Bits Bucket for August 16, 2013
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
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I’m catching wind of bubble mania in the conversations of random people again. I remember similar things happening around 2004-2005. I was eating in a restaurant the other night and the couple next to me was talking real estate. The woman was saying, “I’d be happy to pay $15,000 over appraisal.”
I’m also browsing rentals in the DC area and I have to say there are more properties available than I’ve ever seen. When you look through craigslist you can easily see several people posting floods of properties all at once. 20-40 listings from one guy, all in the same general area, with cheesy property management company names. These are usually properties in areas that were hard hit by foreclosures just a few years ago. the ex-urbs, as they call them. This isn’t going to end well.. again.
Two thoughts on this.
1) It’s amazing that people forget so quickly.
2) The US is on bubble 2.0 when Canada and some other places haven’t even popped 1.0.
Another thought:
3) People who balk at paying higher prices for consumption items are willing to jump right in and pay higher prices for investment items.
“I’d be happy to pay $15,000 over appraisal.”
I bet she wouldn’t be happy to pay a higher price if she were looking to rent.
She is also confusing “happy” with willing.
hehe
I bet she wouldn’t be happy to pay a higher price if she were looking to rent.
Because she’s counting on some “sweet appreciation” along the way, maybe 100K or more. That’ll pay for a new Lexus SUV and some nice vacations … if it happens.
Apparently she hasn’t learned that houses always depreciate…….. but she will.
“It’s amazing that people forget so quickly.”
I think it’s more that most people were completely clueless about the causes and effects of the raging mania which temporarily halted in the 2008-09 period but is now once again in full swing.
most people were completely clueless
& still are. In 2007 they were cruisin’ for a bruisin’ and are now foolin’ for a schoolin’.
the raging mania which temporarily halted in the 2008-09 period but is now once again in full swing
I wouldn’t say it’s in “full swing.” There are plenty of markets in this bubble which the appreciation fairy is passing over. This time around location is much more important.
You’re right, and I openly acknowledge that far too much of my time is spent in coastal San Diego to have anything approaching an unbiased perspective. For instance, I don’t spend much time in Compton, Richmond CA, Detroit, Cleveland, Gary IN, or any number of other inner city black holes where prices already have permanently cratered.
“I think it’s more that most people were completely clueless about the causes and effects of the raging mania”
Also the fact that it went on for so long (some would say starting in the ’80s), it began to seem normal. Many probably see the crash as an anomaly. And since so many view housing as an investment, it’s easy for them to view it like they would the stock market: if the stock market falls 50% and it appears to be gaining footing, it’s “time to buy”.
The woman was saying, “I’d be happy to pay $15,000 over appraisal.”
That’s beyond dumb.borrowed.money.
“That’s beyond dumb.borrowed.money.”
Nevertheless this is the money that is bidding up prices. As long as money is supplied to finance higher prices - whether it’s dumb.borrowed or not - then prices will go up.
And - rational or not - it seems to be considered by most people to be in the national interest for prices go up.
There aren’t enough transactions to “bid up prices”. Besides, it’s the median and we all should understand what that implies.
Nevertheless this is the money that is bidding up prices.
Agreed. My coworker had 4 offers on her Arvada house. One was $25K over her initial asking price.
So that’s the story she told you huh?
considered by most people to be in the national interest for prices go up.
Only for some things like real estate. The vast majority DO NOT think it’s in the national interest for gasoline prices to go up.
The city data forums are infested with realtors. The first post on page 17 of this thread by “Calix” is excellent:
http://www.city-data.com/forum/denver/1348006-positive-real-estate-news-17.html
Interesting that Calix used the ‘greater fool’ phrase there in the CD post. At some point, people may start wondering if houses will have enough generational krill for greater fools to allow higher prices and higher prices.
I liked the greater Denver area stats posted on the page. It shows that while select nabes like Broomfield and Highlands Ranch are in demand with rising prices, that most of metro Denver is not. Bubble 2.0 is VERY localized.
^
lolz
Only for some things like real estate. The vast majority DO NOT think it’s in the national interest for gasoline prices to go up.
Critical thinking quiz:
For which “some” things are price increases in the national interest, and for which “some other” things are price decreases (or stablized) in the national interest?
List your criteria are for distinguishing the two, and why.
Partial credit given.
If “being in the national interest” means that the government does specific things to support prices, I can give you a partial list:
housing (tax deductions for interest, backing loans etc.)
higher education (see above)
child care (tax deductions again)
medical care (tax deductions, restricting slots for medical residents, making it as hard as possible for foreign trained doctors to get liscenses in the US, not letting nurse practitioners take on as much primary care they probably could handle, etc.)
drugs (extremely long patent protection periods, agreeing that Medicare can’t even bargain with drug companies for lower prices, etc.)
food (farm subsidies/price supports, etc.)
Someone want to come up with a few others?
Great examples of federal reserve price fixing.
Thanks Polly. Actually I was thinking of things which are truly used up, like gasoline, as opposed to something which lasts long enough sell. Even if the house falls down, the land is worth something.
Polly’s is a list of “needs” products which were too expensive for the lower classes so the government stepped in to help. Of course, all that did was make the greedy private sector offer the needs at a higher price, basically raking in government money.
City Data moderators have to take an oath to cheerlead for real estate. That is my suspicion.
perhaps she doesn’t know what “appraisal” means either
Here’s a Federal Reserve recent, detailed and and scientific study on how REO’s affect home prices (whether the REOs are “counted” in the median home prices or not):
Estimates of the Size and Source of Price Declines Due to Nearby Foreclosures* Feb 7, 2013
http://www.federalreserve.gov/pubs/feds/2012/201284/
1 Introduction
Since 2007, house prices have fallen and foreclosures have surged in many parts of the United States. Two questions that have received much attention from policy makers are whether foreclosures are contributing to, or are merely a symptom of, the price decline, and if so, how? The answers to these questions are important because foreclosure externalities may justify government intervention into the housing and mortgage markets, and the appropriate type of intervention depends crucially on the source of the externality…………
………There are two main mechanisms through which foreclosures may reduce house prices. The first, which we call the “disamenity effect”, is that the owners of foreclosed properties may not maintain the homes, and the associated neglect and vandalism may create a negative externality on nearby homes. The second, which we call the “competitive effect”, is that foreclosures increase the supply of homes on the market, which should lower prices in a standard model of differentiated products price competition.
………We find strong evidence that the local market responds to the REO rather than the reverse or to some correlated unobservable when we compare local list prices immediately before and after a new REO listing. List prices, which are recorded every week that a home is on the market and for all homes, regardless of whether they eventually sell, provide enough observations within short time periods and narrow geographic areas to get precise estimates. We find that sellers are 12 percent more likely to adjust their list price downwards in the exact week that a single REO enters the market nearby……
8 Conclusion
In this paper, we use a new dataset from the MLS to show that foreclosures do indeed have a causal effect on nearby house prices, and that the competitive effect rather than the disamenity effect is the important source of price declines. A new foreclosure listing lowers nearby house prices by 1 percent, which is a significant effect given that 1) 27.5 percent of sales in our sample are of homes nearby an active foreclosure listing and 2) houses in our sample typically sell for over a half million dollars. We find that on average, new REO listings have a comparable effect on local prices as new non-REO listings. We find that the high degree of differentiation between REO properties and nearby homes softens the extra competitive pressure from banks that price aggressively.
CS methodology excludes REO and short sales.
Run coward run!
Here’s a scholarly study saying that, for an “investment”, REOs may not be all that great compared to buying a non-REO. (At least at the time and place of the 2004-07 UNLV study)
It’s a pdf.
Estimating the House Foreclosure Discount
Corrected for Spatial Price Interdependence
and Endogeneity of Marketing Time
http://faculty.unlv.edu/nasser/ECO%20772,%20Econometrics%20II/Reading%20List%20Articles/Clauretie%20and%20Daneshvary%20-%20Estimating%20the%20House%20Foreclosure%20Discount%20Corrected%20for%20Spatial%20Price%20Interdependence%20and%20Endogen.pdf
…….We find that as much as one-third of the negative
effect of foreclosure status can be attributed to associated characteristics that also negatively affect price. A less-than-excellent property condition, nonowner occupancy and a cash transaction all have a negative impact on price. Yet, these
characteristics are often associated with foreclosed properties.
……The findings of this article suggest several implications. First, given the estimated size of the property condition coefficients, it is worthwhile for the lenders to make short-sell arrangements with the owners of a to-be-foreclosed property in order to avoid deterioration of the property condition. Second, our findings suggest that the housing market is more efficient than suggested by earlier foreclosure research. This suggests that speculators purchasing properties in a down market will likely not earn significant excess returns by focusing on foreclosed properties versus a strategy based on purchasing in the general
market.
A cautionary note concerning our findings is in order. Our study uses a data set composed of homes that were sold between November 2004 and November 2007 in Las Vegas, Nevada.
CS methodology excludes REO and short sales.
Yes. Because REOs don’t affect median home prices, because REOs only add to the supply of homes on Mars.
And since REOs only add to the supply of homes on Mars, they have no affect on home prices on Earth. That goes doubly for USA home prices because Mars is a totally different country with a lot of REOs that we ship to them on containers.
“Here’s a Federal Reserve recent, detailed and and scientific study…”
You lost me at ‘Federal Reserve’. Is this the same Federal Reserve that said there was no housing bubble, then denied that they could have possibly known, despite the fact that Ben and a couple of other bloggers had been documenting it for a couple of years? Please- next time you are this desperate to win an argument, quote someone more credible than the FED, like Bill Clinton or Bernie Madoff.
When a bank takes a house on its books due to foreclosure, it doesn’t get counted in the Case Shiller index. When a bank sells a REO, it is counted.
Please- next time you are this desperate to win an argument, quote someone more credible than the FED,
You’ve countered with less than nothing. Please do the math in the study and get back to me with math.
What you have just offered is a genetic fallacy, which is, in fact a lazy argument and really no argument at all.
The genetic fallacy, also known as fallacy of origins, fallacy of virtue,[1] is a fallacy of irrelevance where a conclusion is suggested based solely on something or someone’s origin rather than its current meaning or context. This overlooks any difference to be found in the present situation, typically transferring the positive or negative esteem from the earlier context.
The fallacy therefore fails to assess the claim on its merit. The first criterion of a good argument is that the premises must have bearing on the truth or falsity of the claim in question wiki
Rio:
I don’t know why you guys are arguing about whether or not to use data that don’t include REOs. You seem to be saying that REOs already affect the rest of the market, so it’s OK to exclude them, since they are indirectly “included” in their effect on the other houses that are directly included.
So what if it were the other way around? What if non-REOs were not included? What if I were to say that I was only going to track the value of REOs, under the premise that REO values are indirectly influenced by the rest of the market, which means that I am actually indirectly including the rest of the market? That wouldn’t make any sense, would it?
The NAR just doesn’t like to use any stats that include REOs because they know that REOs would reflect the actual median, rather than an upwardly skewed median.
“Comment by RioAmericanInBrasil
2013-08-16 12:14:02
Please- next time you are this desperate to win an argument, quote someone more credible than the FED,
You’ve countered with…
[insert wasted bandwidth and pseudo-intellectual soliloquy here]
… in question wiki”
CS methodology excludes REO and short sales. Always did and always will.
“The most typical types of non-arms-length transactions are property transfers between family members and repossessions of properties by mortgage lenders at the beginning of foreclosure proceedings. Subsequent sales by mortgage lenders of foreclosed properties are included in repeat sale pairs, because they are arms-length transactions.”
http://us.spindices.com/documents/methodologies/methodology-sp-cs-home-price-indices.pdf
They do exclude short sales.
And REO.
I have never seen so many rentals on Craigslist in my life. It has exploded.
My rent went up 8.2% when I renewed my lease.
I started counting rentals in DC posted on Craig’s list…… It got boring after I got up to 3200..
And there are 32,000+ tenants competing for those 3,200 rentals.
Because “it’s different here”.
I have some friends moving to DC from Colorado. Going to be renting out their house there and renting in my building here. They are going to be paying 11% more for their place than I pay for mine. Same floor plan, but they have a patio (nice) because they are on the 2nd floor (not so nice because there is less natural light and more street noise). They will be paying 11% more than my current lease. I’m a little worried about what my renewal notice is going to look like in October.
Same tidal wave of rentals is washing through Tucson. There isn’t much to buy, but boy, you sure can rent a place.
I feel sorry for the landlords. A lot of them are mom and pops who were hoping to rent out the places for some extra money. That hope ain’t happenin’.
Good info on Tucson AZ…..
with tens of millions of excess empty inventory and growing, this should bè no surprise.
As I reported from my cruise, we are trying very hard to catch up, converting every post industrial empty relic into “luxury apartments”.
“There isn’t much to buy …”
That may be true, but RE inventory is up 11% y-o-y in Tucson. There is actually more to choose from now than there was last year, even though prices are up.
Hey bink:
I thought you moved to HI. Don’t tell me they made you come back to the continental US. Ugh.
Rebubble Trouble. It’s all the rage, haven’t you heard? Luckily, inventory is already skyrocketing just about everywhere, so the rebubble shouldn’t last very long.
I did move to Hawaii. We’re moving back to the mainland soon. No particular reason other than we’ve been here now for several years and I like variety. We’ve also got a kid who wants to see her cousins and grandparents.
I don’t see much for sale signs in Mission Viejo or my Ahwatukee, Az area, so I think it is a bubble now. When the RE bubble part one burst a few years ago, most nabes had for sale signs all over.
“With 25 million excess empty houses, 4 million of which are in the state of California alone, what do you think is going to happen to housing prices?”
Crater.
interest rates are going up. and when interest rates go up, home prices go up.
if you want to buy a home, you should buy soon to take advantage of the low prices and low interest rates before the prices and interest rates go up.
And you should pay more than asking price- like 5x or 6x their asking price- to insure that the value continues to go up, vastly increasing your net worth. Yes. And don’t buy just one house, buy 15 or 20.
This is a couple days old, but still a goodie.
A hit piece against Richmond, CA’s eminent domain plan. The column is full of double-speak and self-contradictions, but that’s to be expected from a flaming wingnut trying to please his paymasters.* But for all his BS bluster, it appears that the author cannot deny that Richmond has a case based on Kelo.
—————
Richmond, Calif., runs amok with eminent domain
Ilya Somin, August 12, 2013
“Story Highlights:
Various banks and investors have filed lawsuits arguing that the Richmond policy is unconstitutional.
The money to purchase the mortgages will come from taxpayers, including the poor.
Richmond’s plan to condemn mortgages is unlikely to benefit the local economy in the long run…
“…We should also remember that eminent domain that transfers property to private parties is often used to benefit the politically powerful at the expense of the poor and the weak. In Kelo v. City New London(2005), a closely divided Supreme Court ruled that government could take private property and transfer it to influential business interests in order to promote “economic development.”
…So long as Kelo remains in force, the Richmond takings probably won’t be invalidated because they transfer property to private interests,
…Richmond’s plan to condemn mortgages is unjust, unconstitutional, and unlikely to benefit the local economy in the long run.”
—————-
http://www.usatoday.com/story/opinion/2013/08/12/richmond-california-mortgages-column/2641293/
I think the funniest outcome would be for Richmond to win its case based on Kelo, and then if FHFA or banks refuse to lend again to such a rogue city, Richmond could then sue for redline discrimination under the Community Re-Investment act. Wouldn’t that stir the pot.
—————-
*This guy teaches at George Mason U, which — as HBB posted before — receives more Koch money than any other organization (sourcewatch). He authored a book titled: “Why Smaller Government is Smarter.” And I’m supposed to believe he’s a champion of the poor?
not willing to lend money to someone because they want pay it back is racism…only in america.
REVIEW & OUTLOOK
August 8, 2013, 7:19 p.m. ET
Seizing Mortgages for Fun and Profit
Perhaps the biggest eminent domain case since Kelo.
The small city of Richmond, California has some big ideas about seizing private property, and now it also has a big lawsuit on its hands. This is what happens when politicians use government power to help themselves and their private financial partners at the expense of others.
Last week the Bay Area city became the first in America to say it intends to use eminent domain to seize private mortgages whose value is higher than the current value of the homes they helped to buy. The city wants to force mortgage companies to sell loans on 624 properties, and if they refuse the city is threatening to seize the loans by brute government force.
Richmond wants to refinance the loans through the taxpayer-backed (and broke) Federal Housing Administration, pool them into a new security, and sell them to other private investors. Homeowners will get a free principal reduction, and the politicians will claim they eased the financial burden on borrowers.
…
More to the story:
http://www.nakedcapitalism.com/2013/08/beware-of-private-equity-guys-bearing-gifts-eminent-domain-mortgage-scam-hit-with-well-deserved-lawsuit.html
“But the MRP scheme relied on condemning those mortgages at a large discount to their value by the bait and switch of claiming the mortgage value was based strictly on the value of the home, which is inaccurate, and then arguing for a discount from that. Look at how much the investors get ripped off, per this summary from Nick Iimiraos of the Wall Street Journal last year: “
This would be a Reverse Kelo, taking a dump and trying to turn it into something valuable.
“…taking a dump and trying to turn it into something valuable.”
As in, ‘polishing a turd’ or ???
The Richmond case does not even remotely need Kelo. Closer precedents existed before Kelo:
• As Justice O’Connor said in her dissent, as long as the transfer from private party to private party DIRECTLY mitigates the immediate social harm, there are two pre-Kelo private-to-private precedents for that - Berman and Midkiff.
• The politicians and FIRE sector have howled about neighborhood stabilization for a long time, and used it as a guise to shovel yet more money at the FIRE sector, in order to receive laundered contributions back.
• This Richmond case, with the taking and transfer, will directly and immediately improve neighborhood stabilization, and mitigate poverty from paying hopelessly underwater mortgages.
• Side note: The insanity of Kelo was that Suzette Kelo’s house posed no immediate social harm, and that the transfer was for future vague promises of increased tax receipts and employment. Today, the razed neighborhood is a dumping ground for storm debris.
The Supreme Court opinion with dissents: http://www.supremecourt.gov/opinions/04pdf/04-108.pdf
I realize these are irresponsible and stupid buyers but if they actually want to do a private-to-private eminent domain which immediately improves the quality of life of the neighborhood, this is probably that case. Precedents existed before Kelo. The insanity and injustice of Kelo is not needed for this taking.
He authored a book titled: “Why Smaller Government is Smarter.” And I’m supposed to believe he’s a champion of the poor?
So you actually believe that Big Government is good for the poor?
That must be why the poor are so much better off today than they were 30yrs ago.
Oh, wait…
Sometimes doing the counterintuitive thing results in the desired result:
1) In an aircraft stall, you point the aircraft at the ground and firewall the throttles. Instinctively, one wants to pull back on the stick to climb. That leads to an inevitable crash.
2) Instinctively, one will want to simply firehose money to the poor to make them better off. Policies geared towards increasing the wealth of society - and it is the private sector that creates wealth in its various machination, counterintuitively is the best thing for the poor. Harnessing that machine with a light touch is historically the best way to lift the poor out of their plight.
3) This country is stuck on trickle-down economics instead of trying to grow the middle class. This is a direct result of a totally corrupted political funding system.
Caveats:
1) The private sector should be engaged in productive activities, not like a Mafia that is a net concentrator and destroyer of wealth.
2) Kleptocratic resource-rich third world countries also have high wealth concentrations and impoverished populations. Trickle down theory has not worked well there.
3) The currency - slips of paper - is not the wealth, it is merely a representation of the wealth. The wealth is in the standard of living. If the slips of paper were the actual wealth, Zimbabwe would be the wealthiest country on the planet.
Headline: Oxide supports forced confiscation of personal propery.
Not really news. We know she is a proponent of thugernment.
Good point. Oxide post so much about fairness and the rich. You know those people who have more than they need. Wonder why Oxide does not let some of the poor live in her unused bedrooms? Oh yes liberals are all for helping the poor. Of course as someone else’s expense. Reminds me of Obama and Warren Buffet and Bill Clinton who moan that the rich should pay more taxes. But what is stopping these guys from leading by example?
*recently rebranded “progressive”
Let’s get the thugernment to eminent doman Oxide out of her home!
“Why would someone pay more than new construction cost ($60 per square foot) for a depreciating 20+ year old resale house?”
Because they have no idea how to establish the value of a depreciating asset…. in this case, a house.
American Exceptionalism:
“At least 30 percent of adults were obese in 13 states: Alabama, Arkansas, Indiana, Iowa, Kentucky, Louisiana, Michigan, Mississippi, Ohio, Oklahoma, South Carolina, Tennessee and West Virginia.
Louisiana and Mississippi led the list. In both, nearly 35 percent of adults were obese. Colorado was lowest, with less than 21 percent obese.”
http://www.denverpost.com/nationworld/ci_23870619/obesity-very-high-13-states-many-south
Between rampant obesity and dumbing-down, in 20 years we’ll be reading stats like “110% of Americans in 58 states are now obese.”
considering there are currently 57 states, you are predicting puerto rico will become the next new state?
New Mexico will become our next state.
‘Colorado was lowest, with less than 21 percent obese.” ‘
That’s because CO has the Colorado Trail. How can a state have obese people with a trail like that?
it’s because the pretty young things won’t stop moving here.
300+ days of sunshine a year = getting off your ass and doing sh1t outside. ohio/michigan = sitting on the couch watching teevee and eating cheeze doodles because it’s too cold to go outside 5 months a year.
But Cheetos are the best.
Wrong.
Try them. You’ll like them.
“But Cheetos are the best.”
…but not when your watching porn.
Joke about a guy who goes to his doctor when his peni$ turns orange. Punchline something about ever since he got laid off he sits on the computer all day watching porn and eating cheetos.
your = you’re I misspell that alot
In Arizona most people are skinny because the summer heat melts off their flab.
Living in Manhattan its very hard for obese people to get around, sure there is a handicapped car service, but i think 75% or more of the subway stops have no handicap or elevator access and sometimes you have to walk up or down 5 flights of stairs…to the platform or street.
of course their food choices are lousy and fish is still usually double what hamburger and sausages cost. …..but then at $4 lb isn’t Cheetos and oreo cookies about the same price per pond?
I was just looking at Hannah and friends out having fun. They all look rather portly for being under twenty, IMHO.
Not sure who Hannah is…but I think the Camera adds 10 pounds.
“Not sure who Hannah is…”
The recently kidnapped young lady from San Diego.
rms
Victim or Accomplice? The verdict is out.
Hannah isn’t a sweet young thing.
The whole story stinks to high heaven. We don’t know the half of it yet, imho. http://newsball.com/reward-for-capture-of-james-dimaggio-and-more-about-hannah-anderson/
“We don’t know the half of it yet, imho.”
+1 I agree, but she’s also a teenager in S. California too. I’m confident the law enforcement peeps looked at all the possibilities before she was allowed to return home with dad.
rms
I don’t think manicures, smiling selfies and social network Q&A’s (under 48 hrs of being rescued and learning of your murdered mom & brother) are grieving mechanisms. imho, something wicked this way comes. But you’re right, Law Enforcement will sort it out. Would not be the first time the “victim” isn’t innocent.
“I don’t think manicures, smiling selfies and social network Q&A’s (under 48 hrs of being rescued and learning of your murdered mom & brother) are grieving mechanisms. imho, something wicked this way comes.”
The dysfunction in this family is every parent’s fear, which is why parents stretch for the better neighborhoods. It’s a modern sad scene right up there with Nadya Suleman’s litter.
Colorado was lowest, with less than 21 percent obese.
Not too long ago, 21% was considered high. So, in 20-30 years, will the Centennial State be bragging that “only” 50% of its adult population is obese?
The majority of the Fats are along the I-25 corridor.
And according to Obama, Pelosi, et al these land whales deserve taxpayer funded healthcare. It’s their right!
“A middle-income family will spend $241,080 on average to raise a child born last year to the age of 18, a 2.6 percent increase from a year ago that outpaces the broader inflation rate, according to a government report.
Housing was the largest expense at 30 percent of spending … Child care was the second-biggest expense in more affluent homes, ahead of food, while health costs pinched all household budgets.
“The cost of raising a child increases as family income goes up because families have more resources (Um, no. Because they don’t read the Mr. Money Mustache blog),” Kevin Concannon, the USDA’s undersecretary for food, nutrition and consumer services, said on a conference call with reporters.
http://neighbors.denverpost.com/viewtopic.php?p=3122768
The cost of raising a child increases as family income goes up because families have more resources
Half-day British soccer camp for two children for a week: $250
Seeing them score their first goal in a game: Priceless
Seeing them score their first goal in a game: Priceless
When the kids abandon soccer after high school - WTF! all that time, energy and money spent
Bwa-ha-ha-ha-haH! It sure doesn’t cost an illegal immigrant anywhere NEAR that much to raise a child, especially when they’re raisin’ ‘em on the taxpayer dime. “Everything free in America”.
As to soccer, they have their own soccer camps. It’s called national and state parks. I just read two stories, one about a park along the Delaware River, another along the Housatonic River in Connecticut. These parks are now more or less unavailable to regular US citizens, they’ve been trashed and taken over by immigrant families from south of the border, with their booming music, soccer games and litter all over the place, and surly, threatening attitudes towards citizens who may like to enjoy a nice peaceful day with the family. C*cksuckers.
Racis.
More like county parks. You have to pay to get into National Parks and most state parks. County parks are the ones with the athletic fields.
Half-day British soccer camp for two children for a week: $250
Seeing them score their first goal in a game:
Priceless$450 (you have to add in the gas and those cool futebol uniforms)You aren’t kidding on uniforms. No more team t-shirts… now it’s home and travel jersey with their name and number, shorts, warm ups, gear bag, etc.
FWIW, my daughter will be attending a Brazil Soccer camp next week with her travel team. Then the fall soccer season officially kicks off.
real estate is undervalued like aapl is undervalued.
ZNGA is a steal at 65 P/E ratio. Mobile gaming will be 25% of GDP within a decade.
The next AAPL is in biotechnology. Boomers want to reverse the body clock and be young again.
I have a mean look with furrows on my forehead. Been thinking for years of Botox. But internet nags are opposed. If women can get fake boobs and not be dissed about it wh can’t boomers get Botox? Betcha Tom Cruise has Botox.
‘more than half of all homes sold last year and so far in 2013 have been financed without a mortgage, according to an analysis by economists at goldman sachs group.’
http://blogs.wsj.com/developments/2013/08/15/report-half-of-all-homes-are-being-purchased-with-cash/
“financed without a mortgage”
So there was still financing involved, but it just wasn’t mortgage financing?
“With housing demand at 17 year lows and falling, just who are the few individuals that are buying?”
Answer: Dumb. Borrowed. Money.
’sluggish sales at major retailers paint a grim picture of an uneven economic recovery that has low- and moderate-income households reluctant to buy anything beyond the bare necessities.
three years out from the worst recession in generations, many americans are still contending with unemployment or stagnant wages that limit their disposable income. this group has also been disproportionately squeezed by the restoration of the payroll tax and rising gas prices, economists say.’
http://www.washingtonpost.com/business/economy/spring-retail-sales-tell-a-tale-of-two-shoppers/2013/08/15/630491d6-05be-11e3-a07f-49ddc7417125_story.html
And the great divide continues to grow.
The distribution of wealth is reverting to the norm. Post WWII middle class life style was a historic and economic anomaly.
P.S. Most people include poor still have it better than ever - mobile phone, air condition, food has never been more plentiful or cheap - see someone’s earlier post about obesity, better medical advances, etc…
‘thefts of smartphones and other electronic devices in the metro system spiked in late july and early august, prompting officials to urge riders to pay attention to their surroundings.
‘get your head out of your iphone,’ metro transit police chief ron pavlik said thursday during a news conference to talk about the increase in grab-and-run crime.
‘you wouldn’t go around flaunting $400 in cash in your hand, and that’s what you’re doing with your phone,’ the chief said.
http://www.washingtonpost.com/local/trafficandcommuting/theft-of-mobile-devices-spikes-on-metro/2013/08/15/0a69d07a-05e3-11e3-a07f-49ddc7417125_story.html
The only phone you should have out in public is your ohbahhmaphone….
Its amazing how careless some people are even on NYC subways
I tell people it can be far cheaper to use the pay phone then free wifi for your smartphone……If you are using a pay phone thieves will figure you have nothing to steal in your bag.
Are the payphones still around? I will be in look out for those.
If you are using a pay phone thieves will figure you have nothing to steal in your bag
Back in the 90’s kidnapping was an even bigger problem in Mexico City than it is today (hard to believe). Anyway, I heard that it was not uncommon for executives to dress like bums and drive a beater (say a 30 year old VW bug) to the office, where they would change into their $1000 suits for the day. Then at the end of the day, they would say “Shazam” again and be magically transformed back into a poor guy before going home.
Of course the really rich guys would had bodyguards.
Reminds me of when I spent some time working in Kingston, Jamaica. We were instructed to place our laptops in garbage bags and carry them into work. I still question the wisdom but it did appear to work.
You only mainly see Hollywood celebs and politicians with bodyguards. The very rich.
What do the US demographics look like for the next 30 years? At some point, there will be a greater amount of retirees than ever, percentage-wise. How will housing prices do then?
We’ll just keep importing people until no one wants to come here anymore.
Yeah there is a variant of Idiocracy going on. Not enough base of income whales to support ever-increasing house prices. Interest rates? They have to go higher or else we are all bogus.There is a non-paradox about to happen down the road. You can not have people making ever-increasing monthly payments if their pay is reaching asymptotic parity with global wages…………..
Maybe they can have like 3 immigrant families pool together to buy a “casa”
That demographic trend is already in play. Whats is ahead of us right now is 80 million boomers just beginning to die off.
This leaves an addition 35 million to excess empty houses.
And remember, immigration is flat to negative and the birth rate is all time record lows.
When the Shamnesty passes, there will not only be the 12 million Nuevos Americanos currently residing in USA made legal, but an additional 50 million moving here in the next decade thanks to family reunification “chain migration” laws.
“80 million boomers just beginning to die off”
Grandkids on the sidelines will get many of the homes. I see it in our tract already. Free house or close to it, so money is readily available to fix it up. Great deal. It was worth being nice to granny, the widow.
Real Estate is such a racket, but having a home is wonderful. There was a time when real estate was just a home. Bought at 17.5% ARM in 1984. Volcker is the man, who last fixed an economic mess. I lived it. Sold at 8% APR in 1998, when interest rates were real.
You’re a racket.
What’s it like to have to fetch coffee for the boss at 65 years old?
You know, while my investments return an amount twice my current income in today’s dollars, I would shine the shoes of my boss.
If the grandkids are going to all get free houses from their grandparents, then I guess those kids won’t be in the market to buy a house.
PS
The Baby Boomers are mostly not leaving anything to anyone. They almost all plan on spending every last penny before they die. Their kids and grandkids will have to fend for themselves in a worsening economy. Inheritances will be going down, not up.
I will try to spend every last penny. In five years I will be eligible to start distributions on my 401k and traditional IRA, whatever is in it. I am saving my Roth for much later and will have medical research charities as my main beneficiaries.
Also having a Roth does not stop you from inheritance taxes, which will affect those with over $1,000,000 in assets. As a good anarcho capitalist I want to leave as little as possible to the thugs.
I will try to spend every last penny.
You really need to buy the car now.
No place to put the car. I’m allowed only one space at the place I rent in OC. Otherwise it’s going to have to be in front of a colleague’s house. Not sure if the “People’s Republic of Orange County allows parking on residential streets in the M.V. / Laguna Hills areas.
The rich retirees will buy multiple homes so they can travel throughout the year. House prices will SOAR.
SORE!
The question to ask is if the world is becoming an idiocracy. I think a lot, if not most of the third world nations are increasing their level of intelligence, particularly those without nanny statism. Idiocracy occurs only through taxpayer subsidy, no other way.
Mobocacies are the deal in the developed nations. I think there are some Asian nations that aren’t necessarily xenophobic, that will allow escapees out of this abyss of America, provided they have enough assets to be ever self sufficient and pledge never to live off of their people.
Bay Area Housing Demand Collapses A Whopping 32% YoY
http://picpaste.com/pics/e8cea4626f00e76bf4b20ef426f0adae.1376499796.png
LA County, California Housing Demand Crumbles To 5 Year Lows
http://picpaste.com/pics/c2625adee89fe28f63e694131a66c420.1376500169.png
rent now or be priced out forever:
‘new-home construction in the u.s. climbed in july, reflecting a rebound in multifamily projects that overshadowed a slowdown in single-family properties.
multifamily construction surged 26 percent, while work began on 2.2 percent fewer single-family homes.
builders may be limiting supply amid a shortage of lots and materials as they try to boost prices and revenue in an industry that has supported growth.’
http://www.bloomberg.com/news/2013-08-16/housing-starts-in-u-s-rise-on-rebound-in-multifamily-properties.html
a futile attempt to thwart the inevitable permanent democrat supermajority:
‘the gop is launching a ‘rising stars’ program, a slate of new spokespeople who have young or non-white or female faces that look nothing like those who make up the party’s current base.’
http://www.businessweek.com/articles/2013-08-15/the-gop-goes-in-search-of-non-white-faces
We already have a flimflam party…why do we need 2?
Can’t they just go back to being evil party?
The Democrat Party in the year 2025 will be like the Khmer Rouge with COEXIST stickers and SNAP cards.
The Republican Party in the year 2025 will be like today’s Democrat Party.
Who will be our Pol Pot? Please make it a hot young woman….I beg of you.
I am neither Republican nor Democrat. I vote, not because I think it matters and not because I think there is anyone to vote for. But I certainly do not vote democrat and I avoid voting for republicans.
The GOP is the stupid party … the Dems are the Evil party.
This would be hilarious if it weren’t so pathetic. The GOP is a black eye for white people.
“Housing as a rental investment is a huge gamble considering it’s negative cash flow at current inflated asking prices of resale housing.
Beware.”
You can
“Resale housing is currently prices 40% higher than new construction costs (materials, labor and profit).
And considering new construction prices are massively inflated, resale housing is overpriced by 250%.
Phoenix Housing Sales Collapsing; Down 11% in a single month
http://picpaste.com/pics/65ac7b4b4553358e34de5cca885f63ee.1376662047.png
So you go out and pay a massively inflated retail price for a depreciating asset and then turn around and expect to sell it for more???
“A ‘housing recovery’ is falling housing prices to dramatically lower and more affordable prices, by definition.”
Liar!
Too much exhortation…… It should be a casual, cavalier, “you’re a liar”.
I’ll be in Aspen this weekend, gonna pick up a few more $5,000 lots in addition to the ones I bought when I was there in June. How soon can you have my ski chalet built at $60/SF? I want it ready by Thanksgiving.
Why would anyone want to build a $60/SF house in Aspen Colorado on a $5000 lot when houses always depreciate??
Send your drawings. Did you buy your lot yet?
No shortage of $5,000 lots in Aspen. I couldn’t make up my mind so I bought ten of them. When can you start building?
http://www.landwatch.com/Colorado_land_for_sale/Aspen
Send me the drawings.
http://www.marketwatch.com/story/mobius-on-fed-chief-summers-the-real-surprise-2013-08-16?dist=lcountdown
Looks like the MSM has been made aware of Obama’s decision, and it’s time to warm the American public to it.
“Mobius on ‘Fed chief’ Summers: The real surprise”
Monterey County CA Housing Demand Craters 15%
http://picpaste.com/pics/1f90bf0c7ea1980e9427fd94649033c0.1376662995.png
The government pays a tremendous amount of money to the FIRE sector through its bond buying and various subsidies. A chunk of that money is directed back to pliant politicians. It’s a lot like money laundering for politicians.
corrupt politicians.
Why direct it back when the politicians can openly own and trade on insider information?
Are there any man made/manufactured items that don’t depreciate? Anything?
Musical instruments that are well cared for are the only possible thing that comes to mind for me. Unless you count things like gold coins in which case the involvement of man doesn’t have that much to do with it. Oh yeah…guns as long as you keep them functional. Might apply to things like stainless knives and tools of all sorts as well. Those would be my best guesses. But uncared for I can’t think of anything.
What percentage of those stringed instruments are gems out of the total manufactured? And guns? And the knives…..
Are there any man made/manufactured items that don’t depreciate? Anything?
Your question leads to nowhere in the housing argument.
Many man-made things don’t depreciate relative to the period of time we own them and our limited lifespans.
I’ve sold many items for more than I paid for them. Many, including land.
In the long-run we’re all dead. When we are dead, are our past possessions depreciating? For whom?
If we live in a paid-off house for 20 years, can it depreciate faster than the return of shelter it is providing? If it does, does it matter much if we love to live there?
Houses depreciate. Rapidly
What are your losses to that depreciation?
HousesOur bodies depreciate. RapidlyHouses depreciate. Rapidly.
What are your losses to that depreciation?
Stuffed animals.
Fine art. Fine cabinetry. Rare books. Flawless cut gemstones. Bespoke clothing with celebrity provenance. Historical artifacts. Custom Italian rolling stock.
How many centuries out are you asking?
Fine art? out of how many pieces painted? Books? Out of how many books written? There are no “flawless” gems other than the diamond GE made.
Way to weasel!
Well? How many? Answer it.
Way to weasel some more!
Stop running from it and answer.
Back in your hole, weasel. I’ve got a shotgun.
A manmade Belgian shotgun that’s appreciated significantly over the last 100 years, btw.
Answer the question Prom Queen.
How many guns have been manufactured over the last 300 years?
Quoting here: “ALWAYS”
Glad to see you’re finally refining your argument, though. It becomes you.
Pax
You asked for any. One suffices.
Good quality wine. The older it is the better, up to maybe 30 years. Buy a good quality bottle at $100 today and it could be $2,000 in twent years.
Yep. (hic) The trick is refraining from cracking the bottles for forty years….
Stock prices are way too high. Why aren’t they falling faster?
Stocks are falling and I think this is just the begining.
I dumped my meager holdings a couple of weeks back; now sitting on the sidelines watching for a rational entry point. Don’t know if I will have the patience to wait for QE4 at the end of the next crash.
I heard people say this same thing two years ago. And they missed out on big gains. Yes I sold off some last year and this year. My latest purchases in GDXJ, up more than 31% since I bought in July.