patrick.net

Fewlesh,

For the most part I'm a self taught guy myself and I've done better than some but would have never be considered for national sales manager let alone CEO. Do I care? Sometimes, it might have been nice, guess being independent I'll never know.

What Randy H may have been driving at is that for every Soros there is a Richard Strong. Founder of the former Strong Funds. After years of being above board and running a clean shop he developed this incredible sense of entitlement. He began treating clients money like it was his money. He could have sold the firm in 2002 for 2bil! Enter an NASD investigation and the co. is now worth 400mil. Btw Strong has been barred from the industry for life. So it's not as much about education vs. street smarts it's about that sense of "entitlement".

Randy H,

IANAL? Oh, I gotcha.

Peter P,

IV? Inverse Volume?

“Condos for Rich Idiots”

Or in this case "Condos for Debt Slave Idiots"

DinOR,

Thanks for helping to clarify my thoughts. I'm in no way intending to discourage self-teaching. Most successful people are self-taught in at least a couple of fields. I'm self-taught in things like software methodologies and designs.

What I am concerned about is accountability. Where degrees, certifications and licenses help is in that arena. Were Strong a realtor instead of a NASD fund manager, he'd have come away a lot less damaged and probably not censured, even though the damages caused in RE are probably much worse to the individual than those in mutual funds.

I had all of my SEP monies in Strong (15 years worth), and still remember the day I called up Vanguard after reading the FT one morning. However, the damages I suffered were relatively minimized by the fact that the funds I held were still regulated, audited, and transparent *by and large*. So, diversification worked, and I didn't lose my ass, as could well happen to many recent homebuyers with exotic loans.

Randy H,

Oh yeah, that would make sense for them to have gotten your firm's business being right there in Menominee Falls, WI! They had a great "footprint" in the mid-west. But Dick Strong made some other mistakes like when on "analysts day" he told a group of India born and Asian analysts that these "Polish and Swedish kids know how to get the job done!" Good going Dick! Agreed though, the NASD had him roped, hog-tied and branded before he could do any real damage to clients.

IV? Inverse Volume?

Implied Volatility. I think GOOG is at around 60% IV, not very high, although not low by any measure. Back in 2001, many stock options have IV north of 150%. You could sell an option, be dead wrong, and still laugh all the way to the bank.

If somebody in London can see this, why do we still have people here (albeit fewer of them each month) who are willing to go deeply into debt to purchase houses here?

There are always compulsive shoppers who cannot see the writings on the wall, I guess. They are going to make the fall more entertaining.

SFWoman,

I think it would be very difficult to get any kind of meaningful class actions to stick to Realtors(tm) (again, not being a lawyer). Perhaps suits against some of the larger firms where they can clearly be proven to have systematically pushed such tactics might have better chances. Rather, I think the class suits will come against lots of the lenders. Things like "no-doc" mortgages probably will come under a lot of scrutiny.

Peter P,

O.K! The "vols". I never really got on board with that end of the market so I had to make a quick call! I guess I never understood how "vols" are different from say "beta"? Would it be the same as saying "XYZ" has a beta of .6 vice 1.5?

I think it would be very difficult to get any kind of meaningful class actions to stick to Realtors(tm) (again, not being a lawyer). Perhaps suits against some of the larger firms where they can clearly be proven to have systematically pushed such tactics might have better chances. Rather, I think the class suits will come against lots of the lenders. Things like “no-doc” mortgages probably will come under a lot of scrutiny.

A lawyer friend of mine said that actions against RE professionals can become lucrative. They have been asking for trouble all along anyway. No one would touch them when the trend is their friend. When the trend ends, all hell will break lose. I think legal actions were brought against the Hunt brothers only after they have gone broke, right?

O.K! The “vols”. I never really got on board with that end of the market so I had to make a quick call! I guess I never understood how “vols” are different from say “beta”? Would it be the same as saying “XYZ” has a beta of .6 vice 1.5?

I guess it is similar. Volatility is a variable used to calculate the "fair" option price, given the stock price and other parameters. When both the option price and the stock price are known, we can solve for the "implied" volatility, which is a measure of how "expensive" an option is.

Look! They have a code of ethics. I wonder what it says.

Perhaps somewhere it says a member can only drive a BMW 7, a Mercedes S/CL/SL, or a Lexus LS even if it is leased.

To appear affluent and successful you need a new one bi-annually, and with leasing you have a low monthly payment.

You are right! :)

For those not aware, CA has laws prohibiting slapps (strategic lawsuits against public participation).

Realt-whores opposing Open MLS and public access to market data should be SLAPPed.

Peter P,

Oh, O.K! I see the difference in that the beta is measured against an index, the S+P 500 or the NASDAQ 100 or the Footsie or whatever. Whereas the "vols" are measured against the issue itself! Is that accurate?

I also agree that these realtors are not "impervious". They can be "got" to! There are definitely cases where I think that could and SHOULD be done but I'm not sure I'm up for a witch hunt. What I'd rather see is simply an alternative listing service or other service model be given a fighting chance. Allow the market to decide, and if a few land in jail along the way?

Well, since I mentored them personally and respect them as engineers, I can’t quite bring myself to look forward to the train wreck in their case.

Just to be evil for a while... when their mortgages goe upside-down, you can exert more pressure on them because the job security suddenly becomes a lot more important. :twisted:

I have been a proponent of a flat (or flatter) tax system for many years. I do think that there needs to be a taxable income threshold, though. 20% of 10K versus 20% of 10MM isn't fair, given the differeing degree of consumption that occurs at those income levels.

The system that proposed an absolute flat tax starting at 50K of family income seemed reasonably fair. It would produce many times the tax revenue that the current "progressive" system provides.

The very rich and very poor are the ones who oppose flat-tax systems. The threshold removes the objections of the very poor. The rich will always oppose these systems because they stand to gain the most from tax shelters, loopholes and have the means to exploit them.

By the way, for a flat-tax system to work you'd need to remove many consumption/sales taxes and all state income taxes (otherwise you're just shifting money from fed to the states, and the populus high tax states would win, taking money away from rural states...which is now being redistributed to them from rich states). This would violate the Constitution insofar as states rights issues. So, you'd need to federalize way beyond the current form; and people already get worked up about big government.

Peter P,

Don't be evil. Not even for a while.

SFWoman,

I like consumption tax alternatives the best, theoretically. They are the fairest by far. But the practical truth is that they are extremely difficult to implement, create an even larger beuacracy, and are notoriously hard to police. These systems are very easily cheated and gamed, much more than income taxes.

Don’t be evil. Not even for a while.

You are very right. Google became evil for just a moment and look what happened to them. :)

"So they’re going to try to turn Vallco into another upper middle-class mall like ValleyFair? That is really a missed opportunity."

I agree. Also, Valley Fair is practically down the street. I just don't get it.

But at least we will have an "upscale bowling venue." God knows you can't have enough of those, whatever they are.

Randy H,

We looked long and hard at the "Total Tax" here in OR and it could work for us at the state level. Why? B/c the people that are participants in the underground/black market economy haven't paid in years! Maybe generations. So, if you're in the following areas of commerce (where your lack of trustworthiness has long been established) you, you stay on the "old" system. You're stuck in 1040 land and everyone else just pays 1% of gross revs! They are as follows:

Collectible ANYTHING dealers
Automotive "recyclers"
Tow truck operators
Laundramat Operators (on the fence with these guys) pay 1% of utilities?
Auction Houses and anbody else on the "honor" system

You will be flagged just b/c you are not on the 1% system!

(It's bad here guys)

it is a combination of various already-solved problems: a basic searchable catalog, a simple workflow engine, and an online auction/reverse-auction tool, fronted by a bunch of php-pages. Piece of cake.

We almost have it. Just have all RE traffic goes through eBay. Reverse auction? How about Priceline Real Estate Name You Own Price? :)

How about Priceline Real Estate Name You Own Price?

The address will be revealed to you once your price is accepted by a seller.

Priceline RE? Brilliant!

Single Payer health care
and a flat tax with no loopholes,cuts, breaks or shelters foregeign or domestic. That’s what we need.

Without "loopholes" it would be difficult to incentivize certain activities though.

where’s the “no incentive” you mention Peter?

Like tax credits for solar panels and other strategic technologies or investments.

You know, the tax system is a power instrument to alter behaviors and patterns.

Example,

The $6,000 you tax from the $30,000 family constitutes about 90% (actually a little less, but rounding) staple consumption, or $5,400.

The $20,000 you tax from the $100,000 family constitutes about 10% staple consumption, or $2,000.

This is the definition of regressive incentives.

The market does not solve all problems. I am about as close to a market fundamentalist as exists, but the market has a bad tendency to get caught in “local maxima” and not optimize for the greater good.

Randy, I agree with you absolutely.

Hate to butt in, but did anyone read the article in the San Fran Chronicle yesterday called " 2 in 5 bay area residents considering moving."? The main reason was cost of housing. hmmmm. Sounds like this is the clearest evidence via local opinion that either prices will have to come down, or the area's economy is going to go down the toilet.hard to tell right now, with all those people who bought and want to hold on for a few years.Either way, either outcome will be equally dramatic. Let the fireworks begin.

Sounds like this is the clearest evidence via local opinion that either prices will have to come down, or the area’s economy is going to go down the toilet.

Or both.

Eventually, it will find a new balance.

Hey Davis Renter,
Well if I had a new business, I certainly wouldn't want to hire people from the Bay Area. The salaries and environmental laws would kill me. There are plenty of intelligent skilled people out there who can do the work for less. I think we aught to start a new term in the forum called: "NeoAmerika" which is the comparitve similiarity between America, as the new world seen by foreign immigrants in key places like NY and LA and the "NeoAmerika", the New America where older established CA and NY residents move to the new frontiers of places formerly ignored like NC, TN, GA, and TX. This is where the future for the American middle class is, and subsequntly, all the new ideas that will be formed by burgeoning young minds priced out of the former intellectual strongholds. Far fetched? Maybe. We'll see.

If we are an ownership society why don’t we give people who currently don’t have the advantage of the mortgage deduction the ability to take advantage of using the same benefit towards saving to buy a home?

Good idea! There will even be support from the RE industry.

But the money needs to come from somewhere though.

OK, 370some comments, time for a new thread. Suggestions?

This is where the future for the American middle class is, and subsequntly, all the new ideas that will be formed by burgeoning young minds priced out of the former intellectual strongholds. Far fetched? Maybe. We’ll see.

Far-fetched? Not at all. Personally, I've seen areas with less overhead costs attract more innovation because it's far easier to get started and support creative risk. Of course, it usually requires a good knowledge/experience base. All things being equal: I were a startup, would I want to locate on Sand Hill rd (Menlo Park), or somewhere like Des Moines, IA? ;)

Granted, there's a lot of variables at play, but I'd prefer a business model first based on lower costs, than hoping to be spoon-fed investment capital to keep employees here until clients become established. Eventually, I would try to move the company--for their benefit and mine, lest I suffer the fate of those dot-bomb sock puppet companies: overfed and underproductive.

Increase taxes on the rich…they can afford it!

How about if we re-introduce the Harley tax with a twist and instead of taxing Japanese motorcycles 750cc and bigger, it can be called the GM tax and add tax to all Japanese and German luxury cars.

Huh? I am not rich but I never believe in "increasing taxes on the rich". It is counterproductive as it disincentivizes economic activities.

Protectionism only begets protectionism. The consumers will stand to lose.

Or we increase the capital gains rate on the amount from home sales. I believe increasing to $500,000 the capital gains exemption for home sales by the Clinton administration was the one of the matches which lit the housing fire.

How about abolishing capital gain taxes altogether? It really discourages investments. On the other hand, the best way to rectify Prop 13 effects is to abolish property tax altogether. Or at least, property taxes should be based on rental equivalent.

New thread Tax Reform?

I don’t believe in taxing the rich either….for some reason our household income puts us in the range of the what the feds say is rich but we’re still to poor to buy a crap house here in the Bay Area. Go figure…

Yes, even 160K income and 150K in saving is too poor to buy a house. Ha ha. :)

Holy crap! A real live realt-whore!

A realt-whore that is a real whore?