How does your local economy feel?

[StillHope]

quote:

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Originally posted by JWFITZ


For those who MUST move, because their retirement is contingent on getting the equity out of the house, few options are available. Better get out sooner than later.

A lesson I remember from the years in my youth of hunting chuckar in Hell's Canyon and the Idaho deserts. The first bird that flies from cover startles you and gets away. The next two don't.

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Exactly!

[pslamont]

We came from California around 5 years ago. Our little tract house, which we bought in around 1984 for $95,000 sold in 2003 for $540,000. Real Estate went STUPID in San Diego for a year or two and we bailed out at the right time. That same house today would sell for around $375,000 and that is too high! People let themselves be caught up in the ridiculous false economy of paper money... over inflated values with no real asset value to back it up. House prices went up because people could borrow more and more money to buy so just offered more.

Here in Puna we experienced this same phenomenon but to a lesser degree. All those California types who sold like I did came over here with $$ and were willing to pay more than the assessed value because it seemed like such a bargain... and it was a bargain compared with what we left. The ones hurting the worst from what I see are those who bought for investment, built intending to rent out the new house for 5 or 10 years until they retired. They discovered a flooded market and not enough renters. Flooded market = lower prices.... and when they panicked and tried to sell these last two years prices plummeted.

Those of us who actually live here will be fine. We will have to do a little belt tightening, maybe some work when we expected to live off investments but we will be fine.

I know I was darned lucky to get out of California when I did and get to this lovely land of opportunity. I see opportunity around every corner for those who want to make effort.

In the bigger natioanl picure, our son worked for Lehman Bros. as a Vice President for Corporate Philanthropy (yeah, like his mom, he loves giving it away). He saw this coming and got his resume out there, began networking... he got a decent severance package BUT has no faith it will be honored. He is looking at an offer from the University of Chicago plus two in New York. One is with AMFAR (American Foundation for Aids Research - hey have a 28 million dollar budget that is solid). He will land on his feet but there are many that will fall flat from the banking crisis.

I have no degree in economics but my thoughts are that this is a VERY BAD crash for our economy. No Way the government should bail out the banks. It will be a short crisis if they don't. People will get hurt. That is all going to happen anyway, but the government doesn't bail out the mom and pop that goes belly up because the kids were raiding the till for drug money. They suffer the consequences and start over. Lehman executives were pulling down 4 million dollar salaries (No, not my son!!) and the top 20 execs walk away financially clear. It is a sin. They grabbed their salaries by clearing out all corporate accounts the weekend before they declared bankruptcy. I could go on.... but I still have no love for insurance companies, investment banking or the like. I believe in the little guy.

That is why I believe Puna will survive better than most. Here we will have the intellectual advantage of many fairly educated folk with a good work ethic and the rural advantage of being able to PRODUCE at different levels. We will trade and barter and help one another and will come through.

Oh how I do love Puna!

[DickWilson]

I think a bailout is inevitable. But I sure would like to see some prosecutions and as I wrote our senator, There damn sure better not be any tax money going for any g@@dam* golden parachute. If you are so incompetent your company has to be bailed out, as far as I'm concerned if you avoid jail, you should be happy. The mortgage mess is just that, there is now way some of the people with 750K mortgages can or should be helped, if you don't know you cant afford a mortgage, you shouldn't be in it and I don't want my tax dollar bailing your sorry a$$ out.

dick wilson

[David D]

The current economics has certainly pushed our plans back a few years - 5 years minimum. We were going to make our move this year. Ain't gonna happen! At least I've got a good, steady job (23 years and still counting) and we never jumped into refinancing game. We're better off than a lot of other people out there. All things pass in time. There will be good times again.

[pslamont]

I agree with that totally Dick. I have a friend who has a million doller mortgage on a home that has been devalued to under $600,000. She is whining... I told her to sell the mercedes, the diamonds and live get a new appropriate loan. She is appalled with me. That is okay because I am appalled with her choices. She makes good money bu had no business maxing her mortgage on a house at overinflated value and then whining about it.

We all live well when the good times roll, but when it is time to pay the piper with responsibility it measures our true character whether an individual, a corporate entity or a nation. Isn't that what we are busy teaching our children???

[Lin W]

I moved to North San Diego County (Ramona) in 1997, at the tail end of the real estate slump, got a new “spec” house that had been on the market for over a year with no offers at a very good price. In 2004 I decided I’d had enough of SoCal so I put that house on the market. Real estate was crazy -- I had six offers within three hours of listing it. I sold it for four times what I paid for it and moved to Puna for two reasons, climate and affordable property. I hit here just before housing prices started up so paid well under $200K for my little house in HPP. My timing in both cases was perfect, albeit accidental. I work via the internet, doing medical editing for a huge company based in Manila so my job moved with me, so far seems very secure and, I have health insurance. I don’t make a lot of money but it’s enough to live -- here. I don’t think I could make it on the mainland (or on any of the other island for that matter) on my salary. But here I’m debt free, have no mortgage, no water or sewer bills, no summer cooling or winter heating, and, as a resident senior citizen, my property taxes are less than $100 a year. Since I work at home and don’t commute, gas prices aren’t a huge problem. I am able to keep a small garden going year round and I’ve been considering getting some chickens and maybe a milch goat. I’m at the point in my life where accumulating a lot of “stuff” no longer interests me. What was left over after purchasing this property and making the big move to Puna, I put in long-term CDs. I also have a small IRA and a tiny bit of stock I inherited. Over the past months I’ve watched them all tank but then I never figured I’d have enough to retire anyway so I‘m just leaving everything sit and hoping that it rebounds somewhat with time. My goal was to be able to drop back to part time work when I hit 66 and so far those plans haven’t changed. I have friends in Escondido (San Diego County) whose little condo was appraised at $250K+ a few years back, but recently when they wanted to refinance it was valued at only $85K -- they’re upside down and struggling. I’m so glad I got in and out when I did and managed to wind up here. I’m horribly ignorant about all things economic but I fear that the global situation is going to get far worse before it gets better. I wish I’d paid better attention when my parents talked about living through the Great Depression.

use it up, wear it out, make it do, do without

[Kapohocat]

quote:

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Originally posted by james weatherford

Costs. Jobs. Debts. ...

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I will give an example - my pops all the way out in Honomu and on DIAL UP ... is making so far this year way way more than 10%on his investments as of 9/18. Yes he is retired and spends a few hours moving things around and he is smart too, and well I guess lucky too. (Luck = opportunity meeting preparation). Little debt at all. All their property is making money because they are old mortgages - some even paid off this year. The only worry he really has is costs - but again being retired he plans his two trips to town a week very well. Still coupon shops. And drives a car that is paid off with very low miles on it. Keeps electric low. They rarely use the clothes dryer. Flys standby on his son's passes. Full boat med insurance paid for by former employer as part of retirement pkg.

His outlook is based on being a depression era baby. So this recession is a been there done that kinda thing.

He told me if he was thirty years old with 3 kids today instead of in 1964 he would be scared to death.

[mella l]

Unlike the 30's depression bailout of apx $39 Billion, this is the language** attached to an apx $700 Billion current bailout pushed to hurry up and get off the dime, it is ironically called Section 8 (for obvious reasons) except this section 8 is for financial corporations.

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

What possible reason could there be for this type of wording?
No judiciary oversight? Wake up!


mella l

"Resolve to be tender with the young, compassionate with the aged, sympathetic with the striving, and tolerant with the weak and wrong....because sometime in your life you will have been all of these."

[hpp4me]

Things feel very slow here in Northern California. A lot of local businesses are gone.

I've never tried to time the market, but a couple of weeks ago I put about one-fourth of my retirement into commodity producers and precious metals. I was not hurt as a result. Just luck, of course. I don't believe anyone can time the market consistently.

Of course, our lot in HPP seems to be losing value every month, but it will bounce back.

August Data:
http://www.localhawaiirealestate.com/Haw...20LAND.pdf

[Guest]

I've been watching property prices drop dramatically here in Puna just over the last 6 months alone.

A property valued at $300,000 six months ago is now at $210,00.

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