To procrastinate is human nature. It's too bad then, that everyone thinks procrastination is a terrible thing to be avoided at all costs. I've actually found a really good reason to procrastinate- it saves me money.
Perhaps the reason America is so financially insecure right now, is the fact that we go shopping as a hobby. Instead of waiting for items to wear out, or irreparably break, or just plain out die, we wait until they are ugly (at least mentally we think so), old fashioned (meaning it still works just fine- just doesn't have all the cool features that come on version 2.0), or broken (but certainly something a little superglue could fix right up). Instead of the adage of Reduce, Reuse, Recycle, America's adage seems to be increase consumption, use once, and put in a landfill.
So the reason procrastination is a good thing? -procrastinate buying "stuff". Instead of going shopping as a hobby, learn to fix things as a hobby. Learn to mend, learn to glue, learn to duct tape, learn to make things yourself. If you switch these two hobbies around, I know you will be happier, wealthier, more fun to be around, and much better looking.
Friday, June 26, 2009
Saturday, June 20, 2009
A Buyer's Market
The Buyers Guide is written for the buyer- not the seller. So if you are trying to sell your house and you want someone to tell you the housing market is turning in your favor, sorry, but you won't find it here. No matter how much the National Association of Realtors spins the numbers we all know there is a glut of homes on the market... and we are no where near the bottom of the housing market.
Of course, if you listen to their propaganda then you might be swindled into thinking you are getting a "great" deal on your new home. Housing prices in the early 1990's were low for a reason- the real value of everything dropped. As we have seen in the stock market, housing market, commodities market, and even your local supermarket, real prices have dropped again.. and to the lows of the 1990's. The problem is, the housing market is not dropping to the prices of the 1990's- thanks mostly to the NAR and their powerful lobbyists. Unfortunately, Obama and his congress think that we should pay for these inflated housing prices. Why else would they be giving out housing grants to new home buyers? If they were giving these grants to every consumer, then it would be more fair- but they are not.. only to those who are buying for the first time, who are inevitably going to be buying at way above 1990's prices.
If you really want to be a responsible consumer and a bright buyer.. you will wait until housing prices have lowered to 1990's price levels. That is when you will know it is time to buy a house, car or anything else for that matter. You don't have to believe me, listen to any number of financial "experts" who are not being swayed by the NAR and they will agree with this post.
Lets look at this from a historical stance. The late 1990's and early 2000's is when the corporations that are "too big to fail" started leveraging their debt. Consumers did this too. Companies were growing rapidly, so people were getting really good jobs. Workers were promised large salary raises, and so they thought they should buy more of what they wanted... why else did GM sell so many HUMMERs during these years? And obviously the expansion of boating followed quickly. And now that you have a gigantic gas hog and a "cool" wakeboarding boat, you need a new garage to put it in- which comes with a new house too. Well, these workers had not quite gotten that raise, so they decided they would finance all these great new toys. During this time, stocks for financials expanded rapidly and credit companies had to ask for more funds...
So what happened? Isn't this how economies grow? NO! Economies are supposed to grow by expanding real value- new efficiencies, new inventions, new markets! This economy was artificially expanding thanks to leveraging... counting the numbers twice- once on the new purchase, and again on the financial end... not good.
Well, we all know how it happened. A couple of highly leveraged companies couldn't pay their bills- AIG, Lehman Brothers. So what do they do? they lay off employee's, the same ones who had been promised large salaries. The same ones who bought the HUMMER and the boat, and the new house. So what did these firees do? they went to their local paycheck loan center and leveraged their next paycheck. Well, when people can't pay their bills, they lose stuff that is not theirs- cars, boats, houses, etc.
The artificial increase in value- commonly called a bubble- had popped. The housing bubble is still losing hot air today... and the bubble will not be gone until prices are down to 1990's levels.
Of course, if you listen to their propaganda then you might be swindled into thinking you are getting a "great" deal on your new home. Housing prices in the early 1990's were low for a reason- the real value of everything dropped. As we have seen in the stock market, housing market, commodities market, and even your local supermarket, real prices have dropped again.. and to the lows of the 1990's. The problem is, the housing market is not dropping to the prices of the 1990's- thanks mostly to the NAR and their powerful lobbyists. Unfortunately, Obama and his congress think that we should pay for these inflated housing prices. Why else would they be giving out housing grants to new home buyers? If they were giving these grants to every consumer, then it would be more fair- but they are not.. only to those who are buying for the first time, who are inevitably going to be buying at way above 1990's prices.
If you really want to be a responsible consumer and a bright buyer.. you will wait until housing prices have lowered to 1990's price levels. That is when you will know it is time to buy a house, car or anything else for that matter. You don't have to believe me, listen to any number of financial "experts" who are not being swayed by the NAR and they will agree with this post.
Lets look at this from a historical stance. The late 1990's and early 2000's is when the corporations that are "too big to fail" started leveraging their debt. Consumers did this too. Companies were growing rapidly, so people were getting really good jobs. Workers were promised large salary raises, and so they thought they should buy more of what they wanted... why else did GM sell so many HUMMERs during these years? And obviously the expansion of boating followed quickly. And now that you have a gigantic gas hog and a "cool" wakeboarding boat, you need a new garage to put it in- which comes with a new house too. Well, these workers had not quite gotten that raise, so they decided they would finance all these great new toys. During this time, stocks for financials expanded rapidly and credit companies had to ask for more funds...
So what happened? Isn't this how economies grow? NO! Economies are supposed to grow by expanding real value- new efficiencies, new inventions, new markets! This economy was artificially expanding thanks to leveraging... counting the numbers twice- once on the new purchase, and again on the financial end... not good.
Well, we all know how it happened. A couple of highly leveraged companies couldn't pay their bills- AIG, Lehman Brothers. So what do they do? they lay off employee's, the same ones who had been promised large salaries. The same ones who bought the HUMMER and the boat, and the new house. So what did these firees do? they went to their local paycheck loan center and leveraged their next paycheck. Well, when people can't pay their bills, they lose stuff that is not theirs- cars, boats, houses, etc.
The artificial increase in value- commonly called a bubble- had popped. The housing bubble is still losing hot air today... and the bubble will not be gone until prices are down to 1990's levels.
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