Getting Millennials to Buy without Providing the Means

There are Four Expectations of every living, breathing American adult...

You are expected to work, pay taxes, obey the law and consume.

Anything beyond that, and no one really cares what you do.

When you work, you are not only generating the revenue to pay taxes and consume but usually are so absorbed in your own life and hopefully to government, so utterly exhausted at the end of each day, you don't have time or interest to follow the daily corruptions and economic Lies they spew..

A remote channel 'click' -- that took care of that..

~ How cool.. four people talking to others but not each other inches away

When you pay taxes, obviously it gives the government the revenue necessary to throw away on needless war and other frivolities most people would never willingly pay for if allowed to directly specify what areas of government were to receive their taxes.

And obeying the law is obvious-- no one wants others to do them physical, emotional or economic harm.  Of course government isn't so much concerned with that-- it is more interested in making sure you don't galvanize protest and do so publicly..

Quite OK to say whatever you wish in protest "pens" far away from where the targets of such demonstration may hear..  Better yet, pick up a stuffed teddy bear in the privacy of your home and scream at that..

Just don't find like-minded people who share the anger and build a consensus then a larger movement-- That has to be stomped out.

And oh yes.. the fourth thing -- Consume.

And on that count, government and the Fed is worried.

See, we're not consuming enough, especially the 'Millennials"

From Yahoo News:

"They’re narcissistic. Apathetic. Pampered. And addicted to their four-inch screens.

If you believe the conventional wisdom about the millennial generation — those 16 to 34 years of age, by most calculations — you’ve got considerable reason to worry about the future of the U.S. economy.

Millennials show far less interest in buying cars, homes and other big-ticket items than their parents did at the same age, which has generated an intense effort among companies that produce those things to crack the code of these crazy kids and figure out how to sell them stuff."

That means more insipid commercials filled with taglines and awful puns, where strategically every race, gender, ethnicity, sexual orientation and age demographic is represented in a 15 second spot...

~ More 'cool' kids socializing w/ others far away and not each other...

Because we all know all it takes for a Hispanic or lesbian or a Sikh to buy a product is seeing a representation of them in the far background smiling goofily at a car or truck since we must be all too stupid to buy something for real reasons like price or quality or value...

But we digress...

"Millennials seem to scoff at the open road. The percentage of 16-to-24-year-olds with a driver’s license has dropped sharply since 1997, and is now below 70% for the first time since 1963...

Millennials, as a whole, are also buying homes later than prior generations, having children later and delaying their careers. It’s as if America’s youth are rejecting social conventions that generations have held in common for decades...

~ iPod buds shoved firmly into ear canals to block out life

The national unemployment rate is 7.5%, but it’s 16.1% for 16-to-24-year-olds. Many baby boomers are working longer, to rebuild wealth lost during the recent recession, which has pushed the retirement age to the highest level in more than two decades. That has reduced turnover in the labor force, further limiting openings for younger workers in an already challenging job market."

As Scooby Doo would say, "Ro-Ro!"  (Uh Oh ! translated for adults)

Its the greed and short-sightedness of the system that has altered the spending habits of a generation of young people.

No one in power has the guts to come clean and admit going to college is an Utter waste of money and most should not be attending.   And parents don't seem to possess original thought so they keep pushing it on their children..

As a result many, many young people attend, party hard and leave with a degree in worthlessness and debt that shackles them Forever...

And no one in any position of power wishes to create meaningful jobs that pay a good wage.  Everyone is content with us being a finance economy filled with lots of temp jobs or a  service economy or an entertainment and porn economy.. anything but a manufacturing one.

In reality, this has been going on for generations but is just more dramatic in the present--  this expectation that everyone must start at the absolute bottom with shit wages and no benefits and work, work, work their way up slow and incremental in little turtle crawls until by the time they make good money, they are choked with bills and responsibilities, hate their job and hate their life..

~ $300 noise-reduction headphones to block out other 'humans'

Doesn't matter if you're brilliant or super-talented or exceptional.. Nope-- bottom.  No exceptions-- Everyone climbs the ladder and sells their soul rung by rung...

Besides, no boss has a strong enough ego and self-esteem to hire the person who will ultimately replace him/her...

So what has happened is this:  Young people are desperately needed to consume yet not given the jobs to create the wages needed much less enough income and social security taxes to keep the ball rolling and are tens of thousands in debt before allowed to take their first legal drink at a bar...

And because most young people are docile and express frustration in cellphone keystrokes rather than outward expression i.e. protests and sit-ins, few to none know or care of their concerns or how their future is being systematically taken from them.

One of the most popular little sayings from President Kennedy came from his Inaugural address where he espouses, "Ask not what your country can do for you, but what you can do for your country"

Its clever.. has a nice cadence.. but it is also utterly wrong...

Especially today.

If government wants to have so much power and control over our lives and constantly look to curtail our freedoms and liberties and steal more of our money via higher taxes, then it owes more in return than a shit slogan that we the people should make no demands upon it.

The correct slogan should be "Ask not what I should do for my country when my country does not care of me.  Ask what my country shall do to improve the quality of my life, and to make it so"

Squeaky wheels get the grease

Housing: Pretending its 2005 again & Forces of Economic Gravity

While perusing various news articles on housing, I came upon this little gem care of a local ABC affiliate in San Francisco:

"According to DataQuick, compared with the first quarter 2012, sales prices for the 1st quarter of this year have jumped 26 percent in East Palo Alto, 28 percent in Antioch, 34 percent in Union City and a whopping 51 percent in East Oakland."

That's in a 12 month period.

If that stat doesn't conjure up the word 'bubble', we're not sure what will..

It is abnormal for home prices to increase 26 to 34 percent in a one year cycle, much less 51% increase..  Those values occur based on speculation and flipping.

The graph above shows housing prices between 2002 and third quarter of 2005 for a specific county in Florida called Volusia.  In 2002, the median price of a home was $108,300.  Three years later, after continual 30-50% spikes due to flipping, it was $208,200

A person who bought the home in 2002 for $108,300 and put down a deposit of $25,000 with the rest as a 4% mortgage for 30 years ended up making monthly payments of $349.95

The person who bought the same home 3 years later after those G-D flippers spiked the home value to $208,200, based on the same $25k down and the same 4% mortgage ended up making monthly payments of $874.62

And who do you think is more likely to default on their mortgage-- someone paying about $350/month or someone paying about $875??

Now if you're a seller, you're going "Yay..Bring on the Jubilee"

Of course that mindset can be quite naive.. As if the inflated home prices only work to benefit sellers and when one becomes the buyer, suddenly they're immune to the price gouge.

Everyone wants desperately to believe its 2005 again..

No one wants to remember 2008..

No one wants any reality or Truth to get in the way of their single-minded pursuit to make as much money as humanly possible while on their short time on Earth before God calls them away and leaves everything hoarded behind for tax collectors to sift through.

~ Issue from 6-13-2005 - "Why We're Going Ga-Ga over Real Estate'

Its both funny and maddening..  Home prices back in the peak of the last popped bubble were overall inflated by 30-50%.  They weren't the Real market values.

But people didn't like seeing the drop.. Didn't want to acknowledge the reality that the home prices of 2001 which post-bubble dropped back down by 2011 were the accurate valuations.

So they now celebrate the re-emergence of the housing bubble as if it will raise prices back to where it once was and should have stayed rather than seeing the truth that it never should have risen that quickly in the first place!

There will always be home sales..  No matter how good or bad things are; Always be buyers and sellers.

And if there's a period of time where sellers want to sell but refuse to because they would rather be foreclosed upon then take a small profit or break even on a transaction.. Well-- ultimately every seller does sell creating a glut and plenty of scavengers i.e. investors and home flippers ready to swoop in.

True story... We knew someone who back during the Bush years was heavily into buying and 'flipping' properties.  And this individual truly believed the increasing home values would go on forever.. For privacy sake we won't mention the person's name, age or even their gender..

But suffice to say, when the bubble 'popped' this individual was woefully unprepared for the consequences..  Ultimately the only option was filing for bankruptcy.

~ The red line is the Home Price Index 1890 to 2005; the dark-blue line is population growth...

We were told by this person that at the time of filing, this poor soul had possession of 5 homes-- one of them was that individual's legal address and the other 4 were homes purchased with the intent of flipping.  We found out each home had been bought with merely 3% down and the other 97% mortgaged.

So between the four homes, it would be a fair estimate to say banks were on the hook for at minimum half a million dollars ($500k) they'd never recoup from the mortgagee, but would have to hope to get some percentage back during the foreclosure and re-sale process.

And this acquaintance was not exceptional in any way shape or form

This person was the Norm.

This Chart shows what happened to housing after the unexpected 2008 crash.  The red line is 'Residental Property Values'.. the dark line is 'Residential Mortgage Debt'..

Because the Federal Government and the Fed refuses to allow the banks to take losses and allow home prices to naturally fall to pre-2002 levels, you now have a repeat of the mid 2000's both for professional vultures and for everyday folk..

It always happens-- greedy people who aren't content or fulfilled living a comfortable life, seeking greater fortune and thinking they know it all, then crying the loudest when it goes belly-up..

Always forgetting economics work in cycles.

Even the Fed can't fully manipulate that.  It certainly can manipulate the Highs..  It just means the ultimate drop will be more painful.

Call it Economic Gravity.

Greater US Home Sales; Fewer US Home Buyers

Market is down today-- good..

Not a four-figure drop but.. its something.. and yet nothing worth writing about.

So we want to take a moment or two and go back to addressing yesterday's post-- all that BS excitement and happiness that home prices have risen the highest in 7 years.

We explained yesterday many reasons why its all a mirage and this has really no impact on everyday people trying to sell their normal homes to buyers..

But we wanted to address one more reason all that glee doesn't matter in a real world, everyday American sense...

While there may be a greater number of homes being sold today than that the worst part of the current recession-depression,  the sellers may be Americans but the buyers of those homes, mainly the higher priced ones, are Foreigners.

We don't mean immigrants..  That wouldn't be a bad thing..

No we mainly mean foreigners for investment purposes.

There are many websites catered to attracting people in foreign countries to buy up US properties to hold onto for a profit later on..  If you're curious to see, we list a couple below..

http://miamiforrussian.com

http://uschinarealestate.com

So if you go on these type of websites.. pick out your luxurious home or spacious condo-- one that half the time you won't even bother to live in and then buy it.

And everyone is happy--

The buyer is able to hide his/her wealth from the tax collectors of their nation since foreign real estate purchase is just another means of off-shore dumping money...

The seller is more than happy-- usually by this stage its the bank selling the property which was foreclosed upon..

The real estate agent is super happy to be getting a nice commission for really doing little to nothing but assist the foreign well-to-do in deceiving his/her own government..

And all those rats, roaches and other pieces of Shit that profit off Wall Street love hearing how the real estate market is now 'fixed'...

Everyone love it except well.. Americans.  But what do they know.. Our economy is so horrible, most really can not afford new homes.

More people are re-financing mortgages than taking out new ones and even that number has been precipitously dropping even with rates gradually increasing..   Funny isn't it.. all interest rates to make purchases are slowly increasing but the base interest rate set by the Fed keeps Decreasing..

Corporate media makes no mention and thus no one minds..

Let's go back a moment to yesterday..   In Case-Schiller's top 20 city index, Miami was listed at #10 in the nation, experiencing a 10.7% increase in home sales..

The following is from the Miami Herald, 11/7/12-- We think the information is still relevant to the points we are conveying (in blue font):

Venezuelans continue to make more international real-estate purchases in Miami than any other foreign group, 16 percent, while Argentineans have leaped to second place with a 15 percent share, and Brazilians rank third at 14 percent, according to a new report from the Miami Association of Realtors...

 Foreign buyers have played a vital role in lifting Miami out of the depths of the real estate downturn, and the agents came to network and to tap into the city’s allure to international investors and vacation-home buyers.

“I have clients there [in Fortaleza, Brazil] who want to buy here,” said Geovania Heller, one of many Brazilian real estate agents who attended the session Monday. “Prices are still better here than in Brazil.”

Real-estate agents from Russia, Ukraine, Germany and France, among others, joined with a large contingent of Brazilian brokers for the three-day event...

All told, Latin Americans accounted for 70 percent of the international real estate transactions in Miami and Miami Beach. Western Europeans accounted for 18 percent of foreign sales...

Francisco Angulo, an international specialist with Coldwell Banker in Miami Beach, said discretion is important in dealing with Venezuelans in their home country. Forget about taking out a newspaper ad to tout a seminar on buying real estate outside Venezuela: “Nobody will show up,’’ Angulo said. “People want to be low key.’’"

So really this is as good an example as any why the US is becoming a third-world nation.  Others are coming here to gobble up our real estate because our prices are cheaper and home purchasing is a legal means to launder money.

Remember, we mentioned a few months ago there's a loophole in the Patriot Act where real estate agents are not legally bound to inquire where the money comes from on foreign real estate transactions where other entities would be if large amounts of foreign funds were entering the nation.

And understand this-- this post isn't about Xenophobia..

Its actually a severe attack and indictment on the US-- its government and financial apparatus.  This perpetual con game played upon its populace like you would find in non-democratic governments..

No one ever wishes to admit things are bad, much less even a problem exists.. And no one wishes to be honest enough to explain that solutions are ultimately more harmful.

Honestly, who gives a damn in the US housing market is healthy if a vast majority of Americans can't even afford to be players in the real estate game.   They must learn instead to be content to be perpetual renters.

We say this axiom often... 'The Squeaky Wheel Gets the Grease'

When its corporations or Wall Street, they squeak horrendously loud and have direct access to those in the positions of power and influence to ensure they get all the 'grease' their lice-ridden claws can clasp ...

Average people-- the only hope and its a long shot admittedly is outward open protest and demonstration.. Something akin to the Civil Rights and Women's Liberation movement, the anti Vietnam protests and so on..

This takes time.. patience... work..  Takes talking to friends and neighbors.. creating organizations and merging with others when there's common interest and goals..

There's no guarantee of being heard, but you have a better chance of having grievances addressed when its 100,000 'squeaking' at once vs one or two...

Because 'We the People' are not feared by anyone in power..

And elections just aren't enough anymore.

British Glamour Model Jessica-Jane Clement