My morning ritual is to get up, put on shoes, wade through the flood created by my neighbor’s over-watering of her lawn and pick up my nicely bagged copy of the New York Times.
That’s service for you: They even bag it on sunny days. I begged for daily bags after my neighbor’s daily floods soaked a week’s worth of papers, and the NYTimes said sure, happy to do that.
Today’s paper had a couple of interesting stories: Homes are no longer a value-producing goose, but Cable TV still is.
First, homes: As this story makes clear, the American Dream to buy a home, have it triple in value in five years and then sell so you can buy another home that will triple in value, and so on, seems to be dead.
Frankly, I am disappointed that this is not the lead story on the paper. It markes the end of a too-long era of greed and sloth, fed by unearned money, and this means that we will have to return to the America of old where you actually earned your money.
The myth that homes never lose value fed the last boom/bubble. It generated trillions of dollars in phony “wealth” that fed an equally mythical economy. To go back to an era when homes are merely worth what you pay for them will be good for everyone, even if it does mean that the economy will take longer to “recover,” and I say that that way because, get real, recovery to what the nation was in 2006 is never going to happen, never can happen and never should happen. If would be like telling someone in the throes of heroin withdrawl to “recover” by getting high again.
Do this mean my kids won’t be able to sell my house after I die and retire on a couple of million? ‘Fraid so.
It will mean a huge mind-shift for Americans to start thinking of homes as places to live, again, not investments. I know people who have no kids and bought huge homes precisely because they were investments, guaranteed to pay off, and now they’re stuck.
I’m having a hard time feeling really sorry for them.
And, think of it: A home is still something that is very likely worth what you paid for it years later. Homes don’t depreciate. If you keep them up, they hold their value and inflation will automatically be adjusted for as the price rises to match what buyers can pay, based on the laws of supply and demand.
But that’s still pretty amazing.
Name me one other commodity besides precious metal that can do that. Considering that you can buy a $100,000 home today and still have it worth $100,000 in five years, that’s pretty amazing. A $50,000 car, by comparison, will only be worth $10,000 in the same amoung of time.
Speaking of thowing money away: This story also in today’s Times (click!) talks about how people have tried, really tried, to get by without cable TV and they just can’t do it.
The example they use is someone who subscribes to some $130 a month service so his family can watch a couple of shows, which is extreme. My friend Larry has basic cable for less than $20 a month, but my question remains the same: How in God’s name can anyone, in this day and age, justify paying that much to watch TV?
It would be fun to know if these are the same people complaining that their homes aren’t gaining value, and you never know. One amazing aspect of the American mind is that it seems incapable of irony. Here people worry that their house isn’t a goose giving them golden eggs to live on for free, but they’re more than willing to drop $100 a month so they can be entertained.
No, not just willing. The guy in this story says he has to, he’s forced, he sees no alternative. Sounds a bit like addiction, you ask me.
He also complains that he’s “forced” to buy a bundle of shows he doesn’t want to watch the few he does, but if he and his ilk had any dicipline they’d boycott the cable company until it sold them what they’re willing to buy.
Supply and demand works both ways. Notice how the NYTimes, anxious to keep a customer, is happy to sell me just a sunday paper, or just a weekend paper?
And how they’re happy, if not overjoyed, to bag my paper even on sunny days, anything to keep me happy?
The cable company doesn’t have to be nice to its customers. Like any good drug dealer, it knows its customers are hooked.
Yeah yeah, I know: It’s the customer’s money. And it is. I just find it amazing, in this day and age, when people scream about a $10 increase in annual taxes, that they’ll pay whatever cable TV asks with only the mildest of wimpers.