Kilo, Mega, Tera

I do believe we are about to get yet another foreclosure here on my street in Elk Grove.

A couple bought a housal unit here on Moonlight Way in about 2003, yet moved out of town in 2007 (to a better, more exclusive place no doubt). They opted not to sell...how could they in 2007? So the rental began. After a year and a half of renting the tenants packed up and moved on, leaving the couple today with a second mortgage payment.

I last saw them a few weeks ago, helping the guy strap down a chest freezer he was hauling to their newest home in another county. Their tone of voice said it all: "We don't know...(long pause)...we might just sell it or rent it out again..."

Codespeak for "The keys are already in the mail."

I am aware of several people around me who were dumb enough to buy in 2003-2006 but smart enough to have purchased a second house in late 2007/early 2008 after the asset bubble had burst, only to abandon their first home and its underwater mortgage. This is clearly the most desirable economic thing to do. I fully admit, had I also fell into the speculative frenzy of housal unit flipping, reaching for a drink from that chalice of easy-money -- leveraged real estate -- or fell into the bigger debt trap of a better, newer housal unit (with its larger mortgage), I absolutely would have been one to do the same thing. Absolutely.

Imagine what more would come if credit was still as easy to get as it was five years ago. Alas, but it almost is! Perhaps you weren't aware that the recently extended $8,000 federal credit to spur "new" owners to buy a housal unit can be used as a down payment. That is, keep allowing people with no skin in the game to keep playing the game. That the statistics say that the 2001-2006 no-down-payment 'programs' resulted in higher default rates apparently doesn't register with current policymakers. That the remote possibility of further housal unit value declines and the remote possibility of further unemployment might spur these late entrants to also say fuck it and walk away also hasn't registered with current policymakers.

I don't really care much about all this...the results, that is. I highly enjoy thinking about the possibility of financial implosion if only because I think I'm much, much better positioned to survive any financial calamity. As an electrical power engineer I often think in large numbers (kilo, mega, tera) but I no longer even know how many zeros are in a trillion anymore. If forty is the new thirty, a trillion is the new billion.

I can't say I don't really care much about all the foreclosures around me, though. I do care. It's not that my own housal unit value might decline -- I could really care less about that; what bothers me is that the endless cycle of people in/people out cannot possibly lead to any real sense of community (not that low density suburbia has any hope of that to begin with). I cannot live in a vacuum regardless of how financially stable I might personally be. I am better off than most, I believe, through lifelong prudent fiscal responsibility, but that doesn't mean I could live correctly without a stable community for reciprocal support.

This isn't something anyone else thinks about. I believe it prudent to consider the remote possibility that things aren't going to immediately get better. We are all beginning to believe that this is was just some sort of V-shaped recession, now with a 50% return of the stock market and 3.5% GDP growth. Give it another eight months, following that logic, and we will be at 100%, having not lost any nominal stock value with growth at 7% with all our former problems passed away.