Another money and presidential politics blog…

Put your hand in your back pocket. Take out $600 and then put the $600 in your front pocket. Don’t you feel better! This will stimulate the economy and create goodwill for the Republican party. Good job, W, that makes sense.

There’s a problem. The action that will stimulate the economy is increased production (growth) not a government handout. This is not new money it is the redistribution of money already collected as taxes or an obligation of the government to collect new taxes and give the money to someone else. With 100% consistency nobody has called Mr. Bush a genius. Who gets the bonus is based entirely on income. Mr. Bush is creating entitlement classes based upon income and not including the higher income class which is an interesting thing for a Republican to do.

This logic (the decision who gets what because they “need” it AND it will stimulate the economy) is what Obama wants to use to raise the capital gains tax rate to 50% – to make it “fair”. If you have any plans for investing money and making a decent return keep in mind Obama will take the first 50 cents of every dollar profit on top of basis when you sell (generally) because the teacher and fireman (his example) will not have the same opportunity to make money (capital gains) because they don’t earn $100,000.

OK, let’s take his word for it and look at it.

Since Obama is talking about taxes here you have to consider the reality that many households with two incomes file one tax return. So, Obama’s claim that the income is less than $100,000 is not true – many municipalities pay their captains serving in the fire department more than $50,000 per year. Add that income to a teacher spouse with a little tenure and you go over $100,000 quickly. Then tack on the state and federal entitlements, bonuses and retirement benefits paid to teachers and firemen by other tax payers for doing a job they chose but not matched in the private sector and those teachers and firemen have a champion to vote for (Don’t get me started on firemen working a “full-time” week in 3 days and then running full-time second businesses which are, in effect, subsidized by tax payers to compete against other businesses). I know two firemen in Oklahoma City who own rental property, make more than $100,000 and do not like Obama’s plan.

If tax money is going to be the deciding issue I’ll vote for John.

What am I doing with $600? Nothing. I’m paying for the entitled ones who will stimulate the economy by filling up their gas tanks, pay down their cell phone bills and buy a PSP or Wi. Good job, W!

Mars out.

Still Life – Traveling with Bananas No. 25 “Levi Jeans Jacket – One Owner”…

Road Noise

Your past is never far away

I found an FM frequency (91.1) for my XM Inno auto kit good for the entire trip from the bayou of southern Louisiana to Central Oklahoma. A minor miracle considering within the Dallas metropolitan area every Baptist or Assembly of God Church with more than 50 members has an FM station broadcasting in one language or another 24 hours a day. (A Baptist friend from Texas joked I did not find an open frequency – it was simply down for maintenance. We’ll see next weekend. M)

I laugh when I see the $350,000 motor home with two bicycles strapped to the back bumper. Is there no room inside or below?

Here’s a car ad I’d like to see: The announcer on crack yells at the camera “Our cars are not loaded – they are OVER-loaded!!”

If ranchers are selling cows because they can’t afford the corn to feed them at the feed lot because the price of corn has risen due to the ethanol craze which doesn’t create more energy than it takes to grow the corn, process and ship the ethanol then maybe more cows will be range fed instead which increases the number of cows with lower body fat content because they won’t be standing around in feed lots eating corn on hills made of dung. So, maybe we’ll get leaner beef…maybe. I’m not waiting I’ll stick with bison.

I have a Danish video of a guy riding a motorcycle 200 KMH through traffic in a country where the average driver respects most traffic laws. I dare him to come over here and make the same ride on 635 around Dallas. He wouldn’t make it 5 miles – someone would cut him off and run his ass over.

Mars out.

Who’s next?…

(A slightly different view of the same info – debt, credit, declining asset values, default, rental property. M)

• The average savings rate (US) is less than 3%;
• the average household income for two-income family is $60,300 per year;
• so, the average saving account is less than $1,800.
• The average household has more than $9,000 in credit card (unsecured) debt.

Here’s another rabbit trail:

1. home equity tapped with an adjustable rate second mortgage three years ago to pay down credit cards, pay for home improvements, take a vacation at the spa and buy some more stuff;
2. bought new car on seven year note;
3. home value declines to point where primary and second mortgage balances exceed the appraised value of the collateral (the house) making the borrower technically in default;
4. first mortgage holder requires borrower to pay down principal to meet collateral to loan ratio;
5. second mortgage interest rate resets resulting in a couple of hundred a month more in payments;
6. borrower maxed out credit cards again…

The rental market should be doing just fine for the next ten years – single and multi-family properties.

Mars out.

Rental property…

I have been thinking about real estate and am preparing to get back into the landlord business. Here are some thoughts. I will compile them as checklists for the front page of the blog as they grow.

Consider:

• Everyone has to live somewhere;
• there is a tenant for every rung on the income/housing ladder;
• there is an instant, a moment, a day where your rent is one day late – this is the time to act;
• become very familiar with the Landlord and Tenant Statutes of your state and municipality. Simply follow the rules;
• a lease is no better than a handshake when one of the parties (including you) does not follow what is written and worse than no lease if you do not act as agreed (when you go to court to try to enforce a lease you have defaulted on by not doing what you said you would do the court will find for the tenant every time in Oklahoma. Your lease is worthless.);
• determine the cost to you in time, lost rent, lost income, court costs, parking, fees, advertising, etc for both evictions and lease turn-over;
• consider Single Occupancy Units if your statutes allow for this category;
• if you really want a bad tenant to move out pay them – cash for keys, it works. How much? How quickly do you want them to move out? Do NOT give them any money until they are loaded up and ready to pull away from the curb;
• if you were a renter/tenant what would you like your landlord to do without asking;
• good customer service will head off many problems before they occur;
• make improvements and repairs as bullet-proof and easy-to-do-next-time as possible. Access panels, high quality or commercial fixtures, metal, concrete, high-solids paint, etc.

Mars’ top secret investment property targets beginning 2008 (be aware Oklahoma conditions may not be available in other parts of the country such as GRM):

• GRM less than 6;
• 3 units minimum purchased per year for next 5 years;
• 2 to 14 units per site;
• minimum down payment 15%;
• owner carry preferred 2-5 year balloon 5 points over Fed target rate max;
• distressed, unoccupied, REO preferred;
• within 3 miles of OU campus preferred;
• not in flood zone;
• net positive cash flow after expenses and emergency reserves pay down principal on nearest term balloon (no money taken out for personal use – all funds re-invested);
• possibly take in partner/investor as non-operating minority equity holder or lender unless they can mow lawns, paint, hang sheetrock, run a Bobcat, etc.

Mars out.

Driving around you see stuff (our tax dollars at work)…

This wheelchair ramp shouted out to me while I was driving up Berry the other day so I stopped and took a picture.

Who checks this for the city? This meets ADA requirements? There is no sidewalk, a person in a wheelchair needs to use the gutter and street to access the ramp in the first place, there is no access from the other direction, it fills with water every time it rains, slope exceeds 1:16-1:20, etc. The thing is a little concrete project like this is so easy to do right. If I have nothing to do I may look at the other ramps. A gadfly is born.

DISCUSSION REGARDING CHANGE ORDER NO. TWO TO CONTRACT NO. K-0708-2 WITH SAC SERVICES, INC., INCREASING THE CONTRACT AMOUNT BY $38,000 FOR THE FYE 2008 CONCRETE PROJECTS TO MODIFY BUS STOP LOCATIONS TO MEET AMERICANS WITH DISABILITIES ACT REQUIREMENTS.

Mr. Bob Hanger said on July 24, 2007, City Council approved the contract with SAC Services, Inc., and this is an annual contract used to repair existing sidewalks, build new sidewalks, pave alleys, replace driveways, and construct handicap accessible sidewalk ramps through the City. The Cleveland Area Rapid Transit (CART) transportation system has received customer complaints this year concerning access for the disabled at 20 local bus stop locations. They are at Whittier/Brooks; Boyd/Morland; Irving Middle School; Vicksburg Circle/Vicksburg; Shiloh/Boyd; Colonial Estates Park; Lindsey/Wylie; Lindsey/Berry; Boyd/Shiloh; the Community Services Building; Griffin Memorial Hospital; Shiloh/Alameda; Robinson/Porter; Peters/Johnson; Peters/Hughbert; the Senior Citizens Center; Post Oak Apartments; Boyd/Abbey; River Oaks/Cotswold; and Berry/Dorchester. Mr. Hanger said the bus stop at Griffin Memorial Hospital on East Main between Carter and 12th Avenue N.E. is not included in these projects because that will be addressed during the widening of East Main Street.

Norman, Oklahoma, City council minutes November 6, 2007

Mars out.

http://www.access-board.gov/adaag/html/adaag.htm#A4.8.1

I read this post a minute ago and had to shake my head – I spend 70+ hours a week watching subcontractors and try to get them to follow plans and specs for my job. So what do I do during my short 48 hours off for two weeks (includes travel time 700 miles each way)? Somebody shoot me. Ha hahahaha… M