patrick.net

Restating my position on household income as a share of housing costs: I still maintain that it is relatively impossible to find any direct data supporting *cause and effect* related to the number of earners per household. There is a correlation, but what's to say this isn't an effect of increased money supply and thus monetary inflation effectively reducing the overall household real-purchasing power? In fact, what's to say that 2nd earners aren't a _reaction_ to a larger force that's not only forced women into the workforce, but also is responsible for reducing per-household share of GDP, and therefore pushing up the share of housing costs?

Maybe it's just the way I look at the whole, but blaming this-on-that is pretty much *always* wrong. If it were only really that simple...

DinOR says:

I served w/many of Her Majesty’s sailors and soldiers and most of them were pretty sharp guys. Many had (or were working) on their Associates and ALL of the officers had higher degrees.

I know a few myself, having worked on a military basis in a civvy contract, and know some of the lore from the old hands. I'm even looking at enlistment as a way of paying for med school myself right now ($30K per year salary + bills, textbooks and tuition fees paid while you study full-time). Of course the officers don't buy V8 supercars as a rule. And infantry are different from air force and navy in certain material respects. I'm not saying they ALL do that, just that an appreciable amount of them don't save as well as they could... And I would only ever enlist if I came out with a VERY useful civilian qualification as part of the deal...

although I might buy a Peugeot 407 with all the extra moolah ;)

DS,

The guys I spoke with said they generally encourage the guys to stay single and as a result offer retirement as early as 12 years service. That and we got to have a beer w/dinner! When we went on board "she" was almost brand spanking new so I'm sure they probably got the best and brightest for the commissioning crew. Some "pre-com" crews can be downright arrogant!

New York has its own eco-system. :-) I’m afraid that I’m not a fan of New York - too claustrophobic and urine smelling (even the post Guiliani visits).

The urine smell aspect is FAR FAR worse in SF than in NY.

I'm not sure where in NY you've been going.

Either that, or I spend way too much time in SOMA and Market St.

Yeah, Navy would be particularly hard, as spending a lot of time away at sea. I think that would be the hardest gig, and I'm really not sure how it sets you up for a long-term career (not that it's intended to), plus putting family on hold. The forces are struggling with recruitment right now, with unemployment rates low, and they are prepared to accept one-eyed pirates with wooden legs at the moment (not too far from the truth). Speaking of arrogance, it was always a little scary having lunch at the mess when the SAS or Navy divers were visiting, as superfit guys who don't take crap from anyone... I would look first at air force or army, my sis happened to be a doc in the air force...

Could some current NYers e-mail me: burbed @ burbed.com

Thanks!

This sounds surprisingly similar to DS's proposal from a couple threads back...

http://www.forbes.com/personalfinance/taxesestates/2007/01/21/china-real-estate-markets-emerge-cx_vk_0120markets01.html

Tax Fears Roil China Developers' Stocks
Vivian Wai-yin Kwok, 01.21.07, 6:00 PM ET

Hong Kong -

Shares of Mainland Chinese developers fell nearly 20% at the end of last week in Shanghai, Shenzhen and Hong Kong, as investors fled the sector in a panic over an upcoming land appreciation tax...

Off topic but - I say the more information the better!

http://tinyurl.com/yueymc

I just showed this blockshopper web site to my wife. She said "we'll never buy around here again!" Maybe I should take back my previous comment.

DS,

You asked about eligibility for rent control in SF a bit ago. FAB might know the exact year, but I believe it is based on the building's age, and has absolutely nothing to do with the tenant's income.

I have a friend (a money manager), she has a low seven figure income, her husband a mid six figure income, they sold a house on Broadway Street about three years ago for close to $8 million (losing a small amount in the three years they had held it), and then renovated an apartment in the most beautiful rental building in the city and moved in. I believe she has a ten year lease. She was so excited, because her monthly rent is not that much higher than her property taxes were and she has no maintenance issues. For about a year she kept trying to convince me to do the same. (My property taxes are absolutely nowhere as high as hers were, the numbers wouldn't pencil out for me). Her apartment is under rent control.

Paul,

BlockShopper is hysterical. The photos! I can picture some of the write-ups I'd have in my neighborhood:

"Slightly trampy second wife forces dotcom millionaire to upgrade to Broadway house at $4.95 million"

"CFO buys house he can't afford on outer Vallejo Street."

"Wife who signed prenup forced to move to the Avenues, husband upgrades wife and house."

These would, of course, be accompagnied by photos from the society pages.
Did they take photos from corporate websites to use on the BlockShopper site? It is so weird.

SFWoman Says:

> DS, You asked about eligibility for rent control in
> SF a bit ago. FAB might know the exact year, but
> I believe it is based on the building’s age, and has
> absolutely nothing to do with the tenant’s income.

All residential rental property in SF built before June 1979 is covered by rent control except single family homes (SFHs) and individually owned condos with a tenant that moved in after 1996 (homes and condos with a tenant who has been since before 1996 are still under rent control). Anyone that adds an illegal unit to a SFH makes the property (in the eyes of the Rent Board) a multi unit building and both units will be under full rent control.

Interesting comments on rent control and S.8. Rent control was originally envisaged to obviously help out people on 'lower' incomes get a place in the city, etc, a la 'inclusive zoning' -- the practice of tying it to a building and then not vetting new arrivals on income level makes it a little pointless further down the track.

The unanticipated consequence of Sect 8 seems to be to disincentivise workers from earning more, also a problem. It's the same here, where you can get unemployment benefits for life (or find a way to get classified as 'disabled') and get your public housing -- there's a point where you don't want to earn to much to lose your benefits, or not find work at all. There's a threshhold band where any 'rational actor' would actually be committing economic suicide by finding a job, it would make life altogether too hard.

However, I both think these systems could be managed better and made to work better. The housing dept here should definitely be looking at the people driving Beamers and Mercs in public housing, as well as the others I heard about with boats and SUVs outside their places.

lots of typos. both think = think both; to = too; etc

FAB,

Thanks for those details about Section 8.

I don't think I like either of those mechanisms you describe, too easy for both tenants and landlords to game them.

Though I'm not seeing the note of desperation Muggy noted above in local rental ads, it seems to me there are an unusual - and growing - number which claim 'never lived in' or 'new everything'. Clicking on the pictorial ads produces pdfs of pergo and those tiny hanging Murano lights.

Weirdly, we still have the 'fire your LL' and '$197/mo 3/2/2' negAM ads mixed in with rentals. After something of a dip during the hols, the number of entries is swelling again - nearly double the volume of Sept '06.

Tangentially, I wonder who'll buy all the KingCab Dodge Ram V10 duallies which subcontractors seem to favor here...

Spike66,

I'm sure the firm both securitizes its own and deals in other's MBS. The unloading probably applies to both and may have to do with buy-back provisions of loans themselves. Here's an interesting article...

http://tinyurl.com/28xy5x

spike66 says:
"I’ve cashed out of the market, and switched mmarket funds at Vanguard just to make sure there were no MBS or agency bonds in its holdings."

spike66, did you switch bond funds at vanguard too? my bond fund there has MBS in it and I'd like to find a different fund...

SJ,

I believe Obama attended the Punahou School in Hawaii.

He did go to the Punahou school (Christian school). He was known as 'Barry Obama' while there.

http://www.punahou.edu/

I don't know about his politics, but spreading rumors that make him look like some sort of radical Muslim is a Rovian tactic if I've ever seen one. I'd like to see people elect someone based on their worthiness and on actual character this time around, not based on rumor and innuendo. His middle name is Hussein - big deal.

ajh Says:

> FAB, Thanks for those details about Section 8.
> I don’t think I like either of those mechanisms
> you describe, too easy for both tenants and
> landlords to game them.

A couple reasons that landlords like Section 8 are:
The rent goes up EVERY year (even if rents in the market are dropping). I have seen some rent rolls where older Section 8 tenants who have been in the building for a long time are paying 50% more than the other tenants…

Section 8 tenants don’t pay a security deposit but since the units are inspected at move in (and once a year) the landlord will get paid for damage if the tenant thrashes the place. Many landlords do the work for next to nothing then submit a bill from a company they own and make thousands extra on most Section 8 move outs…

FAB,

That explains why there are a few section 8 buildings on the outskirts of Russian Hill and Pac Heights. If you've held a building for a while and don't want to put in upgrades you are guarenteed to get your rent from the tenants. There is a section 8 building on the corner of Vallejo and Van Ness. The building looks maintained, but there is always discarded furniture from someone moving out and a couple of people in the building are always feeding pigeons. Nobody has curtains, everyone has a different blanket as window covering. As I was walking by once I actually asked someone in the building why noone had curtains. She said "We're all section 8!". I went home and looked it up, and that's how I learned about it.

Nigel Swaby,

Thanks for the update! You just had to know that guy was full of it. Near as I could tell he was w/3 or 4 different mortgage firms in under 2 years? (His record was so spotty it was hard to tell). He boasted a pretty decent income for a guy w/basically NO experience, contacts or connections.

I'm not sure how or even IF RESPA regulates these issues but it sounds to me like this clown was his "own" best customer? The NASD has a formula for just how much a stockbroker can generate in comm. for his/her own account. It's been awhile since I took the "65" but it seems to me it's around 5%? Well if this guy had 15 props. in Phoenix and another 7 in NM and made them nice "thick" deals with a great payout to himself that accounts for quite a bit of his purported income.

A question to all.

What is a good way to play oil ? I believe we are near bottom and I am curious as to how I can bet on the price increasing from this point.

I have XLE which doesn't correlate one to one with oil price. Last year I looked at DBC and USO, but wasn't clear on how well they will track the price of oil. I do not have any account where I can trade futures.

USO sounded very promising. Does anyone know more about it ? Will it track the increase/decrease in crude oil by the same % points ?

Thanks.

goober,

Those are some fighting words. I'm fine with "that weasel scum bastard Edwards." At least he wants to get the hell out of Iraq. I don't care what Obama's credentials are or his natural charisma, if he doesn't recognize Iraq for the hopeless and ever expanding pit of human despair that it is, Obama is dead to me.

Spike66,

True on both counts. When I'm in New York, I stay at a rather sketchy part of the Bronx. That may influence my feelings against New York. Whereas my primary exposure to SF is the very northern tip.

Urine smell actually compares favorably to the rotting watermelon smell of a Shanghai summer...but Shanghai is *home* for me.

Goober says:

"Anybody but that weasel scum bastard Edwards…….. "

I agree. We don't need anyone in office who made over $20 million suing doctors.

Randy,

True enough, the dual income household was not the only factor (though the extra income amongst college graduate households + smaller families probably had *something* to do with the current US consumption pattern). I acknowledged the importance of other factors in my original statement.

However, I do think that there is a natural limiting factor to the proportion of residential housing on a national economy. Once the amount goes above a certain amount, the high representation of housing in the national economy will be dangerous on the overall political economy.

"I agree. We don’t need anyone in office who made over $20 million suing doctors. "

Oh, even doctors and businesses that have a record of reckless negligence? Even doctors who should have had their license revoked but continue with the complicity of the current insurance scheme and AMA's silence?

(eye roll)

Perhaps you prefer someone who just denies patients coverage through his family HMO company and lies to get cats for his experiments.

(Though to clarify, I don't like multimillion dollar judgments by juries gave awards because they felt sorry for the plaintiff. However, the million dollar judgments are a symptom of a much larger and very broken overall healthcare system, not the cause.)

Astrid,

It is the legal system that is broke. Criminal doctors should be jailed, and the incompetent should have the license revoked. Taking a jackpot from the hospital enriches attorneys, but leaves that much less money for staff and equipment.

Being against millionare doctor suing lawyers does not mean one is for HMO abuse or for the dishonest. That is like saying that anyone who is for gov involvement in the economy is pro-Stalin and for gulags.

Headset,

I don't think much of the jury system either, but I do think the primary blame for the healthcare system lies with insurance companies/HMO/government. Trial lawyers (as opposed to insurance law lawyers) are just mosquitoes in this morass.

"Being against millionare doctor suing lawyers does not mean one is for HMO abuse or for the dishonest. "

Headset. When there's no better alternative to millionaire doctor suing lawyers keep the healthcare system in check, being against the said lawyer is implicitly assenting to HMO/insurance company abuse.

The cat killer statement was just gratuitous abuse on Frist.

FWIW, seems there is an easy cure for what ails to our legal system - mandatory awarding of attorneys fees to the winning party.

I'm also a fan of randomizing jury selection (if only for the streamlining benefits), inmates working for food and shelter, euthanasia and retroactive abortion.

But then I guess that's why engineers generally aren't elected to office.

thanks spike66,

I have some of the Vanguard Total Bond Market Index Fund (VBMFX), which is 35.1% Government Mortgage-Backed. I'm gonna poke around and see if there is a good alternative...

Okay, so I got the governing authority wrong. But that doesn't mean my point: NOT that lawyers are blameless, merely that they don't bear the majority of the blame for US's broken healthcare system. Suggest an alternative to medical malpractice suits for kids with cerebal palsy. It's not the lawyers who award the damages, it's the juries. Demonizing lawyers (many, maybe even majority of whom are rather decent people, belief it or not) doesn't explain how the healthcare system went wrong. Demonizing a man who was skilled at winning for crippled kids and botched surgery victims (that is the other side to your wronged doctors) is not something I'm going ever agree with. There absolutely no indication that John Edwards ever behaved unethically or unprofessionally, or ever even came close.

spike66,

Thanks. Do the same if you ever find yourself in Shanghai (or anywhere in China) or DC.