Tom Vu: Get Rich Quick Real Estate Millionaire, Late Night TV Infomercial Pioneer, and...Poker Player???

One of the earliest get-rich-quick real estate gurus to understand the power of the late night TV infomercial was Tom Vu.  By the way, his real name is Tuan "Tommy" Vu.

You just could not escape his sales pitches for creative real estate courses in the 1980s and 1990s.  Not only were they terrible, they were funny.  Here is one captured on YouTube.  In broken English, this Vietnamese-American waiter-turned-real estate "millionaire" surrounded himself with mansions, yachts, helicopters, and especially lots and lots of big breasted women in bikinis pitching his foreclosure and motivated seller home study courses and seminars.

I used to watch the ads just to marvel at his audacity, especially when he would insult his audience calling them "losers" for not ordering his $1,000 products.

Well, Tom Vu has long departed the real estate world.  The answer why is obvious.  The sun does set on all creative real estate gurus and their empires.

Today, Tom Vu is, drumroll please, a professional poker player in Las Vegas.  Here is his page at the World Series of Poker website.  Apparently he's a very good poker player and has won millions of dollars at the tables.

He now lives in Las Vegas and you can find him playing poker at the casinos downtown most nights.

In just another trek down creative real estate guru memory lane, remembering the phonies of the past and the con artists of the present.  At least Tom Vu didn't wind up in Federal prison like William McCorkle or sued into bankruptcy like Joseph Kaiser.  That's one good thing I can say about him.

Robert J. Abalos, Esq.

Treasury Secretary Geithner Says Let Bush Era Tax Cuts Expire: Exactly Who Buys Real Estate Anyway?

U.S. Treasury Secretary Timothy Geithner made the Obama Administration's case yesterday for letting the Bush-era tax cuts on the "rich" (actually those making over $200,000 per year) expire in the name of fiscal discipline.


Coming from a guy who has a history of not paying income taxes this argument was laughable, almost surreal.


Geithner, probably the most inept Treasury secretary in American history, is about as convincing on the subject of taxes as Tiger Woods preaching on the virtues of marital fidelity.


Forget about the macroeconomic implications of hitting people, LOTS OF THEM, with serious tax increases in the middle of a recession.  Not exactly stimulative, is it?


Let's deal just with the implications for real estate.  Who exactly buys rental properties and commercial real estate?  With the industry battered, bleeding, and still suffering, does real estate truly need another serious financial hit?


So who exactly who can buy all those surplus rental properties flooding the real estate markets?  Single mothers working at Wal-Mart?  UPS truck drivers?  What about baristas at Starbucks?  The guy who makes sandwiches at Subways?


It's the upper middle class and the rich, silly.  $200,000 a year isn't exactly rich but these people normally have surplus capital to invest, in of all things, real estate.


Instead of making a mortgage payment on a new rental property held for retirement, these people can now just send the same amount of money to Mr. Geithner so he can make interest payments to the Chinese government on all those bonds he sold them to finance the bloated and growing Federal deficit.


Geithner needs to be fired.  NOW.  This fool has never had a job in the private sector by his own admission and his bizarre ideas and incomprehensible answers to the most serious economic problems of the day prove this daily, unfortunately for us.


Robert J. Abalos, Esq.

Continuity Programs are the Latest Get Rich Quick Guru Trick: Ron LeGrand's New Course as an Example

Late night TV and the Internet are once again filled with real estate get-rich-quick authors pitching their latest "secrets" to millions of dollars and investment success.

Only this time they are recognizing the obvious.  Their target market of victims which are lower middle class paycheck-to-paycheck workers don't have $495 or $1,995 to spend on some ridiculous home study course.  The days of wine and roses are over, economically speaking, for now.

Instead, they pitch what the Federal Trade Commission calls "continuity programs" on its own website.  Here is the FTC warning and description for your reference.

How these programs work is simple.

You buy some small inexpensive item, like a book or CD, and give the seller your credit card information.  The amount doesn't matter, $9.95, $19.95, whatever, even one dollar will do.

AUTOMATICALLY you are enrolled in some sort of "club" or "society" or "program" where you are AUTOMATICALLY billed money every single money UNLESS YOU CALL TO CANCEL.

These amounts can range from $29.95 to $69.95 or even more.

You see the scam?

The original purchase is a loss leader designed to get your credit card billing information and hook you on the program.  The seller often loses money on this sale but makes for it big time over the next few months.

To see a classic continuity program in action take creative real estate guru Ron LeGrand's latest home study course offering.  Here is a link for your reference.

LeGrand, who has been selling get-rich-quick programs since dinosaurs roamed the Earth, has the continuity pitch down just right.

He offers tons of stuff he values in the "thousands" of dollars for just $1.

Yes, those of you who believe you can truly get something for nothing would love this offer.

But wait, in the fine print of the offer at the bottom of the page, after you scroll through thousands of words of sales copy, you find the actual terms of the purchase.

By agreeing to pay $1 for his new wholesaling home study course and all those freebies, you also agree to join his "Gold Club" and pay $59 a month (AND EVERY MONTH) until you cancel.

Also notice that your first month's membership is charged to your card when you make your purchase.  So all that stuff that is pitched for just $1 actually costs you $60.

I will give LeGrand credit for making the sales disclosures visible at the end of the offer.  Normally you need an electron microscope to see the fine print.

But the net effect is the same.  $59 a month, every month, until cancellation.  And if you think canceling is easy, just try.

This scam is popping up everywhere from online real estate courses from "universities" without accreditation to newsletter subscriptions to, just like in LeGrand's case, club and society memberships.

PEOPLE WAKE UP!

You can't buy the secrets of instant unlimited wealth from these characters unless you want to make a fortune running continuity programs like they do.

Robert J. Abalos, Esq.

The American Middle Class is Shrinking and so is the Market for Your Rental Properties

The statistics overwhelmingly prove that the American middle class is shrinking.


Wages have fallen.  Debt has risen.  Equity has collapsed.  What happened to all that real estate equity, all those 401(k)s, and even the income off bonds?


The rich have gotten richer.  The poor have gotten richer too.  But the middle class, that huge bulge of people in the middle that propels the entire U.S. economy, has gotten smaller and is slowly disintegrating.


This simple fact has profound implications for the future of the United States.  And for any real estate development venture or project based on selling to the middle class.


Suburban middle class development is dying.  The old school idea of building subdivisions in within an hour's drive a major city is becoming an anachronism.  It just does not work any longer.  The "Drive Until You Qualify" homebuyer is overburdened in so many ways they are becoming an endangered species.


I meet many real estate investors all the time who are basing their retirement plans on the ownership of "bread and butter" middle class housing, especially single family homes.  I'll rent them out and let the tenants pay off the mortgages, or so the thinking goes.  Then I'll refinance or sell them at age 65.


All I ask is who will buy them in 2020, 2025, 2030?  How will they buy them?  And why?


Ignoring the macroeconomic trend that your target market is disappearing is inviting disaster.


Robert J. Abalos, Esq.

Congress Spends $604,000 on Bottled Water: Interest Rates are Headed Higher, MUCH MUCH MUCH Higher

Your honorable servants in Washington DC are really good at doing three things:

1.  Borrowing lots of money from the Chinese government by ringing up massive Federal deficits.  This fiscal year so far (with three months to go) another $1.1 trillion has been added to the U.S. deficit.

2.  Passing pointless laws that no one wants, no one can understand, and no one can follow.  Want examples?  Start with the Internal Revenue Code, ObamaCare, and the new financial reform law which is nothing but a 2,300 page description of many new administrative agencies and their rule making authorities to come.

3.  And, of course, spending lots of money on themselves, treating each member of Congress like a Renaissance prince straight out of the House of Medici.  The idea of asking American taxpayers, many of them living paycheck-to-paycheck, to pay for the Hollywood lifestyles of Congressman is beyond reason.

The latest example of #3 above comes from an examination of the House Expenditure Report Database where we learn such interesting tidbits as Congress last year spent $604,000 on bottled water and millions of dollars on catered lunches, grocery shopping trips, and bar tabs including at one of my favorite hotels in DC, the Hyatt Regency on Capitol Hill.

Under normal circumstances, such actions would be despicable.

When 18% of all Americans are unemployed and fighting for financial survival and the nation is broke from trillions of wasteful spending, such largess is criminal.

But, of course, it's not just $152 tabs at Quiznos that are killing the country.  Mr. Obama's new budget suggests spending $161 million for the National Endowment for the Arts, a $5 million increase over last year.

Isn't it nice when the nation is closing prisons and public parks, delaying necessary road projects, and eliminating the manned space program all for budgetary reasons we can spend more money on art that no one wants to see or buy?

INTEREST RATES ARE HEADED INTO DOUBLE DIGITS OVER THE NEXT FEW YEARS.

There is no check on runaway Federal spending.  NONE.  The only choice for the Fed is to monetize the debt even if Congress radically raises taxes.  Interest rates are going to skyrocket.

If I had to guess by 2012 or 2013 we are looking at 10%+ mortgage interest rates, if you can get one under Mr. Obama's new financial reform rules, that is.

Robert J. Abalos, Esq.

UPDATE: Representative Charles Rangel Charged with Ethics Violations: Rent Control Apartments in Manhattan for a Congressman Living in DC?

U.S. Representative Charles Rangel, once one of the powerful men in Washington, was today charged with multiple ethics violations by the House Ethics Committee.


I wrote about Rangel's problems in this blog on December 23, 2009.


One of the ethics violations centers around rent stabilized apartments Rangel controlled in New York City. The program is to help people maintain their "primary residence" through rent assistance.


Ask yourself how a Congressman who works and lives in DC can have FOUR "primary" residences in New York at the same time.  Such are the abuses of rent control and why the idea, which never made sense, needs to go finally go away.


Rangel served his country honorably during the Korean War and for forty years in the House.  It is a shame to see a magnificent career like his end this way over something so petty.


Robert J. Abalos, Esq.

Another Update on PennyMac: I'm Still Right

I have been following the continuing saga of PennyMac Mortgage Investment Trust (ticker "PMT") since its IPO in July 2009 in this blog.


Here is my original July 29, 2009 post when I told readers the $20 per share offering price was too high.


Here is my update on December 28, 2009 when I said that the price of the stock, then $17.34 per share was still too high.


Well, today I'm still right.  PMT is trading at $16.34 per share this very moment and has never reached its $20 offering price.  IPO investors have been underwater since Day #1.


PMT is now profitable, reporting seven cents per share in the first quarter of 2010.  This is excellent news for a good company with great people behind it.  But the sector will get hit by rising interest rates and a new recession in early 2010.


I like PMT.  I said so a year ago.  Just not at this price.  By any measure the valuation is rich starting with its negative price earnings multiple.  PennyMac has a trailing P/E of -$.27.


I'll check back again in the future.  Like I said, great sector, great people, great company, just too expensive.


Robert J. Abalos, Esq.

Obama Financial Reform Law Will Drive Down Home Prices and Raise Interest Rates

If you thought getting a mortgage was tough these days, try again in few months once Mr. Obama's financial reform bill signed today into law becomes effective.


Think what would happen in the Post Office ran your local mortgage broker.  That's your future when you go to buy your next home.


Here is one excellent analysis of what will happen under the new financial reform law, including higher interest rates on mortgages and much more paperwork to get them (including having to prove to the U.S. government and not just your bank you can afford the monthly payments).


I'll go further.  A lower number of buyers mean home prices must fall.


Fewer borrowers will qualify under the new rules.  Banks will write fewer of these loans because, let's face it, why bother?  They are now required under this new law to hold many more of them in their portfolios which sounds like a good idea but ask yourself this question.


Given the reckless government spending, the massive $1 trillion Federal deficits, the certainty of higher interest rates, the likelihood of a double dip recession coming early in 2011, and all the monetary mismanagement lately by the Fed, would you loan someone $250,000 on a 30-year note at just 4.5%?


This is an absurd risk and bankers are not stupid.  Many will exit this line of work if they cannot readily sell the notes to investors to spread the risk.


What the feeble U.S. economy did not need was yet more government regulation and paperwork.


It got TONS and MILES of it in spades today.


Robert J. Abalos, Esq.

Five Retarded Get Rich Quick Schemes (and Guess What Scam is Number One)

The "Get Rich Quick in Real Estate" schemes you see advertised all over the Interent and late night TV are just that.  The promoters and sellers of these home study courses, seminars, and mentoring programs GET RICH QUICK.


The buyers of these programs rarely make a dime.


People fall for these creative real estate con artists for the same reason people get burned by Nigerian phishing scams or any criminal confidence game.  Desperate people need money quick and that is what these Internet scammers promise, but of course, never deliver.


I read with great interest and humor this analysis by Cracked.com of the "Five Retarded Get Rich Quick Scams" that people STILL fall for.  And this is the point.  All my warnings on this website, the warnings of the Federal Trade Commission, and virtually every other consumer protection organization, and just plain common sense cannot save someone from their own greed.


The target market for these get-rich-quick con artists are lower middle class people without any experience in real estate, so-called "newbies" in the trade.  The single mother with two kids working at Wal-Mart because her ex-husband is not paying child support is willing to pay $495 for a home study course on flipping properties or short sales because she has no other way out of her predicament.  She's willing to spend a week's wages on a chance at financial security because some real estate "millionaire investor" is willing to share "the secrets" of building instant wealth through rental properties.


But buyers of these courses and seminars quickly learn that the moment they open their new purchase there are no magic secrets inside.  All they will get from their new real estate millionaire mentors is a series of sales pitches to buy more and newer courses.


It is called "upselling" in the trade.  And if you buy from these gurus they place you on a "sucker's list" and share your name so other gurus can also pluck you like a chicken.


Go to any of the seminars where these products are sold and you will see the sheep being led to slaughter, lining up with false enthusiasm to buy a ticket to Financial Paradise.  It's sad, pathetic, but all too understandable.


The Cracked.com analysis of RETARDED get rich quick schemes has it perfectly right.  John Beck, currently being sued by the FTC for $90 million is just one example of many of these gurus that knows the buyers of these programs are losers the moment they reach for their VISA cards.


But notice which Get Rich Quick scam Cracked.com regarded as being the most retarded, Number One on the scale of dumb to dumber.


Robert J. Abalos, Esq.

The Strange Adventure of Michael R. Mastro

Real estate investor Michael R. Mastro has been a living legend in Seattle for generations.  Hugely successful as a developer and rehabber for more than forty years, he had been part of downtown Seattle for as long as anyone can remember.


Then, in 2009, due to excessive leverage and the collapse of the real estate market, he was forced to file for bankruptcy.


But this is where the interesting story really just begins....


Here is an excellent piece from the Seattle Times on how to live like a King when you supposedly ain't got a dime.  Much can be learned by real estate investors by studying how Mastro built his empire and why it collapsed.


I once met Mr. Mastro years ago briefly at a charity event.  He was as charming as you would expect from anyone who could wheel and deal in large commercial properties for decades.


But now, Seattle is abuzz over the story of the man who fell from grace but somehow still lives a lifestyle fueled by nothing but grace.


Robert J. Abalos, Esq.

Bite of Seattle and a Great Lost Marketing Opportunity

The Bite of Seattle is an annual three day celebration held at the location of the old 1962 World's Fair in downtown Seattle, literally at the base of the Space Needle.


It's all about FOOD, lots of food, and free music and hundreds of thousands of people having fun.  What makes this event all the more impressive is that it is free.  No admission fees are charged of any kind.


I was there yesterday on what is probably the most perfect day in the history of always rainy and gloomy Seattle.  Sunny, cool, weather just about as ideal as any major public event could expect.


From the photo, you can learn two key points.  How close the stages are to the iconic Space Needle and what a poor photographer I am.


Anyway, what was relevant for me while I wandered the endless aisles of Junk Food Heaven (Funnel Cakes, yummy!) and saw the few arts and craft vendors selling their homemade wares what a lost opportunity this event is for real estate investors and investment based companies.  There were some larger companies advertising through display booths, like GEICO and Verizon and especially the event sponsor Comcast, but not a single real estate firm of any kind. 


No sales companies like Century 21, John L. Scott, or Windermere, all huge residential brokers in the Seattle area.


No rental companies like Equity Residential or AIV pushing apartment rentals.


No contractors or home repair companies like Roto-Rooter or Terminix Pest Control.


Home Depot Installation, a vinyl siding company, and a small hardware store chain are sponsors of the Bite so the question is raised.  Why not more real estate?  Why doesn't one single real estate investor market their "I BUY HOMES" message there?  Who wouldn't want a captive audience of 100,000 people every day walking by their booth?


Every single one of the hundreds of thousands of people who visit "The Bite" have one thing in common besides the love of music and junk food.  They all live somewhere.  Either they rent or own their own home.


What a wasted marketing opportunity.  The Bite could have used the revenue.  The crowd could have used some practical real estate advice and information.  And we all, in the end, could have enjoyed a diversion from all those French Fries, ice cream, gyros, and kebobs that don't exactly sit well in the stomach the next day.


Robert J. Abalos, Esq.

New Investing in Land Website Debuts September 1, 2010

After many delays the new Investing in Land website will debut on September 1, 2010 along with a new edition of my flagship publication, Investing in Land, the most comprehensive guide for land investors and developers on the purchase, financing, subdivision, and development of land ever written.


Over the next few weeks I am going to be giving you glimpses of what is behind this unique project.  But I can assure you it is unlike any real estate website you have ever seen.


From 2001-2007 I ran my original Investing in Land site and if I had to summarize my overall message it would have been this:


"Real estate prices are too high.  Sell if you can.  Don't buy.  Too risky"


I can honestly say now the message of the new site is this:


"Land prices have fallen hard and now is the time to start buying.  Attractive valuations.  Bargains galore."


I await the release of my new book with much anticipation.  August will be a long month.


If you have never written a book you can't experience the feeling of writing one and then waiting for its release.  It's like being a pregnant woman who has been carrying a child for 36 months.  Enough is enough.  It's time to get it out!!


Robert J. Abalos, Esq.

Bridget Fonda Wouldn't Want to Live There Anymore

One of the reasons the world fell in love with the city of Seattle in the early 1990s was the grunge rock movement.  Nirvana, Soundgarden, Alice in Chains.  Kurt Cobain and Pearl Jam.


The other reasons were the films SLEEPLESS IN SEATTLE and director Cameron Crowe's brilliant Valentine's Day card to his native city, SINGLES.  This 1992 film shot on location in Seattle starred Bridget Fonda, Matt Dillon, Campbell Scott, and Kyra Sedgwick and centered around life in an apartment building where all the tenants knew each other and were desperately searching for love.


Well, the apartment building featured in the film is located at 1820 East Thomas Street in Seattle in the Capitol Hill area of the city.  I decided to visit the location after recently seeing the film again (for about the tenth time!) and report what I found.


Bridget Fonda would no longer want to live there.

The crisp and neatly manicured apartment building in the film is now poorly maintained, rundown, and seedy.  There are tall weeds and debris everywhere. 


The building is far smaller than the film's lens makes it appear.  You get an almost claustrophobic feeling spending time in the small courtyard which, by the way, never had a fountain like the film portrays.  It was added just for the movie.

What is ironic is that this building is in a far nicer neighborhood today than it was in 1992.  Back in Bridget's day this area, east of 15th Avenue on Capitol Hill, was extremely gritty and rundown to put it mildly.  There has been extensive gentrification over the last ten years with many of the old rooming houses replaced by modern condos and townhouses.  For those who remember the grunge era, for example, the home called "The Rat House" occupied by murdered singer Mia Zapata and her band, The Gits, was just four blocks away from Bridget's place.  The band gave this distinctive name to their own home because the owner of the building claimed that by eating the rats that lived in the house he scared the other live ones away.  He proved to them who was boss when he made a soup from their corpses.


Understand what kind of neighborhood this was back when SINGLES was filmed?


I spoke to a tenant at the property, a young girl who was four years old when the movie was released.  She did not know the film or the building's place in movie history but she was excited to learn the facts about her apartment.   The opportunity to market these apartments through the film have been completely lost by the owners.

I have posted a bunch of photographs I took of the building on my Picasa website here.  You can see for yourself what the building looked like then by watching the movie (available on Netflix and everywhere) and what it looks like now.


After analyzing thousands of rental properties over the last thirty years I can tell you this without any doubt.


This property needs a good resident manager.  None lives on site.  There is no sign even telling prospective tenants who manages the building or how to contact the owners in the event of trouble.  The tree growing on the street on the right side of the building blocks the iconic view most people remember from the film and needs to be pruned.  There is rust, peeling paint, and tall weeds everywhere all can be.

SINGLES is one of those great undiscovered gems of a film and that's probably what Cameron Crowe, who went on to direct the Oscar-winning film, ALMOST FAMOUS, intended when he made it.  Simple characters in a simple story.  You can't watch this film without wanting to live in Seattle because the city itself becomes a leading character in the film, as naive, proud, fun, and unique as Bridget, Matt, or Kyra are on screen.


Unfortunately the Seattle of the film is long gone, not better, but different, and my visit to 1820 East Thomas Street on Capitol Hill yesterday proves it.


Robert J. Abalos, Esq.

Fed Considers Even More Monetary Stimulus Due to Declining Economy

Forget about the fiscal stimulus problems I wrote about just two hours ago in this blog?  Well here is yet another daily reminder the lunatics in DC have taken over the asylum.


Fed Chairman "Helicopter" Ben Bernanke is seriously considering even more monetary stimulus due to the obviously deteriorating economic situation in the United States which is becoming more and more obvious by the day and, coincidently, I have been forecasting in this blog for nearly a year.


I am reminded here of those old school doctors who believed the way to heal a patient was to bleed the illness out of him.


Yes, these techniques killed George Washington and many others.  But did such nonsense ever really make sense except to the most simplistic minds?  If you can figure out how bleeding a person can make them healthy there is hope for you.  A job at the Fed is waiting.


Does any rational person believe the Federal government alone can stimulate a moribund and declining $14.3 trillion economy with yet another round of stimulus when the previous THREE rounds have not worked?


What is the definition of insanity?  Doing the same thing over and over again and expecting a different result?  And what type of additional stimulus do Ben and Company have in mind?  Interest rates are already at zero percent and the Fed's balance sheet is a mess.


Just hours after I'm writing about my concerns for inflation and skyrocketing interest rates Bernanke makes my original post today seem tame.


Madness.  Sheer madness.


Robert J. Abalos, Esq.

Federal Budget Deficit $1 Trillion So Far This Year: Think About Interest Rates

Your public servants in Washington so far this fiscal year have spent more than $1 trillion than they took in though taxes and fees.


$2.6 trillion spent.  $1.6 trillion in taxes.  You do the math.


And there is still three months to go on the fiscal year.  There is much more spending to do.


For the record, Congress spent more than $1.1 trillion last year they didn't have.


We are now in the 21st straight month of deficit spending.


Um, is anyone thinking interest rates and inflation?  The banks are getting a great deal borrowing at zero percent interest and then buying Treasuries at 3%.  Nice money when you can get it.  But it is INEVITABLE that when interest rise---and they sure can't fall any lower---they are going to have to rise SHARPLY to squeeze out all this outlandish fiscal stimulation or inflation will literally explode.  Think Fed policy in the early 1980s, only this time on steroids.


Every real estate market I am studying is getting more unhealthy and the extreme tight money and skyrocketing interest rates that are coming over the next five or so years will only make matters worse.


Congress needs to grow up and stop acting like a college freshman who got their first VISA card. I would say stop spending like a drunken sailor but that is an insult to drunken sailors everywhere.


Robert J. Abalos, Esq.

MUST READ BOOK: Value Investing by James Montier

Everyone knows I am a classic Graham and Dodd value investor who (has) worshipped at the altar of Warren Buffett for many years.


THE INTELLIGENT INVESTOR by Benjamin Graham has been the definitive text (along with his massive tome, SECURITY ANALYSIS) on value investing techniques for decades.


Now it appears we have another book to add to this collection.


VALUE INVESTING by author James Montier is a stunningly comprehensive analysis of why value investing trumps all other forms of investment.  This is no superficial analysis of the subject but a highly detailed and statistical review of how buying on the cheap is the only method of securing long-term profits for investors.


Lots of graphs, lots of charts, lots of numbers, and most of all, lots of analysis proving what Graham, Buffett, and I have been telling investors for years.


Buy low, sell higher.


NOT buy high, sell higher.  This is momentum investing and it does not work over time.


To get you started before you buy this excellent book, here is an interview with James Montier where he explains some of his ideas.


I cannot recommend this book more highly.  BRILLIANT on every level.  Every page is bristling with critical advice for investors.  This book is simply stunning to read for its depth and practical advice.


For the record, I do not know the author and have no financial stake in the sale of this book.


Robert J. Abalos, Esq.

New Federal Trade Commission Warning on Real Estate Investment Seminars

The Federal Trade Commission has been warning consumers for years about get-rich-quick investment seminars, especially the creative real estate variety you see advertised online and through late night TV infomercials.

Here is one of their classic warnings.  The FTC's advice is excellent and virtually no "Make a Million in Real Estate" home study course or seminar offering could pass their official test.

The FTC has just published a new warning, a more visual one that can be printed as a PDF document.

The gurus who sell these investment seminars need to know that a MAJOR law enforcement crackdown in this area is coming.  I am in frequent touch with FTC investigators and I cannot wait to announce some new prosecutions on this front.

The bottom line is simple.

NO real estate author, promoter, or guru can promise you a positive result if you buy their products.  If you think you are going to get some "magic secrets" on how to achieve real estate success for $495 and buy yourself a lifetime of income and happiness for the price of a seminar ticket you are as DUMB as these seminar promoters think you are.

Robert J. Abalos, Esq.

When Will The Get Rich Quick Real Estate Gurus Admit They Were Wrong?

From 2002 through 2008 while running my website at InvestingInLand.com I warned investors hundreds of times through my newsletter and website articles that real estate prices had gotten way too high, far above their intrinsic values, and that a real estate bubble and crash was inevitable.

Of course, at the same time a rabid wolfpack of get rich quick creative real estate gurus flooded the Internet and late night TV claiming it was the best real estate market in a century and investors who bought properties would make a fortune.

Well, I was right.

They were wrong.  These criminals encouraged and presided over the greatest financial loss in history, costing real estate investors more than $10 trillion dollars.

$10,000,000,000,000.  A lot of zeros.  A lot of ruined lives.

You would think after such a devastating humiliation these slick salesmen of mostly worthless real estate home study courses and seminars would crawl back into the dark holes in the mud that spawned them.  But this would actually require a conscience and some shame.

Starting once again in 2008 these very same discredited frauds put away their flipping property home study courses and began pitching foreclosure investing, short sales, and whatever else they could imagine gullible people would buy, proclaiming it was the best real estate market in a century.  Look at all the bargains!  The low interest rates!  All those motivated sellers!

Me?  I warned investors that prices were still way too high and a double dip recession was coming, especially in the real estate markets.

Well, once again I'm proven right.

Here is what I wrote about the imminent double dip recession in November 2009.

Here is what I wrote about the imminent double dip recession in real estate in March 2010.

And here is what the mainstream financial media is saying about the double dip recession in real estate today.

IT'S HERE.

What am I predicting now, beyond of course stagnant and negative investment returns on real estate for at least the next five years?

Another crop of get rich quick creative real estate guru course offerings arriving in your email inbox very soon.

Robert J. Abalos, Esq.

Great Investment Advice from the Moguls at Sun Valley

The annual Allen & Company Sun Valley Conference is underway in Idaho and the wealth of investment ideas that pour forth from this gathering of the world's greatest business moguls is staggering.


Why do you think all the invited corporate titans attend this event every year?  Why do you think private investment bank Allen & Company hosts it?


To network for sure.  But they network with each other plenty every day of the year.


They go to Sun Valley in July to escape the Manhattan heat and to learn about business conditions from each other.  A glass of Domain Romanee-Conti (or two, or four....) can open a lot of lips.  You learn things you can't read about in Business Week.  You get investment tips over a wink and a nod and by reading between the lines.


Plus where else can you see billionaires like Michael Bloomberg wearing white socks with shorts?


The media is extensively covering the event.  There is LOTS and LOTS for investors of all budgets large and small to learn about the direction of the economy and much more.


You might not have been invited to Sun Valley this year but that doesn't mean you can't learn a whole lot from what is being said outside your presence.


Robert J. Abalos, Esq.

Do These Two Inspire Confidence in You?

Here are the two men who control the American economy.  Mr. Obama and Mr. Bernanke.


Both have never had a real job in business, in fact, the closest either actually came to a real job was as a college professor.


Neither has ever run a company, created a product or service, met a payroll, or given them any relevant experience as an "employee" in the "workforce."


Yet, both men now make laws and draft new regulations that govern every aspect of the American economy.


Does it take a business genius like Herbert Hoover to run a successful economy?  Of course not.  Hoover made millions for himself in the mining business and ran some of the largest and most successful philanthropic projects in history.  Yet his presidency was an economic disaster.


But I'll take Hoover's business experience over Obama's and Bernanke's lack thereof any day.


Yesterday's news:  Truly awful consumer confidence numbers.


Today's news:  Only 13,000 new private sector jobs created in the U.S. in June.


This is not a recovery.  I just don't see it.


Robert J. Abalos, Esq.

New Housing Sales Numbers Hit All-TIme Low: Kennedy Was President in 1963

The new home sales numbers released today by the U.S. Commerce Department reflect a drop in sales so severe the industry is now selling homes at an all-time low, in fact, the lowest sales rates ever recorded since the government started keeping these numbers in 1963.


When the Obama tax credit expired, buyers stopped buying homes.


Very predictable, too.  But at a cost of $100,000 of taxpayer money per home sold under the tax credit incentive a very predictable expensive blunder too.


Robert J. Abalos, Esq.

New Middle Class Income Taxes Will Further Depress Residential Real Estate Prices

There is going to be a major income tax increase after the November 2010 elections.


The Federal deficit is way too high.  Even Democrats, like House Majority Leader Steny Hoyer admit that a middle class income tax is going to be necessary to raise money.  Not just new taxes on "the rich" (above $250,000 per year for a married couple is the official Obama definition) and not just the expiration of the Bush-era tax cuts.


NEW taxes on the middle class.


The simple fact is that the tax code has become so progressive that the poor no longer pay income taxes in the United States.   A full 40% of American households no longer pay any Federal income taxes.


This leaves the rich and the middle class.  The rich are already getting savaged by the U.S. income tax code.  The top 1% of all American households already pay a whopping 36% of all Federal income taxes.


So, that leaves the middle class, Steny Hoyer's latest target.


Higher taxes on middle class people means that real estate prices will fall.  Why?  Stayed tuned, but think about it in the meantime.


Robert J. Abalos, Esq.

Obama Foreclosure Relief Plan Fails---Just Like I Said It Would

The Obama foreclosure relief plan is failing badly after spending $75 billion to help homeowners in foreclosure.


No surprise here.  I predicted this futile program would fail nearly ONE YEAR AGO in this blog.


You can read an excellent article explaining the problems with the loan modification plan here.


The bottom line is simple.  When you buy a home you just can't afford, eventually you lose it.


Robert J. Abalos, Esq.

Russ Whitney's Former Lawyer Gets 50 Year Prison Sentence

Real estate guru history wonks will remember the very nasty and bitter legal dispute between get-rich-quick creative real estate guru Russ Whitney and real estate author and watchdog of the very same industry John T. Reed from a few years ago.

Reed, having published a single email critical of Whitney's seminar offerings on his website, found himself being sued by Whitney in a number of state and Federal courts in Florida, the headquarters of Whitney's real estate information empire.


John T. Reed refused to give in and began a campaign exposing the various falsehoods of Whitney's career, such as how he (didn't) turn $1,000 into $4.7 million through real estate investment while working as a slaughterhouse worker in Upstate New York which was the cornerstone claim of his empire.


For a time, the real estate world was abuzz with the controversy, and many of us (including me) followed the dispute like a real world soap opera with daily updates from both sides.

Anyway, Russ Whitney's lawyer in these lawsuits filed against Reed was named Scott Rothstein who made a name for himself in these disputes not only with the numerous lawsuit filings but also his bizarre reasons for requesting continuances, like the need to go on vacation because he already booked tickets!

Mr. Rothstein has been in the news quite a bit lately, having been found guilty of stealing over ONE BILLION DOLLARS ($1.2 billion, actually) as part of a Ponzi scheme.

He was just sentenced to FIFTY YEARS in prison.

Of course, you can't tar Russ Whitney with the same brush wielded by Scott Rothstein.  Birds of a feather often do flock together, but then again sometimes they don't.

What I can say without question is that the prosecution of John T. Reed by Whitney was prosecuted in a grossly unethical manner and certainly Mr. Whitney approved of every action by his own lawyer, further illustrating for me how truly grotesque the get-rich-quick real estate industry really is.

This is just a little bit of trivia for you creative real estate guru enthusiasts out there.  Just another lesson in those that play with fire often get burned.

Robert J. Abalos, Esq.

U.S. Housing Market in for More Trouble Ahead

Here is an excellent analysis by real estate analyst Dean Baker who essentially says the same thing I have been telling you here in the blog and in my other writings for years.


The U.S. residential housing market is still overvalued and the optimists who are jumping in and buying all these foreclosure homes are making a big mistake.  I see lots of cheerleading on these real estate markets but very little genuine logic as to why its a good time to buy.  Lower prices alone does not mean a bargain.


I see NO catalysts, NONE, that will lift housing prices higher for at least the next two or three years.


I see LOTS of reasons why prices can still fall.


Dean Baker was right on the housing price bubble (like I was) and his views should be respected once again here.


Robert J. Abalos, Esq.

White Flight from Suburbs Dooms Traditional Subdivision Development Model

As I have written for years, the traditional sprawl suburban subdivision development model is doomed.


Educated white collar professionals who have been the target market for most suburban development since the 1950s are tired of long commutes on congested roads into their workplaces.  Along with all the daily hassles comes declining public schools, higher property taxes, fewer social services, and quite frankly, not a whole lot to do on weekends or at night.


Every suburb I have been studying in the United States for investment is becoming less "white" (for lack of a better term), poorer, with a declining property tax base.  At the same time the urban core near these suburbs is growing.


This article from the Associated Press confirms this trend I have been writing about since 2004.


I will be having much more to say about this trend and what it means for homebuilders and developers in the near future.


Robert J. Abalos, Esq.

Obama Health Care Bill Will Cause Price Decline in Rental Property Values

Mr. Obama's new health care bill places a new tax of 3.8% on all so-called "unearned income" including dividends, interest, and rental income for taxpayers making above $200,000 per year.


The new tax, now cynically called an "unearned income Medicare contribution", is really just another surtax imposed by Mr. Obama to get "wealthy" Americans to pay for his health insurance scheme.


Anyone who has ever managed rental properties and all the headaches tenants can give you know that rents are EARNED income.  I find this Orwellian definition of rental income offensive and ignorant.


But more importantly, imposing a 4% Federal tax on rental income has to depress the prices of rental properties by at least that much.  Use any capital asset pricing model ("CAPM") to get the actual value with respect to any property.  When the costs of owning an asset, or more accurately, owning its income stream rise, the value of the asset must fall to adjust the yield for investors relative to another investments or uses for capital.  This is basic Corporate Finance 101. 


So at a time commercial real estate is struggling, and the banks who hold this paper are afraid for dear life, the Federal government decides to milk this sick cow for another 4% per year.


What a way to run an economy.


Robert J. Abalos, Esq.

Don Corleone and Alan Greenspan?

Alan Greenspan was testifying before Congress yesterday and it was obvious he still doesn't understand his primary role in creating not one, but TWO, investment bubbles during his watch as Fed Chairman.


NASDAQ, 1999
Real Estate, 2007

As regular readers of this blog and my other writings know, I'm not a fan of Mr. Greenspan or his successor, Mr. Bernanke.  I wouldn't hire either one of these guys to run a cash register at a 7-11, let alone run the Central Bank of the United States.  There isn't a thimble's worth of common sense between them.


But Greenspan has gone from an idol in the financial world to a pariah in just three short years.  And he still believes his "Greenspeak" song-and-dance pony shows can charm the masses, holding sway over public opinion as he once did like a hypnotist on a stage.  I once wrote that the saddest thing to witness is an unfunny comedian doing his act.  No, that's now #2.  Leading the pack is a former Fed Chairman who still doesn't get it.


I watched his testimony yesterday and I really felt sorry for the guy.  I'm sure he's a nice man who likes dogs and buys his wife, NBC correspondent Andrea Mitchell, pretty flowers on her birthday.  But as an economist or a Fed chairman he's just clueless.  A taxi cab driver from the streets of Dayton, Ohio pulled out of his hack at random would have done a better job at the Fed.  And that's no slight against taxi cab drivers either.


Want to see how bad the ridicule has finally gotten?  Check out this video clip of Greenspan being compared to "Godfather" Don Corleone by talk show host Dylan Ratigan.  Yes, it's hyperbole but he's not far off the mark.


On a more serious note, check out GREENSPAN'S BUBBLES: THE AGE OF IGNORANCE AT THE FEDERAL RESERVE the wonderful book by author William Fleckstein that makes it very clear Alan needs to rethink his legacy, and do it REALLY REALLY fast.


Robert J. Abalos, Esq.

MUST READ BOOK: The New Empire of Debt by William Bonner and Addison Wiggin

"In the last half of 2008, the Empire of Debt received the margin call from Hell."


And so begins the captivating book,  The New Empire of Debt: The Rise and Fall of an Epic Financial Bubble by authors William Bonner and Addison Wiggin.


If you are concerned (like me) that America is quickly spending itself into oblivion and third world nation status, this is a must read for you.


Yes, the authors lay out a compelling case that politicians are borrowing and spending money so fast that the once great American empire has become a hollow shell.  But they do it in a witty and often humorous way that H.L. Mencken would have found amusing.  (He's actually quoted in the book.)  I feel that much of what I read in this book is gallows humor, disguising the sad fact that Washington and Wall Street are devouring our national wealth for the sake of their own aggrandizement while Main Street suffers and sacrifices to pay the bills.


Politicians point to the latest financial crisis and scowl with derision about all the accounting gimmicks and social mistrust that has been generated.  But the investment bankers and bond analysts who sold bogus derivatives are mere amateurs compared to the waste, fraud, and numerical slight-of-hands occurring daily on Capitol Hill.  The hypocrisy is stunning, and quite disturbing to witness---and funny to read, in a black humor sort of way.


The United States is approaching ONE HUNDRED TRILLION DOLLARS in unfunded mandates, loan guarantees, pension liabilities, entitlement program promises, and fiscal deficits.


The entire Gross Domestic Product of the United States last year was only $14 trillion.


And the number keeps growing...and growing...and growing...with no end in sight.


As this wonderful and insightful book makes clear, the two greatest economic empires of the 20th Century were the United States and Japan.  The Japanese built a powerful industrial machine on the ruins of a devastating country and within thirty years were the envy of the world.


Not anymore, however.  Too much debt, investment speculation, fiscal mismanagement, and internal political strife has left the country mired in economic recession for nearly twenty years now.  And nothing is likely changing anytime soon for the people in Japan.


The New Empire of Debt: The Rise and Fall of an Epic Financial Bubble makes clear we are next unless matters change, and change REALLY REALLY REALLY fast.

For the record, I do not know these authors and have no stake in the sale of their book.  I am recommending it to you because it is not only essential reading but utterly fascinating to devour.


Robert J. Abalos, Esq.

Treasury Bond Yield Hits 4% at 18-Month High: Bad News for Real Estate Investors

The 10-year Treasury bond broke a 4% yield today, a major resistance point for technical traders and a serious foreboding of higher mortgage interest rates to come.

This was the first time the yield crossed 4% in 18 months, or since October 2008.

Higher yields are on the way, given weak demand for the bonds at the current coupon rates and wildly high inflation fears. Would you loan someone money with a balloon payment due in ten years at just 4% per year in this economic climate?

Just three days ago in this blog I warned readers of higher interest rates to come.

Guess what? They're here.

Robert J. Abalos, Esq.

Double Digit Mortgage Interest Rates Coming by 2014

Mortgage interest rates on residential and commercial properties in the United States will be in double digits by 2015 and likely even sooner.

The analysis here is simple.

The Federal budget deficit is out of control. The CBO now estimates that by the year 2020 the Federal deficit will be NINETY PERCENT OF U.S. GDP. That is TEN TRILLION DOLLARS of new debt from just 2010-2020 and does not take into account all the new spending programs Mr. Obama and Ms. Pelosi are dreaming up over coffee in the Oval Office.

Inflation in March 2010 was at an 18-month high. The pressure growing on the Fed to monetize the massive Federal debt is obvious. Read this article from columnist Michael Kinsley on Mr. Obama's ideas for using inflation to pay down the national debt he caused during this first year in the White House. The worldwide risk of hyperinflation is growing and this fear factor on bond yields and long-term mortgage rates should not be ignored.

The demand for U.S. Treasuries is falling as Japan and China are no longer buying them at their usual rates. China is now a net seller of Treasuries. Buying is now at six-month low. Simply put, these nations have their own financial concerns and are not satisfied with the low rates on these bonds any longer. This factor alone has "dire consequences" for mortgage interest rates in the U.S. The artificial mortgage rate subsidy from China and Japan that gave Americans all those record low interest rates from 2000-2007 is now gone.

Mr. Bernanke at the Fed is going to have to start raising interest rates more sooner than later. Most estimates are between six to eighteen months, and once he starts they have nowhere to go but up. They have been stuck at near zero percent for far too long.

The near term outlook for U.S. real estate is grim. Too much supply, not enough demand, disappearing government incentives to buy, tight mortgage money, rising interest rates, high foreclosure rates still keeping down prices, and a hidden market of sellers desperate to unload properties but just waiting for any prices increases to do so.

Real estate investors have lost trillions of dollars in the last three years, and homeowners even more. There is no speculative incentive to buy most categories of properties anymore. Does anyone think they are going to get rich anytime soon buying and renting out condos? All the conventional buy-and-hold or buy-and-flip real estate profit models are obsolete and have failed investors miserably.

There are ways to play this gruesome market and I'll be discussing them in the weeks and months ahead.

Robert J. Abalos, Esq.

Canadian Broadcasting Corporation Reporter Please Call Me Back

To the CBC reporter who called me yesterday.

Please call me back at 206-289-0320 and leave your number again. Your message was garbled on the recording and I have no way to reach you again but this post. You can also email me with your contact information at robertjabalos@gmail.com. I have the information you requested but I can't get it to you.

Robert J. Abalos, Esq.

Robert Abalos Interviewed by DATELINE NBC on Get-Rich-Quick Real Estate Guru Fraud

DATELINE NBC, the same television show that has exposed child molesters and pedophiles in the past, now has a new target equally as vile and predatory and worthy of swift prosecution.

Get-rich-quick creative real estate gurus.

Today I spoke to one of their producers by phone. I had a great deal to say. For the record, they contacted me.

The get-rich-quick real estate hucksters you see on late night TV infomercials and scattered all across the Internet have stolen TENS OF BILLIONS OF DOLLARS from the public over the last thirty years. They need to be held responsible and, most importantly, put out of business once and for all for all the financial carnage they have caused.

These phonies who preach how you can become instantly wealthy through investing in real estate using none of your own money are partially responsible for the greatest destruction of personal wealth in human history. They mislead millions of people to buy expensive and overpriced real estate at a time no reasonable person should have been buying. But today they do not mention how wrong they were about the "real estate bubble" or the market conditions they touted to sell their home study courses.

These creative real estate gurus and the interlocking networks they use to sell their products, which Federal law enforcement officials investigating them now describe as "organized crime" , defraud mostly lower middle class working people of up to $1 billion per year. The home study courses, seminars, mentoring programs, and other goods and services they sell are essentially worthless---and they know it. The only people getting rich with these courses and seminars are the people selling them.

These slick get-rich-quick in real estate hucksters do not let the truth stand in their way of making huge profits, sometimes reaching $300,000 or more PER DAY. When critics like me challenge them on their misstatements, their intentional falsehoods, their fabricated testimonials, their failure to comply with basic accounting standards, and all the other lies and distortions they use to sell their overpriced garbage, we are confronted with campaigns of death threats, slanders, and other harassment designed to drive us into silence. Read about my experience here.

All the threats haven't worked in my case, and won't into the future.

I will let you know when DATELINE NBC runs their piece. I can't wait to see it. I would love to be part of it.

Robert J. Abalos, Esq.

Double Dip Recession in U.S. Residential Housing Market Coming

The latest home price data came out today from S&P and despite small increases in housing prices overall the news was, as the report says, "mixed."

You can read all the analysis as the The New York Times covered it below.

I have been saying a double dip recession is likely here in this blog for months. In fact this blog post quotes Mr. Obama agreeing with me. The current "economic recovery" is really nothing but a sick and damaged economy being supercharged by trillions of dollars in hot government spending.

It's like taking the proverbial 90-pound weakling from the old Charles Atlas ads and pumping a liter of pure adrenaline into his veins and then turning him loose on the community. He may look active but he sure isn't healthy.

Just think about all the Federal spending since the housing bubble burst.

TARP I and TARP II

Cash for Clunkers

First Time Homebuyer Tax Credit

Bailouts for Fannie, Freddie, AIG, Citibank, and all the rest

Mr. Obama's $737 billion economic stimulus bill

I could go on but why? Instead read this Heritage Foundation report on why Federal stimulus programs do not work and are just a waste of money and actually counterproductive.

The economic fundamentals for the U.S. residential housing market are terrible. Look at supply and demand and answer one question for me.

"What catalysts lift housing prices higher?"

Sorry, there aren't any in the short term. Not until at least 2013 at the earliest, and maybe not even then.

Robert J. Abalos, Esq.

*******************************************************************

U.S. Home Prices Inch Up, but Worries Remain

Housing prices edged upward in January, according to data released Tuesday.

The Standard & Poor’s Case-Shiller Index rose 0.3 percent in January from December, seasonally adjusted, its eighth consecutive monthly increase.

But the apparent good news in the widely watched measure masked underlying troubles. David M. Blitzer, chairman of the index committee at Standard & Poor’s, called the report “mixed.”

“While we continue to see improvements in the year-over-year data for all 20 cities, the rebound in housing prices seen last fall is fading,” Mr. Blitzer said.

The seasonal adjustment of the data lifts the numbers in the soft winter months. On an unadjusted basis, the index fell 0.4 percent in January from December, extending a pattern of decline.

House sales rose in the fall as buyers and sellers eagerly did deals before the government’s $8,000 tax credit was scheduled to end Nov. 30. Congress then extended the credit until April 30, but the momentum was lost. Sales volume immediately plunged.

Other housing indexes, which use different sets of data from different communities, show that the expected ending of the credit was also hard on prices.

The First American CoreLogic Home Price Index dropped 1.9 percent in January, double its decline in December. The Federal Housing Finance Agency’s index dropped 0.6 percent in January after falling a revised 2 percent in December.

Analysts said that Case-Shiller would eventually slide as well.

“It is only a matter of time before the index records a double-dip in prices,” Paul Dales of Capital Economics said.

The housing market bottomed last winter. On an annual basis, the Case-Shiller index is now down less than 1 percent. Prices are down about 30 percent from the peak in the summer of 2006.

Twelve of the cities in the index went up in January from December. Los Angeles was the biggest gainer, up 1.7 percent. Chicago was the biggest loser, dropping 0.8 percent.

With the January 2010 data now published, it is possible to track the best and worst cities to have owned real estate over the century’s first decade.

The three best cities are no surprise: Los Angeles, New York and Washington. All are more than 70 percent above their level in January 2000.

Anyone who bought in Las Vegas would have lost a few dollars after paying their agent’s commission. But the worst-performing city in the index was Detroit, which ended the decade 28 percent below where it began.

Most of the Investment Advice You Read on the Internet is Wrong

If you need any proof of how bad most of the investment advice you can find on the Internet really is just read this article on residential real estate markets and their outlook for 2007 from MONEY magazine. The article was written in May 2006, just as the real estate bubble was bursting.

A 3.4% loss for Las Vegas real estate in 2007???

A 21% gain for Panama City, Florida???????????

Most investment publishers like MONEY and most real estate get-rich-quick websites constantly cheerlead markets. CNBC does it too. They want you to buy into the notion that investing is easy and fun and everyone can do it in your spare time on weekends between trips to the mall and mowing the lawn.

It's not. It's hard work and risky. 80% of investors in any market lose money. Even the professionals are not immune. They lose money at the same rate as the amateurs. Successful investing requires highly specialized knowledge, detailed analysis, and most of all, the patience of a saint.

Don't just take what you read on the Internet with a grain of salt. Understand that most of what you read is being written by people that want to sell you something. There is nothing fundamentally wrong with that. I have a website for that purpose too. But what is important is whether they are trying to give you the truth along with that magazine subscription or home study course---or just sell you the course alone by any means necessary.

MONEY Magazine should actually do a full issue where it does nothing but explain its bad investment calls. It would be about 7,000 pages long and that would just cover the last five years.

Robert J. Abalos, Esq.

MUST READ BOOK: The 1% Windfall by Rafi Mohammed

THE 1% WINDFALL by author Rafi Mohammed is by far the best book I have ever read on the subject of pricing products and services and how just a simple 1% increase in price can yield huge gains in operating profits.

While this book hardly mentions real estate at all, the importance of the author's analysis is so profound for rental property owners and investors it staggers the imagination.

Most real estate investors focus on "market" prices. What is the comp for that property? How much is a two-bedroom with 1 1/2 baths going for in a certain neighborhood?

As I have said many times, these are DUMB questions. Real estate investors can speak of "average" prices, but market prices are a whole other matter. This whole reasoning is beside the critical notion of intrinsic value, which is an investment valuation and not an accounting concept at all.

This book got my mind racing so fast on the subject of pricing in the area of real estate investment and development I may write an entire book on this subject.

In the meantime, this book by Rafi Mohammed is a great start. His analysis of pricing models is flawless and just plain brilliant. I can't recommend this book more highly to you. If you are a small business owner that sells a product or service you can put the ideas offered in this book to work immediately.

For the record, I do not know Mr. Mohammed or have any financial stake in the sales of his book. I'm recommending it to you because it is a must read book.

Robert J. Abalos, Esq.

Robert Kiyosaki Revises Licensing Agreement with Tigrent

Just ONE DAY after I wrote this blog post on March 18, 2010 criticizing his licensing relationship with real estate guru Russ Whitney's old company now called Tigrent, RICH DAD author Robert Kiyosaki and Tigrent have announced a new agreement designed to curtail marketing and sales abuses still occurring at the company.

Of course I had absolutely nothing to do with this. I was merely just another person in the crowd commenting on the obvious. Kiyosaki has a great reputation in the real estate and personal finance information business and Tigrent, or more accurately, Russ Whitney's notorious sales machine was hurting it.

I finally got to speak to a representative in Tigrent's investor relations department and they were extremely helpful in giving me some major in-depth information on the company and especially the new Kiyosaki agreement. I now understand why they didn't call me back before I wrote my original blog post on March 18th. They couldn't discuss what was in the works.

For the record, here is the official SEC 8-K release on the new Kiyosaki licensing deal.

I'm glad for Robert Kiyosaki. He gets some new assurance on customer service and marketing practices and also a block of stock in Tigrent. Not a bad deal---so long as it works. And I'm very sure me and lots of other people who remember the bad old days of Russ Whitney will be watching what happens next.

Tigrent needs to RUN AWAY and RUN AWAY FAST from its Russ Whitney legacy. Working with a well respected individual like Robert Kiyosaki is a great start. I wish him and the company the best of luck in this new direction.

Robert J. Abalos, Esq.