patrick.net

Vain says

TechG,
Do you mind giving a rough estimate of your budget? I find it hard to believe that money is tight. There must be something quite heavy weighing you down. Student loans? Credit cards? But I guess it is dangerous to rely on two incomes to pay the mortgage it is a smart idea to save some money for a rainy day.

Hmm mainly credit cards, but there are other expenses I hadn't counted on that complicate things. I'm estimating the minimum payments on the credit cards, I don't have the exact figure in from of me, but I rarely pay the minimum payment, unless money it tight that month.

Mortgage $2,730.59
Infiniti Lease $410.00
Comcast Cable $65.00
Water Bill $25
Car Insurance $125.00
Verizon Phone $35.80
Verizon Wireless $55.00
Waste management 96.99 every 3 months $31.33

Total Fixed Costs $3,472.47

Electric Bill $250.00
Auto Fuel (2 cars) $350
Credit Cards Balance Min Payment

American Express $9,000.00 $150
Discover $7,000.00 $100
Visa Citi Cards $2,500.00 $40
John Deere $2,200.00 $60
Geothermal loan $11,000.00 $168

Food $200

Total After tax income about 6.4k a month, but fixed cost eat up more than half of that leaving about 2900 to cover credit cards, grocery, gas, dining out, medical, car repairs, xmas/birthday gifts and other unplanned for expenses. I really didn't count on the Geothermal heating system going so soon after buying a house, that added 15k to my overall debt.

It definitely appears that the Credit Cards are taking a toll on you in the mind. Focus on getting rid of the credit card debts and I'm pretty sure money wouldn't "feel" so tight anymore. But you're pulling through. That's still excellent.

I like to keep my fixed costs low. I drive crappier cars which require little insurance ($18/month). I do not even need to purchase comprehensive or collision coverage for it. Instead of using Comcast cable TV, I just subscribe to Netflix and I can watch tons of movies and shows on demand with no commercials.

The other worrying thing about your finances, is that you're holding a lot of debt. Anything that might impact your job/income could quickly cause problems for you in this scenario.

During your next car "upgrade" phase, I would be like Vain and recommend pulling back that expense. Better mileage car, used and low insurance premiums. You haven't included tax premiums or any housing repair costs in that list either, which I'm guessing you're dumping on credit cards every year.

$200 for food? Are you eating Ramen noodles every day so you can drive a newer car? $2/meal seems fairly tight!

I think I got it all wrong. I must be emotionally tied with my own area too just like many others.

TechG, is your home in suburb little far from the city? A home like that would be way expensive than that if it were in my area. Typical 450K home in my area is, 2000~2500sqft townhouse, or 50yrs old 1700sqft 3/2 on 0.25acre. Utility is relatively cheaper too. I would expect quite more than that in my area.

Your credit card balances look like mine 9 years ago. I managed pay them all off though, it was hard, and that was a part of the reason why I am stucking in crappy rental. Anyway, I recommend you start pay off the card w/ lowest balance first, move on to another, one at a time.

The cable company jacked up the rate right after my promotion period is gone. Cell phone bill will go up too. Yeah, we need new cell phones, and they force us to switch calling plan. This is kind of waste especially when you're not the kind of person who's on TV or phone all the time. And, my old mercury is eating gas up like hungry pig.

It’s 3,500 sq feet living space...
I'm almost afraid to ask; how many people live there?

seaside says

TechG, is your home in suburb little far from the city? A home like that would be way expensive than that if it were in my area. Typical 450K home in my area is, 2000~2500sqft townhouse, or 50yrs old 1700sqft 3/2 on 0.25acre. Utility is relatively cheaper too. I would expect quite more than that in my area.
Your credit card balances look like mine 9 years ago. I managed pay them all off though, it was hard, and that was a part of the reason why I am stucking in crappy rental. Anyway, I recommend you start pay off the card w/ lowest balance first, move on to another, one at a time.

I live about 40 miles from the closest major city (Philadelphia), 450k here will get you a house as big if not bigger than my house, but the lot size will depend on what you looking for. There plenty of McMansions on lots not much bigger than the house is.

As the the Credit Card bills I'm making some progress, I paid off a few cards and hope to pay down/off others in a few years.

As for the commet on my food budget, some these figures are estimates, Generally me and my wife do one major shopping a month for around $200 then I get milk, bread and sometimes lunch meat on as needed bases. Also we have no children to feed, so our food costs are lower and we tend to eat out 2 or 3 times a week. More often then I like, but have to keep the Wife Happy. :)

As for the Infiniti, it's a lease for my wife, I drive a 2003 honda that been paid off since 2005.

This thread gives a gentle reminder of what excessive debt can do to individuals and country. Don't forget that whole bubble was caused by excessive borrowing(I'll pass as to who is to blame for that).

gameisrigged says

Leave it to Larry to completely miss the news that California prices have fallen 3 months in a row. But again, it’s a waste of time to prove anything to you, because you will just deflect with some irrelevant bullshit like you always do. You will claim that our evidence is to be disregarded, and you will find your own “data” that has nothing to do with the subject and try to pass it off as relevant.

Just post the link of 3 months of declines in CA housing prices. As one who is actively looking in CA, I must have missed these declines. But that info surely would be helpful in my search.

I can already hear the gears turning in the duck's brain, trying to figure out how he will dismiss the data out-of-hand and still retain a condescending attitude and feigned air of superiority.

Heck, I'll make it even easier for you. They have a chart right on the front page:

You know, it's funny. When I talk economic metrics with folks, especially those concerning the housing market, the older folks and senior citizens (those who have had their homes 100% paid for quite some time already) never get so defensive/emotional about the value of their property. The younger, indebted individuals/"family men," etc. ALWAYS do, however. Why? IT'S USUALLY ALL THEY'VE GOT, and they're in big debt to boot. THIS IS EXTREMELY STRESSFUL. Give these people a break. Deep down they know this ship is sinking (look at the details of today's job numbers - it's nothing but pathetic all around with the few sectors that were strengthening as a result of unprecedented money pumping now turning over and headed south once again), but when your livelihood and/or ability to sleep at night and remain at least functionally optimistic about the future depends on you believing something or holding a certain paradigm, that's EXACTLY WHAT YOU DO.

schmitz_kris says

Deep down they know this ship is sinking (look at the details of today’s job numbers - it’s nothing but pathetic all around with the few sectors that were strengthening as a result of unprecedented money pumping now turning over and headed south once again

That's funny. Because just yesterday I saw a report saying job openings increased again last month. Guess people who are certain things are going south will continue to believe that no matter what the reports say...

Yesterday? Who are you? The first Friday of the month (whole week) which was TODAY is when the most important jobs report (the NFP) is released by the BLS.

It was terrible and far below industry-wide expectations (1,900% worse than general consensus).

http://www.bloomberg.com/news/2010-10-08/china-stocks-yuan-rise-on-holiday-sales-moody-s-review-copper-advances.html

ADDITIONALLY, jobs loss numbers were revised HIGHER (MORE jobs were lost than initially calculated) for the previous two months.

http://bls.gov/news.release/pdf/empsit.pdf

schmitz_kris says

Yesterday? Who are you

Who am I? Who are you?

It was a different report--one that measures job openings...

tatupu70 says

That’s funny. Because just yesterday I saw a report saying job openings increased again last month. Guess people who are certain things are going south will continue to believe that no matter what the reports say

I would not consider job openings posted as having any meaning. Opening gets posted and get taken down without anyone filling the position. Same posts reappear 3-6 months again. I would only use ADP number as having legit meaning.

Beyond all that we only have some low-200 current public companies in SoBay where we had over 340 public companies in 1994 and over 400 public companies in 2000. We have a long way to go to even consider calling a recovery.

I don't see how prices can dip much again. Today I just saw two all cash deals close in my area. These are not investors.

mlslistings.com

MLS 81044879 listed at $499k, just closed at $550k all cash today.
MLS 81044509 listed at $649k, closed at $640k all cash offer today.

Sure it may be overpriced right now. But until all this money runs out, I don't see how prices will ever go down.

Vain says

until all this money runs out, I don’t see how prices will ever go down.

You just clarified yourself. All cash deals are common but how many of the total % of sales? This foreclosure moratorium is going to hit banks hard, as Patrick pointed out. Cash will be the best option for seller to take and hence lower price. Anybody paying full cash at or above asking price(I should say more than comp price) is just stupid.

bubblesitter says

Vain says

until all this money runs out, I don’t see how prices will ever go down.

You just clarified yourself. All cash deals are common but how many of the total % of sales? This foreclosure moratorium is going to hit banks hard, as Patrick pointed out. Cash will be the best option for seller to take and hence lower price. Anybody paying full cash at or above asking price(I should say more than comp price) is just stupid.

Yeah all cash deals aren't so common. But it just so happens 2 closed today. But every sale has got at least 150k down payment. There is plenty of money out there. I think it's overpriced too. But many are still paying the price so there must be something wrong with my valuation on these properties. These people are paying comp prices, and it has not changed since late 2008. There are less bidding wars from my observation but it doesn't stop that only bidder from bidding as if there was a bidding war.

its beginning to happen

http://www.housingtracker.net/

Here is the data which I trust much more than either dqnews or C-S, because I can verify it myself. This is the data showing asking prices from MLS. If you go to MLS listings, like mlslistings.com, for instance, you can type in the median prices reported by housetracker and see that there is an equal number of houses above and below that price (hence the median). Not only is this data more recent than either dq or C-S, it is not subject to any manipulations by the realtwhore cartel. The data is showing for most US & CA cities, that prices are now below those of Mar, 2009.

PS: This data was also the first to report prices falling back in 2006-2007 when all the realtwhores were parading around, cheerleeding price increases from dqnews & C-S.

And this is one heck of a reality for you Mr. Quack!

schmitz_kris says

Yesterday? Who are you? The first Friday of the month (whole week) which was TODAY is when the most important jobs report (the NFP) is released by the BLS.
It was terrible and far below industry-wide expectations (1,900% worse than general consensus).
http://www.bloomberg.com/news/2010-10-08/china-stocks-yuan-rise-on-holiday-sales-moody-s-review-copper-advances.html
ADDITIONALLY, jobs loss numbers were revised HIGHER (MORE jobs were lost than initially calculated) for the previous two months.
http://bls.gov/news.release/pdf/empsit.pdf

Nice slam! :D

Yes, and another dose of reality for Larry the Duck. It seems as if the news agencies did not consult with Larry, before they published that bad report.

Deal with it Larry, the bottom didn't hit in 2009.

Anybody who says job market is getting better, here is the labor department data.

http://money.cnn.com/2010/10/08/news/economy/september_jobs_report/index.htm?hpt=Sbin

bubble .... not only that, but the government continues to use the highly misleading and overly optimistic U-3 statistics instead of the much more accurate and encompassing U-6 which counts underemployed (part timers that need full time work), people who have lost their benefits, others that have simply lost hope and given up looking for work, etc.

RayAmerica says

bubble …. not only that, but the government continues to use the highly misleading and overly optimistic U-3 statistics instead of the much more accurate and encompassing U-6 which counts underemployed (part timers that need full time work), people who have lost their benefits, others that have simply lost hope and given up looking for work, etc.

Yeah, that underemployed part is always in the back of my mind. This is not real data. A guy who lost his six figure job and working a $13 jobs to get past his bad days is not considered employed by any means.

http://www.boston.com/business/articles/2010/10/07/job_openings_increase_for_second_straight_month/

"Job openings rose in August for the second straight month and layoffs dropped sharply, evidence that the job market is slowly healing."

What?? Obviously they didn't get the message that the world is ending. Would you bears consider job openings to be forward looking? I would say so. And unemployment numbers tend to be backward looking, huh?

Unemployment will improve .... it's just going to take a little bit of time. LOL

http://blogs.investors.com/capitalhill/index.php/home/35-politicsinvesting/2128-us-wont-recover-lost-jobs-until-march-2020-at-current-pace

Tatupu, read the article you posted a link to. The author clearly (and correctly) states that increased job openings numbers have NOT caused any commensurate increase in HIRES, very far from it. It also correctly states that AS JOB OPENING NUMBERS INCREASED SO HAS THE UNEMPLOYMENT RATE.

schmitz_kris says

Tatupu, read the article you posted a link to. The author clearly (and correctly) states that increased job openings numbers have NOT caused any commensurate increase in HIRES, very far from it. It also correctly states that AS JOB OPENING NUMBERS INCREASED SO HAS THE UNEMPLOYMENT RATE.

Yes, but there is obviously a lag between a job opening and a job hire. That's why it's a leading indicator--the hiring will lag by some time period...

Why stop at saying that just housing needs to be so cheap and almost free for everyone? I want to expand this "I want to have everything for cheap or free" passion. Can you believe that a brand new sedan costs over $20,000.00? Who can afford that? It should be less than $5.00, with used cars between $1.00 and $4.00 depending on mileage. We have a huge bubble in auto prices. Restaurant pizza prices are just absurd. A large pie with 3 toppings should not cost more than 5 cents. Pure greed and speculation has made it cost over $10.00. Everybody deserves a free gallon of milk per day, everyday. That is our birthright, and yet greedy grocery stores are charging between $3.00 and $5.00, which is unsustainable. My index of milk prices starting in 1500 A.D shows that gallon milk prices have historically been one thousandth of minimum wage, so it should be less than a cent now. I look at all the idiots buying all these goods at inflated prices and laugh...

schmitz_kris says

You know, it’s funny. When I talk economic metrics with folks, especially those concerning the housing market, the older folks and senior citizens (those who have had their homes 100% paid for quite some time already) never get so defensive/emotional about the value of their property. The younger, indebted individuals/”family men,” etc. ALWAYS do, however. Why? IT’S USUALLY ALL THEY’VE GOT, and they’re in big debt to boot. THIS IS EXTREMELY STRESSFUL. Give these people a break. Deep down they know this ship is sinking (look at the details of today’s job numbers - it’s nothing but pathetic all around with the few sectors that were strengthening as a result of unprecedented money pumping now turning over and headed south once again), but when your livelihood and/or ability to sleep at night and remain at least functionally optimistic about the future depends on you believing something or holding a certain paradigm, that’s EXACTLY WHAT YOU DO.

Caterpillar CAT is +41% YTD, +50% YoY.
If it’s a bubble, I like this one even more than the RE one.
Must be a bunch of idiots and speculators driving up the price.
Hurry, who knows how long Uncle Ben can keep throwing U$D from his helicopter.

kt1652 says

Caterpillar CAT is +41% YTD, +50% YoY.
If it’s a bubble, I like this one even more than the RE one.
Must be a bunch of idiots and speculators driving up the price.

Yes, it must be idiots. Can't have anything to do with the fact that CAT made $1.09/share last quarter, up 91% from a year ago. Sales up 31% And they're up in developing countries, so Uncle Ben isn't really driving it..

tatupu70 says

so Uncle Ben isn’t really driving it..

温家宝 is da man. All this Chinese-owned infrastructure isn't going to build itself. . .

Caterpillar Inc. (CAT - Analyst Report) plans to lay off 2,454 employees across 5 plants in Illinois, Indiana and Georgia to cut costs amid recessionary conditions.

When you cut OPX its normal for net income to raise and stock to go up. CAT had a 10% reduction in force. Of course the stock reacted with higher expectations of earnings in the future. We saw these things happen in prior recessions like back in 1991-92.

Only an increase in Payroll numbers as disclosed from Payroll services like ADP or Ceridan will provide a better guage where we stand on the job front. Advertisements for jobs are meaningless. You have multiple posts for single jobs being posted everywhere.

thomas.wong1986 says

When you cut OPX its normal for net income to raise and stock to go up. CAT had a 10% reduction in force. Of course the stock reacted with higher expectations of earnings in the future. We saw these things happen in prior recessions like back in 1991-92.

What about the top line revenue growth Thomas? How can you explain that away?

thomas.wong1986 says

Caterpillar Inc. (CAT - Analyst Report) plans to lay off 2,454 employees across 5 plants in Illinois, Indiana and Georgia to cut costs amid recessionary conditions.
When you cut OPX its normal for net income to raise and stock to go up. CAT had a 10% reduction in force. Of course the stock reacted with higher expectations of earnings in the future. We saw these things happen in prior recessions like back in 1991-92.

No doubt CAT is, um, right-sizing the places where sales are going ballistic. Don't think the Brazilians are buying Cat products because they are on sale. Perhaps to build something big?

"Caterpillar generates a sizeable portion of its revenues overseas. About thirty percent comes from Latin America and China. The numbers there are ramping up big-time. Latin America increases sales by over 80 percent 2Q YoY. Asia/Pacific was up 45 percent YOY; and the machinery segment was up by 62 percent."

It is too late to jump on this one. But co's like CAT, INTC, IBM, APPL are international companies. They have trimmed fat and sitting on record cash.
Seems shipping and rail traffic is up nicely too.
Consult Dr. Copper and Mr. Alcoa as well.
Just some data points.

clayfire23 says

Why stop at saying that just housing needs to be so cheap and almost free for everyone? I want to expand this “I want to have everything for cheap or free” passion. Can you believe that a brand new sedan costs over $20,000.00? Who can afford that? It should be less than $5.00, with used cars between $1.00 and $4.00 depending on mileage. We have a huge bubble in auto prices. Restaurant pizza prices are just absurd. A large pie with 3 toppings should not cost more than 5 cents. Pure greed and speculation has made it cost over $10.00. Everybody deserves a free gallon of milk per day, everyday. That is our birthright, and yet greedy grocery stores are charging between $3.00 and $5.00, which is unsustainable. My index of milk prices starting in 1500 A.D shows that gallon milk prices have historically been one thousandth of minimum wage, so it should be less than a cent now. I look at all the idiots buying all these goods at inflated prices and laugh…

You know, I used to wonder how people could have been so shortsighted as to overpay for houses as much as they did at the peak of the bubble. But sadly, I now realize that clayfire23's post is pretty typical of the extent of the public's understanding of the housing market. That is to say, no understanding at all.