Reaching......................

 

    

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Been in the..........................

................real estate brokerage business for a long time.  I'm not sure they've thought this through:

The 6% commission, a standard in home purchase transactions, is no more. . . .

Although it’s unclear what the future of the housing market will look like, Miller said he expected homebuying to pick up somewhat as costs fall dramatically for homebuyers.

Back story here.

Most pundits seemed to think that low interest rates helped the buyers.  Strikes us that low interest rates actually helped the sellers.   

Most buyers around here seem to think mostly in terms of their monthly mortgage payment.  A monthly payment of $2,000 will amortize a $360,000 mortgage at 3% interest over twenty years.   At 6% interest, that payment will only support a mortgage $280,000.

In a hot and competitive real estate market, which much of the country has experienced lately (mostly because of a shortage of supply of housing), who do you think reaps the reward of the extra $80,000 available mortgage financing that 3% interest provided?  Why do you think housing prices got so high so quickly?  You are kidding yourself if you don't think that part of the housing "affordability" problem was caused by ten years of 3% mortgage money.  When it comes to real estate, low interest rates are inflationary, and that favors sellers.

A similar thing will likely happen with the real estate commission issue.  If commissions fall, in a hot and competitive market, the buyer will not be seeing the benefit.  It will likely go to the seller.  All other things being equal, the buyer working with a broker who will work for a reduced fee, can now afford to offer more.  If the supply problem ever gets fixed and a "buyers' market" emerges, then it might be different.  In the meanwhile, two people can't save the same reduction in fees. (This assumes there will actually be a reduction in fees).  It will benefit either the buyer or the seller.  In a "sellers market," bet on the seller.

Time will tell, but my bet is that pundits thinking changing the long-established commission structure will help buyers, in what is still a "sellers' market," are fooling themselves - and the public.

Then nice people at .................................

 ........................Barnes & Noble assure me my copy will be delivered Friday!

Yep................................

............... Growing up, this was the best form of self-help.  Miss those days.

. . . alert and advantageous.................

 “That businesspeople buy low and sell high in a particularly alert and advantageous way does not make them bad unless all trading is bad, unless when you yourself shop prudently you are bad, unless any tall poppy needs to be cut down, unless we wish to run our ethical lives on the sin of envy.”

-Deirdre N. McCloskey

Just kidding.....................

He cracks me up....................

Amazon's offer to purchase Whole Foods has been in the news:

When you have more money...............

............than God, you can do this sort of thing.   Glad to see it happen.

Consumer greed......................

.................................................Mark J. Perry wants to spoil the fun:

Here’s a dirty little secret about capitalism: consumers, not corporations, run the show.  If you find something about the marketplace objectionable, it would be more appropriate to blame those who actually call the shots: the ruthless, cutthroat, and disloyal American consumers.

Hard to disagree with this..............

....................(although I'm a bit surprised they haven't offered help re-cycling all the damn boxes around here):

Amazon’s laser-like focus on creating value for consumers and keeping them satisfied with low prices, huge selection, speedy delivery and great customer service goes a long way towards explaining its phenomenal success as a retailer, which gets reflected in the meteoric rise in its stock price and market capitalization.

-Mark J. Perry, as excerpted from here

Too expensive.........................................?

     Having a brand that stands for quality at an acceptable price is a big deal here, because this country is cheap, cheap the way many Americans were if they grew up in the Great Depression.  Last fall, I went by my local Cybermart to get a Mii4, then the hottest Chinese phone since the Mi3.  I'd gone there straight from a meeting so I even looked like a businessman instead of a nerd, and I rolled up to a second-floor booth selling Xiaomis and got the attention of the lady behind the counter.  I am a bald white guy.  I speak pidgin Mandarin with a flat Midwestern accent, and I was in a suit - the only way I'd have looked like an easier mark is if 100 yuan notes were spilling out of my pockets like in cartoons.  I announced that I wanted to buy the priciest phone any Chinese company has ever produced.  The lady behind the counter looked at me and said, in English, "You don't buy that phone.  Too expensive."  China is cheap like that.  Even people paid to take your money are offended if they think something costs too much.  Tell me the next time that happens to you at Best Buy.

-Clay Shirky,  Little Rice:  Smartphones, Xiaomi, and the Chinese Dream

Truth.................................

more memes on books and reading here.

Do they know something we don't know........

......................Apparently our foreign friends from China , Russia, etc. are selling U. S. Treasuries.  Maybe they just need the cash.  Back story here.  It is interesting to read who is buying.  It is also interesting to note that the author doesn't think this will cause interest rates to go up.  Hmmm.   One would assume that since formerly voracious buyers of our debt are now selling the notes they own, they probably will not be buying Treasuries soon.  Are not new notes are also coming on the market as we finance our debt?  Let's see..............more Treasuries available and fewer buyers.  I don't claim to know much, but won't yields have to increase to entice more buyers?  Just wondering.

Here's a novel approach..............

"Don’t buy what someone wants to sell you.  Instead, research what you need, and buy that."
-David Merkel, as excerpted from here

Unfortunately..............................................

The 1870's were a much simpler time..............

Here's another tale I missed while securing my history degree:

Trist, a hard bargainer, refused to pay the contingency fee he had agreed. The case went to the Supreme Court, which dismissed Child’s claim. A contract to lobby government, it said, was contrary to public policy and hence, like an agreement to sell sex, unenforceable in the courts. Paid lobbying, said Mr Justice Swayne, was “pernicious in its character”. But this was only the beginning of his denunciation. “If any of the great corporations of the country were to hire adventurers to procure the passage of a general law with a view to the promotion of their private interests,” he thundered, right-minded men “would instinctively denounce the employer and employed as steeped in corruption and the employment as infamous”.

The above passage is courtesy of John Kay, who notes the difference between then and now.

For the curious, more on Trist v Child may be found here.

Me too................................................

courtesy of Mme Scherzo

A basic truth......................................

May I get an Amen.......................................?

"...purchasing print books in a brick-and-mortar building is something of a lost art, like taking snuff or drinking brandy after dinner. Which is not to say that it's not worth doing. Quite the opposite. Buying books in a bookstore is one of life's great, quiet pleasures."

Jeff Kopito, a great lover of small, independent book stores, points to the article from whence this quote was taken.

Like my first car for instance...........................

Kind of an ironic tweet coming from people who have made vast fortunes packaging and selling debt.

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