Tuesday, December 21, 2010

Bernanke Stimulus Plan Fails

As I have been predicting in this blog for more than a month now, Fed Chair Ben Bernanke's new stimulus plan, dubbed QEII, has failed to lower interest rates.  In fact, interest rates have RISEN, not fallen as Bernanke expected.

The reason is simple.  Devaluing the dollar raises inflation fears.  The increase in yield is the additional risk premium.

Even the lamestream media has begun reporting on Bernanke's missteps.  Read this apologetic gem from the Atlantic.

So let's see.  If the Fed buys bonds with newly printed money and interest rates rise, what will happen to interest rates if the Fed buys more bonds?  Ask a second grader this question and you will likely get the right answer.  Ask the Fed and they will have a novel theory that avoids reality, empiricism, common sense, and the truth.

The U.S. and world economy are not out of the woods yet.  The foundations of growth are more firm than they were in 2007.  But not by much.  The world economy including China is going to limp along for years, maybe even a decade.  Look at Japan and its now TWENTY YEAR deflationary cycle as an example.  Real estate values have fallen in Japan for NINETEEN straight years.  Read about their Lost Decade for an example of what will happen in the United States, just not as severe or as long.  There are many, many parallels.

Bernanke recently appeared on the CBS News program 60 Minutes and gave a nervous, sweaty, and tense performance that has lit up the blogosphere.  Here is one view of how poorly he did in front of the cameras answering questions about his actions at the Fed from 2005 to the present day.

Representative Ron Paul and his new chairmanship over the Fed is going to cause Mr. Bernanke many sleepless nights.  While I do not share all of Mr. Paul's views, he is more right than he is wrong about the Fed and its obscure and hidden accounting, its misconceived easy money policies (called the Greenspan and now Bernanke "puts") and the bizarre statements and laughable predictions made by Bernanke and his predecessors.  I welcome Mr. Paul's inquiries and suggestions for reform.

The Fed needs to end its pointless stimulus plans.

Tuesday, December 14, 2010

Metrodome Collapse

The footage of the roof collapse at the Hubert H. Humphrey Metrodome in Minneapolis is not just fun to watch but educational from a structural engineering and design perspective.  I see many academic case studies being written around this failure for years.

To get some background on the stadium itself, the Metrodome has an excellent website, including a comprehensive history of the building.

What happens next for this old stadium, the ninth oldest in the National Football League, is up in the air.  Maybe some stimulus money can be found to begin construction on a new facility?

Saturday, December 11, 2010

Seattle Signage Debate

The debate currently developing over signs on buildings, or more precisely VERY LARGE SIGNS on VERY LARGE BUILDINGS, is quite fascinating from a economics case study perspective because it cleanly splits the interests of the public at large from private owners in particular.  Both sides in this debate make compelling arguments on their side and against the other, making any public policy decisions in the legislature, the city council, or the courtroom extremely difficult.

Seattle is in the midst of such a debate now.  Should the city council allow developers and building owners to lease space to tenants and permit the names (but not the logos) of the lessees to be placed on their buildings?  And, once again, both sides are making great points.

A skyline of a city free of huge building topping signs and logos is more naturally beautiful than one filled with signage.  I will admit there are some classic big building signage, like the Citgo sign in Kenmore Square in Boston or the old PanAm sign that gave 200 Park Avenue in New York its name, that is memorable and historic.  Let's not forget the Hollywood sign in Los Angeles, originally an advertisement for a real estate development called Hollywoodland.  These cities would not be the same without these treasures.

But most signage is not attractive.  Some of it is downright ugly.  And too much signage makes a city look like a set in the movie BLADE RUNNER, blaring colors and visual noise, a futuristic nightmare for the eyes.

It is true, legally and morally, that the general public has an interest in a clean and uncluttered skyline.  It can certainly regulate the number of signs and the conditions of their use, exactly as a city controls the number of buildings that go up and how high they rise in the first place.  But can a city ban all signage, or so restrict its use there is an effective ban?

Developers and building owners obviously say no, and they also have a point.  It's THEIR building.  Leasing with signage rights makes attracting tenants easier.  Signs are advertising.  Why can't big corporations and major firms advertise their location like all other businesses?  Don't pizza parlors, used car dealers, and barber shops all put signs out front to attract business?

With real estate vacancy high, especially on Class A commercial properties, the very real estate that would attract Fortune 500 type tenants, restricting or banning signage makes some properties financially uncompetitive relative to those communities that are more liberal towards large signs.  No leases, no jobs.  Does a city really want to lose a major commercial tenant and hundreds of jobs over a sign?

Seattle needs to strike a balance and ultimately the city council will, in some fashion or another, after lots of angry and loud debate, which is part of our local tradition.  Lots of smoke from a relatively small fire.

I expect more signs on the Seattle skyline in the future but probably not as many as there should be.  Remember all those signs I listed above from Boston to LA only got to be famous historic landmarks because someone was first allowed many years ago to install them.

Thursday, December 9, 2010

Home Prices Fall $1.7 Trillion in 2010

U.S. home prices fell yet again in 2010, falling another $1.7 trillion in value.

Since the peak of the U.S. market in 2006, U.S. home prices have fallen a whopping $9 billion.

So, who is to blame for this debacle?

Wall Street, the greedy mortgage lenders, the insatiable real estate sales industry, even the get-rich-quick real estate gurus who promised instant wealth and long-term retirement security through real estate and Federal Reserve who made all that borrowing and leverage so easy and cheap.  What about the Federal and state governments that let all those abusives above happen?

Take your pick.  Or picks.

One person that can never be blamed for this mess is me.  I warned my readers for years that real estate prices were high, way too high.  I ranted and raved about the deteriorating mortgage underwriting process that was sweeping the nation, eroding the relationship between what a home costs and what it is REALLY worth.  I explained many many times that real estate prices, just like trees, cannot grow into the sky, not just with reason and rhetoric but numbers and examples before my eyes and in the press.

I'm not bragging, well maybe I am slightly, but I feel sad for my country, just like a failed Paul Revere.  I wasn't the only person who said that the real estate market was in a bubble about to pop, but it happened anyway.  I feel like I fell off my horse.

For the future going forward, there are few real catalysts stopping the real estate price slide anytime soon.  A stabilization or slow slide is more likely than more harsh shocks of the 2007-2008 era, but anything is possible because the United States and the world is now in uncharted waters, the so-called undiscovered country of economics and finance.  Never has the world been so broke before.  Every village, city, county, state, and Federal government are broke, crushed with debt and out of control costs.  For a great analysis on this point read this interview with Jim Rogers.  Most of Western Europe is already technically insolvent.  California looks like Greece.

$9 trillion is not just some numbers on a spreadsheet.  Most of that number is the wealth and savings of the American middle class, decades of investment gone in a flash, and the sad truth is that almost all of that money is never coming back.  Most of the jobs that were lost in the last recession are gone forever.  Life in American has and will profoundly change over the next generation, for better or worse, and right now I am not a betting man.

Sunday, December 5, 2010

China's Skyscrapers

Today, I have an assignment for you.

China is building skyscrapers, lots of them, including the world's tallest building.  Read this article before going on the next paragraph.

Then compare and contrast the above article with this classic essay, The Tall Office Building Artistically Considered, written in March 1896 by Louis H. Sullivan, the architect and creator of the modern skyscraper.

This is some of the most brilliant prose ever written, let alone on real estate development.

The implications for China, the United States, and the rest of the world are beyond comprehension.

Thursday, December 2, 2010

Major Get-Rich-Quick Creative Real Estate Guru Faces Mail Fraud Charges

According to law enforcement sources, a "serious" (their word) real estate guru will be facing a Federal mail fraud complant in the days ahead.

I am aware of multiple investigations against a number of creative real estate get-rich-quick gurus but want to confirm who is the target before I name them here.

More to follow.

Tuesday, November 30, 2010


Just two quick updates to two recent Seattle stories:

Turns out the homeless schizophrenic murderer of an innocent man with an axe which took place last Monday in downtown Seattle was the SECOND murder in two days for this street person.  Police now say he killed another man with his axe the previous day.  If anything this conclusion makes my call for a crackdown on the mobs of street people now crowding the avenues, parks, and alleys of Seattle more powerful.  Something major needs to be done----NOW.  By the way, the media is now reporting the innocent man carrying groceries home from the market who wound up with an axe buried in his head TWELVE TIMES was brutally murdered in front of a pack of school children waiting for a bus.

And it also turns out that Seattle Mayor Mike McGinn's proposed location for a PERMANENT homeless encampment (read that as "tent city") for 150 homeless men and women has a problem.  The site is contaminated with toxic waste.  Despite the fact the site is on a State of Washington cleanup list, the Mayor has claimed not knowing about the chemical contamination when he proposed the location.  Make you wonder who was doing the due diligence down at City Hall.

Welcome to Seattle.

Wednesday, November 24, 2010

Seattle Homeless Man Murders Stranger with Axe

I have been warning the City of Seattle in this blog for MONTHS that the so-called "homeless" problem is growing and getting worse.  To be blunt, it isn't the street people who need help.  It's the average working people and residents of the city who need protection from the growing throngs of mentally ill, drug addicted, and violent people who live on the city's streets and bring crime and mayhem with them.

This week brings clear evidence to a situation spiraling out of control.

On Monday afternoon in downtown Seattle, a 26-year old homeless man with a long history of violence, schizophrenia, and other mental disorders attacked and murdered a random stranger, a 58-year old man walking on a sidewalk.  For no reason and after no confrontation, the killer buried a pick-axe (the kind that mountain climbers use) into his victim's head TWELVE times.  Click on the link above and read the actual police report.  An innocent man walking on the street carrying groceries is killed for no reason by a mentally ill homeless man.  The murderer has been arrested many times before over violence but released so he could remain homeless on the streets of Seattle.

Just a day earlier than this murder, yet another homeless person stabbed a man multiple times while the victim was waiting for a bus.  Ironically, this is very near the spot where Seattle Mayor Mike McGinn wants to build a permanent homeless encampment for 150 men and within spitting distance of Seattle's football and baseball stadiums.

Back on Monday, the same day as the axe murder, yet another mentally ill Seattle man was killed by police for refusing to put down a handgun.  I hope these Seattle SWAT officers have better luck than the last officer involved in a deadly force incident.  In that case, a Seattle police officer shot and killed an alcoholic homeless man with a woodcarver's knife who refused orders to put it down.  This officer is now in the midst of a serious legal battle with not only the city but the Feds that have begun to look at the case for Federal civil rights violations.

I could mention how a mentally ill homeless man tried to kidnap a baby from a woman at a major Seattle city park last week too but why?  Just another reason for suburbanites to avoid the city like the plague.

The idea of letting THOUSANDS of drug addicts, alcoholics, mental patients, runaways, prostitutes, street criminals, drug dealers, and other assorted miscreants roam the city at will creating mayhem is a disgrace and a public safety nightmare.  This week brought us Seattle residents an attempted baby kidnapping, multiple stabbings, yet another police killing, and now the gruesome murder of an innocent man by an axe-wielding lunatic.

No wonder Seattle real estate prices continue to fall.  Common sense rules, eh?

Friday, November 19, 2010

General Motors Initial Public Offering

I have followed the General Motors IPO with great interest given my long history with the company.

The IPO price was way too high.  The Chinese government bought 1% of the company for $500 million and got a super sweet deal subsidized by U.S. taxpayers.  So even at this artificially low price, GM is worth $50 billion, just about what U.S. taxpayers have put into the company.

The IPO price was $33 and raised about $22 billion in total.

I think the price of GM common will be less than $10 a share in a year's time.  I'm not the only person who feels that way either.  Here is a United Auto Worker's union representative officially saying the same thing.

My sources on Wall Street and in Washington, D.C. tell me that this IPO was oversubscribed because of intense pressure from the Obama Administration which is eager to get back some of the $49.5 billion that U.S. taxpayers spent saving GM.  Treasury and the White House twisted arms and are now taking credit for the smooth IPO and the high volume of sales.

Is General Motors REALLY the stock of the future, the one you REALLY want to buy for your investment portfolio?  Do you know people eager to rush out and buy a new Buick or Cadillac because GM is now a public company again?  The company is riding on the success of the new Chevy Volt, the Green Car of the Year, praying that people will want to buy them.  I'm skeptical.  It's really just another hybrid with a whopping pricetag, but we will see.  I wish the sales force luck.

Given its vital ties to the UAW and organized labor in general, the Obama Administration had to do something politically to save GM.  It spent nearly $50 billion, just about the same price that the Chinese just paid.  I doubt the taxpayers of the United States are ever going to get their money back on this rescue.  The fate of GM would have been better decided by an experienced bankruptcy court judge rather than the U.S. Treasury but that is another story.

Tuesday, November 16, 2010

China Stops Real Estate Loans

I read with great interest on how China is attempting to prevent a real estate bubble (or at least quickly pop a small one) by restricting new loans for real estate development.

This is, of course, in contrast to Mr. Bernanke's new QE policy that is trying to stimulate another bubble into being with near zero interest rates and massive liquidity.

Interesting how both nations react to real estate bubbles, yes?

Friday, November 12, 2010

China's Instant Hotel

I read with great interest the recent impressive accomplishment of how the Chinese built a 15-story hotel in just six days.  This well produced video of the construction (incorrectly labeled in my opinion) is really fun to watch.

This super fast construction is an AMAZING accomplishment.  The people of Changsa and all the engineers, builders, and workers involved should be proud.  Pulling something like this off is an exceptional achievement.

The first thought I had when I read of this idea was how there might not be a real substantial market worldwide for "instant" hotels, but this engineering and construction techniques could be used in disaster situations to provide housing for refugees and displaced people.  Think post Hurricane Katrina or in Haiti  after the earthquake.  Forget about tent cities.  You literally could build real ones, block upon block, in just weeks.

This type of construction and development is not just green.  It's SUPER GREEN, environmentally friendly to the core.  Little waste.

Ladies and gentlemen, this is the future.  The Chinese have another gold mine on their hands.  Kudos.  My advice is find a way to invest with them in this model of development.

Wednesday, November 10, 2010

Bernanke Defends His Stimulus

Federal Reserve Chairman Ben Bernanke has been everywhere defending his recent $600 billion stimulus effort but the world is not buying what he is selling.

Virtually every major economic power in the world has condemned the idea of essentially printing money to finance U.S. debt obligations.  China, Japan, Russia, Brazil, India, Germany, and even Luxembourg have publicly expressed their reservations.  We can only imagine what they are saying PRIVATELY to Bernanke and, even more importantly, to each other.

As part of his charm offensive, Bernanke told students from Jacksonville University that his idea was "not inflationary" because it did not increase the total money supply.  Even his audience did not believe him.

With this decision, Mr. Bernanke has crossed the Rubicon, an economic point of no return.  He may claim that QE II, his nickname for his new scheme, is limited but we know that QE III, IV, V, and XXVIII are on the way.  Read this analysis on how our Fed is complicating the foreign policy of the United States.

It's far too easy to monetize debt.  Think if you could pay off your mortgage and credit card bills with money freshly printed in your basement.  You think China holds far too much in U.S. credit obligations?  Just make them worth less by devaluing the dollar.  Want to give people Social Security benefit and pension payment increases but not really pay for them?  Just monetize the obligation.  You just give them a dollar worth 94 cents.

Mr. Bernanke's Orwellian doublespeak makes no sense to virtually everyone, foreign and domestic.  The problem with the U.S. economy is not a lack of liquidity or high interest rates.  It's uncertainty over taxes, regulation, and the future of the country.  Jimmy Carter's state of malaise has returned.  $600 billion more is not going to drive interest rates lower or add much to national spending.  This policy only angers our allies at the very time where the world economy is fragile and everyone needs to cooperate.  Mr. Bernanke's "novel" action (as he called it) only makes people less sure about the U.S. economy.  Why throw the Hail Mary pass at this time, right now?  What does the Fed know and isn't telling?

Inflation is not a friend of real estate investors and Bernanke's plan is risking hyperinflation.  You do the math.  Inflation is great if you are a borrower but awful if you hold cash.  If anything, QE II encourages spending over investment and short-term thinking over long-term planning.  Bernanke says the Fed can withdraw liquidity at precisely the right time to prevent inflation.  HUH???  Remember this is the very same Bernanke that just days before he was nominated by President Bush to be Fed Chairman testified before Congress there was no real estate bubble and none would ever pop.

That was on October 27, 2005.  Read his comments and how ridiculously wrong he was.  Sorry, I don't trust his judgment anymore.

Tuesday, November 9, 2010

Seattle Announces Permanent Homeless Encampment Site

Seattle Mayor Mike McGinn (that's him in the picture) has announced he wants to put a PERMANENT homeless tent encampment in the SODO district of Seattle, the place most people around the country know as the home of the Seattle Mariner and Seahawks.  See those big stadiums at our home games?  Qwest and Safeco Fields?  That's SODO.

The Mayor's preferred location for this permanent 150 person tent city is known to locals as the site of the old Sunny Jim peanut butter factory, a long abandoned building that, ironically, was burned to the ground just two months ago by a homeless man with a camping stove.  The mayor proposes spending $220,000 to clear the city-owned land and put in some basic amenities like a meal house and plumbing.

Of course none of the residents or businesses in the area want upwards of 150 homeless men and women camping out in their neighborhood.  The objections are obvious.  Yes, there is some NIMBY here but the real objection is that this site is PERMANENT.  Neighbors do not want even temporary encampments.  Read an excellent analysis of what Seattle's current shelters are like here.  Despite all the politically correct hype, these tent cities are just what you think they are.

But there is strong logic in the Mayor's choice of location.  I love site analysis and this location makes for a great case study in real estate master planning.

The proposed site is isolated.  Unlike many of the other proposed locations on the Mayor's shortlist, this one is not in a populated area.  The location is zoned industrial, with many warehouses, dealerships, metal shops, and such.  There are many fewer neighbors to upset with your choice of location.  Plus you would think the most jobs available would be in the city's most industrial area.

The site is on a major highway with ample public transportation in every direction.  Some of the other locations, like in West Seattle, were isolated.  If you don't own a car, you couldn't ask for a more central location to catch a bus or train.

The current site is a burned out shell building.  Something has to go there and the city owns the lot.

The problem isn't with the location, it's with the idea of a permanent tent city.

I have lived in downtown Seattle for more than six years and the city's homeless population is simply out of control.  The simple fact the city does not address in its housing solution is that most of Seattle's transients are not from Seattle.  They are from every place BUT Seattle.  The city is filled with transients, runaways, prostitutes, alcoholics, mental patients, and assorted street criminals from every city in Washington State, plus Oregon, California, Idaho, Montana, and Colorado.  New numbers just flood in given the permissive and ultra-liberal culture and politics of the Mayor's office. 

The City of Seattle could build a 1,000 tent encampment and it would be overwhelmed with numbers in a month.

In my mind there is a huge difference between helping someone get off the streets and enabling a person to keep living there.  Providing indoor beds is preferable to tent cities in the winter.  The idea of a permanent squatters camp or whatever you want to call it is not only futile but damaging.  It injures the reputation of a city.  There are better options that make more sense.

Please think about this, Mr. McGinn.

Friday, November 5, 2010

Fremont Bridge Seattle

The Fremont Bridge in Seattle is one of the city's most well known landmarks.

It is also one of the city's biggest headaches for motorists, pedestrians, and bicyclists.

Built in 1917, this drawbridge is the busiest one in the United States and one of the most busy in the entire world, going up and down more than THIRTY FIVE times a day. Given the fact that the bridge does not operate during rush hours or much at night, the span has to be raised and lowered sometimes two or three times per hour. Often the boat traffic under the bridge is a single yacht or sailboat.

The video I took and put up on YouTube is a real time illustration of how long the average wait is for the bridge to go up and down. On this day I was out of a car and walking around so I could take in the view, which I will admit is extraordinary. But at over SEVEN MINUTES you get a sense of how annoying and boring the wait at the bridge can be when you are in a hurry and there is no other way over the Fremont Cut to Lake Union.

I love historic properties and the Fremont Bridge is on the National Register of Historic Places and is also a city landmark and personally, it is very cool to watch the mechanisms of the bridge work. By the way, those gears and motors have to be maintained and replaced from time to time, costing $41 million the last time they were overhauled in 2006. A great deal of money for an antique toy.

The real estate implications here for me are obvious. How many business deals, condo purchases, and other transactions were aborted by people stuck in traffic at the Fremont Bridge? I love the quirky charm of Fremont, an artsy part of Seattle known mostly for its giant bronze statue of Vladimir Lenin which sets the spirit of the neighborhood which calls itself "The Center of the Universe."  But I would not want to live or work there because of the daily inconvenience of this bridge. There is just no other realistic way of getting around it and over it sometimes takes awhile as my video shows.

The policy question here is obvious. Does a modern city really want its neighborhoods connected by a century old relic no matter how charming it truly is?

The bridge is going nowhere. I would probably protest myself if the the city wanted to remove it. But the simple question remains. Isn't there a better way to cross a 502 feet wide ditch filled with water?

Wednesday, November 3, 2010

Election Night Results

Of all the commentary, prognostications, analysis, speechmaking, and sundry verbiage, the best words of last night came from the new Senator-Elect Rand Paul from the Great State of Kentucky.

His victory speech was eloquent and earthshaking.  The status quo in Washington is dead, and perhaps Big Government has been mortally wounded.

I wish Mr. Paul and all the new Republicans much success in the days ahead.  They will need all the fortitude and courage they can muster because the Old Guard is still in charge and like the dinosaurs they are these blind behemoths are unaware of how little people get crushed in their wake.

Today, Federal Reserve Chairman Ben Bernanke announced the Fed will start buying $75 billion of long-term U.S. debt PER MONTH until June 2011 for a total of $600 billion.  Even the mainstream media has realized this is a disastrous policy.

But also notice when, on what day, or more precisely after what day, does Bernanke announce it.

Tuesday, November 2, 2010

Helicopter Ben Bernanke

Critics of Federal Reserve Chairman Ben Bernanke (like me) offer refer to him as "Helicopter" Ben.

Here's why.

Read his speech before the National Economists Club on November 21, 2002 and why he got the nickname.

This speech is even more relevant today than it was almost ten years ago.  The subject of his talk was deflation and even today Bernanke is fighting the wrong paper dragon.  He's risking hyperinflation through his extremely easy money policies while losing sleep over deflating asset values which rose to extreme and unsustainable levels in the first place.  In other words, the current situation is more a market correction in asset values rather than a classic monetary deflation.

His speech is filled with choice gems of illogic.  Here's a great one widely quoted:

What has this got to do with monetary policy? Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.  (emphasis added)

So where does the "Helicopter" idea come from?

It actually comes from Milton Friedman who joked that the U.S. government could solve deflation by just throwing cash out of a helicopter.  Friedman ridiculed this idea.  Bernanke in his speech embraced the very notion of curing deflation by simply printing more money.

Ben Bernanke is a nice man, I'm sure.  But he is one of the most incompetent Fed Chairman in the history of the Fed, a truly profound statement given the assorted parade of hacks and bozos that have occupied the office since 1913.  Don't believe me.  Read his speech.

Monday, November 1, 2010

Personal Income Falls

U.S. personal income fell once again in September, which seemed to come as a huge shock for the legions of EMPLOYED government economists in Washington, something that is no surprise at all for the full 20% of the U.S. population that is either unemployed or struggling with part time work that does not pay all the bills.

Every segment of the U.S. population is suffering through this tepid recovery, the worst since the Great Depression.  Take, for example, recent college graduates who are looking for their first real jobs in the worst employment market since 1993.

Of course, U.S. personal income is falling.  And it will continue to fall, or rise without consequence, until the U.S. GDP growth rate exceeds 5%.  What is the current growth rate?  Last quarter it was a dismal 1.7% which is not enough to cover even new college graduates and immigrants let alone the TENS OF MILLIONS still seeking employment.

To make matters worse, the U.S. real estate market, normally an engine of GDP growth, is actually now working as a brake on it, draining away resources and retarding growth.

There will be no increases in residential rents in the United States until personal income rises and rises strongly.  Same is true about property values.  Home prices are still falling in most markets and will continue to do so until people (1) have full time jobs; (2) that are reliable; (3) their personal income is rising; and (4) they feel confident enough again to buy properties for personal use and investment.

This isn't going to happen anytime before 2013.  I have predicted this in this blog before.  And even this date is unsure given the bizarre and dangerous rumblings out of Washington.  For example, Fed Chairman Ben Bernanke is going to begin yet another $500 billion or so charge against the Fed's balance sheet this week when he starts buying bonds to "stimulate" the economy, move that even The New York Times is questioning as not the greatest idea.

Given Helicopter Ben's track record, a housing price rebound in 2014 may become optimistic.

Saturday, October 30, 2010

Foreclosure Moratorium

I have been reading with great interest about all the foreclosure moratoriums, Robodoc signings, missing paperwork, and all the rest being discussed with such melodrama in the mainstream media.

I haven't commented on any of it because none of it is worth discussing.

Politicians will make calls for a foreclosure moratorium in an election year much like they kiss babies and shake hands.  No news here, especially when the foreclosure rate is continuing to grow in 133 of 206 U.S. metropolitan areas.  Vice-President Biden's "Recovery Summer" hasn't exactly worked out like he planned.

People facing foreclosure are desperate and searching for options, any options.  Claiming paperwork errors is a common delaying tactic in all legal proceedings.  It works in foreclosures too.

But in the end there will no national foreclosure moratorium.  Notice how quickly even Mr. Obama ran away from the subject.  The major lenders will tighten up their paperwork filings and continue to process them.  People might gain a month here or a week there by arguing faulty signatures or missing note originals but none of this works in the long-term.

If you agreed to make a monthly mortgage payment and didn't, you can't keep your home because your lender during the foreclosure proceeding failed to sign the proper affidavit in the correct way.

This entire debate has been a snooze.  I'm going back to sleep.

Wednesday, October 27, 2010

Pike Place Market Murder

Yesterday, one block from Pike Place Market and the image to the left, a man was shot to death in the middle of the afternoon, 4:40PM, just as tens of thousands of office workers were headed home.

The sidewalks at the time of the murder yesterday were crowded, filled with people waiting for buses, walking, shopping.

One man just one single block from the largest tourist site in Seattle walked up to another man after an altercation and shot him in the head three times.  The killer then walked one block to restaurant where he, strangely, ordered a plate of French fries and was arrested.

The murderer was under court ordered supervision yesterday, out of prison for little over a year on multiple felony charges including burglary and assault.  So far the media has not asked the simple question "Why was this supervised felon carrying a handgun?"

The victim was a career criminal too who had been arrested THIRTY-NINE times since 1997.  He had just been released from jail on drug charges in August after his rape convictions had been overturned on appeal.

This murder was the second killing with a handgun of the week.  On Saturday another man was shot to death by another career criminal with a long history of felony convictions who, ironically, actually been arrested at the very same intersection of the murder earlier this year with a stolen handgun.

When will Seattle wake up to its growing problem of violence?  And who is causing it?  And why are these career criminals, psychotics, and drug addicts roaming the streets with illegal guns?

It is just a matter of time until a tourist is murdered near Pike Place Market or the Space Needle.  It is only sheer luck that someone was not shot or killed yesterday by a stray bullet.  Then the hotels and the restaurants and the businesses that live off the tourist trade can suffer because the city is playing nice with rapists, drug dealers, convicted murderers, and other assorted sociopaths.

By the way, the murder yesterday took place at the intersection of Second Avenue and Pike Street in downtown Seattle.  I have mentioned that location before in this blog.

It is where the retail chain Target is going to build its first urban store, a decision announced with great fanfare earlier this summer.  I predicted the placement was going to be a disaster for the company then and I'm standing by that assessment with even more confidence after the grisly events of yesterday.

Tuesday, October 26, 2010

Seattle Homeless Encampment

The City of Seattle has made it known it wants to build a PERMANENT encampment for homeless men and women on city property and open up city parks and other public buildings for use as shelters.

Would you like to live next to such a place or have a business across the street from a tent city of homeless men and women?  Ask the residents who have lived near "Nickelsville", Seattle's roaming tent city for the homeless named after the former mayor who attempted to actually enforce trespassing laws on city property.

The decision to find a PERMANENT site for the homeless camp is called "controversial" by government leaders.  REALLY?  I urge any person to visit any city park in Seattle today and see what conditions are like.  Take in the sights of drunks and drug addicts passed out in the middle of the day, sleeping on the grass.  Enjoy the smells of people who defecate on themselves and do not bathe for days and weeks at a time.  Be sure to do all this during daylight hours because at night you risk your life just walking down the street near the park.

What will be the end result if this madness becomes reality and a permanent site is found for homeless men and women to pitch tents, cook meals, and otherwise build a community?

Angry residents.  LOTS OF ANGRY RESIDENTS.

A tent city built for 100 people will soon have 300 and calls will be made for a larger space on more city land.

Property values for the legitimate residents of the area that actually bought homes there will decline.

Crime will increase in the area.

There will be more vagrants, drug addicts, unregistered sex offenders, prostitutes, unmedicated mental patients, and other "homeless" people flocking to Seattle since the word on the street, like Groucho's secret word, is "permissive."

The problem is this situation is not homelessness.  There are many people who literally have fallen on hard times and need help.  However, these are NOT the residents of Nickelsville.  The professional homeless political class that resides there take pride in their homelessness, rather than taking positive steps to end it.

If the City of Seattle really wants to tackle the problem of homelessness and all the lawlessness it causes on its streets, it needs to do two things:

1.  Enforce vagrancy and trespassing laws that will discourage runaways, transients, drunks, addicts, and others from flocking to Seattle in the first place;

2.  Target the available public services to those people who actually need real help, who want to change their lives and get off the streets, not feed and house petty street criminals who have decided to live as permanent parasites on society.

The urban problem of homelessness is insatiable.  You could devote the entire GDP of the United States to the problem and in the end you would have more homeless than ever before.

As Ronald Reagan so accurately put it years ago:

"We fought a war on poverty in the 1960s.  Poverty won."

Monday, October 25, 2010

The Fires by Joe Flood

The Fires: How a Computer Formula, Big Ideas, and the Best of Intentions Burned Down New York City-and Determined the Future of Cities by author Joe Flood is another MUST READ book for all real estate investors.

This exciting and exhaustively researched book tells the story of how much of New York City literally burned to the ground in the late 1960s and early 1970s because of policy making decisions made by then New York Mayor John Lindsay and the New York Fire Department.  While their intentions were good, they turned over much of their manpower assessment decisions to a computer system designed by the RAND Corporation, at the time one of the world's most respected think tanks.

The result, as author Joe Flood makes perfectly clear, was a disaster.

More than 2,000 people in New York City were killed.

Hundreds of thousands lost their homes.

Whole sections of New York, from the South Bronx, the Lower East Side, Harlem, and Brooklyn, went up in flames not because there were too few firefighters but because a computer system had them put in the wrong locations.

Real estate investors all across America need to read this book.  In an era of municipal budget cuts that will chop away at not just the fiscal fat but into real muscle as well, it is easy to see this same process replicated again in cities all across the United States as governments attempt to save money by using private consultants and their computer wizardry to create economic efficiencies.

There are no real villains in The Fires.  There are two mayors, an ambitious fire commissioner, and an assorted cast of consultants who have nothing but the best of intentions at the start but end with an epic catastrophe on their hands.

As a real estate investor you had better know who is assigning municipal protections to your neighborhoods and how they are doing it.  If you assume your local government is doing this correctly, you are naive.

The Fires by Joe Flood is a strong lesson as to what happens when government looks to technology for answers and only creates far worse problems for ordinary citizens.

Sunday, October 24, 2010

FTC v. John Stefanchik

For those who don't remember him, John Stefanchik was an 1990s-era get rich quick in real estate guru who pitched a book and home study course telling people they could make a fortune in real estate paper.

His Wealth Without Boundaries program promised you could "make $10,000 every thirty days---guaranteed."

Well, as you guessed, buyers of his course soon learned that there were no magic pots of cash available to be harvested monthly.  Stefanchik got rich selling his course.  His students got poorer.

Ultimately, the FTC got a $17 million judgement against Stefanchik and his operation has been shut down.  The Stefanchik Method: Earn $10,000 a Month for the Rest of Your Life-In Your Spare Time is now being sold on Amazon for just 32 cents.

What is important these days is not the name or the lesson of John Stefanchik.  There are a legion of get-rich-quick real estate gurus who make John look like a petty amateur when it comes to making phony claims about their products.  And of course the get-rich-quick schemers go far beyond just real estate offerings.  Check out the doozy in the ad above.  Make almost $1,000 per day working at home on Twitter????

What really is important these days is the case of Federal Trade Commission v. John Stefanchik, 559 F. 3rd. 924 (2009) where the FTC's methods used to evaluate guru course promises was called into question by Stefanchik on appeal.

He lost, and multiple official sources within the FTC tell me there is a host of new enforcement cases coming through the pipeline based on the FTC's methodology in that case.

This is excellent news because the FTC's approach in Stefanchik was dead on perfect.  The claims made during the last real estate bubble by flipping property "experts" alone would fill an encyclopedia of the absurd and ridiculous.

Thursday, October 21, 2010

Government Owned Real Estate Selloff

Want to make a quick killing in real estate?  Here's a trick that actually does work.  But you will need a lot of cash and some good government connections to pull it off.  Both are doable, but tough.

The government at all levels is broke.  The Feds, the states, and even your local city and county needs cash to pay usually absurd levels of fixed operating expenses like salaries and pensions.

So now there is a huge selloff in government owned real estate.  Everything from parking garages to baseball fields to prisons to rivers and lakes.  If the government owns it, it is likely for sale.  The government is also picking up many properties through forced sales, foreclosures, tax sales, and other creditor proceedings.

Today some real estate investors just bought the Orange County (California) fairgrounds.  Check out the sweet deal they got.  Even some of the local pols realize how sweet it was and objected.  Read this excellent article from the O.C. on who these local investors are and how they put this deal together.  Fascinating stuff.  This is a truly spectacular piece of real estate.  Impossible to recreate at any price.  The map above shows how large this parcel is and how many separate cash flows it has all on a rather undeveloped piece of land.

Wherever you are, some government is likely selling or attempting to sell a piece of your neighborhood.

The deals will be excellent for shrewd investors.  The government is motivated, very very motivated, and needs cash fast.  The properties they hold are often local gems, irreplaceable.  And the financing offered including tax abatements, low interest loans, and other incentives are unique to dealing with a government entity.  No private party can waive taxes, for example.

There are many ways to play this trend, a subject I will address further in future articles.

Wednesday, October 20, 2010

Bernanke Wants Inflation

Here is what the Washington Post says about Helicopter Ben Bernanke's new scheme to inject inflation into the moribund U.S. economy.

Of course his new plan is madness, but who is going to stop him?

When you have a Fed Chairman acting like a desperate teenage girl trying to find a last minute date to the prom, you have a national economy in crisis.

Which, of course, we do.

His new $1 trillion scheme will have profound implications for the U.S. dollar, oil prices, and the world economy as a whole.  Forget what I say Bernanke's latest dunderhead program.  Here is what The Wall Street Journal says and they are right.

I have been calling for this fool to be fired for more than three years now in this blog.

It's only a matter of time before the mainstream press starts to agree with me.  Even they are starting to get it, and that's not a good thing.

Thursday, October 14, 2010

Robert Abalos Saves Homebuyer $350,000

Here is an email received from Phoenix, Arizona.  It is unedited and published with the consent of the writer.

Mr. Abalos:

My husband and I wanted to thank you for your advice on our recent house purchase and remodel.  According to the estimates we have now you saved us about $350,000.  We would have borrowed much more to buy our home and dip into our savings to do it.

We can't thank you enough.  God bless you.

Pablo and Maria Espinoza

And what was my advice to this lovely couple?

1.  Don't buy more home than you can afford.
2.  A home is not an investment.  It is a place to live, not an asset that puts money in your pocket every month.
3.  Don't put high end amenities in a low end, bread-and-butter home.

Simple advice.  Very effective.

Tuesday, October 12, 2010

Seattle Crime Wave Continues

Just some updates on how life is REALLY in the Emerald City, or what has happened since the Friday and Saturday night rain of gunfire three days ago in downtown Seattle

Accused rapist charged in sexual assault

A serial rapist under suspicion and arrest for two serious and violent rapes attacks yet another woman in a great neighborhood, Ballard.  Very upscale and trendy.  Great nightlife.  Why is this guy walking the streets of the city?

Woman runner attacked with knife in city park

A 55-year old woman jogging in one of the most beautiful parks in Seattle was assaulted by a 18-year old unknown male with a knife and thrown to the ground.  Luckily she fought back.

Man sprays bar bouncer with Bear mace

Some angry man attacks the bouncers at one of Seattle's most popular nightclubs with a can of Bear mace after he is ejected from the club.

The Monday Morning Burglary Report

A wonderful interactive map where you can track where criminals targeted people's homes and businesses.  The map only represents 48-hours over a weekend and only burglaries that were reported.

I could go on but what's the point?

Seattle residents are fleeing the downtown core for other urban locations like Georgetown and Northgate, and also making suburban cities like Kent and Bothell very happy.

The effect on rents and property values downtown is obvious.

Crime affects property values.  If this is the problem, then the solution is also obvious.

Monday, October 11, 2010

Green Roofs in Sustainable Landscape Design

I don't often read a real estate book that is just about perfect.  I read pretty much everything new that comes out or reaches my neighborhood library and bookstores.  Most of what I read is really just rehashes of what has been said ten million times before, putting old wine into new bottles.  It takes a real punch to knock me out on a new real estate book.

I just bought and read a simply incredible one by author Steven L. Cantor titled Green Roofs in Sustainable Landscape Design.  This book just blew me away.

It's beautiful, almost a coffee table book, filled with gorgeous color photography pressed on glossy paper.  The subject matter is covered in microscopic detail with hundreds of examples.  This book is the definitive treatment any person who wants to use green roofs as part of a landscape MUST MUST MUST have.

I cannot recommend this book enough.  It's just inspirational to read.  You want to go out and build green roofs.  And why not?  They are functional, beautiful, environmentally friendly, and people love them.

Sunday, October 10, 2010

Yet Another Downtown Seattle Shooting

For months now I have been writing about the increasing violence and crime in the downtown core of Seattle which is where I live.  It is also the same neighborhood where the fictional Frasier Crane lived, and where all the tourist places that define Seattle are, such as the Space Needle and Pike Place Market.

This is also the same part of town where all the major hotels are located, that houses the Washington State Convention Center, the city's theater district, the city's music and nightclub district, and where 90% of the tourists who visit Seattle on business or pleasure stay and/or party.

The fact that a popular tavern betting game now jokes about the number of shootings, murders, and other mayhem that will occur each weekend, with the winner guessing the closest without going over, sort of like on The Price is Right, illustrates how shocking it all can be for residents.

This weekend, last night in fact, there was an ambush of a car at one of the most important street intersections of the city, First Avenue and Denny Way, where a car was sprayed with a hail of bullets just when the numerous bars and nightclubs in the area where getting ready to close.

Eight shots fired.

Two men hospitalized.

One critical.

There are a dozen condo and apartment buildings around this building.  Would you want the job of selling or leasing real estate in any of them tomorrow morning?  Read what RESIDENTS of the area, people who have already had the (mis)fortune to live near 1st and Denny say about the shooting and what they feel about the sheer number of them.  The website where these comments are posted, by the way, is SeattleCrime.com which chronicles all the deterioration one assault and battery at a time.

It is a disgrace such a website is even necessary.

Oh I forgot to mention.  The night before there was yet another shooting, just about seven blocks away, and four blocks from Pike Place Market.  Again, this gunfire was in no isolated area but in the center of the city's nightclub district where lots of tourists and residents spend their money and weekends.

This time two men were arrested when police responded to reports of gunfire at the intersection of First Avenue (again) and Bell.

Real estate is LOCAL, and it is mostly about LOCATION, LOCATION, LOCATION, so it would make sense that people do not want to live or pay top dollar to live near urban battlefields filled with psychos and drug addicts who have firefights in the streets.

Saturday, October 9, 2010

Bad Condo Development

Residents of downtown Seattle know the familiar site of the half demolished ruin of the Alfaretta Apartments at the corner of Seneca and 8th Avenue.  I walked by the other day and shot this video.

A former 60-unit apartment building, the site was being cleared for a 294-unit, two tower condo development called Seneca Towers to be constructed by Levin Menzies and his company Laconia Development LLC, a well known builder in Seattle and on the west coast of the United States.  In other words, he's no slouch.

But the eyesore ruin of the Alfaretta has been standing, sort of, for more than three years now at the corner of one of the city's premier development locations.  The remains of the Alfaretta is a magnet for drug dealers, vagrants looking for a place to camp out for the night, and other criminal elements that aren't going to be deterred by a chain link fence that does not even circle the entire site.

I've been around construction and demolition sites for thirty years and I've never seen anything like this before.  The building was being torn down and then...POOF...all worked seemed to stop, as if the five o'clock whistle blew and the workers never returned to the site.

Plus, why demolish a building until you actually need to clear the site?  The condo market in Seattle stalled in 2007, like it did everywhere in America, so Menzies can't be blamed for delaying his project.

But one of the most basic rules of real estate development is you DON'T CLEAR A SITE UNTIL YOU ABSOLUTELY NEED TO CLEAR IT.

This example proves the point why you don't clear sites prematurely, Menzies has lost three years of rent from an apartment building that was fully leased up (despite many tenant problems, read this) and has had to carry the costs of this prime land himself and also deal with the ridicule of producing one of the ugliest urban ruins in the United States.  Plus it is a stain on his otherwise decent reputation.  Who wants to own such a mess and have everyone publicly discuss it?

The Alfaretta Apartments, an old Seattle building from pre-World War II, had outlived its days and its meeting with the wrecking ball was inevitable.

But there it still stands today, mostly anyway, and residents and visitors consistently ask themselves the obvious question when seeing this near Roman relic in downtown Seattle---


Friday, October 8, 2010

Downtown Seattle Serial Rapist Sentenced

Home sales in King County, Washington (where Seattle is) are DOWN for the third straight month, a whopping 28% drop in September 2010 over the same dismal month in the previous year.

Why do you ask?  King County has a lower than national average unemployment rate of 8.6% and a solid and diverse economy.  If money isn't a large factor (it sure is a small one) than why the dramatic drop in home sales and the stagnation in the market?

To paraphrase James Carville, it's the livability stupid.  People are SICK of the street crime, vagrancy, drug dealing, prostitution, and assorted indignities of life in Seattle.  Our public parks in Seattle have become campgrounds and toilets for alcoholics and drug addicts, and the alleys of our streets are bathrooms and bedrooms for junkies and prostitutes.  Your car is not safe to park on the street, and you can't walk two blocks without being intercepted by a panhandler.  The center of prostitution for all of Washington State is a strip of streets called "The Track" that is literally at the base of Seattle's Space Needle where you can see 15-year old girls turning tricks to feed drug habits.

Want to pay $500,000 for a condo to live here?  Or $800,000 for a four bedroom house?

There are so many homeless men and women living in downtown Seattle that a serial rapist ONLY TARGETING HOMELESS WOMEN was sentenced today.  He was raping women in the Soda neighborhood of Seattle which is exactly where the Seattle Mariners and Seattle Seahawks have their stadiums.  He is known to have attacked four women but probably many more.

The City of Seattle needs to WAKE UP and start addressing REAL citizen concerns and not politically correct nonsense like bike boxes and green energy initiatives.

What makes infill development and gentrification work are low crime rates.

What you have in Seattle and the surrounding communities is growing crime and urban decay.

People are increasingly sick of it and just don't want to buy homes in such a place.  It's that simple.

Thursday, October 7, 2010

Obama Vetoes Foreclosure Bill

President Obama (pocket) vetoed a bill today that would have speeded up the foreclosure process for banks and law firms struggling under the weight of hundreds of thousands of forced sale proceedings.  The bill itself is rather simple, allowing for the out-of-state recognition of notarized documents, but the veto sure wasn't.

Of course, it is a political election year act.

Yes, there have been "improper acts" by lenders who rush through proceedings without dotting every I and crossing every T.  Some of the sales themselves have been fraudulent, of this I am very sure.

But the act is NECESSARY.  No one believes that the foreclosure process is without economic pain, especially for the homeowner losing their place to live.  But the act is NECESSARY to get properties out of the hands of people that cannot afford them or made extremely bad choices in the first place buying them.

It's hard not to be sympathetic towards mortgagors in foreclosure.  But keeping them in homes they cannot afford is tantamount to giving many irresponsible buyers a free pass at home ownership at the expense of those who played by the rules, bought reasonable properties at decent prices, and sacrificed to make large down payments.  The issue isn't the property itself, it is the people who wanted it without being reasonable or prudent.

The bill Mr. Obama vetoed was NECESSARY.  All the political grandstanding and electioneering just means the U.S. residential real estate crisis will linger, lasting longer and digging deeper than it should have in the first place.  Freezing foreclosures will simply freeze the problem in place instead of letting the system play out, however cruel that sometimes can be.

What Mr. Obama's pocket veto today really demonstrates is not how his administration cares about homeowners in foreclosure but how inept the U.S. Congress has become. The world's most distinguished deliberative body is passing bills without even knowing the consequences of their actions---and then leaving town to campaign for reelection which, of course, most do not deserve.

Wednesday, October 6, 2010

Redfin: Great Idea, Not-So-Great Execution

I'm a huge fan of Redfin, the Seattle-based online brokerage company, not so much because they are local to my home city but because their business model is unique and necessary.

Anything that shakes up the competition so strongly that competitors threaten "to break their (Redfin's) kneecaps" is a good for the real estate sales industry which has not caught up with the times.  The basic brokerage business model is caught in the 1950s.  Fixed sales commissions?  That idea went out the window with respect to stock sales in the 1970s but it lingers in the real estate markets putting a major damper on sales and inventory turnover.

So Redfin is fresh and what they are trying to do great.

Then what's the problem?

Simply put, they have a lot of IDIOTS working within the company.

There have been many layoffs at Redfin as you can imagine given the real estate recession.  Unfortunately I feel that the company has been cutting muscle and not fat.  While Redfin is filled with great representatives and executives, I have met more than a few that are arrogant and just plain dumb.  I had a confrontation with one moron in their marketing department this morning who was so obnoxious and ignorant that I'm taking my complaints to senior management, including one of Redfin's major investors, Vulcan Ventures, the capital arm of Microsoft's Paul Allen.

This RETARD, who does not even know the company's own policies or how they are enforced, needs to be severely reprimanded or fired.  Either would suit me as a start to cleaning house on a superb company that needs some quick changes.

I want Redfin to succeed.  I'm a fan.  They have a great concept, a necessary one.  But the company has far too many bad apples who don't properly represent the firm, its core message, or even know the company's own business practices.  Some minor tinkering would make a great company even greater.

Tuesday, October 5, 2010

Bernanke Warns U.S. Deficit is Unsustainable But No One is Listening

Fed Chairman Helicopter Ben Bernanke is now publicly warning that the U.S. budget deficit is "unsustainable" and that there is no reason to expect the U.S. economy to grow out of its fiscal mess anytime soon.

This is wonderful news.  Except that no one, not even his own Fed members, are listening to him.

For example, President of the Chicago Fed Charles Evans is now arguing for, and I quote, "much more easing" and "much more accommodation than we currently have in place."

Does anyone, ANYONE, really believe more bond repurchases are going to spur U.S. economic growth when TRILLIONS of dollars of fiscal stimulus has already failed?

The financial markets ignore Bernanke because he has NO credibility left on the subject of monetary policy.  Congress ignores him on the deficit because he merely accommodates their spending.  Why reform the budget or make unpopular spending cuts when Bernanke and his Fed will just create new money on demand?

It's nice to hear Mr. Bernanke finally agreeing with me on the deficit.  I have only been arguing against excessive Federal spending for, um, like THIRTY YEARS now.  I'm happy he has found religion, better late than never I guess.

But Helicopter Ben reminds me in many ways of former U.S. Senator William Alden Smith, who was one of the Congressional investigators looking into the sinking of the Titanic.  Senator Smith (that's him in the picture above) will forever be remembered for the many truly dumb questions he asked during this inquiry.  A well intentioned and educated man, he was just out of his depth when trying to investigate the sinking of an ocean liner in the middle of the Atlantic.

This is typical of the questions he asked during the investigation:

"If the Titanic had watertight compartments, why didn't the passengers of the ship take shelter there and await rescue?"

See the parallels?

Saturday, October 2, 2010

Whatever Happened to Mike and Irene Milin?

UPDATED:  Readers of this blog post flooded me with information about the Milins.  Click here to read the updated article about the Milins.

Mike and Irene Milin, the "dynamic duo" of get-rich-quick real estate gurus, were familiar faces on late night infomercial TV for years.  Starting in the late 1980s and until about three years ago I saw them pitching home study courses and other products pretty much everywhere.  While their usual real estate offerings were what you would expect (find distressed buyers, improve the property, etc.) their last sales pitches dealt with making money through government auctions.  (Another dead-end business if every there was one.  Read this article that discusses the Milins and their government auction course.)

But today, I can't find any new information on either Mike or Irene Milin.  Their last website, www.nationalgrants.com is off the Internet.  No one I know has news on either of them.  Google searches for the couple are a dry hole yielding nothing.

I never had a high regard for their books or home study offerings.  Their best book, which is not saying much, is How to Buy and Manage Rental Properties: The Milin Method of Real Estate Management for the Small Investor, and contains all the same advice you can read in about 25,000 other books on rental property management.  This does not make this book bad.  It just means it is nothing special and not unique or memorable in any way.

What really soured me on the Milins was their constant hype about their lifestyle, their airplanes, boats, trips, and luxury everything.  Here is a website describing their home.  All this silence and quiet from the couple makes me wonder what happened to them---and why.

Thursday, September 30, 2010

Waterfall Garden Park Pioneer Square Seattle

In a city filled with unique architectural gems and distinctive examples of land use, the Waterfall Garden Park in the Pioneer Square section of downtown Seattle is one of my favorites.

Most of the area, unfortunately, is a wasteland, dangerous at night and just marginal during the day.  But this tiny one-third of a block garden was built in 1977 to celebrate the birthplace of the United Parcel Service.

Most people do not know that "Brown" was founded in Seattle.  UPS originally served as a delivery service for downtown clothing stores and, curiously enough, for women who needed laudanum, a potent form of opium, to relieve the pain of menstrual cramps.

UPS was formed in Seattle in 1907 by two 19-year old kids with $100 and two bicycles.  The company today is ranked #61 on the Fortune 500 list and has 803,000 employees worldwide.

And it all started on this spot, now beautifully marked by an amazing garden in the heart of an urban jungle.  The Waterfall Garden Park is more than an oasis, it is a striking example of what can be done with a tiny footprint of land, a brilliant piece of land use that should not be missed.

I shot this video myself on a beautiful afternoon, September 30, 2010.  I started outside the park and walked through it and circled around to where I started.  My impressions are always the same when going to the Waterfall Garden.  What a compelling place to meet a friend, drink a coffee, or just enjoy the sound of the running water and the inspiration it can provide.