Whatever Became Of Those Green Shoots?
Readers suggested a topic on the current economy. “Whatever became of those green shoots?”
A reply, “Ah, the failure of ‘Capitalism’ (note that it’s between quotes, lest I be accused of being a commie). Never has the world created so much wealth (goods and services) while those who produce it simply cannot afford the fruits of their labor (I wonder why?) Meanwhile, war on the middle class continues. Bug, meet windshield.”
One said, “Will the engineered low inventory and low interest rates will create a trend? Will people forget the underwater scenario and start another bubble? Lender Appraisers are told to inflate or get fired. Remember when they tried listing price ranges, and that trend seemed to die. Debt is just a 4 letter word.”
One posed this, “How about a topic that lists the 10 single biggest causes of the state of affairs in America today regarding the lost of the middle class and the stability of the long term systems. Number one would be the greatest cause. The list should be brief and to the point or summed up in one sentence for each of the 10 causes.”
Another reply, “#1. Bottomless Stockholder Maw (DOB ~1978). We used to be satisfied with 6-7% ROI, which could be earned solely from simply running the business. The BSM wanted 10% profit, so each year a company had to find 2-3% more by cutting costs. Everything leads from that.”
To which was said, “By the late 90s they wanted 20%. The company I was working at then got out of a stable profitable business that couldn’t generate 20% and into something unstable that might generate 20+% in order to please BSM. They no longer exist as a result of that decision, but a small twice-digested slice still lives on.”
And another, “1- Outsourcing of U.S. manufacturing base, cheaper sh*t from China = jobs go bye-bye. 2- Financialization of U.S. economy, financial economy instead of enhancing/enabling main street economy becomes the actual economy. 3- For-profit ‘Health Care’ system consumes 20% of GDP while delivering worse results than other nations with single-payer systems (should be discussed in terms of economics, not framed by American political R vs. D arguments).”
“4- Illegal immigration from Mexico and Central America. Consider impact of adding 20 million mostly poor and uneducated Lucky Duckies to U.S. economy and wages for construction, service sector, et cetera.”
The Wall Street Journal. “International Monetary Fund head Christine Lagarde said Friday that the IMF will cut its global growth forecasts in the next month, adding that a weaker global economy will bring more trouble for Japan in the form of a stronger yen. The world economic outlook will be ’tilted to the downside,’ Ms. Lagarde said at a news conference in Tokyo. ‘Tilted means there’s not an enormous variation, but it’s a negative variation,’ she said, without providing any figures or details of which regions would be affected.”
From CNBC. “Uncertainty about U.S. fiscal policy, Europe’s sovereign crisis and slower global growth have turned the U.S. economy into what feels like a slow-moving zombie. CRT Capital Senior Treasury Strategist Ian Lyngen said the economy feels zombie-like. ‘The risk taking animal spirits have yet to return,’ he said. ‘The U.S. economy has been unable to achieve escape velocity but the amount of monetary and fiscal stimulus in the system has proven adequate enough to keep it going at a 1-2 percent GDP pace. That is slow by historic recovery standards…it feels like a ‘zomb’-economy,” said Lyngen. ‘People are increasingly worried about a double dip,’ he said.”
“‘It feels like it’s sleepwalking,’ Moody’s Economy.com chief economist Mark Zandi said of the economy. ‘We’re walking but not going anywhere fast. I don’t think we’re dead like a zombie. There is some life underneath, but we are sleepwalking.’”
“Economists call it ‘escape velocity’ - the ability of a slow-moving country to finally hit a speed beyond fits-and-starts and into a durable recovery. Trouble is, the U.S. isn’t there yet, even three years after the end of the last recession, and judging by Friday’s jobs report no closer to getting there than it was two years ago.”
“In all, the housing market, considered by some to be the final lynchpin to economic recovery, is far from escape velocity and its improvements are not enough to lift the broader economy.”
“Though it seems that every weak economic sign or stock market downturn brings calls for more central bank easing across the world, people have begun wondering how effective these measures really are. After all, with interest rates in the U.S. near zero and other global central banks getting there as well, how much lower can you go, and how much more can it help?”
“Fed critic Michael Pento at Pento Portfolio Strategies said the U.S. central bank ought to get out of the way and let rates normalize, though he doubts it will happen. ‘There is nothing that can be benefited economically from lowering rates from here on,’ he said. ‘The only thing you will do is levitate asset prices and send commodity prices soaring. That is not the prescription for what ails this economy.’”
The Calgary Sun. “Since the beginning of the Great Recession in 2008, the central banks of major industrialized countries have been keeping interest rates unusually low to ‘help revive the economy.’ The low rates, coupled with the massive money creation engineered by central banks (what is referred to in the jargon as ‘quantitative easing’) are giving economic factors the false impression that there are a lot of savings around to be borrowed, when that’s actually not the case, or not as much.”
‘Saved resources are those set aside instead of being immediately consumed. Printing pieces of paper with dead politicians on them cannot, logically, add real savings to the economy.”
“In Canada, households have reacted to these low rates by getting deeper into debt. At a level surpassing 150% of disposable income, we are actually more indebted than Americans were just before the crisis. And there is increasing talk of a real estate bubble. There’s also talk of bubbles in various other sectors of the world economy, but certainly the biggest bubble of all is the government sector bubble. Government spending has been up, up, up, almost everywhere for the past five years, and most of this new spending is paid for by debt, made easier by central banks.”
“The main debate right now in Europe is which governments are going to have to be bailed out - with money that other governments don’t really have, of course, and that will also ultimately be created out of thin air by central banks. So, essentially, what central banks have been doing with this low-rate policy is encouraging everyone to spend and pile up debt, while discouraging us to save. But they’ve patched up the lack of real savings by creating phony savings.”
“Anyone with two cents of common sense knows that this cannot be a solid foundation for a sound economy.”
“Will the engineered low inventory and low interest rates will create a trend?”
I enjoyed a mini-reunion of my FIL’s side of the family last night. Was enjoying my dessert and talking with the wife of one of my spouse’s first cousins about the travails of raising teenagers when I overheard said first cousin in a kitchen conversation about lenders holding inventory off the market ‘until prices come back.’ Turns out he is an IT guy for a homebuilder. I found it quite interesting to hear a home construction industry insider casually strike up a conversation about shadow inventory at a family gathering. We agreed that artificially propping up prices works well for homebuilders, not so much for Realtors®, who face a dearth of sales transactions.
“Remember when they tried listing price ranges, and that trend seemed to die.”
Dumb ideas are predestined for the dustbin of history.
‘We’re walking but not going anywhere fast. I don’t think we’re dead like a zombie. There is some life underneath, but we are sleepwalking.’
What lies beneath…heh heh…
‘Zandi doesn’t think the sluggishness implies a recession. ‘We’re at a 2-percent economy. It doesn’t feel good,’ he said. Zandi said one positive is that businesses are basically healthy and while there is a lack of hiring, there is also a lack of firing. ‘The only ingredient missing is confidence,’ he said.’
Yesterday a poster mentioned that there weren’t too many professional economists on this blog. There was a discussion I had with a reporter recently where I explained how what central bank economists and others like Zandi talk about is more like witch-doctory than economics I studied in school.
Notice how they are usually talking in terms of baseball, or botany, rather than the actually subject matter. And they like to end it with something like, ‘the only ingredient missing is confidence’. See, if you people would just believe! And when their policies fail, why we just didn’t sprinkle enough dried bat’s blood onto the mix!
“If you people would just believe!”
“Ommmm.” So far, it doesn’t seem to be working!
“2- Financialization of U.S. economy, financial economy instead of enhancing/enabling main street economy becomes the actual economy.”
Which presidential candidate better embodies point #2 of America’s road to perdition?
Is this a trick question?
“The world economic outlook will be ’tilted to the downside,’ Ms. Lagarde said at a news conference in Tokyo. ‘Tilted means there’s not an enormous variation, but it’s a negative variation,’ she said, without providing any figures or details of which regions would be affected.”
The weird thing about paying attention to announcements like this is that the average American has no clue about what is coming down the global economic pipeline. I feel stuck between suppressing my advance knowledge of a looming second leg down in the Great Recession, or enjoying the reputation of a Cassandra.
“Saved resources are those set aside instead of being immediately consumed. Printing pieces of paper with dead politicians on them cannot, logically, add real savings to the economy.”
Heresy!
Printing pieces of paper and low interest rates are what these people have been doing for a while now. The question for me is, what happened to the activities that did add real savings to the economy? Then one begins to think; what changed about the same time as this whole thing started looking like a ponzi scheme?
Well, a consumer based economy. And that happened because? Globalism! Now that’s heresy!
But yeah, let’s all stare at the ticker going by on the TV, while talking heads interview one person after another, asking ‘will Bernanke do this, or will he do that?’ As if the Fed can do a damn thing about this mess when they helped create it in the first place.
‘Fed watching’ is what the media does instead of asking real questions.
“‘Fed watching’ is what the media does instead of asking real questions.”
Gathering viewers is what the media does. Gathering viewers gathers ratings which in turn gathers advertising revenues.
Without all this gathering the media in question would vanish and its alloted channel and time slot would be set aside for another media. So to keep all this gathering gathered the media needs to tell it’s gathered flocks what they want to hear.
Not what they NEED to hear, what they WANT to hear. If they were given what they needed to hear then they would stop listening and would then tune to another media.
My concern is this is getting serious. Too much is at stake to worry about ratings.
‘In Canada, households have reacted to these low rates by getting deeper into debt. At a level surpassing 150% of disposable income, we are actually more indebted than Americans were just before the crisis. And there is increasing talk of a real estate bubble. There’s also talk of bubbles in various other sectors of the world economy’
Oh yeah, those pesky bubbles. Do these ‘economists’ look much at what might happen if Canada, China, India (most of Asia actually), Australia and others all have their real estate bubbles collapse at roughly the same time? What they do talk about is, ‘will China engineer a soft landing.’ I don’t think it’s possible to have a soft landing from a really large asset mania.
I thought combo made a great point the other day when he said ghost towns used to be left after an economy collapsed and now it precedes it. It gets to the heart of what is different about what we are facing today.
“Gathering viewers is what the media does. Gathering viewers gathers ratings which in turn gathers advertising revenues.”
Thanks to the PR efforts of Easy Al and Market Whisperer Ben, Fed watching has become a spectator sport, which makes it fair game for the MSM ratings chasers to report.
J. K. Galbraith once said something about economists answering economic questions not because they knew the answer but because they were asked the question.
These talking heads do the same thing; Ask them a question - any question - and they will come back with an answer. But some questions are unanswerable so a truthful answer should be “I don’t know”.
But these guys can’t say “I don’t know” because they are talking heads and thus they are annoited by the networks as “experts” and as experts they should have the answer to every question that they are asked. So answers -accurate or not - are what we get. If they say “I don’t know” often enough their status as talking heads will be yanked away from them.
Mark Twain (paraphrased): “A person who does not read a newspaper is uninformed. A person who does read a newpaper is misinformed.”
And the Greatest Talking Head of them all is Donald Trump, a man who has the answer to any question, even those that are not asked.
Bloviating blowhard…
More like a flaming Ass-xxxx….Born with no legacy money, Trump would be at best a marginal salesperson only due to the fact that he has a big fricken mouth…
they are annoited by the networks as “experts” and as experts they should have the answer to every question that they are asked.
My old private sector company had a department which provided support to expert witnesses. I was told that above all, the company was NOT supposed to do experiments or even suggest them to the legal support. If you needed to do an experiment, the opposing attorney will tear you to shreds. Expert witnesses are supposed to know everything, not do experiments to discover things.
No creative destruction is allowed at the top of the food chain, where it is most desperately needed.
“In Canada, households have reacted to these low rates by getting deeper into debt. At a level surpassing 150% of disposable income, we are actually more indebted than Americans were just before the crisis. And there is increasing talk of a real estate bubble. There’s also talk of bubbles in various other sectors of the world economy, but certainly the biggest bubble of all is the government sector bubble. Government spending has been up, up, up, almost everywhere for the past five years, and most of this new spending is paid for by debt, made easier by central banks.”
The planktonization of the Canadian household sector seems to be coming along well. Megabanking whales with lines of business that target Canadian household-level debtors should soon have an ample stock of forage to feed them!
Canada need not worry. Everyone wants to live in an icebox 9 months a year.
“The main debate right now in Europe is which governments are going to have to be bailed out - with money that other governments don’t really have, of course, and that will also ultimately be created out of thin air by central banks.”
It’s turtles all the way down.
“The main debate right now in Europe is which governments are going to have to be bailed out - with money that other governments don’t really have, of course, and that will also ultimately be created out of thin air by central banks.”
I loved this money-quote too, PB. It highlights that the hunt for the ultimate bag-holder continues; governments bailing out other governments with money that they don’t have either, funded by the ECB or coordinated action by many central banks.
Why don’t we just pick those holding worthless debt as the bagholders, and let the economy get about its business? Without the uncertainty spawned of the bagholder hunt, and the drag of all the unserviceable debts, it would do far better.
Unleash the creative-destruction dogs!
p.s. Love the “turtles” line, btw; it’s one of my favorites.
There are many causes for the current state of affairs ,but I tried
to think of the major ones .
It’s hard to put these in one sentence but I was torn between number one cause and number two cause ,because they are pretty equal in
what their effect was and they feed on each other . This includes the
Globalism of financial markets .
(1)Rise of the Corporate Monopolies with their outsourcing and out manufacturing ,and globalism and trade designed to pad the pockets
of the one percenters .Further, the growth of the Miltary complex
for the purpose of aiding and abetting those Monopolies .
(2) Elimination of the 1929 depression reforms and regulations ,such as the Glass -Stegal act, that brought on the creation of derivatives,
credit default swaps ,without transparency or meaningful capital requirement to pay on claims . This created the Global debt bomb
and creation of bubble markets or false sense of risk . The merging of
commercial banks with investment banks and total disregard for that conflict of interest position .
(3) THe Politicial lobbying system which insures that Monopolies of
Power and wealth ditate policy and laws and regulations ,and what and who the taxes collected would benefit .
(4) With the creation of the cash cow of Medicare ,along with the
rise of a price fixing monopoly medical care insurance system ,came the corrupted rise in dangerous Pharma drugs ,useless medicine , useless vaccines ,which in effect
created a hijacking of the medical care system in favor of increased
profits for Pharma and insurance and health care workers ,at the expense of real health for Americians . Its unsustainable ,not only in terms of costs ,but in terms of it being quackery .
(5) Using tax revenue to prop up non viable businesses or public services ,while giving tax breaks to Rich Corporations or benefits
at the public expense ,or cleaning up any damage at the public expense .In general ,abuse of public tax funds collected with increasing moves to have less accountability on the part of Business ,or government services .
(6) The absoulte ignoring of the RULE OF LAW ,while its replaced with deal making or low penalities ,while violating industries factor in that the low penalities are just a cost of doing fraudulent business .
(7) The control of information and the suppression of trueful information to the public . Also the moral decline of the population .
The majority populations failure to take personal responsibility for their actions ,health ,and duty to be a good citizen .
(8) Inproper distribution of resources and investments World wide
based on the creating of the New Age Financial Systems ,that has turned into casinos . This includes inproper wages and benefits to
meet the growing inflation of prices on Monopoly business .
(9) Failure to create cheaper cleaner energy sources and to much monopoly controlled reliance on oil and dangerous industries if your talking about necular .
(10) The United States spending to much money on Military trying to
control the World ,while at heart having the motive of protecting the interest of Big Business .
#1 Free trade. With wages varying by an order of magnitude, increased efficiencies ensure trade imbalances.
#2 Embracing trade imbalances. Trade imbalances, where one entity borrows fiat money into existence and spends it to fund trade imbalances, permits other entities to accumulate mass sums of this fiat money. Rather than resisting the accumulation of mass amounts of money into few hands, that became the goal.
Everything else flows from these first two.
#3 Too much wealth in too few hands.
#4 Too much debt, that can’t be repaid unless those with the more spend it.
#5 An economy plagued with trade imbalances, must fund them on increasing debt, forcing ever lower interest rates, ever looser lending standards, and debt ever increasing at a pace faster than sustainable.
#6 Loose lending pushing cheap money creates asset price bubbles, from which the few become ever richer and the masses eat massive losses in the inevitable crash that follows the boom.
#7 Eventually, lending hits the wall where new debt can not continue to be created at an unsustainable pace. People paying the interest on their current debt, by taking on more debt, go insolvent when they lose access to unlimited amounts of new debt.
#8 I think the PTB very much desire to inflate our way out of the current excess debt situation. The problem is that money is in too few hands to make inflation sustainable. We can pump more money to Wall Street, and they can use it to bid up commodities futures. However, with insufficient money on Main Street, rising prices simply means falling demand, creating a glut of excess commodities, undoing the inflation attempts.
#9 Looming unfavorable demographics. SS is built on each generation being 20-30% larger than the previous. GenX ix Smaller than the boomers, and GenY which was supposed to be 50% larger than the Boomers is only the same size.
#10 The PTB fought the baby bust by turning a blind eye to illegal immigration. I found it interesting that last week, in the same bits buckets, there were conversations on how GenY being as large as the Boomers would be the salvation of Boomer retirement…. and laments as to how turning a blind eye to illegal immigration is destroying the country.
Yeah, I hate what we have done in immigration enforcement, but if you can’t see the link between millions of people coming here illegally, and having a birth rate almost double that of native born, being the force that ended the baby bust, then you just aren’t paying attention.
Does anyone else on the planet agree with your doctrinaire belief that free trade is the root of all economic problems?
I personally hope not, as the Wealth of Nations would decrease a lot if your crackpot ideas ever took hold among the masses.
It is not free trade per se. Free trade with nations on similar labor and resource footing such that the trade is balanced, is a great thing.
It is the trade imbalances that I see as the root of economic trouble, and it doesn’t matter if it is internal or international.
Trade imbalances can only persist as long as those on the deficit side of the imbalance are going into debt, creating fiat currency at unsustainable rates.
We screa
We scream at people to stop spending more than they earn, without accepting that is the necessary pre-condition to funding trade imbalances, international and domestic. If people stopped spending more than they earned…. well, that is what was forced on them in 2008, and we saw how that was going until the government stepped up with the $1.3T new fiat currency generation needed to make our trade imbalance plagued economy continue to function, at least for a little while longer.
I forgot about the Fed printing of money and the Ponzi scheme of the need for increase in population to support older generations . With
7 or so billion people in the world ,additional population isn’t sustainable at higher levels of income or product consumption
There’s also the petroleum depletion wall. It’s physics, not opinion or political orientation. For something to move or grow, it must have access to energy. That applies to every mass of air, mass of liquid, plant, animal, vehicle and machine on the planet. Our civilization is almost entirely fueled by petroleum. Petroleum’s distillates (diesel, gasoline and kerosene (”jet fuel”)) make 99.99% of our vehicles move, which enables 99.99% of commerce. That means FOOD.
Post-petroleum civilization can’t support 7 billion people. They might survive if land became totally reformed and was parceled out in grow plots so that 7 billion people won’t starve (and it’ll be probably be 9 billion by the time of petroleum-use collapse). But land reform like that is impossible. It will invoke massive wars. So billions have to die in a fairly short period of time. There’s no getting around it. Humans are driven by greedy economics and choose war invariably over losing property even when starvation looms.
So true what you said Better Renter .
I also subscribe to the Peak Oil theory. It was cheap and abundant fossil fuels, with a favorable EROEI, that enabled the growth of suburban America. I expect everything we have associated with development since 1945 to go away, permanently. The states that have benefitted, especially Florida, are going to depopulate substantially.
While I don’t wish for this outcome, it’s quite possible that several billion people will die as the nations of the world try to perpetuate what cannot be perpetuated. I read one writer who said that, with respect to the resources that sustain life, humanity is no better able to control itself than bacteria in a petri dish.
One reason I usually am in a good mood, except where the housing bubble is concerned, is that I know that the future is going to be unpleasant compared to today.
One reason I usually am in a good mood, except where the housing bubble is concerned, is that I know that the future is going to be unpleasant compared to today.
And that is a reason to be in a GOOD mood in your book??
He’s enjoying the good times while they last.
Snake charmer, we understand the problem. But I wish people would stop calling Peak Cheap Oil a theory. Production peaks from limited resources isn’t a theory. It’s hard physical fact. We don’t call it the “theory of gravity”, for example. Some things are too hard true to be merely theories. It’s the LAW of gravity. Similarly, Peak Cheap Oil is a LAW. When you have a limited resource, your production of it will peak, then decline. Consumption of it will necessarily follow that curve; after all, you can’t consume more than that’s produced.
About the only way that production will not peak, is when the resource is everywhere, just for the taking, like air. Compressed-air supplies, for example, will never peak for a lack of air to compress. (There are other constraints on compressed-air supplies.) But that’s not petroleum. Petroleum is buried in a range of deposits, and eventually you deplete the ones which are more easily exploited, like Pennsylvania and Baku. It only gets more difficult to find deeper deposits, smaller deposits, and deposits in bad locations like the Arctic. And eventually you deplete those, so you end up ultimately chasing deposits that are combinations of those. The final deposits will be very deep, in the Arctic, and a few tens of thousands of barrels in size. Each barrel won from those hardest deposits will cost $1000.
And by then, our highway system will be a crumbling ruin, since no commuter will afford to drive like that. A lot of our roads will downsize. Petroleum will be solely reserved for the military. Most people will have to walk, ride a bicycle, or use a horse. A minority will have electric vehicles.
(Not to preach to the converted. Bye.)
+1…Nice commentary…
I know that majority of you here don’t like “there was a wait at Applebee’s” ground-level reporting, but Pinellas County is still raging like it’s spring break. I don’t recall a 4th of July as busy as last week’s… the traffic is unreal.
Perhaps I’ll get to live out my prime working years watching the remnants of America’s middle class take one last Disney vacation or a week at the beach.
I love the Applebee’s wait time barometers of the economy. Remember how well that worked out for Eddie’s Atlanta RE investments?
Applebees closed a couple of months ago here. Totally out of the blue.
Maybe because people in Boulder prefer to eat real food?
Yes…Boulder people tend to shun J6P food. But it’s a decent sized town, there are plenty who don’t. It was just strange that it closed with no warning. Normally there are signs that it’s going to happen…like nobody eating there. I wonder if maybe there was a high demand to do something else with that piece of land. In which case I could see Burger King and McDonalds being gone soon, too, since they are next door and all were in the path of the 29th St. Mall improvement path…
Boulder is plenty big for an Applebee’s…Plus, its a university town which Applebee’s loves…How old is the building ?? Has there been a major traffic shift in this location…My guess would be they will pop-up in another location…
The major shift in the area is the old mall dieing (which they survived) and the new outdoor mall/center being built on the same site. They weren’t super busy, but they were busy enough to survive in most locations. Whether they went belly up or sold out, in either case it’s due to the value of the land they were sitting on due to its location.
In this case I don’t believe they will pop up in another location, due to the Boulder prejudice against anything that J6P likes, plus you can always drive 8-10 miles to get to one outside of Boulder. Same thing happened to Chili’s in the 08-09 timeframe and it’s gone.
I’ve been to Appleby’s twice in as many years, with no wait either time due to all the empty tables.
Applebee’s = nasty.
I have to agree, but my family likes it.
bingo. Applebee’s is gross. Same with Ruby Tuesday, TGI Friday’s, and Chili’s. Good riddance.
I like that kind of empirical reporting. I look at Apple’s parabolic stock chart, and think about shorting it, but every time I go into the Apple store at the mall it’s absolutely mobbed. On the other hand, whenever I go into a Neiman Marcus in the same mall it’s usually empty, in the men’s department anyway, and the sale racks are always prominently displayed.
One thing I remember about 2007-08 was that I started seeing multiple vacanies in almost every strip mall, including anchor tenant spaces that used to be occupied by supermarkets or home furnishing stores. I think less than half have been filled.
The U-Haul Index is even better.
Yahoo: 4 Reasons the Economy Can’t Hit ‘Escape Velocity’
“…and factory orders are surging.”
LOL!! Dr. Paul Joseph Goebbels was right.
CNBC: Signs We Are Approaching a Zombie Economy
“Zandi said he expects things to improve after the election. “I think Europe is going to hold together. I don’t think they’ll let it unravel. I don’t think policy makers are going to take us over the fiscal cliff,” he said.”
Germany will likely be threatened with a trade embargo if they refuse to make the European bond holders whole again. Fugg’n greedy investors are like America’s poor, they don’t believe in consequences. Now move on before ‘ya get dumped in a common grave.
CalgarySun: Why low interest rates not necessarily a blessing
“In Canada, households have reacted to these low rates by getting deeper into debt. At a level surpassing 150% of disposable income, we are actually more indebted than Americans were just before the crisis. And there is increasing talk of a real estate bubble. Finance Minister Jim Flaherty just announced another tightening of mortgage rules.”
Canada’s current generation of subjects are doomed; like the stars in the night sky, they’re already dead, but you can still see the light.
There’s a great view of Jupiter and Venus (brightest) in dawn’s easterly sky.
Here in Central Maryland, construction seems to be going verrrry slowly on projects that could’ve been finished in a year or less during the bubble. We’re talking about townhome “communities” in the suburbs of Wash DC/Baltimore with 100-200 units. Sizeable but not small places. Construction drags on for years. For example, they’ll build 2 or 3 buildings with 4-8 units. And then they’ll try to sell some at x price. And, since they don’t really sell at that price, they build very very slowly for the rest of the units. Keep in mind, this is in the suburbs of 2 pretty good job markets in a state with high average incomes (highest in the country, I believe) and a diverse, educated work force. So, even here these new crappy townhomes aren’t really selling.
The places seem to generally be 1500-2400 sq ft, usually with a garage on the lower level and 2 or 3 levels above this. Depending on the level of “luxury” touches (LOL) pricing seems to be $140-180/sq ft.
I will note that the places I’m talking about really have no “community” aspects at all, other than they maybe have a community pool at the back of the property. They are located off of major roads (US-1 for example) that are full of traffic nearly 24 hrs/day. And they’re surrounded by industrial parks and other not-so-nice areas within just a mile or so. And, of course, to build the developments, they generally remove almost all the trees. I hate how these places look. And they could never really be more than a starter home–the terrible location, the fact that they’re crammed into a tiny area row-after-row makes them feel tiny even if they are technically a good sq ft size, and I can’t imagine people after age 50 wanting to live in places where you have to go to a different floor of the house for each function (i.e. kitchen, bedrooms, office/laundry, and garage all on different floors).
People don’t want this crappy product anymore. The only reason people buy this stuff is because they feel (wrongly) that prices will appreciate and they’ll be able to sell it in 5 yrs and buy a “real house”. But LOL @ the notion of selling a crappy generic townhouse in Laurel or Savage, MD and then buying a “real house” in a nicer area like Ellicott City, Cockeysville, or Bethesda. Not going to happen.
Meanwhile, near my neck of the woods in the wealthier outer areas (Darnestown), the idiot builders are advertising luxury two-car garage townhomes from the $500s. who is buying this stuff? I could find quite a few gorgeous homes much closer in for about $550K to $600K. But to be fair, there is some office sprawl in that direction, so I guess you could live there without much of a commute. Not everybody commutes to downtown.
I am in need of some HBB advice, real: in ground pools. My mind tells me — avoid doing this (!) but I’m wondering if I should cut myself some slack.
My wife and I love to swim–I use it to exercise because I don’t want to run every day and because humidity/heat here in summer make walking along the inner harbor somewhat uncomfortable. I love lap swimming, I swam from maybe age 7 up through college competitively. And my wife is a teacher who has 3 months off in summer and likes the pool–the MD/DE beaches are about 90 min trip, so pool makes more sense. We belong to a pool that is moderately priced, but I was thinking about seeing about an in-ground pool for the back yard. I am very financially conservative so part of me thinks–avoid the expense and maintenance.
The other part of me says, well, we plan to live in this house until we need a nursing home or leave the house in a pine box. We’re 30, so that could be 50 yrs. So my question is, am I right that pools have a lot of hidden costs? Or could it make sense for someone who legitimately loves swimming and plans to use it for a very long time? Thoughts?
I’m a swim fanatic. Used to be in masters swimming and I now put in over two miles every other day. I have been swimming regularly since my mid-20s in the mid-1980s.
I take it that you are in the Baltimore area (Inner Harbor). I lived at White Marsh. If I recall, there is a Merritt complex in Canton with an indoor and outdoor pool. The Merritt downtown has an indoor pool. I never swam when I lived in White Marsh (took thirteen months off from swimming). But I was closest to the Merritt in Tyson and could have gone there.
My folks had an in-ground pool. They quickly found they regretted it because they were afraid a neighborhood kid would crawl over the fence and drown. This was back in the 70s/80s in California. In Phoenix where my current base address is, child drownings are very common. Not sure how many of them were kids who belong to the households with the pool and how many were kids who hopped the fence.
I would look into umbrella insurance policies first if I was determined to have a pool and plan to leave it unwatched for any period of time. Lawsuits!
I go to the pool down in Canton that you speak of now. As you mention, swimming can be great exercise and having one at home would be an interesting proposition. I’m planning to live here a very long time so… we’ll see. I’m not in a rush, but it has been something I’ve been thinking about.
How did you like the White Marsh area? I don’t really like WM–too far from the city, very car-dependent, and most of the affordable housing there is attached product built by Toll Brothers, NV, Hovnanian, etc.
I liked the area pretty much. I liked the microbrewery (Red Brick Brewery). I had a relative who lived near Canton a year after I left. We are west coasters so I encouraged that relative to move back to California. Unfortunately, that relative preferred the job in Maryland far more than the current one in California. I got the guilts.
A pool is a consumer product , but will keep on costing . about like a new car payment will , and it will never stop , and adds exactly zero to the resale value . That said , sure , go ahead if you will use it , but keep it small , as that does cut down on the upkeep , and they do make very secure and very strong covers for smaller pools , for that last ring of defense , against an all time nightmare of a kid ,any kid’s drowning.
How about one of those endless pools that you could put a cover over?