HOLLYWOOD WILL SAVE US FROM COMMUNISM

11-05-08
Two years ago, I thought the world had seen the end of communism. The Soviet Union was gone, Europe and Canada, waking up to double digit unemployment and stagnant economies, began to abandon the stifling socialist policies that brought them to the verge of bankruptcy. Even China accepted forms of market capitalism (which in turn led to an improvement in human rights) to fuel their growth. In the U.S., property rights were strengthening, regulations were easing, union membership was dwindling. I naturally thought Communism was on its last breath. I was wrong. It's making a global comeback. And America has done an about face, questioning free markets and about to elect what may become the most liberal government since Roosevelt. Some wonder if America is sliding down the path of Venezuela and China.

I think not, for we have an unlikely savior -- Hollywood. That's right, we will be saved from communism by the liberal, left slanted, never-grounded in reality Hollywood. I am serious. The themes produced on the silver screen that flow into the consciousness of America will prevent the tyranny of communism from taking root.

True, Hollywood likes to tout a liberal cause. Movies bash big business and greedy tycoons, while promoting alternative energy, green agendas and vegetarianism. But there is one theme it loves even more -- Individualism. Hollywood can't help but glorify the lone wolf hero, the outsider, the maverick. And Americans can't get enough -- the guy who acts on his own, breaks all the rules and thinks for himself. Batman, James Bond, Indiana Jones, Rambo, Rocky, Forrest Gump. Their guiding self interest is the hallmark of individual freedom and is a bright beacon sure to keep the masses from crashing into the collectivist rocky shore..

There's some strong individual females too -- Scarlett O'Hare, Laura Croft, Resident Evil's Alice. You're not going to see them lining up in the state run bakery anytime soon. And After Color Purple, Glory and Amistad, any communist government who even thinks about directing an African American to work the state owned farm is going to have a riot heretofore unrivaled.

Does there exist a Hollywood movie where the central character was a hapless drone acting only for the good of society, with no sense of his own identity?

Consider the animations -- A Bee Movie, A Bugs Life, Antz -- all about bugs who don't want to be one of the collective hive. Happy Feet, a penguin whose strange dancing is ostracized but ultimately saves the colony. And Wall-e, a cute little robot who overcomes his "programming" to think and act for his own selfish love interest, rescuing humanity in the process. Hollywood produced these, and what's really funny -- they thought these were liberal movies!

Star Trek, a show with liberal leanings toward the Great Society, still showcased individual thought and action as virtuous. In fact, the most sinister villain in the Star Trek world was the Borg -- a collective of human/machines who were not allowed to think for themselves, and worked only for the good of the whole. And The Incredibles? Don't even get me started. Barry Goldwater could have written that script.

It's true that movies that bash the government and military are in vogue, but that message hurts rather than helps the communist cause. That's because distrust grows toward government of either party. More than 75% of the population distrusts the government regardless of who holds the White House.

These ideals of individual liberty, so engrained now in the American Consciousness, are poison to the collective society. Communism cannot survive unless it is fed with blind trust and abandonment of self. As long as Hollywood continues to make shows that glorify the individual and vilify central government, we are safe. And as long as Americans keep paying to see them, Hollywood will continue to make them. Capitalism at its best.

So everyone, go to the movies. It will keep America safe from communism, it's good for our market based capitalist economy, and it's a heck of a good time too.

FORECLOSURES CONTINUE TO GROW

I just ran a calculation: Las Vegas has been selling about 1800 foreclosures a month, but banks have been taking back an average of 3800. That means the foreclosure pool is GROWING by 2,000 a month. Based on the last five months of pre forclosures notices, we will continue this trend for at least the next five months.

Banks are going to have to continue to slash prices to move this inventory. I see another 20 to 30% drop -- maybe more.

Minimum Wage Increase Kills More Teen Jobs

3-07-09 Update: The Teen Unemployment rate is now at a 17 year high, at 21.6 percent, according to the Bureau of Labor Statistics. Research from the University of Georgia found that for every 10 increase in minimum wage, there is a decrease of up to 9% in teenage employment.

6-19-08: As you know, I adamantly opposed a minimum wage hike last year because history shows us a minimum wage hike costs jobs of the very people it is intended to help. Employers have to cut somewhere and the first to go are the young, minimum paid workers. Did that happen?

The Federal Govt passed a wage hike and not long after, unemployment began to rise. Coincidence? Look at who is filing for unemployment. According to Dr. Mark Perry, professor of economics at University of Michigan, unemployment increased a whopping 3.3% for 16 to 24 year olds, putting them at nearly 19% unemployed! Compare that to 25 and over who have seen virtually no increase in unemployment -- only .2% with a healthy 4.1% unemployed overall.

That's not the bad news: The minimum wage is set to rise twice more in the next year -- a 24% increase and the largest in history. The next President is going to have lots of young unemployed workers to deal with.

Maybe he can blame it on global warming ...

LAS VEGAS HOUSING IN A REVERSE BUBBLE

Home prices in Las Vegas continue to fall, and the month to month decline is accelerating. The average decline since the declines began in '06 is 2% per month. BUT, the average decline in the last six months is 5% PER MONTH! Whatever your property is worth today, it's worth 15% less in three months.

And I don't see a bottom any time soon. The price graph is a straight line down and has not even hinted to start to curve back up.
And with another record of pre foreclosure notices in January, we have at least four more months of record numbers of actual foreclosures. PLUS, realtors reported the other day that since the FHA moratorium ended a few weeks ago, the market is being flooded with even MORE foreclosures.

At this rate in these conditions, prices are going to drop at least another 20% and 30% isn't out of the question.

Man, how low can they really go? What is a theoretical worst case bottom? We've already blown by cost of construction. They can't go to zero.

GREED IS NOT THE ECONOMIC BOOGIEMAN

We've been hearing for a while now that greed caused this current economic crisis. Fiddlesticks.

We're all a little greedy, aren't we? We have so much more than just the basics we need to be happy (take a look at the Amish, who consistently rank themselves among the happiest on the planet). Going after anything beyond those basics is greed. Do you wear Calvin Klein instead of WalMart brand? Greed. Drive a BMW instead of taking the bus? Greed. Live in a 3000 SF house instead of a smaller home in North town? Greed.

Did you cause this mess because you sought a better life, a better house, greater status? Of course not. We don't consider it greed when we do it. We call it "prosperity." It has a nicer ring to it. "Prosperity" sounds ordained, like a blessing or reward for hard work. Greed just doesn't sound so good. Try it. Say it over and over a few times. "Greed. Greed. Greed." You just feel icky saying it, don't you?

The fact is it's easy for politicians to blame greed because it's a theme that sticks. Greed is a boogieman that political spinners use to tarnish systems that contradict their political philosophy. Greed makes an easy target. After all, it's one of the Seven Original Sins. And it aligns itself with an easily identifiable and attackable minority -- rich people. It's ok for us to try to improve our standing, but it's not ok for the rich to improve theirs. A reaction that Darwin would call a competitive survival instinct I think.

But we benefit from greed. Is anyone greedier than an entrepreneur who starts a software company with the hope that he can one day become the wealthiest man in the world? Yet along the way, he creates hundreds of thousands of jobs and spawns technological advances that make the world safer, healthier and more productive. Greed in that case, seems to work just fine.

When the national homebuilder, who (once upon a time) makes several billion dollars in profits, builds you a house, he sells it to you at a rock bottom price. It seems in his greedy desire to sell as many homes as he can, he has to lower his price to match or beat his greedy competitor across the street. And in so doing, he produces a high quality, low cost house you can afford, all the while putting hundreds of thousands more people to work. Greed still working.

When you buy your Escalade, your Prada, your Kobe burger, you are supporting jobs and helping the economy. You may call it prosperity, but it's still more than you need, and that makes it greed.

So if greed has helped us for the past 200 years become the most productive country ever, how could greed suddenly double cross us and bring us down? Are we to believe there was a sudden evil spike in "greedom?" Some sort of moral collapse where greed for the good of the whole suddenly gave way to greed for the individual? Or course not. Greed is self interested and individualized. Always has been. It is fairly consistent and fairly predictable.

And nothing has changed about humans in the past 24 months that made them suddenly more greedy. It would be hard to imagine someone wanting more than all the money and power in the world, wouldn't it? But even the greediest have brought benefit to our lives. Henry Ford's cars affordable for even the poorest, Thomas Edison's light bulb burning in everyone's living room, Michael Dell's computers for only a couple hundred bucks opening the doors of the internet in a stargate type leap forward.

The Wall Street guy who rounded up the money to lend you a mortgage on your last home wasn't any greedier than other titans of America. He wanted to better his life too. He wanted to take his kids to Disneyworld, give his wife a nicer diamond on their 10th anniversary and maybe upgrade his car to his childhood dream. He was looking for a better way to get you a loan in a way that benefitted you so you would buy your loan from him instead of his competitor. That's how America works. In his greedy quest to make the most money, Mr. Merchant has to always be better and cheaper than the next guy. He has to innovate, change, find new ways to help you. That's a great system. It provides the best, most efficient, most desired things we want (and need) at the best possible price.

So don't buy the political hype. There are some very rational explanations why our market is in the tank right now. But greed ain't among them.