Oy! Idiots!! --New Home Sales in Surprise Drop

I'm going to try and make this brief. CNN reports that there's a surprise drop in new home sales.

I don't see why this is so surprising. Some good data in the article, but it's overall misleading. I'm not blaming the reporter this time--not really.

So new home sales dropped 3.6%. They've been rising for the past five months. But here's the kicker. Nothing has changed. The article even acknowledges that the drop off is likely due to the expiry of the New Home Buyer Tax Credit. A tax credit is a nifty way to stimulate the economy, without making overt signals the free-market flag wavers.

But think of the big picture. Employment continues to worsen--the dawn may be soon, but it's still pretty damn dark. The last estimate I read, in yesterday's Times Op-Ed, suggests the rate will exceed 10% by next year. Where do they think all of that home-buying power is coming from?

Allow me to apply a little amature pyschology, without the fancy words. Late in 2008 the market craters, the banks are closing, and you've started keeping a fat wad of cash under your pillow. January, new president, new times ahead, you start coming out of your fetal position, and start looking around. You know what people say about investing, buy low sell high. You were smart, you were saving your money, you probably would have bought a house in 2007 if you'd had the money saved. Now it's 2009, you have the money, prices are down, and Obama springs a fancy tax credit on you. Great. You buy.

But demand isn't just a current measure-it's a stream. And most of the demand of the last 5 months were from people who were ready to buy in 2008 and just put it off until things settled. So where is the new demand going to come from? Middle class wages continue to stagnate, and more jobs are still being lost than created. What's the big difference? Credit has totally evaporated, and the fake credit of a housing credit (which was a very good idea at the time) is really a go along to get along measure.

Obama had a really good opportunity to change things. But I think his team really wants things to just go back to the way they were--minus the Bush nastiness, of course. Look who his financial team is--all heads of the old order.

But things weren't cool. The kids were not all right. I don't know what the answer is, but I think I have a pretty good idea. The infrastructure of this country is rotten. Bridges over a hundred years old, crumbling highways, terrible rail and freight systems. Subways in metropolitan areas, like New York, falling apart, and totally inadequate to deal with demand.

People talk about Zeitgeist too much, but I have to say it. The Zeitgeist of this country has been in the shitter for 9 years now. The powers that be, the politicians, the media, the CEOs, they don't give us enough credit. We know that the rich are taking their money and leaving the party, we've been watching it for close to a decade. We don't blame them, but then they're puzzled when they don't see economic growth? I've yet to work through a period of economic growth. The Bush Boom was a boom only for the top 1%. That hasn't changed. And it's depressing as hell.

Banker Dicks and their Banker Chicks

As a bartender in NYC, there was no character I loathed more than the investment banker. They'd swagger in, decked out in a fancy suit, and armed with a devil-may-care, sneer-to-kill. To be fair, they didn't come into my bar all that often, it was too close to Columbia University, and too cheap to piss money the way they wanted to. So my exposure was limited...but those few experiences I had were always terrible, and I never understood how any woman could stand them. They'd roll in, approach two or three women talking boysterously after work and casually start insulting them. Everytime. Oh, you're a teacher? That's good, but what's the point? Oh you work for a magazine? How would you like to write something on someone who really matters? The megalomania was stunning. What was even more stunning was the fact that more often than not, their "charms" wore down the ladies defenses, and brought them home. No offense ladies, I just saw it happen fairly often. Invariably she'd be really turned off by his coarse, insulting mannerisms, but the "shock and awe" style of dating challenges a woman to defend herself. On a basic level, I used to do it too. But I would challenge their concepts of rationality, and perception, not demean their chosen professions or values. I hear you snort with disdain, so be it. I'll admit it up front, I couldn't help it, I was poor, bookish, and had little or no prospects, I was jealous.

Point is, now there's a website for the detritus, the human collateral that the ibankers left behind in their hasty exodus. The Times did a culture piece on "Dating a Banker Anonymous" so check out the ladies' website. Full of the types of complaints you might expect. He hasn't taken me out in months! But also genuine confessions from real women are are, really worried. I must confess, two years ago, I was all in favor of wealth distribution. Maybe it's just my way, maybe as soon as something becomes acceptable I abandon it, but my ardor has cooled significantly on the topic. For one thing, in my new life, I know a lot more of them. My basic opinion hasn't changed too much--there are real gems amongst them, but the cavalier attitude they took against anything not finance always bothered me.

Again, I feel sort of shorted. After eight years of watching the gluttonous orgy of buying and discarding, wining and dining, drinking and fucking (ok I had my fair share of the last) I finally decided to sell out and join the party. And the party ends. All I really wanted was to clear my student loans. Well so be it. My plan had been to regulate them anyway.

One last disjoined thought...this is part of what I've written about before...the city is changing. You can almost feel it. I walked alone down wall street last night at 9:30. (I went to the bank honey, that's all) The area is always quiet that late at night. But I saw all the new condos that have sprung up in the last year, and thought dismally, will they ever be filled? It's an unfortunate time, but it's also exciting. It's not everyday year you get to watch the entire zeitgeist of a city change so vividly.