|
Tal Tales
|
|
I think a storm is coming. I’m not any sort of economist, but recent events make me suspect that our economy is not in the best shape. Credit markets are still frozen, and things are a bit bleak. But still, that’s not the worst part. As has been pointed out by others, in the next 20-30 years, we are going to be facing an incredibly huge problem in the fact that the government is going to be bankrupt. We’re not going to be able to pay for Social Security, Medicare, and all of our other priorities much longer. It’s just not going to be possible with any rational projection of future growth.
So I think that bad stuff is coming down the pipe, and I don’t think there’s going to be any easy solution. And, as always seems to be the case when bad stuff hits, I think the people who are going to be in most danger of their lives and health will be the poor.
Now, I vary between libertarian, enviro-hippie, and filthy liberal, but in general, I am willing to accept that one legitimate role of government is to help keep people who are at the bottom of the economic ladder from starving or freezing to death. It seems to me as though providing a last net to try to catch folks who are falling fast is one part of a civilized society. And yes, I know that requires the government taking money away from folks and giving it to others who the first folks might not otherwise have given it to. I’m libertarian enough that that makes me uncomfortable, and liberal enough that I think that sometimes it may be justifiable anyway. I know it's strange to suggest that we need the government to help the poor through a crisis brought on by entitlement programs intended to help the poor--but I wouldn't have had nearly as much a problem with those entitlement programs in the first place if we had honestly acknowledged their cost and made the sacrifices needed to pay for them (or avoided them and allowed more economic freedom in the first place, maybe, but I digress.)
If we do indeed get smacked by a serious and ongoing economic problem, there are going to be a lot of people who will need help. I think that helping them would be a good idea; maybe something like the WPA. If we can give folks work while shoring up national infrastructure, then maybe that would be good in the end. However, something like that is going to be very, very expensive, and someone’s going to have to pay for it.
If we’re in an economic crisis brought about by irresponsible acquisition of debt, then I don’t see how borrowing huge sums of money to pay for a project like that is going to be effective in getting out from under the problem. Thus, the money will have to come from a combination of increased taxes and reductions in spending elsewhere. It will require substantial sacrifice on the part of the American people, in other words, and we’ll need a leader who can call for that sacrifice and persuade us to make it.
And I don’t think Obama will do that.
I think he’s capable of it. I admire his persuasive speaking; it’s one of the things I think best qualifies him to be President. But based on his enthusiastic support of the recent bailout bill, his statements about how we need to help keep folks who took loans they couldn’t afford from being foreclosed on, and his difficulty in identifying any area of his plan that he would be willing to cut if forced to do so by financial constraints, I don’t know if he can do it. If we hit really hard times, would President Obama be willing to ask people in the middle class (heck, even the lower middle class) to share in the sacrifice to help keep Americans alive during the storm? Would he be willing to raise taxes across the board—not just on the wealthy, but on everyone? Would he be willing to cut not only corporate welfare, but also federal science funding?
As much as I like Obama, and in general like his policies, I’m not convinced by his stances so far that he would be willing to call for real sacrifice from all Americans if it came to it. I fear that if the time came when we all had to take the hit to help protect the weakest and most vulnerable among us, Obama would not make the right call. I have no doubt that he would spend money to help the poor, but I think he would choose to get it from borrowing—and I don’t think we can afford to do that any more.
I’m not at all convinced that McCain would be any better about this, and he’d be even less persuasive if he did make the call. I could maybe—maybe—believe he would be slightly more willing to ask all Americans, wealthy and not, to share the load, but I don’t remember him showing any resistance to the bailout either.
I’ll probably still vote for Obama, because I think that he presents other good reasons to vote for him. But I am not convinced that when the bad stuff comes, he’ll be able to make himself unpopular by saying it’s time for us all to take the hit so that we can protect those who are the most vulnerable among us.
|
|
|
|
|
I wrote this in a moment of irrational grumpiness about the proposed bailout.
A letter to Congress
September 22, 2008
How dare you?
How dare you propose that we shield these institutions from the consequences of their bad decisions?
How dare you even consider abusing the trust placed in you by your constituents--to use the resources they provide to serve the best public interest--by making sure that investors don't have to pay their gambling debts?
We are faced with a financial crisis of nearly unprecedented magnitude. There is much investigation yet to be done, and I have no doubt that future economists and historians will produce many theses and dissertations on its causes and effects. What is becoming clear, though, is that our banks are crippled by the fact that they are in possession of assets whose value is largely unknown, but increasingly doubtful. These assets were purchased by these banks in the hopes that they could make money from them. That's investment--and investment is always a gamble.
Folks, gambles don't always pay off. And when you make a bad bet, you lose your money. That's the way it works. That's why you think carefully before you invest, do your research, and take risks that you can safely take on. Hopefully, your bets pay off more often than they fail.
What kind of message are you sending a company when you make sure that they don't have to face the consequences for bad decisions?
We've been told that we can't allow these companies to fail, that they are too important. Well, when we have individual companies which are too important to our economy to be allowed to fail--when we have to rescue them, no matter what sort of stupid, reckless bets they have made--then I say there is something terribly wrong with that economy. I say that an economy built on that foundation cannot, and should not, be allowed to continue. If the price of keeping this economy standing in its current form is to shift hundreds of billions of dollars from taxpaying citizens to the institutions which made bad bets so that they can make more bets in the future, then I say LET THEM FALL.
There are many Americans who made some very poor decisions about buying homes. That's a sad and terrible thing, and it's going to cause a lot of pain. What, if anything, to do about that is another story, and one we will have to deal with. My gut says that if you lie about your income to take out a loan you can't pay back to buy a house, then you are going to lose that house. If you take out a loan which you know you can't repay, assuming that the value of your house will rise in time to sell it and make a profit, then guess what? You just made an investment, and a risky one at that. You made a bet, and you lost. Personal responsibility for bad decisions is just as important as corporate responsibility. But those Americans are already paying for their decisions. Millions of households are in turmoil because they are losing their homes. They're facing that loss already. And now the time has come for the banks which made those loans without seriously investigating whether the borrower could pay--and the institutions which encouraged that lending--and the institutions who bought those packaged loans hoping to profit from them--to face up to the fact that they, too, made a bad bet. They made a bad investment.
And you are even considering taking money from the citizens of this country to make sure that they don't have to pay for their bad bet?
How dare you?
We need to deal with this problem in its real form, and that is that we are living beyond our means. For a decade, we've been borrowing from the future. "Look at the growth," we're told. "Look at the wonderful prosperity!"
Folks, it's not growth. It's not growth, and it's not prosperity, when what you're doing is building houses on air and debt. For a decade, we've been climbing higher and higher on a ladder behind a curtain.. Well, now the curtain has been pulled away, and guess what? Our ladder is made of drinking straws and chewing gum. America just got the first call from the debt collectors. It's time to pay up.
We have been told stories about the legendary "greatest generation". We've lionized them for their courage. We honor them because, when we faced great danger, they stood up and put themselves on the line. They made a sacrifice to fix a problem with the world.
We have a problem now. There are several ways to deal with it, some of which seem to require little cost to us. But here's the problem: those methods are tricks. Illusions. Lies. Those methods are the same sort of false solutions which led us to the problem we face today. They simply shift the burden to those who will come after us.
The time has come to stand up. The time has come for us to make a sacrifice. Do we have the courage? Do we have the ability to take the hit, so that our descendants don't have to? Can we make the sacrifice, and face the consequences of our irresponsibility--and that of those who came before us? Do we have that courage?
Or will we make sure that our grandchilden curse our names, as a generation of fools and cowards, who saw the problem and hid our faces in fear and shame?
|
|
|
|
|
The rehab continues.
I wanted to put in one of those pop-up stoppers in the working bathtub (the trip lever kind which was in there didn't work very well). We removed the trip lever without incident, and I went out and bought a dumbbell wrench to remove the drain itself. That worked quite nicely, so I put in the popup drain. Then my father-in-law crawled under the house to check the new drain for leaks while I ran some water down it.
Uh-oh. Leaks abounding...but not, as it turns out, from the new drain.
The overflow and drain from the tub were beautiful brass piping, intact and lovely. However, somewhere along the line, someone had just kind of jammed some PVC drain pipe into the outflow of that brass assembly. They put some sort of cement in it, but in the course of pulling out that drain, I had apparently put enough (i.e. any) strain on it to break that cement, and it was now leaking.
So out we go to the hardware store. We buy an ABS overflow/drain assembly, a few elbows, a male threaded ABS end, and a female threaded PVC end. We put in the new ABS drain, cement on the male ABS thread, screw on the female PVC coupling, and attach that PVC to the existing PVC which then goes down to the cast-iron drainpipe. And, miracle of miracles--it works!
My father-in-law has poured a thin layer of leveling concrete over the repaired and sealed plywood floor in the other bathroom. We will apply slate tile onto that concrete. Unfortunately, with the tile, it is very likely that the door of the bathroom will no longer clear the floor. We'll have to either shave down the bottom of the door and insert a new block of wood into it (it's hollow-core), or get a new solid interior door and shave it down a bit.
I've finished painting all of the rooms.
I'm tired.
|
|
|
|
|
So we bought a house.
I've posted the story of the purchase elsewhere; it was a short sale, and those make full novels on their own. But in the end, we got it.
Now we discover what "fixer" means.
Background: while I am not physically incompetent, I have very little experience with tools. I know a hammer from a set of pliers, but (until very recently) I couldn't have identified a router unless it passed network packets. However, my father-in-law (with whom I get along very well) is an electrician, and knows a fair bit of many other construction-related trades, and expressed willingness to help. So when we saw the house we now own advertised as a "fixer", we thought we'd check it out.
The inspection revealed some issues of concern; needs a new electrical panel, some wiring work, a leaky drain line, and such, but nothing major. The bones of the house--foundation, framing, and roof--are all excellent. A quick look-through by father-in-law revealed no areas beyond our capacity, so we took the gamble.
After closing, we left ourselves two weeks and several thousand dollars to do needed rehab work. Painting came first, and I learned to do a decent amateur job of that. Then the fun begins.
The toiler over that leaky drain doesn't actually seem to be bolted to the floor; it slides sideways at least three inches. Take it out, get new toilet, put on a double-thick wax ring (the cast-iron drain flange is a bit below floor level) and bolt down the new toilet. No more leaky drain line. Yay.
I have now learned to remove and install toilets.
On to the other bathroom. Look at that bathroom wall...kind of crumbly and blistered there near the bottom...hmm. And the sink drain--wait, what is THAT? They've just taped the sink outflow to the drainpipe? They don't actually connect. And that supply valve is leaky.
Take the sink out. Take the toilet out. Definitely water damage in the drywall.
Rip out a big piece of drywall (damp) and take a look.
Good news: The supply pipes (copper) are intact--actually, in great shape, except for that supply valve. Shut off the water, cut them and cap them. We'll install new supply valves later.
I have now learned how to cut and solder copper plumbing.
Bad news: drainpipe in wall is cast-iron. We can just cut out the section where the sink connects and replace it with ABS, right? Sure.
Oh wait. Is that a crack?
Yep. The cast-iron drainpipe is cracked, down to the floor. Go into the crawlspace. It's cracked down to an elbow fitting. Cut out the drainpupe and replace with ABS.
I have now learned to cut cast-iron with a sawzall. Heck, I have learned what a sawzall IS. And I have cemented ABS drain lines, and connected them to cast iron.
Cut new drywall. Put new drywall over the big hole. Tape and mud it in place.
I have now learned a bit of drywall repair.
Hey, that tile in the floor is loose. Lift it up.
There's water underneath. CRAP.
Pull up tiles. They're cemented onto what looks like linoleum, and it's definitely water-damaged around where the sink was. Pull up linoleum--it's sitting on 1/2 inch plywood, which is smelly and mildewey for about a foot and a half around where the sink was. Cut into that and pull it up too, praying that the actual floor is not rotten.
I have now learned how to adjust the depth of cut on a circular saw and use a prybar to rip up flooring.
The floorboards--the actual 1x4s sitting on the long joists which are attached to the foundation--are discolored and slightly damp, but still feel very solid, and I can't punch into them with a screwdriver. We decide to treat them with borax (kill the mildew) and dry them out, then put down new flooring.
And that's where we are now. I've learned a lot, and the fact that my father-in-law (and a friend) are donating the expertise and labor has saved us several thousand dollars, I figure.
I'm well aware that I have learned the BASICS of all of these things, not enough to do good work on my own. But still, I'm learning a bit about how houses are put together, and that doing these kinds of things is something I can learn how to do, with some time and a friendly teacher. It's even kind of fun.
Whee!
|
|
|
|
|
We are (hopefully) going to get word on whether we will be buying a house sometime this week. With that in mind, I am considering other changes I might make. I have been pretty happy with a lot of changes I've seen in myself lately; I have some new hobbies (classical guitar, archery) which I like a lot. However, there is one area I'd like to change--commuting to work.
Even if we get our new place, I'll still be about 6 miles away, which is too far to walk for me. We'll have better access to the local bus and light rail, which would work well except that I teach night classes two days a week and the trains don't run at night.
Biking is a definite possibility, except that the route I would take has a fair number of blind curves, and doing that at night on a bike is a bit scary.
Driving is, of course, an option, but gas is $4 a gallon here now.
I like LF's motorized bike option, but I am also considering a scooter...specifically, the Genuine Scooter Company's Buddy and Yamaha's Vino. Both are 125cc scooters, which should be capable of at least 45 mph (even with someone as heavy as me on them) while getting 80-100 mpg. They're both around $2500 new.
Aside from the whole "look even more like a complete doofus than I already do" factor, does anyone have any advice on the issue? I have never ridden a motorcycle or scooter before--how difficult is it? How horribly unsafe?
|
|
|
|
|
Welcome to the Suppository, home of the eloquent and informative Asylum Blogs!
To make a blog for yourself, DON'T try to make a new thread in here. Don't click on the "New Thread" button. No! Don't! OH, GOD, NO!
Dammit, you did it anyway. You should be right at home here.
Well, you found out that it doesn't work like a regular forum. To make a blog, click on the "Options" button up at the top of the screen. Over on the far right, you should see a "Blog CP" button--click on that. From here, you can make blog entries, name your blog, etc. etc. When you make a new blog entry, it will show up as a thread here in the Suppository. Other people can then see, read, ponder, object to, consider, be persuaded by, and ultimately found religions based on your blog post. They can also (should you deign to permit it) register their own replies to your wisdom as comments.
Have fun.
|
|
|
|
|
We are currently in the process of applying for a mortgage and trying to buy a house. Here in north San Diego county, home prices have been skyrocketing for years; between about 2000 and 2006, they went absolutely nuts. When I applied for my current job, one of the things I asked the hiring committee was "Where the heck do you people live?"
Although we are fine with renting, we have always hoped to someday have a home of our own. When we moved here is 2006, the idea of applying for one of these interest-only, ballooning, insanely risky mortgages did occur to us. We have excellent credit (although little or no down payment), and given how freely they were being tossed around, I have no doubt we could have gotten one. However, they seemed like an insane risk--taking on debt far beyond your means entails betting everything on home prices continuing to skyrocket or major jumps in income, and we were not willing to bet on either of those. So we found a nice place and rented, figuring that home prices couldn't keep doing this forever.
Now that the housing bubble has collapsed, San Diego county has been one of the worst-hit places in the country. There are substantial neighborhoods around here where huge numbers of homes are undergoing foreclosure or short sales, and prices are plummeting, especially at the low end of the market. Suddenly, there are lots of houses in our reach, and our credit is good enough that lenders are willing to talk to us even though we have very little cash available. We've got a bid on a short sale right now.
Given all this, I've been thinking a lot about the mortgage crisis, and the proper response of government to it. I don't wish harm on anyone, and I don't specifically want to see anyone lose their homes...but I am not sure I think that massive government intervention is appropriate here. I certainly have a great deal of sympathy for those who are victims of predatory lending, or who were deceived as to the nature of their loans. Although it is the buyer's responsibility to understand the terms of the loan, it is also the lender's job to be upfront and clear about them. In cases where people were deceived, I can see action taken against the lender.
In many other cases, though, when people either neglected to take the time and effort to understand the loan terms or chose to accept the risk, although I feel bad for the difficulties they will face, I do not think that governmentally-driven modifications to their loans is appropriate. If you are buying a house you can't afford, on the assumption that it will rise in value and you will be able to make a profit or refinance it, then you have bought an investment, and a risky one at that. Investments always carry the risk of loss.
I know that losing one's house feels very different from having a stock investment go south; homes represent shelter and stability. But buying a home as a home usually entails making sure that you can afford what you buy--after all, if it is going to represent shelter and stability, it doesn't make sense to buy something you are sure to lose unless things turn out just right! If you buy a home not as a home, but as an investment, then it seems dishonest (when the investment goes bad) to portray the consequences as "losing one's home".
There is also the issue of public risk and private profit. When the government insulates people from their bad decisions, that implies some public assumption of the risk of an individual's investments. If a person makes a good investment, though, there is great outcry at the notion of taxing the profits from the good investment.
Likewise, unless those buying houses they could not afford intend to offer up a substantial percentage of the profits from the sale when they do manage to have it come out well, it seems illegitimate to expect help avoiding the loss if it goes badly. It is not fair to expect private profit, but public risk.
I know a couple who bought a house in the Los Angeles area during the middle of the housing boom. They made good money, and could actually afford some of the homes they were looking for. However, they chose to buy a very expensive home (about $200k beyond what they could afford with a traditional fixed-rate mortgage) by taking on a low-introductory, ballooning loan. As it turns out, they ended up selling the home for a decent profit about six months before the collapse started, so they never ran into the balloon on the mortgage (which would have bankrupted them). That's fine--they bet well, and while I wish they had not been involved in the market bubble which drove prices out of most folks' reach for so long, I don't really hold it against them. They had the money to make the bet, and it paid off for them; that's how the market works.
But if they had gotten stuck and lost the home, while I would have felt very bad for them, and would have welcomed them to stay with us while they found other housing--I would not have pushed for legislation to keep them in their house at your and my expense, or by forcing modification of the loan terms.
I end up with mixed feelings here--I don't want to see people forced out of their homes, but I suspect that the cost of government intervention may be unsustainably high.
On the other hand, I don't favor any bailout of the lenders who made the loans, or investors who bought them, either (again, unless fraud or deception can be proven). Assessing risk is the job of those making loans and buying them as investments; if they have failed to do so properly, then I see no reason why they should not take the hit. To do otherwise would be to reward them for a poor business decision.
But I know nothing of economics, as I have said, and I am sure there are many factors I have not considered. That's why I posted this here--so y'all can show me where I have this wrong. Please help me out. 
|
|
|
|
|
It's been a weird couple of weeks. At the end of January, while driving along the freeway (taking kids to school), my Jetta died. Turns out the timing belt slipped or snapped or some such, and since it's an interference engine, it trashed the engine. The ignition coil and some other electronics are dead, too. Estimated repair: $3200. Value of car: About $1000 if it were running, and I strongly suspect it will have other problems soon. I'm selling it to one of the mechanics at the shop for a few hundred dollars.
So we had to shop for a replacement. Decided to move up to a minivan, found a good one from a private seller, had it inspected. It's in good shape, and the price is reasonable. Made an offer accepted, paid cash. We knew the registration was expired, and we'd have to renew, so I take it to AAA to do the paperwork.
Of course it's not simple.
Here's the situation, which took me a few days to figure out. The person selling was not the owner listed on the title. That person--the titled owner--had sold the car to a woman, and signed the title--but she had not signed it in acceptance. That woman was a member of the family of the man who sold it to me. He gave me the title (signed by the original owner) and a blank bill of sale, signed by the original owner. Basically, the family selling it to me had never officially taken possession of the car.
According to AAA, that wouldn't have been a problem--except that the woman to whom to original owner sold it *had* accepted legal liability. Thus, while she had never signed the title, there was a record of her attached to the car, and the bill of sale signed by the original owner was invalid.
I had to get the man who sold it to me to obtain a bill of sale from the original owner to his relative, and one for his relative to me. Which, to his credit, he did within a day. He wasn't trying to scam me, he just didn't realize that his female relative had taken liability for the car.
In the end, it just cost us a little time and stress, and we had to pay an extra transfer fee ($15). But now it's ours, and we like it.
We're also shopping for a home loan, as we have found a very nice house which we would like to buy. There are foreclosures and homes for sale *everywhere* around here, and most are sitting on the market for 60+ days (the one we like has been out there since September, with no offers). Combine that with low interest rates, and I think things are as good as they're going to get--or almost so--and it's the right time to buy a house if we can get a loan. No adjustables, no weird loans--30-year fixed all the way for us. Now we'll see if anyone is willing to lend us the money.
So things are interesting. The stress of the car is done, which is good--but house shopping and loan shopping are nervewracking. Still, we might end up with a house for a bargain. Then we get to enjoy toilets failing and it being *our* job to fix them.
|
|
|
|
|
Hypocrisy = failing to live up to one's stated ideals
Hippocracy = political rule by horses
Just something I've noticed recently.
|
|
|
|
|
At the moment, I seem to be in an expansion mode. Not in terms of gaining weight, but in that I seem to be hungering for new ideas and new knowledge. Example: I've signed up (no pun intended) for online ASL courses. I've always been interested in sign language, and always wanted to learn it, but it's only now that I've gotten things together to actually start.
I know that ASL should really be learned from a competent instructor; without feedback, I may be signing very badly. My college offers good courses, but I just can't fit them it with my own work and family life. So I'll just work on getting some vocabulary and receptive understanding, and go from there.
I'm trying to learn classical guitar as well, although my practicing has decreased a lot since mid-semester. I'm also getting solid plans together for how to tackle some old stuff which has been hanging over my head since I got my degree. There is a lot of data from my last experiments that never got published, and I don't feel like I can look my advisor in the face until it is done. I know it sounds silly, but it's a significant mental burden. I was a pretty lousy grad student, and actually getting that data published would make me feel as though I wasn't a complete fuckup at it.
My older son's charter homeschool wants me to teach a weekly science elective to their 3rd-5th graders. It sounds like fun, and it would satisfy some professional development requirements.
I'm also trying to learn Flash, dabbling with Cocoa programming, and going to weekly archery lessons with my older son.
Wheee!
|
|
|
Showing 1 - 10 of 38
·
1
·
2
·
3
·
4
·
|
