patrick.net

Scrap social security and use the money for universal health care. How about that?

you don’t spend all day trying to think of ways of knocking back claims, you suddenly become *twice* as efficient as you get on with the core business of delivering healthcare

We still need a mechanism to knock back unnecessary medical procedures.

I really won't say the people in fortress are mostly rich Asians, I have met plenty of not-so-rich-oh-so-in-debt Asians, particularly in Palo Alto, because it is such a mecca for Asians with its reputation spreading far and near in India, China, Singapore, Hong Kong etc., some Asians see it their lifetime goal to own a piece of Palo Alto. What if you cannot really afford it? Borrow it. Living in Palo Alto being a "neighbor" to Steve Jobs is a huge bragging right.

South Palo Alto is full of people like that. I know of a guy who took on $1.2M loan to get into an Eichler home. If you are rich, you won't take on any mortgage loan beyond $1M because beyond that magic number you lose mortgage interest tax deduction. People who borrowed $1.2M really need that amount of money. Think about how fragile that family's financial situation is? What if 2 incomes become 1 income, even briefly?

On top of this, Asia is deeply affected by our recession, when American consumers poop out, who is going to buy their exports? I really won't count on fortresses being immune, although I think the key determinant for fortress to crack a big way is the job market, which is quite ok for these worker bees.

When Google starts to lay off 10% of its full-time workforce, fortress will easily lose 30% of its value.

If we scrap social security, that will take care of the Medicare problem in about 2-3 years.

Nothing against Facebook, but where does the dough come from? In a more polite term, what is their biz model and how do they expect to be cash flow positive just based on operations?

Any companies that are not cash flow positive will be wiped out in a year, because no VC (VC cannot close fund raising rounds) will have enough resources to pour money into a black hole. I personally think LinkedIn will do much better, because now that job market has gotten tough, I see TONS, TONS of activities from acquaintances on LinkedIN, and they are definitely willing to pay for service if that is how they can access their job leads from friends and ex-colleagues. LinkedIn has reached the critical mass for pricing power.

What do I need Facebook for? None of my friends or colleagues are on Facebook for constant maintenance, the active users of Facebook are either in college or graduated without a job (trend of 2009). Very soon, because of the education loan crisis and credit crunch, many small private colleges will be closing down, and students cannot get loans for their college education. The Facebook target customers are so dead.

If we scrap social security, that will take care of the Medicare problem in about 2-3 years.

Very well. Soon, we will realize that retirement is unnatural and extending welfare to retirees is against Nature. We will learn this lesson hard.

RE: Facebook

I have small-business-owner friends who love Facebook. It is a good social-networking tool.

Medicare and SS are the biggest Ponzi schemes in the world. Worse still, this is the ONLY country in the world where ONLY the elderly get such lavish treatment on the dime of everyone else.

Because of Medicare and SS, lots of Americans falsely believe that their retirement are taken care of and squander to no ends while they are young, and rely completely on the rest of us to fund their retirement and lengthen their life span. Well, there won't be enough of "us" around to support these people because of a simple fact - population structure.

Self-funded retirement is admirable, and that should be the goal of everyone. I am ok with providing elderly with food so that they don't starve to death, but it is disgusting that we are giving an 85-year old cancer treatment

but it is disgusting that we are giving an 85-year old cancer treatment on taxpayers' money, while many younger people are without medical insurance or on insufficient medical insurance coverage.

I agree!!!

It is an upside-down ponzi scheme. Life past 70 is a luxury and medical care for elderly should not be free. In fact, we should slap a luxury tax on them.

Self-funded retirement is admirable, and that should be the goal of everyone.

Again, I agree.

I am ok with providing elderly with food so that they don’t starve to death, but it is disgusting that we are giving an 85-year old cancer treatment

We should feed the children before we feed the elderly.

I propose tying voting power to your marginal tax rate. If your tax bracket is 30%, you should have twice as much vote as someone who pays 15%.

People who do not pay income tax should NOT be allowed to vote.

Good heavens

Peter P Says:
Scrap social security and use the money for universal health care. How about that?

ah, in Oz and the UK they somehow manage to have unemployment benefits that never terminate, and aged pensions, and baby bonuses, and low cost university education, and free universal health care, all off a tax base similar to the US. And right now have $40bn in the bank on a tax basis of 10 million taxpayers. Must be magic.

Peter P Says:

We still need a mechanism to knock back unnecessary medical procedures.

That happens somewhat due to waiting lists and restrictions on funding for elective surgery, etc.

Is there no end to the insults? The general consensus at Merrill Lynch this past week is that most received bonuses comparable to last year. That's our f-ing tax dollars rewarding people for a performance that they should all be fired for!!!

This shit has gotta stop.

Peter P,

Perhaps tie voting to land owners like the old days! Maybe that could help move some inventory.

Paul

How about if we vote in the same manner that stockholders vote - by number of shares. Only we base it on income tax payment. So your votes are weighted by your latest or recent income tax payments. Those who pay no tax get no vote, and those who pay the bulk of the tax bill get the bulk of the say.

Peter P says: "Very well. Soon, we will realize that retirement is unnatural and extending welfare to retirees is against Nature. We will learn this lesson hard."

The really hard lesson will be when you reach old and feable age and cannot support yourself, and get no retirement under your proposed system.

Essentially you advocate starving the old out - even though they have previously been productive citizens. Such a harsh society would, no doubt, kill all non-productive adult citizens. No welfare needed - just kill the leaches to save money. Certainly the never productive are less deserving than the previously productive!

At the other end of the spectrum is the environment we have actually been migrating toward, where we subsidize uselessness by taxing the productive people and giving it to people who produce nothing (except more welfare recipients). This reminds me of the Americans with No Abilities Act, a law intended to protect the millions of Americans who lack any real skills or ambition:

http://www.theonion.com/content/node/28982

enjoy.

I liked this, many many thanks Zephyr :-)

Congress Passes Americans With No Abilities Act
June 24, 1998 | Issue 33•24

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Lewinsky Subpoenaed To Re-Blow Clinton On Senate Floor

WASHINGTON, DC—On Tuesday, Congress approved the Americans With No Abilities Act, sweeping new legislation that provides benefits and protection for more than 135 million talentless Americans.

The act, signed into law by President Clinton shortly after its passage, is being hailed as a major victory for the millions upon millions of U.S. citizens who lack any real skills or uses.

Zephyr, we may have the worst of both worlds. :)

The unproductive will still be rewarded and we will still get nothing when we retire.

How about if we vote in the same manner that stockholders vote - by number of shares.

Already proposed! :)

http://patrick.net/wp/?p=336#comment-140700

Already proposed!?? Great! Sorry I missed that. So, lets vote on it. But, do we count he votes based on the new or old system?

"...we may have the worst of both worlds. The unproductive will still be rewarded and we will still get nothing when we retire."

Perhaps the reason we will have nothing when we retire is because the unproductive are rewarded.

Addition by subtraction. Subtracting a liability is as good as adding an asset. Doing both is a homerun.

So, stop subsidizing the never productive, and put them to work.

Perhaps the reason we will have nothing when we retire is because the unproductive are rewarded.

I have to agree. :(

If convicted felons are not allowed to vote, why should career welfare receipients be allowed to? Many felons have at least been productive before! I am all for a social safety net but people should not be allowed to rely on welfare indefinitely.

Case Shiller is out.

SFO (Bay Area) is now at 139.44.
Down 4.18% MoM
Down 30.98% YoY
Down 36.15% fro Peak in May 2006

Using 2% MoM declines we reach equilibrium now in April/May of 2009 - but that is relativeto retracing the bubble using an anual BA historic appreciation of 4.25%.
At this point I feel normal appreciation is off the table. Inflation is now negative and recession with job-loss and jumbo mortgage unaffordability will drive the market below the pre-bubble historic norms. I feel we can easily see Nominal 2000 pricing by early 2010. In theory, the market will simply stall there for a while but this is heavily dependant on how the economy is managed.
With the rate debt is being added to the US, there is a chance of whipsaw inflaton that the Fed would need to drive rates through the roof to correct. That will have the effect f really depressing housing.
So, I see early 2010 as a time to get a low rate, fairly low cost house. Then some time starting near mid 2011 housing will start another downward correction due to rising mortgage rates. Those with cash in 2012 will not care about the high rates and can get homes cheaper than 2010.
Of course there is a TON of economic intervention coming between now nd then. . .

Citi/Chase just informed me that they are closing one of my unused-for-24-months credit card accounts.

Talk about closing the barn doors after the cows are gone. Or closing the wrong barn door in this case.

Talk about closing the barn doors after the cows are gone. Or closing the wrong barn door in this case.

Actually, that might be a cost cutting measure. After all, why should Citi pay the cost of keeping revolving credit lines open for people too smart to use them?

Speaking of housing, did anyone notice that the tax code for 2008 allows one to deduct house property tax, even when one does not itemize? That is a boon for people with paid-for or nearly paid-for houses. Paid-for homes obviously generate no interest deduction, which makes the owners unlikely to have enough other deductions to make itemizing worthwhile. But now the "true" homeowners can take the standard deduction as well as deducting property tax. Is the tax code now encouraging housing thrift? Is someone going to catch hell from the bank lobby for letting this item slip in? I like it!

HeadSet,

Actually, that might be a cost cutting measure. After all, why should Citi pay the cost of keeping revolving credit lines open for people too smart to use them?

I think they will spend more money on postage and paper for trying to get me to sign up again than they do keeping a few bytes of account in their computer.

But seriously, the bank is probably grouping me in with the crowd that is (or they think is) just about ready to max out all their old cards as a last gasp before going bankrupt.

HeadSet,

One can elect not to itemize, except that particular ONE item. Very strange.

A shrivel of integrity left for what's remaining in the system?

http://news.ino.com/headlines/?newsid=68956898476790

Well, Saturn just turned retrograde.

At some companies, the furloughs are a prelude to a permanent layoff.

Trinh Nguyen, 23, was called into a conference room with four other workers in late December at the 50-person Baltimore architecture and design firm where he works. The group was told that they were on a 30-day furlough, starting Dec. 10. "They tried to lighten (it) up as not a termination," said Nguyen, who asked that the company not be named.

As he sees it, most of his co-workers will spend the time hunting for new work. Those who succeed won't qualify for severance payments they would have gotten had they been laid off. That would make the furloughs a way for the company to save money both on paychecks and severance — if workers can find other jobs.

"It's just a harsh situation," he said.

SAN FRANCISCO (MarketWatch) -- Speculation has surfaced that Microsoft Corp. might have to move beyond its current hiring slowdown and even cut jobs, as Wall Street analysts pare their outlook for the company amid the economic gloom.
Rumors of layoffs at Microsoft (MSFT:Microsoft Corporation
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Last: 19.34+0.38+2.00%

4:00pm 12/30/2008

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MSFT 19.34, +0.38, +2.0%) emerged last week on a Web site published by an anonymous, self-described employee who writes as "Mini-Microsoft." A number of comments from posters describing themselves as fellow employees pegged mid-January as a timeframe for as much as 10% of Microsoft's roughly 95,000 jobs to be cut.

A more recent post on the Mini-Microsoft site Monday featured comments dispelling the layoff rumor, suggesting that the company may instead simply implement a broad reorganization and possibly scale back plans for new products.

Skaters Jump In as Foreclosures Drain the Pool

On a recent morning, a 27-year-old skateboarder who goes by the name Josh Peacock peered into a swimming pool in Fresno, Calif., emptied by his own hands — and the foreclosure crisis — and flashed a smile as wide as a half-pipe.

“We have more pools than we know what to do with,” said Mr. Peacock, who lives in Fresno, the Central Valley city where thousands of homes, many with pools behind them, are in foreclosure. “I can’t even keep track of them all anymore.”

.....
.....

Some skateboarders use realty tracking sites like realquest.com and realtor.com to find foreclosed houses with pools, while others trawl through satellite images from Google Earth.

On the Web site skateandannoy.com, where skaters trade tips about how to find and drain abandoned pools, one poster wrote about the current economic malaise. “God bless Greenspan,” the post read, “patron saint of pool skatin’.”

At current price of about $40/b every producer in the world is in trouble.

Tar sands included. (To be precise, current tar sands production of about 3mb/day is OK but only slightly profitable at $40/b. What's in trouble is the new investment money (about $30B) committed into new production and planned to come online starting 2010. About half of this money won't make sense anymore.)

While producing more oil is extremely difficult, producing less is a cinch. OPEC is turning off the tab by 3mb/d by Jan 1 2009, and likely to cut another 3mb/d by March. With this much cut, price will rise again for sure. Most OPEC producer countries need $60-70/b price in order not to go into national deficit, so one can safely assume they will just keep cutting productions until price reaches at least $80-90/b. They'd love to stabilize it as $100/b.

This is why Alberta is just sitting tight, knowing the low price will last only half a year. And you know what, Alberta needs a cooling period anyway. Boom of recent years create too much economic nonsense which need to be flushed out.

http://www.h1b.info/about.php

PermaRenter Says:
At some companies, the furloughs are a prelude to a permanent layoff.

Are there any companies that are considering a shorter work week with a pay-cut, as an alternative to layoffs?

I would _love_ to cut back work 4 days a week even if it meant a 20% pay cut...

I meant "cut back work TO 4 days a week"

I would _love_ to cut back work 4 days a week even if it meant a 20% pay cut…

Many may get this wish. Only you may not just see the 20% cut for the loss of one day, but a per day pay cut as well.

As a alternative to layoffs, I believe we will see:

Reduced work week
Cut in hourly pay
Mandatory annual 2 week unpaid vacations
A return to "vested" pensions. That is, you put away some of today's salary (with a possible employee match). This accumulated money, not future corporate earinings, is what pays your retirement.

Mandated vacations are fine.

Any change in pay structure is a big warning sign. Cut your loss short and exit early.

I am against any kind of pension.