patrick.net

skibum Says:
The funniest incident was this one: Santa Rita Ave, which by many accounts is the epicenter of the epicenter (Steve Jobs lives a block away, etc etc.) has a tiny bungalow on a tiny lot for $2.5M, DOM >60. This is the neighborhood where Google money buys adjacent lots, tears down beautiful old bungalows, and builds hideous manses with footprints covering 90% of the property. She proceeded to show us in excruciating detail the recent sales of similar lots for $3M, and how $2.5M is a steal after the “correction,” basically pointing out that the house doesn’t matter - it’s the property it’s sitting on for a teardown experience. She even hinted that the next door neighbors were old, and might kick the bucket soon…

good point. i think a lot of the speculation and the overpriced bungalows is meant to have an implicit redevelopment dividend -- after all, you might get a permit to build a 40 storey glass tower on it one day...

so you should buy it, then buy the place next door, coalesce the titles and build multi-residential to house google workers after you bribe the zoning authority to give you a permit! easy peasy.

the market got us into this mess, and, by golly, my faith is so great in markets that i'm going to find a way for the market to get me out of it... [dies in spent and frustrated old age trying...]

Peter P,

That sushi date will have to wait a bit longer. Thanks for offering :)

DS,

I've already explained time and again why I don't like government subsidies except in cases of market failures. As for corporations, I don't think it's the job of corporations to worry about responsible behavior. What they should do is have inspired leadership and long term thinking. A lot of what you call social responsibility is just smart long term thinking.

Social responsibility is best governed via proper government oversight. A perfect government needs to be able to be disinterested and lay down laws that avoid moral hazards by corporations and individuals. This is the polar opposite of the current government, where everybody is shouting for their own piece of pie.

I understand government oversight is imperfect, and figuring out the right level is a difficult matter. However, I can say with certainty that the current American system is FUBAR.

I don't believe problems can simply be solved by throwing money at problems. If that means I sound unprogressive to you, then I think I'm just going to have to live in the shadow of your disapproval.

As for corporations, I don’t think it’s the job of corporations to worry about responsible behavior.

I agree. Same for individuals.

However, corporations or individuals who put serving the world ahead of pure profit tend to do better.

DS said:
i see our resident progressive who however dislikes corporate social responsibility and is a market neo-liberalist also thinks it’s ok, and is anti-environmental and anti-sustainability to boot.

Sean,
It sounds like you are accusing me of hypocrisy. I would respond, except that I find your comment completely incomprehensible and nonsensical.

As for anti-environmental and anti-sustainable.

Can you back that up? Just because I'm not willing to support every harebrained "environmental" initiative out there doesn't make me anti-environmental. I don't even know where you got the impression I'm anti-sustainablity. I might be pessimistic about humanity's odds of surviving past the next 500 years (rapidly accelerating and powerful technology advances, backward and superstitutious thinking - maybe we can beat it, and global climate change, and diseases, and crazed zealots, and our exponentially ballooning population...)

This society is still in denial over the most fundamental issues of sustainablity. We, on this blog, are still talking as if population growth is the proper response to an aging population, rather than see if we can support the aging population with a smaller (thus more sustainable) population. Americans are governed by a political leadership who believe God has created Earth for humanity's benefit and provided just enough resources for the duration of our occupation. Can we even seriously talk conservation or sustainability when these people believe they'll be raptured up before all the oil is out of the ground?

Glen, astrid,

C'mon, social engineering & government paternalism is "for the children", remember? You... do.. like children... don't you?

Peter P,

Yeah, I just don't understand why, outside of bad government policies (esp. tax policy) and shortsighted corporate faddism, why environmentalism runs opposite to the financials.

HARM,

I've compared child rearing to pet parenthood here. I think I'm already totally screwed on that account :) Nah, I get along with pets and small children, I'm just not ready to commit to either.

Global climate change is the last thing we should worry about.

Yeah, I just don’t understand why, outside of bad government policies (esp. tax policy) and shortsighted corporate faddism, why environmentalism runs opposite to the financials.

Environmentalism is the reversal of cost-socialization.

The world will better if we respect each other. As simple as that.

Peter P said:
Environmentalism is the reversal of cost-socialization.

When you say cost-socialization, are you talking about the imposition of negative externalities by market actors? If so, then I would agree that good environmental policy can force market actors to internalize negative externalities (like pollution).

The best way to do this is through the creation of market mechanisms which incentivize less environmentally destructive practices (eg the creation of a market for pollution credits) not through direct intervention in the market (eg: subsidies for "clean energy research").

Market is not everything and cannot solve every human problem.

Government policies are never efficient, judged by the market's criteria.

But mixing the market and the government will most likely create new problems worse than the ones the mixture is designed to solve.

When you say cost-socialization, are you talking about the imposition of negative externalities by market actors?

Yes.

The best way to do this is through the creation of market mechanisms which incentivize less environmentally destructive practices (eg the creation of a market for pollution credits) not through direct intervention in the market (eg: subsidies for “clean energy research”).

I would love to see that. But I really doubt it will happen.

Market is not everything and cannot solve every human problem.

Only because humanity is the problem.

GC,

Governments are successful when they achieve the highest possible level of overall social utility. Markets are successful when they achieve the highest dollar amount. However, achieving those dollar amounts (even ignoring the problems of monopolies and monopsonies) may lead to human misery and short lived societies. I think the property role of government is to mitigate the problems and unsolved issues from a free market.

Things always get a bit more iffy when government gets its hands in too many things and end up on both sides of any economic transaction.

Governments are successful when they achieve the highest possible level of overall social utility.

Absolutely true. As a utilitarian, I also link utility to morality.

I just want to point out the difficiencies in each. Both socialists and Adam Smiths are wrong.

Governments are successful when they achieve the highest possible level of overall social utility. Markets are successful when they achieve the highest dollar amount.

It also follows that the "best" set of rules should cause market and social utility to converge.

The 2M+ market has been dead since last winter. I've been tracking properties in Saratoga and LAH in that range, and most (90%) of the listings there have been around for at least 6 months. The DOM data is just not accurate cos' they keep getting resurrected as "NEW LISTINGS".

However, the 1M+ sub1.5M market seems to be still doing quite well (comparatively speaking). If this segment doesn't soften up, we won't see the 2M+ slashing prices by a meaningful margin. The 1M+ market has been strong becaue banks are still giving out toxic loans left and right.

I need to see a few 2M+ properties coming down to 1.5-2M range to declare it an initial success. All these barely 2M properties were just around 1.2M 5 years ago, and the shitter the property is, the bigger the spike, which is frustrating.

OO,

i.e. the $150K-300K/yr families with school age children are the last to capitulate. Or also the $70K-150K/yr families looking to move up?

Are you monitoring any close-in houses selling for 500K-1M? If both are equally strong, then we might see a fall off in the $1-1.5M when the investor owned 500K-1M suboptimal houses get tossed on the market.

I think the property role of government is to mitigate the problems and unsolved issues from a free market.

I agree. Government should be the umpire, not a player. Government also should not attempt to rewrite the rules to favor certain teams. Unfortunately, this is an ideal which is seldom realized.

Governments are successful when they achieve the highest possible level of overall social utility.

not necessarily. sometimes (always?) they have to meet individual obligations of citizenship, and respect basic human rights of personhood. this is very clear in all expressed and implemented policy. (although the repubs do their level best to turn it on their head, and there is a certain disregard for the plight of the poor in the US.) the highest possible level of overall social utility might be to pay judge dredd death squads to annihilate anyone addicted to drugs, the poor, the homeless, etc, but fortunately they are informed by a different ethic. you won't find the mission statement 'we achieve the highest possible level of overall social utility' in any govt dept or at the white house, although they certainly want to be efficient in carrying out their charter -- that's just a layman's misconception as informed by hazy neoliberal 'ideas in the air'.

i.e. the $150K-300K/yr families with school age children are the last to capitulate. Or also the $70K-150K/yr families looking to move up?

There is no way a 150K family can afford a 1M house even with 30% down.

On the other hand, banks will put a brake on toxic loans only after the wave of foreclosure, not before.

astrid,

I think condo is dead. But unfortunately a dead condo market is not helping out (or destroying) the trading-up process, at least as of now. Most condos are sold to first time buyers by developers, not homeowners.

If, IF, the first time buyers are still buying, since they are not buying new condos, they must be buying SFHs or townhomes from existing homeowners, which is actually helping the homeowners to upgrade, hence the support for 1M-1.5M market. Transaction volume is much lighter, but still happening.

The key to slowdown is really shutting down the stupid toxic loans. People will eventually choke on their toxic loans, but the lack of action from banks and government will just lengthen this process.

Peter P,

actually in sort of good school districts today, anything below 1M goes real fast, still. 1.2M seems to be the acceptable price point, and pushing beyond 1.5M is almost impossible.

I don't think these $150-300K families are first time buyers. They must have bought before and are just rolling their equity from the cashed out property into the traded-up house.

DS,

I'm not particularly fond of the Anglo-Saxon individual determinism or the Anglo-Saxon moral/ethics systems. It's a false dichotomy that muddies the real issues, hard decisions that have to made if our society is to continue.

Just to clarify, do you believe governments should arbitrarily enforce certain values in favor of others? Acting with taxpayer money, against the individual taxpayers' interests?

Away from social utility prespective -- how are you finding those values worth enforcing? through ethics "discovered" by a dead white male elite??

I don’t think these $150-300K families are first time buyers. They must have bought before and are just rolling their equity from the cashed out property into the traded-up house.

I believe people usually trade from 750K to 1.2M. How is the 750K townhouse market doing?

OO,

So basically, in nice areas, there's nothing but condos for under $1M? Ouch! Any townhouses or people trading up from slightly more marginal areas?

So basically, in nice areas, there’s nothing but condos for under $1M? Ouch! Any townhouses or people trading up from slightly more marginal areas?

Not really. There are quite a few townhouses under 800K in acceptable neighborhoods.

Well, I am not tracking that many types and areas, so can't comment in general.

But my hunch is, after these mindless, desperate parents get out of the way, the market will look much uglier when the fall is around the corner.

Also, we need the banks to tighten up further. It is simply NOT right when I walk into a US bank branch now and still get attacked by I/O Neg-am loan pamphlets. Apart from US bank, are there any other banks that are living dangerously and therefore should be avoided at all cost?

(Do not want to go through FDIC to get my money back)

Also, we need the banks to tighten up further.

It will happen only after the bust.

But my hunch is, after these mindless, desperate parents get out of the way, the market will look much uglier when the fall is around the corner.

I will avoid them at all cost. My instinct tells me that good school districts are over-rated.

I don't know about whites, but I know the Chinese families are pretty obsessed with getting their kids into the right school districts and getting them off on the school/career hamster wheel.

I think if the parents were truly interested in the best possible education for their kids, then a move out of state is probably the best solution. The best public/private schools are not in California anyways.

I don’t know about whites, but I know the Chinese families are pretty obsessed with getting their kids into the right school districts and getting them off on the school/career hamster wheel.

Yes, but a glorified rat race is still a rat race. I do not know why Asian parents are so obsessed with competition. I think averting competition is so much better.

I think if the parents were truly interested in the best possible education for their kids, then a move out of state is probably the best solution. The best public/private schools are not in California anyways.

Perhaps. College education is far more important though.

DS,

Let me get this straight. You think government will be more disinterested if they hand out subsidies and have direct money investment in the market, than if they just stick to regulating it.

What I say may sound like a truism because it's so bloody obvious, but I've yet to see you demonstrate comprehension of the big picture. You're proposing band aids to systematic problems, without understanding the underlying dynamics and causes.

Furthermore, dispite the rather large amount of time you spend on this blog, you don't seem to have picked up any knowledge other than the occasional pieces of information that affirm your original thinking. I really don't think you get how America's economy and America's government works. Nor are you willing to acknowledge the disasterous history of too much government intervention in the economic lives of citizens.

I’m not particularly fond of the Anglo-Saxon individual determinism or the Anglo-Saxon moral/ethics systems. It’s a false dichotomy that muddies the real issues, hard decisions that have to made if our society is to continue.

Away from social utility prespective — how are you finding those values worth enforcing? through ethics “discovered” by a dead white male elite??

aren't your beliefs self-inconsistent? one moment it's individuality, the next moment it's 'the greater good for the greater number', which denies individuality and individual rights. these two things are normally held to be at opposite ends of a continuum in social science thinking.

there has been a lot of foundational ethical philsosophy put forward by 'living non-white females' since WWII, given that the dead white males ethics seemed to be bollocksing up the whole planet -- although you are unconsciously echoing the dead white males ethics more often than not, as that is where the mainstream is usually at -- about 90 years behind the philosophical times. have a look at hannah arendt and seylah benhabib, for instance, and the 'ethics of communicative discourse'. or jurgen habermas. think about post-colonialism, etc.

hard decisions that have to made if our society is to continue.

that's just rhetoric, and i woulnd't give it 1/10 for thoughtfulness in a Sociology 101 essay. society will continue.

Just to clarify, do you believe governments should arbitrarily enforce certain values in favor of others? Acting with taxpayer money, against the individual taxpayers’ interests?

well, governments do, don't they? it's called the legal system and the legislature. besides, no man is an island, hmm? i can't rebut every point and self-inconsistency you make, because there are too many, and the level of insight isn't very high, but i have to say there is a lot of thinking to be done still -- just repeating all the blustering of average, dumbed down(usually male) taxpayers about how their dollars are being wasted doesn't really constitute an argument, nor repeating superficial neoliberal dogma drawn from the air which doesn't withstand scrutiny, etc. unfortunately, much of american politics is all bollocksed up as well, but i argue that is largely because of corruption by the market. as gore vidal would say, the american experiment started out well with good intentions, but it has been completely corrupted over time, especially over the last 60 years.

all this stuff would get cleared up in a week if you did Governmentality 101 and Sociology 101 etc... not saying govt is perfect, or perfectly efficient, because it very clearly is not, just necessary... i don't think many politicians or govt workers are even particularly noble, it's in extremely short supply -- it's a miracle anything works at all...

altho one significant arm of leadership in the community IS govt and the legislature, you can't expect much from so-called business leaders who are very patently too busy running their cos and trying to make money to get involved in big questions...

i'm not objecting to the nature of social organisation and criticisms of govt, just to the level of analysis here and the shibboleths that are getting flung around...

Actually, I'm a full fledged utilitarian and I advocate it for social policies. The individualism part comes in on an individual level and because I'm not convinced governments and social institutions always know the best way forward. I don't believe individualism for the sake of individualism, and I think that spending huge efforts to "save" self destructive people is usually a bad thing to do with society's limited resources.

There's a difference between collective action problems and government taking leadership on something very few citizens actually want. Most people want some degree of policing, clean food, garbage collection. The balance of costs and benefits fall with a uniformed centralized system.

However, you want to go much further, for government to usurp market players. Furthermore, you want the taxpayers to subsidize certain kinds of behaviors, even though similar past efforts have lead to less than great results.

I know very well how inefficient and conflicted governments are and how slow societies and companies can respond. And what I find is that generally, the lighter the touch, the better the results. Generally, it's better to let people find their way than for a few in the government (there based on a very flawed electoral system) to show their "leadership." I have seen what too much government leadership, even with a great deal of good intentions and idealogical purity, can do. And it's scary as hell. Try checking out history 458 and the like, once you start exploring the unvarnish record of the recent past, perhaps you'll be a bit less certain that your ideas are necessary the right path.

I am against utilitarianism, even though at times I may opt for a utilitarian approach. That is, subconsciously.

I believe the debate shows the wide chasm between the new world US of A and the old world Europe.

Generally speaking, those who have made it will tend to distance themselves from "utility," not only to "wash" themselves but also to set an examplary model to dissuade the unwashed from trying to surplant their luck-won positions. This "distancing" was achieved via a cultural, spiritual and legal brainwashing in the old world. But unfortunately in the new world, nobody gives a damn. Hence, the constant popping up of the "new money" and exaltation of "utilitarianism."

Sigh ...

Nobody who posts on this board is rich and secure. Not a single one, myself included.

Life sucks if you don't play sports.

"using phrases like ’society’s limited resources’ also gets you 0/10 in every soc 101 and gov 101 essay, when it is very clear there is an abundance of resources, people just have trouble distributing it."

That is so easy to disprove, I don't know why you bother stating it. Firstly, most American college instructors would be impressed by a mention of society's limited resources from their lower level gov or soc students. Secondly, try to distribute the resources of present day Dafur or provide healthcare to HIV positive Angolans.

Furthermore, don't put words in my mouth. I have never advocated criminalizing stand alone drug use, ever.

Anyways, rather than go about insulting my education, as you have done previous with others in your arguments, howabout you tell me what you learnt in Gov 101 and Soc 101, in a systematic manner. IN A SYSTEMATIC MANNER, not your free form citations as retort to other's direct questions. How can you prevent the pitfalls of too much government control and waste? How do you know your ideas are not half baked?

However, you want to go much further, for government to usurp market players. Furthermore, you want the taxpayers to subsidize certain kinds of behaviors, even though similar past efforts have lead to less than great results.

I know very well how inefficient and conflicted governments are and how slow societies and companies can respond. And what I find is that generally, the lighter the touch, the better the results.

it's not my ideas, it's a comparison of how well a whole lot of countries are doing as a social experiment, and getting the right balance between market and state.

i'm glad you've done an unbiased and fully informed study of how well 'the lighter the touch, the better the result' works across a dozen OECD countries, carefully comparing and contrasting different forms of social welfare.

that's why the US health system comes in 37th in the world, noted particularly for its 'denial of access to healthcare for those who need it' compared with other countries, and its expensive pharmaceuticals and regressive nature. more on this earlier in the thread. hence why michael moore is making his latest film. the light touch.

you haven't given one example of how well the 'light touch' works, and you seem oblivious to the huge amount of regulation that is all around you to try to maintain a safe healthy society. even regardless of the notoriously high level of corruption in US politics.

and note that the 'market players' have been completely allowed in the US system to corrupt congress by individual donations with strings attached, unlike the systems in most other countries. also, elections in the US cost much more and leadups run considerably longer than in other comparable countries, for arguably no better result, which is also 'wasteful of resources'. it's high time america had some political and electoral reform on a huge range of fronts, particularly concerning impartiality and transparency. it's almost a textbook on how not to form a govt.

but all this rhetoric about 'market players' is just so much uninformed balderdash. you're just spouting a confused mish-mash of jargon and fuzzy thinking and sometimes PR and lobbying propaganda from those market players, all unreflexively stirred together.