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Old 08-09-2007, 05:11 PM   #61
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Curious.

What is going on in Detroit? Auto worker layoffs? Loans to low-income immigrants?

500 Top foreclosure zip codes - Jun. 19, 2007

There was a very good profile of the Detroit problems a few days ago on Yahoo....will post link if I can find. It profiled one block of a fairly upscale neighborhood which I am familiar with. It seemed like most the homeowners had no clue what they had done......I recall the loan terms to be as much as 8.75% BEFORE resetting to >12%! Even with that, the loan amounts were fairly small (~$250k), so it did not add up in my mind. One guy was a 42 yo "investment banker"...........with a subprime loan I think its likely than many of these folks should have qualified for better loans.

Here's the link:'Subprime' Aftermath: Losing the Family Home - WSJ.com
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Old 08-09-2007, 07:51 PM   #62
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Thanks for the link. The story's an accurate description of the problem. Sub-prime loans, along with disappearing jobs, pretty much sums up what's happening to a once thriving city.

When I was a kid, I remember my parents taking us for Sunday drives down Outer Drive (the street in the article) to show us where "all the rich folks lived."

Sad, sad, sad...
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Brave New Economy
Old 08-10-2007, 12:44 AM   #63
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Brave New Economy

Is it possible for a state or a nation to prosper in an economy based increasingly on services?
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Old 08-11-2007, 11:57 AM   #64
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Is it possible for a state or a nation to prosper in an economy based increasingly on services?
Well, you've hit upon a very key discussion point in economic circles. I'd recommend a new thread about this.

My answer, "yes, but it depends on which services are predominate". FWIW, some of the most prosperous countries in the world do very little to no manufacturing, Switzerland and Monaco come to mind as examples. Or within the US, think Aspen.
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Old 08-11-2007, 12:51 PM   #65
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Well, you've hit upon a very key discussion point in economic circles. I'd recommend a new thread about this.

My answer, "yes, but it depends on which services are predominate". FWIW, some of the most prosperous countries in the world do very little to no manufacturing, Switzerland and Monaco come to mind as examples. Or within the US, think Aspen.
I think there must be a certain conditions for a prosperous service economy. Some are: Relatively small country and small population. A history of letting both foreigners and citizens mind their own business. An intelligent well educated population. A certain degree of informed practicality in the political process. Very good immigration and border control. Low crime rates and low governmental and business corruption. (Contrast the service economies of Bermuda or The Bahamas to Jamaica or Haiti or Dominica.)

The US has energy needs alone that doom us to needing a lot of energy and natural resources. If we can't produce them, we need to go to war to "facilitate their sourcing". So we get what we have now, a nation going down the tubes with what might be a terminal disease.

Ha
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Old 08-11-2007, 02:38 PM   #66
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I think there must be a certain conditions for a prosperous service economy. Some are: Relatively small country and small population. A history of letting both foreigners and citizens mind their own business. An intelligent well educated population. A certain degree of informed practicality in the political process. Very good immigration and border control. Low crime rates and low governmental and business corruption. (Contrast the service economies of Bermuda or The Bahamas to Jamaica or Haiti or Dominica.)

The US has energy needs alone that doom us to needing a lot of energy and natural resources. If we can't produce them, we need to go to war to "facilitate their sourcing". So we get what we have now, a nation going down the tubes with what might be a terminal disease.

Ha
Well, for a nation going down the tubes there are plenty of people clamoring to move here, taking incredible risks to do so I might add.
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Old 08-11-2007, 03:03 PM   #67
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Well, for a nation going down the tubes there are plenty of people clamoring to move here, taking incredible risks to do so I might add.
Have you visited the places where they are coming from? Have you seen their homes, what their lives are like?

Think these folks are going to make USA more like Monaco and Switzerland?

Ya shur, you betcha!

Ha
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Old 08-11-2007, 05:18 PM   #68
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Curious.

What is going on in Detroit? Auto worker layoffs? Loans to low-income immigrants?

500 Top foreclosure zip codes - Jun. 19, 2007
probably what is going on there is the same thing going on in the rest of the country. i wouldn't say just loans to low-income immigrants. but from what i see from the zip codes of the florida contingent, foreclosures are hitting hard low-income of all sorts.

if i get a dose of ambition flowing through my veins any time soon i'm going to study further and even survey areas hardest hit in south florida. from what i've seen so far from a quick glance at cnn's top 500 foreclosures, the list is both deceiving and telling.

it is telling in that a quick map study of zip codes in areas of which i am familiar show that these are mostly long-established "black areas" of town, where many african americans reside. i hope i am not being offensive with the term "black area of town" and feel free to correct me, but what i have noticed since i was a kid is how very racially segmented florida (& likely the rest of this country?) is. i remember when i was a kid how i didn't understand why even the middle class areas where so divided. i always thought that money was money. but often it seems it isn't.

the part deceiving involves how cnn lists fort lauderdale 7 times when only 3 of those 7 zip codes are actually within the city of fort lauderdale. the majority are in other cities.

33313 is lauderhill
33319 is lauderdale lakes
33321 is tamarac
33351 is sunrise

of the three correctly identified zip codes

33311 is a lower economic class black area west of i-95
33309 is a lower economic class mostly white area bordering the executive airport
33312 is a somewhat mixed transition area (transition in economic, not racial status) on the w side of i-95 & n side of i-595 at the nw corner of fort lauderdale hollywood international airport.

just wanted to verify my preliminary assessment and this is what i find according to city data.com Stats about all US cities - relocation info, maps, race, income, photos, education, crime, weather, houses, etc.

of the fort lauderdale areas mentioned on the list:

33312
White population: 25,975
Black population: 15,512

33309
White population: 18,849
Black population: 11,446

33311
White population: 7,693
Black population: 53,226

my zip code which did not make the list?
White population: 10,675
Black population: 649

so at first glance it seems a clear cut black & white issue. but then on further study of the mislabeled areas which are not in fort lauderdale:

33313
White population: 13,468
Black population: 38,624

33319
White population: 24,940
Black population: 14,512

33321
White population: 33,740
Black population: 2,907

33351
White population: 22,499
Black population: 5,938

perhaps the statisticians here will be able to illuminate further if there is any pattern pertaining to race. when i get a chance i will check out the other zip codes mentioned by cnn.
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Old 08-11-2007, 06:13 PM   #69
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Is it possible for a state or a nation to prosper in an economy based increasingly on services?
I think that the existence of this Board is an argument that there is a shift in that direction. I think that many people on this board are interested in ER because they now value experiences, which frequently have a service component, more than accumulating more stuff, e.g. buying manufactured consumer goods.

MB
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Old 08-12-2007, 12:51 AM   #70
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In the USA, the services are going to be, by an overwhelming percentage, in traditionally low-paying fields, e.g. food prep, cleaning, low-level retail & clerical.

We need a lot more cooks than CMOS design engineers and the engineers can be in Bangalore at that.
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Old 08-12-2007, 01:57 PM   #71
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I think there must be a certain conditions for a prosperous service economy. Some are: Relatively small country and small population. A history of letting both foreigners and citizens mind their own business. An intelligent well educated population. A certain degree of informed practicality in the political process. Very good immigration and border control. Low crime rates and low governmental and business corruption. (Contrast the service economies of Bermuda or The Bahamas to Jamaica or Haiti or Dominica.)

The US has energy needs alone that doom us to needing a lot of energy and natural resources. If we can't produce them, we need to go to war to "facilitate their sourcing". So we get what we have now, a nation going down the tubes with what might be a terminal disease.

Ha
we have enough natural resources for ourselves, and then there is Canada. we just choose enviromentalism and to let others pollute their nations for a few $$$
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Old 08-12-2007, 02:16 PM   #72
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Is it possible for a state or a nation to prosper in an economy based increasingly on services?
why not? 20 years ago to listen to music you had to buy a CD. today it's a service to download it into your Ipod. Wikipedia is a replacement service for physical encyclopedias

i bet if you think about it, there are a lot of services that are simply replacements for physical products of past decades. a lot of things like consumer electronics might be made in China, but the supply chain is complicated
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Old 08-12-2007, 06:38 PM   #73
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In the USA, the services are going to be, by an overwhelming percentage, in traditionally low-paying fields, e.g. food prep, cleaning, low-level retail & clerical.

We need a lot more cooks than CMOS design engineers and the engineers can be in Bangalore at that.

I think you are vastly underestimating the ability of American firms to export services and get very well compensated for them.

Take something like the iPOD, AFAIK they are all manufactured in China,but virtually all of the profits flow back to Cupertino based Apple. The money goes to pay not only the design engineer responsible for the electronics, but the packaging folks who figure out the new color schemes, the human factors engineer who make it easy to use, the lawyers who ink the deals with recording companies, the marketing folks who create demand for iPOD among aspring Yuppies in India, and China. In fact, my understanding is that revenue of iPOD sales in countries like China and India exceeds the manufacturer cost Apple has paid..

I've invested money in start-up that is creating off shore tax shelters for Japanese business. You see American style agresssive tax avoidance is pretty much unheard of in Japan. So it has taken a team of American bankers, lawyers, and tax accountants to convince the Japanese companies they can save billions to set up operation in countries with low-tax rates. A huge amount of the tax revenue that Japan loses will flow to these American "service workers" And hopefully to this investor

You are probably right that most of the service jobs will be relatively low pay. However E-Bay retailer is a job description which didn't exist a decade ago, doesn't require a degree and can be extremely lucrative and it is basicallly a service job.
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Old 08-23-2007, 04:20 AM   #74
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A recent article on areas of the country and real estate sales

http://finance.yahoo.com/real-estate...ousing-markets
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Old 08-23-2007, 12:51 PM   #75
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A recent article on areas of the country and real estate sales

http://finance.yahoo.com/real-estate...ousing-markets
I guess this article reinforces my local experience here in Raleigh NC:

"Raleigh prices jumped 8.3%." Slightly less than the 8-something percent increase in Seattle and San Jose, CA.

Our neighborhood email list has been abuzz lately with news of houses selling quickly. I have seen multiple places put up for sale signs early in the week with "OPEN HOUSE SUNDAY 2-4 PM" notices. Then later in the week the "OPEN HOUSE" signs come down. Shortly thereafter, the "CONTRACT PENDING" sign goes up. As it turns out, they sold these houses in a few days before the open house could even be conducted. The prices haven't really skyrocketed, but there definitely seems to be a lot of demand. This is in a mid to lower end neighborhood where houses are $140,000-$180,000. Back in 2003 when I was house hunting, most places were selling in the $120,000-$150,000 range. Houses here are still affordable for working class families.

New construction seems to be occurring as fast as builders can throw up 4 walls and a roof.
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Two foreclosures sold
Old 08-23-2007, 05:51 PM   #76
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Two foreclosures sold

as well as another house, but another comes on the market whenever one is sold. Inventory is 6-7%, most of them for over a year and very slow moving.
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Old 08-23-2007, 06:07 PM   #77
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Here in my 'burb of Seattle, the last "hot" market in the country, we just had a local builder file BK because his high-end condos weren't selling and he couldn't pay his construction loan.

There's a pretty good blog on our market here:

Seattle Bubble

Interesting graph of our increasing prices and decreasing sales follows. Looks like a classic case of demand falling as prices increase. And we know how that will end....

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Old 08-23-2007, 06:39 PM   #78
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I remember going back to my small home town in southern Wisconsin in 1980; almost every house in the neighborhood was up for sale. But think about the reason: the neighborhood was built during WWII and most people bought there by 1948; most had either died or retired (mainly to Florida). Aren’t we already in or approaching another transition of that nature?


San Francisco:

Got an e-mail in late July from a 35-year-old, wife and two toddlers, giving new address. I may be the only one in his address book who knows for sure that the address is his wife’s mother’s condo. He’s in the construction business (cement I think) and in the past has had disability for injury but I don’t know the current story.

Thought it would never happen, the guy with the penthouse/spectacular view apt. in my building has given up his tenancy. He has worked out of the country for many years, was sub-letting and using it as an occasional pied-a-terre. Landlord had grounds for eviction but I don’t know for sure if he used them. Will be interesting to see how long it takes to remodel and re-rent it (that is if I don’t get the boot first).

The two-bedroom condo across the street is still on the market for $1,999,000 (down from $2,225,000), I think the RE agent has been on vacation the last two weeks; seems like they have been having open house every Sunday for months. I remember (was it 10 years ago) when the condos on my block were going for about $775,000 and I think that’s high enough.
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