patrick.net

Both China, India, and the richer area of Taiwan and Hong Kong included, have no welfare system (HK only had a welfare system AFTER the handover). There are no pension system either.

Therefore, my theory is, Asian immigrants are raised on the notion that they have to save enough for their own retirement, because the society cannot offer old-age protection. So Asians tend to save every single penny possible for the rainy day. I know that we are living in America, but me and my wife don't take social security and medicare into consideration at all when we plan our retirement. We look at our own investment portfolio, savings and 401K alone. I believe there are many immigrants who think just like me.

Therefore, a fully paid-off house is seen as a guarantee for old life. I know of a few examples, myself included, who choose to accelerate mortgage payment when we can afford it so that we can be entirely debt-free earlier. The dream of owning a house free and clear, and having a big nest egg in the brokerage account can keep a lot us off the spending spree.

In short, Asian immigrants compete for houses by setting side a much bigger portion of their monthly income for the mortgage payment. As long as the couple can keep their jobs, that's ok. Such a model will break down when the job market turns sour.

What OO and eburbed are saying is true. Yes, there are some people who break from the stereotype (like CB :-) ). But this has also been a factor in BA prices - as much as the funny money. It is important to keep this in mind in order to figure out how the bubble unwinding will proceed.

I like GS350, we are considering it, you can get one for close to invoice but it’s still a large chunk of change.

Get a one-year lease return or something like that. The dealership once told me that someone just traded-in a brand-new car because his wife did not like it. :)

But I don’t care anymore, I am hitting the Lexus dealership tomorrow

Check out the new LS too! :)

OO said :
I maintain that the BA housing bubble won’t pop until the job market breaks down and a lot of double-income families become single-income household.

I don't entirely agree. It is very much possible that the change in lending standards and/or increased mortgage rates will do just fine. Not every house was purchased by 2 income families, nor is every prospective buyer family supported by 2 incomes. BA housing prices need as much funny money as any other to keep it propped up.

With all the stuff I read here (and also on UK RE Blogs) about the school district factor, it seems to me there's a real business opportunity in the education field.

Why hasn't someone set up (franchised?) a private school with academically rigorous education standards but without the high-cost facilities that send fees through the roof? I am thinking of something conceptually akin to the Dissenting Academies in 18th and 19th Century England, who educated a lot of the movers and shakers in the original Industrial Revolution.

Seems to me there would be good demand for such a school in quite a lot of places . . .

We don’t spend on restaurant, vacation, clothes, or entertainment of any kind etc. and frankly if you cook yourself, there is really not much to spend apart from mortgage, gas and utilities. Oh, we usually buy our car with cash and drive it to the ground.

I know. It kills me. One of my Chinese coworkers doesn't turn on the heat in their place. Period. They were down coats indoors. They mooch flakey wifi from their neighbor. They only watch pirated stuff. My $100+ cable bill looks ridiculous in comparison. :(

This attitude really screws the rest of us over by continually raising the bar on housing, and lowering the bar on living.

I guess I should just get used to it - globalization and all that.

Do you folks in NorCal have the Claim Jumper? It’s a lot like the Cheesecake Factory, just (slightly) more upscale and without the cheesecake.

Yes.

I've been to a Claim Jumpers - I'm not sure that it's more upscale than Cheesecake Factory. If anything, I'd say it's downscale. And the portions are even bigger. But I only went once.

Both China, India, and the richer area of Taiwan and Hong Kong included, have no welfare system (HK only had a welfare system AFTER the handover).

Uh... China has no welfare system? They're a Communist (on paper) state.

Hong Kong? They've always had the "Health, Welfare and Food Bureau" - it was simply renamed in 2002. What do you call all the public housing projects there?

Have you looked at the cost of good private schools?

I've heard that Harker is $20k+ a year. Can anyone confirm?

Another point is that there isn’t much culture, class or history in most of Silicon Valley. Cupertino isn’t any worse than virtually all of SV in this respect. In fact, it isn’t any worse than the vast majority of soulless suburbs in the entire country. You can see that I’m not a big fan of suburbia, but it’s a convenient, if unexciting, way to live.

AMEN!

Here's why Steven Levy called Cupertino:

http://www.burbed.com/2007/01/14/what-makes-the-bay-area-special/

I then fly to the metastasized strip mall called Cupertino, Calif., where Apple lives…

FWIW, this guy sort of compared Sunnyvale to London and Rome:

http://www.burbed.com/2007/01/12/925k-for-a-4br25-2094-sqft-house-guess-where/#comment-6056

I threw up a little in my mouth.

But I just don’t buy the idea that they are super-frugal. I’m sure Asians are more likely to be financially responsible than other ethnic groups, but I don’t think it is the norm.

I think there's two factors at play:
1. Are they from Mainland China? Or are they from "LV and Gucci or bust!" Hong Kong?

2. Are they first gen or second gen?

The difference in mentality between 1st and 2nd gen is pretty interesting. I read a study that in Hispanic communities, the support for relaxed immigration standards is significantly lower amongst 2nd gen that 1st gen.

Both China, India, and the richer area of Taiwan and Hong Kong included, have no welfare system (HK only had a welfare system AFTER the handover).

I think Govt workers in India have a pension system. But I could be wrong. Nevertheless living well below your means was socially the most accepted way of living. Instead of suffering from "keeping with the Joneses" syndrome, people used to look down upon spendthrifts.

The neuvo-riche folks of Banglore et al are quite different. Although I doubt any one of them has any credit card debt.

Slightly dated article that discusses the break point for private schools versus public schools in a good district. OO, great rant about the immigrant experience. Amazing how much you can save if you put your mind to it...

"The schools are the biggest reason people move to Piedmont," says Kathie Berg of Marvin Gardens Realty in Berkeley. And wannabe Piedmonters pay handsomely for the move. A 1,200-square-foot house that would sell for half a million in the Oakland hills might cost $700,000-and-up in Piedmont, says Berg. And what do you get for that extra $200K? Lifetime access to public schools that are, to be honest, basically private schools.

"I've done the math," says Berg. She compared the cost of buying a home in Oakland and sending your kids to private school with the cost of buying in Piedmont and relying on its public schools. "If you have one child to send to a private school in Oakland, it was still reasonable," she reports. "But the second you have two children, it absolutely makes sense to buy in Piedmont."

http://www.eastbayexpress.com/Issues/2002-08-21/news/sevendays.html

ajh :

Why hasn’t someone set up (franchised?) a private school with academically rigorous education standards but without the high-cost facilities that send fees through the roof?

Why would you do that ? In BA people are willing to spend money on private schools. Why charge less when they can pay more ? Challenger and Stratford are not upscale like Harker's. But at around 1200 per month, their classes are full. And do you know that in dot com era, people used to literally camp outside these for 2 nights to get their kids admitted ? When someone is so desperate to give you money, don't reject it.

And it is still a mystery why people are willing to pay atrocious prices in Cupertino ?

“I’ve heard that Harker is $20k+ a year. Can anyone confirm?”

Cupertino suddenly starts looking like a bargain…

That's why I rent there.

I’m used to it now, so the shock is gone, but the phrase “metastasized strip mall” brought back that feeling that I had the first time I drove through El Camino Real.

I was too... until I went to Houston.

Then El Camino became dinky to me.

What amazes me is people who live in Mountain View -and- send their kids to private school. Because Mountain View schools are a little dangerous (gang stabbings).

I receive a magazine called Benefit, about philanthropy in the Bay Area. It's actually pretty good, profiles of foundations, private and corporate philanthropy, etc. I assume they pulled my name from a board or something and sent it.

In the issue I received today there is an ad (p. 125) for 960AM The Quake,
"Host Ruby Tourke takes over the airwaves each Sunday morning from 8-9am to interview the people who are at the center of change throughout the Bay Area and who embody and indulge in the lifestyle of giving, from Gavin Newsom, Robin Williams, Harry Denton, the Gettys and more. Sundays 8 am to 9am."
Then there is a photo of her standing there, arms across her chest.

I guess she has a radio show. Maybe she'll get Gavin to embody and indulge in his lifestyle a bit this weekend.

Don't have kids, that'll save you a bundle...

If you feel compelled to share your genes with the world, try egg/sperm donation.

I think astrid has an interesting point. The love for brand names is all too common in India. I remember when I saw a Lacoste tee shirts shop first time in India, my jaw dropped. That much money for a tee shirt ?

While people in India are buying those, I live here in US and the only T shirts / polo I wear are the free ones given by my employers - with some weird project name in big letters on the back.

eburbed Says:

> One of my Chinese coworkers doesn’t turn on the
> heat in their place. Period. They were down coats
> indoors. They mooch flakey wifi from their neighbor.

I was on a trip to NY years ago with a Chinese coworker and when we walked in to a Chinese restaurant I was the only white guy. I commented that “this place must be good since all the people in here are Chinese” He said “when you see a lot of Chinese in any business it will not tell you that the place is any “good” it will just tell you that the place is “cheap”…

Ha Ha Says:
I am also a Cupertino (95014) resident ….

Huh. But are you a renter ? I talk only with renters.

(Just kidding man, just kidding.)

astrid Says:

> By and large I agree with you, I think the thrifty
> Asian pattern has largely broken down. Second
> generation Chinese kids are no more thrifty than
> White or Hispanic kids, and lots of them are in
> fact more spendthrifty because they know their
> (relatively thrifty) parents can bail them out.

I don’t think you can lump all “Asians” together, and while I’ve noticed that say people born in Scotland or China are more often than not thrifty I would say that someone born in Japan is even less like to be thrifty than someone born in France. I have never met a Pilipino (born in the Philippines to 4th generation Americans) that did not love brand names and love to spend money (swing by a Catholic Church with a lot of Pilipino parishioners on any Saturday to see some serious spending since I bet the typical Pilipino family spends more on a wedding that some Chinese immigrants spend over 10 years in the US)…

FAB,

Though honestly, I have the heat way down too. I figure I'm only home a couple hours each day, and I spend most of that time sleeping. Turning up the heat just seems like a total waste of money. The only time I really regret that decision is when I wake up in the morning.

I think living DEBT FREE is a BIG MISTAKE because of FED POLICY of rewarding the debtors. Fed is so powerful so that not playing debt game is gamble you are sure to lose … on top of this mortgage debt is tax free ….

It's not just the debt servicing, but also the principal and taxes that one has to worry about. Even with 0% rate, servicing 1M is not easy. Add 12K for property taxes and it is better not play the debt game. Just find ways of making money on someone else's debt game.

I think astrid has an interesting point. The love for brand names is all too common in India. I remember when I saw a Lacoste tee shirts shop first time in India, my jaw dropped. That much money for a tee shirt ?

But are they legit?

Or is it like the "Gary Klein" shirt I saw once?

But are they legit?

They were priced high, so they must be ! Nah, it was a company owned store. Very legit.

FAB,

While it is dangerous to lump in all East Asians...I think they do share a lot of similarities. China, Japan, Korea and parts of SE Asia share a lot of cultural lineage -- it's kind of like using "European" generically. The Phillipines is almost entirely outside of that "Oriental" Asian zone.

I can say that the Mainland Chinese love luxury brands and prestige items too, while still being completely cheap and irrational on other things. Like people buying 42" Plasma TV + high end stereo equipment, but then watching TV from their 10 year old 20" TV because they don't want to spend money on electricity. And the times I had to visit elderly family friends who refuse to use their AC unit even when it's 100 F! Economic rationalism has yet to sink in.

However, what you see may be a sign of East Asian love for prestige items. My mom knows wealthy Taiwanese women who have BMW/MB SUVs but are too cheap to drive them anywhere (because of gas consumption).

As someone else pointed out, you can't lump all Asians together. Or even all Chinese for that matter.

Taiwanese != Hong Kong != Mainland China.

That said, there's this real shared love of pirated software/video/music. Not like college students who sort of grok that it's not ok. But as in "You'd be foolish not to pirate".

CB Says:
I heard that the Hong Kong housing bubble burst wiped out a lot of families. Perhaps Hong Kong is not in Asia.
Upside down families commit suicide by buring charcoal and closing all the windows, that used to happen a lot after the housing bubble burst.

oh, glorious capitalism. My BIL has just come back from living in HK for 12 years, and says HKites were just insane about chasing anything that looked like it would make money. Every new property release was massively oversubscribed by specuvestors, etc... It's all fun and games until someone loses an eye...

hey, we got 3 posts in tied at 7:34pm! who said patrick.net was dead... ;)

Lacoste is huge in China too, spawning tons of imitation brands & "genuine" Lacoste from Thailand - allegedly from the same factories that produce for Lacoste. There's a Lacoste outlet in Leesburg, VA. I thought about buying something for my cousins, but then suffered massive sticker shock considering the quality of goods offered.

eburbed,

Everybody loves pirated stuff. My mom knows an elderly Taiwanese American woman living in Diamond Bar who claim to get pirated CDs for under a buck each.

oh, glorious capitalism. My BIL has just come back from living in HK for 12 years, and says HKites were just insane about chasing anything that looked like it would make money. Every new property release was massively oversubscribed by specuvestors, etc… It’s all fun and games until someone loses an eye…

The WSJ once had a piece about how some typical political speech words are difficult to translate into chinese. Like... "Stakeholder". Apparently that's really hard.

On the other hand "Hedging our bets" is easily translated because the Chinese have a rich culture of gambling.

But as in “You’d be foolish not to pirate”.

And your objection is .... ? ;-)

I think I break away from the stereotype here. I buy my songs on iTunes. It's not worth pirating when it's less than a buck and you pay for only the songs you like. I think the earlier DVD makers realize that, the better.

For movies, the Indian movies that one can rent from Indian stores are completely pirated and real bad copy. I refuse to watch them because the video sucks. They compress the entire 3 hour movie on a single DVD-R. Terrible. I have a fabulous plasma TV and my eyes cannot tolerate bad picture quality.

On the other hand “Hedging our bets” is easily translated because the Chinese have a rich culture of gambling.

Do they ever. Go to the casino at any time in Sydney, and see who 95% of the patrons are. James Packer of the Packer dynasty (richest guy in the country) just sold a national TV station the relative size of CBS to plough the money into Asian casinos -- and he also already owns major casinos in Oz -- Crown Casino in Melbourne etc. Ditto if you visit that one too. A 20-something kid working in a bank here embezzled about $4M recently and gambled it all away...

Although social policy buzzwords like 'stakeholder' had to be coined and come into vogue in English as well...

astrid,

I always wore alligator shirts when I was little. My aunt bought them for me all the time. I recently found a photo of myself in a white alligator shirt and a pair of khakis, I was about 11 and at summer camp. The really scary thing is I still walk around in white alligator shirts and khakis almost 30 years later. I need a waredrobe update.

Interesting:

Russia probes smelly orange snow
Map of Russia
Russia has flown a team of chemical experts to a Siberian region to find out why smelly, coloured snow has been falling over several towns.

Oily yellow and orange snowflakes fell over an area of more than 1,500sq km (570sq miles) in the Omsk region on Wednesday, Russian officials said.

Chemical tests were under way to determine the cause, they said.

Residents have been advised not to use the snow for household tasks or let animals graze on it.

"So far we cannot explain the snow, which is oily to the touch and has a pronounced rotten smell," said Omsk environmental prosecutor Anton German, quoted by the Russian news agency Itar-Tass on Thursday.

warning: don't eat the orange snow...

But as in “You’d be foolish not to pirate”.

And your objection is …. ? ;-)

Maybe its time to reveal that I used to work on packaged consumer software :(