  Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 37 Registered: 11-2007 |
http://www.nytimes.com/2007/11 /25/realestate/25nati.html?ref =realestate must really suck to be the last guy mentioned in the article | ||
Jjaba Member Username: Jjaba Post Number: 5634 Registered: 11-2003 |
Can The Rock give us a local perspective? jjaba. | ||
Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 38 Registered: 11-2007 |
who is the rock | ||
Granmontrules Member Username: Granmontrules Post Number: 261 Registered: 01-2007 |
We have a cousin who overpaid (at the time) for a house in Grosse Pointe Park. Now they are stuck in this house, which they put over 100,000 in upgrades into it, and are trying to sell for what they have in it 650,000 - they just got an offer because it is near the water for $450,000. We are glad we resisted the upgrades and stayed in our modest home. | ||
Wazootyman Member Username: Wazootyman Post Number: 286 Registered: 02-2006 |
I can't dispute facts in the article, but at the same time I have to ask why it is being published in the NYT. They briefly metion that other affluent markets are having similar issues, but focus their attention on the woe of the Detroit-area market. Just more bad publicity that we certainly don't need. Let's make sure that once a day we can remind the country that Metro Detroit loses population, has high unemployment, and it's just plain awful around here (not my thought, just the feeling I get from articles like this). More on point to the article, I find it funny that someone could buy a home for $500,000 less than the asking price, yet complain that his present homes aren't selling. Assuming the presently owned property has adequate equity, he can take a loss on the sale, but make up for it in the discounted purchase price of the new property without issue. So, he isn't making a profit. Neither are most of my stocks. "Indeed, Michigan has lost 369,000 jobs since 2000, according to an analysis by the University of Michigan, with 60 percent of those positions coming from the Detroit region alone. Many of those jobs have been from higher-paying manufacturing positions related to designing and building cars and trucks." It's funny that they mention 60 percent of the job losses have been from Detroit. Considering that roughly 60% of the state's GDP is from Metro Detroit (source: http://www.bea.gov/regional/) this isn't really surprising, or relevant. Also, what is a "manufacturing position related to designing and building cars and trucks"? If it seems like I'm being overly sensitive about this subject, I suppose I am. But at the same time, I don't think the NYT or the majority of the country understand the significance of what is occurring in Metro Detroit. They view it as an anomaly. It's kicking a region when it's already down. Detroit is old news and it won't affect us, they say. Manufacturing in the midwest built this country, and coastal high-rises with service and finance jobs can't and won't ever make up for the economic losses. | ||
Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 39 Registered: 11-2007 |
I read the real estate section of the times pretty religiously and they always have these sort of regional snippets. I've definitely read stories of how there is a downturn in San diego and miami so it's not as though they are picking on detroit. I'm afraid your analysis on the financial status of the owner who got a 500K deal is a bit off. If he sells his two homes at a loss that is an actual loss. He probably can't cover the mortgage and will have to use up some of his cash. OTOH, by getting a 500K discount that is a paper gain, which is to say that he gets nothing. It's not as though he can resell the house and collect that profit. More likely, he'll get even less than what he paid, even with the reduced price. I think they said, "manufacturing position related to designing and building cars and trucks" in order to explain that they were white collar losses, meaning a more affluent bunch. Sorry if this comes a bit harsh but saying "Manufacturing in the midwest built this country, and coastal high-rises with service and finance jobs can't and won't ever make up for the economic losses" is flat out dumb. You do realize that the world is a service economy? There is a reason why rust belt industrial cities are going through a decline (which i hope leads to a renessaince). | ||
3rdworldcity Member Username: 3rdworldcity Post Number: 981 Registered: 01-2005 |
Nonsense. We should be happy that the NYT ran the article. There are probably several NYT readers who are fighting being transferred to the area who may take a second look based on the real estate prices mentioned in the article. I'll bet there are many local real estate brokers who are happy as can be to see the story. Free advertising, What if the article had been about Scottsdale? Would we have cared or been very interested in it? Probably not, any more so than the rest of the country cares about what's going on here. | ||
Fnemecek Member Username: Fnemecek Post Number: 2610 Registered: 12-2004 |
quote: Because it happened. The NYT considers the entire planet to be its beat. More importantly, the collapse of the housing market/mortgage industry seems to have started here. Therefore, there's a decent chance that what is being experienced in the Detroit area will soon be seen across the nation; thereby driving the NYT's interest in covering the story. | ||
Queensfinest Member Username: Queensfinest Post Number: 135 Registered: 08-2006 |
Wazootyman said: "If it seems like I'm being overly sensitive about this subject, I suppose I am. But at the same time, I don't think the NYT or the majority of the country understand the significance of what is occurring in Metro Detroit. They view it as an anomaly. It's kicking a region when it's already down. Detroit is old news and it won't affect us, they say. It's a warning sign. Manufacturing in the midwest built this country, and coastal high-rises with service and finance jobs can't and won't ever make up for the economic losses." Manufacturing in the Midwest built this country? Los Angeles is the largest manufacturing center in this country and has been among the leaders in the sector since the height of manufacturing decades ago. Manufacturing is still growing in the south. Manufacturing was a much larger sector of the economy in most regions of this country until a few decades ago, not just in the Midwest. Here's just one example. Between 1969 and 1999, manufacturing employment in the New York-New Jersey region plunged 51 percent, a drop that far exceeded the 8.4 percent decline in manufacturing jobs nationwide. Some areas within the region were especially hard hit by the employment losses: New York City shed more than two-thirds of its manufacturing jobs, while neighboring northern New Jersey lost 55 percent. You're right, in my grandfather's era this country was a lot more dependent on manufacturing. Then most of the country wised up, adapted to a global economy and diversified. Why was NYC and most of the rest of the country able to plan ahead and diversify their region's economies and you weren't? A handful of places like Detroit and Buffalo sat around, stagnated, failed to adapt and are now obviously feeling the results? You wonder why it is we're having this conversation about your town and not the rest of the country, which is thriving for the most part? I suppose that's why the Times ran the article? This is real news to the rest of the country because it's not normal. Detroit and Michigan are far from normal. I sometimes wonder if most of the people of Michigan even aware of this? There are approximately 250,000 jobs in finance on Wall Street in NYC alone that pay an average salary of $350,000 per year. This is just one way we've made up for the loss of manufacturing jobs in NYC. You need more examples? I suppose we're just all "morons" here on the coasts though, right? The rest of the country thrives while Detroit and now Michigan die and we're the ones with the problem? Don't you realize that intelligent and successful people in government and academia around the world study the Detroit Metro area as the textbook example of how not to do things? You're right, the rest of us need Michigan. You allow us to learn from your mistakes. Thank you for that. | ||
Mwilbert Member Username: Mwilbert Post Number: 4 Registered: 11-2007 |
Queensfinest's post makes some good points and some silly ones. To take two: The Detroit area is so far as I can tell, rather unusual in its level of political dysfunction. The divisions between the city and the suburbs, and between the metro area and the rest of the state seem to be deeper than in most other parts of the country. Many places have been unable to stop sprawl, or unable to create a transit system, or unable to create a rational system of local governments and schools, or unable to preserve the region's central city, but southeastern Michigan is somewhat unique in failing at all of them. I think it is fair to say the little has been done to make the area attractive in an attempt to deal with the completely predictable decline of automotive employment On the other hand, it is odd to think that the finance jobs in New York are the result of any kind of planning--New York having been a leading financial center since colonial times, and the preeminent financial center in the US since before the Civil War. As far as I can see this enormous success doesn't owe much to any planning done since the Erie Canal was built. It is important to remember that New York's economy was always more diversified than Detroit's, and especially so since the rise of the auto industry. When one important segment of New York's economy declined, there were others there to take up the slack. There is nowhere in the US with the diversity of commercial activities as New York except maybe greater LA, and again this was not a result of conscious planning. In Detroit, and to a slightly lesser extent Michigan, there just aren't as many alternative sectors. Also, manufacturing in New York declined earlier than manufacturing in Michigan, and never paid as well either, so the New York economy took less of a blow to income and has had more time to adapt as well. But the key thing that makes this a national story is that the housing/foreclosure crisis has had and will have effects everywhere. The difference is that unlike most parts of the country, metro Detroit is actually losing population, so it is unclear where the demand for the excess housing that has been created is going to come from. In the most of the country, a few years population growth should sop up most of the excess supply. There is no reason to think that will happen in Michigan. I don't really understand how supply and demand are going to come into balance other than the abandonment of lots of the housing stock--obviously this has been happening in Detroit proper for years, but I expect to see a lot more of it in the suburbs. I hope the outlying towns deal with it better than the city has. Sorry to be such a ray of sunshine, but people need to understand that while this is a national problem, it is going to be worse in Michigan than anywhere except possibly Florida (because although they have a growing population, the overbuilding there is extreme, and because the insurance situation there is so messed up that it is going to be hard for buyers to get mortgages.) | ||
The_rock Member Username: The_rock Post Number: 2015 Registered: 11-2003 |
Hi onlypeople, You asked, and now you know. I'm the rock. We are hoping for a renaissance in Grosse Pointe.(I spell "renaissance" a little differently than you do.) Interesting article in the NYT. We know the O'Tooles quite well,and they are neighbors of ours just a couple of streets over. Maybe there is some light at the end of the tunnel. If the figures are accurate, 600 homes will be bought this year. I have seen more "sold" signs in the last three months. GP will weather the storm. | ||
Aoife Member Username: Aoife Post Number: 41 Registered: 04-2007 |
Wow. Meow, Queensfinest. Anyway, I wouldn't take it personally like the NYT are picking on Detroit just to pick. Our region is in a major housing slump, probably one of the worst in the nation. Based, as noted elsewhere and often, on our high unemployment and forclosure rates. Yes, other places in the country have the same problem, but they chose to focus on two of our suburbs probably based on name recognition. Saying there is a housing crisis in Scottsdale is not the same as saying there is a crisis in Grosse Pointe. The Pointes have a nationwide reputation of being old money and affluent. They are a stereotype of wealth. It makes the story more interesting. | ||
Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 40 Registered: 11-2007 |
rock - apologies for not running my post through spellcheck. I really don't know what to make of the stats. I suppose its a good thing that yearly sales are up, but it isn't if it's due to huge discounting. If the O'tooles sell their home this year that adds to the sales number but it's a little silly that you can purchase a 3,500 sq ft 5 br home in one of the most "affluent" suburbs in the nation for less than half a million dollars. | ||
Jjaba Member Username: Jjaba Post Number: 5635 Registered: 11-2003 |
Queensfinest gives us an amazing statistic about Wall Street jobs. Those who deal in money transfers seem to do pretty well, eh. We knew The Rock would score big on the Honestly index. He's been there for a really long time, some say even before the Dodges, so he should know. If The Rock ain't worried, then we shouldn't worry either. He has endured housing slumps, fish flies, and wearing no socks in Summertime with those dress lawyer tassled shoes. The New York Times mostly delights in putting Detroit down, so why not put down the rich areas too. "Say nice things About Detroit." jjaba, Proudly Westside. | ||
Thecarl Member Username: Thecarl Post Number: 1185 Registered: 04-2005 |
quote: one reason: many new yorker's lived in detroit/michigan/midwest, have relatives in the detroit area, and/or went to school at the university of michigan. the article actually does have some local appeal in the new york market, although the new york times is published across the united states, and elsewhere. and, in those places, you will find folks who lived in detroit/michigan/midwest, have relatives in the detroit area, and/or went to school at the university of michigan. you can be sure that the nyt knows its audience. | ||
Ray Member Username: Ray Post Number: 1043 Registered: 06-2004 |
These are very interesting veiwpoints expressed above. I think the fundamental question is not "Why did the auto industry decline" (many industries decline) but as stated above, "why has Michigan been lagging in the creation of new industries." Working in Silicon Valley and living in Michigan, I lie awake every night pondering this. The people in Michigan are not dumb. They are not lazy. In fact, ironically, many people in SV starting and running companies grew up in Michigan. The bottom line, I think, is culture. Michigan has a culture poorly suited to the New Economy. It's hard to put your finger on exactly the problem, but it's the same culture that allowed the center city to die. Sort of complacent, conformist, suburban, structured, entitled mentality. It's very frustrating to watch. | ||
Thecarl Member Username: Thecarl Post Number: 1186 Registered: 04-2005 |
quote: 1. granholm is beholden to the unions. 2. the present incarnation of the mcnamara political machine is taking what it can, while it's there, with little regard to the long-term interests of detroit and the state. short-term projects and studies are consuming taxpayer dollars under the ruse of benefiting "cool cities," while the democratic party covets the purse strings of the state's economy. | ||
Ray Member Username: Ray Post Number: 1044 Registered: 06-2004 |
Thecarl, As much as I love to hate the Democrats, I'm just kind of exahusted with it (blamming Granholm). I think the problem is much deeper. These issues with unions and liberalism run deeply in otherwise very successful places like SF, Chicago, Boston and NY. Our problems go back 50 or more years. | ||
Cinderpath Member Username: Cinderpath Post Number: 269 Registered: 05-2006 |
Onlypeoplewhohatethemselveshat eme writes: "You do realize that the world is a service economy? There is a reason why rust belt industrial cities are going through a decline (which i hope leads to a renessaince)." The world is a "service economy" what planet are you living on? No offense, but the US is shifting to a service economy, but the world is still very much a manufacturing, and resource based planet. Apparently you have never been to a mall, which sells mostly manufactured products, or filled up your car with gasoline (not a service). By the way emerging manufacturing economies, (China) are well on their way to overtaking our economy. "Services" only service these economies. Always have, always will. | ||
Cinderpath Member Username: Cinderpath Post Number: 270 Registered: 05-2006 |
While the New York City economy is ok, the state of NY, particularly up-state region is doing terrible, and is is also because of a loss of manufacturing jobs, which they too have not adopted too well. Your not being completely truthful when talking about NY. In fact if NYC was not part of NY, the state would be just as bad, if not worse than the Detroit region. | ||
Thecarl Member Username: Thecarl Post Number: 1187 Registered: 04-2005 |
ray, i have nothing against the democrats, per se. i lean republican, but have never voted a straight-party ticket, and i probably never will. and, i'll say this: democrats are not always "democrats" or "liberals." to substantiate my point, i'll use two words: "southern democrat." as such, the terms used in my original post only describe what i am seeing in michigan. granholm has failed most notably in making michigan a right-to-work state. she has failed to take on unions and negotiate labor costs (the way the auto companies finally did.) sure, manufacturing jobs have gone to mexico and abroad, but granholm failed to curb michigan's reputation of having a hostile labor group - and so, just take a look at all the new manufacturing facilities that the southern states so very much enjoy - and we don't. now, comparing detroit with sf, chicago, boston, and new york - i would say the short answer is that detroit failed to diversify in the way those cities did to sustain their fortunes. considering that, now is the time for unassailable leadership to build upon the resources of detroit and michigan - but i only see the current leadership clamoring for votes, power, and dollars. | ||
Ray Member Username: Ray Post Number: 1051 Registered: 06-2004 |
Well, Thecarl, you argue your points very well and I am at a loss to rebut them. | ||
Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 41 Registered: 11-2007 |
Cinderpath writes "The world is a "service economy" what planet are you living on? No offense, but the US is shifting to a service economy, but the world is still very much a manufacturing, and resource based planet. Apparently you have never been to a mall, which sells mostly manufactured products, or filled up your car with gasoline (not a service). By the way emerging manufacturing economies, (China) are well on their way to overtaking our economy. "Services" only service these economies. Always have, always will." It's a bit remarkable how uninformed this post is. The US has been a service economy for quite some time and it accounts for over 80% of this country's GDP. http://usinfo.state.gov/produc ts/pubs/economy-in-brief/page3 .html The fact is, for developed countries, services are where the majority of their GDP comes from. This link and corresponding graph should help you understand this. http://diec.onene2dev.raki.eni gmainteractive.net/page/servic e_economy.cfm "Apparently you have never been to a mall, which sells mostly manufactured products, or filled up your car with gasoline (not a service)." I love this comment of yours. You do realize that the people who man the counters, sell the clothes, patrol the premises of malls are in the service economy? I'd venture to guess that more people are employed by the mall than the amounts of people that were needed to manufacture the things these people are selling. Your gas station comment is not deserving of a response. Your China comment is a bit silly. You do realize that 40% of China's GDP is from services. I'd venture to guess that they'd like to increase that percentage since every other developed country maintains a service dominated balance and is suggested by the World Bank. http://news.xinhuanet.com/engl ish/2007-11/02/content_6997107 .htm A quote made by the World Bank: "But China must restructure to catch up, Hofman added. It should rely less on capital investments in industry as savings rates decline along with an increasingly youthful population, he said. A demand-driven services economy as well as growth in financial and consulting services should replace capital-intensive economic stimuli, he said." http://findarticles.com/p/arti cles/mi_m0WDP/is_2005_Nov_7/ai _n15801767 I'm sorry if this post is condescending but I'm only reciprocating the tone that you have given me. You are extremely uninformed. | ||
Cinderpath Member Username: Cinderpath Post Number: 271 Registered: 05-2006 |
Neat- you point out what we already know- The US has shifted to a service economy. Now take a look at the current value of our Dollar, and the duel deficits, (Trade, and budget) and consumer debt, and look at the rise in current manufacturing economies, in particular in Asia. Apparently other countries, and their respective markets are less than impressed with our consumer driven, mostly service economy at the moment (maybe due to such great "products" as the sub-prime fiasco) now that credit cards are all maxed-out, consumer debt is at an all time high, and the rest of the world has found out the emperor has no clothes. Financial markets are interestingly reacting appropriately as our world economic dominance continues to be marginalized. My point was that economies are obviously a combination of goods and services and that one relies on the other, and in many cases the more balanced the better. Fortunately, you prove my point perfectly: China's economy is doing fine despite advice from the World Bank, and their growth rate seems to be leaving us in the dust (what would we do with 11.1% Growth?), and their manufacturing sector contributes over 44% to its overall GDP, and services sector of 40% as you point out, compared with our 67% GDP (your stats) coming from services, while our growth is stagnating. If you feel the need to argue this point go ahead, but the planet will still consume goods (mostly manufactured), and there will always be a market for this. | ||
Gianni Member Username: Gianni Post Number: 324 Registered: 05-2004 |
I'm no economist, but I'm pretty sure you can't create value or wealth on only a service economy. The wealth has to come from somewhere before it can afford to buy service. That means either natural resources (Saudi Arabia, Venezuela, Rockefeller, old Michigan Lumber barons), or taking natural resources and adding value by -- guess what -- Manufacturing (or farming). The only reason the USA can afford to be moving to a service economy is because we are taking advantage of the cheap labor in China, etc. where we are now doing the manufacturing. Without that, where do you think all the mall jobs -- low wage mall jobs -- would come from? Think about it. If everyone were in the restaurant business, how long could it last with only restaurant people buying and selling from each other? I remember being in Kenosha Wisconsin in the early 80's after the big Chrysler plant had been closed for a few years. The local papers were trumpeting as progress that the area could finally have a mall because the retailers did not want to locate there while there was an auto plant because wages were too high. So after the plant had been close for a few years, the chain retailers felt more comfortable opening stores in the area because they could finally get people willing to work -- in the service economy -- for next to minimum wage. That's progress? I dont have the answers to how we can maintain a prosperous economy here without manufacturing or natural resources. But for people to say all we have to do is "diversify" into the service economy is missing the big picture. It just seems that if people somewhere don't make things, we all go broke. You have got to have some infusion of wealth or value added through capital and labor (created from manufacturing or agriculture or natural resources) so that people can afford to buy services. | ||
Mwilbert Member Username: Mwilbert Post Number: 6 Registered: 11-2007 |
"You have got to have some infusion of wealth or value added through capital and labor (created from manufacturing or agriculture or natural resources) so that people can afford to buy services" This is a widely held view, but it is not exactly correct. Yes, someone has to produce goods, or there wouldn't be any goods. But you don't have to produce the goods to add value. The iPod is manufactured by a contract manufacturer in China. They sell it to Apple for about $40. Apple sells it for (a lot) more. What is Apple providing to make its money? Services--design, sales, marketing, support. Then they make more money by selling music for it. At no time is anything manufactured by them, but they are adding enough value to support thousands of jobs. A lot of the value-added in the auto industry also comes from those sources--design, marketing, sales, repair. But proportionately, it is a much less, so moving auto operations to other states or offshore involves a substantial loss of value-added opportunities for Michigan and its residents. | ||
Lowell Board Administrator Username: Lowell Post Number: 4323 Registered: 10-2003 |
Even in Michigan, with all its manufacturing, information workers far out number manufacturing workers and always have. As for New Yawkers, meaning mostly Manhattanites, they suffer from a lot of insecurity which is displayed in repeated, mostly unconscious, put downs of anything outside of Manhattan. This famous 'New Yorkers view of the world' 1976 cover of the New Yorker said it all:  | ||
Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 42 Registered: 11-2007 |
i never said we are supposed to have a full service economy. only that it will be overwhelmingly so. you'd have to be stupid to believe that all manufacturing will dissappear. | ||
Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 43 Registered: 11-2007 |
To cinderpath: Way to change the tone of your posts. is shifting =/= has shifted. You realize that subrime loans are not a manufacturing product, right? Like all finance related jobs, it's a service. Please don't fake my stats. The stats I have clearly state that our economy is 80% service. First and foremost, making comparisons between growth rates is stupid. Having a higher growth rate does not necessarily make a better economy, and is in fact a bad thig. Inflation would be a major concern. Stability and moderate growth is what is best (we have like 2% i think, and the rate is continually monitored so it doesn't get out of control). The fact is, China has and is continually trying to grow their service economy, (at a tune of 11%). Just because other sectors are outpacing that rate doesn't mean that services aren't their main priority. Everybody knows, and I have never heard differently until now, that the service economy is the standard that countries strive for. Manufacturing economies don't work because it is too capital intensive and you ultimately drive yourself out of business. (Once you get better at it, you can do it for less. Once you do it for less, you sell more. Once you sell more, there is more supply, which then puts more downward pressure on what you are selling) Manufacturing economies turn products into commodities, which isn't that good of a thing. OTOH, service economies are built on human capital. There is no limit to human capital. By getting better (i.e. higher education, innovating ideas in finance and law) means you can charge higher prices, etc. human capital>capital. The fact that you don't know any of this leads me to believe hat you have no idea what your talking about. You string together newspaper soundbites of consumer debt, deficits and dollar values with no way of actually connecting them. It only makes you sound ridiculous when you can't understand even the most basic ideas. | ||
Onlypeoplewhohatethemselveshateme Member Username: Onlypeoplewhohatethemselveshateme Post Number: 44 Registered: 11-2007 |
"I remember being in Kenosha Wisconsin in the early 80's after the big Chrysler plant had been closed for a few years. The local papers were trumpeting as progress that the area could finally have a mall because the retailers did not want to locate there while there was an auto plant because wages were too high. So after the plant had been close for a few years, the chain retailers felt more comfortable opening stores in the area because they could finally get people willing to work -- in the service economy -- for next to minimum wage. That's progress?" Of course that's progress. although the transition is rarely smooth it is for the best. In the short term it causes underemployment but its the best move for the long term. Ther is absolutely no reason why someone with only a high school education and only working 60 hrs a week on an assembly line should be making over 100K a year. It sucks since these people have no skills and can't make the adjustment, but their children have the incentives to not be like them. "I dont have the answers to how we can maintain a prosperous economy here without manufacturing or natural resources. But for people to say all we have to do is "diversify" into the service economy is missing the big picture. It just seems that if people somewhere don't make things, we all go broke. " Of course, somewhere someone needs to be making "stuff" but it doesn't need to be us. Think of all the high paying service jobs there are: doctors, lawyers, bankers, consultants, accountants. While most of the jobs I've listed get their work flow from the companies that manufacture things, that's not neccesarily true. The value added comes from the human capital they provide. Even so, think of all the things you know that are in the service economy. Every retailer basically you know of that doesn't make their own stuff (every electronic retailer, computer store, clothing retailer). While I suppose things get tough when you shut down a plant, imagine taking everything else away. Note: again, not saying we should be 100% service, but it no longer makes sense for americans to build everything they need. It's far more efficeint if we put our minds to work. |
