Tuesday, May 29, 2007

Charly the Unicorn

You have to watch it all the way to the end or you're wasting your time. But if you were actually using your time wisely you wouldn't be reading my blog would you?

http://www.youtube.com/watch?v=mdKPLDYKdWU

Friday, May 18, 2007

Porn Bust

A little way down the post list here you can see where I plugged my cousin's porn site. My cousin was helping his friend Andy get it going on the web. Well someone discovered what Andy was doing in his free time and put it in the paper. Unfortunately for Andy he's a teacher at a Church of England school, this won't do wonders for his teaching career:

http://www.northamptontoday.co.uk/news?articleid=2840227

Thursday, May 10, 2007

/rant_on

I think I'm going to punch the next person who tells me they "made money" owning their home. You didn't make jack shit if your personal residence went up in value. Its true that house values tend to go up over time but most all of the increase is inflationary, not real value. One huge problem is that you're measuring the value of your home in U.S. Dollars which are always going DOWN in value. If you measured your home's value in ounces of gold you'd find the value has been flat for years.

Remember when a three bedroom rambler in Roseville was $120,000, gold was $270, gas was $1 per gallon, smokes were $1.95 and a 20oz bottle of soda was $.93. It was about eight years ago. Here's the update for those of you who haven't left your parent's basement for a while: The house is $250,000, gold is $680, gas is over $3, smokes are over $4 and soda is almost $1.50. It's the inflation stupid.

If one of these savvy economist homeowners sells their home, a comparable home will cost the same (minus the parasidic real estate agent costs), so really they're losing. The only real advantage of buying your own home, financially speaking, is that your payment stays the same and rents (the alternative) tend to only go up. (Legal Disclaimer: This assumes your mortgage is fixed and not adjustable and excludes tax and insurance payments.)

Props to Crispy for pointing this out to me, something I never thought of that really makes people shut up: How long would you have to own your home for it to appreciate enough so you could sell it and buy two neighboring homes exactly like it with the sale proceeds? It doesn't take long to realize that it will never happen. Your house went up because the dollar went down. The real value increase is small or nothing at all.

If your house is your biggest asset then your financial problems are larger than you have ever imagined. Something is always better than nothing but your abode doesn't really look like an ATM, please don't try to turn it into one. (Although if you'd like to ATM your house I can help.)

I try to explain this stuff to people in the real estate business but very few get it. Most of these people are products of the public school system and haven't heard of M3 anyway. Those who do get it are not my converts, they already know what's up. (I've yet to make a convert.) They talk about home appreciation when they should be talking about dollar devaluation. I think most people are so conditioned to prices rising all the time that they view it as normal with no way to stop it. Rising prices are just the way it is and they don't understand why. The Fed is why!

BTW: Why are people buying bonds at less than 4.9% yield when inflation is about 5.5%? Who are these people? Whoever they are they're fuckin' themselves with a Big Inflation Dick (BID). I love you Mogambo!

/rant_off