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[Gene GeRue <genegerue AT ruralize.com>]

On Sep 7, 2008, at 10:58 AM, Clansgian AT wmconnect.com wrote:

> > And anyone who thinks that politicians can fix it are drinking or
> smoking really good stuff.
>
> The US saying that tax revenue can cover the losses incurred by Fan/ 
> Fred is
> our mouth making promises our colletive a**es can't keep.  If your
> conversations have been wide ranging, over the past half decade you  
> will have heard many
> times that the Congress wouldn't allow entitlements to go south  
> because all the
> retiring geezers would not vote for them,

Hear ye, hear ye, this is the most sacred sacrament of the nation: the  
vote. To a politician, the most important American issue is election  
and reelection. Votes are as food.

 When real estate
> "values" began to rise unrealistically in the early part of this  
> decade fueled
> by low interest rates and shady loans, most sober economists  
> predicted the
> housing bubble and the current (and continuing) aftermath.  Others,  
> under the
> guise of being economists, such as the economic spokespersons for  
> the NAR, kept up
> a tatoo of "bottom is just around the corner", "they ain't makin'  
> any more
> land!", "it's a GREAT time to buy."

First, let's use the facts. Real estate "values" is not useful. Real  
estate sales prices are much more accurate and useful. I taught all my  
real estate appraisal students that the "value" of any piece of  
property is what a buyer and seller agreed upon, neither being under  
any undue stress.

It is tempting to look at those and say, "Ah, well you see, the  
economists
> didn't agree so nobody really knows, do they?"  It wasn't that  
> economists didn't
> agree, it was cheerleaders and mouthpieces didn't agree with the  
> economists
> and there was an effort to lump them together as all being experts  
> alike.

Quite so. It is essential for all of us to recognize the chasm between  
purveyors of fact (few) and cheerleaders (many). Today, we have  
another element to the equation of what equals truth: bloggers.  
Bloggers are like all of us, they want to be perceived as important.  
So they offer their views. Some are competent in their understanding  
of what they react to and some are simply provocative and  
entertaining. One of the challenges we face today is becoming  
sufficiently discerning to separate useful viewpoints from the merely  
entertaining.
> For example, the infamous David Lereah . . . .

Always beware of lobbyists and industry spokespersons. The caveat is  
that such people often have access to more information than the  
bloggers.

Apropos, I am skeptical of what AARP, my personal lobbyist, puts out.

> wrote (retitled and republished) . . . .

Writers and publishers are another group for whom skepticism is  
appropriate. They may well have an agenda that seduces you, but their  
bottom line is their bottom line: the paycheck.

> Having a garden is ALWAYS a good idea.

I can think of instances where this would not be true, for instance,  
where the minimally available space might better serve for sleeping  
room or for making a living sufficient to buy clothing, etc.
> Having debt is ALWAYS a bad idea.

I disagree sharply with this notion. Used prudently, debt to buy real  
property or to pay for a good education is very worthwhile.
> So the advice has been from the clay tables of ancient Sumer to  
> Shakespeare
> ('neither borrower nor lender be') to the present and it has always  
> been the
> best advice.  The problem came in the 'irrational exuberance' of the  
> early part
> of this decade when some became convinced that having debt was a  
> GOOD idea.
> After all, if you owned a $50K house that was rising in value 20% a  
> year, you
> were only "making" $10K.  But if you borrowed $200K for a bigger  
> house, you
> would be "making" $40K a year.  A no brainer, eh?

During most economic times during which I have lived, including three  
decades-plus in and around real estate, yes, a no-brainer. I could  
provide a long list of useful things that I have because I bought real  
estate, including this wonderful one hundred and thirty acres of woods  
where my heart is, so which I call Heartwood.