Also the TNT did do an update on the story. There are 21 units pending. Still not great but i guess better than nothing

http://www.youtube.com/watch?v=62DtPMskSk4&feature=related

To be more succinct, tax breaks are good. But phony tax breaks, which are really massive loans taken out on the behalf of the American worker, are really, really bad.

IMO, it starts with the rich corporations paying for politicians to get elected. Once they’re in, they become servicers for the wealthy and begin to provide special favors and breaks for those that sign their paychecks (corporations and special interest groups). The theory is, by stroking the hand of the rich corporations, they will invest in infrastructure, which will create jobs. Thus, the favors granted the rich trickle down and also help the poor. Obviously, it is the poor who pay the greatest share of taxes in the country. Yet they can least afford to do so. But without the wealthy, the poor don’t have jobs or means to pay for food, so it’s a fair exchange.

Thus, trickle-down seems like a good idea. Unfortunately, it doesn’t actually operate as stated. Much of the breaks to the wealthy are invested in leveraged paper or shipped out of the country to service contract wars or cheap labor, so little new actual infrastructure gets built. And as we’ve recently witnessed, when the leveraged paper turns to pigeon dung, the poor end up footing the bill in order to cover the losses of the wealthy investors (i.e stealing from the poor).

It’s a shame, because the republican party used to be very fiscally conservative. Unfortunately, when Reagan and Bush Sr. got in, they could not get Reagan’s new trickle-down economic theory to work, so they ballooned the debt by 4 times. This is a well-known way of artificially stimulating the economy in the short term. But it causes mass chaos down the road, such as we’re experiencing today.

Debt Chart

The debt pyramid scheme (bubble) is reaching a critical mass, and it is resulting in the unraveling of our countries great financial system and threatens to destroy America’s status as the number 1 economic superpower. Each additional $1 trillion we borrow amounts to another direct taxpayer loan of $6667.00 for every working American. But in truth it amounts to a much higher loan than this because we borrow the money to service the debt and tack it onto the loan. In the housing industry, such loans are better known as Alt-A mortgages. Such loans are thought to be the next wave of defaults that will further cripple the financial sector.

At some point, Americans will have to face the facts and become fiscally conservative again or go into bankruptcy as a nation. But no one wants to do that because there is so much money available for rich corporations and special interest groups. Since the beneficiaries of the hand-outs aren’t responsible for the repayment of the debt, they would be crazy to stop taking the money. It’s a mess.

“Actually, if you really think about that, people would be up some% if they bought in at $0.”

The typical way of obtaining stock is to pay fair-market value. For instance, GM cost $42 per share one year ago. Let’s say you picked up a bunch an put it into your 401K. Now fast forward to today, and the price is now $4.69 per share. So you lost 88% of your money. OTOH, if you were one of the few people on the planet who inherited the stock (bought in at $0), then you still have a profit. Such examples are probably 1 in a million though, and I’ll bet those people are just as panicked as if they had actually had to pay for the stock.

Sunday Buzz: Real estate in play as WaMu and others shrink

The Great Disruption hits Puget Sound hard

“I’m not exactly thrilled with trickle-down economics. Steal from the poor and give to the rich”

My understanding of the trickle down theory is that you tax the rich less, which I guess around here is the equivalent of stealing from the poor.

“The Dow is down 41%. In thinking about that, it’s important to keep in mind that nobody bought in at $0. Thus, the losses are much greater than 41%.”

Actually, if you really think about that, people would be up some% if they bought in at $0.

Jake you were busted by the TIm… Watch out….The Bubble knows all…

BTW The Tacoma Home Show was actually busy yesterday. I got into at least 5 meaningful conversations, 2 people mentioned a blog (sorry not Bubble Tim), and I believe the Show was easily worth the 1500 it costs to get in. We still have Sunday to boot. Our “Lead Generation” jar for refinance and purchase has about 50-60 entries and the usual 4-5 will turn into transactions. Not to bad.

I avoided all food at the Dome and look forward to the Seattle Home Show this week. About 50 shirts left going into Seattle.

As for condos in Tacoma …please….They will continue to drop like a rock. What about the 500-800k project overlooking Ruston? GOOD LORD! That development looks about 6 months away from completion surrounded by 180-250k homes up and down the street for sale.

No, the military/ industrial complex is a thing of the past. This is why I blame Bush and Cheney. They bombed infrastructure. That is a bad military tactic if you intend to invade, capture the legally elected head of states, kill his sons, put them on display, then hang the head of state and broadcast it on YouTube. It was just stupid militarily, economically it did establish the United States as a tough negotiator.

The infrastructure was the key, the give away, Bush and Cheney wanted us in there for a very long time. Cheney said he can clean it up and Bush believed him. The idea was to establish a second economic presence in the Middle East. It was oil, and Africa. Europe needs Africa to survive. Africa has resources, Europe builds fine automobiles and watches.

In my opinion the economies of the world got way too big. I mean the economies. I think even businesses and corporations never saw how grand things became. I think CEOs sat and looked at numbers they had no reference for. It grew beyond any one’s expectations. I think if you were to ask Warren Buffet or Bill Gates or even Schultz the Starbucks guy they’d tell you they had no idea they would make multi billions of dollars in one life time.

There is no crash. There is no burning and there is no going back. It’s only money and it’s still out there. The panic for government is that nothing has stopped, business is still business, dollars are dollars.

You can not militarially contain six billion people on the planet. You can nuke ‘em but that might upset them. Governments made promises. The world would collapse without them in control. Is that really what we are seeing or will corporations start making more demands?

In the 1970s there was another obscure economic theory that future wars would be fought economically. I think that’s what Reagan did. I think Reagan won an economic war. I think China is trying right now to win an economic war and it’s going sideways on them.

I do think the internet has changed the playing field. I think that any one with an idea and computer can make money. The idea of making a million dollars used to be a grand idea, today it would take a billion to impress any body.

So, once again let’s tip the Tim a million dollars and see where that leads, at least we would be doing something for some body, and maybe ourselves. Who knows what he would do with the money.

So, don’t keep us in the dark, what’s going on? Thanks.

I could be mistaken, but I think that’s what David Losh is fascinated about. We don’t need gigantic companies to take our money and treat us like indentured slaves. The little guy can figure out a way to turn an honest buck and live free from the military/industrial-complex. If that’s his point, then I say, let it crash baby! Bring on the crash! (not to say that David agrees with me on allowing the crash)

People are getting hurt in this, and I mean really hurt. The Dow is down 41%. In thinking about that, it’s important to keep in mind that nobody bought in at $0. Thus, the losses are much greater than 41%. In many cases people are losing everything.

But that’s the price one pays for surrendering freedom and paying someone else to make life’s most important decisions in order to live temporarily free from worry and responsibility. Any good con artist knows his victims get what they pay for. They get the delusion they are being fed. If it weren’t worth the price, they would never buy it in the first place.

If people realize they’ve been conned, and it turns out they don’t like what they bought as much as they thought they would, then it’s not too late to stop making payments and invest in a different product.

I’m just guessing, but I’m assuming that if The Tim quickly got a million dollars in donations he probably would not be investing in Seattle real estate.

There is an economic theory about the Internet business model.
In China there are a billion people. Apple, along with other companies, have tried to open the market of small portable computers to be in the hands of more people.

A statement made at a computer expo has stuck with me. If everyone in China in one week, or month, or year, purchases one product, from one web site, for a dollar, that’s a billion dollars in sales.

There are six billion people in the world. Let’s say 10% buy a single product from a single web site for a dollar that’s six hundred million, 1% six million.

For the Tim if 100,000 people contribute $10 that’s a million dollars.

Is it possible? Yes. Probable? Yes. The question is the time factor.

The second question is when he gets the money what will he do with it.
Will he build more sites, or invest the money in the stock market?

My experiment is simple. The stock market crashed or corrected as the spin goes. Comparisons are made to 1929, 1987, and 1999, or 2000.

I believe the internet is a wild card in the business world. Banks, hedge funds, even commodities are an old way of thinking. Real Estate has new business models, as does ETrading, shopping, insurance, mortgages, and the list goes on. It seems to me that as individuals we have the ability to handle our own finances.

To prove the point it’s my goal to have the Tim make money from this blog, lots of it, a million dollars.

I honestly believe the internet is the new face of commerce. Anything is possible. With a million dollars we could see where the Tim would invest it.

If you made a million dollars from an internet venture would you turn those dollars over to a Mutual Fund, Municipal Bonds, Gold, Oil, or the billions of other “smart” investments in the world today?

Check out the equity calculator

Nausea inducing crap

Today while driving around Seattle and West Seattle I’ve notice many projects just sitting idle.

In the 1980s I had a company that finished out codo projects to make them bank financable. Developers usually paid at first then the banks started protecting the investments they had by at least getting the roof and siding in place.

Today is much different than anything I’ve seen.

Unfinished projects are one thing for the homeless, but what about the properties that are vacant and haven’t been torn down for redevelopment. I think this winter will be ripe for random fires, homeless hurt in abandoned buildings, and neighborhoods facing problems with homeless moving into nicer neighborhoods.

Whats also Interesting is that the Price of Gold and Silver also, moving Irratic.

The way I See it… Gold and Silver paper trading is NOT REALLY BASED ON THE ACTUAL METAL.. Its been built kind of like the Banking System where the Actual Trading price is Fictionous… Those paper trades if you actually asked for REAL STUFF.. There just wouldn’t be enough to cover MUCH..

They have really screwed up, just about every marketplace… With Massive Leverage and Paper Created out of Thin air.

YAHOO FINANCE: 6.16%
It was only couple of Days ago roughly 5.8% – THATS FOR 30 YEAR FIXED….

There some real big problems behind the Scenes… I haven’t remembered interest rates “Quittt, Jumping like this… ESPECIALLY AFTER .50% Interest RATE DROP, BY THE FED…

WasteWater Condos were overpriced crap from the beginning. The rents they were asking after giving up on sales were 25-50% higher than comparable units within a few blocks. So yeah, they’re desperate.

Two banks have already failed today in other parts of the U.S.

It’s up to three now….

Anyone notice that there are now several small banks advertising on the radio heavily….just like what WaMu was doing a few months ago?

First it’s a plea for small business owners to move their accounts. Next they’ll be offering high yield CDs.

Two banks have already failed today in other parts of the U.S.

http://www.fdic.gov/news/news/press/2008/index.html

http://www.slideshare.net/eldon/sequoia-capital-on-startups-and-the-economic-downturn-presentation?type=powerpoint

You sound suspiciously like someone with something to sell.

That should tell you something.

In the Q&A, Dean Jones of Realogic says:

We’re tracking the downtown Seattle area — from Yesler Way north to Denny Way (includes several Vulcan projects) and from I-5 west to Elliott Bay. There are about 950 available condos right now, which includes all resales and all new construction in that area

Head over to Redfin and check the number of MLS condo listings in the same area… about* 350. So the “real” number is 2.5 – 3x the listing number.

In the same area, about* 450 units sold in the last year. So there is an over 2 year supply on the market.

*I say about on these numbers because I am eyeballing the ones east of I-5, which are included in a search for “downtown” in redfin but appear to be excluded from Dean’s definition of the area covered.

not bad at all, if you’re a RENTER

By the way, I thought Tort reform was supposed to address skyrocketing health care costs. Again, I believe they treated a symptom without understanding the underlying fundemental cause of the problem. People suing insurance companies was not the problem, insurance companies not living up to their obligations to policy holders was the problem. So, the solution? Don’t let the policy holders get any legal relief. Yeah, sounds logical.

We’ve thrown away nearly a trillion tax-payer dollars in addition to the losses in the market which was not sustainable. Yet, the markets continue to drop as they should. There is a difference between value and price; people don’t get it.

I’m just making the point that when Seattle house prices continue to fall, it’s not going to be because of the credit freeze or the stock market plunge, it’ll be directly caused by the fact that house values are inflated and unsustainable — something many Seattleites doesn’t seem to grasp.

http://www.westwaterrentals.com

“Brunswick Corp. will permanently shut its Arlington yacht factory by year’s end, idling most of the facility’s 790 employees, the recreational equipment company said today.”

I feel the cynicism in post. This guy purports to recognize the current problems, but fails to see the larger picture. We bubble-heads have been pretty consistent in our predictions/opinions. But, anyone even remotely involved in the RE business will try to shine a turd no matter how it flies in the face of pragmatic common sense. Seriously, they just feel the splatter at some point, ehh?

All this yap about MS; does anyone realize that they too are being effected by world economics and greater competition?

Getting rid of Herpes was easier than selling a Seattle area Condo.

It’s time for the political leadership in this country to step up and lay out the real problems and some real solutions. And other than Ralph Nader, none of the main candidates for president are even close to approaching what needs to be said and done.

On the other hand; yay! My rent will finally start to drop again! Wheee!

I like Tacoma, it’s an honestly working class and middle class city. With none of Seattle’s pretenses to being “world class” and special. I think Tacoma will coem out of this “better” than Seattle, simply because Seattle has dug it’s so very deeply into the various bubbles; personal debit, housing prices, commercial short term loans for worthless projects and expansions, endless corpraote acquisitions, oil prices, etc.

My concern is all these big holes elft all over Seattle will become breeding grounds for West Nile carrying mosquitos next summer.

http://community.seattletimes.nwsource.com/reader_feedback/public/display.php?id=874