Saturday, March 31, 2012

Peter Vekselman



When I was writing my last post for this blog on California unemployment, I saw an advertisement on my own website that I could not believe.

Someone was running an ad of a very attractive young woman (with deep cleavage) saying "She will NOT TALK to You if You are Broke!"

WOW!  That's sure not subtle.

But what I found completely fascinating was that the "Click Here Now!" button of the ad was right over her left breast!  Literally the "C" of "Click" was hovering over her left nipple!  Talk about Pavlovian associations!

This is classic subliminal advertising, or subconsciously introducing sexual images into sales messages in order to stimulate not just sales.  It's been done for years by huge companies everywhere from Disney to Coca-Cola but this is the first time ever that I've seen such methods used to sell real estate home study courses and seminar tickets.  Here are some examples of subliminal advertising.

I wanted to find out who was advertising this way.  Real estate gurus usually talk about using your head in creative ways but in this case I wasn't sure what head was meant.

At first, I thought the real estate guru's name was "Peter Now."  After all, the ad says "Get Real Estate Coaching from Peter Now."

What the ad really meant to say was "Get real estate coaching from Peter now."

The link, CoachingByPeter.com, takes you to a site maintained by Peter Vekselman.  A video on the site by Mr. Vekselman introduces you to him, his experience, and what he has to sell.

I have never heard of Peter Vekselman before.  What I found positive about his sales pitch is that his real estate experience is DIRECT and not INDIRECT.

What I mean by this is a great many real estate gurus claim the deals and success of their clients as THEIR experience.  For example, a sales agent and broker in ten years might close 200 deals worth $100 million on behalf of their clients.  Great work!  But when this agent starts selling their "How I Did $100 Million in Real Estate Deals" home study course for $2,995 the deals suddenly became their own and not their clients.

This is a very common get-rich-quick real estate guru trick.  For example, when MONEY magazine investigated Foreclosures.com real estate guru Alexis McGee in 2007, MONEY learned that the experience she was claiming as a dealmaker actually came from transactions she arranged for clients while acting as an agent.  MONEY also investigated a "successful" McGee student named Daryl White and came to the same conclusion.

McGee, for example, claimed she made "millions" of dollars with foreclosure properties.  MONEY could only find four actual deals with her name on them.  The rest were transactions she did as an agent.

So when Peter Vekselman up front claimed that he personally has done many real estate transactions over many years, I appreciated that statement.  (I'll assume it's true.)

Mr. Vekselman has many websites on the Internet, as is the practice of many real estate gurus.  In other words, he's part of the business.  But here is one Peter Vekselman profile he created on a website called BiggerPockets.com where he claims he only started investing in real estate in October 2008!  Could there be two Peter Vekselmans, father and son?  I honestly don't know.



He also has many pitch videos available on YouTube, much like this one.

I would appreciate learning more on Peter Vekselman.  As I said, I know nothing about him or his products.   He is not selling a book as far as I can find.  It seems he is mostly offering mentoring services, of which I can say I am not a fan.  They are usually very expensive.  Consider the HOURLY cost, not the value of the claimed benefits.

For the record, I also do not believe any of the comments I read online about Mr. Vekselman since I know that nearly 100% of what is written about me is false.  Anonymous posters on the Internet almost always have an axe to grind, for good reasons or malicious ones.  Either way they exaggerate.

As I do with all real estate gurus, I wish Mr. Vekselman the best, but I really hope he changes his ad.  I know many gorgeous women who not only talk to broke guys but refuse to date any other type.  These broke, often unemployed, and insolvent men go by many names---musicians, actors, and artists.


Friday, March 23, 2012

California Unemployment



The California Employment Development Department today reported that 4,000 non-farm jobs were created in the state in the month of February 2012.

California now has an unemployment rate of 10.9%, unchanged from January.

The same office tells us there are TWO MILLION unemployed people in the state of California.

Only 4,000 jobs created in an entire month in the largest state in the United States.

2,000,000 people officially unemployed.  How many hundreds of thousands more underemployed and so discouraged they are no longer part of the California labor market?

I keep hearing about the amazing economic recovery underway.  How a new prosperity is sweeping the land as all the financial sins of the past melt away in the sunshine of the new always blue skies ahead.

There's only one problem.

The unemployment numbers being reported by the states like California do not match the GDP growth statistics and national economic measures coming from the Feds in DC.

I wish Congress would investigate these numerous and troubling discrepancies, starting with how the Bureau of Labor Statistics calculates the unemployment rate.  How fewer desperately seeking job seekers can be working but the unemployment rate goes down is just too complex for me.  I'm a common sense person.  Unemployment goes up when fewer people who want jobs have them and vice versa.  Even an educated guy like Larry Summers can't explain the BLS Labor Force Participation Rate with clarity.  Watch this interview.


This is what I find most troubling of all.

All the wild government spending in Sacramento that is bankrupting the state and all the private businesses in California with borrowing costs near zero could only produce 133 jobs a day.

4,000 jobs down.

1,999,996,000 to go.

Wednesday, March 21, 2012

Howard Roark



In Hollywood films, there are few heroes in the world of real estate.

Most real estate developers, brokers, and sales agents are portrayed as villains, greedy sniveling weasels who take pleasure in destroying the environment, evicting widows and orphans from their homes, and stealing the dreams of everyday people just to make a profit.

The list of negative portraits of real estate professionals in the movies is long, very very long.  And the list is always getting longer for me.


The other night I watched Eddie Murphy star in THE HAUNTED MANSION, the 2003 film based of all things on a Disney theme park ride.  (Just like Johnny Depp's PIRATES OF THE CARIBBEAN films, by the way).  In this (boring) movie you can see real estate agent Eddie sleaze his way through all sorts of real estate deals.  My favorite is when he doesn't think the listing agent needs to reveal that the mansion they are trying to sell is....HAUNTED.

All this may seem like harmless fun but it is not.  DECADES of these negative portrayals have left the general public (and their elected representatives in your local City Hall zoning and land use offices) with the idea that the only reason people go into real estate development is to make lots of money at the expense of the poor and the innocent.  The presumption from the start is AGAINST your projects,  your subdivisions, and your renovations because profit is the motivation, not altruism or the desire to actually provide safe, clean, and affordable housing and office space.

Try to get a new real estate project approved, even one you can prove is necessary for a community and will create jobs and other benefits.  The battle is always uphill.  Always, no exceptions.

Hollywood and its relentless message of real estate greed is part of the reason.



One of the few real estate heroes in all of film history is Howard Roark from Ayn Rand's famous novel, THE FOUNTAINHEAD.  Portrayed by Gary Cooper in the 1949 film, the architect Roark is hired to build a housing development called Cortlandt but only on the condition that no changes be made to his plans.  When his patrons betray him and gut his project, Roark destroys Cortlandt with dynamite.  Charged with a crime, he offers this defense in court---and is acquitted.

It is certainly one of the longest movie monologues in history outside of Shakespeare.

But I dare you to listen to it and not think about this year's election.  AND what being a real estate professional means to you.  Is it really just about money?

Ayn Rand wrote the screenplay.  Those are her words you hear.  If you like them, read more.

You can also start with this impressive interview she gave with CBS reporter Mike Wallace.



Friday, March 16, 2012

Senator Happy Chandler



"All of us owe the government; we owe it for everything we have--and that is the basis of obligation--and the government can take everything we have if the government needs it.  The government can assert its right to have all the taxes it needs for any purpose, either now or at any time in the future."


U.S. Senator Albert Benjamin "Happy" Chandler
(Democrat from Kentucky)
From a speech delivered on the Senate floor
May 14, 1943

Wednesday, March 7, 2012

Hedge Funds Buy Homes

The big boys are starting to play in the single family house residential market.

Not a good trend for individual investors.

They can borrow money cheaper than you can.

They can set neighborhood rents lower than your break even points and do it on purpose so you will sell your properties to them.

They can offer incentives on rentals you cannot match.

The single family house investor almost always was an individual investor, a mom-and-pop operator.  Not a private equity fund or publicly traded REIT.

The institutional investors are chasing yields and they will chase a good many individual investors out of this market for good.