147 comments on So they all knew it was a bubble, now?
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147 comments on So they all knew it was a bubble, now?
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Robert...
I disagree with your scenario about the attitude of home buyers. It strikes me as too cavalier. Some people might be doing what you suggest, of course, but certainly not the majority. The difference between the average buyer and the finance guy or the banker is a big one. Most buyers' motivation is to have a home, and a mid-to-long term investment.
Most buyers have no idea how the financing really works. They are told in various ways (via books, as well as by mortgage sales folks) that it's EASY to get a mortgage. Thrilled they can have the chance to own a house, they sign on the dotted line. After all, if they are told the monthly payments will approximate their rent, why not do it?
Beyond the situation where someone has an adjustable rate that starts jumping higher, there are all other costs of owning real property. Ongoing maintenance costs, emergency repairs, increases in utility rates, increases in taxes, increases in additional necessary costs such as water and sewer and garbage pick up if those aren't included in local taxes. Let's see, then there's gas, food, and...
I guess I'm taking your comment personally because those are the things that are slamming me right now. I bought my current house three years ago (very low fixed rate - with a solid bank lender) and seven months later I lost my job. I was out of work for quite a long time and dipped into savings over and over to keep afloat. Now I have my sweet home (my third in 25 years) on the market and it's not a pretty picture.
My credit rating was STELLAR when I closed on this place, but now...well, I'm walking a tightrope.
This is probably how decline and collapse of civilization is going to feel, personally, for each of us.
Suddenly. For no apparent reason. Your services are no longer required. Society has no room for you as a contributing member. You are no longer part of the mainstream. You have been cut to run on your own.
The place where you seek shelter; your home, quickly slips out of your hands ... and then you are out on the streets, homeless.
You get relabeled as a loitering vagrant, a rabid dog to be shot on sight. You have only yourself to blame. Do not cast mud on those who lured you into suburbitopia and who profited in the process. They are the white shirted angels who were merely doing "business" in the fair and square tradition. They are without fault. It's all yours to be enjoyed on an exclusive basis. Heads they win, tails you lose.
Also known as "manadatory retirement", which millions of us experience every year, good years and bad.
The fun part about being a Cassandra is you only have to be right once to get an "Infallible Oracle" brand on your forehead. You can be wrong time after time but that one time that the end really is nigh, you get all the babes.
Hi Bkhere,
I can sympathize if Robert cannot.
I was unemployed for five years: 2000 through 2005.
Never had a home but lost all retirement savings.
Today I spit in the face of politicos, particularly republican ones, since I did everything society told me to do:
- stayed out of trouble
- didn't do drugs
- served in the military
- earned two college degrees.
So much for all of that "pull yourself up by your bootstraps" republican bullshit.
I for one am ready for a reset to the American dream which in my world means the "Second American Revolution".
All I can say is hang in there and spit in the face of the bullshit artists like Robert. They know not of your pain, only their betterment at our expense!
May we know what your areas of study were in college?
Hi SacredCowTipper,
Yes, BSEE and MBA.
Of the two, the MBA has proven far more valuable as US corporations have hollowed out technical staff in favor of outsourced expertise.
Quite counterintuitive.
By the way, I PAID for both of these degrees myself - no handouts from anyone!
I wonder how many here are aware of this other phenomenon, namely, that being all you can be and getting an engineering degree is the new lie of our society?
Prole is not kidding. I work in a tech-affiliated field and see over the recent years how the engineering ranks have been decimated in the USA.
The big laugh is watching politicians (like Barak Obama on CSPAN this morning) extolling the virtues of getting a higher education and graduating more engineers in this country. He probably means well. Just doesn't have a clue.
Today, even getting an MBA is questionable as the financial remnants of our hollowed out economy begin to crumble under the stress.
I had a friend in law school whose brother graduated from Notre Dame with a an engineering degree and high honors. Could not find a job. Wound up going to DePaul law school.
Problem is ... everybody is going to law school.
There are WAY too many lawyers. It is a pretty sad commentary on our society that everything has to be settled by litigation or incarceration.
Better that than settling everything the old fashion way ... by uncivil action, such as by a duel to the death.
But my point was not that. Rather; when they "all" graduate from law school, who is going to be their client? There won't be anybody else left.
While it is true that a single lawyer in a small town starves while two do well, the curve doesn't keep going that way. If the whole town is filled with nothing but lawyers, they're all unemployed.
Milton Friedman made the observation years ago that our economy was heading towards a unsustainable service economy where there would be two insurance salesman facing each other at a table and trying to sell each other insurance.
Bruce,
My records show it is time for us to meet and reassess your current insurance policy. We have many novel packages that will match with your evolving needs. We have a new post-peak plan called Catchusifucan which is ideally suited for your demographic.
"If the whole town is filled with nothing but lawyers, they're all unemployed."
That would be..... Buffalo, NY.
Well, as they say, a town that cannot support one lawyer can always support two.
We're trying to do something about the lawyer problem.
http://www.prosefights.org/nmlegal/nsalawsuit/nsalawsuit.htm#reportresponse
I have an MS in Mechanical Engineering. When I started school in 1967 the LA Times had (no kidding) 100 pages of employment ads for engineers. Even though I don't look for work anymore I am amazed at how few engineering jobs are available in the SF Bay area. I suppose if your talents are in software or specialized EE areas you are employable but for mechanical types: head for China.
Ditto for Silicon Valley.
There was a time, before the 2001 dot.com bust when the Sunday paper was thicker than two telephone books because of all the help wanted sections.
Now it is an anorexic shadow of itself.
There aren't even the same number of regular advertisements.
Who are you going to advertise to? The unemployed engineers?
(Of course, part of the problem is that jobs, classifieds, etc. are now advertised on the internet rather than via newspapers which is why papers are dying. However, the general trend is still that all the hardware jobs are heading to China and all the software jobs to India and Romania. Silicon is no longer made in "Silicon" Valley. It's all made in China, Taiwan, Malaysia. We have "evolved" into a "new" economy thanks to globalization.)
I'm an underemployed engineer myself - Iowa State's computer science program, and now I work in that icky VoIP area. Its booming, even today, but I'm underworked due to disability. I have a mild case of Asperger's Syndrome - I look and act normal a good bit of the time, but I'm different enough in person that its caused me immense grief in employment.
A number of people posting here seem to have mentioned Asperger's. If there's ever a new demographic questionnaire done, that might be an interesting question for it. Could be that hyperanalytical people are disproportionately drawn here.
Or maybe not caring about social herding cues confers an advantage for 'black swan' type perceptions.
Or perhaps we're just peculiar.
You can add me to the list. I definitely have ADHD and may have some kind of aspergers/high functioning autism. Or just have lousy social skills. In any case, one person said I have it and other people say I don't. People don't come to TOD if they think the solution to peak oil is to con some other poor bastard out of their oil.
I also have Asperger's. I have also noticed more and more those posting on this forum and others saying the same thing. I too have wondered what the percentage of "Aspies" or others on the Autism scale are represented on TOD. I do know that we with Asperger's tend to view the world differently than most.
Anyone else out there?
Given the high maths involved, the aspect of this case being very complex, though very interesting, from a logical point of view, so counter-intuitive (from the business-as-usual standpoint), anti-social, and so fundamentally "big", I have no wonder at all that many "aspies" are interested in this subject. For me it is corroboration that it is such an interesting phenomenon...
New lie? You think this is a new lie? You obviously haven't been around very long. Engineering is and has been a terrible career for anyone wanting steady income and security. I know engineers who spent half the 70s on unemployment after the aerospace crash. Every senior engineer I know from the 80s on has told me to get my MBA if I want a chance of staying with a company beyond the completion of a contract.
You're much better off becoming a plumber. Toilets always need unplugging and it's not a job that can be successfully outsourced to India (the trip charge is a deal killer!).
Orion,
I'm right there with you. I was on one of those on the unemployment lines in the 70's (when the Vietnam war ended and there was no more of a need by our Great Society for engineers to calculate how much Butter is needed for lubing the Guns).
However ...
Do realize that every year our universities graduate a new litter of technology-armed graduates, salivating at the mouth, wagging their tails, and eager to serve their masters. The Market will provide.
You got a surplus of skilled engineers? That is one of the bottlenecks in the Swedish workforce. You dont happen to also have a surplus of skilled programmers, welders, plumbers, metal cutting machine operators, concrete workers and so on?
Its odd if skilled people cant get work, you ought to invest like mad in the energy sector and so on.
Hi prole,
I'm right there with you since my life to date fits much the same profile. I also hold a BSEE and hope to be finishing an MSEE in a month or two. I tell myself the MSEE is for me, but I probably wouldn't be doing it if the company wasn't paying. Sometimes I think I should've spent all that time going out to get high and get laid.
As luck would have it I also work in the MI-complex. My idiot managers are throwing my skill, training, and intellect away on filling out Excel spreadsheets and adjusting sliders in MS Project.
To put things in perspective, I was working with Excel and drafting architectural plans in AutoCAD in middle school. I was designing and conducting my own mechanical and acoustic science experiments in high school. I helped design, build, and successfully field test cellular repeaters in college.
I get my passive-aggressive revenge on management by constantly showing up late and doing about 10 actual hours of their 'work' a week. Somehow I wound up with two cubicles, so I can almost always tell these pukes, "I was in the other building dude." If that fails, then "I was taking the Browns to the Super Bowl."
My friends and I find it physically painful to watch "The Office" on NBC. That's how accurate a picture it paints.
It's a "cost plus contract".
You're the cost and your managers are laughing all the way to the bank.
They are not "idiots".
Instead, you are Dilbert.
Why do you live in a cubicle (or two)?
Don't you deserve an office?
For heavens sake you have a BSEE degree!
P.S. When I was young, I too worked as a double E (with MS!) in the MI-complex. I was too dumb to understand that I was just cannon fodder for the cost plus contracts. They didn't want me to actually do good work; just to run up justifiable costs. That's your real job dude. Figure out how to charge Uncle Sam more without being caught.
I can still find work with my MSEE degree but now it has to be with military industrial companies prevented by the nature of their work from offshoring. I spent the first twenty years of my career making products people actually wanted to buy.
I think a science education is a very useful and scarce thing to have even if it doesn't directly lead to lifetime employment. There are already too many idiots out there. Why do people get liberal arts degrees? They think reading Shakespeare in the original Klingon makes them a better person.
Hi Bkhere,
I can sympathize if Robert cannot.
I was unemployed for five years: 2000 through 2005.
Sorry to hear that.
Never had a home but lost all retirement savings.
May I ask why you never purchased a home?
Today I spit in the face of politicos, particularly republican ones, since I did everything society told me to do:
I got laid off in 1989, with a optical physics BS, I was underemployed for two years, then started my own buiness and now semi-retired at 45 years old.
Pulling myself by the boot-straps was good advice for me!
- stayed out of trouble
- didn't do drugs
- served in the military
- earned two college degrees.
Thank you for your serice. Sometimes it takes more than what you've outlined to succeed in life. You didn't buy a home, at time when homes were inexpensive, thus I suspect, but await the details, on your investments you made in the 90s.
Did you have a divorce in your recent past? That alone can break some people finanically.
So much for all of that "pull yourself up by your bootstraps" republican bullshit.
Like I said above, worked out pretty good for me. The people I grew up with who didn't pull themselves up are the ones still living off of Mom and dad's kindness!
I for one am ready for a reset to the American dream which in my world means the "Second American Revolution".
Oh really? Notice how everyone is "ready" but they never actually do something about it? So you had some bad luck, what can I say since I don't know much about you, and you want to burn the barn down? Do you realize that would ruin many millions of lives who haven't had your bad fortune?
Or do you not care?
All I can say is hang in there and spit in the face of the bullshit artists like Robert. They know not of your pain, only their betterment at our expense!
I'm sorry you are so bitter. I will say a prayer for you that things will turn around.
Steroids anybody?
Not only are these "winners" convinced of the validity of the system, but it was their talent alone that led to their success. Never mind any luck or uncontrollable circumstances being involved such as being in the right place at the right time, having the right mentor or friends, or even having the right name or color of skin. Can’t have any doubt as to the merit of the status of our high stations can we.
Bruce--
For more on the subject, a recent book called:
The Social Atom examines this thoroughly--
It is by the former editor of Nature, and a excellent read.
Most of our conceptions of the conditions success and failure are pure fantasy.
Hightrekker, thanks a lot! I'm looking for a new book to put on my reading list. I will order it today.
In that case, you should definitely also read N. Taleb's Fooled by Randomness. It covers exactly this, and more, and is an entertaining read.
That's the way it is with winners and losers in any zero sum "game". The winners are convinced everything was fair and balanced. The losers are convinced the playing field was tilted.
Steroids anybody
Your cynicism is frightening.
What can I say? I got a late start in life, but I ended up pretty well off.
It took me 7 years to get throught college-I worked full time my first few years while going to school part-time, then took some student loans, changed my major, then I only worked part-time while finishing my degree.
My house is paid for, I own a ranch in the southern part of the state. I did it through hard work-50 to 60 hours a week frequently, and some good investments.
There are a lot of people who feel the same way you do. If things didn't work out for you, it must be because the game is rigged.
I disagree, if I can come from a blue-collar family to be semi-retired at 45 it can happen to others. Not everyone, but it is more than possible here in the USA than anywhere else.
There are a lot of people that work hard 50-60 hours or more a week and do not have a paid for house, a ranch, and are semi retired after a business that was started in 1991. As far as America being the best place for upward mobility studies have shown this is not the case, and cases such as yours are becoming more and more the exception in a society that resembles the “Gilded Age” of the late 1800’s where the income disparity is very wide.
An earlier statement of yours in another post confuses me however:
Most people I know that own businesses don’t refer to their business in this manner, especially a smug condescending republican who can’t wait to tell you how successful he is.
I'm afraid it is the fate of the majority of humans to have a miserable, horrible existance.
In America, the poor have it much, much better than the vast majority of the poor of the world.
The fact is that the majority of people who did work 50-60 hours a week, as I did, didn't live beneath their means, like I did.
I haven't owned a new car since 1983. I lived in an Apartment throughout the 1990s, investing 30-40K a year from my business while most people I knew were going to Europe or Australia every year and/or buying a new car every 4 years. I took my money out of the market at the end of 1999 because I saw it was a bubble (three months later it tanked). I then bought a house. The house in five years more than doubled to 1.2 million. I sold the house in 2006- just before the bubble burst.
Sorry, its not my fault I stay up late reading the WSJ or that I get up at 600AM to watch CNBC before the market opens. The rest of the slugs I know sleep in and watch some stupid reality show instead of doing their homework on investing.
Let's face it, most people are lazy, self-indulget malcontents. If they want to piss away their time watching mindless TV sitcoms or reality shows than piss on them and they deserve everything that is coming along the pike.
We get what we deserve in life. I accept that, most don't.
50 - 60 hours a week ain’t shit. I used to do that in a “normal” workweek. I’ve had months building new accounts where 12 hours a day six days a week was the minimum to get the job finished. I have friends from law school working at large firms who are on the partnership track who have to sleep in accommodations at the firm because they don’t have time to go home and get back to work the next day. Obviously you don’t have much experience in the workplace or otherwise you would have stated more hours. And not only did you cash out right before the tech stock crash, but you cashed out on the housing bubble! LOL!!! I smell bullshit on this one.
If you don't care to believe it, that is fine. Don't get me wrong, I've taken some losses in life, $12,000 down the tube on Enron, but I had to cash out most of my market holdings to buy the house in 1999.
Am I supposed to feel guilty about my wisdom or good luck? Not a bit.
But we digress, I'm curious about your story Bruce.
No it’s not that you should feel guilty, you put the ball in play and it paid off. But for many people they work their ass off in a situation they have little control over, live within their means, and still cannot get ahead. Life is also often very unfair. I’ve seen people struck down in the prime of life by illness or tragedy and never recover. Does one deserve to get cancer, or have a spouse run out and leave one with the kids? Forget any kind of a social safety net for these situations. And the reason your hearing a lot of griping here is that there are a lot of engineers on this site and they have been hit the hardest by our country’s economic policies. I presently work in the trade show industry. The best machinery and electronics I see at the shows and booths I supervise comes from abroad, either Asia or Europe. It’s just sickening.
And the reason your hearing a lot of griping here is that there are a lot of engineers on this site and they have been hit the hardest by our country’s economic policies.
I was a thin-film engineer. I got laid off in 1989 and for 6 months couldn't find a job. I changed careers, started my own business.
I think the problem is that most people end up working for someone else. One will never get rich working for some one else. They refuse to work for themselves because its too hard.
Take care.
I think you need to read Eric Hoffer's "The True Believer". for you it might be like looking in a mirror.
I don't know what to tell you Bruce. My job feels like work, I only have to work part of the year, but it feels like work.
Sorry I tried to share my success story with the list, given how everyone seemed to be bitching about how bad their lives are.
Whatever.
So what is your story Bruce?
Me I’m just a humble city boy from Chicago’s south side who moved out to the country and bought a small farm to grow my grapes, fruits and veggies. Don‘t need much more than that. And I certainly won’t work for much more than that. I guess that makes me lazy and shiftless.
jbunt
BRussellNM
You cannot post here anymore. I think that it is a requirement that you cannot post if you are a successful, intelligent person, which you obviously are. You have to be an engineer or a scientist of somesort who has failed miserably (economically) and is now pissed off at the entire world. They are all paranoid!!
These jerks are unemployed for five years and go thru all of their savings!! My God!! Rent a small space in a strip shopping center for less than $1,000 month. Purchase less than $10,000 worth of equipment. Start grooming dogs and cats at $20 to $50 each. Work 5 days a week, with 2 helpers and gross over $1,000 per day. You should net $125,000 - $150,000 a year pretax, if you do a good job.
Dog-walkers in L.A. make six-figures.
That includes hazardous duty pay and combat pay.
After we finished selling each other insurance, we can groom each other's cats and dogs.
People lost their homes due to layoffs and medical bills long before the current toxic mortgage craze. And that sort of crap will keep happenning long after the current markets have sorted themselves out. I didn't mean to imply that everybody that bought a home was in it for the money. I meant to say the guy who took out an adjustible teaser rate mortgage and borrowed an additional four hundred grand on his home and is now gonna lose his home is stretching my sympathy button. I'm sorry you are going through this. You did everything right, got a fixed rate mortgage, and s--- happens.
I am there, doing that, got the t-shirt. I was laid off of my air force contractor job at VAFB so the air force can spend their money on the war. Lots of people are being laid off of VAFB. I've accepted an offer to start working again next month. I just have to move. Not what I would have liked but you do what you gotta do. There are people paying a much higher price than I did because of the war. I try to keep some perspective.
You wrote:
"I guess I'm taking your comment personally because those are the things that are slamming me right now. I bought my current house three years ago (very low fixed rate - with a solid bank lender) and seven months later I lost my job."
Hang in there. In the mid-1980s, when oil went bust and I could only earn half of what I had been making, I nearly lost it all. Don't give up, keep trying and be optimistic in any interviews. Eventually, years later, things became much better. Most lives do have some serious downturns, so you are not alone in this experience.
http://home.entouch.net/dmd/Oilcrisis.htm
You wrote:
"I guess I'm taking your comment personally because those are the things that are slamming me right now. I bought my current house three years ago (very low fixed rate - with a solid bank lender) and seven months later I lost my job."
Hang in there. In the mid-1980s, when oil went bust and I could only earn half of what I had been making, I nearly lost it all. Don't give up, keep trying and be optimistic in any interviews. Eventually, years later, things became much better. Most lives do have some serious downturns, so you are not alone in this experience.
http://home.entouch.net/dmd/Oilcrisis.htm