Saturday, July 26, 2008

Closures, and Drug Busts, and Suicides, OH MY.

A lot of people wonder why, after the business of Bend RE has finally begun its Great Implosion, why would I or anyone want to remain anonymous? Why not come out of the proverbial closet, and say who I am. Even BendBB? Who is he?

Well, we found out this week. People in Bend take their real estate seriously. Real serious. Dead serious. People around here will KILL when RE deals go South on them.

I don't know who this Jay Audia guy is, but he swooped in on what is now the Mirada parcel, bought it at a pretty good discount, and was going to make low-end laborer shacks. We've talked about this in the past actually. I've actually put pictures of Mirada right here in this blog.

Apparently Mirada, at steep land price discounts, still did not work out. And this Audia guy took it to heart. Too bad. But it illustrates a point. From the comments:

I have to conclude you don't know what your talking about when you're talking about SF. I think it has more to do with your propensity toward creating artificial stereotypes and projecting your bottomless hatred at them. Sorry, but it ain't reality. Personally, I hate SF. But it is quite sound economically. It is an endless fountain of endless 100K + jobs. If you don't make that in SF, you don't even exist or must have no motivation whatsoever. There is so much money there I don't think you can fathom it.

And another:

You're right the Cali-banger isn't a real person. It's a meaningless stereotype used to make you feel better about not taking responsibility for the conditions in your own community.

Hmmm. People have a passion about it. An irrational passion. They'll kill over it. Themselves when necessary.

They'll accuse me of hate crimes of a sort. "Bottomless hatred". Can't even see the forest for the trees anymore. Mention "Cali-Banger", and they go into attack mode, can't even think straight. Buster said what I couldn't:

The cali is a very real person. They can be seen speeding through Bend round-abouts daily. They can be seen by their car, they can be seen by their dress.
A cali is a fucking disease, and is a real person. HOMER trys to call the whole USA cali-ism, but cali is really about california, and what it does to people, and the kind of people who leave the east-coast and come to cali, and then migrate north.

Florida has its own breed, and in general the east-coast are all mother fuckers, classic americans, in the sense of complete fucking dog-eat-dog americanism.
I concur with homee that mid-west is the salt of the earth, but that don't mean they'll inherit the earth, history shows the meanest junk-yard always wins.

The bible is full of fucking shit, about the meek inheriting anything.
The law of the jungle is the jungle-law. The USA will continue to rape and pillage the world,, and the citizens of the USA will continue to rape and pillage one another. Cali-ism, or its particular type of consumerism, is of course non-sustainable.

Our current post 1998 cycle, where they could sell the $1M, and come to Bend and buy 1/2M, and live off the other 1/2M is OVER. No more perpetual money machine in Bend. The cali lifestyle and visible wealth will go the way of the do-do, just like visible wealth post-depression.

They are real, they walk the streets here thicker than the indigenous Original Bendites. They are easy to spot. They just have the most severe case of some sort of disease that is creeping across this country.

And it's so subtle, it's hard to catch it anymore. It's ubiquitous. My least favorite commercial is by American Express. It's supposedly narrated by a series of telephone operators who tell these Amex Success Stories. A man buys a diamond ring, but is approached STERNLY and is told, "There's a problem". A couple wants tickets to a show and some Amex phone operator weasels tickets for them. Another is what appears to be a ridiculously expensive restaurant.

It GLORIFIES excess consumption. It's so over the top, it makes me want to gag. But I watched that commercial probably 100X with complete accepting indifference before I realized how horrendous the message was. And how absurdly over the top it was. And how COMMON that sort of thing is. Now I run to change the channel or mute the TV whenever that crap comes on, cuz it is sickening.

Cali-bangers are real. The Real Problem is wanton excess. In cars, in clothes, in homes, in everything. It's not knowing what to think about your life in terms other than consuming goods & services. And it's a very easy trap to fall into.

I feel like I have to maintain constant vigilance not to fall into this trap. I feel I have one real weakness, and that's books. They are work related, which helps me rationalize things. I've probably spent $150 on books this year alone. That's a LOT for me. I just don't buy stuff.

I can afford a lot of "stuff". But I have no interest in buying crap like that. I have 2 cars, food to eat, a few computers & books. Don't need much else. Although I do want a house someday. I'm pretty sure that when the time is right, I'll be able to buy a house for cash. Maybe. From the comments:

I knew a guy who had the saying "He Who Dies With the Most Toys Wins" on his license plate. He was a native Oregonian. The attitude you describe is an AMERICAN one, not just a California one.

This ludicrous excess consumption is the #1 Social Problem in this country. IT'S DEADLY because there's No Institutionalized Cure. In fact almost every large scale economic force is DEDICATED to making it worse.

This is why the current BAILOUT is doomed. We are band-aiding the problem, AGAIN.

Dropped rates the for the NASDAQ bust, don't wanna feel the pain. No way. Keep spending, keep the party going.

Second tinderbox, the housing bust, well they're going to bailout the banks. Notice they're BUYING foreclosed homes; fuck the inhabitants, pay off the banks.

Reminds me of Old School forest management. Fight the fire. PUT IT OUT. Think about the destruction. Prevent it at all costs. We can HARVEST that wood, if we put out the fire. Squelch the flames before we suffer!

We found out the ignorance of our ways.

Fires periodically burn the fuels on the floor, and if they burn frequently enough, and nature takes its course, then the fires don't burn as hot. Big trees remain, the ecosystem rejuvenates itself, and growth begins anew.

But humans intervened to STOP THESE NATURAL PROCESSES. Selfish, stupid & short-sighted.

The old NEEDS to be PURGED. It NEEDS to burn. If we don't let it burn now, the next time it goes up it will INCINERATE EVERYTHING. It will go out of control.

Fannie & Freddie should be allowed to go down. Otherwise we end up with companies famously contained in Mr Burns stock portfolio:

Amalgamated Spats. Confederated Slaves Holdings. Baltimore Opera Hat Company.

We're in our Second Huge Firefight. We saved NASDAQ in 2000-2004. We are now saving Fannie & Freddie, and it's burning HOTTER. This time it is WAY BIGGER than last time.

We should let them BURN. We should allow nature to take its course. Let homes be foreclosed on. Let banks lose trillions. We'll survive & move on in a few years.

But the government is GOING TO FIGHT THIS FIRE, because The Religion of Excess Consumption would be sacrificed if they did not. They can't even allow that to ever even be considered. Excess Consumption is What We Do.

Mark my words: Fire #3 won't be containable. They are going to LIQUIFY THE US ECONOMY. Maybe Fire #3 is Hyper Inflation, maybe a huge fucking war. I don't know.

I only know that the US economy is being manipulated to an unnatural demise. We've got to allow FAILURE. We NEED TO BURN. We need to cleanse this desire to consume well beyond our needs.

Moving on...

Dunc had a pretty good post, Greenwood status report.

I travel Greenwood quite often, and it has become riddled with "For Sale" and "For Lease" signs, or the true harbinger of doom, "For Sale or Lease".

If you want to watch the gutting of Bends bread & butter businesses in high relief, then go to Greenwood, mainly between 3rd & downtown. EVERYTHING is empty. It's happening everywhere, but this is a main artery & heavily traveled.

Good training ground for future generations on how to destroy property values. Raised lease rates beyond reasonable, and now vacancy rates are exploding. Once you hit that tipping point of excessive EMPTY, you can't lease anything at any price.

There are in fact many Cent OR standby businesses that are shuttering their doors.

Kayos is closing both locations. Blue Teal. Ernestos. Jokers is now called something else (I forget), after its owners had to kite checks. Tum-A-Lum lumber.

This is Tip-Of-The-Iceberg reporting. For every 10 that is reported as closing, 90 are simply shut down.

Bend media. Just like the US Government. Amex too. Wants to keep you spending. Blow sunshine up your skirt. LIE about the magnitude of the problem. Act like its not even there.


No one is killing themselves over bad real estate deals. No businesses are closing. Just spend.

No. Bends true character is coming out nonetheless:

Tumalo barn yields record $2.8 million pot haul
A raid on a large barn in Tumalo turned up almost 650 marijuana plants worth more than $2.8 million on the street, the largest indoor pot grow ever dismantled in Central Oregon - and it was still gearing up for full operation, officials said Thursday.

Madras meth raid busts 'major supplier'
A raid on a southwest Madras home Tuesday morning led to the arrest of two residents, one described by drug agents as a major methamphetamine supplier in the area.

Bend police capture second fugitive after chase

Driver charged with hindering prosecution; handgun found By Barney Lerten, KTVZ.COM The second of two Bend men wanted in a recent assault and robbery was located by police Friday night and tried to run away but was soon spotted again and taken into custody, officers said.

Bend fugitive on the run captured in Idaho

Knocked on Nampa woman's door, asked for water - and place to hide By Barney Lerten, KTVZ.COM A Bend fugitive wanted in an armed robbery and assault who fled pursuing police late last week, triggering an intensive manhunt, has been captured in Idaho, authorities confirmed late Thursday.
Bend manhunt: Knife-wielding suspect eludes police
Residents get warning; search scaled back at midday By Nina Mehlhaf and Barney Lerten, KTVZ.COM Wanted since Monday for armed robbery and assault, a Bend man forced south Bend residents to keep their doors locked while a manhunt went on for hours Thursday.

Yup. When the rubber meets the road, Bend reverts to its True Self, a crime & drug haven.

No. It ain't "just you". These stories ARE happening with increasing & alarming frequency. Hell, I didn't even mention the huge increase in vandalism.

Look at what's happening. We are all of us consuming lemmings. They want us to keep buying NO MATTER WHAT. Even if it kills us. Even if CONSUMING means ME KILLING YOU. Even if it means ME STEALING YOUR SHIT. Even if it means ME SELLING YOU DRUGS.

Jay Audia, I'm sure was a nice guy. But he bought into The Bend Dream, like thousands of others. But it's a DREAM folks. This place doesn't really have a sustainable economy. That's how 19 year old punks rent HUGE mansions: DRUGS.

Bend is becoming & will become a town of crimes, drugs, vandalism, murder & suicide.

And it's because the media WON'T let us BURN. Audia in the papers as a WARNING? No. Put out that fire. What's after Audia then? Someone going postal?

The Shire shut down. Are they going to kill Peter Jackson? Hey, I'm NOT kidding. Read the comments. People are MAD AS HELL because I'm advocating WE LET IT BURN THIS TIME. "Bottomless hatred" they call it.

City of Bend. American Express. US Government. Bend media.

All want to let it ride. Put out the fire & LETS GET BACK TO NORMAL. Worked out with that NASDAQ snafu, right? It'll work this time again, right? Not going to happen.

IF, and it's a big IF, we manage to avert disaster this time, we simply have built a tinderbox that will rage out of control next time.

The current crisis is so large it will require liquefaction. Fire up the printing presses. Economy turns to mud beneath our feet. Hyper inflation. That'll be it. End of Story.

See, Jay Audia is the collateral damage of this firestorm. There will ALWAYS be losses. Anyone whose been in Cent OR for the Summer season KNOWS there's always going to be a spark.

But no one wants anyone to know that. They think that ARTIFICIAL CONTAINMENT is a sustainable practice, it is not. Jay Audia killed Jay Audia. But in some measure John Costa killed Audia. KTVZ killed Audia. Hell, even Alan Greenspan had a hand in it.

The last containment creates more victims The Next Time. And believe me, There Is Always A Next Time. If you notice, this country has begun to be run as if there isn't.

Not On My Watch. I don't care what happens, just not on my watch. That's how it's being run. Give it to Obama.

The first cycle, I had friends who lost lots of money. But nobody DIED. Now in Round 2, we're starting to see what happens when nature is NOT allowed to take its course. People we KNOW have started to DIE.

Jay Audia would be alive today were the NASDAQ recession allowed to run its course. But no, Greenspan had to resurrect the Cali-Banger ASAP. Who cares about Round 2, that's Not My Watch.

Folks, we need to let this thing go, run its course & burn like hell. I DO NOT have "bottomless hate" for you or your excessive ways, Cali-Bangers. I have quite a few friends who probably scored over 50 on my little Cali-Test. I had a few points too.

But the Cali-Banger lifestyle is going to INCINERATE this country. Negative Savings? We've started acting like it's OK! What? We've gotten used to it.

For each one of us, our government owes FOREIGN GOVERNMENTS hundreds & thousands of dollars. We are transferring our wealth, built over the course of centuries, to foreign governments & corporations at a rate unheralded in history. We only have to buy 400 billion barrels of oil, and we'll be broke. $700 billion a year OUT THE DOOR. Your 3 humungoid SUV's & 2 White Liberal Guilt Prius' are why that's happening, Cali-Banger.

Who cares about what we owe each other. Credit cards, budget deficit. Blah, who cares. That's just us owing us. But when we owe others, we are well & truly going broke. The budget deficit won't kill us, the Trade Deficit WILL. And the Trade Deficit is the DIRECT RESULT of the Cali-Banger lifestyle, a lifestyle that has the decision makers of the World scrambling to preserve it AT ALL COSTS.

Simply realize it CANNOT be saved. Negative savings? My God, talk to anyone about a topic like that prior to the last 30-40 years, and they'd have thought you crazy.

At some point 'we the people of bend' have to take action, and collectively edoocate the BULL&SORE that having +50% of homeless beggars roaming in BEND will NOT fix the fucking bubble.

If we stay on this bailout track, the US will be the beggar out on the course, picking up balls. We will be the Worlds beggars, if we aren't already. Centuries of work, wiped out to preserve an artificial lifestyle.

You need only educate yourself on the aftermath of artificial forest management to see where the US is headed. We did it for a hundred years. Just meant forests overrun with fuel, tinderboxes, burned out of control "next time". We couldn't "save" them, the Big Trees were not big enough to survive & they burned.

What are these "Big Trees"?

Note, also before one jumps to some huge fucking conclusion, the oil will be gone as know its use in 20-40 years, and the USA has the biggest COAL deposits in the world. Our coal will ten-fold, the rest of the world will be buying coal derivatives in the form of liquid petro from the USA in the next century.

Your cali-ism of excess, is just a 1920's blip. The world moves on, I think the logical assumption would be that if the USA continues to impoverish itself, that you can expect China or some 'super-power' in the future to invade the USA to secure our coal deposits.

We are. The US itself, is. We need to let this fire burn. We didn't last time, and now this time it is burning so hot it threatens our very financial system. It threatens to take down a system that has put MILLIONS of people in homes for the past 40 years.

If they liquify our economy to preserve the Cali-Banger this time, there won't be a place left worth going here. Des Moines, Wichita? No, the whole mess will be taken down, no matter its participation in Round 2.

Shit get an old boat, or an old RV, and head down to mexico and live on $500/mo or less, or shit go to thailand, and live on $500/mo or less and get a 20 yr-old wife even if your 80..

We've talked back in the day about some pretty weird stuff. Gardening for your food. Caching gold, for the love of Christ. Real survivalist stuff.

(How about this: Historians might look back on George Bush as one of our greatest, most prescient Presidents! After all, he created the Great Country of Amer-Iraq-ica, 3rd largest oil reserves in the World...)

And this stuff is actually starting to make A Lot Of Sense.

Did you think people, people you know, would start DYING over this thing?

People are dying, collateral damage of artificial maintenance of a natural process. If they're DYING this round, what happens Next Time.

China takes us over? Buster & his clapboard; Looks less & less crazy everyday. It ain't Wichita or Charlotte we'll flee to, to escape Round 3, it'll be Thailand or Australia or China.

We need to let this fire burn. Let it burn, or there won't be a country worth having next time.

Drugs. Business Closures. Murder. Suicide. Speed traps. Bank failures. Homocide. Fannie. Freddie. Foreclosures. The Plaza. Meth dens. Robbery. Embezzlement. Fraud. Jay Audia.

All for want of the Cali-Banger lifestyle.

They are all of the same origin. Round 1 wasn't allowed to run its course. These are the offshoots of that decision. They are the fuels of Round 2. And they are AGAIN not going to let the fuel BURN. And so begins Round 3. Hello Bangkok, goodbye Wichita & Charlotte.

We should LEARN from our own mistakes & the mistakes of others and Let It Burn. If we do not, this time will be remembered as the most backward & uneducated period in our financial history. The Great Depression... The Japanese Bust of the past 20 years... both the DIRECT RESULT of Well-Meaning, but ultimately DESTRUCTIVE intervention by governments who wanted to preserve the status quo At All Costs. And the costs ended up being high indeed.

When you want to know The Real Costs, the Total Costs, of this bailout, look around. It's everything. It's all around us. We'll lose this country. Let It Burn means making do with your car for another 2-3 years. It means NOT buying $200 in clothes this weekend. It means waking up & not being lulled into a coma by some fucking Amex commercial. You DO NOT NEED 90% of the shit you think you need. You don't need that fucking iPhone, PS3, big screen TV, or all that other crap. You don't.

Consuming in excess of what you're making, and pre-consuming all your future earnings is the road to complete disaster. We can't survive as a country & think that's even remotely possible. We're transferring $700 billion overseas every year JUST FOR THE OIL needed to perpetuate this myth. And it is a myth, a 100% fantasy, and it cannot go on.

But our government & corporations are doing everything possible to keep this dream alive. Despite the fact it will ruin us. 100% ruination.

We Need To Let It Burn.

Saturday, July 19, 2008

"The government doesn't have any money."

Everyone seems to take offense at the "Cali-Banger" moniker these days.

Let's get this straight: Cali-Bangers are more about lifestyle than place of origin, although the two are correlated eerily most of the time.

Cali-Bangers lead a life of excess, of excess in almost all aspects of their life. Their motto, "I can sleep when I'm dead", seems appealing on some levels, squeezing every last drop out of life & such. Seems even admirable, on some level.

But Cali-Banger excess has no limits. It leads to competitive excess, a need to "out do" everyone, in everything. You got a big house, mine's gotta be bigger. You make big money, I gotta make more. You got a hot wife, mine's gotta be hotter & younger, even if it means surgery. And on and on.

What does this have to do with Bend & it's housing? Well, think about the Coasts, in contrast to the Mid-West. The Midwest is priced where it is because large chunks of the Midwest population simply refuse to work 2 jobs, and have their kids working too. They care less about $800 iPhones than Cali-Bangers. They care more about raising their kids than yanking out their wifes C cups & stuffing in double D's. They care more about human decency than Botox.

And this might sound high-falutin', holier-than-thou bullshit, but actually it will lead to the Coasts, and Cali-Bangers especially, falling farther than anywhere else in the Country with respect to housing.

Think about it: Say you're a Midwest family, Dad working, making blah money in some blah town. OK, your house cost $75K. Everythings OK, making ends meet.

Then the shit hits. Dad gets injured, car wreck, or something. What to do?

Well, in that case, Mom can work. She won't make a fortune, but she really doesn't have to. They aren't the vassal's of their possessions. They own little, they owe even less. Mom will get them by, and Dad has friends who will help & they're insured. Their means are modest, but so are their needs.

Enter the Cali-Banger. They own 3 huge SUV's, plus a sports car despite being a family of 3. Their house is too big for them. They simply don't even comprehend that they didn't need all that room, they needed to keep up with the Joneses. Same with the cars. Same with the gadgets. Same with their bed sheets, clothes, jewelry, and everything else.

They are making a TON of money, and they work all the time for it. They own a lot, and they owe far more, because they don't buy anything that appreciates, only depreciation. Boob job & Botox, and fat sucked out here & blown back in there. They only value their lives in terms of what they have IN EXCESS of what their friends have.

What's wrong here?

I'll tell you; There is no slack in the system. There's nothing left. The engine is running at max, and it can't give anymore.

The Cali-Banger is self-destructing. It has mortgaged it's life for more. The Cali-Banger is 150% maxed out. It's not just fueling all the possession-obsessed idiocy it can, it's borrowed ALL IT CAN. There's not a penny that isn't already spent, whether earned today or in the future.

This is why I hate Cali-Bangers. Their morals are repugnant, but so are many whitey-ass hillbillies. So are many blacks. But Cali's are worse.

Cali-Bangers will ultimately self-destruct. They will ultimately be carried out. California will suffer like no where has ever suffered in the ANALS (yeah, I said ANALS) of financial history. It's no coincidence they have suffered the first BANK RUN in our lifetime.

California is self-destructing, and it is The Cali-Banger that is their undoing. The hypocrite that preaches Green living & business from their 8mpg SUV. That is a Cali-Banger. Excess, hypocricy, competition, ego, and consumerism gone completely berzerk. THAT is the Cali-Banger lifestyle.

And one other thing: A Cali-Banger will ALWAYS DEFEND, and will never understand why anyone could possibly want to live any other way.

Look at where home prices are the highest. The Coasts. Why? Cali-Banger lifestyle. 2 1/2 incomes. Work more to spend more. Keep up with the Joneses. Period. Midwest? 1 income. There's slack in the system. There's capacity. There's breathing room, financially & otherwise.

Where has this brought us? Besides kids unable to communicate besides txt msg, people working themselves to death? Nothing. This country has adopted the Cali-Banger lifestyle. What is our ONLY REAL ASSET? Our ability to work. And that resource is 150% tapped out; We are not just spending 105% of what we make, we have mortgaged our future consumption to the hilt. And beyond. We have almost NOTHING left to give. Our only Real Resource, OURSELVES, has been SOLD.

In the 50's, we were poor. Sort of. But our expectations were not huge & we saved. Then it was realized that there was HALF this country that wasn't earning. So women began working. On the Coasts. Largely. Then kids.

And so now, to adopt a Cali-Banger lifestlye of 100% gadgets & Paris Hilton dogs that we see on TV, we've mortgaged our lives beyond the hilt. We can thank The Cali-Banger. California is the Detroit of tomorrow. We are digging a hole so large it will bury us all.

The Cali-Banger has made it NECESSARY that EVERYONE MUST WORK to even afford a house. How many people have had to start working in Bend because the Cali-Banger lifestyle has been so whole-heartedly adopted. More for everyone, right? Sounds great!

We all get gadgets, and little dogs, and cars, and big fake titties, and all sorts of great stuff. We've become slaves to Our Stuff. We are living for The Stuff. We'll die to get more Stuff. We have spent everything we will ever earn to live for today. Our government has likewise done the same.

Concern grows over a fiscal crisis for U.S.

Thursday, July 17, 2008

(07-17) 04:00 PDT Washington - -- As the Bush administration proposes backstopping mortgage giants Fannie Mae and Freddie Mac with a $300 billion line of credit and Congress contemplates another economic stimulus, the question is who will bail out the government?

"People seem to think the government has money," said former U.S. Comptroller General David Walker. "The government doesn't have any money."

A rare consensus has developed across the political spectrum that the government's own fiscal affairs are precarious, with an astonishing $53 trillion in long-term liabilities, according to the Government Accountability Office.

To put that number in human terms, the debt has reached $455,000 per U.S. household. As that debt grows, the United States increasingly relies on foreigners, including China and Middle East oil producers, for financing.

"The factors that contributed to our mortgage-based subprime crisis exist with regard to our federal government's finances," said Walker, now head of the Peter G. Peterson Foundation, a group established to raise alarms about the nation's budget. "The difference is that the magnitude of the federal government's financial situation is at least 25 times greater."

Baby Boomers

This year's presidential election coincides with the first retirements of the 78 million people born between 1946 and 1964. The first of this Baby Boom generation may now collect Social Security. In three years, they will join Medicare, the giant health care program whose finances are commonly described as out of control. Medicare accounts for the bulk of the nation's long-term liabilities.

The presidential candidates, Republican John McCain and Democrat Barack Obama, have not addressed what the aging of the Baby Boom generation means for the federal government. Their brief forays - Obama's suggestions to raise the payroll tax on high-income earners to buttress Social Security and McCain's description of Social Security's financing as a disgrace - have been met with furious attacks.

Both promise to spend hundreds of billions of dollars on new tax cuts and spending programs. Their health care proposals concentrate more on expanding access than controlling the soaring costs that are driving the federal budget problems and squeezing workers and businesses.

Health care costs

"Health care costs are just amazing," said John Shoven, director of Stanford University's Institute for Economic Policy Research. Total health care costs now consume 16 percent of the economy and are headed quickly toward 30 percent, Shoven said. "Social Security is a big problem, but it's dwarfed by health care. Even the housing problem is dwarfed by health care."

Just the built-in rise in spending on programs for the elderly will cost about 25 percent of workers' payrolls over the next generation, said Richard Jackson, director of the Global Aging Initiative at the Center for Strategic and International Studies.

Robert Greenstein, director of the liberal Center on Budget and Policy Priorities, agreed that "the nation faces large, persistent, long-term deficits that ultimately risk damage to the economy. We agree that policymakers have to make tough choices soon."

There is consensus, too, on what needs to be done: Cut spending and raise taxes. A bigger problem is how to contain health care costs, but some form of rationing is necessary, experts said.

Only disagreement

The only real disagreement is whether the government's fiscal condition will lead to a financial meltdown, or whether the U.S. economy is strong enough to right itself without a sudden loss of confidence and a flight of foreign capital.

"People on Wall Street think I'm Dr. Doom & Gloom," said Kent Smetters, an economist at the Wharton School of Business at the University of Pennsylvania and a former Bush Treasury official. "I believe we could have a financial crisis like we've seen in South America or Asia. It could easily happen, and under current policy will happen in the United States. People say, 'Gee, give me a date.' Obviously, that's impossible, but the longer we wait, the higher the probability. Could it happen in the next decade? Absolutely."

Alice Rivlin, budget chief in the Clinton administration, discounts the possibility.

"We're a much stronger economy than Argentina," Rivlin said. The government "can handle borrowing in the range that would be necessary in a recession," she said. "What we can't handle is the cumulative long-run obligation."

Financial markets are often fixated on the short-run, and the government's finances are far from transparent. Unlike corporations, the government is not required to state its long-term obligations. Crises of confidence, like today's banking problems, strike suddenly when a tipping point is reached and investors decide to flee.

The government's fiscal problems are "like termites in the house," said Jackson. "You don't notice it until foundations are eroded."

"I had such a frustrating meeting the other day on the Hill, where one staffer said, 'We don't have a problem until Wall Street tells us we have a problem,' " said Maya MacGuineas, head of fiscal policy at the nonpartisan New America Foundation. "By the time the financial markets tell us we've gone too far, it will be too late to fix this in any rational way. We are the toad in boiling water, where it's getting hotter and hotter and nobody's really noticing."

Will they still buy?

The key is whether foreigners will continue to buy U.S. debt. They now hold 45 percent of U.S. Treasury securities, and in all about $11.5 trillion of U.S. public and private debt, say UC Berkeley economists Ashok Bardhan and Dwight Jaffee.

Chinese entities, including sovereign wealth funds that invest government savings overseas, own about 10 percent of U.S. Treasury securities. Even a minor change in China's investment policy could have a major effect on the dollar's value and cause "a sizable increase in interest rates," the economists said.

Still, because of a shortage of creditworthy debt instruments worldwide, and the large role of U.S. institutions in global credit markets, foreigners have little choice but to invest in the United States, they said, predicting "slim chances of abrupt change."

Action needed soon

Whoever's right, all agree that the sooner the problem is tackled, the better. "Like almost any financial problem, if you don't work on it, what happens is it compounds with interest," Shoven said. "There are lots of ways to fix it, and what we pick is none of the above."

The staggering U.S. debt

The federal government's finances are in worse shape than its annual budgets show, because the government is not required to state its long-term obligations, which work out be about $455,000 for every household in the nation.

Breaking down the numbers

Current liability:

Social Security: $6.7 trillion

Medicare: $34.1 trillion

Total long-term government liability: $53 trillion

Source: Government Accountability Office, Long-term Fiscal Outlook, Jan. 2008

Where it goes

U.S. debt held by foreigners as of mid-2007:

-- Foreign holdings of U.S. equities: $5 trillion

-- Foreign holdings of U.S. corporate bonds: $3 trillion

-- Foreign holdings of U.S. Treasury securities: $2 trillion

-- Foreign share of U.S. Treasury securities: 45 percent.

We are a country on the precipice of utter destruction. It is due to The Cali-Banger. The 3 hybrid SUV-driving, fake tan & fake tits, 3 iPhone, celebrity-worshipping, self-obsessed, self-consumed, 4 mortgages, hideous Cali-Banger. And they've come to Bend. And they are remaking it in their image. And everyone seems to think this is fine.

Our one past savior is productivity. The rate at which a static amount of work yields still more output due to efficiency & improved tools we use.

But we have always grown at faster than this rate, because we were on a slow but continuous borrowing slope. We consumed more than we produced by borrowing. The crisis you are seeing today is the result of that lifestyle. So we produced extra purchasing power with 2-3% productivity gains each year, but we also borrowed 3-4% from future earnings, which is essentially negates our future earnings.

You might think that some slimey bastard you know, who's just moved in and brought all his heinous Cali-Banger toys with him is The Ultimate Cali-Banger. No. No, the Ultimate Cali-Banger would need to continuously spend so far beyond their means, it is literally unbelievable. The Ultimate Cali-Banger would actually FIGHT to spend money on the utterly ridiculous. The Ultimate Cali-Banger would be REVILED The World over, and looked upon with complete disgust.

It seems obvious that The Ultimate Cali-Banger is:

The US Government

Our government, AT OUR BEHEST, is pissing away our efforts at a catastrophic rate. We are at war, yet again, and The Spoils? Right, the spoils are basically a Huge Toilet. The Worlds Biggest Outhouse. The Spoils of War are CRAP.

We are The Worlds Colonialist. Duck & Cover, cuz Here We Come. And as just about any Colonialist can tell you, COLONIALISM IS HIDEOUSLY EXPENSIVE. It costs much, and yields next to nothing.

We are worth LESS now than at any time in recent history.

How much oil it'd take to buy the US

At the recent price of $140 a barrel, it turns out to be a mere 400 billion barrels, or just about the combined reserves of Iran and Saudi Arabia.

By Scott Burns

Most of us view the world through dollar glasses. It's perfectly reasonable. Dollars, after all, are the currency we use in daily life. And those lenses, until recently, were distinctly rosy.

When we asked, "How much is that in dollars?," we usually liked the answer.

But it may be time to ask another question: "How much is that in barrels of oil?"

Trust me, others are doing exactly that.

That's when the world starts to look very different. It also looks more than a little scary to the U.S. Today, the net worth of the entire country is equivalent to a mere 400 billion barrels of oil. That's a smidgeon less than the proven reserves of two Middle Eastern countries: Saudi Arabia (264 billion barrels) and Iran (139 billion barrels).

At more than 40 times its 1970 price, oil has outstripped the value created by a full working generation of Americans in a period of dramatic technological change and innovation. During the same time, the value of American business shares, as measured by the S&P 500 Index ($INX), has risen only about 15 times above its 1970 level.

I find that hard to believe. After all, in 1970 the Internet was only an arcane toy for academics. Computer memory was desperately expensive. Intel had just been formed and was introducing the first dynamic random access memory chip. Bill Gates had yet to enter (or drop out of) Harvard and was five years from founding Microsoft. Steve Jobs was years away from creating the Apple II and was decades from launching the iPhone. AT&T was still a single national company, owning all of the regional Bell companies.

No one was yet thinking the U.S. post office was a quaint institution, soon to be treasured for its many buildings that could be converted to trendy condos. Phone calls were expensive. Sears, Roebuck was an important retail stock, not a real-estate play by a hedge fund manager. All surgery was invasive. And it was still believed that stomach ulcers were caused by stress. Google founders Larry Page and Sergey Brin had not yet been conceived, let alone applied to Stanford, where they would create Google.

All of that dynamism and creativity pale against the price of oil. Looking as far back as 1970, America has never been worth less in barrels of oil.

I learned this by measuring the net worth of all U.S. households and nonprofit organizations in barrels of oil. Every three months the Federal Reserve estimates the value of our collective tangible assets, financial assets and liabilities to arrive at our net worth. It's the whole enchilada -- all our cars, our houses, our durable "stuff," bank deposits, stocks, bonds and mutual funds. Everything. Then it subtracts all our mortgages, consumer credit and other debt to arrive at our net worth.

This year's floods in the Midwest are projected to reduce the corn harvest by 700 million bushels. Look for higher prices on meat and soda, and more ethanol imports from Brazil.
At the end of March, for instance, our collective net worth as a nation was $56 trillion, the second straight quarter it had dropped. Divide $56 trillion by the recent $140-a-barrel price of oil and you get 400 billion barrels of oil as the value of America, a fraction of our national value in 1998, 1995 or even 1990.

Either oil is too expensive or America is too cheap.

YearHousehold net worth* Price of oilBarrels to buy America


$3.4 trillion


1.1 trillion


$5.1 trillion


670.3 billion


$9.5 trillion


438.6 billion


$14.2 trillion


589.7 billion


$20.3 trillion


1.1 trillion


$27.7 trillion


1.9 trillion


$37.4 trillion


3.3 trillion


$48.1 trillion


1.1 trillion


$57.7 trillion


481 billion


$56 trillion**


400 billion

The last time we worth this little, was 1980. We were practically just hobbled by an oil shock. We were mired in a quagmire of stagflation.

And guess what? Things got really great after that. Well, mostly. Reagan-omics itself almost crippled this area in the 80's. But the country as a whole experienced HUGE wealth gains. Times were good.

So it'll happen again, right? Great time to buy, right?

I don't think so. Back then, we weren't leveraged to nearly the extent we are today. We were still coming into the Great Computer Revolution, and the Chinese were still yet to become the HUGE producers (not consumers) of junk beloved the World over. Oil & commodities entered into massive price declines.

Of these things, we can at best look forward to some unknown technological revolution, which is at best in it's infancy today. And even if we do find it, it's gains have been largely spent by a pattern of government individual borrowing. We are tapped out. That's why it really is different this time.

And it's a Global Phenomenon. Everyone (except for the Chinese & Middle East) is tapped out. In a planet of Cali-Bangers, we are clearly the Head Banger.

Producers will out.

Producers will win, consumers will get crushed, and we are the ultimate self-medicated (on debt) consumer. And I'm sure the Chinese & Iranians are chuckling everyday, KNOWING that capitalism has had it's run. And it's finally going to collapse in the Ultimate Minsky Moment.

And if the US is the Ultimate World Cali-Banger, then Bend is the Penultimate Cali-Banger town. I've never seen a place so consumed with it's own munificence. Celebrating & wallowing in it's own glory. Holding up a mirror to behold it's own beauty.

Fucking pathetic.

Listen, being a Cali-Banger doesn't mean you have to come from Cali, it's just a hell of a correlation. But it has been known that Cali-refugees were literally born in the wrong place, and they knew it. Like a transvestite, they knew they were inhabiting the wrong body right away. Here is a test to compute your Cali-Banger Quotient:

1) Do you own a Denali, Yukon, or Escalade? If yes, and you are a 2 person household, add 10pts. If you have 2 kids, or haul crap in it in a true work-related fuction, add 5 pts.

2) Are you from Southern Cal? Add 10pts. Did you arrive between 2003 and right now? Add another 10pts. Did you BUY anything (home, townhome, doesn't matter) on the Westside? Add yet another 10pts.

3) Did you start up your own business when you got here? Add 10pts.

4) Eaten at Merenda, Deep, or anywhere in The Old Mill in the past month? 10pts.

5) Fake titties anywhere in your family or bloodline? Add 20pts. Realtor? Make it 30pts Botox? 40pts.

6) Bend Athletic Club? 10pts. Juniper Center? Subtract 10pts.

7) Did your last bike cost over $1,500? 10pts. When you roadbike do you where spandex? 10pts.

8) Did you sell a Cali house, move here & pay cash for you first Bend home? 20pts.

9) Own a iPhone or Blackberry? 10pts, I don't care if it's for work. I know an iPhone doesn't work here. Cali-Banger don't care.

10) Are you pro-"Green"? Have you bought Yet Another Automobile, parked a gas-hog, and started driving a Prius or some shit to work? Add 20pts, you fucking idiot.

You pass the Cali-Banger threshold by scoring a 50 on this test. Actually a true Cali-Banger will get a zero on this test. They simply refuse to listen to reality.

Cali-Banger isn't really a person. It's a code for what's wrong with this country. We're all of us turning into these wretched monsters. It's our tolerance that allows it.

We have started to tolerate this horror. We glorify it. We glamorize it. We worship it.

I, for one, have not. I HATE Cali-Bangers. I don't suffer their bullshit in silence. I don't fall for their wounded puppy bullshit. I loathe them. They ARE WHAT'S WRONG WITH THIS COUNTRY.

Go back to your shithole & corrupt your own kind. Fuck you & Get Out.

Saturday, July 12, 2008

Bend's Newest Landscaping Craze? Weeds!

Well, here was the suggestion, short of anyone actually accepting the Guest posting challenge, that I thought was the most interesting:

The other thing cuz obviously homer doesn't need to work so fucking hard, is to post questions every sunday, and comment highlights, and then let everyone respond, and then the following week post conclusions, and MOVE ON. ( More of a socratic method )

This will be tough, because I have an absolutely awful memory, and this will require that I actually try to write a lot of stuff down during the course of the week, that I can write about. There's no shortage of material, it's just a shortage of mental goo that keeps it held together until the weekend which is lacking.

I suppose the highlight of the week locally, was the quarterly summary was released. There were a few points of interests.

First, dollar sales are below 2004 levels. There was $92MM at this time in 2004, and there is only $85MM so far this year. That is down 47.24% from 2007, and down even more from the peak in 2006.

If you recall, the real signals that Bend was not exempt from the slowdown came in the Fall of 2006. That's back when I was on BEM's board, and we all watched in amazement as inventory went ballistic. If you don't recall, well then click on Clive's inventory counter to the right.

We are, of course, at all-time highs in inventory, this place is awash in it.

It seems like just about every "superlative" has been exhausted describing the depths of Bend's RE problem. And it is clearly getting worse. But call me crazy, but DOWN 47% is starting to sound... OK.

"Down 50%? Eh. I've seen worse."

I don't know about you guys, but I am actually becoming accustomed to The Horror. Down 20%?... I mean, damn that would be reason to celebrate!

And actually, local Bend media did EXACTLY what I said they'd do: They celebrated the 100% PURELY SEASONAL UPTICK in Cent OR RE as The Turning Point. As a reminder, here is what I wrote way back on March 3 of this year:

February in Bend -- The Real Estate Calamity Continues

The Good News? Well, Deschutes County traditionally "bottoms" in February. Things usually get better from here, for about the next 6-8 months. Sales will pick up, things will be declared "OK", and such. But if you really need to sell, realize that this yearly game of musical chairs ends as predictably as it starts, and if you Need Out, this is Your Time.

And so we had Yet Another In A Long Line Of Stories declaring Things Are All Right:

June uptick ‘good news, but barely

June produced a glimmer of hope for a Bend real estate industry that reached its lowest depths in early 2008, according to a report this week from Bratton Appraisal Group.

Ah yes, Bratton Appraisal Group, the RE Genius' who brought us the April 25th Low In Cent OR Real Estate.

What's really great about this, is The Bulletin PRINTS stuff from Dana Bratton AD NAUSEUM, and they PRINTED his "tongue-in-cheek" April 25th Rock Bottom Prediction. This was, of course, RIDICULOUS, so ridiculous that lots of people sort of chuckled an uncomfortable chuckle, and said "Well, maybe... maybe... maybe..."

But you know, LOTS OF PEOPLE, including Dana Bratton were hoping beyond HOPE that he was right. I mean, The Bulletin & just about everyone else in town PRINTED this little "joke". No, it was NOT really a joke. It was what just about every other thing printed in this town regarding RE is: A 100% hope-based puff piece meant TO SELL HOMES.

Don't think Bend media had pinned their hopes on this little "joke"? Here's The Incredible Hulce from her most recent editorial (OK, there is no link, because Hulce keeps her piece of shit website about 2 months behind the print edition. Wake up White Peepul. Geez.):

While we all wanted to believe that Dana Bratton was right and the housing market turned on April 25 -- it didn't happen. It is more likely throughout 2008 that housing prices in Central Oregon will drop more, that gas prices will continue to go up, that the stock market will be tedious and no one will suddenly solve the healthcare crisis or end the war in Iraq.

Yeah. See? It was NOT a joke. You think Bend media remembers a "joke" told back in Feb-Mar, only to reveal the "punchline" on July 2? No. This entire area is founded on the idea that The Perpetual Motion Machine is REAL. And if we can just BELIEVE ENOUGH, that The Perpetual Money machine can be fired up again.

Always Cause, never Effect. "I'm not responsible for the consequences.." Complete disconnect, 100% Selfish. Californicated. People here have become so delusional from the Kool-Aid they don't even realize what they're saying is INSANE. Again, the Incredible Hulce in the SAME EDITORIAL:

So we ask: what would you do? Would you make gas prices go down, the housing market boom again? Of course you would, but how?

My God, this woman is INSANE.

I WOULD NOT make gas go down, and I MOST CERTAINLY WOULD NOT "MAKE" housing boom again. Why? For the love of Christ...

OK, first oil. We need go NO FURTHER than The Incredible Hulce herself to hear the problem; Again, same piece:

We all know America is addicted to oil. This addiction plagues our health, our environment and our society. Given that two-thirds of our oil comes from foreign nations leaves us open to the whims of potentially hostile foreign governments and the combustion of oil in our vehicle chokes our skies with smog and contributes greatly to global warming.

Oh yeah, this "oil" shit sounds great. The Incredible Hulce, earlier in the same fucking piece, advocates DROPPING THE COST OF OIL, such that we might feed this addiction, because it seems to have SO MANY positive side effects, such as turning this planet into an Easy Bake Oven & placing our collective cocks on an Iranian chopping block.

Seriously, is it just me, or is Bend media run by infantile, selfish lunatics?

Hulce actually wants RE to go into another BUBBLE. She wants it to BOOM again, and ASSUMES that EVERYONE with half a brain would obviously want the same thing. Yet, here is a piece that made THE FRONT PAGE of her moronic rag (Oct 3, 2007):

Affordable Housing Expert Adderesses Key Issues Facing Region

The most significant workforce recruitment and retention challenge for local businesses in Central Oregon is predicated on the shortage of housing affordable to workers, according to a survey by the Central Oregon Workforce Investment Board.

That is the first sentence, front page piece.

So the NON-AFFORDABILITY of housing is THE WORST problem for employers in Cent OR, and HULCE wants it to get WORSE. And what's worse, she sees NO CAUSATION between BOOM & BUST. The BUST we are now seeing is in NO WAY connected causally to the BOOM.

And OIL, which causes INTERMINABLE HEALTH & ENVIRONMENTAL PROBLEMS & MAY WELL KILL US ALL, yeah, she says in the same fucking breath that she wants it cheaper so we can consume MORE OF IT.

What a fucking myopic lunatic. Only a complete nut would run a front page piece (Sept 19,2007):

Deer Ridge Welcomes First Inmates

For the love of Christ. I'm sure it was a joyous time for all involved.

Pamela Hulce Andrews: So Warden, how is opening day?

Deer Ridge Warden: After being confined to prison buses all day for the trip to Deer Ridge , many of the large black inmates convicted rapists celebrated their reunion with deep expressions of love for the smaller White convicted child molesters, by embracing them with the deepest penetrating act of love a man can give another man. It really was a touching sight. And Pamela, the guards were so happy to be reunited with these convicted felons, that they tear-gassed the lot of 'em on Day 1 out in The Yard.

Pamela Hulce Andrews is INSANE.

The point? This place is SEASONAL. My God, it's so fundamental to anyone who's been here for more than 5 minutes, it's not even worth repeating. But Bend media wants you to think WE'RE TURNING A CORNER. No. We are NOT.

Sales up? Of course, but anyone who can fog a mirror knew that back in Feb. Feb 1947, that is. We ALWAYS turn up from a bottom in Feb, and get smacked RIGHT BACK DOWN in Oct. Always have, always will.


"Hey Pat, I'm predicting that this December is going to be strong! And I'm going out on a limb here, but I'll predict right now, it'll be stronger than November!"

Oy. If ordinary businesspeople actually RELIED on the media & their CONSTANTLY
INTERVIEWED EXPERTS in this town to run their businesses, they'd all be dead.

Six months ago, in the garage of his west Redmond home, Carl Ylvisaker started tinkering with a tire, a trailer hitch, an alternator, car batteries and a power inverter.

The result: a device with the potential to complement alternative power sources like solar panels and windmills. And if everything falls into place, something that could help resolve the world’s energy crisis, says Ylvisaker, a retired physical therapist.

We’re in an energy crunch right now,” Ylvisaker says. “This will certainly help defray that.”

My God. You hear that Timmy? We're in a fucking energy CRUNCH here! And this motherfucker has got a gopher wheel, a rubber band, fucking fishing line, and the complete McGyver DVD series that is going to DEFRAY THAT.

I read things like this, and it pushed my Recovery Date farther out, and my estimate for the bottom DOWN.

Ok, moving on...

Stocks got roiled this week, officially entering Bear Market territory for the first time since the NASDAQ crash.

I still find this one of the strangest things about this Housing/Credit bust: Not that it happened, but that it happened so late. This countries markets are populated by vultures that would hurl their mother under the bus to scalp an eighth. These guys are smart & they are motivated by making money before the next guy & that's it.

And I don't know about you guys, but this thing seemed clear WAY OVER a year ago.

I haven't bought stocks in many moons. Last time I bought was 2002. I thinned my meager holdings in 2005-2006 on housing fears. And subsequently watched IN HORROR as things continued ever upward.

I got that confused feeling that I got in the late 90's; I just did not understand why people were buying. Quagmire-war, gas going up (although it was still in the $2's back then), rising inflation, and a housing crash seemed inevitable to me, at least. Worst of all Worlds.

Not for the S&P. Ever upward.

And my hard-won experience has taught me to stand aside when I don't fundamentally understand pricing on the upside, and to also jump in when I similarly don't understand why things are so cheap on the downside.

And then Bear Stearns when bust in March & I got some measure of vindication. But still, things were very good, and they bounced really strong after that, and The Bottom was declared from every corner.

Every corner but here. I said sell the rallies, cuz the Most Catastrophic Destruction Of Wealth Ever Recorded doesn't end in one day. And I'll say it again: Sell rallies.

But I have started to find bargains. And these are not slimly underpriced, fundamentally strong issues. They are deeply & obviously troubled. Big RV sellers, car dealers, and big pharma with weak pipelines.

Are we at "Fair Value"? Well, for me, we haven't been there almost ever. Why? I am a cheap bastard. I only really like buying individual issues that look underpriced by 80-90%; ie: potential 5-10 baggers. Many times these things are headed from $50 to $.50, and I will pick them up at $2, thinking I am King Of the World.

No. Most of the time the Market is Dead Right, and these things get killed. But occasionally the market is wrong, and these things end up as Huge Winners. My approach very much reminded me of the Taleb interview where he advocated buying small amounts of many extremely speculative issues, and also keeping a big wad of cash in reserve.

To date, it's been my selling discipline, not my buying, that has been my fatal flaw. After sustaining short term, excruciating losses (30-50%), I always swear I'll sell at breakeven & NEVER DO THIS STOCK THING AGAIN. And so I do. Right before the 10 bagger hits.

But I hope to have solved it this time with this bit of knowledge:


I know I am HORRIBLE at selling, so I simply will not sell. And it's funny, but once I truly accepted that I was going to hold this litany of lottery tickets, I became much calmer & less involved in the daily machinations & price movements. I could actually think much more clearly about the markets than I ever have. I have simply eliminated the option of selling.

And I also understand why Buffett advocates that The Optimal Holding Period Is Forever.

It clarifies, and makes buying a much more thoughtful process. I finally understand that to CAPTURE a 10 bagger REQUIRES that I hold stocks for The Long Haul, Thru Hell & High Water. The last near 20 bagger I bought took 5 years to get there & got almost cut in half 3X on the way there.

It is impossible to hold a 20 bagger when your concerned with selling at breakeven.

Second stock-related question is the Freddie-Fannie collapse.

Now, on Friday, after a heinous drubbing in the morning, both FNM & FRE staged pretty impressive rallies. Freddie actually dropped as low as $3.89, before recovering to almost $8! That's like 4-5 years of appreciation in 1 day.

And consequently, The End Was Declared as having come and gone Friday morning. My Lord, they trotted out Bernanke, Bush and a litany of minor Senators to jawbone this thing higher. And to good effect.

But this changes NOTHING. Fannie & Freddie are some of the most leveraged companies on the planet & the Tsunami of credit contraction & The Great Deleveraging will take them down.

People, the Federal Government is FLOODING our financial intermediaries with money, and it does not matter. It simply delays the inevitable. Bear Stearns was not The End, and neither is this. It is simply a short-term Band Aid that lets the inflation genie out of the bottle. Last time this happened, it took the most severe medicine The Fed had ever dished out, 20% interest rates, to end it. Worst recession since the Great Depression followed, as is expected.

We're digging our own graves, and bailing out Freddie & Fannie should simply tell you that oil, food, and everything else EXCEPT YOUR SALARY, is about to do a quick double.

I am, nevertheless, buying auto dealers & big RV makers & fading this hysteria. The Worst Of All Worlds seems like it's already priced in.

OK, I'll end it this week with the headline! Yeah!

Don't know if you've noticed, but there seems to be a little landscaping problem in Bend.

Cali-bangers brought with them this sort of minimalist idea of small grass patches, surrounded by rocks & these sparsely scattered "plants"; they look like really tall grass and small shrubs, I guess. Sort of a Japanese-ish theme. Seems low-maintenance, I guess. Not a lot to mow, and the scattered stuff sort takes care of itself, mostly

Problem is Bend is hucked-full of empty houses. These things aren't getting minimal maintenance, they're getting none. And you'd think that after a long, cold Winter, things would brighten, and all would be well, and that at the very least, the lanscape here would "stage" itself. After all, many front yards are meant to mirror desert scrub.

But it's not working out that way. Let's take a look at The Eastside first:
Darnel & Moisha Estates, Tumbleweed Field

Right next to the sub $100/sf Darnel & Moisha Estates, where Bends rich, black pimp elite have chosen to "crib out", you see that The Bleeds like ta bust out they ho's more than they like to water the yard.

Sheeeeet Nigger! I want my fuckin money, you Ho bitches! I don't ho you bitches out to water the motherfuckin YARD!

Another Darnel Estates grow operation

Yeah, yet another vacant STD used as a weed-grow operation. Someone need to call Joshua Grossman to get his ass out there with a weed-whacker. Motherfucking weeds are actually growing out of the garage here.

Paul-doh buys RV makers cuz they slowly being consumed in weed bogs

I expected Swamp Thing to come out from under this fucking RV, which is being consumed by weeds.

Now moving on to Desert Skeeze:

Desert Skeeze Field Of Dreams

Besides being The Home of $50/sf Abandoned Hulks, Desert Skeeze got the Weed problem. I can only imagine the woman of this house got a motherfucking humungous bush, look like she got Buckwheat in a leg-lock.

Classic Desert Skeeze backyard. Or is it Forum Center?

Drive by The Skeeze & Forum Center you'll see an entire block of vacant homes being consumed by weeds. It's a sea of weeds that runs the entire block at Forum, uninterrupted by fences or other impediments to offend the eye.

Hay fields in Bend?

Yeah, this Coldwell broker might wanna hire a band of illegal methers to come out and whack down the fucking hay field that sprung up here. What'll happen if they don't?

Notice on yo front door when you don't trim the bush

NIGGA PLEEZE! Nigga know you gotta keep that bush trimmed, or you be scarin' away Whitey.

Holy Shit, Buckwheat spotted on The Westsiiiiiiiieede!

Yup, they be weeds sproutin on the Westsiiiiieede as well. You drive by Newport Market, and you can see that these Westside macro-shacks be in need of illegal landscaping. White bitches: You just need go to Madras, pick up 'bout 200 illegals (even millionaire methers will cut yo mutha fuckin yard for 5 bucks cuz dem bitches done communicated with Jeebus when they out dying in the AZ desert. He toad 'em "You Mexican bitches will go forth & cut Whitey's yard for 3 bucks plus tip, and you'll like it, or I smite your asses with NO MORE tiara's for graduation and no more humungous pink fake silk square-dancing dresses for bridesmaids. Now Go!"), and get them fuckers to trim your yard.

Eco-Modern Whorehouse

Yup, guess we should have known the Eco-Modern Soviet-designed whorehouses across the street from Newport market would go to seed. This is where they really get you wondering if this is landscaping or fucking weeds.

Yeah, it's weeds. But they mix it with that 12ft tall grass & the weediness is actually muted some.

Fuckin Cracker be Pimpin'

Yeah, here you got a flop house, run by Cracker Ass Cracker. Clearly Cracker don't know that Whitey like a mowed field.

Yup, I got more, but you get the idea. The Vast STD fields have finally been abandoned to the elements. Ain't got the cash for upkeep. Fuck, ain't even making the mortgages anymore.

THIS, my friends, is why Bend is headed to $50/sf.

Sunday, July 6, 2008

Guest Posters Wanted!!

Well, clearly The Outrage Of The Week has to cum from COBA & The Bend City Council. Excerpt from the comments:

Builders may get more time to pay Bend SDCs
(subscription req'd)
"The Bend City Council will get a look at a new plan Wednesday that would give builders a nine-month window to pay system development charges, a move designed to help residential and commercial builders get through the current economic downturn. While many of the efforts have been in place for a while, there are two new options the city is extending to builders for at least the next year, Community Development Director Mel Oberst said. The council will get a briefing on the issue at a work session Wednesday evening. Builders currently have to pay their SDCs, which can top $13,000 for a single-family home, when they pick up construction permits. A new plan the council would first have to approve would give builders up to nine months after picking up permits to pay their SDCs, Oberst said. For homes that can be built in that amount of time, builders hope they would be able to pay the SDCs with revenues from selling the completed homes, rather than financing the SDCs upfront with high-interest construction loans."

I just sit & shake my head at this sort of thing. From the comments:

Anonymous said...

"And, while the change will delay the collection of fees temporarily, there will be no reduction."

More bullshit math from The Bullshittin. The city will be giving a nine-month, interest-free loan of $13,500 per house to the builder. The only collateral will be the house. At best the city loses nine months interest on the $13,500. Worst-case scenario, the city loses the $13,500 PLUS the interest and ends up owning a crapshack that nobody will buy.

Yeah, looks like a real "win-win" here ...

And then read this, with respect to the Bear Stearns bailout:

Anonymous said...excerpt from the WSJ: Bear Stearns Assets Accepted By Fed Lose $1 Billion in Value "What it looks like ... is that we've socialized risk and we've privatized reward," Sen. Christopher Dodd (D., Conn.), chairman of the Senate Banking Committee, said at an April hearing while acknowledging that the Fed had little time to carry out the deal. "We're on the hook. Hopefully it doesn't happen, but we're on the hook."

What the hell is going on in this country? We are doing exactly what Dodd said. For the love of Christ, this guy is Democrat!

We are trying to turn fundamental economics on it's head. Commenter "wsj" posted a really great piece about Ted Forstmann. Here's one of several great lines:

"You've got [Treasury Secretary Henry] Paulson saying 'Oh, you see the good news is it's over.'" The problem, according to Mr. Forstmann, is that it's far from over. "I think we're in about the second inning of this." And of course, the credit crisis wasn't even supposed to last this long. "This all started in August [of 2007], and it was going to get cleared up by October. It hasn't gotten cleared up at all."

Actually, this really started in March 2007, when the short-lived subprime implosion came to light.
DJIA - 2 year

You can see this thing has not been all that bad. I think it became clear early on, that Wall Street billionaires would be taken care of. My thinking at the time was that No One could possibly bail out a situation like the one we were facing. No One.

And they did put a band aid on things, and that seemed to assuage fears of Total Collapse, for a bit. And we had a quick run from the Bear Stearns low of 11K to 13,000 on the DJIA. If you remember, I said fade that thing at 12,500, which we seemed to hit just 2 DAYS after the BS panic lows.

Anyway, this ties back to COBA, Bend City Council, and the imposing of RISK on Bend taxpayers, and cordoning off of PROFIT to builders. What we are doing is actually FAR WORSE than the BS bailout: The purpose of the BS bailout was to calm markets & restore some semblance of normal functioning AFTER the essential collapse of one of Wall Streets cornerstone players.

We, as in TAX PAYING BENDITES, are expected to financially SUPPORT an industry that has simply built itself into a glutted supply situation. And as I have said before, BUILDING is NOT really an industry at all. It's DUDES. Yes, it's just DUDES in pickups who know other DUDES, who know Mexicans, who do NOT KNOW SHIT, except they will work for fucking peanuts so they can expend 112% of their annual earning blowing off illegal fireworks.

Because think about it: Most companies will demand that The Corporation somehow benefit from such a boondoggle. But COBA & Bend builders KNOW FULL WELL that their little incorporation bullshit is a thin veil that allows them to appear to be building PRODUCT for the ILLUSION of somehow making a profit ON SALE.

There is NO SUCH THING. Builders are FUCKING DUDES. Just Dudes. The LAST THING they care about is selling the house they are building. They just want to siphon off money by PAYING THEMSELVES some sort of hourly rate. NO ONE HERE cares one wit about selling the homes they are building.

So what happens? Ultimately, it appears Bend is looking to become a landlord, just like The Fed. When The Fed bought Bear Stearns toxic waste, they were buying mortgages. You'll recall I quoted a pretty decent piece by Bill Fleckenstein who was pretty outraged that the US Government was going into the loan servicing business. This is where the City of Bend is headed.

Again, what happens? This country, and this town, are headed down the same path: towards Democratic Socialism.

Democratic Socialism - A leftist political ideology that emphasizes the principle of equality and usually prescribes a large role for government to intervene in society and the economy via taxation, regulation, redistribution, and public ownership.

As usual, I just sort of wonder how can I benefit from this. How? Seems the answer is similar to How do I benefit if I am living in commie Russia in 1975?

Leave. Get the hell out.

I'm not sure there is anything to do when government bodies CAN & WILL bail out private investor losses of any and all types. The City of Bend will INEVITABLY begin to have a stake in the private ownership of homes, government housing. Believe me, government housing DOES NOT WORK. It is synonymous with DRUGS & HOMOCIDE. That's ALL that goes on in gov't owned housing.

We are entering a dark, slippery slope. The loaning of money is really only meaningful if there is some onerous, burden of repayment. Paying it back is THE ONLY sufficient impetus for the RE-LOANING of money. When borrowers default en masse, and there appears to be no further real enforceable incentives for repayment, the jig is up.

The whole depositer & borrower scheme just implodes. And banks are just middlemen in this process, who don't REALLY have anything of their own. They have OUR money, that's it. And they all hopped on the "abstraction of ownership" bus over the past 3-4 years, taking PROMISES TO PAY, cutting, slicing, dicing, and reselling them between each other, and making a hell of a lot of money doing it. THIS PROCESS was pivotal in creating the credit bubble.

No one knows who owns what, or who owes what to who.

The Great Deleveraging is going to sweep away this entangled mess. There is more collapse waiting in the wings.

THERE IS ANOTHER BEAR STEARNS COMING. Mark my words. Bernanke, Bush, BendBB and other PERENNIAL OPTIMISTS will tell you over & over & over that this thing is NEAR OVER.

Ain't NEAR OVER. This thing is the Greatest Financial Calamity of All Time. Hell, Forstmann says we're in the Second Inning. He's even more pessimistic than I am.

For the love of Christ, we are in the throes of some sort of Biblical Seven Horsemen of the Apocolypse. We can't eat CORPORATE PROCESSED FOOD, for Gods sake! They can't even figure out what's the root cause of the biggest poisoning of Americans EVER.

I mean marge & them were talking about GARDENING AS A FOOD SOURCE, something about which I sort of chuckled about 2 months ago.

Now? Fuck, now I am asking my wife about how to plant OUR FOOD in the back yard.

THIS is another trend that I think is very interesting, and it has less to do with a poisoned food supply than it does gas & transport costs.

The One Thing PRE-SOCIALIZED America could do pretty well, was look at their own income statements, look at the high-cost items, and DISINTERMEDIATE THEM. Get rid of them.

Now, The High Water Item Everyone Wants To Get Rid Of, is fuel costs. Transport. We pay billions to ship all sorts of stuff All Over The Place. We pay a hell of a lot to ship food to this country. Timber? Again, millions to ship here, mainly from Canada. Look around your desk; there was probably $.10-20 of every dollar spent to ship that stuff around, INCLUDING your gas money to go get it at the store.

Think about what Exorbitant Transportation Costs mean. Can you think of a time when transport costs were truly mond-boggling? Try 1,000 years ago. Overland treks could cost you your life. They took major chunks of your life.

What about space travel? Going to Mars or something.

OK, when transport costs become outrageous, we do it FAR LESS, and we try to be Internally Self Sufficient; ie we bring all our shit with us. We have to be able to make stuff, fix stuff, and soldier on By Ourselves.

This seems to be where we're heading. Communes. The Texas Polygamists. Internally self suffiecient units that make & build they're own supply of just about everything, including food.

Small lots, small runs of production of a wide variety of items. No HUGE corporate industrial food suppliers trucking & shipping stuff Worldwide, because the ALTERNATIVES are cheaper: buy seeds & plant it. Little socialized farms. Rural China is what we're turning into.

I don't know. I just try to look at what is happening & deduce from Standard Human Nature & what I know about it, to figure out The Big Picture. We might be real shitty at a lot of stuff, but Americans as a group are a damn crafty bunch, and our economy, with its heinous inherent flaws, is pretty good at allowing people to do what the hell they can to make a living.

And we will beat this fuel problem not really by any sort of Reduction Planning, but by Elimination. We simply will NOT ship things. We'll produce it locally.

An example that just popped into my head is produce in Alaska. You wanna see truly ridiculous costs & poor value, head up to the outer reaches of Alaska & (try to) buy produce. It's awful, barely edible stuff. And it costs a fortune.

What to do? Small greenhouses? Social gardens protected by the elements somehow? There's money in them thar hills.

A LOT of people have gotten on here & said that I am trying to somehow INFLUENCE PEOPLE'S DECISIONS, OR SOCIAL POLICY, or some weird ass shit like that. Of course I am not. I am trying to read The Big Picture, INTERPRET social policy, and combine it with my ideas about human nature (self-centered searching for utility optimization) & figure out WHAT WILL BE BOUGHT in response, if anything.

We are socializing the building of homes in Central Oregon, taxpayers will own, in part, several homes as a result of tragically flawed City Council enactments. What to do? Property management? I've said before I think this is a good way to go in Cent OR. Move out cleanups? Again, the methers LOVE to turn on the water & plug the sink 2 days before their lease is up. Motherfuckers LOVE to leave landlords a swimming pool.

There seems all sorts of Management & Remediation Businesses that will result of bend City Councils actions.

This rationale also seems to apply at the Federal Gov't level: We are BUYING MORTGAGES at an untold rate. What to do? The Fererales LOVE to hire contractors to manage their messes for them. Fuck, that's really ALL Soviet Russia was.

Speaking of which, they also produced & consumed ENORMOUS amounts of alcohol. Buffett, you sly devil!

We're in the throes of transforming the US Economy folks. I know it doesn't seem like it, but have you actually considered GARDENING a proper use of your time in ANY past years? I NEVER have. It's STILL sort of on the border.

But fuck, that means we're entering into a WEIRD ASS AGRARIAN phase. I mean, WHAT THE FUCK? AGRARIAN? That shit was put down 200 years ago, right?

Again, the after effects of this fucking housing bust are going to be weirder & more severe than we ever thought possible.

OK, you might think that all this talk about the deleterious effects of High Costs as sort of abstract & maybe irrelevant, but there is an industry in the country that has stoically maintained ridiculous wage levels for it's rank & file, far above the competition. Here's an excerpt:

With barely four months to go to the day of the US presidential election, the BBC's James Naughtie finds Americans worse-off than they were seven years ago - and worried about the future.

East Grand Boulevard in Detroit is still handsome, in its way. There are wooden and brick houses on spacious plots, with trees front and back. They have that early 20th Century confidence that American architects were able to exploit, with high chimneys, wide porches and plenty of room inside.

But many of them are not homes any more. They're empty, bricked up, maybe open to the sky or burnt-out. As a street, it represents a generation of inner city decline.

You can find plenty of prosperity around the edges of Detroit. But take a trip down East Grand Boulevard and into the enclave of Hamtramck, which was the heart of the American car industry, and you can sense the economic angst that's gripping the country.

It's not simply that there is poverty in Detroit - which you can find at the busy soup kitchens that were established in the Great Depression - but that a city which once boasted some of the best-paid industrial workers in the US is in steady decline.

Politics in Detroit is a mess - the mayor has just been deposed by his own Democratic supporters over his use of public money to try to cover up an extra-marital affair - and economic prospects are bleak.

People who thought they would remain reasonably comfortable are discovering that rising medical bills, falling wages and petrol at $4 a gallon are making life difficult. Add to that the pressures from the banks and mortgage lenders, and you find trouble.


More than 73,000 homes were repossessed in the city in the second half of 2007 because the owners couldn't keep up with loans: Detroit is a prime example of a contagion that's sweeping the whole country.

In the course of this year, between two and three million homes are expected to be the subject of "foreclosure".

This is one of the painful facts that lie behind the rhetoric of the presidential campaign. The reason why both John McCain and Barack Obama talk about "change", is that most Americans feel that this election year marks some kind of watershed.

They're not agreed, of course, about which way the country should turn. But there is a general sense that after the eight Bush years, in which the country has been tormented by post-9/11 national security worries and war, and in the course of which government spending has soared and personal debt has become an obsession, this electoral choice will be important.

Searching for the worries that give rise to that belief, you first of all confront the lack of economic optimism.

Although you can find those who talk of a cycle that will turn once again, about the long-term inevitably of recovered prosperity, it's much easier to find people who are starting to question their birthright. Is it true, as they've always been taught, that the next generation will always be better off than the one before it, that hard work will produce rewards and the freedom to choose a lifestyle?

In short, is the American Dream still in business?

'Katrina-like crisis'

I found in Detroit that there are doubts. Among car workers, who were once the elite of the labour force, there is deep gloom.

While I was in the city, a strike at the component manufacturer American Axle was settled with a deal in which the workforce accepted much lower wages and health benefits. They got what they could, and it wasn't much.

Talking to some of those who are losing their homes through foreclosure, having stumbled into loan agreements that allowed interest rates to be ratcheted up, I became quickly aware that the problem is not one that is confined to what might be called, over-simplistically, an "underclass".

As one woman put it, it's a "Katrina-like crisis" - the waters are lapping around the feet of those who never thought that their homes would be inundated.

In America, it's always important to balance bad news or public anger with the country's innate capacity for ingenuity and recovery. But, as Joe Stiglitz, Nobel-prize winning economist, put it to me: "The reality of each generation being better off than the last is becoming destroyed."

Most Americans, he says, are worse off than they were seven years ago. So, when they come to make their political judgements this autumn, this is what will affect them most.

Remembering the effectiveness of Ronald Reagan's question in 1980 after Jimmy Carter's four years - "Are you better off than you were four years ago?" - you realise how important this is. Many Americans aren't convinced that this downturn is another blip in a cycle that will quickly correct itself; they worry about something deeper.

They know that China holds much of America's public debt, and that jobs are going overseas. And they're aware that the weakness of the dollar overseas can be seen a measure of the troubles of the superpower.

They wonder, therefore, whether they can assume that in the 21st Century their country will remain an economic superpower, even if its military strength is still unmatched.

It's a deep question, lying far beneath the surface of a presidential campaign in which the personalities of the candidates and a speech here or there often determine the headlines and the tone of the exchanges.

The truth is, this is a troubled nation. And one of the problems is this: change may be necessary but where should it lead? In the next four weeks that's what I'll be trying to find out.

You might say, "Hey, the car business is a TERRIBLE EXAMPLE! It's old & industrial, it was bound to fall apart"!

Umm, no. Look at Honda & Toyota.

The market cap of GM is $5.8BB. Ford is $9.9 billion. Yes, Ford is worth about twice what GM is. Weird.

But Toyota is worth $144.9 BILLION. Toyota is worth 25X what GM is. Honda is worth $61 billion.

There is HUGE amounts of value being created in auto assembly. But US automakers have had to deal with a century-old suckerfish: UNIONS. Unions have jacked up the cost of every single car made in this country to the point that the industry has been destroyed, AND THE ENTIRE SURROUNDING AREA where they are built has been 100% destroyed.

If you're a freaked out self-delusing liberal, keep telling yourself that THE UNIONS ARE NOT THE PROBLEM, IT'S THE GREEDY CORPORATIONS! OK, settle down Tim Robbins.

All corporations are greedy. You're greedy. I'm greedy. And corporations are JUST US.

Anyway, if you want a PRESENT DAY example of what non-competitive cost dynamics can do to a city, state or country, just look at Detroit. It becomes less & less relevant, less & less able to sustain itself, and decays more & more until it is simply abandoned.

WE, Bendites, are living in the Next Detroit. Oh yes, the Auto Unions succeeded brilliantly, but they have killed the hosts. Bend City Council will succeed in perpetuating the Suckerfish, BUT THE HOST WILL DIE. Iran and Russia are succeeding brilliantly in feasting off the host, but it will INEVITABLY DIE. The Saudis understood this.

Massive hyper-inflation, and stagnating growth; Worst of all Worlds. We're headed for disaster. What to do?

Remember the fundamental: People in a "free" society maximize their own utility. We get the most for our money. We purchase the low cost to disintermediate the high cost. And salmonella is a COST, just like oil.

So what are The Costs? What is Their Origin?

It is BIG BUSINESS. Corporations. We've endowed these things with sustaining our lives. Big Oil. Big Food. Big House. Big Computer. We're going to start disintermediating these enterprises. Small lots. Short runs. All is Local. Can't afford even to pay South American peasants 2 cents to pick bananas, cuz it costs $20 to ship them here. All is LOCAL.

We will work in Bend. We will be taxed to pay builders for unsaleable homes. This is a fact. What to do? Leave. Leaving is all we can do to disintermediate the cost. WE will be Detroit. We'll still be here; Detroit is still here. But things will look different.

Bend circa 2015

On a different tack: I will ask again, does anyone want to write a Guest Post? C'mon! It's got all your standard chunks of Reaping The Goodness Of Fame! Getting whaled on by Buster! Being Told Your A Lunatic! Absolutely NO Monetary Payoff!

It's fantastic. I wanna hear from YOU! I'm going to setup an anon email, & YOU TOO can be the next contestant on BendBubble2. I truly suck, and I know it. I think my strengths lay in CONVINCING people that The End is Nigh, but that phase is clearly over. The Chronicling of The Calamity is where we are, and I question my ability here.

AS you can tell from my recent comments, I play the other side of stuff: I load up at the bottom... and typically unload somewhere just off the bottom, about 1% above my breakeven. So I tend to become progressively more optimistic as things collapse. THAT is why I believe in Detroit: ALL THE BAD NEWS IS OUT THERE. TWICE. Can't really get worse. Even an open field is worth more than what is there now.

I am actually starting to fade the oil hysteria. I bought a bit of Monaco Coach this week.

MNC, 1 year

To repeat, this ain't for everyone. I have sort of a Taleb-esque approach to things: Spread 10-20% of your portfolio across a thin veneer of lottery-ticket style holding, and hold the rest in cash. And going from $16 to $2.86/sh in one year qualifies as a lottery ticket in my mind.

I am becoming more optimistic AS THINGS IMPLODE, as is my nature. I am compelled by LOW COSTS to buy things I wouldn't touch a year ago. And things are beginning to get cheap, fast.

So I wonder if I am The Prophet Of Doom this blog seems to require. I am STILL HORRENDOUSLY BEARISH ON BEND. I can't possibly understate that. Bend is the Detroit of the 1960's: Doing OK now, but literally facing it's own long term doom. Barring a complete cleaning of house, Bend will self-destruct.

We need to adopt the Economics of Small Lots & Short Production Runs Of a Wide Variety of Goods. We need to become Self Sufficient. We are an island. We're a spaceship headed for Mars. Well, we need to act like we are, because we are incurring all the same costs.

I don't know. Costs need to fall precipitously here for me to switch from Rent & Invest The Difference, to Buy Bend. So maybe I can gab on about the Fall of Bend, which will stay the course for at least 5-10 years.

But I would like to post different ideas here. What will work? What will kill this place? Some people seem to have a good handle on things that I don't. I'd like to post pieces that present a variety of positions. Even RE-friendly stuff. If I got enough, I could post more than once a week.

And this blog is getting tough for me to keep up. I've eaten my own pudding, and positioned myself "delta negative" on this housing collapse, and I am also Renting & Investing The Diff. And I am busy because of it. I am working more than ever. I used to have a spare couple of hours to even think about housing issues. Now, I am just working all the time. It's becoming difficult to take 5 seconds to write anything.

Anyone want to help? Write a guest piece? Doesn't have to be totally agreeable to me or the bent of this blog. I just want a diversity of thought & opinion.