patrick.net

@SactoQT, etc: you're all right, of course.

Too bad, he's a smart guy. As Veritas quoted, people build up foundations of belief that they prefer not to disturb, despite gaping cracks. I'm a bit of a pollyanna (overcorrection for years of being a devout cynic), and I really wish MP would engage the discussion and explain his position, in light of data.

Frames of reference make a big difference. In a two-dimensional world, all spheres appear to be circles. I think this is key. When MP says "housing", he means "housing in SF/the Marina/on my block". Given that, he might even be right -- it's undeniable that the high end hood home prices are more resilient, because the typical owners there can choose to weather downturns. It's also undeniable that someone who makes $500k/yr can afford to spend 90% of their post-tax income on housing, if they want to. Life doesn't cost more just because you make more (obv, most $500k/yr earners don't want to live like $50k/yr earners, but they could, if they wanted to, just with a better view).

But once your scope widens beyond a few popular areas of SF, the world is different. This big world will definitely impinge on those nice hoods at some point, in some way, but perhaps not in the sale prices of properties on the x-hundred block of Sugarplum Lane.

And I promise, that's the last I'll ever say about elective myopia.

so do you agree with the war or not? that statement tells me that you support it. China’s recent move in Petroleum is interesting as well.

I oppose all wars... we should strive to reduce our dependency on oil instead.

New thread: New Bankruptcy law

So you agree with the motives of the war, but not its means. This seems to be the situation. They want the results, but they don’t want to see the ugly side of its execution.

I do not really agree with the motives either... although the motives are perhaps understandable. However, to get more oil, we should probably make friends instead of enemies.

it is certainly possible to reduce oil dependency. im not sure what life would be like without it. life would return to something like the 18th century.

We are dependent on energy. Oil is not an ideal source of energy anyway. It is difficult to switch away from oil quickly because of the large number of machines (namely vehicles) that use it.

Maybe the only way to get more factory jobs in US is to make people broke, so that they will be happy with any job that pays any ammount.

Best way to make people broke is to give them freedom to make POOR choices. Give them as much credit as they want!

I am in the San Francisco chapter as well.

Stanman, what is so bad about people fresh out of college not being able to afford a home?

I think it is a good thing that young people have to save for a few years and learn how to practice financial discipline before buying a home and starting on a family.

Let's say two young people fresh out of college, a nurse and an engineer, start saving at 22. They both make $50k/yr and they are saving 10% of their income. In five years they will each be making about $75k/yr and have $150k saved up. Then they can buy their starter home of $800k with 20% down and comfortably make the PITI of $4.5k ($3k after tax breaks) on their take home pay of $100k or so. Then they can start saving for their retirement. $800k is still a very nice starter home in most of the Bay Area. If you want to live in The City, you are going to have to either sacrifice a bit on size or neighborhood, but you can still live here. You can live well in one of the near in suburbs, like Berkeley or Daly City. You can live very well in an outer suburb like Livermore. And remember this is just your starter home for a couple not even 30 yet!

Sure, this is the cream of the upper middle class here, but if you want to live well in the Bay Area, you have to have two college educated breadwinners.

You can still make it on less, but of course your standard of living will be lower. Two MUNI busdrivers, each making $45k/yr who have saved $90k can afford a tiny starter home in someplace like the Excelsior or something nicer in Oakland or Daly City.

Prices are right at the point where fewer and fewer can afford, especially with a 30 year fixed mortgage. Which is one reason that they cannot keep appreciating at above income rates for much longer.