Chinese buying up California housing

[test]

"when you lose out on that purchase of a home to a Chinese buyer who bid 50% over asking sight unseen, with no intentions to ever move in, you will finally know why this is happening"
http://www.zerohedge.com/news/2013-...ion-new-liquidity-blew-bernankes-qe-out-water

 

[daedalus]

I will be terrified when the world evolves to a point that they have excess capital but choose to NOT buy US assets.  Let them buy the overpriced Rockefeller Plazas I say.

 

[morekaos]

Agreed...ask the Japanese what it's like to be on the sucker end of overpriced American real estate...this is no different

 

[irvinehomeowner]

So that's where all that gold iPhone money is going.

 

[morekaos]

starting to sound familiar to anyone?


http://articles.latimes.com/1990-11-14/business/fi-4309_1_u-s-real-estate-market


[size=18pt]Japanese Buying Spree in U.S. Slows :[/size]

Real estate: A study by Kenneth Leventhal & Co. sees a reduction in investment. It cites recession fears, Mideast worries and slumping stocks in Tokyo.

November 14, 1990|TERESA WATANABE | TIMES STAFF WRITER

They're not scrambling to sell yet, but Japanese ardor for U.S. real estate has definitely cooled amid fears of an economic recession, Mideast war and the plunge in the Tokyo stock market, a new report concludes.

In an interim report released Tuesday, Kenneth Leventhal & Co. has reduced its estimate of 1990 Japanese investment in the United States to a range of $10 billion to $13 billion, from a previous forecast of $13 billion to $16 billion. The new figure is below the 1989 spending of $14.8 billion and is projected to dip as low as $7 billion next year, which would be the lowest level since the certified public accounting firm began tracking Japanese investments in 1985.

 

[irvinehomeowner]

The big difference between Japan and China... money keeps pouring into China because that's where everything is made.

 

[daedalus]

The big difference between Japan and China... money keeps pouring into China because that's where everything is made.

Guess where the "cheap crap" was made back in the '60s and '70s.  My parents have fond memories of living in Japan as US employees back in the late 60s, when the exchange rate was 360 yen per dollar.  The big difference there was that technology and globalization of the time could not foster the same level of foreign investment that China has enjoyed, but it was there, and it's largely why Japan grew as much as it did through the 80s, despite being an island nation with virtually zero natural resources.  History does not necessarily repeat, but it does rhyme.  China will find its own path and it has no shortage of challenges, many worse than Japan ever had.  I've been there 3 times, the last as part of a "global studies" class that focused on domestic and international businesses.  The transformation I've witnessed between my trips, spaced 6 years apart, is simply phenomenal.  The people make 2x as much as they did 5 years ago and, though still very poor, are no longer the cheapest labor pool on the planet.  China has a lot of cushion with their foreign reserves, and they may have many more years of growth, but the headwinds are certainly getting stronger.

The 2 alternating images are from 1990 and 2013--just 23 years!!!.  In 1995 (my 1st trip) the skyline was pretty much the same as in 1990.  In 2001 the globular Pearl tower to the left was the only notable building on the skyline.  In 2007 I visited the construction site of the tall Shanghai tower and saw a scale model (and now, there it is!).  Just amazing.  How much longer can they grow at this pace?  5 years?  20?  50?

 

[irvinehomeowner]

While I'll admit that China does have its challenges, my common sense cringes at the comparisons to Japan.

Just like my common sense cringed at the comparison of US real estate to Japanese real estate that people were making during the last bubble. So many bears kept pointing to Japan's Lost Decade as an example of where the US real estate market will be after the bubble pops yet here we are with prices coming back and unpredicted stock market growth.

History doesn't really repeat itself, we make the comparisons to make us think so but the details will show different circumstances especially when trying to compare not only different countries but different cultures and economies.

It's like comparing Irvine to Santa Ana.

 

[morekaos]

Not at all.  The comparison is stark.  The trends are incredibly similar.  Japan was the China of today.  Our real estate bounces back just as it did when Japan collapsed and ceased to be the "envy" of our US economists.  China will overreach as well.  US real estate will find new bubble buyers (probably Indians) and they will make the same mistakes.  We that live here will live on with the waves of price fluctuations.  Its not us that changes in the cycles, its the sucker buyers that come and go.

 

[morekaos]

Agreed, the fleeting prosperity will not last...it never does, except here.  The roots of that prosperity may differ but the outcome of Asian fascination with US real estate and the eventual overpayment frenzy and  collapse are inevitable. Again, I am not focusing on the sellers (us).  I am looking at the buyers (them).  The next at bat will very likely be India...maybe in 20 years or so but probably sooner

 

[nosuchreality]

for human intensive labor items, like clothes, it'll shift around to the lowest bidder, but ultimately, manufacturing is coming back to America with the rise of the bots.

 

[nosuchreality]

The real question is which Talkirvine posters are really Sock Puppets?

"In 2011, a Californian company, Ntrepid, was awarded a $2.76 million contract under the auspices of US Central Command for "online persona management" operations[34] with the aim of creating "fake online personas to influence net conversations and spread US propaganda" in Arabic, Persian, Urdu and Pashto.[34] as part of the of a programme called Operation Earnest Voice (OEV), which was first developed in Iraq as a psychological warfare weapon."

Do we really think the Government agencies aren't directing it inward too?

 

[bones]

/

 

[nosuchreality]

The real question is which Talkirvine posters are really Sock Puppets?

"In 2011, a Californian company, Ntrepid, was awarded a $2.76 million contract under the auspices of US Central Command for "online persona management" operations[34] with the aim of creating "fake online personas to influence net conversations and spread US propaganda" in Arabic, Persian, Urdu and Pashto.[34] as part of the of a programme called Operation Earnest Voice (OEV), which was first developed in Iraq as a psychological warfare weapon."

Do we really think the Government agencies aren't directing it inward too?

Depends on whether you believe the government is possible of screwing in a light bulb.  As of now, i don't think they could make toast effectively.

Yet that won't stop the Government from taking your light bulb.

 

[OpenSky]

 

[test]

the role of government is to step in when ROI is negative or flat since private industry will not pursue those paths.  Negative ROI is expected for any long term development activity (e.g. advanced aerospace redesign, alternative fuel exploration, advanced material development, etc.) or public works projects.

SpaceX and Virgin Galactic prove otherwise.  If the government released its monopoly on public works we'd all have better public works too.

 

[test]

the role of government is to step in when ROI is negative or flat since private industry will not pursue those paths.  Negative ROI is expected for any long term development activity (e.g. advanced aerospace redesign, alternative fuel exploration, advanced material development, etc.) or public works projects.

SpaceX and Virgin Galactic prove otherwise.  If the government released its monopoly on public works we'd all have better public works too.

Oh yeah? Tell me about who paid for GPS?  And how did that constellation of satellites get into orbit?
I'm eager to hear your answer, considering i've never seen you at any of the meetings.



the only reason those companies are even viable is because of the idiotic decision to kill the space shuttle while satellites were already in development.  Now there isn't a vehicle big enough to carry certain satellites into orbit and they have to go back to the drawing board 10 years into development.

Russian rockets.  They're more cost effective.  No 6 figure pensions to pay for.

 

[test]

LOL the shuttle is a FAIL and try again.  So you are saying there's no way to launch satellites now? 
http://www.reuters.com/article/2013/11/25/us-space-spacex-launch-idUSBRE9AO0NN20131125http://news.yahoo.com/spacex-launch-landmark-commercial-satellite-mission-today-watch-153530081.html

FAIL and try again

Maybe if the government didnt have a monopoly on satellite launches we'd have better satellites by now.  But you cant think outside the statist box.

 

[test]

You should stick to built in fridges and wall insulation.  You seem to know a lot more about those things.

 

[morekaos]

The real question is which Talkirvine posters are really Sock Puppets?

"In 2011, a Californian company, Ntrepid, was awarded a $2.76 million contract under the auspices of US Central Command for "online persona management" operations[34] with the aim of creating "fake online personas to influence net conversations and spread US propaganda" in Arabic, Persian, Urdu and Pashto.[34] as part of the of a programme called Operation Earnest Voice (OEV), which was first developed in Iraq as a psychological warfare weapon."

Do we really think the Government agencies aren't directing it inward too?

Depends on whether you believe the government is possible of screwing in a light bulb.  As of now, i don't think they could make toast effectively.

What organization invented the internet? What school are your kids attending? Who is taking care of your parents healthcare? Who built and paved the roads you're driving on?

Government shouldn't do everything. But it does step in when the private sector fails, and should step aside when the private sector can provide the same or better service at a profit (without screwing the average joe).

Al Gore invented the internet - and he allowed us to use it as long as we don't download any explicit music.  I'm paying for all of my parents healthcare, living expenses and other costs.  Feel free to send me a check.

I have worked with the government for quite a few years.  Anyone with a rosy or idealistic opinion of how government works has never worked with the government.  Just like sausage making - if you don't know how it works, you think more of what you are getting.  What they don't tell you in civics class is that the right thing doesn't get done - what is put in to action is whatever is on the agenda for the folks in power (which is whatever their benefactors have paid for).  And often, the middle managers do absolutely zero - since they are not going to burn their political capital to support any shift in direction (which happens quite often when new leadership is appointed).

the role of government is to step in when ROI is negative or flat since private industry will not pursue those paths.  Negative ROI is expected for any long term development activity (e.g. advanced aerospace redesign, alternative fuel exploration, advanced material development, etc.) or public works projects.

On issue of streets here is one of my favorites right from my own area and a TOTAL waste of money as it was absolutely unnecessary and only pushed because the city had to use it or lose it.  What an efficient deployment of capital...not.  The three jobs created were the post hole digger. the sign installer and the sign painter...nice.