patrick.net

ex-sunnyvale-renter Says:
Anyone watch the TV show King Of The HIll? The one where Cotton Hill almost buys a timeshare is a good one.

what about the South Park timeshare episode?

Busted Says:
Standard Pacific homes called me today to say the townhouse my wife and I looked at a month ago in Fremont has been lowered from 625 to 569.

that's good

I told him I just lost my job becasue I worked for a real estate company.

that's bad

A house built in 1991 in Fremont just closed for 670 after originally being listed for 759, the same price that the house next door closed for in May.

that's good

Dude … I have nothing to complain. I chose to rent and good or bad, it’s my decision and my luck and my life. Let me spell out this for you. I was feeling sad for those who work hard and earn high income only to transfer that to some lender.

Okay, I apologize then for coming on so strong. I thought you meant it was a tragedy that they could not live more luxuriously. I guess it might be a sad if they lost it all in the upcoming real estate downturn, but other than that I don't feel particularly sorry for them.

That Mt. View stucco sh*tbox doesn’t really look so overpriced now, does it?

What does that prove ? That there are expensive real estates all around the world ? There always have been and the always will be.

I can tell you several places in India where the RE prices are way more expensive than BA - even after you covert Rs to US$. That is completely unrelated.

Point is, in most of these expensive places the people who live there in general do not desperately need a monthly income to remain in that home. Heck, it's just a part of their net worth.

And that's what is wrong (financially, not morally) about a code monkey living in a 1M home. A job loss and he is at serious risk of losing it all. He doesn't have 1M net worth, he has 1M DEBT. The problem is getting in debt way over his head. The problem is not having any cushion.

And yes, I ALSO was feeling sad about them not able to live luxuriously. Again, I am not saying they should. I am saying they simply CANNOT. They have no choice in that matter even after earning all these big bucks. I am not feeling sad because of the lifestyle choice, I am feeling sad that they do NOT have a choice. I am not feeling sad that they are saving money instead of spending, I am feeling sad because they do NOT have money to save even at that high salary.

Think about it. They are mortgage slaves - with only hope of freedom that can be brought by a greater fool. What is not tragic about it ? It's not that they will go bankrupt if a serious RE downturn hits, although that is not ruled out. But working hard, earning high income should result in financial freedom, not mortgage slavery.

I also don't feel sorry for them. They are taking a risk and the future may prove them smart for taking that risk. I doubt it though. As I have said before, they (typical Cupertino buyers) are spending all that money so that their kids can get good primary education - at the cost of not having enough money for their kids' college education. I find that ironic. And tragic.

StuckInBA,

Long time lurker and liker of your logic. I do think that what you think will bring down home prices down (tighter lending) and what most others think (loss of jobs, stocks going down) happening in conjunction would be the perfect recipe for most of us waiting for sanity to return.

Just curious, what makes you stick to BA? Is it the gorgeous weather which enables us to have days like we had today (oops..thats yesterday already!)? :-)

Jimbo,
You need to stop making assumptions about my or other posters' motivations, desires and living situations. I am perfectly happy where I am right now, in a very financially strong position, and am enjoying watching this housing tragedy unfold. You honestly come off really, really defensive and bitter, more so than the posters here.

And again, you are buying into the myth that the Bay Area is populated by uber-rich who price out all the lowly worker bees. My original point is that personally, I have observed many stark juxtapositions of high income families buying right into neighborhoods with likely a median income nearly an order of magnitude lower, just because they bought their home 5-10 years later than the rest of the neighborhood. These neighborhoods you claim are mostly populated by "financial types" are full of mid-level engineers who happened to have bought 10-20 years ago. Now their neighbors are those financial types who bought in the last 2-5 years. There has clearly been an acceleration of housing price disconnect here, and your retarded attitude of put up or shut up just doesn't cut it. What do you propose? Just to not say anything and deal? C'mon, we all have a right to comment, observe, and post. If you don't like it, then shut up yourself.

Stuck,
You responded to Jimbo's comments much better than me.

I think it cannot be emphasized enough that, yes, the "masses" may be moving to 30y FRMs, they may have high incomes by national or even state standards, but the economy ALWAYS cycles. And as a result, many people who currently feel secure in their income prospects will lose their jobs. It's unavoidable.

There has never been a period in US history, much less CA or Bay Area history, where the economy remained in monotonically positive sustained growth for decades and decades. The typical business cycle is 4-8 years. We have had about 6 years of sustained growth since the last (mild) recession in 2001. Why are things different now that we will somehow avoid the contractionary phase of this business cycle? It's likely in fact that December may be seen in retrospect as the start of this recessionary cycle.

It's just my impression that many people across all income brackets bought homes with assumptions that they will have secure incomes for years to come. This will most likely be untrue.

Peter P:

More to the point, here's what $275K gets you in Boise. This is the same floorplan as my house although in a less-desirable location in my subdivision.
http://www.cbaspen.com/default.cfm/Page=/ForSale/Cat=/ShowPropertyInfo/PropertyType=/Residential/ML_Number=/98330478.htm

The real tragedy of BA RE prices is that they tear families apart. The parents who bought in the 1950s and 1960s will grow old separated from their children and grandchildren who were forced to re-locate out of state for financial reasons.

Dennis, I want to visit Idaho and Montana someday. I love natural beauty.

Different Sean - haven't seen the South Park timeshare episode, I'm sure it was good!

StuckInBA - good points as always on mortgage slavery. The thing with the BA is, to afford to live there you have to work such long hours that you never get to go anywhere or do anything. It's just work work work all the time. The only people enjoying the place before the age of 70 (assuming a workaholic lifestyle will allow you to live that long) are the social dropouts, the hippies living in vans and itinerent street musicians and guys who carve wooden spoons that look like hands etc. The weather's not TOO cold, the punters at the farmer's markets and gathering places are generous, and if you get a "mommy" van you can live out of low-profile, you've got it made.

With the long hours everyone works, they might as well be in Dallas TX or Davenport IA.

>> StuckInBA - good points as always on mortgage slavery.

All,

Do you understand that mortgage is a form of taxation which is privatized. Basically the name of the game is to provide government tax breaks so that more and more people pay this kind of privatized tax to banks ....

Peter P:
Bring your fillet knife and have the world's freshest sashimi by the river. Just whack the steelhead or salmon's head on a rock and dig in. Pack some wasabi and cold rice and you are all set. Sorry but sturgeon is a protected species here so no fancy caviar. See http://fishandgame.idaho.gov/ for details. Although a contrary opinion is here http://www.rain.org/~hutch/sashimi.html .

My point was that your $1M house is way too fancy for most families, whereas the $275K house I linked is more than adequate and quite comfortable inside. Plus I can walk to golf and horseback riding.

Oh my goodness....I finally posted something that went into moderation.

>> Think about it. They are mortgage slaves - with only hope of freedom that can be brought by a greater fool. What is not tragic about it ?

I would like to know how may bay area families know about this TRUTH? How many families know that they are paying high TAXES to banks...

Permarenter,

How about these two:

1. The 6% private sales tax on real-estate transactions.

2. The 3-5% private sales tax on credit card transactions.

Justme

DennisN - that's an interesting and valid way of looking at it. Imagine our country as being run by and for the banks, which is not hard since it's true.

Then imagine every way to get a person into lifetime slavery for the banks being pushed as a Good Thing.

40+ years ago people paid mortgages OFF and had a party where they burned the note.

According to the Center for Immigration Studies, 22 of the 94 foreign-born nationals convicted or indicted on terror charges from 1993 to 2004 were in the U.S. on student visas. Many were visiting here from Saudi Arabia, one of 34 predominantly Muslim states Homeland Security lists as "countries of interest for terrorism."

Yet in a little-noticed 2005 deal struck between President Bush and Saudi King Abdullah, 21,000 young Saudi men will gain U.S. student visas by 2009. The program is supposed to heal the wound left by the 15 Saudi hijackers by promoting cultural exchange and understanding. Abdullah promises the new wave of Saudi students will be on their best behavior and allay our suspicions.

Brothers keeping phones to selves during tiger case
Police want to examine text messages, photos from day of fatal mauling
By Linda Goldston
MEDIANEWS STAFF

Article Launched: 01/05/2008 03:02:08 AM PST

Two San Jose brothers mauled by a tiger at the San Francisco Zoo on Christmas Day have refused to allow police to examine their cell phones for possible text messages or photos believed to be taken the day of a tiger's escape.
In a letter sent Friday to the brothers' attorney, celebrity lawyer Mark Geragos, San Francisco City Attorney Dennis Herrera asked that Paul and Kulbir Dhaliwal preserve "this potentially critical evidence."

"The digital content of your clients' cell phones, which we understand are currently in the possession of the police, may help reconstruct what happened at the tiger exhibit and cafe," Herrera wrote.

Geragos did not return a phone call from MediaNews.

He said earlier this week that news reports of his clients taunting Tatiana, a Siberian tiger, before she escaped from her grotto were not true. A friend of the Dhaliwals', Carlos Sousa Jr., 17, of San Jose, was fatally mauled when the tiger escaped.

Sousa had tried to distract the tiger when she attacked one of the brothers. After Sousa was fatally mauled, the brothers ran to the zoo cafe, near where police shot and killed the tiger.

===========

Conclusion:

Mix of Indian Punjabi and Mexican youth is a deadly cocktail of STUPIDITY

The word for today is 'juxtapositions', skillfully used by Skibum.

Mix of Indian Punjabi and Mexican youth is a deadly cocktail of STUPIDITY

Even if you are not serious, it is not that funny as a joke. Besides, there's no indication that Sousa did anything wrong.

There are many witnesses saying the wogs were taunting the tiger and the tiger attacked only them.

maybe Indian food is too spicy for tigers, either that or they just simply prefer chimichangas. I think real tragedy here is the shooting of the tiger. Wow, you're fucking kidding me, if you taunt a tiger it will track you down and kill you? Who fucking knew. As far as I am concerned the SF bay area needs more tiger maulings, not less.

Sure, I'm sure no one ever taunts any animals in zoos before. The one time I was in the SF Zoo, it looked like a pretty sad place and seemed poorly run.

As for the taunting argument, a few years ago a disabled child fell out of a roller coaster and died in Great America and they found no fault on behalf of the amusement park. The bottom line is, tigers should not be able to leap out of the pen, same goes of amusement parks letting riders fall off.

What if the retarded child fell out of the roller coaster into the tiger pen?

The one time I was in the SF Zoo, it looked like a pretty sad place and seemed poorly run.

maybe it's a scam to tear it down and build loft condos?

There is only one way to make money very fast, very easily, through monopoly. Microsoft proved this point, but at least Microsoft represented an emerging industry that changed the world. Many people don't realize that Wall Street is a part of a MONOPOLY. The right to print money, control flow and velocity of money is the ultimate monopoly power in human society. However, you cannot just apply the lever without an excuse, so you need packaging - telling a convincing story. The story of the century is, housing value will always go up, and it is the safest investment.

The flippers, mortgage bankers, builders are actually all small fish who take up more risk for less reward. They actually have to DO something. The highest rank in the food chain are the MBS packager who sliced and diced the product, and take hundreds of millions of commission in selling it, RISK FREE. Yeah, things blow up in the end but they have already sheltered their stolen wealth in some offshore accounts.

So if you look at the big picture, nobody in the entire housing value chain has any near-monopolistic power except for the one at the top controlling the economic lever i.e. interest rate along with the Fed. That also explains why Wall Street have been able to make record bonus in the last few years while the economy was barely hobbling along, if you strip away all the stupid hooplas and adjust growth for real inflation.

I recall reading a story years ago about a cannibal chief in Africa talking about human cuisine. IIRC he said that the thighs were the best part and that white people were too salty.

Suffer-ecchs - Yep feed 'em all to the tigers as far as I'm concerned, it's good for the environment!

DennisN - and now they're getting a chance again to get 'em eating each other again...... maybe if you shoot one African the others just crowd in and eat 'im lol.

My brother taunted a caged ape when we were kids. I have never seen an animal so pissed, and you could tell it was personal. If that thing had gotten out it would have gone straight for him. Animals have pride. I inadvertantly pissed a normally very friendly cockatoo off because it bobbed its head at me, and I bobbed mine back. A year later that bird recognized me and hated me. Animals are smarter than we think. Tigers used to conduct almost organized raids on Indian villages. Some estimates were that hundreds of thousands of Indians died during the 1800s. They now fear people and seem to pass the knowledge onto their cubs.

In any case the SF incident is a strict liability negligence case because, although distasteful, people taunting an animal doesn't relieve an animal owner of their legal responsibility for damages caused by the animal. Someone can go to the zoo and have a reasonable expectation that a tiger can't jump out of the exhibit.

Yes it sucks that the tiger was taunted. It seems every day they're discovering animals are smarter and more self-aware than supposed.

I was at the San Diego zoo watching the bonobos, and apparently the bonobo "word" for "fuck you" is to shake the hand in a certain way, like you're shaking shit off of it. Well, a little (human) kid saw this gesture used and used it to one of the elder female bonobos of the bunch, and the elder female rapped the Plexiglas the kid was near, hard. Lesson learned. You don't go flipping the finger at people - or bonobos - for the hell of it. It was pretty funny and I'm not sure how many other humans saw what was going on.

I've also met an orange cat that hated me on sight. It didn't make sense, that cat didn't even know me! And cats generally like me. But apparently I reminded that cat of someone who was a real bastard to it. I tried to make friends, but I could tell it would be a long hard road, and probably never really happen. This when I had the other cats in the place checking in with me for their daily pet.

Yes, though, the situation at the zoo is a case of negligence, hell it seems half the zoo owners in this country have had no idea how tall their fences are.

Malcolm - and now that the tigers have been hunted almost all away, here we are, knee deep in Indians! I tell you, there needs to be a tiger repopulation program to restore Nature's balance and trim down the Indian population.

No comment but believe me I am laughing.

Well despite all this hyperbole of how smart animals are, the hairless ape takes the cake, after all, who would have dreamed of 0 down only goes up, carve it up and defraud foreign governments, the apes? no. the great white ape. Remember the boomer mantra folks, less for you equals more for me and of course my fat assed fake titty second/third wife. Fuck you; my toilets cost more than you. I'm thinking of opening up a web 2.0 site, waddling boomer.com

BARenter :
Just curious, what makes you stick to BA?

It's a case of "a known devil is better than an unknown angel" ! To be honest, this is an immigrant friendly area. Every area will have its pluses and minuses which are very subjective. I happen to find more things to like here than dislike.

There are enough chances to find a job that is satisfying - and I was very fortunate to work on some really cool stuff. Things that one dreams while studying Computer Science. You get paid decently at the same time. The salaries are not bad at all if you are willing to rent ;-)

Been here more than 9 years now. Developed a social circle, so that helps. Enough opportunities for day trips around the area. Nice variety of cuisines. Weather is fabulous.

There are things that I am not particularly fond of. But there is no perfect area. So I am OK with those - like the high population density. I am pretty conservative minded so I stay away from Berkley/San Francisco and pretend that they do not exist. ;-)

ex-sunnyvale-renter :
40+ years ago people paid mortgages OFF and had a party where they burned the note.

I wasn't aware of this fact till I started reading bubble blogs. My first reaction was that this must be some joke. But then I googled and wow ! There was a time when people tried to get OUT of debt !! In America ? And even today a minority exists that subscribe to similar philosophy ?

I felt like I found my support group.

# PermaRenter Says:
Do you understand that mortgage is a form of taxation which is privatized. Basically the name of the game is to provide government tax breaks so that more and more people pay this kind of privatized tax to banks ….

That's an interesting way to put it. The net result of MID is exactly opposite of affordable housing and ends up making the bankers rich.

But there is a way of playing the game that increases your odds. Use the debt when you don't really need it. As Randy H has explained nicely, there is an implicit call option. Even if you have enough money to buy using outright cash, you can still take the loan, claim tax deduction. If your return on your investments made using the cash is not turning out to be enough, simply prepay the loan.

This kind of works even when you cannot buy using outright cash. When interest rates are this low, use as little down payment as the lender allows, see if interest arbitrage works for you. Of course, there is a risk involved - that your investments may not return more than the interest.

* NOT ADVICE OF ANY SORT

Bap33,
"Wog" is an old and very generic British Empire slur for non-Brit subjects of said empire. The old saying among upper-crust Brits was that "the wogs begin at Calais".

Stuck,
You've heard about the "biological clock"? Years ago people had a "retirement clock" in which they raced to pay off the mortgage so that they could retire. You don't need that much income in retirement if your kids are through college and your mortgage is paid off.

My San Jose house was bought in 1981 and the mortgage was re-fi'ed several times for various reasons. But I still paid it off in only 22 years in 2003.

My family started moving into northern California at least by 1862 - that's the earliest date of which I have paper documentation, although several ancestors may have arrived earlier. Life in the BA has gotten progressively worse over the last 150 years. Early on my ancestors really didn't have to work that hard to live a good life, but the last 3 generations have lived progressively poorer yet had to work harder and longer hours.

>> That’s an interesting way to put it. The net result of MID is exactly opposite of affordable housing and ends up making the bankers rich.

Architecht of this SCAM is Bill Clinton. I am very happy that Democrats are not in power for last year. God knows what they would have done with housing bubble.

====

The Clinton Housing Bubble
By Vernon L. Smith
Word Count: 753
The joint housing and mortgage-market crisis once again reminds us that all financial implosions stem from the same cause: borrowing short and lending long without enough equity to weather periodic storms in the gap between.

But this bubble was different. Besides being fueled by housing purchases and repackaged loans, each with inadequate equity -- doubling down with other people's money -- at the end of the capital-gains rainbow was the right to take up to $500,000 of profit, tax free.

Thank you President Bill Clinton for your 1997 action, applauded by the banks, the realtors and all citizens in search ...

I am very happy that Democrats are not in power for last EIGHT years