The Housing Bubble

I agree with your point — i.e. the scales were basically rigged to fill the space of the chart with a big X to make the point that GDP growth and stock prices are moving in the opposite direction suggested by fundamental considerations.

However, I also maintain that a 1% drop in GDP growth rate should have a larger-than-1% effect on stock prices, due to comparing the growth rate of a flow variable to the level of a present value concept — except the effect should move in the same direction, not opposite as in the figure.

I can’t stand to pay attention to either of them for any longer than the time it takes to change the channel.
The “off” switch is the best way to change the channel.

‘The “off” switch is the best way to change the channel.’

Still better: If you never sit your arse down in front of the teevee, you never have to risk accidentally changing the channel to a show featuring either Cramer or Trump.

A bean counter’s solution to the problem would be to increase the tax per gallon, but if they did this then the incentive for cut backs on consumption would increase and this would lead to further cut backs on consumption.

‘So as the price per gallon goes up the incentive to cut back on consumption also goes up and this cut back on consumption cuts the tax revenue because consumption is what the tax revenue is based on.’

I am inclined to wanna get a moped some time in the future. Problem is where do I park it in the winter months unless I have a buddy with a garage. For spring and summer into fall, a moped that is good on gasoline would take care of 90% of my routine driving tasks.

I am surprised we have not seen more mopeds on the road. Guess it is personal preference and maybe safety.

If the California’s goal is to reduce consumption and at same time maintain revenues (or not lose too much due to variation in price) then the best solution will be to have a minimum of the current $0.487/ gal tax or 12% whichever is higher.

If the California’s goal is to reduce consumption and at same time maintain revenues (or not lose too much due to variation in price) then the best solution
would be a $10 or $20 per gallon tax.
However, that might cause rioting even among the laid-back Californios, but that wasn’t one of the goals you mentioned.

“However, anyone who ever drives through LA has to suspect that it is different there, where one inevitably encounters millions and millions of motorists puttering along at 5 mph any time of day or night.”

Last time I was there it was all 5-lanes going 80-mph!

“Last time I was there it was all 5-lanes going 80-mph!”

It does tend to be either feast or famine. Once the motorists break free of the 5 mph parking lot procession, they naturally vent their frustration by pushing the pedal to the metal.

I get a week of commuting per tank, which makes it easy to compute my financial outlays for filling my tank. With 50 weeks of work a year (within rounding), $60 a week translates into $3000 in commuting costs for fuel alone. Add in vehicle depreciation, license fee, insurance and maintenance and you have a costly though convenient form of transportation.

At least the depreciation and maintenance costs on $25K car are a small fraction of the losses on maintaining a $500K home.

How does the 3k compare to eating out costs for the year? I am sure it is less than 3% of gross income. As I said for those that live paycheck to paycheck it is really hard - imagine if the paycheck to paycheck family has to make a payment on the depreciating house also.

High gas prices make the price of everything else higher too.

“How does the 3k compare to eating out costs for the year? I am sure it is less than 3% of gross income.”

True…I guess I need to count my blessings here.

I guess I need to count my blessings here.
Now & then I use my checking account software to summarize all my expenditures over large amounts of time: food consumed at home, food consumed in restaurants, gasoline, home heating fuel, etc.
I am blessed that I can pay for it all.

Before or after we are all dead?

Whac:

There are some moments when I’m sure that the housing market is teetering on the brink, and prices will decline over the next 12 months. In other moments, I think the housing market will just go up forever. If prices don’t drop again (and fully) before I die, then I will die from the stress of it all.

“There are some moments when I’m sure that the housing market is teetering on the brink, and prices will decline over the next 12 months.”

I have to say that talking with my teenagehood friend who is now a successful Realtor® in my old territory was a real eye opener. It amazes me that Zillow gets away with publishing estimated home values that exceed the highest recent comp in the area by more than 20%. There ought to be a law against this!

The real shocker was to look at the recent sale prices per square foot in my parent’s area. We are talking a median below $50/sq ft — well below HA’s estimated replacement value!

when I’m sure that the housing market is teetering on the brink, and prices will decline over the next 12 months. In other moments, I think the housing market will just go up forever.
Then there are all the other possibilities you did not mention or enumerate. We are all on the brink of something, every moment. I’m on the brink of making breakfast.

Having $1 million in loose cash hanging around is a tragedy. It’s like imprisonment.

Even we with a $100 bill tucked away are living the nightmare.

The ConservaLIEeral statist globalistas want that too. No amount is too small too steal.

Ain’t that the truth…

Well, SOMEBODY has to pay for freebies in Washington, DC.

Might as well be you.

Maybe you somehow would know when the original discussion took place.

YOU know when the original discussion took place. can’t you read your own quote? a ‘few weeks ago’. in other words, a few weeks before ten days ago.

Why would I lie about this?

to make it look like i ran away from you?

There was a back and forth between us that went probably for a few hours.

of course.

At some point I had other things to do and I couldn’t check the blog anymore.

sure you did. if other things took you away from the blog, how could you know i ‘dropped the issue’?

One thing that I recall is that you did praise me for not just taking something out of a dictionary.

yes, and that was the reason that i didn’t point out the flaws in your definition. but i’ll be happy to point them out now.

If you criticized my definition, it must have been after that.

i never claimed that i criticized your definition. it should have been evident enough with the differences between the two.

OK, I suppose that I must have misinterpreted your remarks today. You say that my definition was inaccurate, but you didn’t criticize it at the time. That’s just atypical for you, given your tenacious, argumentative nature.

but you didn’t criticize it at the time.

i told you.. i liked the fact that you didn’t run to a dictionary like most people do.

That’s just atypical for you

yes, very much so.

Round and round the argument tree we go whenever tj shows up to post.

yeah, thank gawd we got you here to never start anything.. big mouth.

“…big mouth.”

Little touchy, are we?

‘deciding who got what land’

Let the people in each state decide. Isn’t that how it works in the east?

‘would you still want to live there if instead of being surrounded by forest, you were surrounded by houses’

Yes, I picked this house because it was the best deal I could get at the time. There are houses nearby, just spread out a little more than in town. In Flagstaff, we’re all surrounded by forest.

I forgot to mention, that just past the houses the forest is fenced, and there is a natural gas pipeline and cows are grazed. Presumably a under a lease.

¨Let the people in each state decide. Isn’t that how it works in the east? ¨

I guess so, if it’s state land. But you never see them giving it away. If they do decide to offload it, it seems like it’s usually to a well connected developer. So you end up paying full price for the house by the time it reaches you.

¨In Flagstaff, we’re all surrounded by forest.¨

But isn’t that because it’s government owned land? It would get developed in some way if they gave it away or sold it.

That’s why I’m of two minds about all the land the government owns. As someone who prefers limited government, I don’t like it, but I don’t see a reasonable alternative. I would hate to see it all sold for timber and turned into subdivisions.

“…government owned land…”

Case in point: One of the larger undeveloped tracts of land in San Diego County is on the marine corps base at Camp Pendleton.

‘I would hate to see it all sold for timber and turned into subdivisions’

Right now the forest service is in the process of burning 20,000 acres of forest outside of Flagstaff. We wouldn’t want to harvest it, would we? There aren’t enough people to fill up all this land, not by a hundred million. Look at a BLM map; probably 90% of it has no trees.

“We wouldn’t want to harvest it, would we?”

That would be bad for the environment. And it would encourage American workers to pursue livelihoods in the ecologically destructive timber industry.

“There aren’t enough people to fill up all this land,”

EGG ZACTLY.

That’s the crux of the biscuit. If I’ve said it once I’ve said it a thousand times…. There’s a globe full of worthless dirt and 95% of it goes undeveloped.

I remember reading, back when the Earth’s population was 5.5 billion, that if you took everyone and gave them 2 ft. x 2 ft. to stand in, you could fit them all in 800 square miles or roughly the size of Jacksonville, Florida.

There’s plenty of land, especially here in this country.

There’s plenty of land, especially here in this country.

And a lot of it is mountainous or arid. A major portion of the midwest breadbasket is dependent on aquifers that are running dry.

There’s definitely plenty of land out west, but the forested stuff around Flagstaff would get developed into subdivisions, why wouldn’t it? That’s my point about much of the west, one of the main ways it’s great to live in is because the government owns all that land, and the average person can access a lot of it. That wouldn’t be the case if it were all parceled out. Would there still be barren open tracts? Probably, but you wouldn’t be allowed on them. And all the stuff along the road would get developed somehow, as well as most any place scenic, unless the state or local government chose to take possession of it and hold it off the market or somehow restrict its use, in which case weŕe pretty much back at the same situation, just with a different level of government owning the land.

“And a lot of it is mountainous or arid. ”

And people live there anyways.

For every cherry picked exception you present as a generality, I’ll be there to correct it.

¨And people live there anyways.¨

Exactly. There would be houses everywhere.

no, there wouldn’t.

‘There would be houses everywhere’

Yeah, millions would emerge from the cardboard boxes and bridges they were living under to populate these houses.

¨millions would emerge from the cardboard boxes and bridges they were living under to populate these houses¨

True, location still matters, and few would want to live too far away from a population center, unless maybe they were truly giving away homesteads. But any beautiful area would be full of houses, or at least vacation houses of the rich. And private property. Land in less populated areas would be more sparsely settled, but someone would still own it, and probably not want you on it.

“And a lot of it is mountainous or arid.”

Got SoCal real estate?

“…millions would emerge from the cardboard boxes and bridges they were living under to populate these houses.”

Much like how any day now, the Chinese peasantry will make a mass exodus to populate the 60+ million empty investment apartment units in the recently-built ghost cities…

“location still matters,”

It does? Really?

Remember… “Location” is an old marketing technique to get your target to pay far more than the property is worth.

civil disobedience does not have to be public.

“civil disobedience does not have to be public.”

Not sure if you saw a link to it but dissent is not really crushed in China. One example was very bloody and haunting. A cop in some city in Red China beat up a man with a hammer - beat him to death publicly, because that man was documenting brutality the cop did to a woman earlier. The bystanders later ganged up on the similar cops - not sure if the cop responsible was part of this. But they kicked and punched all those cops to death, very bloody. About 4 cops. I guess I understand revenge. I hate contention and people getting hurt but the thugs from the Chinese government deserved it. Let that be a warning to statist thugs in any country, no matter how any country talks the talk of “we are a free nation.” That is all just talk.

Bill, the Chinese situation is way more complicated than you make it. From Wiki:

Following an incident in Tianmen City, Hubei province in January 2008 in which the manager of a construction company, Wei Wenhua,[6] was beaten to death for filming the actions of the Chengguan in a local dispute over rubbish dumping, nationwide calls were made to abolish the unit. Thousands of messages were posted over the Internet and protests took place in Hubei province. According to sources,[which?] some Chengguan officials have connections to organized crime. Chinese netizens compared Wei with Zhou Zhenglong, the protagonist in a South China Tiger photo incident .[citation needed] They commented, “Zhou filmed a tiger, he was alive; Wei filmed City Urban Administrative and Law Enforcement Bureau officers, he was dead. What does this suggest? City Urban Administrative and Law Enforcement Bureau officers are fiercer than the tiger!”[7]

Time magazine reports that beatings by chengguan officers have become such commonplace news that, “The word chengguan has even taken on an alternate meaning in Chinese. “Don’t be too chengguan” is an appeal not to bully or terrorize. In other words, chengguan has literally become synonymous with violence.”[8]

A 2012 report by Human Rights Watch documents Chengguan abuses, “including assaults on suspected administrative law violators, some of which lead to serious injury or death, illegal detention, and unlawful forceful confiscation of property.”[9]

There were multiple cases in 2011 and 2012 throughout China where police officers were attacked by groups of chengguan agents when responding to incidents of chengguan’s use of violence and abuse.[10]

In 2012, the chengguan agency in Wuhan announced formation of an internal ‘militia’ or paramilitary-type division.

In 2013, a watermelon seller, Deng Zhengjia, was reported to have been beaten to death with his own scales by Chengguan. His body was protected by people on the street to prevent authorities from seizing it and to “preserve evidence.” Violence ensued. Prominent microbloggers have called for the end to what has been termed a “thuggish” organization.[11]

In 2014, a man filming the Chengguan abusing a female street vendor was brutally beaten with a hammer till he was vomiting blood. He was pronounced dead on the way to the hospital. The 5 Chengguan officers were severely beaten, and four confirmed dead later,[12] with pictures posted on Weibo.[13][14]

The Chengguan officials used hammers because they don’t carry firearms. They’re not actually police as we might understand them. They even fight the local police.

Dear Auntie, still bitter that you can in no way get government to stop the marriage strike waged by men?

Still married with children / not on strike / trying not to be sexist!

Whac-A-Bubble: trying not to be sexist

Much appreciated +++

Men are not on a marriage strike. They are being rejected en masse by women who have no desire for a large child in her life. They are too egotistical to admit this, so they pretend to be “on strike”.

‘this degeneration in the nature of the debate’

Oh Jeebus, have you seen the Yahoo or CNN articles with 1,000 or 10,000 comments? Have you read them? It’s really awful stuff. Obviously lots of people are participating and I don’t see much whining about the “degeneration of the debate”. Everybody pines for the day when I spent 14 hours here deleting comments by the hundred. News flash: I have to make a living elsewhere, and the bits bucket is my gift to whoever chooses to participate. There’s a few things to remember; I used to not allow comments. It’s not so bad, and this blog will not be here forever. Stop being so thin skinned and appreciate what you have and the people involved while you got it.

I specifically wrote that it’s not your responsibility to police the discussion. You’re not responsible for things written by others. I don’t think that you should delete anyone’s comments at all.

Every once in a while someone demands that you banish someone else from participating. I think that that’s ridiculous. When people write nonsense, I respond by explaining it’s nonsense. I don’t demand that anyone be shut up.

So I’m not thin skinned. In fact, some of the extreme stuff that people write is quite interesting, because you don’t often find people in the real world openly saying such things.

“Stop being so thin skinned and appreciate what you have and the people involved while you got it.”

Sincere thanks from me!

For what it’s worth, I spend a lot of time writing half-posts and then saying “why bother” and hitting Refresh. As I’m sure Ben knows, “trying to put the core problems into words” is difficult and time consuming. I see no reason to spend the time articulating a position, or giving examples, or doing a little math, if the responses that I get back are “you’re a debt donkey”, “you elitist pig,” “How many hundreds of thousands have you lost today” or “if you haven’t peaked a fourteener by 11 am you’re worthless.” It’s the same stuff round and round.

Comment by oxide
2014-05-31 20:22:31

For what it’s worth, I spend a lot of time writing half-posts and then saying “why bother” and hitting Refresh. As I’m sure Ben knows, “trying to put the core problems into words” is difficult and time consuming. I see no reason to spend the time articulating a position, or giving examples, or doing a little math, if the responses that I get back are “you’re a debt donkey”, “you elitist pig,” “How many hundreds of thousands have you lost today” or “if you haven’t peaked a fourteener by 11 am you’re worthless.” It’s the same stuff round and round.

Stated perfectly. Waiting for “cheetos!” response.

‘I spend a lot of time writing half-posts and then saying “why bother”

Do you know how many of those I’ve done these past 10 years? I probably still do 4 or 5 a day.

“For what it’s worth, I spend a lot of time writing half-posts and then saying “why bother” and hitting Refresh.”

Now that is priceless. Boo friggin hoo….

How many times have you deliberately run from, ducked from and flat out ignored very basic but fundamental questions here?

You get exactly the opposite of what you’re seeking here. That will not change. Ever.