rangelife

Fight This Generation

60 Minutes, a show produced by and for World War I veterans, has instructed us 30-somethings to get the fuck out the way.

This pleases me dramatically. You see, the Boomers and their ancestors enjoyed defining our entire generation as cynical slackers, their primary evidence being two movies that grossed about $21M combined, or about 1/6 as much as The Flintstones movie. But Gen X's decade is done. Now the Millennials are in for a good reaming.

"Millenials put themselves first, like to be pampered, and aren't sorry for it." They also apparently all look like Comic Book Guy. ("Is there a word in Klingon for loneliness?") And even their moniker is a real bitch to spell. Is it one "n" or two?

Also, according to the 60 Minutes piece:

While this generation has extraordinary technical skills, childhoods filled with trophies and adulation didn't prepare them for the cold realities of work.

"You now have a generation coming into the workplace that has grown up with the expectation that they will automatically win, and they'll always be rewarded, even for just showing up," Crane says.

Praised throughout their no-failure childhoods, surgically attached to their iPods and mobiles and assorted gadgetry, the Millen(n)ials wander through their coddled lives making demands and expecting attention. Mommy got them into college, and Daddy wrote their resumes. If you don't praise them like little babies, they'll ditch you for another boss. Or as an ad exec puts it:

"If you don't want me, Mr. Employer, I'll go sell myself down the street. I'll probably get more money. I'll definitely get a better experience. And by the way, they'll adore me. You only like me."

Of course, what the 60 Minutes report totally misses is that the primary difference between this gen and the last isn't the self esteem or the iPods: It's the job market, stupid.

Gen X joined the economy at a lousy time. As globalization and recession hollowed out the middle class, the new adults of the early '90s had no sense of their place in the future. In 1994, there were no stock options, no Web 2.0 startups, just dead-end McJobs and territorial Boomer bosses with mortgages. For some it created a sense of cynicism. For others it created a sense of focus. For too many, it created a path to law school.

But today's new college grad was 9 or 10 years old when Netscape IPO'd. With the exception of a minor slowdown that started right around Dubya's first inauguration, the Millennials have only known boom times. As our dollar-depressed, housing bubble-busted economy drags downward, so will a young whippersnapper's ability to job-hop their way to Nirvana.

So move over, Gen X. There's a new generation to stereotype and abuse. And they'll have to miss that 2pm meeting. They have yoga.

Fascist? Who?

Unemployment remains historically low in the SF Bay area. And in spite of beneficial disruptors like the minimum wage, and destructive ones like caring about Ellen DeGeneres' dog, the labor market tends to find a clearing price:

In other words, somebody is going to take this job.

---

Ann Coulter is a professional provocatrix. And I do mean "professional"; she is the Kobe Bryant of pooping outrage just to get people writing about her, and then she rakes in outrageous money -- Kobe paper -- from selling books and delivering speeches.

What's especially remarkable about Coulter's career is how nothing takes her down. At this point, she could call for the restoration of slavery, for all golden retrievers to fight to the death, and for Turkey to finish the job in Armenia, and she'd just sell more books. Like liberals who ignore Bill Maher's unabashed misogyny, Coulter is many conservatives' ultimate guilty pleasure.

This is why, up until the two site hacks over the past week, I haven't mentioned Coulter too much on this here blog. There's about as much point getting outraged about Coulter being controversial as, say, Family Guy making a poopy joke.

I think people comprehend this by now, which is why it's heartening to see how little piss and spittle Coulter's Jew-bashing has generated. Yes, on Sweet Jesus, This Show is Still On? with Donny Deutsch on CNBC, Coulter invited the Jewish ad man to come to church with her, because America is only unsafe and unhappy because Jews and Muslims aren't Christians.

While this impressively focused anti-Semitism got a little attention, what's even more impressive in the transcript is the revelation of Coulter's base philosophy: You know who's happy? Christians! You know why? Because they have religious laws, and they obey them. Obedience = happiness. Liberty = anguish.

Now, hippies of all ages love to cry "Fascist," whether it's at DPT for ticketing them for parking their RV on the sidewalk, or Comcast for turning off their unpaid adult pay-per-view. But Ann Coulter is definitely purely absolutely a fascist.

And that's the last I'll ever write about her.

***

The NY Times reports that people who still can't distinguish among 9/11, Saddam Hussein, and the current war in Iraq support Rudy Giuliani for president.

OK, can we stop wringing our meaty hands just because 33% of Americans still think Saddam was behind 9/11? I mean, 36% believe that the Book of Revelation will unfold exactly as written.

In every poll ever taken in the future, a certain percentage of respondents will be ill-informed, lazy, uneducated, dumb, or just crazy. A majority of these people -- thank God (the Jewish one) -- don't vote.

Hollywood Sez: "Everything You Steal, You Would Have Bought"

There are four types of headlines that translate to "Bullshit Below":

• "Bonds: 'I'm Just Focusing on Winning a Championship' "
• "Bush Administration: '___________' "
• "[Politician]: We Can Do Something About Gas Prices"
• "Hollywood Estimates Piracy Losses at _____."

In spite of the comical demagoguery of any politician seeking blame and retribution for gas prices, or the White House addressing pretty much any topic at all, of the above Hollywood's bullshit supports an agenda that might be the most damaging to our future.

First of all, "Hollywood" (the major film studios) is just a piece of a broader cartel of Big Entertainment, which includes many of the television channels, magazines, and websites you consume every day, as well as the CDs (or iTunes) you buy and, inevitably, the books you pretend to read and videogames you play. While all these industries have their own piracy solutions in mind, they all have a similar concept of what "piracy" is: anything you didn't pay for.

Today's WSJ details Hollywood's latest stab at quantifying "losses" to piracy: $6.1 billion globally per year, which is abouy 75% more than the prior estimate. (WSJ: "Studios See Big Rise in Estimates of Losses to Movie Piracy.") That's right, Hollywood claims they would have earned $6.1 billion more wholesale revenue in 2005 if people weren't bootlegging or ripping or downloading. That more than the profits of Goldman Sachs, Home Depot, American Express, or PepsiCo. (Yes, I'm comparing revenue to profits, but the production costs of the content were mostly "sunk" already.)

The most obvious fallacy of the piracy "loss" estimates is that they usually assume that everything downloaded or bootlegged would have been purchased at full price. In other words, the kid on your block (or in your house) who's illegally downloaded 100 movies would have otherwise spent the $1,700 or so to buy them all on DVD. And the Chinese factory worker who bought a bootleg of Finding Nemo would have dropped two days' salary for the authorized version.

This latest report admirably -- but again, fallaciously -- attempted to account for this with survey questions:

Critics have faulted some piracy estimates for equating each pirated DVD with a lost sale, when many consumers would have skipped the movie altogether if they hadn't gotten a cheap or free unauthorized version. This time, the survey specifically asked consumers how many of their pirated movies they would have purchased in stores or seen in theaters if they didn't have an unauthorized copy, giving studios a different picture of their true losses.

Can you imagine how these questions were asked over the phone? How honest did they expect the respondents to be about activities that could get them sued or imprisoned, with increasing penalties per amount of pirate activity?

Time Warner was one of the media companies that was pushing hardest for the public release of the study; ironically, the headline to the right of the article reads "Time Warner's Net Rises 59%." Obviously downloading is killing Time Warner, in case you were wondering whether you really saw Richard Parsons squeegeeing windshields near the Holland Tunnel last year.

Of course, piracy is inherently a bad thing, but in the case of the entertainment biz, it's more about media companies failing to deliver what consumers want than consumers getting something for nothing. Napster, Morpheus, and Kazaa, after all, arose when record labels were hardly digitally distributing at all. (If you won't sell it to me, I'll steal it.) And now Hollywood is doing its best to encourage piracy with its warped business model, in which legal downloads will cost twice as much as DVDs with none of the extras. (Details at my favorite business blogger, Barry Ritholz.)

So, why is $6.1 billion of bullshit bad news for the human race? Because the MPAA and its media/entertainment brethren will use it to encourage damaging new laws and aggressive enforcement, instead of using the threat of piracy to innovate. Congress has already displayed its willingness to grab its ankles for Hollywood by extending copyright almost into infinity at the expense of the public, which doesn't have nearly as good lobbyists.

In the meantime, you should absolutely pay full price to see every movie that's worth seeing. This time of year, that shouldn't take up too much of your life.

Realty Reality

Look out below!

Yes, many economists have been predicting a roll-back of real estate prices for the past few years, only to see prices launch another 15%. The eggheads at UCLA's Anderson Forecast have been some of those most prominent housing bears, so reading that their senior economist Christopher Thornburg is saying that "the housing bubble is popping now" is no surprise.

"You are starting to see a slowdown in housing market activity, and that says loud and clear that things are starting to break," Thornberg said. "The feeling is that we have peaked. And beyond that is a downhill run."

Thornberg said California home prices are about 30 percent to 40 percent overvalued. He added, though, that a decline in prices -- if that comes about -- would occur over the better part of a decade, not suddenly. And the falling of that domino would jolt others, he warned.

"If you have a big decline in unit sales, you'll have mortgage brokers and real estate agents and construction workers all losing jobs," Thornberg said. "And what's driving the California job market right now? Construction, finance and real estate jobs. Those will go away."

A slowdown in the value of homes would constrict the amount of equity that homeowners can tap to pay for everyday expenses or discretionary spending.

"Don't forget about the wealth effect," Thornberg said. "All that wonderful money is going to disappear. Suddenly, the house isn't going to be able to pay for the kids' education, it's not going to pay for your retirement in Bermuda and it's not going to pay for that face-lift at age 74."

But the flattening of real estate prices, especially in coastal California, is no longer about econometric models or price/rent ratios. The difference is that this time, the bears have real numbers to back up their ideas:

A separate report from the Federal Deposit Insurance Corp. about the regional economies around the country detailed a significant slowdown in home sales. A portion of Tuesday's FDIC report, based on data collected by the California Association of Realtors, found that it's taking longer for owners to sell their houses.

For example, in an East Bay real estate territory that includes the Tri-Valley and the Fremont-Hayward region, homes last September remained unsold for an average of 2.1 months. That's up 163 percent from the roughly 24 days that homes remained unsold in September 2004.

Areas that include central and eastern Contra Costa suffered a 73 percent increase in the time that homes were staying unsold, while San Francisco struggled with a 75 percent increase.

And that was back in September. It hasn't gotten better -- more than one house I saw for sale in October and November resurfaced in the rental listings in December. Home prices in San Mateo have dropped by $100,000 since last April. Anyone think we'll get another 10% increase this year?

Additionally, the vile horror show that is the Craiglist housing forum is starting to fill with posts by panicked, underwater sellers. Like this one. And this one. You didn't see those a year ago.

Oh, baby. Not good for anyone.

(For the record, I'm not a "bubblista." I tend to view real estate, as The Big Picture does, as an "extended asset class" with a handful of speculative, doomed mini-bubbles where bucks outnumber brains [South Florida, Las Vegas, Phoenix].)

Boo, American Real Estate! Yay, Cervical Cancer!

The current issue of Fortune features one of those annoying buy-me-please teaser covers:

The World's Greatest Real Estate Investor
(and what you can learn from him)

Here's a hint: His main lesson is not "buy more condos."

Now here's the spoiler.

"I feel totally safe playing polo on a field full of pros," says the bronzed 58-year-old. "But when amateurs are all over the field, someone can get killed. They have more guts than brains. They charge after every ball and don't know when to hold back." It's the same with the U.S. real estate market right now: "There's too much money chasing too few good deals, with too much debt and too few brains." The amateurs are going to get trampled, he explains, taking seasoned horsemen, who should get off the turf, down with them. Says Barrack: "That's why I'm getting out."

Yes, the man with a $25 billion portfolio of global assets is selling off almost all of his US real estate assets (except for a casino or two), because it's become a sucker's game. And apparently someone much smarter than I agrees that Miami's condo boom is doomed:

Today Barrack sees signs of the tech bubble mentality in the U.S. real estate market... And he sees the bubble deflating soon. Barrack thinks the catalyst will be a trend that few others are talking about, a steep rise in the price of building materials and labor. "Construction costs have spiked 30% in the past nine months," he says. The reasons: shortages of labor and materials like lumber because of the building boom, and increases in the price of oil, needed to produce everything from plastic piping to insulation to shingles.

The slump will show up first in speculative hot spots like Miami and Las Vegas, he says, where condo developers are preselling their projects for what look like big profits. When they actually build the units over the next year or two, he predicts, they will end up spending more than the units are now selling for. At that point, says Barrack, the developers will try to raise prices. "But most of these buyers are speculators," he says. "They will either sue the developers to get the original prices or get their deposits back and walk away." The developers will then put the units back on the market, and the glut of vacant condos will drive prices down. "It's the busted deals caused by construction costs that will cause a turn in the market," he predicts.

Note that this article was written and published before Hurricane Wilma gave condo developers a whole lotta competition for roofers, plumbers, and drywall.

In the Bay Area, the real estate market has shifted dramatically over the past two months. How do I know? Because everybody I know who's looking to buy tells me so. Bidding wars are scarce. Low balls are being entertained. Or so I hear.

(Oct. 31 Update: How else do I know? Because yesterday (Oct. 30) I visited a half-dozen open houses in Glen Park, Portola, and Ingleside Terrace. The air of desperation by sellers was as thick and ugly as a nightclub at 1:30am. One seller offered to cut the asking price by 12% right there if I'd put in an offer. Heh.)

Elsewhere in that issue is a must-read about the fight against (yes, against) an incredibly effective vaccine against cervical cancer, the number two cancer killer of women. Merck's discovery has demonstrated 100% efficacy against HPV, the dominant strain of the virus that causes cervical cancer, but a coalition of right-wing Christian groups are banding together to keep women from being vaccinated. Why? HPV is passed primarily via sexual contact (and condoms are no defense), so the superstitious nutjob side of the Culture War think the vaccine will encourage girls to screw.

Let's go over that again: So-called Christians want to keep women from getting a vaccine against cervical cancer, because cervical cancer makes women afraid of sex. Yay, cervical cancer, the chastity belt of God!

What do you think these anti-sex fundamentalists will do when we have an HIV vaccine?