patrick.net

P2D2 says

Well, Cisco is spending its cash somewhere else.

Unfortunately the US based managers making the shift to India and rest of Asia
are not US born folks. Yes I know these people. To me its akin to dismantling
our US economy by foreign interest parties and no one is stepping back to really
ask the important question.

Yes I do sound fascist here but no one is asking questions like 'why are you really
doing this?'. No the Soviet communist didn't win, but this is what it would feel like
had they won. East Germany and the rest of Soviet block was drained of resources.

Well, today I was driving around a townhome development I was interested in. Come to find out, it had speed bumps, those worthless things aren't good for cars!! Anyway, I called an agent and he asked what price range I was looking in. Well, little did I know, he just wanted to attack me (found this out after I told him). He said, "Well these places won't go for less than that." I thought, Buddy, you need to get your head out of your a**. Then this crackhead who is selling his place on his own for $179,000, $50,000 above asking price for most of these places, thinks he can get that much for a townhome!! I can't wait until things collapse. Time to knock some sense into these idiots!!

wish i was lucky says

We can’t even begin to compete. If they come over here - they can still work for less than we can and send the money home

Naturally, any country with higher professional costs "can't compete" merely on that labor level with developing countries who have a surplus of recent graduates. So what's the solution here...outsourcing your workforce to stay fiscally "competitive", which will further sag the economy--or raise your product to a higher level? I think of the "cheap way out" as the lazy solution because it puts the emphasis on labor vs. product, and is ultimately a dead end when developing nations compete directly against you.

I'm not a protectionist per se, but we need to think of our citizens and our larger strategy. If roles were reversed, and Americans were displacing jobs somewhere, would those citizens would just write it off as globalism? Dunno.

When Americans stop buying cheap crap made by outsourced labor, then I might begin to believe those same Americans give a damn about something besides saving a few bucks on garbage and about keeping jobs in this country.

You have to be certifiably out of your mind to want to live anywhere in the filthy, smoggy gang-infested rat's nest known as the Inland Empire. What possesses people to want to live under a constant smog blanket is beyond me. But then again, there is a lot of STUPIDITY out there. God help you.

chrisborden says

When Americans stop buying cheap crap made by outsourced labor

Yeah, there's quite a bit of useless crap out there. I've really cut back on buying useless junk, like the latest gadget. When I do buy something I look for where it was made. If I can buy a US-made product of comparable quality, I will. I'm sure I'm not the only one.

Dear wish, I cannot disagree with anything you say. Did you read the recent article about the hapless homeloaners in Florida who can't live in their homes because the crappy Chinese sheetrock gives off toxic fumes and corrodes plumbing? Seems the builders couldn't (wouldn't?) find quality American products and so went the cheap way during the building boom of the early 2000s. (By the way, your observation about the former farming paradise that was the Inland Empire is correct. Why do human beings insist on paving over productive farmland with parking lots, strip malls and crappy houses and then proceed to import the produce we used to grow there? That land can never be recovered for food again. We are starving ourselves in the wanton pursuit of greed and materialism.)

Our country is moving closer and closer to protectionism...Which of my policies do you agree with?

Yes, we need to bring jobs back to America
Yes, America is for sale..name your price
Yes, the home prices will be reset to pre-2000
Yes, we need to regulate corporations, healthcare

No, we cannot fund GDP with our home equity
No, we cannot continue the trend of offshoring
No, you should not buy now
No, home prices will not skyrocket again....ever

We are moving closer and closer to protectionism?

How do you get, that? Perhaps if we poll public sentiment, but it is not the reality.

We hit bottom a long long time ago. What's amazing to this former native Californian is how many idiots refuse to see it. The U.S. is indeed for sale to the highest bidder.

wish i was lucky says

The farmland is laying fallow for one big reason WATER. Have you not been reading? When there is a drought - the water goes to the homes and not to the farmers. Or the farmers sell their water allotments. Our water supply cannot support the amount of homes we now have AND the farmers.

Well, there is the case with California orchards during recent droughts, where water was rationed but not cut off completely. I seem to recall that Sac valley residents were rationed first to help protect the almond farmers. Orchards are an exception, because they need so much water to be viable next season. And, fallow land can be a normal cycle w/ seasonal crops to replenish the soil. They'll grow a high-yield crop, then plant alfalfa and till that under to replenish nitrogen. Those are just some details I'm aware of.

I think we'll have better luck balancing water needs between ag and cities when residential/business are not so water-dependent for landscaping, such those as heavily watered lawns around business parks and homes in otherwise arid areas. Golf courses in deserts is another idea which deserves close scrutiny.

One of the main reasons I quit CA is that it (along with some other highly urbanized war zones) exceeded its carrying capacity years ago. I do believe California's problems are unsolvable as long as the state remains a reservoir for society's garbage and its residents refuse to pay their bills. California is bankrupt in every way. Why do people want to live there?

A lot of suckers are showing the same desperation and paranoid characteristics that led sheeple to believe that you had to buy now or be priced out forever. Any realtor scum you deal with will tell you ALWAYS that this is the best time to buy, that prices have dropped and people are sensing on opportunity and that homes are flying off the shelves.
I believe that there is only one reason for buying now and that is if the dollar will be destroyed with another few rounds of bailouts that helicopter Ben and Obama are already planning to flood the economy with. So if the realtor says that the markets are hot but the Fed and the govt. are of the opinion that more liquidity ( read printing ) is needed to ease the crunch, who would you believe ? Are'nt they supposed to be in cahoots ?
I do not blame realtors or the banks or even the govt, only the greedy buyers who are the main reason for loans going bad. We need to bring back debtors prisons and exclude mortgage debt from being written off just like student loans. Stupid buyers are the only reason we continue to witness this madness.

Wish I Was Lucky:

I am adding your manifest to my list:

Here are my immigration laws:
1. If you migrate to this county, you must speak the native language
2. You have to be a professional or an investor. No unskilled workers
allowed.
3. There will be no special bilingual programs in the schools, no
special ballots for elections, all government business will be
conducted
in our language.
4. Foreigners will NOT have the right to vote no matter how long they
are here.
5 Foreigners will NEVER be able to hold political office.
6. Foreigners will not be a burden to the taxpayers. No welfare, no
food
stamps, no health care, or other government assistance programs.
7. Foreigners can invest in this country, but it must be an amount
equal to 40,000 times the daily minimum wage.
8. If foreigners do come and want to buy land that will be okay, BUT
options will be restricted. You are not allowed waterfront property.
That is reserved for citizens naturally born into this country.
9. Foreigners may not protest; no demonstrations, no waving a foreign
flag, no political organizing, no badmouthing our president or his
policies, if you do you will be sent home.
10. If you do come to this country illegally, you will be hunted down
and sent straight to jail.
Harsh, you say? The above laws belong to the immigration laws of
MEXICO!

Here is my new laws:
1. If 1 gangbanger commits a crime, then they all commit a crime. Charge them all with murder for the one individuals crime
2. Cancel all welfare, healthcare for illegal immigrants
3. Place the military at the CA and TX borders, gun down anyone attempting to cross illegally…especially Native Americans like myself trying to re-enter my very own land.
4. Legalize any illegal immigrants willing to pursure a Masters Degree in college and learn extremely fluent ENGLISH
5. Cut off welfare benefits for anyone after 18 mos, if you havent found a job after 3 years then you just aint trying
6. Setup a tent city in Mexico for the lowlifes who refuse to work or pursue higher education in our country. Force them to rebuild the infrastructure of Mexico at minimum wage
7. Demilitarize Russia, China and any other country that is a immediate threat to the security of the United States.
8. I would bomb these countries back into the middle ages because they represent the #1 challenge to our national security.
9. Round up all Crips, Bloods, KKK, Mexican Mafia and send them to live in the tent cities of Mexico to work at minimum wage.
10. Shutdown all drug trafficking by bombing Columbia, Mexico and France as necessary, then legalize Marijuana for the tax and license profits.

Nomograph says

Did you know that CA has the ninth largest GDP in the entire world? It’s kind of hard to make the argument that CA is circling the bowl when in fact we are a global economic powerhouse.
California holds plenty of opportunity, but it is also highly competitive and requires hard work and smarts to make it here. While you were sitting around wishing you were lucky, others were earning their fortune in this world

While the prices of farm products over the years have gone up with rate of inflation, with spike and declines indicating volitity,
tech has seen declining Avg selling prices due to competition. An Apple from central valley has gone up, while the Apple from Cupertino has gone down.. and while everyone still want to buy an apple from Central valley and there is competition from other apple makers prices still goes up. The other Apple in Cupertino which has demand and has competition prices keep falling and weaker on supporting costs.

As some recall the Apple from Cupertino almost went belly up and didnt make it back in the early 90s while the Apple in Central Valley was still doing well.

Is anybody aware that CA is perpetually bankrupt? What opportunity is there?

I'm just starting to see capitulation in my area. But, when a house goes up 100% between 2001 and 2007, is a decline of even 30% really a "bargain"? A $100,000 house increasing at 4% per year would be worth just over $136,850 in 9 years. If the same house doubles over 7 years (to $200,000) then falls a total 30% over the next two (to $140,000) the difference between the two is small (just over 2%). But I still can't wrap my brain around how the first time home buyers (which make up a majority of the sales in my area right now) are doing it... even with the tax credit and the low FHA down payment requirement. Or rather, I know how they are doing it, but I can't fathom how they can sustain it long-term, given the monthly payment that would be incurred as compared to the incomes of the area.

I'm just starting to see capitulation in my area. But, when a house goes up 100% between 2001 and 2007, is a decline of even 30% really a "bargain"? A $100,000 house increasing at 4% per year would be worth just over $136,850 in 9 years. If the same house doubles over 7 years (to $200,000) then falls a total 30% over the next two (to $140,000) the difference between the two is small (just over 2%). But I still can't wrap my brain around how the first time home buyers (which make up a majority of the sales in my area right now) are doing it... even with the tax credit and the low FHA down payment requirement. Or rather, I know how they are doing it, but I can't fathom how they can sustain it long-term, given the monthly payment that would be incurred as compared to the incomes of the area.

My bottom line is that all of the government intervention means that we are probably closer to bottom than I want to believe, but I can't help but think that a second downward leg is coming... all the data that I have seen certainly supports that theory, but I can't help but recognize I have a strong bias towards that data which supports my hypothesis.

Tude says

I don’t think we will hit bottom until the incentives are gone. Too much government involvement in the way of tax credits and FHA BS loans for us to find a true bottom. They want you to think this is bottom and buy, but I refuse to until the monkey business with housing stops.

I agree with Tude on this one. Prices in the zips I'm watching have gone up only since the extension of the $8k tax credit/gift/loan or whatever the h*ll they call it.

My understanding is that they want to increase the amount to $15k or even $30k. Not sure, however I am viewing this as catering to the homeowner vote.

Too much manipulation for me.

~Misstrial

The more i read these threads the more i believe that our leaders are a bunch of idiots. Someone said in a earlier thread we have a 2 party system:

The Government vs The People

...and they were right.

The People have forgotten that they are (were) The Government. Now the governors have enslaved the governed in the name of "sell the country to the highest bidder" with the latter's willing consent. It's as simple as that.

Stop re-electing thieves to Congress and clean house, get educated, follow your government's business, read real books about government and politics, stop watching controlled media and corporate television (PBS is brain food), get informed, exercise your right to redress grievances (it's in the Bill of Rights until they steal that one), get off the couch, yell and scream, write letters to the editor, write to your Congress members about how you feel on major issues and watch how they vote (make them accountable) and above all, BE A THINKER, NOT A PASSIVE SHEEP. Untie yourself from the bonds of corporate America. Buy green stuff, buy at the farmers market, walk whenever you can. Don't buy Chinese crap, buy American. You will pay more but get lasting quality. Question everything you believe, and ask yourself why you believe it. Pay attention, use your senses. THINK and ACT. Stop being a pacifist, stop listening to the pundits and the raving lunatics on both sides. Become a political agnostic. Don't think like the crowd. Is that enough?

thunderlips11 says

“Probably it has gotten to the point that it has because BIG Business would rather we paid for the Benefits.”
That’s right wish. The whole stuff about the fence is nonsense, just a handout to the M.I.C.. The way to stop illegals is to RICO act Agribusinesses, Meatpackers, Landscapers for conspiracy to violate employment laws. Also, discrimination lawsuits by native born Americans of all races for ethic preferences. Mix together a few executives of Tyson Chicken with a few local contractors here and there, make them do the perp walk, and watch the redistribution of jobs to the legally employable. Illegals will then remove themselves without deportation. Also, require naturalization papers or birth certificates to receive benefits.
Businesses that use unskilled labor love illegals because they’re easily intimidated, don’t stand up for themselves, will work for peanuts, and if they get hurt, the taxpayer pays the tab for the hospital or disability or welfare. It’s a great illustration of externalities.
And of course, it depresses wage scales for our own unskilled people, making it harder for them to support or improve themselves.

excellant post

1 year ago my wife & I almost bought a house here on the peninsula. We thought it was a good deal on a bank owned property. We had a 5.1% rate 30 year conventional loan, etc. etc. Good K-5 schools for our kids, etc. etc.

One of the first things that spooked me was when our realtor told us that he had a interest only loan on a $1M house in San Francisco that was about to re-set to a double digit interest rate, and he was barely getting by on the monthly payment as it was. When asked he was "not too worried about it" when I asked what he planned to do about it, I knew then I couldn't trust a frigging word that came out of his mouth when it came to representing our interests as buyers. a) he was an idiot b) he'll do or say anything to get the sales commission from me.

I am going to go out on a limb here and suggest that the tax credit for buying a house will become permanent. I do not see how they could believe they have any other choice to help keep housing prices artificially inflated. They have already told me as much and Mr. Frank already told the whole world that making home ownership acquirable was America’s policy. I am paraphrasing him as I disagree with is you use of the term affordable.

I have always heard that during its inception Social Security was suppose to a temporary solution and was never meant or originally designed to be a long-term or permanent solution. I have never verified this, but given how Social Security is working it clearly was never designed to be enduring. This is my basis for believing generations from now no one will even have a concept of the fact that the housing tax credit originally was a temporary solution. It will be taken for granted that it was always intended to be permanent and they will start complaining about is failure when the cracks are too wide to be ignored.

Why are we trying save Social Security if it was only ever meant to be temporary? It’s a rhetorical question. Accept it the housing tax credit and all its problems are permanent.

The artifical bottom is permanent policy.

it's a bit local. I was shopping for a rental house in Oakland this time last year and there was plenty to choose from in the 100k range.

Now it's slim pickings and anything halfway decent is in the 150-180k price range.

I'm thinking the best time to buy was back when prices were falling with "no bottom in sight"

toothfairy says

it’s a bit local. I was shopping for a rental house in Oakland this time last year and there was plenty to choose from in the 100k range.
Now it’s slim pickings and anything halfway decent is in the 150-180k price range.
I’m thinking the best time to buy was back when prices were falling with “no bottom in sight”

This time last year may have been the best time to buy in Oakland.

wish i was lucky says

So my next question is - who is/was supposed to live in all these monster homes that were built? What was the master plan??

The mcMansions of today will become the multigenerational housing of tommorrow, as nature intended. When you really think about it, McMansions are perfectly suited for this task.

toothfairy says

it’s a bit local. I was shopping for a rental house in Oakland this time last year and there was plenty to choose from in the 100k range.
Now it’s slim pickings and anything halfway decent is in the 150-180k price range.
I’m thinking the best time to buy was back when prices were falling with “no bottom in sight”

Most of these were probably bought by cash only investors. What happens when no one buys the flip or when they can't be rented? Exactly. I hear jobs in that target demographic are soaring (not).

Dead cat bounce IMO.

pkowen says

This time last year may have been the best time to buy in Oakland.

At least until next year. I wonder how much of the Oakland surge pushing $100k homes to $150k was caused by fraudulant use of the $8k tax incentive. When that expires, will we see a fall?

Or is it a new high demand for lower priced rental property, fueled by all those step down former homeowners?

tarkin says

I have always heard that during its inception Social Security was suppose to a temporary solution and was never meant or originally designed to be a long-term or permanent solution.

yeah, well you've always heard wrong. From 1937:

"Example: A factory superintendent 40 years old makes $3,000 per year; his annual tax to begin with will be $30 (1% of $3,000); the factory management must match his $30 with another $30 and the $60 will be turned into the Treasury to build up the Old-Age Pension Fund; at 65 the factory superintendent may retire to draw a maximum of $62.50 each month from the Government. Though the Federal Social Security Board in Washington has been working quietly for months with plans to inaugurate this vast pension scheme in 1937, few wage earners were aware until last week of the practical details of the plan as it affected their pocketbooks. "

Read more: http://www.time.com/time/magazine/article/0,9171,756827,00.html#ixzz0b0TSgNKy

to see the Republican scare-mongering that was ever-present even back then.

"I have never verified this, but given how Social Security is working it clearly was never designed to be enduring."

SS is working fine now. Taking more than $150B/yr than it is paying out, and has been for decades since the Greenspan Commission raised FICA contributions in the mid-80s. As a retirement program, it is sitting on $2T on the safest savings imaginable -- US bonds. As an enforced savings program, it is a howling success, though it is something of an welfare program as lower-income pensioners will take out more than they contribute.

To fix Social Security permanently, we'll have to increase its income transfer by jacking up taxes on either high earners, more fairly by increasing taxes on everyone, or enacting means-testing on benefits, or capping payouts to keep the fund in balance once it begins drawing down the money the General Fund owes it.

But I agree that the $8000 credit just might become permanent. It is difficult to find a "temporary" measure taken by the gummint that doesn't stick around somehow.

Troy says

But I agree that the $8000 credit just might become permanent. It is difficult to find a “temporary” measure taken by the gummint that doesn’t stick around somehow.

I somewhat agree on this too. What I am expecting is another extention of that $8000 credit after Apr. 2010. I'd rather prefer seeing those BS fees like loan origination fee and 6% realtor commision is being cut into half, rather than making $8000 credit permanent though.

Troy says

keep the fund in balance once it begins drawing down the money the General Fund owes it.

Ah the magic words and the crux of the problem. If the general budget has been billions in the red every year for the last 30 years, how will the general budget not only balance the books all of a sudden, but find enough money to pay back 30 years of stealing from social security? The 2T in bonds held by social security is simply an IOU from one branch of government to another. THERE IS NO MONEY. YOUR MONEY FOR SOCIAL SECURITY HAS BEEN STOLEN. The majority of it is now invested in tanks, planes, submarines, military bases all over the world, and the deserts of Afghanistan and Iraq.

You would have to eliminate the entire federal government except for interest on the debt to actually make this work. Or convince foreign investors to kick in another 2T to help America live beyond her means. Or default on all Tbills except those owed to SS. Or devalue the currency by something like 95%. It's going to be a rocky road.

bob2356 says

THERE IS NO MONEY. YOUR MONEY FOR SOCIAL SECURITY HAS BEEN STOLEN

Nah, the Greenspan plan was to cut taxes on the upper class so they could invest it in better wealth-accruing enterprises than government.

There is plenty of money -- the super-wealthy have it. Table L.10 Assets and Liabilities of the Personal Sector of the Federal Flow of Funds report lays it out -- the private sector has $40T in assets against $20T in liabilities.

Right now 10% of the country controls 60-70% of the wealth. Cutting this back to 40-50% isn't going to be that big a deal, other than the great caterwauling we'll get from the super-wealthy's media and thinktank mouthpieces.

thomas.wong89 says

or manybe pissed away by Congress on social programs before 911 ?

Nope. Maybe not.

“THERE IS NO MONEY…”

One could argue that:

There never has been, and never will be.
or
There always has been, and always will be.

Social security funding is just a numbers game.

The reality is that people working now must produce the real goods and services consumed by people on Social Security now.

People working in the future must produce the real goods and services to be consumed by people on Social Security in the future.

Which pot of fiat currency is used to purchase those goods and services is a secondary factor, and an accounting construct.

If the nominal fund balance is insufficient, then we can just print more currency to buy the real goods and services needed. The real goods and services will be a real drain on workers no matter how we "fund" our Social Security system.

CrazyMan says

toothfairy says

it’s a bit local. I was shopping for a rental house in Oakland this time last year and there was plenty to choose from in the 100k range.

Now it’s slim pickings and anything halfway decent is in the 150-180k price range.

I’m thinking the best time to buy was back when prices were falling with “no bottom in sight”

Most of these were probably bought by cash only investors. What happens when no one buys the flip or when they can’t be rented? Exactly. I hear jobs in that target demographic are soaring (not).
Dead cat bounce IMO.

dead cat bounce huh? Let's hope so. The thing about paying all cash is that there's no pressure to rent it out. But the fact that these were halfway decent properties in Oakland the chances of it not being rented are pretty slim.
I could be wrong but somehow I dont think we'll be seeing those rock bottom prices again anytime soon.

thomas.wong89 says

bob2356 says

The majority of it is now invested in tanks, planes, submarines, military bases all over the world, and the deserts of Afghanistan and Iraq.

Are you saying SS was in the black before the year 2000 ? or manybe pissed away by Congress on social programs before 911 ?

SS and medicare are still in the black and still paying part of the deficit. Congress just writes an IOU to SS/medicare every year and spends the money. Over 60% of the budget (without adding in SS/Medicare as they are funded separately) is military (if everything was accounted for properly), so over 60% of the pissing away is military. Pop quiz, what percentage of the federal budget,, is "social programs". Hint, interest on the debt is half of what's left over after defense.

Back to the original point, the latest Case-Shiller Numbers (released today, from October, 2009) idicate that :

All in all, this report should be described as flat.” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s.

Case Shiller Index

Press Release