Real Estate Stinks!

I woke up way too early on a Sunday morning, and since all the buzz in India and back stateside has been on the real estate market, I was curious what the historical returns on residential real estate have been. While no data exists in India, I found a study for the US, from which I reproduce this graphic on nominal and real (i.e. inflation-adjusted) returns. Nothing to write home about.


Source

To be fair, this study does not appear to factor in rent savings, which could be substantial. My own experience with online calculators is that there is a huge disparity based on assumptions, so do your homework. Nevertheless, it is useful to consider that home price inflation has only barely beat inflation in much of the US, a far cry from the 10-20% annual returns we have seen recently.

Click! Streets of Chennai, India

With my new camera, I'm hoping to take a lot more random pictures, and since I'm on vacation in my hometown of Chennai, India, here are some of the clicks I took today.





What easement? This is Chennai - all that separates traffic from construction is an asbestos sheet. The construction BTW is for the Kathipara junction, which will be Madras' first junction with multiple roads crossing over in different directions!




Since no one seems to follow the lanes, it looks like in some cases, the transportation dept just did away with the wasted paint. Incidentally, this is remarkly unchaotic for Chennai - I need to take a picture of a real Chennai street!

Seatbelt anyone?

That's a view of the Olympia Tech Park, which I'm told is the largest building in the world to get the LEED gold certification. I need to go and visit this. I read online that only 12% of the property is built up, with 88% designated for extensive landscaping in process. That would be stunning in an area where land prices are at about Rs 4-5 million a ground (~ $2 million/acre!!) and have gone up 50% in the last year!

Click! Views from my car on VA-24

As I drove back to Virginia from a trip I had taken, I found myself in a simply incredible fog and snow storm. Here are some pictures from the car. I took this pictures as I drove - don't try this in your car!

Did You Know: "Magic Bullet" theory of JFK assassination

I'm watching PBS as I work, watching a show called Oswald's Ghost, and I was surprised to learn that the person who first proposed the theory that was later derided as the "magic bullet" theory was the Ranking Member of the US Senate, Sen. Arlen Specter (R-PA). If you don't know what the "magic bullet" theory, you have to watch Oliver Stone's brilliant movie, JFK, starring Kevin Costner and Tommy Lee Jones.

Zinger of the Day: Pandering to the Latinos

Ruben Navarrette Jr. rants about politicians attempting to pander to Latinos and use silly generalizations assuming the Hispanic community is one mass. Here's a dig at Hillary:

Hillary Clinton got off to a rocky start. While chatting with Hispanic voters in a Mexican restaurant in Las Vegas, Nevada, last week, she stretched for an analogy to explain how all Americans are connected and their problems interconnected despite the fact that "we treat them as though one is guacamole and one is chips."

Aiy caramba! Quick rule of thumb: The nation's 46 million Hispanics are a proud people who have accomplished a great deal, have fought and died for this country in every military conflict dating back to the Civil War, and who embody the American Dream. If you're a politician who is trying to relate to them -- but your own knowledge of the group doesn't extend beyond whatever is on the No. 3 combination plate -- you want to be careful not to be so tone deaf that you wind up insulting them.

US Downgrade?

In the midst of much populism on one end and paranoia on the other end of the presidential campaign, few people paid attention to a cataclysmic headline: Moody's argues that rising debt obligations could lead to the United States having its credit rating cut from AAA. Now, while some of this is saber-rattling, the fact that a rating agency would even dare to talk about it is pretty phenomenal, and reflects the huge entitlement obligations (Social Security, Medicare, etc) that is promised by the US Federal govt. I have previously reported on some amazing slides from the Comptroller General showing just how large this obligation is. Debt is $411,000 per household, with entitlement spending expected to outpace GDP growth several times over. This clearly isn't sustainable! And yet, few presidential candidates are talking about it in more than generalities. Contrast the $46 trillion debt burden with spending by most agencies, and you realize the big threat isn't spending too much money on the Environmental Protection Agency, it's running with a social contract that isn't viable any more!

Talking on a Cell Phone as Bad as Drunk Driving?

Stunning research at the University of Utah driving under the influence of a cell phone is just as bad as doing so under the influence of alcohol. Participants drove simulator cars while sober, drunk and distracted and their performance in each test case was considered, and it was found that they were actually more likely to crash the car when distracted by a cell phone call than when drunk with a blood alcohol level of 0.08 (the legal limit for a DUI).

Interestingly also, they found no difference in driving behavior when using a handheld cell phone or a handsfree device! Cell phone users were over 5 times more likely to get in accidents than undistracted drivers. And they found cell phone users may also cause traffic backups due to their slow speed and poor lane changing patterns.

Wow, time to think of hanging up that phone! I don't talk a lot on the road, except when I take long trips on the interstate, but that's partly because I've been living in a university town. As I look to move and work, that might change, and suddenly the productivity drain seems a shame.

Picture of the Day: China Pollution

From the Switchboard, a blog by the National Resource Defense Council, comes this picture of pollution in Beijing. Eric Young wonders if the marathon during the Olympics will have to be moved out in the country.

Say No to Plastic Bags

I never thought I'd be applauding China for being the vanguard of environmental progress, but here goes: the China has banned free plastic bags at grocery stores. The even bigger surprise? Merchants and customers alike are all for it! Way to go!!

The Indian Expert on the Hoods

Columbia university sociologist Sudhir Venkatesh's work formed a chapter in the book, Freakanomics. Now he's got his own book, Gang Leader for a Day. While I haven't read the book, this interview reminds me how interesting his work is. Think: if drug dealers are so successful, how is it that most live with their mother?

As I read the interview, it is sad to see how much we miss with a merely criminal view of gangs, ignoring the social causes.

An excerpt:

There is significant exposure to lead and asbestos and extremely poor nutrition. One of the most jaw-dropping experiences I continue to have is to walk into a grocery store in the inner city. There's a lack of fresh food, decent food.

And another:

It's depressing to see the cycle of failure and the reproduction of poverty. The typical story goes like this: Job is going well, then their kid gets sick. They start missing work, then they get fired. It just makes you want to scream. We're talking about the folks who are trying to help themselves, and they can't do it. That's another kind of sadness.

Brooks on Obama and McCain

David Brooks contrasts the two candidates appealing to independents - John McCain and Barack Obama. I particularly liked this quote:

In policy terms, [Obama] is an orthodox liberal. He never tells audiences anything that might make them uncomfortable. In the Senate, he didn’t join the Gang of 14, which created a bipartisan consensus on judges, because it would have meant deviating from liberal orthodoxy and coming to the center. How do you build a trans-partisan coalition when every single policy you propose is reliably on the left?

This is one of the things I love about McCain:

McCain’s campaign events are unpredictable. At Obama events, the candidate gives a moving speech while the crowd rises deliriously as one. McCain holds town meetings. People challenge him, sometimes angrily. And if they oppose him, McCain will come back to them two or three times so that there can be an honest exchange of views. Some politicians try to persuade their audience that they agree with them. McCain welcomes disagreement and talks about it.

Cricket Vid: Oh What a Mash!

I never thought I'd be blogging about cricket the night after the New Hampshire primaries, but some horrendous screw-ups in a recent Test match have got me quite riled up. Thanks to Web 2.0, even an Indian living in the US can now pull up a neat documented collection of the incompetence of the umpiring!