June 26, 2007

Do you know the housing canary in a coal mine?



You know, someone who bought at the peak, in 2005 through this year, as a "can't miss" investment, or someone who owns a collection of negative-cash-flow properties, or someone who is urging you now to either not sell, or maybe even partner with him on some deals?

Someone whose home is filled with "Make Money Flipping Houses" books, and who watches "Flip This House" religiously? Or someone who got their real estate license in the past few years?

Or the worst one, someone in their twenties whose last real job was working at Best Buy who didn't go to college and who runs around town blabbing that he or she is a "real estate investor"?

In other words, and more importantly, do you know the guy who at the very bottom of the housing crash cycle (in 2010 or 2015 or whenever that is) will throw in the towel in disgust and capitulation (at which point HP'ers will know it's safe to buy again).

102 comments:

Anonymous said...

The canary is Wall St. It created financing it can't backup. When it revalues it's portfolio (CDOs), the liquidity will dry up and soon thereafter the mortgage market. A return to the 20% down payment days will whack affordability metrics in half or more. That will bankrupt a lot of families and many banks.

Agent #777 said...

Hey Keith - here's one:

In October 2006 I was chatting online with another licensed agent (who is a Broker) about a deal he has just closed. He "helped" his client get a new model home for 928k with all the furnishings. He says it appraised for 990k for “just the house”. I asked how his “investor” had paid for this. He said he paid 90k down, and would be paying about 6k a month. But this is OK, because the Builder is going to rent it back from him for 2 years to continue showing the Subdivision - for $4500/month!!

The financial genius says:
"they will give him 4500/month as a lease pmt - he has to come up with about 1500 himself…so not bad, 1500 a month to control a million dollar fancy home."

Now, lets fast forward to the current month.

House sold for 928k, 10/06:
Just over 3000 THS, 4300 total, pool, patio, BBQ grill - assessed at 616K

Since that time, ONE other house has closed in the sub (maybe 10 of the 40-60 lots have been built).

This House sold for **770k**, closed in 03/07:
Just over 3350 THS, 4570 total, pool, patio, BBQ grill - assessed at 659K

And yet last Monday, the Orlando paper publishes a story about how the luxury home segment is still going strong. I guess the MSM definition of strong is different than mine.

Anonymous said...

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Anonymous said...

An Acquintance at work who is extrememly risk averse and lacks motivation in general decided it was time to get her realtors license. I knew then that we were nearing the end....

This was copled by the fact that several friends decided to start investing in real estate in Florida, Texas, Arizona, Kentucky and other areas that they personally know nothing about (Living in L.A.). Once they started bidding up property accross the nation, it was obvious this was no ordinary frenzy, the canary had dropped dead.

Anonymous said...

Fall of 2005,
One day one of my spanish employee came and told me that she was buying a 600k house in the bay area. I was only paying her about $10/hr. I told her that I don't recommend it, but if she went through with it I would pray for her. On that day, I knew that the R.E. PONZI scheme was over. She was my housing canary and as they say.... the rest is history.

Anonymous said...

I watch flip this house to laugh at the imbeciles trying to flip. then I get a bigger laugh when they actually greater fools who pay asking price for a house with a shabby rehab job.

Anonymous said...

I just found out my neighbor (metro boston area) who was one of those people who became a realtor within the past 10 years, is going bankrupt.

Goodbye lexus, sport utility vehicle, and ostentatious house, hello rental...

tsk tsk...

Anonymous said...

Keith,

No offense but it would be easier to determine who -wasn't- a "canary"! Even in small town Oregon I'm literally surrounded by greater fools, momentum players and yes, housing day traders.

And why not! Afterall it's worked perfectly well for them for at least the last five years?!

Now that our rinky dinky local market has cooled considerably there is a rush (as I have long predicted) toward lesser priced homes below the median in a last desperate attempt to bottom feed!

The ugly reality is that I just so happen to rent one of the NINE condos here in town! In an effort to not have yet another bubble sitting residence sold out from under me by a weak handed investor I thought I'd place a lowball offer on the table. It was accepted. Since then numerous other competing bids have cropped up (primarily from realtors) and all of a sudden my appraisal is taking too long and I'm being hit with a string of ultimatums and outright threats!

I'm hardly surprised and as far back as Feb. of this year my wife and I discussed this very possibilty. Given the maturity level of some of the parties involved I would have been amazed had it turned out any differently!

This is very similar to 04/05 when builders were declaring a new home "substantially complete" in order to back out of a previous agreement in the pursuit of greater profits. I am in hell.

DinOR

Anonymous said...

I know some "flippers" in Philly and the NJ Shore

Made some fast money for a while and reinvested into more housing.

Can not sell so they are renting. Renting covers about 75% of the costs.

When I ask them if they like "subsidizing" other people lifestyles - I get a blank stare. They are build equity until the market turns around...

Marky Mark

Anonymous said...

Can't forget the song...

http://www.youtube.com/watch?v=MIIuu76pL54

Batman said...

How about this canary in a GOLD mine: whenever Keith posts about gold, sell like fucking crazy because you have about a day before gold sheds about 20 bucks.

That's some voodoo curse you got there.

turdly said...

I had a short discussion with a turd on Saturday. This guy is a human mule, he pulls wires for a living. Doesn't dwell them out, doesn't connect them, doesn't throw the power switch, HE PULLS WIRES. Most untalented job in the world. Even a shovel requires some finess and a little knowledge of gravity and soil composition. He tells me [unsolicitedly] he has two houses being built in Tucson. I make a miniscule attempt to educate him and he tells me; I paid 325k for them, and when they're done the appraiser says they are valued at 430k. I patirntly asked him how the appraiser/$350 whore, would know the value 5 months from now when they are finished and he tells me 'it doesn't matter. I didn't put anything down, I'll just walk away.'
Earlier this year I got a panic call from this guy because they repo'd his truck and he needed to hock his boat to me. I wouldn't hock it for more than 30% of value because I knew he wasn't good for it, so I towed it to a vacant lot where he put a sign on it. He proceeded to tell me the next week how he got DOUBLE retail for his only adequate boat. I speak to him as infrequently as possible. I want to know who let this human flotsum invest in two houses? I hope the builder gets both houses rammed up his butt. This guy can't afford Ramen let alone the out of pocket for the apraisals, let alone even the first monthly payment. I hate that. I hate that I make 40 times what this guy does and I wouldn't do the investment.

I used to have a shirt that said
'Hey stupid, it's not an ATM it's a house'. I'm having a new one made that says 'insiders out, turds rush in'.

Anonymous said...

You guys are so dramatic.

Prices are crashing. So what?

Still MILLIONS of home sales. Millions of closings. Millions of dollars being made.

Yea some people are totally fucking themselves, but that is nothing new.

turdly said...

One more;
The worlds best processor, who broke me into the CORRECT way to submit a loan, went on a drinking binge one night and got knocked up by a Mexican gardener. He's legal as second generation but his parents were not. She puts him in a friendly loan shop to have him trained as an l/o.
Fast foward four years and I get a call from the guy saying how well he's doing and that he owns 5 houses in Phoenix that he has never seen, and he's never been to AZ! He's lost his ass needless to say.

Ok, one more;
I got a call three months ago from the owner of a semi large motgage company, maybe 300 employees. He personally nets about 2mill a year from what I figure. He calls me wanting to know how to get his 10% down back on a home that is being built in Phoenix. I ask him how much, he tells me 35k. I tell him suck it up and walk away if you can. He tells me he wishes it was that easy, it's on 15 houses! I told him 'I'm out' and to write to Twist at HousingDoom. I don't know the outcome but I'm guessing he walked away from the 500k+-....

SPECTRE of Deflation said...

I didn't see a canary, but there is a moron in the White House. Today he called it Amnesty. He's nothing but a lying POS elitist::

WASHINGTON (AP) - In every emphatic way, President Bush has declared repeatedly that his immigration bill does not offer amnesty.
And then, on Tuesday, he said it did.

"You know, I've heard all the rhetoric—you've heard it, too—about how this is amnesty," Bush told advocates of his immigration overhaul. "Amnesty means that you've got to pay a price for having been here illegally, and this bill does that."

Anonymous said...

as usual, i must say... but its not worth 169,000

buyerwillepb said...

Kieth,

You forgot to ask,

"Do you know anyone who committed mortgage fraud (or 2, or 3) who now keep an eye over their shoulder for the Feds to come knocking on their door?"

FLIP said...

Guy i know, mid twenties like myself, dropped out of school his sophmore year to do Real Estate.

Now he's a butcher at a local grocery store, while i finished my degree.

The Best Buy comment rings so true.

Anonymous said...

I think real estate market is quite local. I am in bay area, east bay not as crazy as south bay. For houses in good school district, it's still hot. I do see the softening of low end market, which is for first time home buyer, but for the higher end market, e.g. 800k and up, you still have to bid to get a good place. Lots of my friend bought there house before the booming, now they are planning to cash the profit ( often 200-500 k ) and buy a bigger home.
The good school district is so limited and no where to expand. I think this means supply side can't increase. There are SOOOO many people with 100k to 200 k annul income, 50 k to 100 k cash in bank in this area waiting for the house, so the demand side is still strong.

House market is not like something else, if German car is way too expensive, I can get a Japanese car, or even a Chinese car ( Keith, don't kill me ).So the price of car can't really go up. But if I can't afford a house in bay area, I can't buy one in AZ because the house price is cheaper there unless I move. If I can't afford a house in good school district or good neighborhood in bay area, I don't want to buy one in a lousy school district or a dangerous neighborhood.

Supply of good house in bay area is limited, that's my judgement and I can't imagine the house price will crash in my area although I really really hope so.

Anonymous said...

Just came back from an auction down the street and I have to say it makes no sense.

Home was foreclosed with a mortgage of $461,000 in November. Final winning price today? $647,000. HUH?? WTF?? QUE?

This house needs at least $75K worth of work. It is on a 3/4 acre lot, 3600 sq ft and nice solid looking home; the $75K is needed for updating bathrooms, kitchen, floors, etc.

There is a brand new 3200 sq ft home, on .92 acres for sale across the street for $749K. It has been for sale for coming up on 5 months now and originally listed for $789K. And yet this doofus paid $647K for a 45 year old home that needs $75K worth of work and on a smaller lot.

I'm tellin' ya there are a lot of fools left out there and we are nowhere near a bottom.

What was funny though were all the neighbors who came by. Must have been 200+people at the auction. And you could see the looks on their faces thinking, are these bidders fucking insane? They know that home is worth $550K tops and the Casey Serin lookalike just got royally taken.

Anonymous said...

I know that guy.Scott Lushing.A mortgage broker with all his money in poor housing investments.He got his few sleazy scumbag friends that he has and wrote crappy arms loans to the unsuspecting.I love the way this is playing out!

Anonymous said...

New U.S. home sales slide in May
Further evidence of a continued slump in real estate
Updated: 11:03 a.m. ET June 26, 2007

http://www.msnbc.msn.com/id/19436003/

WASHINGTON - Sales of new homes fell in May for the fourth time in the past five months, providing further evidence of a continued slump in housing.

The Commerce Department reported Tuesday that sales of new single-family homes dropped by 1.6 percent last month to a seasonally adjusted annual rate of 915,000 units. That followed a 12.5 percent surge in April sales, which was the biggest one-month jump in more than a decade.

But the April increase, which analysts believe was heavily influenced by special factors such as the weather, marked the only strength this year. In every other month, sales have fallen as builders struggle to deal with the most serious downturn in housing in 16 years.

Story continues below ↓
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The median price of a new home sold in April was $236,100, down 0.9 percent from the price a year ago. The median is the midpoint where half the homes sold for more and half for less.

The slump in sales affected most parts of the country. Sales were down 7.3 percent in the South, where half of new homes are sold, and fell an even larger 11 percent in the Northeast. Sales were also off in the West by 1.9 percent. The only region of the country that saw an increase was the Midwest, where sales jumped by 30.8 percent.

Home prices are expected to fall further in coming months as builders slash prices more to trim a glut of unsold homes in the face of deepening troubles in housing. The National Association of Home Builders reported last week that builder confidence has fallen to the lowest level in 16 years.

The troubles in housing follow a prolonged boom in which sales of both new and existing homes set records for five consecutive years. That ended in 2006 as investors, who had been lured into the market by soaring home prices, began to retreat in the face of rising mortgage rates and slumping prices, especially in the once red-hot markets.

Adding to the problems are spreading problems in mortgage lending, reflected by rising foreclosure rates as borrowers are unable to meet payments on adjustable rate loans which are now resetting at higher rates.

The inventory of unsold homes did drop by 1.1 percent May to 536,000 units but because the sales pace slowed, the length of time it would take to deplete inventories actually rose to 7.1 months, up from 7.0 months in April.

Anonymous said...

I think 2010 will be the very earliest that real estate will bottom. By my charts it could be 2015, but by the Japanese example try 2022 just to level off!

Anonymous said...

This one will be worse than the Great Depression. Why? In the 30's we still built things, and today all we have are idiot politicans, lawyers and arrogance! The dollar is funny money, and it will be on pare with the rupi. These young punks will fold like a house of cards.

Anonymous said...

I know a guy who bought a crappy small 2nd home i a large city that no one thinks has a bubble. sat on the market for 6 + mo. He is now renting it at a $500/month loss! Coudl you imagine a stock that cost you $500 a month?? Would n't you just get rid of it???? From can't lose to can't get out!

What Canary? The crash is on! said...

According to Lombard Street Research, it's a credit crunch. From the U.K. Telegraph (hat tip, Action Economics):

The United States faces a severe credit crunch as mounting losses on risky forms of debt catch up with the banks and force them to curb lending and call in existing loans, according to a report by Lombard Street Research.

The group said the fast-moving crisis at two Bear Stearns hedge funds had exposed the underlying rot in the US sub-prime mortgage market, and the vast nexus of collateralised debt obligations known as CDOs.

"Excess liquidity in the global system will be slashed," it said. "Banks' capital is about to be decimated, which will require calling in a swathe of loans. This is going to aggravate the US hard landing."...

Lombard Street’s warning comes as fresh data from the US National Association of Realtors shows that the glut of unsold homes reached a record of 8.9 months supply in May. Sales of existing homes slid to an annual rate of 5.99m.

The median price fell for the 10th month in a row to $223,700, down almost 14pc from its peak in April 2006. This is the steepest drop since the 1930s.

The Mortgage Lender Implode-Meter that tracks the US housing markets claims that 86 major lenders have gone bankrupt or shut their doors since the crash began.

The latest are Aegis Lending, Oak Street Mortgage and The Mortgage Warehouse.

Anonymous said...

Keith,

I see you have totally forgotten about or have on purpose quit making entires about Iran as pertaining to their nuclear program. Ahmadnejad and Bush played you and the rest of America like the suckers you are. Creating all of that tension and impending fear of war kept oil prices hovering around $65 when in reality nothing but speculation caused this.

Bush and Mr. A are laughing all of the way to the bank while the little people (everyone else) is busy beating a war drum and taking up sides. Forget Al Capone or Tony Soprano.....Bush and Ahmadinejad are REAL Gangsters.

Anonymous said...

from Forbes...no really. Now were getting somewhere. Imagine going against age old wisdom.

http://tinyurl.com/226o8w

Anonymous said...

Atention 7:39, attention 7:39....your tin foil hat is ready for pick-up at window 4.

Thank you.

kitchenstove said...

I don't think there's a definitive canary yet, but everyone will know it when they see it. Maybe when Casey or someone like him goes on Oprah to tell their sob story, we'll know we're near the end. Keep watching Oprah, lol.

Anonymous said...

Mr. Greed meets Mr. Fear when loan losses and defaults start to kick Mr. Greed in the nuts over and over and over and over again. By my estimation, the first two kicks have been delivered and Mr. Greed is just starting to wake up to the realization that it hurts to be kicked in the nuts. He's getting that sick feeling in the pit of his stomach and the foot is rearing back to deliver kick three of what will be many Bruce Lee kung fu style kicks. Some of those kicks will be light and some will be crushing but there are more to come and Mr. Greed is starting to figure out that he's in for far more than he bargained for at the onset. Mr. Greed's nuts are the canaries in the coal mine.

Anonymous said...

Dumbest idiot quote of the year!!!

Anonymous said...
This one will be worse than the Great Depression.

Must be a Bill Mahr clone or a bitter European jit bag.

Hpy babybmr Glndle AZ said...

Phoenix:

I sold one of my rental properties in March 2007 to an Hispanic cook at the Biltmore.

268,000.00

I paid 86,000.00 in 2002.

I put mucho dinero in my pocket.

I drove by the property Saturday 3 weeks ago. There were 6 cars parked outside. I saw at least 5 kids in the yard.

I drove by there the next Saturday.

They were having a huge garage sale in the driveway. I walked up. I found out that 12 people including the kids were living there.

The house only has 3 bedrooms, where are they all sleeping?

They are pooling thier paychecks to pay the rent to their Uncle, who actually bought the house.

I am sure, none of the people living there now are legal, none spoke English.

What happens when we get smart and start deporting illegals?

Aye caramba.

Happy Baby Boomer in Glendale AZ

fish said...

You know, someone who bought at the peak, in 2005 through this year, as a "can't miss" investment, or someone who owns a collection of negative-cash-flow properties, or someone who is urging you now to either not sell, or maybe even partner with him on some deals?

Someone whose home is filled with "Make Money Flipping Houses" books, and who watches "Flip This House" religiously? Or someone who got their real estate license in the past few years?



Again you are as current as todays Paris Hilton story! I was just in a meeting where a guy I work with showed me his airline reservation and itinerary to a "Get Rich Through Real Estate" seminar. I told him wait three years and all those homes he wants will be 1/2 off.

I was then informed that "..theres far more to it than that..."! I was then told that he and his wife just bought their first property last year and were hoping to turn it quickly for a profit. I didn't feel like bursting his bubble but asked him to let me know how it worked out.

I grow to appreciate the notion of Schadenfraude more every day!

Paco Bell said...

Anon 7:11 -

An Acquintance at work who is extrememly risk averse and lacks motivation in general decided it was time to get her realtors license.

Sounds to me like your encounter was a true Kennedy Moment(tm)

sam said...

I think housing is the canary in the US credit bubble coalmine.

Hopefully, the stupidity of subprime lending while especially large and stupid will help prevent even greater stupidity by private equity, hedge funds and other consumers of leverage. And hopefully, (since I am not cheering a great depression), it is not too late.

Anonymous said...

Sure I do. That single digit IQ idiot who keeps posting here that the wealthy pays more taxes than middle class. Here's what the second richest man in the world had to say about that:

(Money) "Speaking to several hundred supporters of the U.S. Senator from New York, Warren Buffett revealed his puzzlement that he was taxed at a lower rate than many of the lesser-paid individuals working for his company.

Buffett said he makes $46 million a year in income and is only taxed at a 17.7 percent rate on his federal income taxes. By contrast, those who work for him, and make considerably less, pay on average about 32.9 percent in taxes - with the highest rate being 39.7 percent.

To emphasize his point, Buffett offered $1 million to the audience member who could show that one of the nation's wealthiest individuals pays a higher tax rate than one of their subordinates.

"I'm willing to bet anyone in this room $1 million that those rates are less than the secretary has to pay," said Buffett.

Anonymous said...

HOUSING IS TOO FREAKING HIGH,LET IT BLOW UP

Anonymous said...

"You guys are so dramatic.

Prices are crashing. So what?"

LOL! The trolls are retreating to victory!

Anonymous said...

Anon 6/27 2:19 PM: POTD as we used to say.

Anonymous said...

Buffet is being Mr. Drama King yet again with his secretary story. Assuming his secretary makes $50K a year is single, and takes the standard deduction she will pay $7586 or 15.1%. Add in a kid or two, a mortgage, an IRA and that 15% drops to 5% but for the sake of argument assume she pays the maximum.

Buffet paid 17.7% of 46 mil which is $8.142 million. His secretary paid $7586. So her boss paid 1070 times as much income tax as the secretary.

And yet liberal imbeciles like Anon 6:18 think the rich don'tpay their "fair share".

Tell me 6:18 does Buffet get 1070 times as many roads? Does he get 1070 as many airports? 1070 as many cops/firemen?

You dolt.

Anonymous said...

"And yet liberal imbeciles like Anon 6:18 think the rich don'tpay their "fair share". "

Don't be coy. The argument is in percentages not total dollars. The methods used to reduce taxable income and place individuals into lower tax brackets than they otherwise would have been favor some tax payers over others - and yes the very wealthy are among that group - partly from lobbying and partly from knowledge. Some of the very wealthy would fight tooth, fang and claw to keep a flat tax from becoming a reality. Anyone with an iota of common sense knows this to be true. As for me, I root for a consumption tax and no tax on interest earned on savings but that's just me. Devisive tax policies are not good for the country in the long run.

Anonymous said...

A p.s. to my last post - Tax policies that have been slanted toward home mortgage financing were part of the fuel for this most recent housing bubble.

Smug Bastard

Anonymous said...

nothing coy about it. Buffett pays 1078 times as much as his secretary. So what if he pays the same % of his income, he is still paying 1078 dollars for every dollar his secretary pays. Saying he is not paying his fair share is laughable.

U Why stop at only a higher income tax for the rich? sing your reasoning buffett should pay a higher sales tax, he should pay more gas tax, he should pay a higher DMV fees, etc.

As for opposition to the flat tax, you are dead wrong. The biggest proponent of a flat tax is Steve Forbes. The opponents of a flat tax are leftists.

I'm for a consumption tax too, but it will never happen. The left will never allow it and you know it.

Anonymous said...

Over 46% of all US employees did not pay any income tax at all last year.

Buffet paid millions.

I paid over 62K to the government last year for income taxes alone.

I will be paying Capitol Gains taxes on 5 properties I sold this year at about 42K a pop.

How is it that I pay through the nose but my lazy indigent or illegal neighbors on the other side of town do not pay a dime?

The benefits I get from the taxes I pay are paultry, while the so called poor get housing, food stamps, education assistance and they also use up the court systems and jam schools with their kids.

A fair tax would be a flat sales tax on what we consume not on a percentage of what we make.

Happy baby boomer in Glendale AZ

Anonymous said...

Bob Flippa is back !!!

http://www.housing-crash.com/

a.creampuff said...

Bought something from Craigslist from a guy in Manassas, a far-flung DC suburb. His development was about four years old. House for sale across the street (largest of three McMansion models 5600 sq. ft, all the trimmings): bought ~$700k asking over $900k. But down the street a "mid-sized" model started at ~$400k, went to 7-something and asking price is now...~$600k. I said, "well, at least they are still looking at a profit", and the guy said "no, it changed hands and the owner is losing $120k". Not the canary you seek, but just one more tale of coming price wars.
The guy's own story was interesting, but this post is long enough.

Anonymous said...

Batman said...
How about this canary in a GOLD mine: whenever Keith posts about gold, sell like fucking crazy because you have about a day before gold sheds about 20 bucks.

That's some voodoo curse you got there.

June 26, 2007 2:52 PM

----------------------

Gold is typically weak in the summer. It's up 10.6% from this time last year. Not too bad. I'll be looking to get some more discounted gold in the next few months. Please panic and sell me your gold.

bitterLArenter said...

I *should* have known when this hooch on myspace added me as a friend trying to get me to take out a loan with her:

http://www.myspace.com/lauralends

Yes, owing to the half nekkid pics she has up, I feel comfortable calling her a hooch.

Looking good in a bikini is not something I require in a mortgage broker.

In fact I'd call it a negative. To me, anyway.

eekamous said...

the arguement can't be percentages, it is indeed dollars. I couldn't care less what the percentage was, I paid 300k in taxes last year, did you? Do you think it's fair that I paid 20 times what you did just because I made 15 times as much as you?
I couldn't give a flying crap about percentages and why your piddly 27% is so much more than my 25%. Get a second job or shut up. Wealthy pay more. Anyone who says differently is an irrepairable fool.

Anonymous said...

"Turly said"


Turly your a whiner.
Have some balls. Talking down on some guy who's busting his ass pulling wire. Your mommy and daddy probably stuck that silver spoon up your ass and you think you've accomplished something in life. When in truth, everythings been hand to you. Go f yourself.

Anonymous said...

Steve Forbes had presidential aspirations and a flat tax was a plank in his campaign platform. I noticed during the race that his campaign did not garner very much support from those within his own socio-economic circle.

Anyone else besides Forbes that are part of the top 1% in the nation that you can think of that supports a flat tax? Hmmmm???? And, if they are, might they be running for office that requires swaying a populace?

As for coy - you are being coy. Buffet's argument is that as a percentage of income (LET ME SAY IT LOUDER SO YOU CAN UNDERSTAND THE WORDS FROM MY KEYBOARD - PERCENTAGE OF INCOME) he pays less than his secretary. You have so much faith in your convictions and math skills, go take him up on his million dollar bet and we'll sit back and watch.

Smug Bastard

Anonymous said...

"I paid over 62K to the government last year for income taxes alone.
I will be paying Capitol Gains taxes on 5 properties I sold this year at about 42K a pop.
How is it that I pay through the nose but my lazy indigent or illegal neighbors on the other side of town do not pay a dime?"

Buying and flipping properties in far flung and arid western areas requires a substantial a substantial subsidy from the government where oil and water and fire prevention costs are concerned. The war in the Middle East is being fought for the continued access to cheap oil - notice I said "cheap oil" - so that the "non-negotiable way of American life" can continue. Would you be happier Happy Boomer if we could find a way that someone else could pay for that subsidy? I'll bet you would.

Anonymous said...

(Money) "Speaking to several hundred supporters of the U.S. Senator from New York, Warren Buffett revealed his puzzlement that he was taxed at a lower rate than many of the lesser-paid individuals working for his company.

Buffett said he makes $46 million a year in income and is only taxed at a 17.7 percent rate on his federal income taxes. By contrast, those who work for him, and make considerably less, pay on average about 32.9 percent in taxes - with the highest rate being 39.7 percent.

To emphasize his point, Buffett offered $1 million to the audience member who could show that one of the nation's wealthiest individuals pays a higher tax rate than one of their subordinates.

"I'm willing to bet anyone in this room $1 million that those rates are less than the secretary has to pay," said Buffett.

HP poster says: "the arguement can't be percentages, it is indeed dollars. I couldn't care less what the percentage was, I paid 300k in taxes last year, did you? Do you think it's fair that I paid 20 times what you did just because I made 15 times as much as you?"


Might I suggest you re-read the post - In Missouri, that looks like an argument made in percentages. Your results may vary.

$300,000 just in taxes last year - Wowzers! Congratulations! Don't you have a hedge fund to run or a property to develop that you should be tending to somewhere? We promise to miss you if you will leave.

turdly said...

I went to 13 different schools in 12 years and my folks weren't miltary. I cleaned portable toilets for a living. Not for a short period of time and then quit. When the govt. announced that pcb's were a cancer causing agent of the highest degree, I was truly standing neck deep in a tranformer mucking it out. I went into the military instead of lying about my income and becoming a housing baron. I did this because it was next step, not an undeserved 15 steps ahead. Afterward I spent just 1 semester in college and realized that half of the people there were in essence institionalized because their parents sure didn't want them at home. A giant babysitter. Kind of an after school program for young adults. Fewer than most were there with an actual plan other than mommy didn't want you at home anymore.

I'm not grinding him because he has a menial job, I had them for many many years. I'm grinding him because his aspirations are misplaced. They aren't even real aspirations they are misguided attempts to leap frog from station to station in life instead of earning it. It's a ladder to wealth not a flipping trampoline. You can climb a ladder or you can stupidly try to use a trampoline to launch yourself up to a top rung. Picture the dumbass and the trampoline in your head [actually pretty funny picture, I think with practice it might even work without broken bones...1 in 6 times] then add a beer, and a copy of USA today and you've got a dumbass emmulating people who think and then act accordingly.
I don't care what you do for a living as long as you aspire for something better. It had better be ingrained in the way you think or you're going to be, I don't know, a 45 year old guy with a high school guys job, like pulling wires! A guy like that does not rate 700k in unsecured loans.

If you think he does rate 700k in unsecured loans, please please please tell me you don't have a job that serves the public. Please please please tell me you're on welfare. I sure don't want to have to count on you to; ring up my fries correctly, be a witness to anything that may require thought or rational deduction, be an elected official, be a judge or doctor, I just really can't see ever wanting you to be in charge of anything. You can see that I'm an equal opportunity dumbass hater. I don't care if you're a burger flipper or a Federal judge.
You have a station in life. Please improve upon it, religiously. Please do so without lying or cheating or having a 'right of entitlement'.

eekamous said...

He's not busting his ass pulling wires. If he were 19 and doing it he would be busting his ass. At 40 years old he's a slacker with no regard.

eekamous said...

6 year old;' mom can I have a cookie?'

mom; 'no'

mom; " i told you no, why did you eat that!'

6 year old; 'it was a brownie not a cookie'

or how 'bout;
which would you rather have $4000 a month or a penny a day doubled every day?


You can justify any arguement. Punchline is; I don't care what the arguement is this one is tantamount to a bar bet of what wieghs more a pound of lead or a pound of feathers. Believe as you like, I wasn't interested in the wording of the article, I tend not to dwell on the foibles of others and your fixation with the charlatan antic of this little speach is truly bothersome I was interested in destroying the myth that you are perpetuating that wealthy people pay less in taxes.

I do not have a headge fund to run. I do have a suggestion for you to realize that some ordinary jobs make for extraordinary pay if you do them well.

Anonymous said...

"I'm grinding him because his aspirations are misplaced."

"I don't care what you do for a living as long as you aspire for something better."

"A guy like that does not rate 700k in unsecured loans."

Might I suggest you spend equal "grinding moments" on the person(s) who extends him credit that are outside of what you believe him to be capable of repaying instead of the wire puller?

His job is a "Wire puller"? Yes, you do care (for whatever the reason) what people do for a living and if your status happens to be above their own, you talk down to them.

As for what your beliefs are about what other people's aspirations should or should not be, well, those beliefs and 50 cents will get you a cup of coffee.

Hpy Bbybmr in Glndl AZ said...

"Buying and flipping properties in far flung and arid western areas requires a substantial a substantial subsidy from the government where oil and water and fire prevention costs are concerned."

No it does not, I didn't have one property catch on fire, no fire prevention came into the equation.

If my tax dollars did help put out a fire, then shouldn't people who did not pay into the fund, not have fire protection? Why should I subsidize fire protection if others did not?

I have never been arrested, I have no moving violations, I have never been a victim of crime, I have never been subsidized in any way by any state or federal entity, I do not have children in school, I have never had a government grant or any assistance of any nature from any external source. I paid my own way through college; I have never submitted a workman’s comp claim or unemployment application. Yet, I pay the big bucks in taxes and am fully covered with personal insurance.

Wouldn’t it be better that individuals who use up services and are granted benefits be the ones who pay the taxes that subsidize them?





"The war in the Middle East is being fought for the continued access to cheap oil - notice I said "cheap oil" - so that the "non-negotiable way of American life" can continue. Would you be happier Happy Boomer if we could find a way that someone else could pay for that subsidy? I'll bet you would"

I do not mind paying my fair share dollar amount. What happens is that I pay, while most Americans go Scott-free. Just because one is below a certain threshold they are exempt from adding to the pool while those who are productive bear the brunt of the burden.

That is not fair, I should be allowed to keep my dollars and be more productive instead of having a lead weight hung from my neck because I made things go right.

If I give a dollar to keep the price of oil down, so should the drug using, lazy ass dipshit who sits at home watching daytime TV living off his government subsidy and eating food bought with food stamps or the unwed mother who keeps getting PG and already has 4 kids. Their stupidity should not equate to me paying their way.

It amounts to taxation without representation.

A flat rate sales tax without prejudice to income level is the fair solution to making society responsible for the condition they put themselves in. A degraded unemployed twit will think twice about his situation when he is forced to be responsible for his actions.

Anonymous said...

Poster writes "tend not to dwell on the foibles of others and your fixation with the charlatan antic of this little speach is truly bothersome"


I don't "fixate". I'm just fortunate to be intelligent enough to comprehend what is being written the first time I read the sentence. Were he to have said "dollars" instead of "rate", I would have had another opinion on the matter but since he chose to say "rate" and not "dollars" to make his argument, the sentence would be construed differently by most readers. In language, individual words have a particular meaning so that's why they are chosen by the speaker or author in a certain fashion and not just thrown out randomly.


Sorry to have bothered you - really.

Anonymous said...

"I will be paying Capitol Gains taxes on 5 properties I sold this year at about 42K a pop."

Can we ask if those properties were houses that you bought and lived within or if they were commercial ventures that were purchased and sold for profit?

Were those properties single family/multi-family houses or commercial or agricultural properties? How long did you own them before selling? Any of the sale financed and if so whom?

Anonymous said...

"Buying and flipping properties in far flung and arid western areas requires a substantial a substantial subsidy from the government where oil and water and fire prevention costs are concerned."

Reply: No it does not, I didn't have one property catch on fire, no fire prevention came into the equation.

http://www.glendaleaz.com/communitypartnerships/documents/CAPER_converted_to_pdf.pdf

Go see your city's page and article. Just Yahoo "Glendale Fire Prevention" then search your sites for federal funding, you'll get plenty. Many people in this country have become very good at blowing smoke up their own asses. Municipalities receive federal money based on perceived need. If you live in an arid area, the perceived need is high. Happy, Boomer?

Anonymous said...

"It amounts to taxation without representation. "

Somebody keeping you from voting? Those bastards! Call Jesse Jackson; maybe he can help.

Anonymous said...

Happy Glendale AZ boomer writes: "If I give a dollar to keep the price of oil down..."

That price is not being paid in dollars alone. It is being paid for with blood and with the morale of a nation.

Anonymous said...

Lastly - your water supply infrastructure is heavilly subsidised by Federal taxation and spending (or borrowing and spending). Should the people in areas with abundant natural supplies of water that require little if any federal spending all band together and demand that AZ folks "haul their own water" for lack of a better phrase where it comes to the costs of production? Should a special and separate Fed tax be levied against those folks using dams built and maintained with federal money?

eekamous said...

'In language, individual words have a particular meaning so that's why they are chosen by the speaker or author in a certain fashion and not just thrown out randomly.'

That's true. And those were carefully chosen. They were specifically designed to perpetuate a myth and instill a sense of indignation in those spoken to.
You fell for it. It was test to see if you could tell substance based on content.
I'll bet anyone at that meeting that said 'here here! You sir are a genious!' will be summarily dismmised by the speaker.
They say there are two types of people that take the bible without interpretation. Heretics and fools.
Thanks for not seeing that the challenge of the speech may have been for you to do a little research and form a worthwhile opinion OF YOUR OWN!
Buffet is a very funny man with a huge sence of humor and a striking wit. That comment was meant to strike the witless.

eekamous said...

Maybe I'm just horribly horribly wrong in my assumption that a smaller percentage of considerably more is...more.

Maybe I've misunderstood that foreclosures are counted as sales for many parts of the country [a deduction from reading this blog]. Maybe I should believe that rising median prices is not related to foreclosures being listed as sales for more than was owed when purchased....
Isn't that kinda the same as 'percentage is more because I didn't grasp the sentiment of the speech?'

You want to know who keeps signing up for Bomb loans? People who listen for just the right combination of words to justify anything floating in their head at the time.

'1% is less than 8%, I'll take that explosive situation for 6 times my income!'
'No, no, there's no need to research it, I misunderstood the gist of some ironic situational speech designed for a specific audience that excluded me, so I'm all in.'

turdly said...

You're only slightly wrong. I do have an unfortunate personality quirk wherein I tend to sum people up by their aspirations and their want to strive.
I find no valid arguement why someone cannot aspire; dig a little further that day [please know that I use this analogy based on my passed experiences. I needed an example of some sort], change the design of a shovel to better fit your needs, adjust your equipment for better comfort and then pass that information on to others. Aspire to one day run the backhoe, then the crew, then the company.

There are indeed reasons why someone cannot strive. The 'Peter Principle' [an old guy thing, look it up] comes to mind. Maybe you're just maxed out intellectually of physically. I am fine with that. Settle in and do a good job while aspiring to do something better.
I am not fine with a grown man who thinks he is smart enough to manage 20 times his income, in an unrelated field, having an entry level job.
Mind you; there are entry level brain surgeons and entry level everything, but you must aspire to not be an entry level anything.
I don't care if you're a ditchdigger. I did it for long enough to learn that it wouldn't support what I wanted to do with my life. I strived and aspired and I'm outa that hole.
I don't care if you're a doctor and making mazzilions. I do care if you're a doctor making mazzilions and you do not try to better yourself. I do care if you're making mazzilions and have filed bk due to nothing other than your giant lack of knowledge or common sense.

I recently had a very nice man approach my wife to have our cars washed. He owned a mobile detail trailer, was just starting out and handled himself extremely well in a social situation, well enough that I thought I had finally found someone to run a similar side business that I aspire to start up, play with, and then flip. He did a terrible job on the car. Unthoughtfull type of work. Certainly capable of better, just didn't bother. Tried him again just in case he was having a bad day, same thing, He's not going to get the job that pays 5 times what he's making now, and I'm setting the plans aside once more. I'm waiting for someone who strives.

I'll summise by saying that we are talking about canaries in coal mines here. The lowest possible entry level job in the whole industry. A death watch sorta thing. So inherently we are speaking of those that will be the signal of impending death. It's not the ones that strive and aspire within their means that will be the foreteller, it's those entry level USA today readers that want our/your position without working for it in the correct manner. The dumb canaries got caught and put in the cage. The smart ones learned by example and never go near the free food/housing boom.

Anonymous said...

"Thanks for not seeing that the challenge of the speech may have been for you to do a little research and form a worthwhile opinion OF YOUR OWN!
Buffet is a very funny man with a huge sence of humor and a striking wit. That comment was meant to strike the witless. "

Let me know how you spend the million that you win off him when you take up his bet.

Anonymous said...

Buffett: The Rich Pay Too Little

Back in 1986, a turning point in the federal tax reform debate came when President Ronald Reagan realized (with a little help from Donald Regan) how absurd it was that he should pay a lower income tax rate than his secretary. The subsequently-enacted 1986 Tax Reform Act got rid of special tax breaks for capital gains that were helping to make this possible, and brought our federal income tax system back where it should be: taxing wages and capital gains at exactly the same rate.

Twenty years later, the capital gains tax breaks are back with a vengeance-- the top tax rate on capital gains is 15 percent, less than half the 35 percent top rate on regular income-- and Berkshire Hathaway chairman Warren Buffett is ringing the same bell:

Last year, Buffett said, he was taxed at 17.7 percent on his taxable income of more than $46 million. His receptionist was taxed at about 30 percent.
By most accounts, the driving factor behind his super-low tax rate is that virtually all of his income comes in the form of capital gains.

It's a little bit harder to figure how his receptionist could be paying an effective tax rate of 30 percent, however.

Read more about it here.
http://www.ctj.org/blog/2007/06/buffett-rich-pay-too-little.html

When you are done reading it, please write back and translate so that all of us troglodytes can understand.

Smug Bastard

Anonymous said...

"You're only slightly wrong. I do have an unfortunate personality quirk wherein I tend to sum people up by their aspirations and their want to strive."

So, you're like an ever striving, eye on the ball, goal setting, glass perpetually half full type of aching pain in the ass who wants everyone else to do the same in life? Is that what I'm reading? Jeez, you make me want to go fire up a doob just reading your posts.

Anonymous said...

"I don't care if you're a ditchdigger. I did it for long enough to learn that it wouldn't support what I wanted to do with my life. I strived and aspired and I'm outa that hole."


You should write a how-to book on how to pull yourself up by your own scrotum.

Anonymous said...

eekamous rocks!


Signed,
Witless

Bill said...

here's a million dollar bet;
I can put something in your right hand that you can't readily touch with your left.

It is specifically designed to be outrageous in it's delivery yet obvious upon fruition.

It will make you create examples of many instances and draw conclusions designed to make the statement fail.
Don't you think that is what Buffet was up to?

I'd love a flat tax even if it's 50% it will act as incentive to make more money without additional penalty and everyone pays a comensurate load. If it's a hard load to bear, as long as it's equal for all, I'm all in. No deductions because you have 15 kids and I don't, no taking your boat off as a business expense. If you have unreimbursed business expenses, you'll just have to suck it up or get a different job. You can even throw in an additional consumption tax if you like. I'll keep my car longer and the guy with 15 kids will have to pay more than his fair share.

Anonymous said...

"You fell for it. It was test to see if you could tell substance based on content."

Hmmm, I've re-read the posting and some related articles and have concluded that you are an idiot.

Anonymous said...

Buffett and taxes on CNN

http://money.cnn.com/2007/06/26/news/newsmakers/clinton_buffett/index.htm?postversion=2007062700

Anonymous said...

"Maybe I'm just horribly horribly wrong in my assumption that a smaller percentage of considerably more is...more. "

Numbers are numbers and a smaller percentage of considerably more is in fact, more. Buffett's argument presented is that the percentage used in determining the amount each person pays should be roughly equal (again the multiplier not the amount) from one person to the next. The condescending tone of your posts practically screams that you equate your self - worth with a dollar sign. The self-aggrandizing posturing:

(“I couldn't care less what the percentage was, I paid 300k in taxes last year, did you? Do you think it's fair that I paid 20 times what you did just because I made 15 times as much as you?),

The self-righteous assumptions:

(I couldn't give a flying crap about percentages and why your piddly 27% is so much more than my 25%.)

Why don’t you just come clean with everyone (and yourself) and just state, “In my mind, I believe I make more than most anyone reading this post. Further, I believe I should taxed at a lower percentage rate than everyone else because of this reason: a smaller percentage of my considerably larger income is equivalent to the result of multiplying everyone else’s paltry income by larger percentage value.” Would that pretty well sum up your notion Little Lord Fauntleroy?

Anonymous said...

Capital gains tax rates are going back to where they were in the 80's (if not higher) as the budget becomes more and more constrained and as more and more baby boomers reach retirement / entitlement age.

turdly said...

June 28, 2007 9:03 PM

'So, you're like an ever striving, eye on the ball, goal setting....
Jeez, you make me want to go fire up a doob just reading your posts.



Well, Jethro I guess that's why the trolls here think we have no aspirations and smoke too much dope while sitting in our socialized housing. Good luck on your choices. We're all so proud.

I guess I ate my spoon of crap everyday instead of letting it become the mountain set forth before YOU. Kinda like a negam. Eat the crap everyday or face Bandini mountain later.
{Is Bandini mountain still there?} It was a HUGE pile of manure near L.A. Owned by Bandini manure I think....


Just so you know; the stick up my ass does indeed match my tie.


A mind is a vessel.
you can overfill a vessel.
'cleanup on aisle June 28, 2007 9:03 PM'

Hpy babybmr in Glnd AZ said...

Can we ask if those properties were houses that you bought and lived within or if they were commercial ventures that were purchased and sold for profit?

These particular properties were purchased to rent out. These 5 were all bought prior to 1995, sold in 2007. As Renters leases were up during 2006, they were remodeled to sell off.

Average original cost 77,000.00
Average sell 388,000.00
Average remodel 17,000.00
Average gain + depreciation less improvements and other associated costs 285,000.00
Average long term 15% capitol gains tax 42,750.00


Average time held with incurred liabilities 13 years.

Average lease 1 year.
Over the 13 years, 6 renters were evicted for non payment or excessive damage.

Average repairs after a renter leaves...4200.00

One home invasion and murder of renter, how do you put a price on that? That one cost me big time, not only in clean up and remodeling but the shear emotional drain was nasty on all.

When you add in the costs of management, liability, keeping homes rented out, improvements, repairs and legal fees, those profits dwindle considerably but I am still the one who will be paying the tax, not the renters who profited from inexpensive housing and in many cases skipped out on rent or left the place in shambles or stigmatized a property with illegal activity leaving me holding the bag.

turdly said...

June 28, 2007 10:22 PM

I misused the word paltry. I meant the paltry difference between 27% as a number and 25% as a number. It was a miniscule argument using a miniscule difference.

Yes I know the article said percentage, no I still don't care that it did.

I know a deceptive trap when I read one and it needed flushed out for what it was, shear worthless propoganda repeated here by some unknowing klutz hoping to convince you that anyone wealthier than they scheme and plan and manipulate.

The speach was based on a specific instance and was not meant nor designed for broad generalities, as it has been here.
As I have no investments and am not self employed I can tell you that I pay more than double [percentage wise] than my PA does in Federal and State taxes.

I cannot begin to fathom tax deductions and how they work. Children are grown, house is paid, I do not have any writeoffs.
My accountant has told me that those guys writing off the boats and sandbuggies and such and showing zero income for the year, get caught up with or are just urban myth. I have no choice but to pay the taxes.

But once again I thank you for reading the words and not the story. Mr. Buffet is not a normal person. How gracious of you to make him one of us.
A specific story about a specific man not in the 99.9% of anything is just so much poop.
I have to believe this blog is about the 90%. If I'm accidentally on the bazillionaire blog let me know.

By the way; I'd love a flat tax. Any amount, any time, just so it's equitable.

Anonymous said...

Turly Turly

All you so called educated older people are running this country. With all that ladder climbing and education that all you smart older guys have attained, and you older guys can't figure out how to balance a budget or build a f ing fence on the border? I know my uneducated self and a few friends who can balance a check book and build a fence. Unless your part of the greatest generation, your basically a nothing. You go ahead and try to improve yourself but as far as i'm concerned there is only one group that is allowed to talk smack.

turdly said...

June 29, 2007 3:57 AM
I'm less than 50. I just paid attention instead of paying for dope. I have no formal education, never got through high school, thus the occaisonal spelling faux paux.
How nice that the same people that used the broad generalities to put Buffets tax situation upon us also paint with that broad brush concerning age. GREAT ASSUMPTION BY THE WAY. I WOULDN'T OF EXPECTED YOU TO BE ANYTHING BUT WRONG.
Be the non-complying mental rebel you are. We're all counting on you to be there. We'll need something to step on while ascending.
Were you stoned when you wrote that? It drifts toward the subject but never quite makes it any point...at all. I am nothing, you are everything.

Her's your problem folks, here's who signs those loans [if ever given a chance] here's who lies there on his back like a dog and let's all take advantage of him and then cries foul when the entitlement so craved does not materlialize. Here's why the lingering troll thinks us uneducated. Please note the trigger words that have been taught. Greatest Generation, you think that up on your own BOY? Small b, little o, tiny y.

Anonymous said...

Turly


Do you still live in LA?

Anonymous said...

"Just so you know; the stick up my ass does indeed match my tie."

"Be the non-complying mental rebel you are. We're all counting on you to be there. We'll need something to step on while ascending."

The more that turdly or turly or whatever the f*ck his name is today writes, the more he reveals about his personality. What a tool. Please keep it up.

Glendale Baby Boomer Happy Buddah posts read like they are written by a burned out slum lord who sold his properties at greatly inflated profits during this a great property price and credit bubble and now is now a cry baby boomer about paying some capital gains tax on the sales. But, we're supposed to cry him a river because of some lost rental payments and because one of his tenants was murdered. Does that pretty much capture the essence of your argument? I think there are some sour grapes there because he knows deep down that the gravy train on property price appreciation is over and out and there will be no further incredible windfalls from drawing breath and owning some property in a far flung western state that is greatly subsidized where oil and water prices are concerned. If you decide to vahamos from the desert and live somewhere else please post where that is so that I can make certain that I never move there. Fricking locust.

Smug Bastard

Anonymous said...

Turley writes "Her's your problem folks, here's who signs those loans [if ever given a chance] here's who lies there on his back like a dog and let's all take advantage of him and then cries foul when the entitlement so craved does not materlialize. Here's why the lingering troll thinks us uneducated. Please note the trigger words that have been taught. Greatest Generation, you think that up on your own BOY? Small b, little o, tiny y. "

Jesus Christ, it looks like something out of Mein Kampf. Turley, did you help Ted Kozinski write his manifesto or did you just take notes for him?

Anonymous said...

I think that Happy Buddah Glendale Boomer is your canary in the coal mine.

Anonymous said...

To "ASS - piring TURD - ley"

Might I suggest that one part of the reason we have had this housing price bubble is because too many people improperly enabled by too many greedy lenders "ASS-pired" to become the next Donald Trump? A nation of over - "ASS- piring" people blowing smoke up their own ASS-es.

Anonymous said...

Happy Gilmour Baby Boomer is a "get rich in real estate land lord" trying to figure out why he did not make even more money on his rental houses and subsequent sales than he did during the bubble. More is always better is his creed. Part of the equation behind his angst is the property gains tax and he believes it to be unfair. Hey dude, if you've got as much jack as you claim to have, why not set up some tax sheltered accounts in Cayman, etc. You're a smart guy, taxes are for idiots.

Don't tax me, don't tax he, tax that fellow behind that tree.

The song remains the same.

Jimmy Page

Let's go smoke a fatty turdley.

Anonymous said...

Hey Boomer, here's to hoping that your next meth-cooking tenant blows your crapbox desert rental, himself and you up while you are over there haggling to get a piece in lieu of an overdue rent payment with his skank old lady. Addition by subtraction.

turdly said...

June 29, 2007 2:19 PM Might I suggest that one part of the reason we have had this housing price bubble is because too many people improperly enabled by too many greedy lenders "ASS-pired" to become the next Donald Trump?

You can suggest it and it's even true. Here's where it all got wrong, and basically where the arguement started; You do not leapfrog to wealth. If you're a ditchdigger you aspire to [in this order] run the backhoe, then run the crew, then own your own ditchdigging business, then keep an eye out for whatever may be next.
Where it went wrong was; A HUGE LUMP OF UNTALENTED, UNINFORMED, NONSTRIVING TURD DECIDING THAT CONTROLLING 700K, {50 TIMES HIS INCOME}IN INVESTMENTS WAS A GOOD PATH TO TAKE. He lied on the application so he could jump many many wrungs on the ladder.
It equates to my being a surgeon. I'm just not a surgeon. I won't lie about being one. However if I had to commit surgery I would prepare wholeheartdly for it. Whether I had 3 minutes or 3 weeks, I'll prepare. 700k is financial death to someone who makes 35k a year. It should be prepared for, not flippantly lied about.

That's how this string got started, it just took me a while to get you to say it. You saw it, you chose to ignore it and embattle it, but you sir, have succumbed. Here's your words; 'this housing price bubble is because too many people improperly enabled....' If you believe it's lenders you in turn believe it's buyers.

I'm out on this one. Either you see you've turned to my side or you're just to stoned to participate.

Anonymous said...

"I'm out on this one. Either you see you've turned to my side or you're just to stoned to participate. "


Oh, what you do to me, oh, what you do to me, little girl.
Ooo, have another hit of sweet air, come on, ooo, have another hit.
I want to know where you're going,
I want to know, sweet mama, where you're gonna go, yeah.
Ooo, have another hit of fresh air, ooo, have another hit.
Oh, baby, what you gonna do, oh, honey, what you gonna do, sweet thing?
Ooo, have another hit of sweet love, ooo, have another hit.
I love you, yes I do, babe, and I love you, I do, sweet lips.
Ooo, have another hit of sweet California sunshine, ooo, have another hit.
Take me home, take me home, take me home with you,
Take me home, I wanna go home with you, little girl.
Ooo, have another hit of fresh air, ooo, have another hit.

Far out!


John Denver

Anonymous said...

zeig heil turlmeister

Anonymous said...

"Here's where it all got wrong, and basically where the arguement started; You do not leapfrog to wealth. If you're a ditchdigger you aspire to [in this order] run the backhoe, then run the crew, then own your own ditchdigging business, then keep an eye out for whatever may be next."

Words to live by - from the Gospel according to Turdley.

All hail Turdley!

Anonymous said...

Happy Buddah Glendale Boomer writes:

"I sold one of my rental properties in March 2007 to an Hispanic cook at the Biltmore.

268,000.00

I paid 86,000.00 in 2002.

I put mucho dinero in my pocket."

So turdley, you love hanging the slacker buyer/investor and greedy lender out to dry in your posts. Does a seller bear any responsibility in the credit/housing bubble or is that just the capitalist market in action?

Smug Bastard

Anonymous said...

"This guy is a human mule, he pulls wires for a living."

- Turdley post

Work hard kids because you wouldn't want to disappoint the world's asshats and not win their seal of approval.

Anonymous said...

Turdly, do you think that your opinion about his being a "human mule" (based on the job he performs) comes out as you are trying to "educate" him? Or is the "human mule" just really stupid and he doesn't pick up on the condescending tone?

Are you bright enough to pick up on the condescending tone of my posts to you? Just wanted to make sure.

Anonymous said...

Turdly's experience with a mobile car washer:

"He owned a mobile detail trailer, was just starting out and handled himself extremely well in a social situation, well enough that I thought I had finally found someone to run a similar side business that I aspire to start up, play with, and then flip. He did a terrible job on the car. Unthoughtfull type of work. Certainly capable of better, just didn't bother. Tried him again just in case he was having a bad day, same thing, He's not going to get the job that pays 5 times what he's making now, and I'm setting the plans aside once more. I'm waiting for someone who strives."

Turdley, you are the “grab the bull by the horns” aspiring and astute business mogul - why are you waiting on someone else to come along to partner up with? There’s nothing stopping you from grabbing a trailer, a sponge, a hose and a squeegee.

Can someone please guess on how many bodily fluids are routinely delivered to Turdley’s plate by the wait staff each time he goes out to eat in a restaurant? For the lightening round question - how much time and interaction does it take for the waiter to realize that Turdley’s plate of Egg Foo Yung is not going to be a complete dining experience if it doesn’t contain that special hit of Cream of Sum Yung Guy?

turdly said...

'So turdley, you love hanging the slacker buyer/investor and greedy lender out to dry in your posts.'

I don't think I've berated the lenders, maybe a specific instance but it's their money, they can write the programs. If you don't want the bomb loan, don't sign the docs.

I do have a horrible problem with the current sellers. Who told them that just because they have lived in a home for 3 years that they are entitled to 300k in profit?
I don't know how I would handle it if forced to sell the house. I'd be a chump for not taking the money, I'd be a hypocrit if I did. I'd like to think I'd do something valiant but wife is a lot more practical than I. What I really hate is the happenstantial homeowner that think they are now an expert because they 'made so much money'. This false sense of accomplishment leads to, flipping, Hummers, stock purchases. If you think the success is yours and it's not it leads to trouble. Housing is in trouble. It's because of a false sense of success. It is going to be the educated that prevail. Most people here will be fine because they didn't buy, or are hunkered down and making a viable plan if they did, and those bunch of us that aren't in this pickle. We didn't take the heloc, we didn't refi, we just la la la'd along with our 5% cd's. Same ol' story, same ol' investment, just plodding along. There are a bunch of us. If you're not moving, didn't bomb or heloc, this is not going to affect because you're not selling, and the equity only counts when it actually hits the bank account.

My tirades all boil down to I'd love a return to something that smacks of what used to be percieved as normalcy.
20% and some pride and skin involved.
10% interest rates, it's just stupid to lend for less.

an aside; a 500k mortgage with 20% down and 6%apr is the same payment as that same house with; 20% down 400k and 8% or; 300k 20% down and 11%apr so a combination of lower prices and higher rates will work, just like it has for 100's of years. The 300k house save you a bunch of downpayment that you can put in the bank drawing the 5%. We didn't. we put it back into the house. Somtimes I succumb.

I want assumable loans to be a viable option again. They were in place for years because there was no expectation of profit from a home. I don't think assumables work well, it just works as tool to make the expectation of profit not be in the forefront.

Someone with 35k income having control of 700k is wrong unless expert knowledge is involved. It would be wrong if he said he was a pilot and you turned him loose in your plane, it would be wrong if he said he operated heavy equipment and you turned him loose in your gantry. It's just wrong. It's prolific. We're about to have a lot of planes crashing into a lot of cranes.

Anonymous said...

"My tirades all boil down to I'd love a return to something that smacks of what used to be percieved as normalcy. "

As someone who has been waiting on the sidelines for over four years for the collapse of this credit bubble, I will agree with you on that sentiment.

Smug Bastard

ho moaner said...

I just saw that stupid Ditech commercial again. The one where a guy in a turban cuts your house in half with a sword while the announcer says 'people are smart'.
Who are they trying to capture with that?

Anonymous said...

This time it's going to be worse than the Greeat Depression"

You're so right! During the Great Depresson they didn't have 12 million illegals running around like they own the joint, and there were no middle-east terrorists with wmb's. You're right on brother, but what an understatement!