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powayseller
ParticipantThis is how we did it back in the 1980’s. My husband put the 401(k) money in his company’s fund, the money market option. From there, we did a rollover to our Vanguard account. Easy! I did the rollover every few months.
December 5, 2006 at 10:14 AM in reply to: Loved the house, hate the agent, do I have to use him? #41159ParticipantThanks for the procuring cause comment, although I wish someone would have explained what it is. A quick review yields this:
“The Procuring Cause Guidelines C.A.R. and SDAR adopted in the late fall of 2001 address how to determine which of the brokers involved in a transaction is responsible for its successful completion, and therefore entitled to the commission.”
Procuring cause is an uninterrupted sequence of events that results in a sale. If a realtor feels a buyer unfairly deserted him by purchasing a house via a different agent, the realtor has the burden of proof that he is entitled to the commission.
A list of Factors was developed to help decide these disputes.
The following are in favor of the 1st realtor, the one who was deserted:
* he showed the property which was purchased
* the new realtor never showed that property
* the realtor spent a lot of time generating more buyer interest in that property, discussing financing, etc.Favoring the new realtor are these factors:
* the 1st realtor is the listing agent, and the buyer wants separate representation (in my opinion, NEVER ever let the listing agent represent you – it’s a clear conflict of interest, regardless of what the realtors tell you; they’d rather get the double commission than look out for the buyer’s best interests!)
* buyer is dissatisfied with the 1st realtor for lack of professional conductParticipantDid they close their business or relocate the office? Just asking, because we had a similar story earlier this week, where the company simply moved but an assumption was made they went out of business.
The truss fabricator in the Poway Business Park cleared out the entire lot. The 3 long rows of trussing tables, and a busy yard with about a dozen employees, is gone. All that remains is a large empty lot.
December 5, 2006 at 9:43 AM in reply to: The “Property Tax” Factor and People Just Don’t Care what Things “Really” Cost #41153Participantnice post, cowboy.
The amortization is not a sock-it-to-you scheme. It’s just a fact of how saving and interest accrual works, in your favor when you save and against you when you borrow.
The interest is simply calculated from your principal, so as your principal is reduced, so is your interest payment. If you want to pay less interest, get a smaller loan or a shorter loan period. The lender has to get paid for lending you the money. I am earning 5.5% in my CD because there’s a guy paying 8% on his HELOC.
When housing prices fall back to $250K median, and you get a 30 year loan at 6%, your total interest paid over 30 years is more than you paid for the house. It’s $290,000.
Likewise, when you save money your interest paid to you grows each month, so that by your retirement hopefully, the interest you earn is larger than the money you used to open your account.
ParticipantWe first went off the gold standard because there wasn’t enough gold to buy all the stuff that we needed and were making. Our productivity jumped drastically with the industrial age, but the amount of gold in circulation just did not keep up. How is it even feasible that all the money in the world today could be replaced by gold? I guess if it happened, each oz of gold would cost tens of thousands of dollars? Then someone would need to make tiny slivers of gold to buy cheaper items like bread or shoes.
Participantjg, here’s a quote from The Dollar Crisis, which explains that all the money created by the FCBs entered the US as high powered money into our banking system, multiplying many times over, and creating the .com and housing bubbles.
“…regardless of what type of asset was initially purchased with these funds [inflows into the US], eventually, most of that capital worked its way into American banks. For example, if the capital inflows were used to buy government bonds, the government spent the proceeds on goods and services, and the providers of those services deposited the payments they received from the government into their bank accounts. The same is true regardless of whether the funds coming into the country were used to buy corporate bonds, stocks, or any other kind of asset. Unless the money was hidden under a mattress or destroyed, most of it would have entered the banking system as deposts; and deposits make up most of the money supply.
….When funds from abroad enter a banking system as deposts, they are not re-lent only once. The original amount that is lent will be redeposited and then re-lent and redeposited numerous times. …Therefore, the $3 tril in capital inflows after 1983 did much more than finance an additional $3 tril worth of debt. Those inflows were deposited, lent out, redeposited, and re-lent mulitple times. In that way, they caused the U.s. money supply to expand, fueling the bubble economy that emerged in the the U.S in the 2nd half of the 1990s’.”
That money created the Nasdaq bubble, too. What happened is that the gov’t ran a surplus, so the FCBs couldn’t buy enough Treasuries with their dollars, and had to buy other assets instead. In hindsight, we would not have had the .com or housing bubbles if the government would have continued running a deficit and issuing sufficient Treasuries to absorb all those dollars. Another solution would be to stop printing so goddamn much money!
Duncan continues, “The investments in corporate bonds facilitated the misallocation of capital that is now laying low the dot.coms and the telecommunication companies, among others. And the investments in agency debt have helped fuel the boom in U.S. property prices, that has allowed the U.S. consumer to extract additional equity through refinancing his home in order to keep spending more than he earns”.
French economist Jacques Rueff explained our dollar recycling program back in 1961, before it even existed, as he saw what would happen once we went off the gold standard:
” The functioning of the international monetary system was thus reduced to a childish game in which, after each round, the winners return their marbles to the losers”. – Rueff
In other words, the producer countries of Asia sell us their stuff, and then return to us the money we pay them. It’s a ridiculous sytem!
ParticipantI won’t interfere with your conversation with Wiley. But I’d like to elaborate on my points made earlier.
The Federal Flow of Funds Credit Market Debt chart shows that US Treasury debt has risen steadily, but it is not the largest source of credit market debt.
As of Q2 2006, Table L.1 shows these are the largest categories of debt outstanding.
Household sector $ 12,310 trillion
Non-fin. corporate 6,600 tril
Federal government $ 4,700 Trillion
mortgage pools 3,813 trillion
ABS issuers 3,228 trillion
GSE 2,686 trilThe household sector’s credit market debt is the 2nd heaviest borrower in the credit markets after the financial sector (which includes mortgage pools, ABS, GSEs, and other categories).
Mortgage pools are pools of mortgage securities issued by one of the GSEs, and have brought a lot of money into our housing market, thus pushing up prices. They’ve grown from 4% of GDP in 1980 to 29% of GDP in early 2002.
ABS issuers have seen the greatest explosion of debt. 12 years after their introduction, their debt is 4x greater than that of commercial banks. That category includes credit cards, auto loans, equipment leases, corporate loans, mortgages (esp. sub-prime home equity loans), and trade receivables.
Pension funds and retirement accounts, which hold a lot of the ABS debt, have taken on the risk of default by borrowers of this debt. Expect to see a lot of pension and retirement account mutual funds take big losses when this credit bubble implodes, further burdening corporations and governments, and reshaping retirements for millions of Americans.
If the US budget deficit or credit demand is reduced, where will the foreigners put their dollars? The foreigners need a sufficient amount of US debt issue to recycle their dollars.
December 4, 2006 at 6:12 PM in reply to: Loved the house, hate the agent, do I have to use him? #41124ParticipantI was waiting for one of our realtors to answer this question, but they didn’t, so I will do so.
Unless you signed a contract for an agent to represent you as your buyer’s agent, you can switch agents at any time. This is something that realtors probably don’t want you to know about. Imagine the disappointment of a realtor who showed you 40 homes, just to lose your sale to another agent you picked up along the way.
Of course, if one agent has worked with you, it’s only ethical that you give him the business of the sale, in my opinion.
Beware also of low fee agents who cut costs by not taking you to showings. They try to tell you that you don’t need to be shown any homes. “Just look at them over the internet” is convenient for the agent, but doesn’t give you any idea about what the homes truly look like. Make sure your agent takes the time to show you lots and lots of homes, maybe 50-100. Only then will you know a good deal when you spot it.
ParticipantThe mortgage business is shrinking. Home sales are down 30% from last year, so the number of purchase applications has taken a big hit. Refinances are also down, but I don’t know how much.
On Ben’s blog today, I read that ““According to the new 3Q issue of the Quarterly Data Report, loan production fell 11% in the third quarter. And according to the Alternative Products Quarterly Data Report, jumbo loan production fell 21%.””
I know 2 loan officers, one who’s been in business over 20 years and has a client base, and both have lower volume now than last year. I don’t know more details, as they don’t want to talk about it.
ParticipantThanks, Wiley! I also think bars are very good for people buying in larger quantities. Does anyone know anything about buying bars? Do you just go by the weight, or do you have to make sure that the bars are stamped and have a chain of custody or authentication?
Participantjg, your college textbook would have told you that goverments actually spend the money they get when they issue bonds.
The U.S. Treasury does not put all those dollars it gets from selling Treasuries into a big vault, out of circulation, “on ice”. They spend it.
ParticipantWould you buy gold bars, the American Gold Eagle coin, what? How do you know the company is selling you the real stuff?
ParticipantAs far as Treasury money, I’m by no means an expert but doesn’t the government spend all the money it gets from selling Treasury bills and bonds? I don’t understand how any money that goes somewhere just sits idle. Banks, governments, they all spend the money they get. Banks lend it, but governments use it to run their government and pay the interest on past debt.
ParticipantOne of our Federal Reserve Chairmen?
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