There’s always something to howl about

Archive for October, 2008

Arthur Laffer: “The Age of Prosperity Is Over”

The author of the Laffer Curve in the Wall Street Journal:

When markets are free, asset values are supposed to go up and down, and competition opens up opportunities for profits and losses. Profits and stock appreciation are not rights, but rewards for insight mixed with a willingness to take risk. People who buy homes and the banks who give them mortgages are no different, in principle, than investors in the stock market, commodity speculators or shop owners. Good decisions should be rewarded and bad decisions should be punished. The market does just that with its profits and losses.

No one likes to see people lose their homes when housing prices fall and they can’t afford to pay their mortgages; nor does any one of us enjoy watching banks go belly-up for making subprime loans without enough equity. But the taxpayers had nothing to do with either side of the mortgage transaction. If the house’s value had appreciated, believe you me the overleveraged homeowner and the overly aggressive bank would never have shared their gain with taxpayers. Housing price declines and their consequences are signals to the market to stop building so many houses, pure and simple.

But here’s the rub. Now enter the government and the prospects of a kinder and gentler economy. To alleviate the obvious hardships to both homeowners and banks, the government commits to buy mortgages and inject capital into banks, which on the face of it seems like a very nice thing to do. But unfortunately in this world there is no tooth fairy. And the government doesn’t create anything; it just redistributes. Whenever the government bails someone out of trouble, they always put someone into trouble, plus of course a toll for the troll. Every $100 billion in bailout requires at least $130 billion in taxes, where the $30 billion extra is the cost of getting government involved.

If you don’t believe me, just watch how Congress and Barney Frank run the banks. If you thought they did a bad job running the post office, Amtrak, Fannie Mae, Freddie Mac and the military, just wait till you see what they’ll do with Wall Street.

Some 14 months ago, the projected deficit for the 2008 fiscal year was about 0.6% of GDP. With the $170 billion stimulus package last March, the add-ons to housing and agriculture bills, and the slowdown in tax receipts, the deficit for 2008 actually came in at 3.2% of GDP, with the 2009 deficit projected at 3.8% of GDP. And this is just the beginning.

The net national debt in 2001 was at a 20-year low of about 35% of GDP, and today it stands at 50% of GDP. But this 50% number makes no allowance for anything resulting from the over $5.2 trillion guarantee of Fannie Mae and Freddie Mac assets, or the $700 billion Troubled Assets Relief Program (TARP). Nor does the 50% number include any of the asset swaps done by the Federal Reserve when they bailed out Bear Stearns, AIG and others.

But the government isn’t finished. House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid — and yes, even Fed Chairman Ben Bernanke — are preparing for a new $300 billion stimulus package in the next Congress. Each of these actions separately increases the tax burden on the economy and does nothing to encourage economic growth. Giving more money to people when they fail and taking more money away from people when they work doesn’t increase work. And the stock market knows it.

The stock market is forward looking, reflecting the current value of future expected after-tax profits. An improving economy carries with it the prospects of enhanced profitability as well as higher employment, higher wages, more productivity and more output. Just look at the era beginning with President Reagan’s tax cuts, Paul Volcker’s sound money, and all the other pro-growth, supply-side policies.

Bill Clinton and Alan Greenspan added their efforts to strengthen what had begun under President Reagan. President Clinton signed into law welfare reform, so people actually have to look for a job before being eligible for welfare. He ended the “retirement test” for Social Security benefits (a huge tax cut for elderly workers), pushed the North American Free Trade Agreement through Congress against his union supporters and many of his own party members, signed the largest capital gains tax cut ever (which exempted owner-occupied homes from capital gains taxes), and finally reduced government spending as a share of GDP by an amazing three percentage points (more than the next four best presidents combined). The stock market loved Mr. Clinton as it had loved Reagan, and for good reasons.

The stock market is obviously no fan of second-term George W. Bush, Nancy Pelosi, Harry Reid, Ben Bernanke, Barack Obama or John McCain, and again for good reasons.

These issues aren’t Republican or Democrat, left or right, liberal or conservative. They are simply economics, and wish as you might, bad economics will sink any economy no matter how much they believe this time things are different. They aren’t.

Read the whole thing.

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Pinching Pennies And Blowing The Big Bucks

Another Installment In The Saga Of Unintended Consequences

Most of us have been driving less, lately. Record high oil prices drove gasoline prices to over $4 a gallon – wreaking havoc on our personal budgets… and the nation’s economy as a whole.

Last Friday, I stopped in to visit my mechanic – and as usual, he told me about the car he was busy working on. This time, it was an engine rebuild due to “bad gas”.

“Bad gas?” I asked.

“The deposits built up so that the valves wouldn’t close properly,” he replied. “We’ve had four rebuilds in the last few weeks. I’ve never seen anything like it.”

While it might be bad gas – I have another take on it. With the enormous increase in fuel costs, most of us are driving like little old ladies – myself included. But driving for maximum fuel economy is not necessarily good for your engine, as it allows carbon to build up on your valves.

I first learned about this in the early 80’s, as my mechanic back then told me about one of his customers – an elderly lady – who would bring her car in every few months so that he could take it out on the freeway and give it a good run.

You can tell when your engine needs to get the carbon blown out, as your engine will be idling rough. The best way to blow the carbon out is to accelerate hard on a freeway onramp – running it through the gears until you get up to highway speed. It works best when there is a good load on your vehicle, such as climbing a hill.

I have “blown the carbon” out of my vehicles for years – and I even have a friend who asks me to take her car out a few times a year to blow her carbon out, as she’s uncomfortable doing it herself.

Another tip is to have your fuel injectors professionally cleaned, which also can help keep your engine’s valves clean.

An engine rebuild is not inexpensive  – it is a repair that can cost thousands of dollars. So before you spend the big bucks… maybe you should put the pedal to the metal every now and then.


Mouth to Mouth Capitulation

My favorite homeless guy, a poor weather worn soul named Johnnie, has been hawking the morning Tribune at the corner of Hollywood and Broadway ever since I moved to Chicago in the mid-1990s. Idling at the stoplight, awaiting my green arrow signal into the rush hour flow of Lake Shore Drive, I’ll usually just hand him a dollar through the window and let him keep my inky copy of pulp to sell to someone else although I suspect he probably just buys whiskey with the windfall. I wonder how much booze a handful of change and a few crumpled bills can buy a guy so down on his luck these days? Whatever the answer, Johnnie doesn’t care to hide the sad fact that he’s a practicing alcoholic–not from me, at least. Not from anybody, really, with a sense of smell, or sight, or society.

“Got anything extra today, boss?” he’ll sometimes ask in one way or another. This makes me uncomfortable for a couple reasons, not the least of which being how lousy a boss I really was when I actually held such a title. That, of course, and the fact that the mere greenback I just handed him isn’t what it used to be. “Trying to get a bottle of Four Roses for later.” He lives for ‘the later,’ this guy. (As if Johnnie is somehow certain that both ‘the here and now’ the rest of us choose to pursue is any less elusive or any more fulfilling.)

“The Dow closed down over 500 points yesterday…” or “That billionaire’s airplane was found in California…” or “Obama kicked McCain’s ass again last night in the debates…” he’ll feel inclined to report to me, repeating the headlines since, like I said, I rarely take my full dollar’s worth of newsprint in exchange. He wants to give me a little something extra for my buck although he’s quick to add, “The Euro is kicking the Dollar’s ass all over the global markets.” Hint, hint. He stands there outside my car window either shivering or sweating depending on the season, also waiting for the light to change from his little nickel and dime spot on the concrete median strip. “The Yen, too,” my personal anchor-less man, trying to squeeze a little extra juice from the boss in the BMW. “The economy sucks,” he surmises.

Several years ago he asked me if I could help him get an apartment on a week-to-week basis without a lease. I determined this to be an almost impossible feat and ended up dropping him off at an AA meeting at Illinois Masonic Hospital instead. “I can usually get a cafeteria meal out of somebody there and then crash in the emergency room lobby for the night if I play it right” he told me as he exited my vehicle. “The third shift nurses all like me.” Wink, wink. “Maybe get a little mouth to mouth if I’m lucky.” The picture still freezes in my mind whenever I recall that evening. Good thing, probably for everyone involved, that Johnnie is not a lucky man…

“Hey boss,” he asks me the other morning, each of us on our respective sides of the window glass waiting for the green arrow to change for the millionth time in as many years, it seems. “What’s this word?”

He points to a sidebar headline in the new Trib layout that simply reads: CAPITULATION?

“Isn’t that sexual or something?”

“I don’t think so,” I answer. “I’m pretty sure it means bottoming out.” He looks back at me like he understands exactly what that means. “You know. The stock market,” I add.

“The Dow?” he asks.

“Yeah, the Dow and all the others. NASDAQ, Nikkei…” I hesitate before stopping completely, already over my own head on the subject. A true boss would know more, for sure.

“How do you say it?” he asks.

“Cap-it-choo-lay-shun,” I pronounce. “It means things are about to look up.”

He takes my dollar through the window and smiles. “Bullshit,” he says.

“That too,” I add.

“Hawks won again last night. Bulls too,” he says as the arrow blinks green and I begin to meld my own ingredients into the morning mix of real estate commerce. What Johnnie has to report is not enough good news for me to shell out any more than a buck on this day. I mean hell, it’s not like the Cubs made the Series or the CAPITULATION? headline didn’t also have that ambiguous question mark at the end of the word. No true reason to CELEBRATE?. Right?

“Don’t drink,” I say pulling away and into the fold.

“I will,” says he standing still


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Click on the PayPal button shown below to get your $99 ticket for BloodhoundBlog Unchained in Orlando on Friday, November 7th, 2008

When: Friday, November 7th, 2008, 8 am to 8 pm

Where: Crowne Plaza Hotel and Conference Center, Orlando Airport, 5555 Hazeltine National Dr, Orlando, FL 32812

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A Disturbing New Dynamic

Although this post discusses the election in general, it is not meant to instigate a general discussion of the election.  It is… a non-political post on politics.

In talking to various people about the upcoming presidential election and their preferences, I was stuck by an odd response I kept hearing – in various forms – over and over again.  I decided to do an extensive, double blind study – exhausting all resources in order to generate a valid conclusion.  Following this study, I now believe we are witnessing a new election dynamic (or at the very least a dynamic not previously seen in our life time).

Editor’s Note: By “extensive” I mean I asked anyone who walked into, out of or near my office doorway.  I did not actually go the whole distance and get up off my seat.  Also, by “double blind” I mean to say neither I nor the person I interviewed had a clue what we were talking about.  I imagine my idea of “exhaustive” needs no further explanation…

In all seriousness, when I meet someone voting for either candidate I ask them a straightforward question: “Why are you voting for that candidate?”  Even though I spoke with a full spectrum of ideologies, I heard a similarity in all their responses.  If the person was an Obama supporter they would provide answers such as “four more years of Bush… disastrous deregulation by the current administration… conservative duplicity with Wall Street” and so on.  If the person was a McCain supporter they would provide answers such as “tax and spend Democrats… redistribution of wealth… lack of liberal strength in the face of terrorism” and so on.  I rarely got an affirmative answer with regard to their candidate of choice.  In other words: they were not voting for someone so much as voting against someone else.

That people cast their vote for someone they are not particularly excited about is not new.  Nor is casting a vote solely in opposition to the other candidate.  What is groundbreaking (and, so far as I know, not being reported) is that this year, for the first time ever, the percentage of people voting against the other party appears to be greater than the percentage voting for their party.  A strange little dynamic: a populace divided not by what they believe in but rather by what they do not believe in.

  • Does this reflect a jadedness now become pervasive?
  • Is it indicative of a society operating mostly on fear and anger?
  • When one votes for a candidate and that candidate loses, it is not so difficult to envision uniting behind the new leader for the greater good of the nation.  But when one votes against a candidate who subsequently goes on to win, well… that is a very different perspective indeed.  It leaves little room for reconciliation.

I am not sure what the ramifications are when a nation crosses this tipping point in elections; when a majority of voters cast votes to reflect their enmity rather than their alliance.  I don’t know what affect it will have, but somehow I doubt it will be good.


Real estate and the ties that bind: “I have to warn you, my mom’s a bit crazy”

Just because I write on Bloodhound, doesn’t mean I have a big mouth… Or does it? Either way, when I’m with clients I try to do more listening than talking. I can’t help them if I don’t know what they are thinking.

I enjoy working with young clients. I love the energy, the enthusiasm, the optimism. It doesn’t matter how experienced they are at buying property, it’s their youthfulness that is so fun to be around. We establish a rapport quickly, and my blog helps with that. I’m told by these clients that they read my blog, so they know they can trust me. Older clients don’t read my blog- they find me elsewhere- so the trust is slower in coming. The agent/client relationship is much more solid at a faster pace with blog readers.

Yesterday I spent a glorious fall day walking acreage with a young couple from out of town. We have been emailing and phone calling for about two months now. They were in town in September to look at property, but I was at BlogWorld. A colleague was kind enough to jump in and show them around, but the couple and I missed the chance to look each other in the eyes, shake hands, size each other up, all those physical things that happen in a face-to-face meeting.

They decided they wanted to look at acreage, farmland. They have some farming experience in Europe, and Mom farms and Mom will be spending time with them here. Mom wants a farm. They were coming to town this weekend and we found some properties that met their criteria, set up the appointments. Oh and by the way, Mom is here, so she’ll be coming.

This sometimes happens with young clients. Mom and Dad, my generation or older, have some experience with real estate, and real estate agents. They are in town, so either they are coming along to make sure their babies are not getting ripped off, or they are coming along to give real advice and a second opinion.

Always, I get prepped from the daughters: “My mom is coming along. I have to warn you that she’s a bit crazy.” I find it interesting that so many daughter’s describe their mothers as “crazy”. As the mother of a daughter, a teenage daughter, I think it’s highly possible that I’m described that way. I know I feel that way occasionally and oddly enough my daughter is often present during those times. I’m grateful for the head’s up though, because what it really tells me is that both mom and daughter have strong opinions, which means it’s time for me to shut up.

So I do.

I grew up with brothers. I can step aside and let a female be the Queen Bee. If the property needs the Mom Seal of Approval, then fine with me. I allow Mom to share her experience and knowledge, answer questions when asked, take copious notes when warranted. And I always find out that Mom is just a Mom- not a raving lunatic, not a crazy person, not some maniac who somehow managed to pull her thoughts together just long enough to raise the daughter before succumbing to the insanity that has been lurking below the surface for the past 22 years. No. Crazy Mom is simply a woman who raised her daughter to have an opinion and voice it when she felt the need.

It’s the end of the day. Seven hours of walking farm fields, creeks, and overgrown bramble; our boots are coated in mud, the spare burr hitchhiking on our jeans. We are tired, but happy. Goals were met, questions were answered, decisions were made. And strangely enough, Mom didn’t need the straight jacket after all.

Hand shakes and “Pleasure to meet you”s all around. Mom smiles a genuine smile, leans close to me, grasps my arm and whispers “I know you will take care of them”. And there it is. Crazy Mom was unable to contain herself any longer. Listen to her talk! Who understands what she babbles on about?

Well. I do, beloved Daughter. I do.


Why Bloggers Fail To Become Top Producers

I know your secret.  Honestly…I do.

You aren’t knocking the ball out of the park, regardless of your blogging effort.  You play around on Twitter, Facebook, Active Rain, and might even comment on Bloodhound Blog.  You’re probably REALLY smart and can’t believe that you’re having problems in business.  I know you are; I’ve read most of your blog posts, Tweets, and Facebook messages.  You fancy yourself ethical.  I believe that, too.

Why is a smart, ethical real estate agent like you failing then?

You got hoodwinked.  Tricked.  Sold a bill of goods.  That snake oil you bought?  Web 2.0- it was supposed to be the new way to do business; you just didn’t realize it was gonna take 3-5 years.  It’s taking longer than you imagined and you’re stuck.  Your spouse is riding your ass as she punches a clock while you play on Twitter.  Your kids wonder why you treat the occasional prospect who calls you to Ruth’s Chris while making them eat off the value menu at Mc Donald’s. You’re failing because you bought into the hype and you’re scared to admit that you blew it.

That’s okay- it’s not your fault.

You see, I got hoodwinked too.  I was all puffed up, speaking in San Francisco and New York like I was some kind of expert.  As I was hob-nobbing with the, I heard more than one of the “blogging elite” talk about their fear of personal foreclosure.  I heard the practitioners talk about losing their homes and the tech gurus talk about how rich they were getting…

…off the poor practitioners whom they appointed “experts”. THAT disgusted me.

I knew I had to make a VERY big change in my life.  I was following the “wrong crowd” and if I kept it up, I’d be face-down, lying in the gutter, with no customers at all.  I definitely didn’t want that…so I made some changes.  Those changes, combined with the things I learned from the folks who DO make money online, grew my business while my competitors were submitting employment applications at the mall.

Let me do my best Joe Biden…  It’s not your fault.

Greg Swann and I hosted the Bloodhound Blog UNCHAINED Social Media Marketing Conference (sponsored by Zillow).  About one hundred people gathered for three days and listened to the ideas about the brave new world.  We learned a few things and changed our Orlando conference to reflect those revelations:

1- SEO matters.

2- SEO can be helped but not manufactured.

3-  Organic online branding, which we talk about constantly, does take time.  It is the future of marketing for real estate and mortgage brokerage but the critical mass isn’t there, yet.  It’s coming and we need to be prepared.

4- You (and I) can go broke waiting for the masses to move to the right side of the learning curve.  While we’re waiting, we need to find out EXACTLY how to find those potential buyers and deliver content to them.

5- IDX solutions work.  The contact information capture feature, as distasteful as you may find it, works.  Joe the Plumber searches for homes online and listings are the bait.  Blog content, designed to call Joe to action, augment but can’t replace the contact information capture feature JUST YET.  I will stipulate that more savvy consumers demand free access to listings but the average home shopper will give up his contact information to see home listings.  There is a way to appease both sets of consumers and Greg Swann will teach you how to do it.

6- Social networking DEFINITELY works but you gotta bridge the digital divide that keeps potential customers behind that cyber-wall.

7- Top of mind status is important.  Seth Godin talks about the importance of permission-based marketing but Gary Keller showed you how to do it.  I’ll talk about how to advance the MREA idea and integrate it in into your social media efforts.

8- Buying traffic doesn’t suck as much as we think it does.  It costs money and it constantly evolves but it DOES work.  You’ll have a chance to hear Mitch Ribak discuss this.  He is doing volume that places him among the top 50 real estate teams in the country.  Mitch gets his business by buying traffic.

9- There is more than one way to “skin the cat”.  Kelley Koehler (aka HouseChick) found out how and you’ll have a chance to hear how the HouseChick finds gold in sparsely searched streams for a lot less money.  It’s tricky but effective.

Click on the PayPal button shown below to get your $99 ticket for BloodhoundBlog Unchained in Orlando on Friday, November 7th, 2008

Let’s face it.  The RE 2.0 world just ain’t cutting it for practitioners by itself.    Oh, there are people making a living through blogging but they aren’t demonstrating break-out results.  While we are committed to the future, we live in the present…and the present challenges are just too much for the 2.0 offerings.  Here’s what you can learn at the Bloodhound Blog UNCHAINED Online Marketing Conference in Orlando, Friday, November 7, 2008:

Greg Swann will deliver his manifesto about the “brave new world”.  If you haven’t heard it, it’s nothing short of amazing.  He’ll tell you why you, the real estate practitioner, can disintermediate traditional chokepoints and talk directly to the consumer.  He’ll explain how to use the principles of direct response marketing in your online profiles….so they sell your services 24/7/365 (even while you’re fast asleep).  He’s teach you how to farm the big guys’ crops by using their strength against them.

I’m going to discuss my ninja-like tactics of social media marketing.  I”ll show you how to contribute to a community, position yourself properly online, demonstrate expertise, and have customers to talk about YOU.  I’ll share the six words, placed in the proper forum, that led to eight closed loans in a three month period.  I’ll show you the single best Facebook feature, the hidden 2.0 feature of LinkedIN, and the best place to find Joe the Homebuyer online (HINT: Joe isn’t in a sea of voices nor is he checking out homevalues).

Alas, while the title suggests that blogging won’t get you to the top, that doesn’t mean that top producers can’t blog.  Teri Lussier will show you how to avoid the echo chamber and build a local community through a weblog:

Warning: This is not the Get Rich Quick way of Blogging for Dollars. This is the slow and thoughtful way of connecting, networking, communicating. It doesn’t get you to the top of Google in 30 days, but it does get you as close to belly-to-belly as you can get online. It means you have to pay attention, think, share, discuss. It also means that we may not have anything in common, so I’m going to have to work to find a common ground. It means that I will find something interesting in your posts, and share it on my blog. In other words, it takes time to build relationships locally, which may not be the case with the echo chamber.

The echo chamber: I’m okay, you’re okay; I’m a Realtor, you’re a Realtor. Ah. A shared experience, a common ground. I may not have to pay too much attention because we have real estate in common. Unlike those local folks who may not want to talk to me at all because I’m a Realtor. You and I can fall into conversation faster, with more ease, talk shop- and it’s all good. Except it isn’t really. Ultimately it’s distracting to someone like me.

Sean Purcell will share how he is listing (and selling) properties “The Bloodhound Way”:

So… within minutes of hanging the sign I had eyeballs from three cars and conversion on one; you have got to love that kind of impact!  BTW, the first thing my clients said was they loved the sign.  I remarked how standard signs only tell people a house is for sale while marketing for the brokerage.  One of the ideas behind a custom sign is to encourage people to stop the car and get out to read the sign (thus increasing the possibility of interest).  They replied: ”This should do it.  You know… every agent in the area is going to stop and read it!”  Just love that.

I told you about Kelley Koehler.  Don’t listen to me, listen to Teri Lussier’s description of her presentationWhat to Do When Google Doesn’t Love You“:

If you are not paying attention to what the Housechick is doing, you are missing out on one of the sharpest minds in the Her Vegas presentation on Pay Per Click marketing was, by all accounts, one of the best sessions of the entire weekend. Watch this space and learn how brilliant and unique marketing can create a kickass online presence. Some take aways that you can put to use whether or not you care to PPC “Win the small battles. Go niche.” Kelley’s focus for her ads is not for broad search terms like “Tucson real estate”, but in very well defined terms like “average sales price for homes in Tucson”, or even more narrow- down to neighborhoods. Then she writes posts to answer that question. She likes to focus on verbs “Buy a home in Tucson”, “Search for a Tucson home”. She’s using concise terms, with a clear benefit, and action words to create her ads. I think using those parameters as a basis for a post and post titles, is a wise idea. Write to that person’s mind, write in an engaging style, you’ve got yourself a blog that has real value for the reader.

Click on the PayPal button shown below to get your $99 ticket for BloodhoundBlog Unchained in Orlando on Friday, November 7th, 2008

I already mentioned Mega-Producer Mitch Ribak.  He’s breaking records in a crappy real estate market (The Space Coast ain’t exactly “hot”). How the heck does he do it?  Well, this isn’t Mitch’s first rodeo.  He’s been involved with internet marketing long before he started in real estate.  You’re never gonna believe how he learned it.  I asked him and he told me:

One thing most of you don’t know about me as my first Internet business was a Dating Service. Not only did I have the dating service, I had an advice column called Oh and there was the radio show, Ask Mitch The Date Doctor, that played on 45 radio stations around the country.

So, yes, my venture into the Internet back in 1996 came from my imagination that there has to be a better way to do business.

I worked for Great Expectations Video Dating Service as their Director from 1993 to mid 1996. It was the only time since I was 23 that I hadn’t worked for myself. I spent half of 1996 trying to find a company that would build a dating software for me that I could use over the Internet.

Funny thing was that at that time they all told me it wasn’t possible to do data integration over the Internet. I didn’t believe them of course so for a half a year I searched and talked to tons of companies…it just made sense to me.

Finally I found a company that said they had heard of a new type of software that would allow me to do everything I wanted. My customers would now be able to see pictures and profiles of people over the Internet.

Think you might learn something from Mitch Ribak?  Don’t say that “you’re business is different from a dating site“- Mitch has close to 350 reasons that verify that it isn’t.

While he’ll share his online marketing expertise with you at UNCHAINED Orlando, I forgot to tell you that he offers it at the e-homes realty network.  What I haven’t told you is that Mitch is going to give ALL of the Unchained Orlando attendees two follow-up lessons in addition to a $49 gift (I’ll let him tell you about the gift at the conference).

Click on the PayPal button shown below to get your $99 ticket for BloodhoundBlog Unchained in Orlando on Friday, November 7th, 2008

I know what you’re thinking.  Just what have Greg Swann and Brian Brady cooked up now?  Dating sites?  Long-tail pay-per-click?  The Bloodhound Way of listing?  Building a community weblog?  Cold-calling Facebook profiles?  It will NEVER work because I’m a blogger…and the tech guys TOLD me that RE 2.0 works

I’ll say it again, just like Joe Biden. I know you’re secret.  Honestly, I do.

So, here’s the deal.  I share our secret with you.  We were nowhere near the few hundred people we thought might attend the Bloodhound Blog Unchained Online Marketing Conference in Orlando.  We did a lousy job promoting it because we were pretty busy.  As luck would have it, personal implementation of the principles we discussed in Phoenix caused us both to get REALLY busy in our day jobs.  We lowered our expectations and reduced the room size…and that benefits you greatly.

Unchained Orlando will be MUCH more intimate for the attendees.  You’ll have better access to Mitch, Kelley, Sean, Teri, Greg, and me.  You’ll have a chance to bond with the other folks attending to exchange marketing ideas.  I’m toying with the idea of organizing some “mastermind groups” comprised of the people who show up and participate.

We never said we were in this for the money and thank God that our speakers share their wealth so generously.  Here’s the problem with the smaller room:

There really aren’t a lot of seats left now.

With two weeks left, our market is pretty limited; that’s why I’m hitting those of you who plan to be in Orlando.  If you’re going to the NAR convention, the value we offer, for less than a c-note, will yield a much higher ROI than you’ll get from the convention…

…although I LOVE Kool & The Gang.

Click on the PayPal button shown below to get your $99 ticket for BloodhoundBlog Unchained in Orlando on Friday, November 7th, 2008

When: Friday, November 7th, 2008, 8 am to 8 pm

Where: Crowne Plaza Hotel and Conference Center, Orlando Airport, 5555 Hazeltine National Dr, Orlando, FL 32812

See you in two weeks!


Foreclosure homes are sold “as-is” — but most need only minor restoration to bring them back to fully-livable condition

This is my column for this week from the Arizona Republic (permanent link).

Foreclosure homes are sold “as-is” — but most need only minor restoration to bring them back to fully-livable condition

If we were to have a contest for the Valley’s most-gutted home, judging might take a while.

A significant number of homes for sale in the Phoenix area, especially at the low end of the price spectrum, are in the foreclosure process. Not all of these homes are in rough shape, but a lot of them are. At a minimum, buyers of short-sale or lender-owned homes should anticipate painting the walls and replacing the carpets.

But virtually all foreclosure homes will be sold “as-is.” This means, first, that any defects discovered in the inspection process will be the buyer’s responsibility to repair after close of escrow. But the “as-is” addendum also often implies that there may be serious deferred-maintenance issues.

Still worse, many lender-owned homes will have been looted, either by the former owners on their way out or by burglars. Missing ranges, microwave ovens and dishwashers are common. Air-conditioner compressors and hot-water heaters are also absent from many homes. It is not uncommon to see that all of the ceiling fans or all of the knobs on drawers and cabinets have been removed.

My pick for the most-gutted Valley home? The entire kitchen was gone — even the kitchen sink — and the air-handler had been removed from the attic.

I would not want to refurbish that last home, since there is no telling what else has been taken. But for most lender-owned properties, the cost of bringing the home back to livable condition is fairly low.

A new set of kitchen appliances is maybe $2,500. A brand new air-conditioner compressor is around $4,000. A decent water heater is perhaps $1,200 installed. Paint, carpet and tile in the high-traffic areas should run $5,000 for a typical suburban home, less if you do the work yourself.

There definitely are homes to avoid in this market, but there are many, many others that are selling for very low prices. These properties need only very minor restoration efforts to bring them back to fully-livable condition.

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The Latest Project Bloodhound – Need for Speed Edition

Apparently there is a NEW Project Bloodhound.

Here’s the project website here. I’ll bet that you won’t catch Odysseus hanging his head outside for a whiff of the fresh breeze on THAT car–GRIN.

You gotta admire their taste in names, though!

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Media bias as seen from the inside: “Nothing I’ve seen has matched the media bias on display in the current Presidential campaign”

Reporter Michael Malone writing at Pajamas Media:

The traditional media is playing a very, very dangerous game. With its readers, with the Constitution, and with its own fate.

The sheer bias in the print and television coverage of this election campaign is not just bewildering, but appalling. And over the last few months I’ve found myself slowly moving from shaking my head at the obvious one-sided reporting, to actually shouting at the screen of my television and my laptop computer.

But worst of all, for the last couple weeks, I’ve begun — for the first time in my adult life — to be embarrassed to admit what I do for a living. A few days ago, when asked by a new acquaintance what I did for a living, I replied that I was “a writer”, because I couldn’t bring myself to admit to a stranger that I’m a journalist.

You need to understand how painful this is for me. I am one of those people who truly bleeds ink when I’m cut. I am a fourth generation newspaperman. As family history tells it, my great-grandfather was a newspaper editor in Abilene, Kansas during the last of the cowboy days, then moved to Oregon to help start the Oregon Journal (now the Oregonian). My hard-living – and when I knew her, scary – grandmother was one of the first women reporters for the Los Angeles Times. And my father, though profoundly dyslexic, followed a long career in intelligence to finish his life (thanks to word processors and spellcheckers) as a very successful freelance writer. I’ve spent thirty years in every part of journalism, from beat reporter to magazine editor. And my oldest son, following in the family business, so to speak, earned his first national by-line before he earned his drivers license.

So, when I say I’m deeply ashamed right now to be called a “journalist”, you can imagine just how deep that cuts into my soul.

Now, of course, there’s always been bias in the media. Human beings are biased, so the work they do, including reporting, is inevitably colored. Hell, I can show you ten different ways to color variations of the word “said” – muttered, shouted, announced, reluctantly replied, responded, etc. – to influence the way a reader will apprehend exactly the same quote. We all learn that in Reporting 101, or at least in the first few weeks working in a newsroom. But what we are also supposed to learn during that same apprenticeship is to recognize the dangerous power of that technique, and many others, and develop built-in alarms against their unconscious. 

But even more important, we are also supposed to be taught that even though there is no such thing as pure, Platonic objectivity in reporting, we are to spend our careers struggling to approach that ideal as closely as possible. That means constantly challenging our own prejudices, systematically presenting opposing views, and never, ever burying stories that contradict our own world views or challenge people or institutions we admire. If we can’t achieve Olympian detachment, than at least we can recognize human frailty – especially in ourselves.


But nothing, nothing I’ve seen has matched the media bias on display in the current Presidential campaign. Republicans are justifiably foaming at the mouth over the sheer one-sidedness of the press coverage of the two candidates and their running mates. But in the last few days, even Democrats, who have been gloating over the pass – no, make that shameless support – they’ve gotten from the press, are starting to get uncomfortable as they realize that no one wins in the long run when we don’t have a free and fair press. I was one of the first people in the traditional media to call for the firing of Dan Rather – not because of his phony story, but because he refused to admit his mistake – but, bless him, even Gunga Dan thinks the media is one-sided in this election.

Now, don’t get me wrong. I’m not one of those people who think the media has been too hard on, say, Gov. Palin, by rushing reportorial SWAT teams to Alaska to rifle through her garbage. This is the Big Leagues, and if she wants to suit up and take the field, then Gov. Palin better be ready to play. The few instances where I think the press has gone too far – such as the Times reporter talking to Cindy McCain’s daughter’s MySpace friends – can easily be solved with a few newsroom smackdowns and temporary repostings to the Omaha Bureau.

No, what I object to (and I think most other Americans do as well) is the lack of equivalent hardball coverage of the other side – or worse, actively serving as attack dogs for Senators Obama and Biden. If the current polls are correct, we are about to elect as President of the United States a man who is essentially a cipher, who has left almost no paper trail, seems to have few friends (that at least will talk) and has entire years missing out of his biography. That isn’t Sen. Obama’s fault: his job is to put his best face forward. No, it is the traditional media’s fault, for it alone (unlike the alternative media) has had the resources to cover this story properly, and has systematically refused to do so.

Why, for example to quote McCain’s lawyer, haven’t we seen an interview with Sen. Obama’s grad school drug dealer – when we know all about Mrs. McCain’s addiction? Are Bill Ayers and Tony Rezko that hard to interview? All those phony voter registrations that hard to scrutinize? And why are Senator Biden’s endless gaffes almost always covered up, or rationalized, by the traditional media?

The absolute nadir (though I hate to commit to that, as we still have two weeks before the election) came with Joe the Plumber. Middle America, even when they didn’t agree with Joe, looked on in horror as the press took apart the private life of an average person who had the temerity to ask a tough question of a Presidential candidate. So much for the Standing Up for the Little Man, so much for Speaking Truth to Power, so much for Comforting the Afflicting and Afflicting the Comfortable, and all of those other catchphrases we journalists used to believe we lived by.

I learned a long time ago that when people or institutions begin to behave in a matter that seems to be entirely against their own interests, it’s because we don’t understand what their motives really are. It would seem that by so exposing their biases and betting everything on one candidate over another, the traditional media is trying to commit suicide – especially when, given our currently volatile world and economy, the chances of a successful Obama presidency, indeed any presidency, is probably less than 50:50.

Furthermore, I also happen to believe that most reporters, whatever their political bias, are human torpedoes . . .and, had they been unleashed, would have raced in and roughed up the Obama campaign as much as they did McCain’s. That’s what reporters do, I was proud to have been one, and I’m still drawn to a good story, any good story, like a shark to blood in the water.

So why weren’t those legions of hungry reporters set loose on the Obama campaign? Who are the real villains in this story of mainstream media betrayal?

The editors. The men and women you don’t see; the people who not only decide what goes in the paper, but what doesn’t; the managers who give the reporters their assignments and lay-out the editorial pages. They are the real culprits.

Why? I think I know, because had my life taken a different path, I could have been one: Picture yourself in your 50s in a job where you’ve spent 30 years working your way to the top, to the cockpit of power . . . only to discover that you’re presiding over a dying industry. The Internet and alternative media are stealing your readers, your advertisers and your top young talent. Many of your peers shrewdly took golden parachutes and disappeared. Your job doesn’t have anywhere near the power and influence it did when your started your climb. The Newspaper Guild is too weak to protect you any more, and there is a very good chance you’ll lose your job before you cross that finish line, ten years hence, of retirement and a pension.

In other words, you are facing career catastrophe – and desperate times call for desperate measures. Even if you have to risk everything on a single Hail Mary play. Even if you have to compromise the principles that got you here. After all, newspapers and network news are doomed anyway – all that counts is keeping them on life support until you can retire.

And then the opportunity presents itself: an attractive young candidate whose politics likely matches yours, but more important, he offers the prospect of a transformed Washington with the power to fix everything that has gone wrong in your career. With luck, this monolithic, single-party government will crush the alternative media via a revived Fairness Doctrine, re-invigorate unions by getting rid of secret votes, and just maybe, be beholden to people like you in the traditional media for getting it there. 

And besides, you tell yourself, it’s all for the good of the country . . .


Tiger the Caddie?

Last Monday Tiger Woods returned to Torrey Pines in beautiful San Diego, but not to golf.  Instead he caddied for John Abel, winner of the “Tee Off With Tiger” online sweepstakes sponsored by Buick.  This is such a great picture that I can’t help but fill in some dialogue.  Mine is below.  What do you hear them saying?

AP Photo/Lenny Ignelzi

Abel: “This looks like a tough one Tiger.  What would you do here?”

Tiger: “Well, I would push this putt along a path eleven inches left of the true line, with just enough touch to clear the fringe but still allow the natural slope of the green to pull the ball back and down, dropping into the hole dead center… I have no idea what you are going to do.”

AP Photo/Lenny Ignelzi


Mortgage Market Week in Review

Here we are on Friday again.  That means that it’s time to try to summarize what’s going on in the mortgage and finance world.   I’m going to talk about a couple of main things:  the economic fundamentals, some earnings reports and the “margin calls” that are going on in the equity markets.

The economic fundamentals that have come out in the last week or two have all been, shall we say, poor.   Not just in the United States, but England, Asia and other places, the economic reports all show pretty solid evidence that we are either in or heading into (depending on where you are) a recession and that it’s most likely not going to be a short recession but more likely the opposite – a long and painful one.   I’m not going to go into the details of the different reports because it would be too depressing.

Earnings Reports (or shall we say, loss reports?)   I’m going to do something a little different this time.   I’m going to give you the numbers and then later in the e-mail, I’ll tell you who they matched with.   Here’s the numbers:


(oh and these are all just for the most recent 90 days).

Here’s the choices for the companies who made them:

National City Bank
Fifth Third Bank
I’ll tell you a bit further down which one did which……

Now for a few thoughts about what’s going on in the equity markets and how that has an impact on the mortgage and real estate markets.   Here’s an overview of it:

1. The mortgage backed securities market is a highly leveraged market.

2. As approximately 5 to 7% (that’s right, it’s only 5 to 7% of all mortgages that are causing this problem) go bad, the value of the mortgage backed securities (also known as Collateralized Debt Obligations or CDO’s) fall dramatically.   Since they are highly leveraged, the investors have to come up with additional cash, typically lots of it.

3. That is, in an oversimplified nutshell, what is causing the significant sell offs in the stock market and the bond market at the same time.  Investors, typically hedge funds, are needing to raise cash and to do that they are selling everything.

Now keep in mind how bonds and mortgage rates work.   They actually move in reverse from each other.   When bond prices go down, bond rates go up and vice versa.

So, when everyone is selling bonds, that sends bond rates (and correspondingly mortgage rates up).   Which creates the reverse spiral that we don’t need.

The way it should be:
Step 1 – Housing market softens and economy softens
Step 2 – Inflation risk lessens
Step 3 – Long term rates drop
Step 4 – More people buy houses, cars etc.
Step 5 – the Housing market and the economy improve.

The way it’s happening right now:

Step 1 – Housing market softens and economy softens
Step 2 – Inflation risks lessen
Step 3 – Rather than long term rates dropping, they stay elevated due to the overall stresses in the economy and the need for overly leveraged investors to meet margin calls and raise cash.
Step 4 – The Housing market limps along with out a lot of movement.
Repeat Step 4 over and over and over again.

I’m convinced that if the overleveraged problems that are in the economy and the markets right now were to “disappear” we’d see long term rates drop quite substantially.   That would then encourage more people to step out and buy a new house.   That would in turn improve the housing market which would increase the value of the mortgage backed securities (because less people would be “under water” on their houses).   That would then reduce the need for people to meet margin calls and sell their investments.

See what an incredibly tangled web we have weaved?  (Is that the correct grammar?)   I’m not too much of a betting man, but if I were, I’d bet you that Treasury Secretary Paulson and Fed Chairman Bernanke and their staffs are currently working on trying to break that cycle.   I wish them luck because I don’t know how to break it.

Now, did you guess who had which earnings (losses?)

$81,000,000 loss – Fifth Third
$700,000,000 loss – National City – by the end of the year, they will be owned by PNC
$23,900,000,000 loss – Wachovia – by the end of the year, they will be owned by Wells Fargo
$4,370,000,000 profit – Microsoft

I’ll continue to keep you informed, let me know if I can be of help.

Tom Vanderwell

Two weeks to BloodhoundBlog Unchained in Orlando: Learn how low-cost prospecting techniques can help you dominate in 2009

I gather through the grapevine that the NAR Convention is shaping up to be a somber if not quite funereal event. Travel budgets are much constrained. That’s understandable. I can’t see a cost-benefit payoff of going to yet another vendorfest.

But BloodhoundBlog Unchained in Orlando is another basket of oranges. We are about nothing but teachable tools, tips, tricks, tactics and techniques that you can use to start snagging new business right away. Even better, most of the things we talk about are highly-leveraged: Minimum expenditure, maximum results. If you’re a Realtor or lender running in survival mode, we’ll show you how to get more bang for fewer bucks — right now.

If you’re coming to Orlando anyway — or if you already live in the Southeastern United States — make time for us. We’ll show you how to make more money for yourself.

Click on the PayPal button shown below to get your $99 ticket for BloodhoundBlog Unchained in Orlando on Friday, November 7th, 2008

When: Friday, November 7th, 2008, 8 am to 8 pm

Where: Crowne Plaza Hotel and Conference Center, Orlando Airport, 5555 Hazeltine National Dr, Orlando, FL 32812

See you in two weeks!

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The Last Vestige of Respect… Gone

With a little over a week to go in this election, we can finally all come together in agreement on one issue.  Whether you are voting for McCain: the logical vote, or voting for Obama: the emotional vote, or voting third party: the non-viable vote (unfortunately) – one thing has become clear.  The mainstream press has given up all pretense of being unbiased in their coverage.  They are blatantly shilling.  Whether we like the candidate they are whoring for or not, any respect we could have is gone.  The fourth estate has lost all legitimacy.

This final nail in the coffin was delivered by CNN earlier this week.  By all accounts, CNN has been as neutral as possible during the election.  They appear a little left of center by most accounts, yet they have been relatively even in their coverage.  What respect they deserved is now gone too.  On Tuesday night, Drew Griffin interviewed Governor Sarah Palin.  Watch the video at about 1:25 in and listen to the question Mr. Griffin asks of Governor Palin.  She is visibly shaken by it:

Now please read the actual paragraph that Mr. Griffin is quoting from the National Review.  It was written by Byron York (not a difficult fact to find out Mr. Griffin) :

Watching press coverage of the Republican candidate for vice president, it’s sometimes hard to decide whether Sarah Palin is incompetent, stupid, unqualified, corrupt, backward, or — or, well, all of the above. Palin, the governor of Alaska, has faced more criticism than any vice-presidential candidate since 1988… (full article here)

The first and last lines change the meaning a little don’t you think?  To say Mr. Griffin quoted Mr. York to Governor Palin out of context would be an understatement. The National Review article now has an Editor’s Note that reads in part:

Editor’s note: Byron York’s recent article in National Review on Sarah Palin’s time as governor of Alaska became a campaign issue Tuesday when CNN’s Drew Griffin distorted its meaning in a high-profile interview with Palin.

You can, of course, Google all of this and you can read people’s outrage.  You can even see the National Review author himself express dismay that his words were so misconstrued.  But what you won’t read anywhere (at least at the time this is posted) is a retraction or apology from CNN.  Apparently, they are content with their journalistic integrity… and that is the saddest comment of all.


Praise the lord and pass the ammunition; I am Joe the Plumber and another perfectly good election year is ruined by politics.

My turn.

I feel compelled to try to make some sense of politics in public. Am I not a blogger? And this being a big bad ass blog on which I can write anything that tickles my fancy, and yes my fancy got tickled by this election, I’m going to give it a shot.

So okay then. Thanks for that.

I’m looking back at the year. I love a good political year, and in January I figured this would be a damn good one. The Republican nomination was up for grabs, I love it when that happens, and the Democrats had some history making candidates, but most importantly, my kids were paying attention, and for that I thank Barack Obama. He wasn’t a grumpy old man, he was young and energetic and hopeful and he knew how to give a rousing speech. I think hope is good. I think eloquence is good. I think both together are very good.

Then John McCain chose Sarah Palin as his running mate, and I thought it was interesting, if nothing else. History is being made and I’m living to see it. I was hopeful that Palin would bring something different to the table this time around. I had hope that this election, these candidates, this new media world, this go ’round, we might see an elevated campaign. A campaign that followed the high ground and brought the dignity and integrity that We the People deserve.

Alas, and alack, it’s not to be.

I’m uninspired by John McCain and anything I’ve heard him say. Palin is, ya know, Jane Six Pack. I worked with her, at least I think it was her, during elementary school PTO fundraisers, you betcha! She’s not without charm, and she’s a she, but mostly that ticket is kinda more of the same, only not, only yeah, it is the same.

Biden. Well I must admit that he’s not let me down because Joe’s been Joe since I was a sprout, and he’s definitely Joe now, only he’s not a Joe the Plumber kind of Joe. No, Biden is a Joe the Politician kind of Joe. I am Joe the Plumber, by the way.

And that remarkable Obama eloquence that was so uplifting in January, cuts deeply at this point, and I’m angry. I am a Midwesterner after all, and according to Obama, I “get bitter-(I) cling to guns or religion or antipathy”.

Is it over yet?

So at this late date I’m undecided and for the first time in the 30 years that I’ve been voting I’m considering staying home on election day. Perhaps Obama is right about that antipathy thing?

I would like to take this opportunity to congratulate all the candidates, the staff, the journalists, and the talking heads, for turning what could be and should be a glorious exercise in democracy, into a race to the lowest ground. And pardon me while I praise the lord and pass the ammunition, but this bitter Midwesterner is thinking that in spite of the audacity of hope and the faith of my fathers, another election year has gone to hell.


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