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rankandfile
ParticipantNP, Lamoneguy. The main point I was trying to express is that the middle class is getting squeezed from more than one direction, and not just from housing. I believe that, next to housing, healthcare would probably be the next biggest ongoing expenditure for many middle class families.
I am of the belief that the middle class is the most important class in determining the health of an economy. Yes, the wealthy invest in more profit-making ventures and create jobs, and the poor provide much needed services and spend most of their earnings on consumable goods (I’m over-generalizing here). However, the middle class resemblances both the upper and lower classes at times. They often earn enough to save and/or invest it, yet they also are great consumers.
What I worry about most is that the middle class will no longer able to consume at current levels and help keep this economy afloat. I also think we are staying afloat on borrowed time as it is, since much of the consumption over the past 5 years or so can be directly or indirectly attributed to unsubstantiated run-ups in home prices and cheap, easy money in the form of loans.
ParticipantIt all depends on what skills you have and how much you are willing to invest to get the thing going. I started in a business that I worked in for almost 10 years, so I had some good experience and a good network. Look at things like start-up costs such as equipment, hardware, office real estate, etc.
I would highly recommend starting off small and consider trying a virtual office. The virtual office concept might seem foreign to some, but it can be a great (and inexpensive) way to conduct business if you do it right.
ParticipantI agree with everything written so far and would just like to add a comment about the medical costs. Medical costs aren’t just for the elderly anymore. Anyone with children, or even without children for that matter, can attest to the high costs for medical insurance. Not that this is the reason for the middle class’s debt woes, but it certainly doesn’t help. The well-to-do can afford insurance payments on a PPO. The poor have Medicare/Medicaid, and the illegal immigrants, well they just get free care. It’s the middle class family that ends up shouldering the lion’s share of high medical costs. Don’t forget about the frivelous lawsuits and malpractice insurance, either.
ParticipantThe Fed will likely pause this time around. I have read that the fact they are considering a pause is quite telling. It is saying that the economy is already in some trouble and they don’t need to expedite it. Like a house of cards that is already falling down…they don’t need to blow on it because it will fall under its own weight.
My gut feeling is that the Fed needs to make another quarter point raise and see how the rest of the quarter plays out. I think they tend to err on the side of gradual change. Conversely, I have the attitude that if something is broke, it needs to be fixed. And long term inflation is a much bigger problem than short-term economic progress. Another quarter point hike will help to put our economy on a more steady path, one that is not in inflationary mode. Sometimes the worst tasting medicine is also the best for you.
ParticipantSD Realtor, thanks for that insight. I figured they had some sort of plan in place…at least on paper. This reminds me of the sewer spills that frequently occur in San Diego. There are preventive maintenance steps, and predictive deterioration models that can be performed to gauge how bad pipes are and when they will need to be replaced. If there is no data for this, a replacement schedule is implemented whereby x feet of pipe are methodically replaced every so often. Other methods include in situ repairs such as re-lining the pipes and filling the voids. The main point is that I don’t think that San Diego can just keep raising the sewer rates to compensate for the deteriorating pipes. Ongoing maintenance and replacement should already be factored into the monthly sewer rates. In other words, the City has a financial incentive to proactively maintain their pipes because letting them go to waste and replacing them is much more expensive. The oil companies, on the other hand, just increase the cost per barrel to offset any lack of foresight on their part.
ParticipantThey are fully aware that they SHOULD have been on a routine maintenance and repair cycle. Yes, maybe inspections are difficult, but they should’ve just prepared a replacement plan for the pipes after so many years of service, whether it was corroded or not. This is the proactive way of doing things and it is much less expensive in the long run. Do you personally inspect every shingle in your roof to see if there’s a leak under it? It is simply replaced after it’s typical service life. Same goes for pipes, roads, bridges, etc.
What’s their incentive to spend ongoing funds to maintain these things when they can just let them go to waste, shut down a portion of operations, and charge an arm and a leg for oil while they fix the problem? After all is said and done, I’d bet that it is actually more profitable for them to let the pipes rot and overcharge on oil than to keep them maintained and the oil flowing.
ParticipantWhere can one get information about expireds, cancelleds, or withdrawns? Are these listed in online MLS databases, or is it considered special info to which only certain people have access?
ParticipantVCJIM- I remember hearing about leasing a home to a business a while back. I think I will look into that some more.
PerryChase- Thanks for the tax info. If you have time and are up to it, maybe you can start a thread related to tax questions….like the thread devoted to mortgage questions. What are some good resources for novices like me to learn about some of the key taxes that come into play for home ownership, business leasing, or even trusts? I’d definitely like to research this some more.
ParticipantThat would definitely be a downer. I thought of that and it’s part of the reason why I incorporated in Nevada (I understand it is more difficult to pierce the corporate veil of a business there).
August 6, 2006 at 7:25 AM in reply to: San Diego’s Big Investment in Low Wage Jobs, or Reality Check for Sellers #30910ParticipantI second that, Powayseller. The only thing I might add is that the $600K homes may need to come down even further than $300K…unless wages are increased to an adequate level.
Your point is so banal, yet so sagacious. Middle class San Diegans simply cannot afford to live here without the need for some risky, exotic loan vehicle. The sad part is that the media (the UT in particular) had given warnings in years’ past about San Diego’s dwindling middle class. It’s funny how we choose to have selective memory with certain things.
ParticipantThe reason things are so complicated is because there is money to be made in it. A form of job security if you will. Like the government worker that overcomplicates their once simple job functions to the point where only they can do it. Why else would we have a 40,000+ page (and growing) tax code? Yet, as complicated as our idiotic tax code is, there are still programs out there that can walk an average Joe through their taxes for about $50.
ParticipantThe reason things are so complicated is because there is money to be made in it. A form of job security if you will. Like the government worker that overcomplicates their once simple job functions to the point where only they can do it. Why else would we have a 40,000+ page (and growing) tax code? Yet, as complicated as our idiotic tax code is, there are still programs out there that can walk an average Joe through their taxes for about $50.
ParticipantThe reason things are so complicated is because there is money to be made in it. A form of job security if you will. Like the government worker that overcomplicates their once simple job functions to the point where only they can do it. Why else would we have a 40,000+ page (and growing) tax code? Yet, as complicated as our idiotic tax code is, there are still programs out there that can walk an average Joe through their taxes for about $50.
ParticipantI don’t have any hard data to refute your figures, but I’d guess that the $90K/year figure might be either too high, or few and far between…ie, not too many people are able to earn that. I think that a lot of those high salary positions came and went during the dot com era. Those high rates are also a big reason why companies are leaving California and the US in general. There are MANY highly-skilled programmers in India, China, and Eastern Europe that will produce a similar product for a fraction of the cost.
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