By someone else
follow someone else
2006 Apr 30, 10:06am
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This tiny old box is for sale to any fool willing to throw away $1,595,000. While it is close to a nice park, what you will not learn from the sales material is that there is a half-way house for alcoholic vietnam vets nearby as well, nor that the street, which is quiet on Sundays, is a major thoroughfare during rush hours. In fact, the traffic situation is so bad that there was a city attempt to block much of the traffic through strategically placed barriers recently, but the outcry was so great that the barriers were removed, leaving only a simmering acrimony between neighbors for and those against the barriers.
There is no backyard at all, only a wooden deck. The house is overshadowed by the much larger house to the right. The steps are cracked brick, and the handrails are just painted pieces of pipe. There is peeling paint and perhaps some rot around the foundations.
The house has several cramped and unusal spaces which are called bedrooms for sales purposes. What used to be called the garage is a studio unit perhaps rentable to Stanford students, though that rent will make no significant difference to a mortgage this large.
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thanks for your reply. I have no interest in Falun Gong, however, since I can't speak or read Chinese, I have no way of knowing if "interviews" are literal or creative translations or mere fabrications.
I find the dogged anti CCP tone of the Epoch Times kind of enjoyable, and have to say my bigest question has always been, how much of what is said by any Chinese news organization or official is legit and how much is BS, on any side of any issue, whether Xinhua or Epoch Times, same/same.
Culturally, how much has the old Sun Tzu/Machiavelli deviousness of these corrupt mandarins shone through is I guess the question?
I'm not really interested in economic analysis as much as "political" analysis. This is because of my impression that economically, China is as much of a paper tiger as can be, given the fact individuals there are still getting incredibly wealthy.
So whatever is going to happen, certainly I wonder how much can be known by people like us, and how much is disinformation?
I guess I believe something can be known, or Jerry Yang wouldn't be capitualting and helping his compatriots maintain control.
Just a little rant... ;)
I second Owneroccupier's opinion about FLG. It was a stupid money making gimmick (think Scientology) that attracted a little too much heat from the Chinese Central government.
It's very difficult to get a coherent picture of what is happening in China. Xinhua and Renmin Daily can be useful for gauging the Central Government's intentions. Western reports are occasionally useful, but they tend to have a poor understanding about how China works. There are some interesting reporting done on the local level, but nothing that can give an overall picture of what's happening in China. You really have to be there and see with your own eyes, and rely on people who live and breath this stuff daily. A lot of critical information is passed informally as gossip.
There is a way to get facts on the ground, if you're very friendly with a very highly placed Chinese official...however, that is speaking purely in hypotheticals.
Thanks for your reply Astrid,
okay, I'll phrase it again, my real question is about "Chinese" reporting, how much of what is reported is literal?
For example, if a British paper reported events in France, and comments by a French general, probably they would be translated pretty well, 'cause lots of people in Britain speak French (not just french people now living in Britain).
With reporting on stuff in China, if I see so and so said such and such, how likely is it to be a literal translation and how likely is it to be hyperbole or BS?
Can anyone suggest a publication in which the translated comments or speeches could be reasonably expected to be accurate, from a political or current events point of view?
The reason I ask is, I think listening to what people are saying is a good place to start gauging what is happening, and I believe what is happening in China is important for the world to pay attention to right now.
Well, the Chinese government could just censor whatever it doesn't like. I can't comment directly, but I assume that the major Hong Kong and Taiwan newspapers do a decent job of reporting China's happenings; there will be censorship and biases, but that's even the case in America, albeit to a lesser extreme.
I would just get my China news from the Economist, their reporting was pretty good back when I was still reading it.
Just don't get your info from the Epoch Times. It's absolute shite.
Ha! Brillant pin down of nomad. The regulars have all developed quite the online personality for themselves.
I guess I'll have to read the Flashman books now. ;)
for economic facts about China, read Andy Xie from Morgan Stanley, you won't find a better source than him. He can peel through the bullsh*t and go straight to the facts. Someone may find him touchy feely at times, but that is the way things are in China. However, he is always early in making his calls.
For political stuff, read Far East Economic Review, which I believe you can get through your DJ subscription along with WSJ, Barrons etc.
But the real good stuff that gives you a good glimpse of state of affairs in China unfortunately is all in Chinese which is not translated. HK and Taiwan tend to have better perspective because mainland Chinese, even without the presence of censorship, tend to be over-optimistic about their situation, due to an inferiority-induced-superiority complex.
There used to be a Shanghai-born reporter at NYT who wrote many pieces about China, I forgot her name, but I think she is doing law school right now. I like her piece because she is very objective, yet compassionate without losing sight of the big picture.
Far Eastern Economic Review
despite its name, it's actually more politically focused.
thanks for the tips.
Was looking at Epoch 'cause they actually print it and I saw a copy by chance in the one square block chinatown in Victoria where I buy my daily coffe.
So I went to the web-site, noted it has a political agenda but also printed numerous purported quotes from numerous CCP functionaries which were a bit scary, to say the least
I don't doubt there is tons of great objective writing about China in Hong Kong and Taiwan, but what I need is something in English.
My department store Japanese is as far as I am ever likely to get in asian languages, so an english language source for Chinese news is a necessity for me.
I will check out the Far Eastern Economic Review as suggested.
The Housing Crash appears to be in full swing this morning with foreclosures picking up briskly (nice, nice) along with property tax delinquencies. The effect of the ARM reset is as punishing and brutal as promised and then some. Just visited C/L for the Portland area and the "lease w/option" offerings are in full spring time bloom. They are now scrambling for attention by offering "flat appreciation" models at today's prices going out 24 to 36 months. That's just how much they care about you!
The "lofts" in Portland now offer 1 year free HOA fees with a pay option ARM that's cheaper than rent! (As if 15 years of tax moratoriums aren't enough).
Let's all have a crashriffic day!
Just doing my part to spread the good word about Crash City! I realize that I can be a little snide but so many of the articles I've read over the last few weeks seem to have this "anatomy of a crash" tone about them it just seemed appropriate. Gone are the days of spirited debate regarding the validty of a bubble, we've moved suprisingly swiftly to "what will the crash mean to you" phase. Notice though that mainstream articles always distance the sinner from the sin. "Some people that got IO mortgages". "Some people that overpaid" etc. etc.
That should read, "You people that got pay option ARMs". "You people that "won" the bidding war". I suppose though that the authors prefer to leave well enough alone b/c "those" people know who "they" are.
My cleanoffer account is generating between 5-12 new listings per week for my narrow search set (Mill Valley/Corte Madera/Larkspur). This time last year the new inventory rate was perhaps 1-3 new listings per week.
Prices are coming down slightly for the upper part of the range, but there are a surprising number of lease-options now that I look at it. And a lot of price-reduced (but I take this with a grain of salt, they're "reduced" from what they thought they should have appreciated to, which is still too high).
Excuse my ignorance, but is it possible for a buyer to refinance every couple of years to get a â€œteaser rateâ€? Never paying the note off.
Eventually the buyer would be in excess of loan-to-value unless the home appreciates faster than the transaction costs associated with the refis. These costs would include penalties associated with early repayment (which happens in refis) that usually accompany teaser-rate deals. The lenders aren't quite all that stupid.
That's my quandry. Prices have gotten so out of whack just saying "reduced" isn't necessarily descriptive. Reduced? Reduced from what? Reduced from "make mine a dream retirement" to "I'm o.k with playing at a public course retirement"? Who was it that said, "Making someone elses retirement, one mortgage payment at a time". Classic!
The hard reality that Randy H describes doesn't mean there aren't those that haven't tried! They're called "serial re-financers" and we can joke about it but it's one (of many) reasons I dumped my mortgage backed securities.
I've seen desperate pleas on Criagslist where a homedebtor will advertise their situation by saying "I need to re-fi and skip two mortgage payments" with regularity so at least they think of it as some sort of temporary fix.
While not nearly as dramatic we've seen similar builder/investor discrepancies here as well. I noticed over the weekend a DR Horton ad that showed some new floorplans at BELOW $100/sq. ft! For those specuvestors who's cost basis is significantly higher there really can be no exit strategy.
Is it possible that our "recipe" for the crash was flawed from inception? Nearly everyone all along has said *interest rates*. Rates this, rates that banging on the drum until our ears were ringing. Since we were given very region or even neighborhood specific excuses as to why each area was "special" could it not be that each crash is "tailored" or personalized for each area?
"if this were just a normal market with excess inventory"
You seem to imply that it's anything but "normal". So in your mind interest rates aren't near the factor that they've been played up to be? I agree! Besides how many people really qualified for the mid 4's anyway? Or timed it that well? Just the "bait" was enough to draw borrowers out of the woodwork just to see if they had a shot at those rates! We all have friends that are at whatever the rock bottom 30 yr. fixed is at that day anyway. I'd love to see data that shows what percentage of U.S mortgages are at 4%! FIXED that is.
I believe our region specific "recipe for disaster" is as follows:
1. Undeniable dependence on CA markets state of health.
2. Major employers leaving and not being replaced.
3. Erosion of employee benefits ultimately impacting "affordability"
5. Buyer/Consumer faitgue
6. Interest rates
My point exactly! Where are the "bragging rights" of having a 3.875% 30 year fixed if you overpaid for your home by 30-50%? As Patrick is fond of saying, "You can always renegotiate your loan package, you can't renogotiate the price". So for many, it's just too late. In Boston, DC and FL "just listing the damn thing" isn't looking like a very viable option either.
One of the issues you address in your comments is that the builders seem to be just fine putting the same floorplan for on the market for $121,215 cheaper than some investor. Undoubtedly investor greed is a large part of that formula but it does shoot holes in the "it's the materials" and "it's the land" song and dance we've been fed the last 5 years doesn't it?
Before we sold to become bubblesitters in spring 2004, we had a 30-year fixed at 4.25%, with about 60% equity in the home. We could have stayed there forever with that payment had we not needed to move for other reasons. We refi'd quite a lot, but we always did so with zero or trivial fees and only when we could put even more equity in during the refi. (We were always careful to only take classic, standard, no-penalty fixed-rate loans) I wasn't bubble-aware really at that point so I didn't realize that most people were doing the opposite -- taking equity out. When we sold the buyer overpaid and his mortgage was about double what we were paying, yet I doubt his income was much different.
HARM has been focusing on the "it's a land bubble" for some time. I agree! In the end I guess a 2 x 4 costs what a 2 x 4 costs so I have no real issue with the legitimate explanation of concrete facts as they apply to building expenses. I don't grudge a builder a reasonable profit for a lot of hard work. From what you've described though regarding the "tippity top" of the market I refuse to be held accountable as a buyer b/c the builder has grossly overpaid for his lots! Some of the lots in one of our "up scale" subdivisions can go from 90K to 200K. That's a land bubble.
Well that's your basic conservative mid-western upbringing showing again! Imagine that, putting equity INTO a home. What a novel concept. I will say (we sold DEC 2003) that we were very bubble aware. Perhaps regular and enviable appreciation are the norm in the BA, certainly not for Oregon! For our home to have doubled in value during our 10 years there (much of it since 1998/99) was a total aberration. With mill closings and a growing environmental movement home values had actually been on a steady decline since the mid/late 1980's.
Yes, I believe that the bigger builders buy on a national contract and that prices are well negotiated in advance. I've had a number of clients and friends that were lumber brokers over the years. However; smaller players probably wouldn't have access to this end of the distribution chain.
New Thread: Shillerâ€™s Prediction (1 year on)
Can you copy & paste your last comment to the next thread. It is directly on-topic for that discussion.
Thanks George, and your very sapient comment is well placed at the beginning of the thread where everyone will read it.
John Haverty Says:
Haiku on the Asian Self Hater:
Racist self loathing
Oriental Cheetah man
A stealth troll is he
Ha, haaaaaaaaaaaaa! That's friggen' outrageous!
I checked zillow and the current tax on this house is under 2K a year, that means it was bought for 10-15% of its current price. There's plenty of concessions to wring out of the greedy selller yet.
Thanks for your Andy Xie rec, he has some very interesting things to say.
you're talking out of your ass, which is kind of hilarious
What? You don't want to live in EPA? That is the only place that fits your requirements.
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