patrick.net

Robert C,

I was assigned to RWS (Runway Support) the arresting gear and also did line maint. Are you serious about having designed the gimbal? I remember the "fixed" fuel probe was only about 2 feet from all those expensive electronics though!

skibum,

Me too. If we can have "bubble fatigue" why not "MBS going down the tube fatigue"? Maybe that's why I just breezed through the article. 2 years ago I would have read it twice. Now?

When they demolish buildings with dynamite I'm sure some of it doesn't go off. But you know....... I'll take their word on it!

SQT,

I believe that was the "RF-4B" and it was a "recon" bird. They had a camera and sensors in the nose that made it look like a shark. Unlike John McCain's A/C the A-4, the F-4 could be pretty well "ventilated" and still bring the crew back. Leaking, limping and losing altitude, but back.

Robert C,

You know that is so interesting b/c the off center arrestment is a real nightmare for everyone involved. The Aircraft Handler is sweating bullets that some "bolter" is going to go sideways through the aft slash and even if they take the wire I believe if it exceeds X tolerance the greenshirts have to come out and replace it. Even if that was the cables only "hit". That and when you drag an A/C sideways it has a tendency to scuff the rubber right off of the tires. So even if nobody gets hurt it's still a mess.

We actually had a few nights were A-7's (the Corsair) would be low fuel and bingo to Cubi and we'd have to take one in Gear #4 and then his buddy would go right over us (hook down) and take Gear #3! Talk about having your heart in your throat. I swear if the canopy had been up the tail hook would've taken it off. (At least it seemed that way!)

Sorry about your friend.

"The RF-4 was supposed to be a stop gap"

You know Robert, those crews were very different than the regular fighter jocks. When fighter guys would park the bird all they wanted to know was where the best go-go dancers were etc. The recon spooks couldn't have been more different. We'd give 'em a ride up to the Officer's Quarters and it was usually a quite ride. Often they didn't even check in with Ops. Dept. After they left there wasn't much of a record they'd been there at all.

SQT,

Oh I gotcha ya! I've always regretted not having taken any pictures of any of my duty stations. Our rainy season shenanigans would have made for some cool pictures. There were these two kuh-razy guys that used to take our little Mistubishi pick ups and "launch" them off of these 4' high ramps! We called them the "Dukes of Cubi"!

SFWoman,

I didn't think Block Island was big enough to even have an airfield. I'm told it was the site of much skullduggery back in the day.

newsfreak,

When this is over,
I would like to know why the economy needed this bubble?

I would like to sign up for the ECON class on this bubble.

I submit to you that the answer is "undefined".

The economy is an emergent system, not a deterministic one. It abides by the same abstract pressures as biological evolution. It adapts, specializes, suffers extinctions, and spawns descendants. Also, like biological evolution, it is undirected. There is no "goal", other than continued existence. No particular state is more or less desirable than any other from the abstract perspective, although it is of grave concern to the participants at any given point in time.

As such, we endeavor to intervene in the economy to direct its outcomes where we want them to go, the same as we do in our own biological environment. Such intervention doesn't always work or have the anticipated results.

It's not coincidental that the best economic computational models are based on evolutionary algorithms, themselves borrowed from biological processes.

When I found out that blocks of 20-30 units were being being sold in my Miami Beach condo building, I knew it was time to get out.

If God doesn't even accurately know where and how fast an electron and a photon would go after a collision. How can s/he know anything about a real estate bubble ?

Roll a dice. Your answer is as good as God's.

The number of listings in San Jose/Santa Clara County are up to a new high, according to this:

http://bubbletracking.blogspot.com/2006/09/tracking-san-josesanta-clara-county.html

Hey, can someone remove this dude Nussbaum's spam from the thread?

Danielle Steele Says:

> No, no. Read my book! IT will make you rich!

Glad to have Danielle on the BLOG...

How about hosting the next BLOG party at the Spreckels' mansion?

astrid Says:

Michael Holliday,

Thanks for the rec. That album has been in my Amazon wish list for years, but I never got around to purchasing it. Though for the housing collapse, I’d recommend some Mogwai and Explosions in the Sky.
_____

Sounds good, bro!

You probably remember operational A-4s my secret love and probably your secret demoness with the gimbal nose gear. The designer explained why so if you are interested.

Dude, you fell out of the geek tree and hit every branch on the way down ;)

newsfreak,

I'm sorry to hear about your injury. I hope everything will heal soon and be as good as new. I hope you'll soon find a great job that respects you and provides great health insurance.

Surfer-X,

This site doesn't discriminate between geeks and tanned surf gods. It only discriminate between stupid home buyers and people with brains.

FAB,

What was Hillsborough like when you were growing up? Was it always prime?

From what you wrote, I sensed that Baywood/Highlands were nicer areas than they are today, relatively speaking of course, because I know of a couple of friends who cashed out of their homes in Baywood to move to Burlingame. I was rather surprised that they would move a few blocks but according to them Burlingame is decisively nicer than Baywood San Mateo, so either Burlingame shot up real fast, or part of San Mateo slowed down quite a bit.

Regarding prime turning non-prime, I think the chance is much higher on the East Bay, Mission SJ for example. From SF down south, the west side is simply geographically more appealing, and given the way our geography is laid out, any current prime spot on the west is quite protected, unless something drastic happens to the Bay Area as a whole. Mission district is an one-trick pony, school scores, so for whatever reason if that factor goes away, there is really not much left to be desired in that location. Or, places like Danville and Alamo, supposedly prime as of today, but if global warming is here to stay, and gas price keeps creeping up, I am not sure how prime these places are going to be going forward.

Did Half Moon Bay become less prime over the years?

About those Very Light Jets,

Oh, wouldn't that be grand! But lets get real. If it was about economics, the Czechs or Romanians would have been selling inexpensive upgraded versions of old commie trainers to us years ago.

The USA is crawling with jet pilots. Many would be in a position to coop on a under $1 million fun craft. Lots of colleges could use them for flight courses. But they ain't gonna stay cheap. The Eclipse was supposed to be delivered for under $800,000, the estimated price now is over $1.2 million.

Now factor in LegalMan. Eclipse will be sued out of existence the first time some incompetent crashes one. Jurys and the public do not give a damn about general aviation, and won't sweat handing out awards that ruin it.

Before LegalMan, during the 60's and early 70's, a new entry level Cessna and a Corvette were the same price. Used planes could be affordable for working men. Lots to choose from, too - Piper, Cessna, Beech, Grumman, Bellanca, Navion. An entry level Cessna is now $180,000. In the early days after the lawsuits, $20,000 of the C-152's $35,000 price was to cover apportioned legal costs.

LegalMan will kill the everyman jet just as fast as he killed the everyman weekender pilot.

Did someone say they had a relative who took video from an F-4 over the Ho Chi Min Trail with a handheld video camera?

God, you must be young. I assume you mean 8mm movie film. Video cameras did not come out until late 70's, and even then the were very bulky two piece affairs. The camera was the size of a shoebox and the recorder was like a suitcase.

I took Hi-8 films flying over Iraq in the 90's. I wanted to get shots of the fires where out allies the Turks had bombed our allies the Kurds.

Muggy,

Rising rents do not in any way invalidate the legitimacy of the current housing correction. Historical corrections in the Bay Area, according to various data I have linked here and there on my website, have pretty much always occurred during either flat or rising rental markets. None occurred during declining rental markets as a median. Now I'm sure someone here will post an anecdote about someones rent that went down in 1993. But the data is the data.

The negatives to a two-sided convergence, if you're a fence-sitter, are primarily wrapped up in the way it erodes the purchasing power of your savings towards a purchase. Simply because your benefit is eroded by inflation, and taxed away by landlords to a degree. If rents stayed flat or decreased, then every dollar you have would go towards buying a home at some point in the future.

The positives of the two-sided convergence outweigh the negatives, in my opinion. (1) the correction will be faster. (2) therefore you will be able to/will be forced to buy a home faster. (3) the local economy won't suffer as much.

But, don't have any illusions. This bubble is so big that most of the movement will be on the house-price side, not the rent side. Even if rents went up by 50%, house prices would still need to fall substantially to revert to sustainable trend. And rents won't go up 50%. Maybe 15%-20%, in the worst case.

Some general data for the Bay Area (San Francisco/San Jose MSA):

Real-price declines (from 1975 to present):
1980-1982
1984
1990-1996

Median monthly rents (rounded to $50):
1980: $550 **
1981: $700 **
1982: $750 **
1984: $800
1990: $1200
1991: $1250
1992: $1300
1993: $1300
1994: $1350
1995: $1450
1996: $1500

The periods ** are the biggest real-price drop in house prices, and the largest % increase in real-price rents. Note this period was a substantially shorter correction than the 1990s correction when rents were stagnant until the end of the correction.

It’s not coincidental that the best economic computational models are based on evolutionary algorithms, themselves borrowed from biological processes.

wot, greed and fear?

Of course, the vast majority of RN’s are fabulous (on an individual basis), but there is a bit too much labor movement, union-y stuff in that profession, imo.

well, not too many nurses are running a small jet and a fun plane, on the other hand. how else are you going to put a floor under your wages (other than becoming a doctor)?

NPs are almost non-existent here, unfortunately, it's still in the dark ages to do with entrenched power of doctors. altho the cost of doctors' labour is lower than the US, which may be one of the drivers for NPs...

on the other hand, you would get free treatment for the screw damage at outpatients or a medical practice as a matter of course, regardless of employment or health insurance cover -- you need to lobby your lefty-liberal puke congressmen to bring in socialized medicine... oh, already been tried... those shape-shifting reptile repubs always want to block it for some reason...

jeffolie Says:
If G-d did not allow the housing bubble to happen, the economy would have gone straight to HELL.

i think it was just limping along even WITH the low interest rates, wasn't it?

In 2001 Greenspan knew the dot com bust was going to bring down the economy hard. When the scope of the decline became clear, he lowered rates to 1% and expanded money supply, bringing on the housing bubble. He fueled it by encouraging ARMs.

this is the problem with just having one regulatory lever to try to do everything... keeping with the flying theme, it's like fitting a plane with just a throttle and expecting it to do wing trimming as well...

did greenspan actively encourage ARMs? if so, why? (not option ARMs or negAMs i presume)

Median monthly rents (rounded to $50):
1980: $550 **
1981: $700 **
1982: $750 **
1984: $800
1990: $1200
1991: $1250
1992: $1300
1993: $1300
1994: $1350
1995: $1450
1996: $1500

now can you adjust those figures for CPI? :P

say, 2-3% a year? (compounding) if rents go up 15-20% a year, i fear everything else will as well -- goods and services = inflationary spiral...

extreme inflationary spirals don't hurt housing specuvestors, i spose, because it devalues their original mortgage amount and lets them charge more rent -- at last the dream vill hav kum tru... we will have created a brazil-like economy just to keep the poor little muppets happy...

New thread: From Hi-Fi to Wi-Fi to Re-Fi

OO Says:

> What was Hillsborough like when you were growing up?
> Was it always prime?

Hillsborough has always been super nice, but the city has changed… When I was a kid the city was made up of the “super rich” people I caddied for at the Burl CC who were decedents of the PU Club and Bohemian Club guys who controlled the state in the late 1800’s and the “working rich” the young doctors and young lawyers who could buy one of the modest ranch homes built on one of the subdivided estates for under $100K until mid way through Carter’s presidency. Today the city still has a lot of decedents of the power brokers of the late 1800’s, but unless you play golf at Cypress, the Burl CC or the SFGC or head up to the Grove for Spring Jinx or the Summer encampment you don’t see much of them. Many of the young professionals that bought in the 60’s and 70’s have moved on and in recent years the tech. guys have been tearing down a lot of the $3mm single story ranchers to build McMansions.

> From what you wrote, I sensed that Baywood/Highlands
> were nicer areas than they are today, relatively
> speaking of course, because I know of a couple of
> friends who cashed out of their homes in Baywood
> to move to Burlingame. I was rather surprised that
> they would move a few blocks but according to them
> Burlingame is decisively nicer than Baywood San
> Mateo, so either Burlingame shot up real fast, or
> part of San Mateo slowed down quite a bit.

The Baywood and Highlands areas of San Mateo are very different. Many say that “San Mateo Park is the best area of San Mateo, but I have always liked Baywood (that is a little more suburban but has some amazing homes designed by legendary architects) better. Baywood is the area of San Mateo just west of downtown and just south of Crystal Springs Road that borders Hillsborough, and my High School that was designed by Willis Polk For Templeton Crocker (of the Crocker Bank, Southern Pacific Railroad Crockers) and his wife to be Helene Irwin (of the C & H sugar Irwins) . The San Mateo Highlands is an are of mostly flat roof Eichler homes at the top of the hill just north of 92 and east of 280 and due to fog pouring through the Belmont gap the Highlands has the second worst (foggy and windy) weather in San Mateo. Even without considering the bad weather most of Burlingame is nicer than the Highlands area of San Mateo, but in my opinion other than a few streets in Burlingame Hills (that is actually outside the Burlingame city limits in unincorporated San Mateo County) the Baywood area of San Mateo is nicer than all of Burlingame.

> Did Half Moon Bay become less prime over the years?

When I was a kid Half Moon Bay was a lot like West Marin with mostly actual farmers (the Half Moon Bay High School yearbook had “future framers” in the senior poll and a photo of the 4H club next to the surf club in the early 80’s) and some random hippies. Other than a few nicer new home developments the coast has not changed much since I used to ride the Sam Trans bus to Half Moon Bay in the late 70’s to go Boggie Boarding. Things would be a lot different on the coast today if the tree huggers had not stopped Highway 1 and 92 from becoming full freeways and stopped Interstate 380 dead it it’s tracks at 280… I don’t know who would want to live over at the coast since it is almost always foggy (Montara just north of HMB is the “foggiest spot in the US) and traffic is a nightmare (especially when Devil’s slide collapses every few years)…

Perhaps hard landing is now out of the question.

http://tinyurl.com/n3pnd

DS,

now can you adjust those figures for CPI?

They are already adjusted into real dollars.

urk. so the $550 in 1980 was really $400 or something at the time? (and which of the dollars are 'real'? ;) )

in that case, median rent, after adjusting for inflation or CPI increases, has gone up 300% in 26 years in real terms? due to the info tech boom in CA? then maybe you need to adjust for median wages as well...

FAB,

thanks for the very insightful information on the Peninsula, an area that I know little about. It's just incredible that a small stretch can have so much variance of micro-weather. The South Bay, on the other hand, seems to have a bit less difference in weather except up in the mountains.

I've been to Half Moon bay over a couple dozen times and I only saw it once without fog.

Randy,

I fear the correction will be a lot more drawn out. Bernanke is no Volcker and a mercifully quick correction seems unlikely. The political outlook for quite action is very bad. Bush II is the lamest of lame ducks and the legislature is gonna be close and combative after the November elections.

i will arbitrage some socialized medicine from over here, newsfreak... ;)

DS,

Those are the numbers. Come to my blog if you want to download the data sets.

300% increase in 26 years in real terms is not out of line for expectations. Even depressed areas of the US like the Midwest have experienced over 100% increases during the same period.

Further, the medians for this area moved dramatically over the past 26 years as the demographics & population changed rapidly. Real rent medians can climb quickly when more high-rent units are constructed over 20 years (which includes SFH rentals).

You're an empirically literate sort. Don't just mock the data; come up with some contradicting data and we'll talk. I love contradicting data.

test message trying to post from the treo.

You’re an empirically literate sort. Don’t just mock the data; come up with some contradicting data and we’ll talk. I love contradicting data.

??? I'm not mocking it -- i'm looking for explanations for 300% increases in asking rents -- as per the 30% of household income housing distress benchmark. i just want to make sure the data is adjusted for wage inflation before drawing any conclusions... there has probably been a huge demographic shift due to hi tech industries starting up in the last 25 years. a number of factors have to be controlled for or explained before making any firm conclusions...

Larry Nusbaum,

You are correct, but you are ignoring something. Alternative returns.

In your analysis, the owner who sells out of the bubble before the top did nothing with her extracted equity + her net savings from renting versus owning (which is about 2.5x in the Bay Area).

There were really only slightly less than 2 years of real-gains in housing prices in the Bay Area that significantly exceeded the returns one could have earned in a well-diversified, tax-managed investment portfolio.

Given that, the owner who exited, banked their equity, invested both the extracted equity and incremental savings, then buys back in when price reversion occurs: comes out dramatically ahead of the "buy & hold" owner.

That's assuming the bubble bursts, and in a timely fashion -- sometimes they take years to unwind. I think another faulty premise is the assumption that you should be 'playing' residential real estate like some sort of speculative penny stock, rather than just letting people buy places and live in them at reasonable, affordable prices and thus ensure a decent social settlement.

Larry's site on the one hand seems to be downplaying fears of a bubble, and on the other hand providing huge amounts of advice on how to buy foreclosing properties cheaply. a lot of foreclosure purchase advice is stock standard seminar material, already written up in lots of books and binders over and over, in large type with big margins and lots of empty pages for 'notes' -- every time the seminars blow through town, the Town Clerk gets hit with frenzied requests for foreclosure lists from 100 people at once...

The advice is mostly about how to exploit others' unfortunate situations for your own attempted profit.

I see. People want to know about foreclosures. Some of them may be on the pointy end of a foreclosure themselves before long, they have reached record highs in the last 2 years in this country due to the boom unravelling and interest rate hikes. One place bought for $260K in 2003 just sold for $90K. Another bought for $460K sold for $240K. I've posted links to both these stories recently in this blog. Both of these 'corrections' brought asking price reasonably back into line with rental returns, pointing to prior irrational exuberance (aka 'bubble'). It would seem to me that right now IS a good time to be discussing cashing in on foreclosure sales if you had a mind to.

I am the calm in the eye of the storm.

The "still point" of the "turning world"?