Very Intersting RE Bubble Perspective - The Fool Strikes

[al_bundy]

Quote:

Originally Posted by wab Maybe. *When prices dropped in CA after the last bubble, I had to go to the county assessor's office to submit a challenge to their assessment. * It lowered my property taxes, but it wasn't automatic. No, they'll probably just raise the property tax rates. * *The really sad thing about it is that when they get a tax windfall, they usually give themselves an irreversible pension benefit increase. * At least that's what happened during the tech bubble, and we're just starting to see the fallout now.

the usual excuse is we need to hire qualified people. i remember i did a paper about pension benefits in school a few years back and this was the excuse they used in san diego back in 1996

[astromeria]

Quote:

Originally Posted by al_bundy the usual excuse is we need to hire qualified people. i remember i did a paper about pension benefits in school a few years back and this was the excuse they used in san diego back in 1996

Funny, that's the same excuse used to justify executive compensation

[Helena]

A Few More Thoughts on the Housing Market

September 1, 2006

John Mauldin

Given that real estate, in one form or another, accounted for about one-third of the jobs created in this last recovery, this does not bode well. Nor does the fact that home equity loans accounted for the bulk of the increase in consumer spending in recent years.

How ugly will it get? Not as ugly as in past cycles, as I think the Fed will once again step in and cuts rates aggressively. But it could be uncomfortable if you have the need to sell. However, if you are in the market to buy, it could be a great opportunity. Stay tuned.


http://www.2000wave.com/article.asp?id=mwo090106

[al_bundy]

Quote:

Originally Posted by astromeria Funny, that's the same excuse used to justify executive compensation

people aren't forced to pay executive compensation like they are forced to pay government pension benefits. some places people are paying crazy property taxes just to pay the benefits. if i don't like a company, i just don't buy their products.

[honobob]

Quote:

Originally Posted by al_bundy people aren't forced to pay executive compensation like they are forced to pay government pension benefits. some places people are paying crazy property taxes just to pay the benefits. if i don't like a company, i just don't buy their products.

If you don't like the government........................................ ..

[astromeria]

Quote:

Originally Posted by al_bundy people aren't forced to pay executive compensation.

They are if they're stockholders.

Reminds me of today's Ben Stein article:
http://tinyurl.com/rz3qh

[al_bundy]

Quote:

Originally Posted by honobob If you don't like the government........................................ ..

i can sell a company's stock

with some local governments there are so many people on the payroll, anything that cuts the budget is quickly attacked and voted down. only solution is to move.

[Brat]

Interesting article in the San Jose Mercury News today (10/26/06) "Real estate 'agent bubble' deflates as home sales slow".

http://www.mercurynews.com/mld/mercu...s/15852383.htm

Also a comment in a construction trade publication that concrete prices are decreasing because of less demand.

[audreyh1]

Quote:

Originally Posted by al_bundy someone has to be able to afford it in order for it to have value. too many people cannot afford starter homes today. Median price is around $230,000. This means 10 years from now a starter home will be close to $500,000 and the median family income will go from around $60,000 to $150,000 or so.

I don't know why people expect that home prices will double in 10 years. I owned a home for 20 years. It DID NOT DOUBLE. In fact it only went up 50% over that time. I bought a few years before the great Texas real estate bust.

10 years may not erase this big fiasco. In fact - people might just be breaking even in about 10 years which is about what happened in TX.

Audrey

[dmpi]

Consider that the median household income is only around $48,000 and the average mortage rate is 6.5%. Even after the 10% drop to $217,000 the median house price still seem a bit pricy. I think houses have more downside to go until we get to a point that people can really afford them.

[Mr._johngalt]

Quote:

Originally Posted by dmpi Consider that the median household income is only around $48,000 and the average mortage rate is 6.5%. Even after the 10% drop to $217,000 the median house price still seem a bit pricy. I think houses have more downside to go until we get to a point that people can really afford them.

That may be true, but they will still find a way to buy them and the market
(RE not stock) will help them.

JG

[bosco]

Quote:

Originally Posted by al_bundy the usual excuse is we need to hire qualified people. i remember i did a paper about pension benefits in school a few years back and this was the excuse they used in san diego back in 1996

I think you should put your money where your mouth is. Don't use public roads anymore. Process your own sewage. Teach your own kids (on second thought, never mind that one....). Be responsible for your own house if it catches on fire. Only use private airports. Think of all the money you'd save.

I find it sad how people constantly argue for budget cuts for government workers, then complain at how inefficient the bureaucracy is. Due to government cuts, I'm managing $12 million in public airport construction (you know...pork like an airport fire-fighting station) with no clerk, secretary, office help of any kind, and almost no inspection. But that's ok, because profit-motive oriented contractors are honest, right? Does this seem efficient to you?

Where I live, the pension system has been gutted. And...big surprise!! It's hard to hire anyone anymore. Since government wages are lower than in the private sector, the benefits were the only reason to consider a civil service job. They "privatized" the stock request system. I've been waiting 2 months for printer cartridges now. It took me 3 1/2 months to replace the digital camera when it broke. But that's ok...who needs a camera on a construction project?

Everybody gets frustrated at the trends in our society. It's truly sad, however, when they reflexively jump at the easy targets.

[jazz4cash]

Quote:

Originally Posted by bosco I find it sad how people constantly argue for budget cuts for government workers, then complain at how inefficient the bureaucracy is. Due to government cuts, I'm managing $12 million in public airport construction (you know...pork like an airport fire-fighting station) with no clerk, secretary, office help of any kind, and almost no inspection. But that's ok, because profit-motive oriented contractors are honest, right? Does this seem efficient to you?

I guess we dreamers believe that if government budgets are cut, efficiency should improve, never considering that it is more likely that efficiency remains status quo and services get cut instead. We expect cuts will affect the money thats wasted, not the fire department.

[bosco]

Quote:

Originally Posted by jazz4cash I guess we dreamers believe that if government budgets are cut, efficiency should improve, never considering that it is more likely that efficiency remains status quo and services get cut instead. We expect cuts will affect the money thats wasted, not the fire department.

Sounds good in theory. It must be waste--after all it's the government. Everybody hates the government. Therefore, the government must be inefficient. And since we're all frustrated with the government, let's cut the pension of government employees! Yah--since we don't have a pension (because we chose to work in the private sector for higher pay and less benefits) let's retroactively take away one of the few reasons why anybody would ever choose to work for the government. When I switched from the private sector to the government, it took over 10 years before I made the same salary again doing the same kind of work (designing docks and bridges). I did it for a host of reasons inculding my observation that the public welfare is not necessarily served when profit-motive determines effort and care in a critical design. But I also did it to get more time off and better retirement benefits.

Guess what--the government has good and bad employees, just like the private sector. As a consumer, I haven't noticed that I get any better or more efficient service from the phone, cellphone, or cable company than I do from a government agency. Maybe if we cut phone company employees by 50% and hosed their pensions, our telephone bills would be cheaper? Maybe so, because we couldn't get a line very often and therefore would call less.

The government is an easy target because everybody is an expert. Just like everyone is an expert on traffic engineering and education. But sometimes the cliches don't really pan out in reality. I find frustration toward the government understandable. I find directing the frustration toward the pension benefits of employees incredibly rancorous. I think it's shameful that private companies have been allowed to sleaze out on their pension obligations and foist the liability off on taxpayers. It certainly wouldn't make it less shameful to do the same thing to public employees.

[neo]

Quote:

Originally Posted by bosco I find it sad how people constantly argue for budget cuts for government workers, then complain at how inefficient the bureaucracy is.

Well people may argue for budget cuts, but it never happens, in fact just the opposite. And the bigger the budget, the more inefficient the bureaucracy.

[youbet]

Bosco......

Remember the gummint changes the rules for the private sector ( trade agreements, taxes, pension controls, environmental regulations, etc.) in mid-stream. Many of us have had our careers jostled because of sudden changes in our industries mandated by the gummint.

What goes around comes around. If private citizens now want changes to government organizations, what's the difference? Other than this time it would be the gummint employee getting jostled instead of the private sector employee. Jostled is jostled.

[Zipper]

I thought you were in Canada Bosco?

We do pay higher taxes here. You get what you pay for. Maybe you should be in Ontario.

[macdaddy]

Prices around downtown Boston are already down about 15% from the peak. Bad units/locations have been on the market close to a year without any movement. I think we'll see another 10% decline but then a quick rebound... already some smart investors I know are getting ready to jump back in. Rents have been strengthening for awhile too. The other areas I follow are DC and San Diego. Rents strong in both, prices holding in DC, but clearly starting to slip in San Diego.

[jazz4cash]

Quote:

Originally Posted by macdaddy Rents strong in both, prices holding in DC, but clearly starting to slip in San Diego.

Statistics don't show it, but I seriously doubt prices are holding in DC. Builders reported very high cancellation rates here recently and most have standing inventory for the 1st time in 5 years or so. They are making concessions that are not reflected in the contract price. Existing home sales prices appear down a "bit", but that never factors in how long they sit prior to getting a contract.

[Texas Proud]

Bosco...

You miss the point when I say I want to cut gomt spending... when tax revnue went up way more than inflation, what did they do Did they fix the infrastructure that needed fixing NO, they buit more to break later in life... and they build roads that have pot holes within a year... and build bridges to islands in Alaska when it would be millions cheaper to just buy everyone a boat...

My problem is not with the workers doing the work, just on what they decide to spend it on...

Or, they could have reduced taxes and kept spending in line with inflation... but no.. spend every dollar that comes in and when tax revenues drop during a recession, bitch that we need to raise taxes to pay for all the services they are doing...

I keep saying that the federal govmt need to balance the budget without using the extra SS money.... spend it on whatever you like, but just spend what you make.... will not happen in my lifetime...