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Comments
Rocky
Standards of living entail a lot more than income and household gadgets.
And indeed, the student loan burden is a necessity. I still have a couple loans out...but I consolidated them at something like 3.35 or 3.5%...so I have no incentive to pay them off early, heck, I have money in an ING savings account bringing 4.4%.
http://www.umich.edu/~regoff/tuition/full.html#Lower_Gen
As mentioned before, the expected loan load is $3500 per year for undergrads. It makes no sense for universities to lend more money for unergrads.
Are you sure you don't do PR for GM?
Don't you live in the panhandle? Lot's of economic growth and job potential there.
1. 45 years ago was 1951, a low point in housing market cycle; whereas right now we are looking at the peak of a housing market cycle.
2. 1951 was before even I-90 was built. What may look like a nice location close to the city today that your grandfather bought was practically in the middle of nowhere, with hardly any road leading to it; certainly no 65mph (really 90mph ;-) highway. The development I'm in was built around that same time. I happened to talke to a neighbor last year, who happened to be the third family that moved into the development back in 1952. He was reluctant to divulge how much he paid for the house until realizing how clueful I was about an executive pay in 1952 was only about $8k. After that, he told me all about how much capital appreciation he had and what a gamble that was when highways were being built :-) So in other words, for comparable location in relative market terms, you should look to the new developments being built outside the third ring of beltway today, not the house your grandfather bought right off the first beltway that was the frontier of metro area back 45 years ago.
3. Don't mean to be offensive, but perhaps your relative income level is not as high as what your grandfather had. $8-10k was an executive pay back in 1951. Officers with Colonel ranks coming back from WWII only made about $8k when they joined private companies and become upper management; you can see that both in statistics and in old movies from that era. Today, the equivalent executive pay is about $150-200k.
Google earth doesn't give info on demographics and development patterns. Take it easy.
But feel free to give a careless and credibility-free lecture on "missing points"....
One clear indication of rising living standards, even in housing, is the fact that houses, even counting new constructions only, are getting bigger and bigger.
Well if you want a good education you are better of sending your kids to the north.
Rocky
My God man, you are the most frustrating person on earth to have an intelligent conversation with.
is, you seem to have an excuse for everything. You can't go to college cause it's just to expensive, you can't work for GM like your Dad, and everyone else in your family, because they pay a crap wage, and it's consumer reports fault. The Aliens abducted you, and their anal probes gave you blurry vision, and a propensity to sweat in public.
All I can do is laugh with you on that.
Rocky
Rocky
-On one hand, I'm not sold on cheerleading for the service-based economy. The fact that the US is effectively outsourcing much of its production through imports is an indicator that we are effectively exporting much of the potential benefit that is derived from the value add, as well as exporting the cash needed to pay that markup.
-By shipping jobs elsewhere, you are ensuring that the middle-aged assembly worker without skills or education is consigned to the bottom of the ladder. The country benefits from having a working class that can buy products, move money around the economy and support itself. If I need to subsidize a former factory worker with food stamps and WIC payments, then I lose.
-On the other hand, the line between domestic and import is obviously blurred. The US worker, and I as a taxpayer, get more benefit from a Kentucky-built Toyota than a Mexican-built Ford. The talk about "profits" is misguided, as profits get reinvested throughout the system. Buy a Toyota, it invests its profits in building a new factory in San Antonio; buy a Chevy, and you can bet that they'll use those profits to expand production in Korea and China. I don't get any benefit from the latter.
-And a consumer, it is fair to expect the best products that I can get for my money. If I buy an inferior "domestic" (and don't deny it, they largely are inferior), that only encourages the Big 3 to stay fat and lazy, while they keep exporting jobs, anyway. Why should I buy a third-rate car to support factory construction in China, when I can buy a car that supports a company that will invest its cash and spread it around to workers and suppliers where I live?
Rocky
7 out of 10 auto jobs are still being provided by the Big 3. Until the Japanese can remotely even come close to that and # and support that many americans in our workforce buying there product isn't as american as buying a domestic product from the big 3 no matter how you like to twist the facts. Y'all like using the fusion made in mexico statement way to often. I bet that Mexican assembled fusion has more domestic content than than half the japanese cars made today. Toyota, has a mexico plant in Tijuana, but nobody mentions that do they. It kills me how some of you are so biased and love to throw the fusion statement up in my face to "prove" your point. I am consistent and believe the fusion should be tariffed.
Rocky
Google earth, wikipedia, it's all good. You're not from here and have likely never spent more than a couple days here...yet you seem like you think you can educate me on the demographics and development of the area. Sorry.
Houses are getting bigger, maybe not better. Big and cheap isn't a way to go. Quality is better than quantity. Some of these McMansions are quite unimpressive under the skin. There's another standard of living issue.
In any case, by the time you move to Michigan, chances are that the Toyota and/or some other manufacturer will have shops there. The governor there seems to be actively courting replacement carmakers.
Rocky
I'd like to verify that figure (although I can believe it), but the trend is for the Big 3 to be firing and the "imports" to be hiring. Rick Wagoner doesn't want to hire Americans, he'd prefer to expand production in China first.
In any case, if the Big 3 are serious about increasing US employment, then the simple answer is to build better vehicles. If they make cars that people want, then people will buy them.
The "domestics" have only themselves to blame for their problems, they were arrogant to believe that the American consumer was too stupid to appreciate quality or a well-packaged car. Companies such as Toyota simply took advantage of their arrogance. Had the Big 3 made better products, Toyota would still be a tiny company trying to make headway here and not getting very far.
Dad, wouldn't care as long as they were american made pizza's and preferably owned by americans.
Rocky
After filtering out the cyclical aspect, places like NYC and Seattle have become more important to the national (and world) economy, just as other places like Rochester, NY and Detroit have become less. So housing prices in these locations all adjust accordingly; the former rising in price, the latter stagnating and even dropping when inflation adjusted. It simply reflects people moving in search of economic opportunities. Real estate in city center of booming towns rise faster than inflation simply because of zoning restrictions causing supply/demand imbalance. When boom turns to bust, the price decrease faster too. For example, Houston still have not recoverred from its early to mid 1980's high, after two decades!
Yes, "overpaid" executive pay in 1961 was more than $8500/yr, but "overpaid" executives get more than $200k today too. Besides, 1961 was before the Kennedy tax cut, so the top marginal tax rate was a whopping 91%! So the after-tax income was much lower.
I can certainly agree with you to a degree on the questionable construction quality of some of the McMansions. However, people seem to have taken a different attitude towards house construction, both due to higher labor cost (elaborate crown molding with hand carving for example is no longer practiced), and perhaps due to a change in value judgement. People used to build houses to last generations; nowadays, many seem to have realized that if the assessed value of the McMansion is only $300k, and the land it sits on is assessed over $1mil, so what building a house to a different taste in a couple decades. Amenities like Jaccuzzi, three-car garage and inground pool have become more important.
But as recent events show the detroiters don't need those 7 workers to make the volume they have now. Actually with Ford's cutbacks of 50% and Gm's of 40% they only need 4 out of those 7 workers, machines do the rest.
Productivity.
Real ratio:
detroiters - 4 jobs
transplants - 3 jobs
robots - 10 jobs.
Excuse me it's 8 out of 10 :P
http://www.uaw.org/resrch/06/harbour_felax1006.pdf
Rocky
Rocky
Why? Did a government official require Ford to make a lousy Five Hundred, or specifically instruct GM to make sure that Cobalts were unreliable and lacking in basic features?
Rocky
I simply said I wish we had past real estate to income ratios. Stop spinning everything off into a tangent. With all the desperate creative financing on the market these days, it is obvious that younger people everywhere are less able to purchase a home than at any time in recent history, necessitating bizarre and dangerous financing options. Around here, you need two very healthy incomes to purchase any detached property within a reasonable distance of workplaces.
I can't look at larger houses/mcmansions as relating to a better standard of living. Bigger isn't better. I'd rather have the beautifully crafted 1600 sq ft brick tudor my parents lived in when I was born than a 5000 sq ft mcmansion. We have a lot more amentities than in the past, but it's all very hollow. Things can't easily be called 'better'.
The domestics got the benefit of quotas that protected the US market, and CAFE rules that exempted trucks from meeting the same fuel economy standards as were required for cars, among other things.
Ford, and in particular GM, blew their profits on buying companies that have proven to be losing investments, from Fiat to Saab to Isuzu, and by managing too many nameplates, most of which aren't worth the cheap plastic on the dash.
The best thing that could have happened to GM would have been to fire its executive team, and replace it with Toyota's top managers to run the place. They don't need tariffs, they need competent people at the top.
1. Would you rather have slower rising housing price than inflation? That could mean either your area is in a prolonged economic deccline and people are moving out; or the school system has gone to hell; or that the zoning is so relaxed that existing owners would find the place a bad investment.
2. Creative financing actually makes it easier for lower income households to get into a house, but whether they can keep it in the long run is a different story. And in the process, they bid each other into bankruptcy. When the bankruptcy finally comes, and houses have to be liquidated, there will be an opportunity for the patient. Heck, this is a three-edged sword :-)
That's why the speculative and right-of-exclusion nature of real estate makes it hard to be used as a guage of living standard, especially at market extremes. In the massive boom of of Japan of the 1980's, real estate rose much much faster than income or inflation; in the 1990's, their receission caused the real estate market to lose 80% of peak value. If you go by income-to-real-esate-value ratio, you'd have the boom and bust exactly backwards.
If you are finding yourself less able to exclude others in the same locale compared to your grandfather, that just means he was doing better compared to his peers. Either that, or your peers are taking more risks than you are. ie. the exclusive and speculative nature of real estate.
Rocky
Rocky
I'm only kidding !
The mid 90's high, here in the Heights where I live, was the biggest yet in Houston I believe.
My 1037 square foot house, built in 1913, original hardwoods, and windows [terrible weatherproofing] 3 bedrooms, 1 bath, is worth a little over 200k now.
Rocky
National Healthcare has been one off the top of my head.
What else ?????
Rocky
Big D and H-Town are megalopolis that when combined will be every bit as big as LA, NYC, Chicago.
Rocky
Rocky
IIRC, D and H are already among the biggest in terms of area.
Big changes like national healthcare will take a long time, much longer than the time left for GM and F. We need to keep our eyes on the bigger fish and higher stakes.
Rocky
Rocky
"When the bankruptcy finally comes, and houses have to be liquidated, there will be an opportunity for the patient."
That's exactly what I am hoping for...give me (not literally, just have it be affordable) a condo or a townhouse with a 2 car garage, and I'll be a happy camper. I know some people who have taken out very risky financing, and I doubt their income will be able to keep up.
I like you am not asking for the moon. I'd like to own a 1800-2000 sq ft. home with 3-4 bedrooms, 2 baths, and not have to pay through the roof for it. It's basically $100-130 a sq. ft. even here in the panhandle. What surprising is in suburbs of dallas, housing is way cheaper than here in the Tx Panhandle. I suppose all the california folks moving here has kept housing price artificially high. Not until recently that I've seen the same homes stay on the market thsi long. However anyone selling there home under $100 a sq. ft. will have lotsa interest buyers.
Rocky
my high school senior has submitted an application there.
when we went to took a tour of notre dame, they started out by saying 'you are probably wondering what you get for your 200k'.