[patientrenter]

[quote=davelj]

…PR, what you’re saying is that you’d rather cut off your nose to spite your face. Which is fine, but obviously I don’t share that view…..

I’m not one to cut off my nose to spite my face.[/quote]

Where’s my nose? I’ve lost my nose!

More seriously, what I am saying is that fairness is a goal just as valid as cost minimization. For some of us, it is less important than cost minimization; for some, more important. Your characterization of my priorities clearly places you in the first category. Obviously, I am in the second category. I accept the variety of views, but I don’t accept that fairness should be swept aside entirely.

I am not prepared to achieve fairness at any cost, but I think the public debate should acknowledge it as an important goal for many of us, and give it serious weight and priority. At the moment, fairness is receiving only a perfunctory acknowledgment, as something that must be deferred. I am suggesting that is a mistake, because it means that, in this first and most significant phase of the unwind, when vast amounts of wealth are being reallocated, the most irresponsible people will benefit the most from the entire bubble and its aftermath. You mentioned, davelj, that many of the well-paid professionals who actively aided and abetted, and profited from, the bubble will see no really large personal pain now. I am saying that part of what we should be doing, as part of a focus on fairness, is to change that.

I am a financial technician in the heart of the financial services industry, and near to some of the companies and issues that we read about every day on the front page of the WSJ. The lesson I personally am learning from the bubble and the unwind, and the way the unwind is being managed, is that reckless behavior, executed carefully to maximize my personal upside and to socialize as much downside as possible, will pay off handsomely.

If I buy a home in the future, I will make sure to do so using government-subsidized loans that require next to no downpayment. As home prices eventually start on their next up cycle, I will buy many homes with little or no money down, signing whatever the mortgage broker says about my living in each of the homes to get the best deal, and when prices eventually become frothy again, I will HELOC the hell out of each one, and walk when prices start to go down again.

And that is just the beginning. Knowing that the whole game is driven by selfish populism, I owe no moral allegiance to the rest of the population. All that scrupulous paying of taxes, regardless of how easily I could avoid some if I tried? Gone.

By demoting fairness to the bottom of the pile, we are allowing a corrosion of trust in our community that may have long-term consequences. I’d rather take my medicine now. My belief is that if we all did that, we’d all be much better off 20 years from now. So I don’t see putting fairness high on the priorities as self-denial or self-mutilation in any way. It’s in our best long-term interest. The biggest obstacle is that very few people think for the long term.

[patientrenter]

[quote=davelj]

…PR, what you’re saying is that you’d rather cut off your nose to spite your face. Which is fine, but obviously I don’t share that view…..

I’m not one to cut off my nose to spite my face.[/quote]

Where’s my nose? I’ve lost my nose!

More seriously, what I am saying is that fairness is a goal just as valid as cost minimization. For some of us, it is less important than cost minimization; for some, more important. Your characterization of my priorities clearly places you in the first category. Obviously, I am in the second category. I accept the variety of views, but I don’t accept that fairness should be swept aside entirely.

I am not prepared to achieve fairness at any cost, but I think the public debate should acknowledge it as an important goal for many of us, and give it serious weight and priority. At the moment, fairness is receiving only a perfunctory acknowledgment, as something that must be deferred. I am suggesting that is a mistake, because it means that, in this first and most significant phase of the unwind, when vast amounts of wealth are being reallocated, the most irresponsible people will benefit the most from the entire bubble and its aftermath. You mentioned, davelj, that many of the well-paid professionals who actively aided and abetted, and profited from, the bubble will see no really large personal pain now. I am saying that part of what we should be doing, as part of a focus on fairness, is to change that.

I am a financial technician in the heart of the financial services industry, and near to some of the companies and issues that we read about every day on the front page of the WSJ. The lesson I personally am learning from the bubble and the unwind, and the way the unwind is being managed, is that reckless behavior, executed carefully to maximize my personal upside and to socialize as much downside as possible, will pay off handsomely.

If I buy a home in the future, I will make sure to do so using government-subsidized loans that require next to no downpayment. As home prices eventually start on their next up cycle, I will buy many homes with little or no money down, signing whatever the mortgage broker says about my living in each of the homes to get the best deal, and when prices eventually become frothy again, I will HELOC the hell out of each one, and walk when prices start to go down again.

And that is just the beginning. Knowing that the whole game is driven by selfish populism, I owe no moral allegiance to the rest of the population. All that scrupulous paying of taxes, regardless of how easily I could avoid some if I tried? Gone.

By demoting fairness to the bottom of the pile, we are allowing a corrosion of trust in our community that may have long-term consequences. I’d rather take my medicine now. My belief is that if we all did that, we’d all be much better off 20 years from now. So I don’t see putting fairness high on the priorities as self-denial or self-mutilation in any way. It’s in our best long-term interest. The biggest obstacle is that very few people think for the long term.

[patientrenter]

[quote=davelj]

…PR, what you’re saying is that you’d rather cut off your nose to spite your face. Which is fine, but obviously I don’t share that view…..

I’m not one to cut off my nose to spite my face.[/quote]

Where’s my nose? I’ve lost my nose!

More seriously, what I am saying is that fairness is a goal just as valid as cost minimization. For some of us, it is less important than cost minimization; for some, more important. Your characterization of my priorities clearly places you in the first category. Obviously, I am in the second category. I accept the variety of views, but I don’t accept that fairness should be swept aside entirely.

I am not prepared to achieve fairness at any cost, but I think the public debate should acknowledge it as an important goal for many of us, and give it serious weight and priority. At the moment, fairness is receiving only a perfunctory acknowledgment, as something that must be deferred. I am suggesting that is a mistake, because it means that, in this first and most significant phase of the unwind, when vast amounts of wealth are being reallocated, the most irresponsible people will benefit the most from the entire bubble and its aftermath. You mentioned, davelj, that many of the well-paid professionals who actively aided and abetted, and profited from, the bubble will see no really large personal pain now. I am saying that part of what we should be doing, as part of a focus on fairness, is to change that.

I am a financial technician in the heart of the financial services industry, and near to some of the companies and issues that we read about every day on the front page of the WSJ. The lesson I personally am learning from the bubble and the unwind, and the way the unwind is being managed, is that reckless behavior, executed carefully to maximize my personal upside and to socialize as much downside as possible, will pay off handsomely.

If I buy a home in the future, I will make sure to do so using government-subsidized loans that require next to no downpayment. As home prices eventually start on their next up cycle, I will buy many homes with little or no money down, signing whatever the mortgage broker says about my living in each of the homes to get the best deal, and when prices eventually become frothy again, I will HELOC the hell out of each one, and walk when prices start to go down again.

And that is just the beginning. Knowing that the whole game is driven by selfish populism, I owe no moral allegiance to the rest of the population. All that scrupulous paying of taxes, regardless of how easily I could avoid some if I tried? Gone.

By demoting fairness to the bottom of the pile, we are allowing a corrosion of trust in our community that may have long-term consequences. I’d rather take my medicine now. My belief is that if we all did that, we’d all be much better off 20 years from now. So I don’t see putting fairness high on the priorities as self-denial or self-mutilation in any way. It’s in our best long-term interest. The biggest obstacle is that very few people think for the long term.

[patientrenter]

[quote=davelj]

…PR, what you’re saying is that you’d rather cut off your nose to spite your face. Which is fine, but obviously I don’t share that view…..

I’m not one to cut off my nose to spite my face.[/quote]

Where’s my nose? I’ve lost my nose!

More seriously, what I am saying is that fairness is a goal just as valid as cost minimization. For some of us, it is less important than cost minimization; for some, more important. Your characterization of my priorities clearly places you in the first category. Obviously, I am in the second category. I accept the variety of views, but I don’t accept that fairness should be swept aside entirely.

I am not prepared to achieve fairness at any cost, but I think the public debate should acknowledge it as an important goal for many of us, and give it serious weight and priority. At the moment, fairness is receiving only a perfunctory acknowledgment, as something that must be deferred. I am suggesting that is a mistake, because it means that, in this first and most significant phase of the unwind, when vast amounts of wealth are being reallocated, the most irresponsible people will benefit the most from the entire bubble and its aftermath. You mentioned, davelj, that many of the well-paid professionals who actively aided and abetted, and profited from, the bubble will see no really large personal pain now. I am saying that part of what we should be doing, as part of a focus on fairness, is to change that.

I am a financial technician in the heart of the financial services industry, and near to some of the companies and issues that we read about every day on the front page of the WSJ. The lesson I personally am learning from the bubble and the unwind, and the way the unwind is being managed, is that reckless behavior, executed carefully to maximize my personal upside and to socialize as much downside as possible, will pay off handsomely.

If I buy a home in the future, I will make sure to do so using government-subsidized loans that require next to no downpayment. As home prices eventually start on their next up cycle, I will buy many homes with little or no money down, signing whatever the mortgage broker says about my living in each of the homes to get the best deal, and when prices eventually become frothy again, I will HELOC the hell out of each one, and walk when prices start to go down again.

And that is just the beginning. Knowing that the whole game is driven by selfish populism, I owe no moral allegiance to the rest of the population. All that scrupulous paying of taxes, regardless of how easily I could avoid some if I tried? Gone.

By demoting fairness to the bottom of the pile, we are allowing a corrosion of trust in our community that may have long-term consequences. I’d rather take my medicine now. My belief is that if we all did that, we’d all be much better off 20 years from now. So I don’t see putting fairness high on the priorities as self-denial or self-mutilation in any way. It’s in our best long-term interest. The biggest obstacle is that very few people think for the long term.

[patientrenter]

[quote=jimklinge]Thanks for the comments!

I’m still hanging on to my guess that superior homes will keep their value better, and I’ll give you a recent example.

I sold a 3,911sf one-story view house in La Costa Oaks, currently pending at $1.3, when the buyer could have walked across the street and bought a 4,714sf two-story REO with no view for $979,900.

Will it last? I think the buyers will keep holding out for the best houses, and step up and buy them – for more money, if needed. The goal for buyers is to get the extras for free, when and where you can.[/quote]

You’re a celebrity, Jim, and a hero to us long-time real estate skeptics.

I agree that prices are holding up for the good properties and the good areas. And they may hold onto much of their elevated price level if the government continues to pour unlimited money into the lending market. But if that torrent of cheap and easy money has to be cut back for any reason, the prices will start to go down more in line with the lower end of the market. That may not happen for the next few months, and maybe not even for the next couple of years, but this is a marathon, not a sprint. There is still a real chance that the govt will have to cut back before they have ignited high inflation, which is the only long term way out of a price drop at the high end.

I wish you the best, and thank you for the entertainment you provide us armchair commenters.

[patientrenter]

[quote=jimklinge]Thanks for the comments!

I’m still hanging on to my guess that superior homes will keep their value better, and I’ll give you a recent example.

I sold a 3,911sf one-story view house in La Costa Oaks, currently pending at $1.3, when the buyer could have walked across the street and bought a 4,714sf two-story REO with no view for $979,900.

Will it last? I think the buyers will keep holding out for the best houses, and step up and buy them – for more money, if needed. The goal for buyers is to get the extras for free, when and where you can.[/quote]

You’re a celebrity, Jim, and a hero to us long-time real estate skeptics.

I agree that prices are holding up for the good properties and the good areas. And they may hold onto much of their elevated price level if the government continues to pour unlimited money into the lending market. But if that torrent of cheap and easy money has to be cut back for any reason, the prices will start to go down more in line with the lower end of the market. That may not happen for the next few months, and maybe not even for the next couple of years, but this is a marathon, not a sprint. There is still a real chance that the govt will have to cut back before they have ignited high inflation, which is the only long term way out of a price drop at the high end.

I wish you the best, and thank you for the entertainment you provide us armchair commenters.

[patientrenter]

[quote=jimklinge]Thanks for the comments!

I’m still hanging on to my guess that superior homes will keep their value better, and I’ll give you a recent example.

I sold a 3,911sf one-story view house in La Costa Oaks, currently pending at $1.3, when the buyer could have walked across the street and bought a 4,714sf two-story REO with no view for $979,900.

Will it last? I think the buyers will keep holding out for the best houses, and step up and buy them – for more money, if needed. The goal for buyers is to get the extras for free, when and where you can.[/quote]

You’re a celebrity, Jim, and a hero to us long-time real estate skeptics.

I agree that prices are holding up for the good properties and the good areas. And they may hold onto much of their elevated price level if the government continues to pour unlimited money into the lending market. But if that torrent of cheap and easy money has to be cut back for any reason, the prices will start to go down more in line with the lower end of the market. That may not happen for the next few months, and maybe not even for the next couple of years, but this is a marathon, not a sprint. There is still a real chance that the govt will have to cut back before they have ignited high inflation, which is the only long term way out of a price drop at the high end.

I wish you the best, and thank you for the entertainment you provide us armchair commenters.

[patientrenter]

[quote=jimklinge]Thanks for the comments!

I’m still hanging on to my guess that superior homes will keep their value better, and I’ll give you a recent example.

I sold a 3,911sf one-story view house in La Costa Oaks, currently pending at $1.3, when the buyer could have walked across the street and bought a 4,714sf two-story REO with no view for $979,900.

Will it last? I think the buyers will keep holding out for the best houses, and step up and buy them – for more money, if needed. The goal for buyers is to get the extras for free, when and where you can.[/quote]

You’re a celebrity, Jim, and a hero to us long-time real estate skeptics.

I agree that prices are holding up for the good properties and the good areas. And they may hold onto much of their elevated price level if the government continues to pour unlimited money into the lending market. But if that torrent of cheap and easy money has to be cut back for any reason, the prices will start to go down more in line with the lower end of the market. That may not happen for the next few months, and maybe not even for the next couple of years, but this is a marathon, not a sprint. There is still a real chance that the govt will have to cut back before they have ignited high inflation, which is the only long term way out of a price drop at the high end.

I wish you the best, and thank you for the entertainment you provide us armchair commenters.

[patientrenter]

[quote=jimklinge]Thanks for the comments!

I’m still hanging on to my guess that superior homes will keep their value better, and I’ll give you a recent example.

I sold a 3,911sf one-story view house in La Costa Oaks, currently pending at $1.3, when the buyer could have walked across the street and bought a 4,714sf two-story REO with no view for $979,900.

Will it last? I think the buyers will keep holding out for the best houses, and step up and buy them – for more money, if needed. The goal for buyers is to get the extras for free, when and where you can.[/quote]

You’re a celebrity, Jim, and a hero to us long-time real estate skeptics.

I agree that prices are holding up for the good properties and the good areas. And they may hold onto much of their elevated price level if the government continues to pour unlimited money into the lending market. But if that torrent of cheap and easy money has to be cut back for any reason, the prices will start to go down more in line with the lower end of the market. That may not happen for the next few months, and maybe not even for the next couple of years, but this is a marathon, not a sprint. There is still a real chance that the govt will have to cut back before they have ignited high inflation, which is the only long term way out of a price drop at the high end.

I wish you the best, and thank you for the entertainment you provide us armchair commenters.

[patientrenter]

[quote=davelj]…My issue as a taxpayer and bank customer is that I want the least costly resolution to these huge problem banks…[/quote]

DaveLJ, for some of us, fairness is one of the most important goals of any resolution of this mess. I would prefer a very fair $15 trillion solution to an unfair $10 trillion solution. I’d prefer a solution that costs $5 trillion dollars more and administers lots more pain to the people who bought assets or goodies liberally on borrowed money or who assisted professionally in reckless lending, and delivers much less pain to the people who were restrained and refused to try to ride leverage to riches.

Otherwise, what’s the point in exercising self-restraint and good sense in the future? It just makes you a loser, an easy mark.

[patientrenter]

[quote=davelj]…My issue as a taxpayer and bank customer is that I want the least costly resolution to these huge problem banks…[/quote]

DaveLJ, for some of us, fairness is one of the most important goals of any resolution of this mess. I would prefer a very fair $15 trillion solution to an unfair $10 trillion solution. I’d prefer a solution that costs $5 trillion dollars more and administers lots more pain to the people who bought assets or goodies liberally on borrowed money or who assisted professionally in reckless lending, and delivers much less pain to the people who were restrained and refused to try to ride leverage to riches.

Otherwise, what’s the point in exercising self-restraint and good sense in the future? It just makes you a loser, an easy mark.

[patientrenter]

[quote=davelj]…My issue as a taxpayer and bank customer is that I want the least costly resolution to these huge problem banks…[/quote]

DaveLJ, for some of us, fairness is one of the most important goals of any resolution of this mess. I would prefer a very fair $15 trillion solution to an unfair $10 trillion solution. I’d prefer a solution that costs $5 trillion dollars more and administers lots more pain to the people who bought assets or goodies liberally on borrowed money or who assisted professionally in reckless lending, and delivers much less pain to the people who were restrained and refused to try to ride leverage to riches.

Otherwise, what’s the point in exercising self-restraint and good sense in the future? It just makes you a loser, an easy mark.

[patientrenter]

[quote=davelj]…My issue as a taxpayer and bank customer is that I want the least costly resolution to these huge problem banks…[/quote]

DaveLJ, for some of us, fairness is one of the most important goals of any resolution of this mess. I would prefer a very fair $15 trillion solution to an unfair $10 trillion solution. I’d prefer a solution that costs $5 trillion dollars more and administers lots more pain to the people who bought assets or goodies liberally on borrowed money or who assisted professionally in reckless lending, and delivers much less pain to the people who were restrained and refused to try to ride leverage to riches.

Otherwise, what’s the point in exercising self-restraint and good sense in the future? It just makes you a loser, an easy mark.

[patientrenter]

[quote=davelj]…My issue as a taxpayer and bank customer is that I want the least costly resolution to these huge problem banks…[/quote]

DaveLJ, for some of us, fairness is one of the most important goals of any resolution of this mess. I would prefer a very fair $15 trillion solution to an unfair $10 trillion solution. I’d prefer a solution that costs $5 trillion dollars more and administers lots more pain to the people who bought assets or goodies liberally on borrowed money or who assisted professionally in reckless lending, and delivers much less pain to the people who were restrained and refused to try to ride leverage to riches.

Otherwise, what’s the point in exercising self-restraint and good sense in the future? It just makes you a loser, an easy mark.

[patientrenter]

LLs are clearly offering special deals in an attempt to prevent the general rental price from going down. But let’s suppose for a second that rents became 20% over-inflated from their supportable levels, as a bleed-in from the 300-400% home price inflation since 1995. Then general rents will have to come down by 20%. How long would that take? If every 2% decrease in the general, public, rental prices is painfully slow, preceded by ever-greater discounts to ever-greater numbers of “special” cases, then it could take many years.

[Author]

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