There’s always something to howl about

Archive for August, 2009

Fishing for the details takes all the fun out of real estate fish stories

“You won’t believe the deal my buddy got on his house. He paid thirty cents on the dollar!”

“You’re right. I don’t believe that.”

“I’m not fooling with you. The house was worth $300,000, and he picked it up for a hundred grand.”

“It was worth $300,000 when?”


“He got it for $100,000 in what condition?”


“The house might have been worth $300,000 four years ago. And it might have been in great condition back then, too. What was the list price when your friend put the house under contract?”

“It was listed at $97,500. But the original listing was for $300,000!”

“I don’t doubt it. A lot of homes have been on the market for years. What kind of shape was it in when your friend saw it for the first time?”

“It was great! I mean, there were some holes in the walls, and some of the doors were missing. But it just needed some touch-ups on the paint. And the carpets were hardly stained at all!”

“What was the kitchen like?”

“Cherry! All it needed was a range, an oven, a dishwasher, a microwave and a fridge.”

“In other words everythng but the kitchen sink.”

“No, that was gone, too. But the counters and cabinets were in great shape, just missing a few knobs.”

“So some nice folks bought more home than they could afford during the housing boom. They couldn’t make their payments, so they put the home on the market for more than it was really worth, even back then. It sat on the market for four years, through a normal listing or two, through a short-sale listing, and then it finally sold to your friend as a lender-owned home. Is that about right?”

“You bet! He got a smokin’ deal!”

“Except he didn’t pay thirty cents on the dollar, he paid $2,500 over list.”

“Oh, whatever. Did I tell you about the trout I caught last week at Lake Pleasant? I swear, it was bigger than my arm!”

“Now that I believe.”

Steal this book: If you want to use this column on your real estate weblog, feel free. Just give me a link back to


I’ve got friends in Loan Places…

Radio Announcer: Don’t touch that dial! It’s time for crying, loving or leaving. And this first song has it all! It’s Jessica Horton with her debut song, “I’ve Got Friends in Loan Places” from the album: “If Tomorrow’s Closing Never Comes (The thunder is gonna roll!)”.

Blame it all on my buyer
Even if you’re a crier
Who doesn’t like to answer his phone.
The first one they called,
The first message they left
You were the last one
to explain about financing a home.
And I heard the surprise
And the hurt in your voice
When they went to the very next name
And that lender came through
Said, buyer, “This we can do!”
No, you’ll never hear me complain…

’Cause I’ve got friends in Loan Places
Where phones are on after 5:00.
And chances are never wasted
My buyers credit is more than ok…
I’m not big on your excuses
Facebook said you were busy taking cruises
Oh, I’ve got friends
in loan places!

Well, I guess you were wrong
People won’t wait too long
But then again, neither will you
Everything’s ok
Things get in the way
And, you had places to go’oh
Hey, I didn’t mean
To imply that you’re green
Just answer your phone and then…
Well, I’ll keep on sailin’
Like that cruise ship captain
That you’re currently on…

’Cause I’ve got friends in Loan Places
Where phones are on after 5:00
And chances are never wasted
My buyers credit is more than ok.
I’m not big on your excuses
Facebook said you were busy taking cruises
Oh, I’ve got friends
in loan places!

Radio Announcer: Love that song! Just love it! Next, it’s an oldie but goodie: Harper Valley B.O.R. – A song about real estate agents all up in each others business, and it goes something like this…

Album Credits: I would like to thank God. My husband. Mom & Pop and my cousin Earl and Aunt Lou. And, a special shout-out to all lenders: Thank you for your cookies – my kids loved them! However, if you’re looking for the quickest way into my heart, it’s through my ears and not my stomach! I love to hear, “Jessica, I called such and such lender on your list and they answered the phone and took my information – right there on the spot! Thank you for telling me about them! They are going to be great to work with! They said I can afford this much….”

Now, that’s music to my ears! Just answer your phone and you’ll go down in the Hall of Fame with this country girl!


Hey Zillow, hey Trulia, hey SmarterAgent: Here’s what I really want in a smart-phone app…

Not for me — for our lenders

Until lately, lenders and title people never really lived in our world. You could get ’em on the phone all day long — so long as it wasn’t Sunday, so long as it wasn’t 9:30 at night.

That’s changing, thank goodness, especially with lenders.

But: If I need a Loan Status Report (that’s Arizonan for a pre-qual form) at 9:30 on a Sunday night, I need it.

So here’s what I want for one (or more) of y’all to make for lenders:

1. Give them whatever kind of pre-qual calculator they need — with internet access, of course.

2. At the lender’s option, issue the pre-qual information in any extant state association of Realtors form, along with something generic and an auto-generated cover letter.

3. Email as a PDF or send an e-page with a URL to a PDF on your server.

As dumb as these forms are, and as perniciously useless as they sometimes can be, it’s getting to be impossible, in Arizona at least, to submit a contract without one.

So: If you would, please make it easy for lenders to make loan commitments.

Feel free to charge ’em for the app, of course. We all know they’re loaded… 😉


The Fed Translated – and why it isn’t good for interest rates…..

My apologies for taking almost 24 hours after the Fed to get this up.   As I’ve done in the past, I want to go through what the Fed said yesterday and give some insights into what I think it means for the housing and mortgage markets.   You can find the entire FOMC statement at Federal    As usual, my comments will be inserted inside the statement and will be in bold and italics.   Here goes:

For immediate release

Information received since the Federal Open Market Committee met in June suggests that economic activity is leveling out. I think it’s important to notice that they didn’t say things are improving, just leveling out.   The Fed never uses any words without a reason. Conditions in financial markets have improved further in recent weeks. Household spending has continued to show signs of stabilizing but remains constrained by ongoing job losses, sluggish income growth, lower housing wealth, and tight credit.  I think that what they mean by household spending is stabilizing is that people have slashed and burned their budgets down to the minimum and aren’t cutting back further.   However, if you look at the Retail Sales Report this morning, it raises a question of whether household spending is stabilizing. Businesses are still cutting back on fixed investment and staffing that’s a nice way of saying jobs are still being lost but are making progress in bringing inventory stocks into better alignment with sales. inventory in better alignment with sales – what that really means is that the jobs that “make things” are still being eliminated. Although economic activity is likely to remain weak for a time a time – that’s a nice way of saying we’re in for a long slow climb back, the Committee continues to anticipate “continues to anticipate” is that sort of like, “Please, please please, I really really want it?” that policy actions to stabilize financial markets and institutions, fiscal and monetary stimulus, and market forces will contribute to a gradual resumption of sustainable economic growth in a context of price stability.  They have had this sentence in there for a substantial length of time.    The longer that they put it in their statements, the more “hollow” it sounds.   Rather than being very confident, it’s starting to sound a bit more like, “We think we did everything right, now we just need to wait and see if the patient will recover.”   Oh wait, it’s 6 months and he’s still in a coma.

The prices of energy and other commodities have risen of late. However, substantial resource slack resource slack is a nice way of saying that we’ve got way too many production facilities and the demand isn’t nearly as high as the available supply is likely to dampen cost pressures – if there are 20 suppliers who are looking to make enough of something that could be done by 16 of them, the 16 that got the work can’t raise prices and the Committee expects that inflation will remain subdued for some time.  For some time – yes, it will.   In my mind, inflation and correspondingly interest rates will remain low for 12 to 18 months.

In these circumstances, the Federal Reserve will employ all available tools to promote economic recovery and to preserve price stability we haven’t put any of our tools back in the box yet.  We’re ready to use them if they need to.. The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period. As previously announced, important words – this isn’t something new, it’s a restatement of what they have done, to provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal Reserve will purchase a total of up to $1.25 trillion of agency mortgage-backed securities and up to $200 billion of agency debt by the end of the year. In addition, the Federal Reserve is in the process of buying $300 billion of Treasury securities. To promote a smooth transition in markets as these purchases of Treasury securities are completed, the Committee has decided to gradually slow the pace of these transactions and anticipates that the full amount will be purchased by the end of October. 

This is the only real change in the whole thing – they were supposed to be done in September but what they are saying is they will take the rest of August’s purchases and Septembers and spread them out through the end of October.  Now ask yourself, if they anticipated that the wind down of their purchases would have either a good or non-market moving effect, they would have finished up like planned in September.   But they didn’t, they said, “we need to spread it out over an extra 30 days to “mute” the impact to the market.   What sort of impact?   Let’s look at it this way:   If there are 20 buyers and 20 sellers, the demand and the supply is in balance.   If there are 20 sellers and suddenly 1 of the buyers, a relatively big buyer, says, I’m not going to buy any more, things get out of whack.   That means that most likely interest rates on Treasuries are going to go up.   And if interest rates on Treasuries is going to go up, what’s the most likely outcome for mortgages?   If you said, that they’ll go down, you’re wrong.

Now ask yourself, the Fed is buying $1.25 Trillion in mortgage backed securities from Fannie and Freddie.   What do you think is going to happen when those purchases are done?   Yep, higher rates again.

The Committee will continue to evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic outlook and conditions in financial markets. The Federal Reserve is monitoring the size and composition of its balance sheet and will make adjustments to its credit and liquidity programs as warranted.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Charles L. Evans; Donald L. Kohn; Jeffrey M. Lacker; Dennis P. Lockhart; Daniel K. Tarullo; Kevin M. Warsh; and Janet L. Yellen.


Am I being Paranoid about what the NAR is calling the “Recovery?”

Our helpful friends at the NAR have apparently sent out press releases about the increase in home sales in the second quarter being a sign of a “recovery.”

I saw this on MSN today (yes, I look at MSN):

WASHINGTON – U.S. home sales grew in the second quarter in 39 states, another sign that the ailing housing market is finally coming to life.

Total quarterly sales rose 3.8 percent to a seasonally adjusted annual rate of 4.76 million, from 4.58 million in the first quarter, but were still about 3 percent below a year ago, the National Association of Realtors said Wednesday. – MSN Home sales grew in second quarter in 39 states

Don’t get me wrong, I’m all for a recovery.  I would love to see a recovery.  Did I mention that really strong sales would be great?  The issue for me is that sales that are still 3% below a year ago doesn”t look like a recovery to me.

Yes, sales are higher than the first quarter of 2009.  However, around here, second quarter sales are always higher than first quarter sales.  I would wager that third quarter sales will be above second quarter sales, as always, too.  But that doesn’t mean they will be above the third quarter of last year.

Help me here, what am I missing?  With help like this from the NAR, it’s no wonder folks don’t trust Realtors.


Introducing Tony Gallegos: The Mortgage Cicerone as guide dog

Joining us today is mortgage expert Tony Gallegos. You’ve known him for years as The Mortgage Cicerone. Tony has just left the cloistered confines of corporate lending and struck out on his own. As a secondary benefit of making this move, he promises to tell BloodhoundBlog readers the unvarnished truth about the world of mortgages.

He’s been a friend of BloodhoundBlog for a long time, and he’s personally acquainted with quite a few of the dogs, so I know y’all will have no trouble making him feel welcome.


Makin’ Impressions — Being a Pro — Oh, and Lookin’ the Part

I’ve learned to expect a lackadaisical attitude about what makes a pro in the real estate business. What’s been surprising is the way something as basic as physical appearance has seemed to be unrelated to any particular generation. I’m talkin’ about how agents choose to dress while on the job.

So much is said, often with the stentorian tone and diction reminiscent of Charlton Heston’s role as Moses. “It’s all about being professional.” “The public is looking for the agent who ‘gets it’ — somebody who is a real pro from A to Z.”

Blah blah blah.

Look, I get it about untenable summer weather. I’ve been in Phoenix in August. It sucks like a turbo charged Dyson. But correct me if I’m wrong, agents in hot climes don’t have client conferences, sign contracts, or meet with prospects in the middle of the Costco parking lot at 1:30 in the afternoon. It’s my guess they’re meeting, if not in the office, somewhere the wonderful invention of air conditioning is in use.

You wanna make the impression on folks you’re a pro? Act like one. Have an office like one. Dress like one. Behave as if a bored housewife couldn’t do your job just as well with 13 hours training. Pretend you actually understand why the public sees real estate ‘pros’ in general as not professional at all. The level of denial I’ve observed both off and online is scary when it comes to this stuff. I’m sure there are jeans support groups.

Casual Friday? How ’bout Casual Decade?

A professional real estate broker/agent with a tie on, meeting a prospect in a well appointed office, demonstrating obvious knowledge, experience, and expertise, is perceived as a real estate professional.

I used to love it when I worked for several years in a huge national office. My office was designed by a pro. I was always professionally attired. When you arrived you were greeted by a very well dressed assistant, and led to either my personal office or a larger conference room if necessary. By the time a prospect had been in my office for 10 minutes there were at least several questions that were never gonna be asked. Why? Because they were answered by the professional atmosphere in which they were immersed, which was then congruently underlined as I entered the meeting dressed the way a pro should be dressed.

You may argue, as so many do, that this is too Old School, that the public simply doesn’t respond the way they used to. To repeat one of my favorite sayings — print that little speech out, shred it, and sprinkle liberally on your lawn. You’ll have the greenest grass in your neighborhood before you know it. What a buncha crappola.

Are there exceptions to this on a kinda sorta cultural level? In some places I’ve done business I’ve literally been warned not to show up at speaking engagements or seminars wearing a tie. Fair enough — I get it. But that’s anomalous in my 40 years in the biz. The vast majority of Americans have an idea of what that may not be entirely focused, but like a lotta things in life — they sure know it when they see it.

Why do so many force themselves to prove to folks how really professional they are by showing up at a black tie event with a polo shirt and brown shoes? I’m a live and let live kinda guy, so don’t read any self righteous indignation or animosity here, as it really just boils down to my own experience, how I was first trained, and simple observation of others. Also, watching those I’ve mentored see how folks react differently when they don’t dress like corn farmers havin’ lunch at the local cafe has reenforced this belief countless times.

I’ve made minimum wage type money, and I’ve made a whole lot more. Funny how when you talk like a pro, work in an impressive yet understated professional looking office, and actually dress professionally, the public jumps to the conclusion you just may be a pro.

Go figure.

Again, it’s not my intent to offend anyone. Congruency is part and parcel of the image everyone’s been giving lip service to the last few years. Yet the same loud voices complaining about part time soccer moms with licenses meet prospects for the first time as if they’re pickin’ up Aunt Evie at the airport. Pick one, will ya?

Pros dress like it. They carry themselves like it. Their countenance loudly proclaims their consummate professionalism. It’s very analogous to the oft used “If it quacks like a duck” saying. A new prospect sees you dressed like you’re goin’ to the ball game, and in their mind, even if it’s only subconsciously, they’re waiting for you to do something, anything that smacks of professionalism, instead of offering them a hotdog and some peanuts.

Complain all ya want about your perceptions of what’s wrong with real estate, we all have our list. But please — realize you’ve lost business because of your lack of professional attire — I guarantee you have. And because you never knew it was happening in real time, you sit in your ignorance swearing it’s never happened.

I thought that way once too — when I was 17. Thank God I was trained to know how important it is to look like a pro as well as operate like one.

Again, live and let live — but you know I’m right.


Why Withhold Addresses for Internet Display?

What’s going on in Long Island?

Over the past week, we noticed that 66% of Long Island listings require prospective home-buyers to register on a website before seeing the address.

Why would a listing agent do this? These homes get 42% fewer online viewings on Redfin, and are on the market 54% longer.  And any listing that requires registration to show an address can hardly be found on Google.

It doesn’t make any sense. Perhaps some clients want privacy. But that can’t be the only reason. It seems like in most cases, rather than having to deal with every Tom, Dick and Harry off the Internet, listing agents decided to try to find a buyer through their own network, perhaps so they could earn both sides of the commissions.

We’ve seen a similar phenomenon in San Diego, where about 12% of listings aren’t published to the Internet at all. Is inventory-hoarding what’s really at work? What are the situations where limiting or entirely withholding Internet publication would increase sales?

I used to be more willing to concede that it might not matter much at the very high-end — where buyers may be more likely to handle everything face-to-face — but lately we’ve seen foreign investors browsing our site from Asia before coming to the U.S. to put millions in capital to work.


The National Association of Realtors, in perfecting the idea of Rotarian Socialism, not only sanctified the criminal violation of the property rights of innocent people, it also robbed us of the highest and best uses we might have achieved with our real property…

Kicking this back up to the top because it fits so well with the recent posts from Al Lorenz and Doug Quance. –GSS

I’ve understood since I was 18 or so how real estate develops organically, in a truly free market, so I have known all my adult life how horribly the real estate market has been disrupted by the idiotic intrusions of Rotarian Socialism. It’s all about who can steal a few bucks by strong-arming his neighbors, and no one ever stops to wonder what gets mucked up in the process.

So: I said:

tell me in twenty-five words or fewer why relatively fungible non-commercial real estate should ever be thought of as an investment.

And Brian Brady said, in a comment to that post:

When it’s a 1-4 unit property, held for investment purposes.

Ten words. What am I missing?

What he’s missing is the definition of commercial real estate. If Brian owned 1-4 rental tuxedoes, should he call that his personal wardrobe? Just because the tax laws engender dumb distinctions, we don’t have to ignore reality, do we? Rental property — including a solitary rental house — is commercial real estate. It is owned in pursuit of profit, not as the residence of the owner.

So again:

tell me in twenty-five words or fewer why relatively fungible non-commercial real estate should ever be thought of as an investment.

The answer is that it should not. Hundreds of thousands of elderly people are going to suffer because — at the bidding of the National Association of Realtors — they took their eye off the ball. There is nothing rare about a tract home. If it gains in value ahead of other consumer goods, there has to be a cause — usually one that originates in the criminal use of force against people innocent of all wrong-doing.

As we have discussed, the precipitating cause of the real estate boom in the southwest was criminal land-use restrictions in the costal metroplex of Southern California. The land there is not inherently scarce, but governments made its development difficult or impossible, driving prices up faster than they would have gone otherwise. Investors falsely believed that their gains were demand-driven, so they took the boom to cities with abundant land and no significant land-use restrictions — Riverside County, Sacramento, Las Vegas, Phoenix, etc. — causing massive overbuilding in those markets.

If we had a truly free market in real estate — if government kept its nose out of private property issues, including transportation, and if taxes were zero or something very close to zero — ordinary housing would not gain or lose value any faster or slower than clothing or shoes or any other semi-durable utilitarian goods.

Away from significant historic and architect-built homes, and away from extremely non-fungible land like Malibu Beach or Camelback Mountain, housing should tend to lose value as it ages, with the move-up process into newer homes being a status symbol of the wealthy. This is the way things worked in all the cities of Europe and America prior to the twentieth century — when the NAR perfected Rotarian Socialism.

The interruption of this organic process of hand-me-down housing is the essential cause of homelessness, just as an illustration of how far-reaching are the consequences of the criminal use of force against innocent people. And, of course, almost all of us live in structures that are shoddy and widely-separated, with almost nothing of the kind of metropolitan urbanity we associate with cities that developed before governments criminalized commerce.

The fact that the once freedom-loving American people fell deeply in love with the use of force against innocent people is not solely the fault of the NAR, but you can bet those Babbits had their hands in the till every step of the way. Zoning makes our cities bland and stupid, but “free” roads make them ugly and unmanageable. We have strayed so far from the idea of capitalism — no matter how much we denounce the consequences of Rotarian Socialism under capitalism’s name — that we actually forget the first principle of capitalist enterprises: They must show a profit.

Since Rome, at least, roads have not been privately owned, but a profit-seeking road would not be built on a whim, as a politically-favorable connection between two equally-unprofitable farms, for instance. A profit-seeking road would surely serve many disparate profit-seeking purposes, perhaps so many that you might not identify it primarily as being a road. A real road is real estate, and access to goods and services and delivery of goods and services are all intermingled on what is, in fact, a full-blown linear bourse.

I am famously opposed to taxpayer-extorted mass-transit boondoggles, but these idiotic swindles only exist because the NAR and other Rotarian Socialists have so successfully made war on the ideas of freedom and private property. Do you see? If all real estate development has to show a profit, structures will be a lot more vertical and our footprint on the land will be a lot smaller. In that circumstance, virtually all personal transportation would be undertaken by the best mass transit system ever devised — cheap in capital costs, non-polluting and with salutary health benefits for every patron. What is it? It’s called walking — something that can now only be done in cities that were developed before governments started pushing innocent people around at gunpoint.

One of the things we love about the internet is that it connects people with incredibly arcane interests, but this is also a function that was once common in cities, before they were redrawn as vast collections of strip malls and wedding-cake houses by the NAR.

I could go on forever, but there’s no real point to it. We paved paradise to put up a parking lot, and we not only didn’t learn our lesson, we’re hell bent on sliding ever closer to full-blown totalitarianism. There is no one who has ever been to the Department of Motor Vehicles who can claim not to know what to expect when medical practitioners are enslaved. And yet off we go, like lemmings in lockstep, swearing to anyone who will listen that the smartest people we will ever know are going to take orders from morons with guns.

We live in horror of freedom, and we will stop at nothing to eradicate it from the earth. We will finally manage to build vertically when, like the Nazis and the Communists before us, the murdered bodies of our neighbors and friends, brothers and sisters, parents and children start to pile up. And in that light, it seems kind of silly of me to maunder about what might have been in real estate development.

But still… When you’re wandering through The City in London or through the Battery in New York or The Loop in Chicago, when you find yourself wondering why those old towns are so vibrant and vital and fun and why modern cities are so boring, so draining, so forgettable — the answer is the difference between freedom and force.

It took a hundred years for the NAR and its fellow Rotarian Socialists to screw up America, and, unfortunately, that’s a process that rages on apace. But if you could imagine our reversing course, it would probably take two or three centuries to undo all the damage. Everything could be so much better than it is — and we haven’t even talked about the compound-interest value of all the opportunity costs associated with systemic, epidemic criminality in government. But, for a start, everything could be so much better in real estate…


It is time for a new Civil Rights Movement

After seeing all the fuss over Doug Quance’s post about A Governmental Takeover of Real Estate Brokerages, I thought a more thorough answer from my perspective to his question might be appropriate.  Last week, a couple of sentences from a superb article by Yaron Brook at the Ayn Rand Center literally twisted at my thoughts.  The sentences are:

  • Rights, as the Founders conceived them, are not claims to economic goods, but to freedoms of action.
  • The rights of some cannot require the coercion and sacrifice of others.

Those sentences are basic premises of the Constitution, of human dignity and of what freedom and liberty are based on.

But apply those thoughts to the current maelstrom swirling about health care, and one’s “right” to health care has a wholly different meaning.  In Mr. Brook’s own eloquence:

The solution to this ongoing crisis is to recognize that the very idea of a “right” to health care is a perversion. There can be no such thing as a “right” to products or services created by the effort of others, and this most definitely includes medical products and services. Rights, as the Founders conceived them, are not claims to economic goods, but to freedoms of action.

You are free to see a doctor and pay him for his services–no one may forcibly prevent you from doing so. But you do not have a “right” to force the doctor to treat you without charge or to force others to pay for your treatment. The rights of some cannot require the coercion and sacrifice of others.

Real and lasting solutions to our health care problems require a rejection of the entitlement mentality in favor of a proper conception of rights. This would provide the moral basis for breaking the regulatory chains stifling the medical industry; for lifting the tax and regulatory incentives fueling our dysfunctional, employer-based insurance system; for inaugurating a gradual phase-out of all government health care programs, especially Medicare and Medicaid; and for restoring a true free market in medical care. –

Our entire national debate is absolutely perverted.  People speak of “rights” that are nothing more than stealing other people’s sacrifice.   Our government forces others to pay for the mistakes of automobile company executives, unions, banks and insurance companies.  On our sweat and labor, others are given a pass for their mistakes.  Stimulus, primarily benefitting the political base of a single political party, taking your labor, your breath, your sacrifice to give ACORN $8.5 billion of your dollars so they can create more political mayhem to further enshrine their ability to take even more in the future.

Your labor and sacrifice is being forcibly taken by your own government.  This is nothing if not a new slavery, not of a people to wealthy plantation owners, but of a nation to wealthy ruling elites determined to fleece the populace of their prosperity.  Are politicians, many of whom are lawyers, speaking of cramming down fixed rates for services for the legal “right” to representation that everyone “should” have?   Of course not.  Certainly, if you need it, legal representation can be just as important to your life as a root canal and just as much fun.

We had the right to freedom of our actions.  We had the right to prosper from our own labors and sacrifice.  We had the right to the limited government our ancestors created. Yes, we even had the right to fail and learn from our failures. These are the same rights that were fought for in the Revolutionary War, again in the Civil War and are the basic rights that were sought in the first Civil Rights Movement.

Just because they are rights doesn’t mean they are free. Unlike the discussion going on about health care where a supposed “right” is free to some or many at great cost to others, the rights I want back don’t come at a cost to others.  To keep and reclaim our rights we need to take action like those before us.  We need a new public movement to take back our Civil Rights.

These civil rights movements are already happening around the country under various names.  Tea parties are one example.  I don’t know what history will eventually name this movement, but it is all about the same civil rights that Americans have fought for in the past.  Freedom of action, thought and communication and freedom to enjoy the fruits of our labor are what this is all about.

Last November a nation’s freedom was unwittingly given up due, in part, to the people’s own ignorance of what they were doing.  The argument for taking that freedom back peaceably is a moral one.  That argument can easily stand up to anyone’s argument to the contrary about their “right” to health care or their right to take over your business.  Doug, if the government tries a governmental take over of real estate brokerages, it is our obligation to speak out until we stop it.


Dear NAR… (If you really wanna help?)

Maybe run this as an ad on prime time Tv. I’d say every night, for 30 seconds, from now till Nov 30?


From The Gift of Fire, by Richard Mitchell: Who is Socrates, Now That We Need Him?

Quoted from Mark Alexander’s wonderful Richard Mitchell web site:

When Benjamin Franklin was hardly more than a boy, but clearly a comer, he decided to achieve moral perfection. As guides in this enterprise, he chose Jesus and Socrates. One of his self-assigned rules for daily behavior was nothing more than this: "Imitate Jesus and Socrates."

I suspect that few would disagree. Even most militant atheists admire Jesus, while assuming, of course, that they admire him for the right reasons. Even those who have no philosophy and want none admire Socrates, although exactly why, they can not say. And very few, I think, would tell the young Franklin that he ought to have made some different choices: Alexander, for instance, or Francis Bacon.

Jesus, just now, has no shortage of would-be imitators, although they do seem to disagree among themselves as to how he ought to be imitated. But the imitators of Socrates, if any there be, are hard to find. For one thing, if they are more or less accurately imitating him, they will not organize themselves into Socrates clubs and pronounce their views. If we want to talk with them, we will have to seek them out; and, unless we ourselves become, to some degree at least, imitators of Socrates, we will not know enough to want to seek them out. Indeed, unless we are sufficiently his imitators, we might only know enough not to want to seek him out, for some of those who sought Socrates out found reason to wish that they hadn’t. Unlike Jesus, or, to be more accurate, unlike the Jesus whom many imagine, Socrates often brought not the Good News, but the Bad.

Nevertheless, people do from time to time come to know enough about Socrates to be drawn into his company, and to agree, with rare exceptions, that it would indeed be a good thing to imitate him. The stern poet-philosopher Nietzsche was one of those exceptions, for he believed, and quite correctly, that reasonable discourse was the weapon with which the weak might defeat the strong, but most of us often do think of ourselves as weak rather than strong, and what seemed a bad thing to Nietzsche seems a good thing to us. However, when we do try to imitate Socrates, we discover that it isn’t as easy, and as readily possible to millions, as the imitation of Jesus is said to be.

So we make this interesting distinction: We decide that the imitation of Jesus lies in one Realm, and the imitation of Socrates in quite another, The name of the first, we can not easily say, but the name of the second is pretty obviously "mind." Even the most ardent imitators of Jesus seldom think of themselves as imitating the work of his mind, but of, well, something else, the spirit, perhaps, or the feelings, or some other faculty hard to name. But those who would imitate Socrates know that they must do some work in the mind, in the understanding, in the intellect, perhaps even in the formidable "intelligence" of the educational psychologists, beyond whose boundaries we can no more go than we can teach ourselves to jump tall buildings. We may apparently follow Jesus simply by feeling one thing rather than another, but the yoke of Socrates is not easy, and his burden not light, nor does he suffer little children to come unto him.

And we say that, while it would be truly splendid to imitate his example, it really can’t be done as a general rule for ordinary life. Very few of us are as smart as Socrates, after all, and the smartest of us are already very busy in computers and astrophysics. Socrates appeared once and only once among us, and the chances of his coming again are very slim. We may hold him up as a shining example, of course, but as a distant star, not a candle in the window of home. He is one in billions. So we must, it seems, resign ourselves to living not the examined life but the unexamined life, responding to the suggestions of environment and the inescapable power of genetic endowment and toilet training.

Nevertheless, millions and millions of us contemplate no serious difficulty at all in imitating the example of Jesus, who, as it happens, is also held to be one in billions. We do not say, Ah well, a Jesus comes but once among us, and we lesser folk must content ourselves with remembering, once in a while, some word or deed of his, and trying, although without any hope of truly and fully succeeding, to speak as he might have spoken, to think as he might have thought, and to do as he might have done. Sometimes, to be sure, provided that we do in fact understand him correctly, which is by no means always certain, we might come near the mark. But it is childish and idealistic to imagine that we can, especially in this busiest and most technically demanding of worlds, plainly and simply live as Jesus lived. No, we do not make those reservations, but suppose rather that, in the case of this one life among billions, we can launch ourselves, all at once, and as if by magic, into the Way in which he walked. And this is because we imagine that the Way of Socrates is barricaded by the wall of an intelligence test, and the Way of Jesus is not, that the regularly examined life requires a lot of hard mental labor, and that the good life is as natural and automatic as the singing of the birds.

But there was at least one man who held, and who seems to have demonstrated in a very convincing fashion, that Socrates was not at all special, that he was, indeed, just as ignorant as the rest of us. We can not dismiss him as a political enemy or an envious detractor, or even as a more "advanced" philosopher who had the advantage of modern information to which Socrates had no access. It was Socrates himself who made that demonstration. And, although Plato is surely the most humorous and ironic of philosophers, it is just not possible to read Socrates’ Apology as a witty trick at the jury’s expense. It is a sober autobiography. Socrates explains that he has simply spent his life in trying to discover what the god could have meant in saying, by an astonishing oracle, that Socrates of Athens was the wisest of men. Socrates had discovered, as he had expected, that he knew nothing, but also that the same was true of everybody else. The oracle meant, in effect, that the wisest of men was just as unwise as all other men. But we seem to be fundamentalists about the oracle. There is a curious contradiction in us when we say that Socrates is an inimitable one in billions because of the power of his mind, and thus deny the power of his mind to judge truly as to whether he was an inimitable one in billions. Our minds, which are not up to the work of imitating him, are nevertheless quite strong enough to overrule him. Strange.

In old age, Franklin admitted that his plan for the achievement of moral perfection had not entirely succeeded, and that he had not, after all, been able perfectly to imitate either Jesus or Socrates. But he did not say that such imitations would have been impossible, or excuse himself from them on the grounds that they would have been impractical or unrealistic, or even, as the modern mind seems very likely to say, that they would have been counterproductive and little conducive to success. He says that, all in all, while he was but an occasional imitator, even so he had thus lived a better and a happier life than he would have otherwise had. And I do suspect that Socrates himself might have said much the same, for he, too, was surely an occasional imitator of Socrates.

The Socrates we have in the dialogues of Plato simply must be a "perfected" Socrates, a masterpiece every bit as much artistic as philosophical. I have lived, and so have you, in this world, which is the very same world in which Socrates lived. Only its temporary particulars have changed. He did, if only when Plato wasn’t around, or perhaps before Plato was around, worry about money. He quarreled with his wife, and fell out of patience with his children. He spoke, and even acted, without considering the full meaning and probable consequences of his words and deeds. He even, if only once or twice, saw Reason clearly and completely, and went ahead and listened to Appetite instead. And once in a while, from time to time, he lost his grip on that "cheerful and temperate disposition" without which neither the young nor the old, neither the rich nor the poor, can hope for that decent and thoughtful life of self-government that is properly called Happiness. And such outrageous and unconventional charges I can bring–as can you–against Socrates or anyone, with calm assurance, for Socrates was just a man. To do such things, as he himself very well knew, was merely human.

So now I can see before me one of those persons whom I call, in a very strange manner of speaking, "my" students. There she sits, as close to the back of the classroom as possible. She is blowing bubbles with her gum, and not without skill. She intends to be a schoolteacher. She has read, in their entirety, two books, one about some very frightening and mysterious happenings in a modest suburban house on Long Island, and the other about excellence. I now have reason to hope that she has been reading Emerson, and she probably has. She is not a shirker, but, at least usually, as much a person of serious intent as one should be at her age and in her condition. Her understanding of Emerson is not perfect, but neither is mine. The essay she has been reading, I have read many times, and every time with the realization that my understanding of it, up to now, of course, has not been perfect.

I know this as surely as I know that Socrates was once exasperated by a yapping dog: Someday, perhaps this day, when I have explained some difficult proposition’s exploration by Emerson, that young woman, or somebody else very much like her, will raise her hand and ask the question, and ask it just as Socrates asked, out of what she knows to be her ignorance, and her desire not to be ignorant. And her question will remind me that I am ignorant, and that I didn’t know it, and that I do not want to be.

I probably give less thought than I should to the question of whether the world exists, but I often consider the question of when it exists. When I am there in class, considering that young woman’s question before me, that is the world. Socrates exists. As though she were Socrates, this blower of bubbles asks the question. She has never thought out or named "undefined terms," "unbounded categories," or "unexamined propositions." She can not say that a likeness should be noted where only difference was presumed, or a difference where only a likeness. But she can ask as though she had considered such things. And in that moment, in the world that then and there exists, who is the teacher and who the student? Who is Socrates?

If I have any good sense at all, will I not give her question as much thoughtful consideration as I would have given to the same question had it come from Socrates himself? And for two reasons, both of them splendid.

Rather than effectively dismissing Socrates when we suppose that we praise him as "one in billions," we might do better to attend to our words as though we were poets, looking always deeper into and through them. We could thus also say that Socrates is one who is truly in billions, the most powerful confirmation that we have of what is, after all, not merely an individual but a generally human possibility–the mind’s ability to behold and consider itself and its works. That power is probably unavailable to infants and lunatics, but, in the absence of some such special impediment, who can be without it? Can it be that some of us are empty, and without that power which is the sign of humanity? My bubble-blower certainly is not, and she is real. I have seen her often. And in that moment when she is Socrates, I may well be seeing the first moment of thoughtfulness in her life. Education, real education, and not just the elaborate contraption that is better understood as "schooling," can be nothing but the nourishment of such moments.

I imagine some well-informed and largely wise visitor from another world who comes to Earth to study us. He begins by choosing two people at random, and, since time and place are of no importance to him, but only the single fact of humanity, he chooses Socrates and me, leaving aside for the moment every other human being. He begins with an understanding of the single but tremendous attribute that distinguishes us both from all other creatures of Earth. We are capable of Reason. Capable. We can know ourselves, unlike the foxes and the oaks, and can know that we know ourselves. He knows that while we have appetites and urges just like all the other creatures, we have the astonishing power of seeing them not simply as the necessary attributes of what we are, but as separate from us in a strange way, so that we can hold them at arm’s length, turning them this way and that, and make judgment of them, and even put them aside, saying, Yes, that is "me," in a way, but, when I choose, it is just a thing, not truly me, but only mine. He sees, in short, what "human" means in "human beings."

And then he considers the specimens he has chosen, Socrates and me. He measures that degree to which they conform to what "human" means in "human beings." With those superior extraterrestrial powers that imagination grants him, he will easily discover:

That I have notions, certain "sayings" in my mind, that flatly contradict one another; believing, for instance, that I can choose for myself the path of my life while blaming other people for the difficulty of the path. With Socrates, this is not the case.

That my mind is full of ideas that are truly nothing more than words, and that as to the meaning of the words I have no clear and constant idea, behaving today as though "justice" were one thing, and tomorrow as though it were another. That, while wanting to be happy and good, I have no clear ideas by which I might distinguish, or might even want to distinguish, happiness from pleasure, and goodness from social acceptability. With Socrates, this is not the case.

That I usually believe what I believe not because I have tested and found it coherent and consistent, and harmonious with evidence, but because it is also believed by the right people, people like me, and because it pleases me. And that furthermore, I live and act and speak as though my believing were no different from my knowing. With Socrates, this is not the case.

That I put myself forth as one who can direct and govern the minds, the inner lives, of others, that, in fact, I make my living as one who can do that, but that my own actions are governed, more often than not, by desire or whim. With Socrates, this is not the case.

That I seem to have a great need for things, and think myself somehow treated unjustly by an insufficiency of them, and that this insufficiency, which seems strangely to persist even after I get hold of the thing whose necessity I have most recently noted, prevents in me that cheerful and temperate disposition to which I deem myself entitled. With Socrates, this is not the case.

That I seem to know what I want, but that I have no way of figuring out whether I should want what I want, and that, indeed, it does not occur to me that I should be able to figure that out. With Socrates, this is not the case.

And that, in short and in general, my mind, the thing that most makes us human, is not doing the steering of this life, but is usually being hustled along on a wild ride by the disorderly and conflicting commands of whole hosts of notions, appetites, hopes, and fears. With Socrates, this is not the case.

How could the alien enquirer help concluding that there is something "wrong" with me, and that the humanness that is indeed in me has been somehow "broken," which he can clearly see by comparing me with Socrates? Must he not decide that Socrates is the normal human, and I the freak, the distortion of human nature?

When he pronounces me the freak, and Socrates the perfectly ordinary, normal human being, living quite obviously, as perhaps only an "alien" can see, by the power of that which most makes a human a human, shall I defend myself by appeal to the principle of majority rule? Shall I say: Well, after all, Socrates is only one human being, and all the others are more like me. Would I not prove myself all the more the freak by my dependence on such a preposterously irrelevant principle? If that visitor were rude, he might well point out that my ability to see, on the one hand, what is natural to human beings, and to claim, on the other, that its absence is only natural, and thus normal, is just the sort of reasoning that he would expect of a freak, whose very freakishness is seen in his inability to do what is simply natural to his species–that is, to make sense.

But Socrates would defend me. He would say, for this he said very often:

No, my young friend is not truly a freak. All that I can do, he can do; he just doesn’t do it. And if he doesn’t do it, it is because of something else that is natural to human beings, and just as human as the powers that you rightly find human in me. Before we awaken, we must sleep, and some of us sleep deeper and longer than others. It may be, that unless we are awakened by some help from other human beings, we sleep our lives away, and never come into those powers. But we can be awakened.

In that respect, my friend is not a freak. He might better be thought a sleepwalker, moving about in the world, and getting all sorts of things done, often on time, and sometimes very effectively indeed. But the very power of routine habit by which he can do all that has become the only government that he knows. And the voices of his desires are loud. He is just now not in a condition to give his full attention to any meaning that might be found in all that he does, or to consider carefully how to distinguish between the better and the worse. He might be thought a child, and a perfectly natural child, who lives still in that curious, glorious haze of youth, when only desire seems worthy of obedience, and when the mighty fact of the world that is so very "there" looms immeasurably larger than the fact of the self that is in that world. He might grow up, and it is the "mightness" in him that makes him truly human, however he may look like a freak just now. From time to time, we are all just such freaks, and mindless, for mindlessness is the great background of noise out of which some few certain sounds can be brought forth and harmonized as music.

I am often worried and vexed about the colossal social institution of "schooling," of which I am a paid agent. My quarrels and complaint with schooling are beyond my counting, and also, I must admit, valid but trivial. Looming behind all of the silly things that we do in schools, and pass off as an "education" that would have startled Socrates, there is nothing less than a great, pervading spirit of dullness and tedium, of irksome but necessary labors directed completely toward the consolidation of the mundane through the accumulation of the trivial. In school, there is no solemnity, no reverence, no awe, no wonder. We not only fail to claim, but refuse to claim, and would be ashamed to claim that our proper business was with the Good, the True, and the Beautiful, and that this business can be conducted not through arousing pleasant feelings, but through working the mind. Thus it is that education is exceedingly rare in schooling, and when it breaks out, it is as the result of some happy accident, an accident that might have befallen a prepared mind, or maybe any mind at all, just as readily in the streets as in the schools.

Education makes music out of the noise that fills life. And from the random and incessant background noise of what we suppose the "mind," meaning really the appetites and sentiments, education weighs and considers, draws forth and arranges, unites the distant with the near, the familiar with the strange, and makes, by Reason, the harmonious music that is Reason. If we can know anything at all about How to Live, it is in Reason that we must seek it, for the only other possibility is to seek it outside of Reason, in the disorder of noise. I am convinced that Socrates is right, that anyone can make that search and decide, not what the Meaning and Purpose of Life is, but what the meaning and purpose of the searcher’s life should be, and thus to live better.


Read the complete works of Richard Mitchell — for free, which means you must be rich enough in wisdom to pay attention.


A Governmental Takeover Of Real Estate Brokerages?

An Extrapolation Of Epic Government Involvement

At this moment, the President and Democrats in both Houses of Congress are finalizing a health care reform bill that not only no one understands – it won’t  even be read by any of them prior to its passage.

The stated reason for this takeover is the spiraling cost of health care in this country. But health care costs are not the single largest expense that Americans pay for their existence. The single largest expense is housing.

While a majority of Americans are satisfied with their health care, the Democrats are in high gear to eliminate the health care system we currently enjoy – ostensibly to implement a system like Canada, the United Kingdom – or even Massachusetts. Many of these Americans are standing up against the Democrats in town hall meetings across the country.

But how many of  these Americans would stand up if the government chose to take over the real estate industry? After all, doctors and nurses are ranked in the top ten most prestigious careers in this country – while real estate agents and brokers are at the bottom of the list.

Think about it – an argument to nationalize housing could easily be more acceptable than the argument to nationalize health care. What would the cost of housing be if you could eliminate profit from the equation?

The largest single expense when selling a home is the brokerage fee, followed by the costs to obtain a  mortgage. What if these functions were performed by government employees with no profit motive?

Far fetched? The two largest purchases that most Americans make are houses and cars. And we all know who is now making the cars.


Grinders and Grinding

I wake up each morning listening to various radio programs, all sports talk shows with one exception. They’re interesting most of the time, and since there are three of ’em, I can rotate ’till one grabs me. Earlier this week it was ESPN’s The Herd I think. Colin Cowherd talking about the difference between West Coasters and East Coasters and Midwesterners when it comes to discipline. Though they tended to generalize far too much geographically, their point was well made:

Great talent almost always loses out in the long run to great discipline. And great talent yoked to great discipline is nearly unbeatable.

When asked for an example he cited a couple elite teams — the Colts and Patriots. Both are Super Bowl Champs. Both have won far more than their share the last several seasons. Besides winning, they share another factor — they have more players with college degrees than the other teams. Discipline.

He then used Cincinnati as an example of a team with incredibly talented players but almost no visible discipline. Apparently Cincinnati, when translated, means Pay more attention to Me Me Me!! I think anyone who follows pro football can see the merit in these examples, as I did.

Don’t immediately jump to discipline in real estate or the mortgage business, look back on other things you’ve done in your lives that wouldn’t have been remotely possible without it.

I’ve had three hobbies in my life in which I’ve been involved at fairly intense levels. Bodybuilding, baseball umpiring, and running.

Anybody who’s done any of those seriously, knows it involves what Cowherd called grinding — or being a grinder. It’s a perfect description in my opinion. All three of those disciplines require very long periods of both learning curves, practice, and the gaining of real life, real time experience. All three of those is a grind, and there’s nobody but you doin’ it. You lift the weight, you study the rules and apply the correct on-field mechanics, you log the miles each day.

It’s a grind — there’s simply no pretty way to dress it up, is there?

Colin’s point was that those from the east coast and midwest are raised in “Grinder” cultures. Every day they work at getting better, at doing what’s called for, what will produce results ultimately. They watched their dads go to the factory, or mill, or office every day as they grew up. They saw the rewards for faithfully grinding it out — day after day after day.

I remember conversations with Brian Brady about his years on Wall Street, Phoenix style. He spoke of the newbies hired by the big ‘houses’ and how they turned them into 50-80 hours a week cold calling zombies — talk about the poster children for Grinder. But like Brian pointed out, what they learned from those months, which sometimes turned into years of daily grinding on the phone, was that in the end, grinders end up plantin’ their flags at the summit.

Finally, if you’ve never really experienced the life of a grinder, think back to that kid you used to privately smirk at, whose dream was something for which you thought he didn’t have chance number one. He made it though, didn’t he? You bet he did. We all know folks like that. They toiled in the fields to which their goals led them — and before we knew it, they’d accomplished what nobody thought possible for them.

Whether you’re IQ is 100 or 150 — whether you’re hugely talented or can barely get out of your own way — become a grinder and find out how miracles happen. ‘Course, the truth is, the killer results produced by the grinders of the world aren’t miracles at all, any more than a farmer harvesting wheat in October is a miracle after all the grinding work he did from early spring on — day in, and day out.

You may wanna read this too.

Grinders rule the world.


Prometheus without forethought: Using the Bloodhound meme to bring clients around to a conversation about quality in real estate

My mind is alive with themes for BloodhoundBlog posts that I’m not writing — the Principle of the Yes Man and the Elephant on the Balcony and Prometheus the Mind-Giver. I’d write more, except my having written so much over the past three years is paying off in spades — in diamonds, as it were.

But in the comments to Chuck Marunde’s marvelous post on the ubiquity of the part-time Realtor, the idea of improving the quality of practitioners came up again.

We’ve been through all of this many times before, and a search of the archives on the terms “licensing” should prove enlightening. But this is the Cliff’s Notes on my own position on the topic: Licensing laws serve only to enshrine mediocrity by implying that minimum standards are adequate and sufficient. To the contrary, a higher standard of care among real estate professionals will be achieved not by stricter licensing laws, and not by the National Association of Realtors, but by the persistent application of market-borne pressure. In other words, a higher quality of service among real estate professionals will come about when superior practitioners raise the bar — and tell the world they have done so.

To which sentiment I will amend this addendum: Ahem!

This is the BloodhoundBlog mission, of course, and, at our third anniversary, I wrote about how proud I am that the word “Bloodhound” has become a de facto meme for quality in the practice of real estate.

And: Nothing exceeds like excess. Anything worth doing is worth over-doing. So I’ve made a little button you can put on your web site or weblog, if you like, to spark a Bloodhound-like conversation. That much is the Elephant at the Dining Room Table: Your clients aren’t thinking about quality because the state and the NAR have schooled them to look for meaningless imprimaturs instead. If you want for your clients to be able to identify the better from the worse, you have to initiate the conversation with them. The buttons you see below can help you get that discussion started.


160 pixels square:

We're Bloodhounds. We teach our clients to demand better service from real estate professionals.

125 pixels square:

We're Bloodhounds. We teach our clients to demand better service from real estate professionals.

To install the button of your choice, just select all the code within the text box and paste it in your sidebar or wherever you might want it to go. If you use the WordPress sidebar widgets, there are folks here who can tell you how to install a button like this in a widget.

To address the inevitable kvetching in advance: Yes, these buttons link back to here. Why? In order to let your clients know where they can go to see an uncamouflaged debate about high-quality service and representation among serious real estate professionals. We never forget the ninety-and-nine, and BloodhoundBlog is an outsized challenge to everything that has been substandard in the real estate profession. We want for our clients to see us here so that they can grasp how serious we are about raising the bar — and about chasing the bums out of our business.

Readers more contemplative may wonder if we are not diluting the Bloodhound meme by making these buttons available to anyone who might want them. This seems unlikely to me. To post one of these little badges is to promote the conversation the text of the button elicits. If you are not prepared to talk about going that extra mile, you would be ill-advised to raise the topic in the first place. But if you are prepared to do whatever it takes to get the job done right, you will do better for your clients and for yourself by taking on the elephant in the room without having to be asked.

Is this the ultimate solution to our problem? I’m sure not. But it is a preliminary tactic, a way to turn the marketing conversation in our direction. If we can spread the idea that quality is the only distinction that matters, in choosing a real estate practitioner, we will not only grow our own businesses, we will effect a permanent improvement in the real estate marketplace for everyone.

That’s a goal worth pursuing, don’t you think?


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