Looking Out From the Garage: October 2008

 have been noticing something. 

Joe the Plumber SCARED Barack Obama...

Now, I'm sure that Obama wasn't frightened as he stood there and talked with Joe... but have you noticed that since that appearance, Obama has not wandered around in places where people might answer unscripted questions?  That was the last time that Obama appeared among the unvetted. 

Joe did something that Obama didn't like... he asked a question that Obama wasn't ready for.  He thought that as he walked along in a working class neighborhood in Ohio, he was among his supporters... and then Joe asked his simple question... and Barack revealed that he thinks it is not just OK, but desirable to take money from one group of people (those that earned it) and give it to another group of people (those that didn't). 

That wasn't in the script. 

Who's hidin' Biden???

And then there was "the interview."  And since the interview, and the numerous other comments that Joe has made over the last few weeks, it seems that Boden has been clamped down on.  No more fundraisers with reporters present.  No more media interviews.  Apparently they have started giving him a teleprompter to try to keep him on message in stump speeches... and he isn't doing as many stump speeches as he was. 

Unlike Obama, who is very good at not stumbling over himself and revealing that which he doesn't want to reveal (Joe the Plumber aside), Joe Biden doesn't seem to need much help.  He seems willing to say damaging things without help. 

Don't look for Joe Biden to show up anywhere that he might have a "rhetorical flourish." 

Maybe Joe will come out and tell us about how FDR got on TV after the stock market crash, live from the Oval office to comfort and support the American people.

So...

After all of the abuse that Obama and his supporters put the McCain campaign through for not giving Sarah Palin over to the media, it seems that now it is Obama and Biden that are hiding out and only getting in front of friendly and controlled crowds. 

• Source 1
• Source 2
• Source 3

I was out with my young son a few days ago and had an encounter with the supporters of a political candidate... and I wasn't happy.  Not happy at all... 

There are a few ground rules that you need to follow as you promote your candidate:

• Don't approach children without the parent's permission!
• Don't offer items to children without the parent's permission!
• Don't give your talking points to a child without the parent's permission!
• Don't argue with a 4 year old when he nails you on your candidates character!
• When the parent tells you that your candidate is not their choice, don't call them a racist.
• When the parent tells you that he doesn't appreciate you trying to indoctrinate their child, don't call them ignorant. 
  
• When you don't actually know the positions of your favored candidate, you might want to stay home from working the crowds.
• Don't say loudly to your "co-supporters" that the guy over there is just an other "ignorant rasict because he won't support your candidate.
• Just because your candidate tells you to get in the face of your neighbors and argue with them doesn't mean that you can do that without consequences. 
  

So, here is the drill...  An Obama supporter approached my child and asked him if he wanted a T-shirt... all they had were kid's sizes, so this was obviously their goal.  I told her that I didn't appreciate her approaching MY child without talking to me first.  She actually ignored me to tell my son to tell me to vote for Obama... 

Now, had it not been for my son, I might have been able to walk away.  But, the little guy had a statement...

"My Mommy always tells me that I need to pick my friends carefully... I might be a bad boy if my friends are bad boys."

She had the nerve to argue with a 4 year old about that...  I took over. 

• William Ayers... and don't give me the line about him being 8 years old.  He wasn't 8 when he launched his political career in Ayers' living room... and Ayers was still unrepentent about his role in killing Americans. 
  
• Frank Marshall Davis... Frank the Poet in Obama's book... a communist at the very least.  And since Obama says in his books that he attended a lot of socialist and communist events, that isn't a shocker.
• Rashid Khalidi... reputed to be a spokesperson for the PLO... back when they weren't a "peaceful grou", but when they were actively commiting acts of terrorism.
• Tony Rezko... Convicted felon now, and Obama supporter... served on his finance committee back when Obama was in the IL State Senate.  Obama claims that they barely knew each other, but they knew each other well enough that he raised money directly for Obama. 
  
• ACORN...  We get a new version of history each time someone uncovers something that Obama can't deny.  

It went downhill from there.  After hitting her with those names, I told her flat out that those people made him unbelievable, and that his plans to raise taxes as we enter a recession were downright dangerous.  And after seeing Obama and Biden change the level of rich from $250k to $200k to $150k, I didn't trust that he wasn't going to tax more people which would damage a wounded economy even further.  Class warfare isn't the way to bring prosperity. 

Just so you know, telling her that I don't care about the color of his skin, but only about the effectiveness of his policies, the quality of his character and the level of his honesty makes me an ignorant racist. 

After hearing the good things that people have said about the Obama campaign workers and the way that they have handled themselves, I must say I was disappointed.  Of course, after seeing how Joe the Plumber was attacked and how the TV anchor in Orlando was attacked and the station cut off because Biden didn't like the questions, I'm not that shocked.

I mean, really... 

• I have to pay the full cost for repairs to my car.  Since I drive cars that aren't in warranty, the cost is born by me and me alone. 
• I have to pay for my own preventive maintenance... oil and filter changes, tires, alignments, transmission and cooling system flushes.
  
• I have to buy my own tires, windshield wipers and brakes.
• I have to schedule all of these procedures myself.

And that isn't all... 

• I use my car for work... the company benefits.  I drive that car to work, and if it isn't insured, I can't go to work.
• If the needed maintenance and repairs aren't made, my car is dangerous and could impact others... literally.
• If I don't replace consumables, like tires, then my car is much more dangerous to others.  

I pay my auto insurance every month, and yet it only covers me for accidents and unforseen consequences.  Why is that?  Why shouldn't our auto insurance cover EVERYTHING that happens to our cars?  After all, our medical insurance covers everything that might happen to our minds and bodies... 

And one more thing...

Why is it up to me to pay for all of it.  It is expensive.  I think that the company I work for should pay for it... or maybe even the government.  After all, I drive my car to get to work.  That means that they profit from my car.  And if I don't have the car, then work isn't happening.  Why don't employers pay for auto insurance...

Shouldn't affordable car insurance be a right?

The simplest definition for Justice is getting what one deserves.  As I ask people about how they define justice, they keep coming back to the same thing... getting what is due to them, or getting what they deserve. 

And yet...

I keep hearing about economic justice.  And every time I hear about economic justice, the basic premise is to redistribute wealth or income.  And that means taking money away from someone that earned it and giving it to someone that didn't... 

So, how?

So, how does one square these two positions?  If justice is getting what one deserves, why is economic justice getting what someone else worked for?

Friday is halloween.  And the little ghouls and goblins prnacing around with sacks and costumes won't be the only scary thing... 

Halloween is the WORST traffic day in Atlanta all year...

And this year it is a double down bonus.  Fridays are usually the worst drive home traffic of the week... and Halloween is on a Friday.  Expect and plan for terrible traffic.

Even getting out of work early doesn't really help... in fact, if you aren't going to be parading kids around for Halloween, staying at work a little late might be a good strategy.  The traffic comes early on Fridays AND Halloween.  Expect to see it get ugly by 4:00 Friday afternoon. 

Talk to the boss.  It would be a great day to telecommute... or take a personal day. 

Don't say you haven't been warned...

If your home has been listed, and it is getting ready to expire, I would like to make a few suggestions...

• Get a new agent... like me...
• Set up the new listing to begin the day after the current listing expires...
• Go on a nice vacation for a few days...
• Don't forward your home phone to your cell phone... and you might consider NOT sending it to voice mail...

Why you ask?

Because it is going to get ugly.  Seriously.  It is kind of funny, I talk with agents all over... not just Atlanta, but all over the US... and they often say the same thing.  "I'm not really looking for sellers, I am looking for buyers."  And it is an odd thing to hear since as a newly expired listing you will recieve...

• 93 phone calls... these will start at about 6:00am the day your house expires...
• 165 letters... ok, some will be postcards, others will be letters... and then...
• 3 packages... like FedEx, DHL or Courier.  These will be touting the senders super groovy abilities...
• 8 door knocks from agents... these may also start pretty early on the day of expiration...

There is a madness to the method...

The reason that you will be inundated is that it works.  It doesn't work a lot, but if they contact a couple hundred people, there will be a couple that might fly.  For these agents, this is their job.  It is referred to as prospecting.  You are a prospect...

I've been through the coaching.  I know the drill...  Make 35 calls a day, 5 days a week.  From that, expect to get 10 appointments and from that, 4 listings.

But here is the problem...

Instead of spending time putting together marketing packages for homes, they are only putting together marketing packages for themselves...  If they list enough properties, something will sell.  Your property is a possible sale, not a priority.

It doesn't have to be that way!

You won't likely get a phone call from me... and certainly not at 6:00am.  You might see a newsletter.  If you contact me, you certainly WILL get a package regarding listing information.  But, instead of dreaming up ways to market ME... I am dreaming up ways to market YOUR HOME.  I am building web sites that are just for and about your home.  I am looking for ways to better connect with the buyers that are in the market now.  I am looking at market data and trends to see what is working.  I am looking at the analytics of the marketing I have done so that I can better see what has worked.

It isn't about me.  I don't want to be famous.  I don't want 1000 listings.  I don't need to market for my ego.

It IS about making YOUR home sell.

I do have to spend a little bit of time promoting myself... I do need some listings.  But I try not to be annoying about it.  I have dealt with pushy agents.  The can do really well... but I think that an agent that concentrates on getting homes sold can do better than an agent that concentrates on getting themselves sold.

I look forward to hearing from you.

from LilburnDwellings.com

There are a few quotes from this intervirew that I think are really important...  In 2001, the local Public Radio Station in Chicago interviewed Obama and he talked about his thoughts on redistribution of wealth.  Honestly, it is kind of scary that Obama... as a Constitutional Law Professor has NO respect for the Constitution:

• "The Supreme Court never ventured into the issues of redistribution of wealth and sort of basic issues of political and economic justice in this society, and to that extent as radical as people try to characterize the Warren Court, it wasn't that radical," Obama said in the interview, a recording of which surfaced on the Internet over the weekend.  "It didn't break free from the essential constraints that were placed by the founding fathers in the Constitution, at least as it has been interpreted."

The Supreme Court... the body charged with the job of making sure that laws are aligned with the Constitution... didn't break free from the Constitution.  Obama has already stated that his selections for the Supreme Court would need to "balance Social Justice" with the law... not follow the law. 

• "And the Warren court interpreted it generally in the same way -- that the Constitution is a document of negative liberties, says what the states can't do to you, says what the federal government can't do to you, but it doesn't say what the federal government or state government must do on your behalf, and that hasn't shifted.

D'uh.  The Bill of Rights is specifically designed to protect the population by LIMITING the power of government.  You limit power by telling people what they aren't allowed to do.  You do NOT limit the power of the government by telling the people that the government is your Mommy. 

So, we have a guy that is about the be President on the United States... and as such, will be sworn to uphold and protect the Constitution of the United States.  And this guy doesn't respect it, and doesn't seem to be able to figure out that the very framework of this country is for the government to be limited in scope. 

And he is backed up by a guy, Joe Biden, that doesn't even know what his job is as defined by that same Constitution. 

And just to make sure that they can do maximum damage, they will have the support of both houses of Congress... 

I'd like to thank:

• the Republican Party for their amazing spending spree the last few years.  
• the Obama voting populace that thinks that socialism is ok...
  
• the Mainstream media for giving the socialist a pass and not holding his ticket to the same standards as the GOP ticket. 
  

For those that are liberal and think that Obama is a good idea... enjoy this time.  There is a VERY good chance that in two years the country will lurch to the right in a GIANT way... and you should assume that Obama will be a one term President unless the GOP completely implodes.  And it may take several generations for the country to recover from the damage done by the next administration. 

There are so many things going on in the world of finance right now.  I know that you are hearing about things like:

• Mark to Market
• Credit Market Freeze
• Derivatives
• Sub-Prime Mortgage Meltdown
• Mortgage Backed Securities (MBS)

And there are a hundred more... 

I can't explain each of these in depth, but they are some of the things that NEED to be understood in order to know how we got to this point where the banks aren't willing to loan money to each other even overnight.

The path that we took to get here, in part, goes back to an item called the Community Reinvestment Act.  Groups used it to force banks to make loans that were VERY shaky.  It has its beginings in the Carter Administration.  It really built steam in the Clinton years.  It kind of faded into the background in the early years of Bush... but the market was flush, so the problem was just a festering wound over unbroken skin until home values started to get challenged.

I have written a lot on my other blog about how the CRA and groups like ACORN played a large part in the financial problems we are currently facing... but I'm trying to not be political here (yes, I AM opinionated).

This is the part that you need to know.  This has been a long time coming.  And now, because there are so many bad loans, and banks don't know which other banks might have junk on their books, they don't trust each other.

What needs to happen in order to move forward is that trust in the financial system needs to be restored.  That is the goal of the bailout.

from LaneBailey.com

I wrote a post not long ago about about foreclosures, and how they aren't always the great deal people make them out to be.  That led to two things...

• People asking me how to get a good deal on a property if foreclosures are not the Grail...
• Agents that specialize in foreclosures complaining that foreclosures are always great for consumers...

Let me start with the second point.

It is faster.  No they aren't. In fact, they often are the worst deal.  The initial price might be more attractive, but that doesn't mean that the cost of ownership is lower, or the investment potential is greater.  Purchase price is only part of the equation.  There are costs of repairs, deferred maintenance and hidden damages to consider.

Of course, sometimes foreclosures CAN be great deals... but don't assume.  And ALWAYS get a property inspected by a GOOD inspector.  Not your cousin (unless he is an ASHI certified inspector) or Dad (also with a certification).

On the the first point...

It depends on your goal.

If you are looking for an investment property, it would begin with figuring out where you want to be.  Don't think of a ZIP code or a region, but a couple of neighborhoods.  Find out what sales have happened in the area.  Learn the houses.  Know what the price should be for different homes.  This is where having a Neighborhood Expert real estate agent can come into play. That is what we do...  Not anything-anywhere, but something-somewhere.  With this information, as property comes on the market you can recognize the ones that are potential deals.  And then, look further into those properties.  See what room there might be to manuever.  Find out how motivated the seller is.  Inspect the property.  And remember, you aren't the only investor in the world.  And while there are over 9000 properties listed for sale in Gwinnett County and almost 500 in Lilburn... but there aren't that many deals.  I see a LOT of properties that are selling in a few DAYS.  Those are the deals.

If you are looking for a property to live in, it is tougher.  You likely aren't going to find the perfect house in a situation where the sellers are ready to give the best deal... especially if you have fallen in love with it.  But, what IS likely is that you can find a closer to perfect home.  There are a lot of properties on the market.  And if one doesn't work, there is another.

How NOT to get a deal...

There are some strategies that generally don't yield results.  You can find an agent that will play the game with you, but you will likely end up frustrated and on the sidelines.

• Low-balling...  As a caveat, I just closed a property for a buyer that they picked up at $220k which had been listed at $300k.  If was honestly a great deal... but it was by NO means a $300k property.  But it was also somewhat unique, and sort of a lightning strike.  The seller was ready...  Of course, had the property been listed at $260k 17 months ago, it would have been sold.
• Wrap-Mortgages and other "TV Guru" schemes...  Sorry, but the vast majority of those are crap.  Sure, someone might be able to pull it off, but I just recently ran across an associate that was trying to fix a situation where a buyer wrapped a mortgage... poorly... and the seller stopped making their payments.  The result was that their deal turned into a giant loss and a pile of legal fees.
• Stretching...  Get something that you can afford.  Sure, this is a great time to upgrade, but make sure that you aren't over the ragged edge.
• Exotic mortgages...  Just say no.  Unless you are a VERY saavy investor, most of the exotic products can lead to exotic trouble.  They do have a place, but that might not be in YOUR portfolio.

I hope that helps.

from LaneBailey.com

I was talking with one of my mortgage brokers today...  We are planning on doing a few podcasts, and he is a pretty cool guy, so we like to jabber every once in a while anyway.  But there were a couple of things that Ken said to me as I was wandering around the store looking for birthday presents for a 4 year old and a 2 year old.

Lane, I have money here and I can't find anyone to take it...

I'm watching the news, and I'm reading about the real estate markets and the "credit crisis"... and from that I get the impression that there simply isn't any money available for buyers... and that isn't the case. There are sources of money... at good rates... for qualified buyers. If you are looking to buy a house, it isn't impossible, despite what you might hear on the news.

Danger = Opportunity

There is a unique opportunity right now.  Listening to Clark Howard today, I heard it.  Right now people are going to get "deals of a lifetime."  Not every property out there... but NOW is when those super deals will be had.

When everyone is selling, buy.  Even Warren Buffett is saying it.  When the market is in the most turmoil, the best deals will be had.  I'm not going to say that the market is at the bottom... It may be, it may not be. But the point is that when we KNOW that the market is on the way up, everyone knows it is on the way up.  Right now, the thing to do is tolook at deals and see if they work.

Example...

From one of my sources, this is not in the MLS...

_______ has an office condo in Roswell that is tenant occupied on a 5 year escalating lease with a tenant who has paid on time for about 4 or 5 years. She is in the middle of her second year in this 5 year lease. Cap rate as it stands is 8.5% with a net positive cash flow of $4800 before income taxes. $113k cash or $40k cash and assume the existing LLC and 7.5% 20 year loan. Current rent is $1250 and goes up every year. He does not want to list it. He doesn't want to entertain any offers except "I'll take it". Actual value at 8.5 cap is around $137k.

Cash flow positive property...  Is the market at the bottom?  I don't know, but this property cash flows NOW!  The owner needs cash for another deal...

Bottom line...

There are some great deals on the market right now.  Maybe they will go down another 5%... or maybe you are seeing the bottom of the market right now.  In the spring, we might be looking back as the 4th Quarter as THE time to buy... or maybe the 1st Quarter of 2009.  But this deal might not be available then.  And there are a lot of other properties that may not be available.  And there might be a lot more people that have figured out that there are deals to be had.

from LaneBailey.com