it was a slow spur. I know someone who lives next to a busy main track, those trains go by with incredible power, all night long. Ever stood on the side of an interstate when a semi roars by at 80 mph? Multiply that by about twenty to experience what the trains feel like. The entire house shakes. She’s lived there for years and says it still wakes her up.

MBA now or be priced forever!

Too bad I can’t “flip” my sheepskin. I’d be willing to part with it for $20K!

The University of Denver’s MBA program is 80 credits x $1062 per credit hour = $85,000.

I sometimes wonder who can actually afford places like DU or Regis?

Imagine coughing up 85K for an MBA and not getting a single job offer.

That’s easy to answer: The sons and daughters of the board of directors.

Many years ago, I was thinking of getting an MBA. And, wouldn’t you know it, I got a job at the University of Pittsburgh, which had a very generous deal on employee tuition.

My job consisted of annotating academic business and economic books. And, yes, that was every bit as exciting as it sounds. My biggest challenge was staying awake.

I was required to annotate quite a few books used in MBA programs. Man, I was bored!

So, in short, I decided not to go for the MBA.

My thoughts on an “MBA,” since it’s worthless anyway:

Find a decent biz school and visit their bookstore. Get the books for the MBA specialty you’re interested in and create your own MBA. Use the knowledge to demonstrate ability, put it on a resume. Granted, I’m sure most employers are looking for the acronym “MBA” on a resume but experience and demonstrated ability should count for something. A lot cheaper anyway…

personalmba.com

I like it. I have read few books mentioned there.

In 2007, I actually applied to 3 MBA programs. Took GMAT, did pretty well. Got accepted in one top 20 program, but at the last minute I bailed out. Turned out to be a good decision.

personalmba.com

I like it. I have read few books mentioned there.

I read the book associated with the above site. The part about why one should avoid going for an MBA was quite good. But the actual MBA course material bored me up one wall and down the other.

I sometimes wonder who can actually afford places like DU or Regis?

I’m surprised to hear the two in the same sentence…when I went to Regis it felt a little under-rated to me and nobody seemed to think Regis was at all close to DU in desirablity. I went in the late 90s and early 2000s and my employers paid for all of it. I didn’t think it was that expensive at the time. More of just a “well, guess I’ll go ahead and take some classes just in case it comes in handy someday” kind of thing. I paid for each class up front and then got reimbursed.

But the actual MBA course material bored me up one wall and down the other.

I actually kind of liked mine and the stuff I didn’t like was still good for me (the accounting and statistics type of stuff I’d always avoided).

So can Excel.

i know

“She was come-to-your-senses-ex-LDS”

Yep. I think it was only her fam back in Utahrr that was still practicing…

IIRC she was drinking a Terminator Stout. So not only a microbrew, but a pretty heavy one at that. Cheers, Oly!

IIRC she was drinking a Terminator Stout. So not only a microbrew, but a pretty heavy one at that. Cheers, Oly!

I’ll bet she also enjoyed The Devastator. That’s from Wasatch Brewing, which also offers Polygamy Porter.

During the first Depression many millionaires emerged by having bought shares so cheaply.

IIRC, one guy bought one share of every stock on the NYSE that was below 10$ during the depths of the crash, and made a fortune. Of course, he was some insider stockbroker type.