patrick.net

Dinor,
Until I personally see houses dropping their prices like rocks to at least 30% below what they sold for, then I'm not seeing the crash I was totally assured was happening in February.The bimmers and Mercedes are driving around all weekend, people are looking again, and stuff is actually selling. Trust me- I wanted a HARD CRASH more than anybody here.Seeing the hoopla happening all over again last weekend was the last straw. I swear I almost wanted to kick a few of those for sale signs down, but what good would that do?
That said, I am not in the same position as most people on this forum. I'm 28, just married, and make 50k a year. She makes less. One has to be a realist, and I'm just not sure how much good hoping the BA will ever be affordable to us does. I'd much rather admit defeat, cut my losses, admit my mistake in moving here,accept the humiliation and get on with my life somewhere else.
Simply put, the BA is not a place for people who aren't making 6 figures anymore. We can debate all day long about how much of an insult this is to the common man, or in my case, the middle class educated professional, or basic American values. But truth sometimes cuts deep, and I'd rather invest my time preparing for the move. I swear it seems like everyone makes a hell of a lot more than me, and they are the ones bitching about how they can't afford right along with me. If things become affordable for them , then it'll be that much longer that things might get affordable for me, if ever. Get my drift?
I like productivity. For me personally, looking for new opportunities elsewhere is simply a better use of my time at the moment. All I can do now in repects to the BA is chant to myself: "crash crash crash!"
sorry. just a little blue today.

ww2,

O.K. Let's take a step back here for a little second.

During the early days of the "tech wreck" investors that owned basically a diversified portfolio of tech stocks (jokingly) said they weren't that concerned that the dot com portion of their "all tech" portfolio had taken a beating b/c the majority of their money was in "quality" tech stocks like Microsoft and Intel so no big deal. Right? What the "all tech all the time" investor didn't realize at the time was that so much of the run up they'd enjoyed in their quality holdings was built on the even greater assumption that Microsoft and Intel had based their sales projections on selling their products to soon to be defunct dot coms! In the end no one was spared.

Point being? The BA does not exist in a vacuum! How is it possible that we have a coast to coast RE crash and yet the BA stands tall, defiant and unscathed? Would this make sense? The BA may be the last to fall, but fall they will and when they do you'll finally find yourself in an enviable position b/c you can buy w/out having to sell your "mill stone" or "albatross" first! You don't have any luggage! Get my drift?

Sorry guys. Didn't mean to get all whiney. It just seems that from where I grew up and the way economics works there is so totally diffrent than here that I still can't make rhyme or reason over it. Back home if you were responsible, hard working, and saved your nickels, you'd be just fine. It isn't that way here, and living with this every day makes me think I must be doing something wrong; That I must work harder, longer, and make more money. Lots more money in fact, or come up with an ingenious plan that'll make me rich. All in the name of getting something that is still nothing more than a house back home.
Living here sometimes fills me with a lot of irrational resentment and irratation towards people who have more than myself and don't have to worry about these things as much. It's also rather humiliating to realize that these people aren't neccesarily superior to me in any way other than their profession's ability to fill their pockets with money. I'm tired of the Audis, expensive bicycles, Danish furniture, Java houses, and Euro-styled condos.
I can't help the feeling that if I leave, then I basically failed, and that the people that get to stay are the "Smart" ones who outdid me.It also makes me have fantasies that someday, I'll be in a fresh and upcoming place that nobody in the BA thought of as being cool and suddenly being the smart guy who had the forward thinking to move at the right time to a new region that was almost bursting at the seams with potential. Then I'd thumb my nose at SF:" hey ya stupid shmucks, see who's the smart guy now!"- a sort of twisted ludicrous revenge.
I know that sounds really stupid. I also realize being envious is also immature. People are people no matter who they are and what they make.
Perhaps I'm too zealous with a sense of entitlement. arg.

Conor,

I kind of liked your analogy. For the longest time we've been spoon fed that it's ridiculous to think that the housing market can crash. There is no "national housing market". All real estate is local. Stock markets crash. Not housing markets! Well if we look back at the peak of the NASDAQ in MAR 2000 it took until almost OCT 2002 to find support. To find the floor. That's overnight? Believe me, I wish it had been. Over what, a 30 month period? I maintain that right now the HC is outpacing the NASDAQ and just starting to gain momentum!

What would change MY thinking?

Uh, well, uh...... nothing.

ww2,

"see who's the smart guy now!"

They have a name for people like this; these people are called Chicago White Sox fans. They are willing to endure years of humiliation for that one glorious moment (and then savor it as long as they possibly can).

Look, we got lucky O.K! Compared to Yankees fans (or the BA) we're STILL losers! Our 2 championships to their what, 20+? The sun even shines on a dog's ass some days!

I think that I shall savor the HC (housing crash) as much, if not more than a White Sox championship in my lifetime! Researching it, nurturing it and watching it rise into some kind of hellish monster will become my crowning achievement! Bwahahahahaha!

Dinor,
One of the reasons I'm here for another 3 years is to hope that a crash will happen within that time period. That would be absolute bliss.

Conor,

I like your "tipping point" theory too. That's a good metaphor for the conceptual simulation and algorithms we were brainstorming on my blog a while back. The idea is that stuff builds up, a lot of it not really internalized by the mass herd of sheeple, then all hell breaks loose.

It's funny that in the last thread some folks were taking issue with my facts implying that I was supporting a "soft-landing" outcome. I believe that on 3/26 the title of my entry was More macro evidence of hard landing for US home prices.

I'm still biased towards a harder, rather than softer, landing. And the problem with tipping points is that there isn't a lot of room for grey. My guess (and that's a guess, not prediction) is that even a little bit hard will be a lotta bit hard.

That said, wages are increasing at the fastest rate in 5 years; now outpacing the growth of new jobs. This probably means wage inflation, which would support rent inflation, which are critical components of any possible soft-landing outcome. I don't think it's enough, yet (what I read is that it will take 3 years of this trend to correct housing prices). But anything is possible.

WWII,

Just be true to yourself and do what makes you and your wife happy. There's no end to social pressure to consume, if you let it. In fact, there's a huge number of people devoted to make you buy their products. If you get on the consuming merry-go-round you'll never be happy - the middle class envy the well-to-do, the well-to-do envy the multi-millionaires, the multi-millionaires envy the billionaires...and the billionaires are mostly crazy and don't give a shit for what other people think.

Live like a billionaire. Don't give a shit for what other people thinks.

"a little bit hard will be a lotta bit hard"

"tipping point"?

Another 1/4 point?

Not a big reaction, yet.

And for the epistemologically concerned, you can read my last comment as:

For those invested in the grand narrative of white, Anglo-Saxon, christian bias, the societal convention of quantifying control in a semantic labeled "ownership", further increases -- increase itself being but a culturally affected predisposition towards further hegemonic dominance -- would serve to further invest the imperialistic group-mythos into continued oppressive outcomes.

Randy H,

I haven't seen the wage data yet but it would have needed to occur in 2004, maaaaybe 2005 to provide any kind of a soft landing at this point. Would back filling the hole really help with all of the other issues we have going on? I mean, every time I got a raise it always felt like too little, too late so how will this provide "damage control" to toxic mortgages and appraisal fraud?

LOL Robert. I guess we do have more than a couple points of agreement.

Another point is the wage-inflation needed for soft-landing.

Here's my doomster(tm) worry:

While beavering away trying to engineer a grand soft-landing, we manage to create quite healthy wage inflation, allowing for brisk rent inflation. But it's not enough, the housing market still hits the affordability tipping-point, and it all crashes. Since it's a largely psychology-driven phenomenon, Torschlusspanik ensues.

The result: stagflation and we all get screwed bad until a leader emerges willing to face reality. Then we get the fun and excitement of 18% interest rates and such.

Randy H,

"While beavering away"

Now that we have thoroughly dashed the notion of wage increases having even the slightest positive impact on "slowing" the rate of the crash I would like to go record as saying I have never turned down a raise.

SGVPatience,

15K is 15K! What do want me to say? Even after things implode I would still exercise caution. There will be several "false bottoms" along the way but no, I don't have anything against making an honest buck. Since I've already weighed in on the "flipper issue" I would ask that any one contemplating this route to be considerate of neighbors while they are in the renovation process. Taxes will be due on STCG and it would probably best to at least form an LLC (which is another expense).

NIA

DinOR,

I would like to go record as saying I have never turned down a raise.

Neither I. Neither I.

There is a good lesson here though. Being aware of inflation is important to knowing if you're really getting a raise, or just an "adjustment". And for those of us who have to often determine their own "billing rates", keep in mind that wage inflation can quickly sour your longish-term contracts unless you can manage to build in an inflation-index protection clause.

And, when you manage to get everyday clients to accept such clauses, let me know how you managed to negotiate it, because I always get caught with the "no one else ever asks for such a thing" quandary.

SVGPatience,

All my prognosticating and pontificating aside, you'll learn much more about what you might do (or shouldn't do) from the experts here like George, FAB, and Zephyr (if he delurks for you).

I know very little about how to actually pursue Foreclosure deals. I didn't even know that a "short-sale" wasn't "selling short" in real-estate until last week. This is why I don't own residential real-estate as FAB does; I stick with what I know.

I have felt "slighted" by a raise. Infuriated? Sure. Insulted? Oh, most certainly. There's a good one. Has anybody here ever turned down a raise?

SP,

Death by a thousand cuts?

SP,

"The vet explained that he has other darts that can drop a charging elephant in less than six steps, but he prefers to use gentler ones to reduce risk of permanent damage."

What if the elephant is heading towards a cliff?

Randy H,

"no one else ever asks for such a thing"

Yeah, uh huh, bullsh*t! Everyone asks.

What they really mean is "no one" has been able to get me to agree to the clause. Here's how you make it work:

1. Timing, definitely not April 14th or the week of his daughter's wedding. Dumb! This is what others do. You broach the topic right after the 49'ers clinch their division. They land a HUGE contract. Smart.

2. Thank them for their business, reinforce and deepen the relationship. Try this; "Sam, you know I don't say this nearly often enough but we really value our bus. relationship w/you". Really, I MEAN that.

3. Show them how you have grown. "You know Sam since we've had the pleasure of having this working relationship I've added new software/employees/vendors whatever. You can make it up at this point.

4. The close. I'd like nothing more than to CONTINUE to grow this relationship and serve you even better, but that costs money, we all know that right? Look at how your overheads have grown, right? Now look, I realize there have been shortcomings/disappointments on this project, right? (Get him to say "right" before moving on). Well yes, you know THAT! Right, but they've never come from my end, right? We've always held up our end. We're looking to expand/grow our level of service to your organization and right now I can see several ways we can bring even more value. (This is the give) Now you have his interest. Give us the same vote of confidence you gave us when you first brought us on board and I KNOW you will NOT be disappointed. Up until now we've been providing excellent data/service at $200 per hour right? Well here's what I'm willing to do!

This way the guy can say that he actually got additional product or service or expertise. You can't ask people to pay more for the same level of service or the same amount of product. I've tried. It don't work.

I know a lot of this sounds corny, even dated and you'll have to tailor it to your industry but IT WORKS. Believe me.

SGVPatience,

Good luck; just remember that risk is risky. I certainly don't look like any sort of professor I've ever met. I don't even have a beard, lol. I was on the front page of a tech rag back in 97, and interviewed by a bunch of national newspapers and such for the next year and a half, but thus ended my short run of fame. (and no, it wasn't for dot-com stuff; i didn't get suckered into that circus until later).

If I were to be a US President, I would most certainly resemble Teddy Roosevelt at least in character. I'd come from neither party, I'd respect no sacred cows, and I'd be very "liberal" with my willingness to dispense rapid solutions regardless of who I had to flatten in the process, and all while smiling.

Of course, this is why I'll never be US President; nor will anyone else likened to Teddy, at least not for a long long time.

Randy H,

Btw, just b/c you get their consent to bill at a higher rate you may still have to reinforce the sale. As in they send you the check but it's at the old rate. No big. Just get them on the phone and "re-sell" them a little and it's usually no problem. They just want to see if you're sleeping and could maybe slide it past you. They all try it.

DinOR,

Thanks. I don't think it sounds corny at all. I use a lot of those techniques already, but there is a specific situation that always causes me trouble and those rules fail:

When negotiating with a huge, global, corporate. Specifically, one of the types in which procurement is purposefully compartmentalized from departments, yet empowered to veto deals sponsored by even the highest level VPs. In this case I find myself dealing with someone who is not an advocate for the same thing as my real client, but instead more of an agent for the "board & shareholders" (or so he can claim). I've managed to learn by experience how to work with this type of a setup and still protect my interests. That said, I've never been able to get these guys to accept any type of inflation indexing. (In fact, their standard boiler asks for down-side protection, but not up-side reciprocity. They want the right to lower rates if there's deflation -- as there was in software & services over the past 7 years -- AND they want protection from increases. The best I've ever gotten is getting the entire thing taken out.)

DinOR,

btw, the particular corp I'm dealing with right now prides themselves on having hired many of their Procurement -- oh I'm sorry, I mean Supply Chain Management -- Directors away from Wal-mart and the auto industry. In other words, the world exists as them, customers and suppliers. And suppliers are fungible and exist primarily to be further fungibilized.

Besides, if we can post 401 comments on the “Duh” thread, we can talk about anything, can’t we?

And 2600+ comments on the "Huh?" thread.

We have talked about toilets,
but have not discussed
sinks and faucets yet.

Sink?

Do you guys prefer stainless or porcelain?

Faucets?

Need pull-out spray.

And the faucet has to be high enough like a swan’s neck.

I agree.

How about shower heads? Any preference? I like high-flow shower heads with a hose.

I did see the return of Pepto-Bismal pink for bathroom sinks in a flyer in the NY Times.

I like round or rectangular bathroom sinks. A bowl-shaped glass sink looks nice.

Should homes have urinals installed? I have seen that only once in an open house.

Porcelain seems easier to keep clean w/out as much maintenance, but other than that I think I prefer stainless.

What I don't like are the double sinks with one side extremely small and shallow. Both sides should be large.

Porcelain seems easier to keep clean w/out as much maintenance, but other than that I think I prefer stainless.

Seamless Corian countertop and sink is a good idea too. Watch out for that hot pot on the countertop. Oops, it is burnt!

Shower heads on a hose, not fixed. Water-conservation heads should only be used if they increase pressure to compensate. (Drippy water is very annoying.) The head should also be at a reasonable height (7'?) for us normal-sized people. (I've been in houses with the showerhead at chest height. Well, maybe neck height, but it was still pretty bad.) I'd only go for a urinal if I had a cleaning service; it's one more thing to clean and take up space.

Water-conservation heads should only be used if they increase pressure to compensate.

I hate water-conservation heads. I would have to take a much longer shower and waste even more water.

I like double/multiple shower heads.

Urinal saves time (at least 10 seconds per use for men) if you pee just 10 times a day you can save 10 hours of time a year!

I have never known a water conserving toilet or showerhead that did not waste water because the flow was too low.

Exactly. I have to flush three times just to get the job done. I need commercial-grade toilets!

To conserve water, we should recycle water instead.

I spend at least twice as much time trying to wash the shampoo out of my hair using a low flow shower head.

I bet people shave their heads out of frustration with their low-flow shower heads.

Re: tipping point, and whether/when the BA will finally crumble

I think there's a quite large number of people in the BA who are just able to hang on because things have been so good for so long.
In the last couple of months, I've learned that a surprising percentage of my friends and acquaintances in the Bay Area are actually FBs, even though they appear to be well off today.

Adjusting ARMs are hurting quite a few, some are paying for day-to-day expenses with HELOC credit cards right now (and these guys are very surprised that their ever-expanding credit took them this far), others are in way over their head in terms of the size of their monthly mortgage payments.

For the last few years, there was always a way to postpone the inevitable, and so the number of people in these kinds of situations is probably much much higher than normal.
At some point in time, the music will stop, though, and it'll happen at approximately the same time for everybody.

I think we will be surprised what comes to the surface.

Somebody mentioned in previous thread -- should I use the in front of previous? -- that he saw major houses pumping gold stocks. I wonder if it is time to get out Au shares. Any thoughts?

Au moved up 8 bucks (1%) today. But the shares didn't go up as much, percentage wise (0.75%). Usually the movement in the shares is a 2-3 multiple of movement in the metal itself.

Nobody has talked about Bernanke today. Very strange.

I wonder if it is time to get out Au shares. Any thoughts?

Dumb money is not in yet.

NOT INVESTMENT ADVICE

GC:

By 'previous', do you refer to an unspecified thread prior to this one, or to the thread immediately before this? (I.e. the word has two meanings that are very similar, and choice of article depends on the desired meaning.)

If you are referring to an unspecified prior thread, 'a' is appropriate. If you are referring to a specific thread, in this case defined as the one immediately prior to the current, then 'the' is proper.