patrick.net

"Honestly, I had never heard the term Web 2.0 until "

not much to say... its nothing.. not a single real VC is looking at this.

Your better off looking at Software as Services... has more meat to it.

"try using 1989 as your starting part. housing tanked for 10 years"

You better off near 1997-98...
as your starting point.
we had more equiliberium in
the job market and so so economy...

Housing related job loss:

It's not only housing related jobs, Circuit City is laying off 3500 only to hire them back for less pay. This is just the beginning, this will happen with many other jobs, it's another way for a company to create deflation without the job loss.

btw, whoever posted the link to Prof. Lessinger made an interesting call. His theories certainly have merit... although his web page does little to describe what the psychology of the post-Consumerist movement will be. At least, beyond the "Caring Economy". We will help them so we can sell stuff to them. It sounds like an Ike-era slogan. But a feel-good title about "caring" doesn't surprise me coming from a Berkeley guy... :twisted:

Damn, I did it again, here is the link.

You don’t “walk away” from the house if you are underwater. “You just leave the keys on the counter” bullshit.

surfer-x,
This is California, the land of opportunity and non-recourse loans. I am still waiting for the MSM to start doing stories on folks mailing in the "shackles". HELOCs, seconds and refis will be a lot of folks undoing, though...

Non-recourse generally means that if the lender takes over your house, your debt is satisfied and the lender can't go after your other assets, even if the proceeds from the foreclosure sale are less than the debt.

-- Non-recourse loans. If you default on a non-recourse loan, you could be subject to tax on capital gains, but you won't be taxed on the cancellation of debt.
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2005/06/05/BUGG5D3FNS1.DTL&hw=pender+recourse&sn=001&sc=1000

Re: Circuit City lay offs + hiring

Yeah, that is completely twisted. I suspect it's also borderline illegal. "You're fired, but you can come back tomorrow at 75% your old pay."

During layoffs at my own company, I know guys close to retirement who offered to work for free for 2-3 years, in exchange for their retirement benefits at age 65. They were turned down.

Galina Serin is fairly attractive, kind of more wholesome Posh Spice. However, she has a (much) chunkier older sister that indicates where she'll be in 5 to 10 years. Also, anybody who thinks her husband can pull money out his rear end can't be too bright.

Brand - not sure you will find it illegal at all.

many companies since 1985 have fired workers in BA and rehired elsewhere in other states or countries. We dont need you means
we dont need you at your cost. CA is an "At will state"....

Re: Web 2.0. I still don't get the appeal of Youtube or MySpace (on rare occasions when I use them, I find them to be horribly clunky and amateurish), I must be getting hideously old and grouchy.

I'm imagining the housing bubble implosion as an Indian space opera...or maybe a Korean soap opera. Or maybe a Korean soap opera with people in shiny space suits all bursting spontaneously into songs for five episodes.

I went for a few months thinking that there /had/ to be more to "Web 2.0" than "someone finally figured out a proper use for javascript". Guess I was wrong.

WRT laying off people close to retirement, while letting someone go to cut costs is fine, letting someone go because they're approaching retirement would fall in the age discrimination category. Hiring younger replacements, especially after the employees offered to work for free, is just asking for a lawsuit. (IANAL; IJFG'dI.)

DinOR,

Why didn't you give him the zip code for NE Portland.....say around MLK?

many companies since 1985 have fired workers in BA and rehired elsewhere in other states or countries. We dont need you means
we dont need you at your cost. CA is an “At will state”….

That's perfectly legal but remember the guy from India who's contracting company withheld his tax refund. He was a project manager for Target on a L-1 visa making $50,000/year. I have nothing against him, but I find it hard to believe we cannot find project manager for Target locally.

Web 2.0 good.

Web 3.d, yet to be determined.

Randy--Are there real $$$ opportunities in Web 2.0? Otherwise it's WholeSalePetFood.com all over again.

Or perhaps a lot of sharp programmers and smart consultants milking more money from VC and F500's.

at least 10% drop before stabilization: "The severity of the subprime mortgage meltdown has increased our concerns about the outlook for the housing market," wrote Stifel Nicolaus analysts in a report earlier this week.
"Specifically, we are increasingly concerned that the combination of reduced credit availability and increasing foreclosures will put significant downward pressure on what we believe to be an already-unstable housing market," they said. "Indeed, based on our analysis of current levels of excess supply, we believe housing prices need to fall at least 10% before the market can stabilize."

http://www.marketwatch.com/news/story/ryland-group-sees-lower-home/story.aspx?guid=%7BD3796DFF-250B-4DF5-9AAF-424BD43FFA0A%7D

OpinionsPrime: Do you know of any properties that have sold below asking? Or are you really that bad at tracking the market? My realtor and I go over such numbers on a bi-monthly basis. He has many interesting insights on the good deals and the really bad deals that rookies still took at face value.

On NPR's Marketplace today a discussion of how Bill Gross, the Warren Buffet of Bonds predicts we'll see a 20% drop in prices, only less than that if the Fed cuts aggressively.

http://marketplace.publicradio.org/shows/2007/04/05/AM200704051.html

CHRIS FARRELL: I think part of what's going to happen is just a realization. There's still this sense of, 'OK maybe I should cut my price a little bit but I'm gonna try and put it out there and see what happens.' I also think that Bill Gross, he's the legendary bond manager at PIMCO, the Warren Buffett of Bonds, came up with a pretty interesting calculation about how far home prices could fall. If you take 2003, you know the market was reasonably price. I mean, yeah it had been up, but driven by the fundamentals of lower interest rates, demographics, but boy it really went off the Richter Scale, all the speculation in 2004, 2005. So all we're talking about is getting back to the 2003 level. But that suggests, at current interest rates, home prices will fall over some period of time by about 20 percent.

Brand

There is real $ being made in web 2.0. Unlike "our" bubble (us old timers from the late 90s, lol), this time around a good number of the ventures are either already profitable or they have a believable path to profitability. There's still some spectacular BS, like my pet peeve everyone knows about, but there's a lot of very serious plays going on. Stuff around blogs, in particular, is very powerful.

Take this as an anecdote. Recently a well publicized study canvassed young adolescents about internet usage. Something stunning like 70% had MySpace accounts, and almost that many didn't know the difference between MySpace and "The Internet". To them, the Internet is something connected to MySpace. Also, most had never even heard of any of the MySpace competitors (like Face Book or Friendster). When you can grab 70% of any demographic, especially one with disposable income, there's a business model there.

MySpace has mastered branding. You can fault them for anything else, but they have enabled "self expression within a context". Plus they chose early on to be agnostic to various businesses having accounts, which has only increased their social networking capabilities.

I am curious how one penetrates into Web 2.0 with low capital. I have been looking at many bricks and mortar businesses as a source of steady cashflow.

Sir Randall of the Fat Stacks, I agree. Web 2.0 is the way to go, I've bought so much stuff from web 2.0 and google it's crazy.

sarcasm off.

Re: Web 2.0. I still don’t get the appeal of Youtube or MySpace (on rare occasions when I use them, I find them to be horribly clunky and amateurish), I must be getting hideously old and grouchy.

As I have said, Web 2.0 is Gen Y material. You may not get it as a Gen-X-er.

Is this blogging thingie a Web 2.0 artifact as well?

The only way to do that is to go for a long walk on a short pier.

Well, something and tax cannot be avoided, right?

The former supercedes the latter, but not from an economic standpoint...

surfer-x says: fucking haters.
SP says: verb or adjective?

Like, um, dude. Are, um, like, uh, the haters inclusive of, uh, like, um, really hot surfer chicks? Because, uh, like um dude, then me and my buds are totally in favor of verb.

Otherwise, um... like, uh, ya'know, dude. We, uh, vote for, uh, adjective and stuff...

Like, uh, hang loose, um, dudes!!! :)

Probably everyone here has read this already, but just in case, a quote from Dallas Fed President Fisher...

While the subprime damage is largely contained, I do not mean that the market will or should refrain from punishing those who neglect time-proven rules of prudence. Nor am I suggesting that the neglect of prudent practices has not bled into other types of credit - such as the Alt-A market. Indeed, it would be atypical for lax lending standards in one area of credit not to lead to laxity in others. Nor am I placing excessive faith in models that have yet to be tested by real developments.

The subprime situation may well be a blessing in disguise. It reminds us that history does have the capacity to repeat itself. The old financial axioms - levelheaded notions such as "know your customer" (or your counterparty) and "there is a difference between price and value" - remain valid. I expect market discipline to reassert itself, swiftly punishing those who pressed the limits of imprudence or suffered selective amnesia, hopefully doing so in a way that staves off the impulse for lawmakers and regulators to interfere disproportionately.

@ Doug H,

Hey how you been man! Long time no post.

You're probably right, I wasn't exactly sure what eburbed was looking for but I got the impression he wanted some of the more hoity-doity addresses for a "what you get for the money" BA/PDX comparison.

Portland really is "two cities", one on the west side of the river and then there's the east side. Some have speculated that neighborhoods that had traditionally been black are being "bleached" as younger couples that can't afford the "West Hills" etc. seek more reasonably priced alternatives forcing blacks out. In truth PDX is getting too expensive for working families so Gladstone, Milwuakie and Oregon City are becoming "the new S.E Portland". So... let the "poor" f@ckers commute and we'll make the east side as "trendy" and upscale as the west side.

"Poor" being defined as those who refuse to borrow more than they could ever hope to repay.

Busted,

For over a hundred years Stifel Nicolaus has confined their IB activities primarily to the mid-west. With their recent aquisitions of Legg-Mason Capital Markets and Ryan Beck (among others) they are broadening their "foot print". Up until recently it's been hard to explain the concept of a "housing bubble" to people in St. Louis, MO as has been the case with so many of the mid-western firms.

WSJ says Bay Area inventory up over 12% in one month:
http://www.flickr.com/photos/7409273@N03/448269420/

Space Ace,

Uh you got THAT right man! You didn't have to live in CA to see homes go from 200K in '97 to 500K by 2000! Shillers' chart of home values from 1890 to present starts it's "hockey stick" climb in 1997. The reason RE shills make every effort to quietly sweep this under the carpet is purely for "damage control" reasons!

If prices only correct back to 2003 (up TO where Bill Gross makes the case for fundamental support) there's a chance they can salvage the Cartel (TM). DavidLereahWatch did a great job exposing a little known interview where DL sheepishly admits that '97 is the departure point.

WordPress is quite impressive. There are expansion pack for just about everything. You could run a tolerably function (if bare boned) website with just WordPress.

Randy H Says:

> There is real $ being made in web 2.0. Unlike “our”
> bubble (us old timers from the late 90s, lol),

Is most of the money coming from click through ads?

> Take this as an anecdote. Recently a well publicized
> study canvassed young adolescents about internet
> usage. Something stunning like 70% had MySpace

I can’t think of a single adolescent kid that does not have a MySpace account, but I bet if surveyed my friends the number would be about 60% (kids and their friends tell the “cool uncle” a lot of things they don’t tell their parents)…

> Also, most had never even heard of any of the MySpace
> competitors (like Face Book or Friendster).

That is because kids don’t get a Face Book account (and abandon MySpace) until college (if they are Pilipino they will get a Face Book and Friendster account). In the year after college most young analysts check their Face Book page every day, but after two years in the work world most have moved on to LinkedIn (and abandoned their friends on Face Book).

> When you can grab 70% of any demographic, especially
> one with disposable income, there’s a business model there.

I read this BLOG (and others) every day and I’m a member of a lot of social networking sites, but I have never clicked a banner ad (sorry Patrick) and can’t see how the sites make any money from me (or my nephews and their friends that log on to look at posts from friends that include blurry camera photo photos)…

Does anyone else who already bought a home....

get anxiety that you lost $$$$ in the last year on the house? I do...

Free entertainment courtesy of Allah!

Wow, I totally missed out on the "social networking" experience. As far as I know, none of my friends has a MySpace or Friendster page of any consequence.

Good blogs are much more addicting.

There is a person in my family that was working in the mortgage industry for about 5 years. She got preggo & married a guy she worked with. They bought a very average house in a desirable area with $$$ taxes at the height of the market & they were under pressure because she was very pregnant. Her DH is not from LI & is horrified at what they pay to live here. She has never lived anywhere else & her DH tells her she lives in a bubble. She has been complaining that although her DH is a great salesman, lately he can't close any of the deals on his desk because the banks won't write them. She doesn't work since having the baby.
So they just came back from a trip to N.C. & TN.
Low & behold she can't believe what 300k can buy down there. They are thinking of moving.
Problem is there are at least ten homes for sale in their tiny neighborhood, most of them have been listed for 6 months plus. Some of them are much bigger/newer/better but all are listed at 60k-100k less then what she paid & they still aren't selling. Oh and they have an 100% financed IO, and they have started paying down principle yet.

Nothing like real life entertainment, they just keep getting better. Enjoy!

Peter P

Blogging is Web 2.0 (transitional), IMO. There are a lot of things about blogging that are very 2.0 and different than the newsgroup 1.0 phenomenon. Blogging is more adaptive and dynamic. Things like trackbacks, the way blogs aggregate through things like Technorati and Digg, and the emerging blog community add ons like MyBlogLog are more 2.0.

I'd say Gen X are probably about 50% Web2.0 compatible, and Boomers are about 20% Web2.0 compatible.

I think Web 2.0 may be itself just a short lived transition to Web 3.d, which will be more accessible to more people if done right because it will function in easily conceptualized familiar terms and metaphors. The hang ups there are mostly technical, which may make it easier or harder depending upon who you ask.

Space Ace Says:

“The CA median house price has risen 250% since 2000 (tripled in some neighborhoods), while median wages and rents have not even come close to keeping pace.”
_____

Exactly.

So what's the moral of the story?

Well, it's obvious: It's a new economy.

Why work for salaries that aren't keeping pace with the cost of housing, when you can just buy and sell houses that only perpetually increase in value; thereby, living like the proverbial King of Avalon?

And it doesn't take a genius to figure out what you must do. Now go do it!

Ha, ha!