The Ponzi Scheme spawned a societal sense of entitlement. It is likely that social safety nets will be created and enlarged to pander to this new demand.
Asking Price: $2,128,500
Address: 33 Ridgeview Irvine, CA 92603
So he chased the wind
Thats all his silly life required
And the days of vanity
Went on forever
And he saw his days burn up
Like paper in fire
Paper in Fire — John Mellencamp
Major cultural events like The Great Housing Bubble change people’s lives. The populace built mountains of paper through burning consumerism; paper that is now smoldering in the ashes of our economic fire. Statistics measure the economic fallout, but more interesting is the impact on the people.
One trend in our consumer society has been an increase in our collective sense of entitlement. People came to believe in the permanence of the supply of consumer goods they enjoyed, the exaggerated sense of self-importance they created, and the unsustainable level of lifestyle spending they deserved. Since this sense of entitlement was only enabled by a massive Ponzi Scheme, many people in the aftermath must adjust to a new lifestyle that is considerably less affluent than the one to which they feel entitled.
Rather than retreat from a sense of entitlement, it is likely we will enact even more social safety nets to pander to this societal desire. Good or bad is in your perspective. Many European countries are suffering less because they have an expensive safety net that supports those in need. The European Socialist model may prove less traumatic to the society and the economy because the safety net provides liquidity and consumer demand — at a tremendous cost. With Democrats in full control of the House, Senate and the Presidency with a filibuster-proof majority, nothing stands in their way. We will almost certainly take a step toward Socialism.
These circumstances have precedence. During the 1920s, laissez-faire economic policies with little or no financial regulation resulted in a massive Ponzi Scheme in the stock market, widespread currency deflation, and a near collapse of our economic system. the deflation of that credit bubble was exacerbated by the passage of the Smoot-Hawley Tariff Act (enacted June 17, 1930) which decimated international trade. The resulting Great Depression saw a dramatic political shift with the landslide election of FDR in 1932 and the creation of much of our current and inadequate safety net; it was our first step toward Socialism.
Since the conditions now are so similar economically and politically, it is reasonable to expect the same response. Many of the social programs Conservatives fear most will be enacted or expanded. If these programs fail in the eyes of the electorate, Conservatives and Republicans will come back to power to “fix” things; however, if Progressives and Democrats succeed, they may consolidate power for a generation.
When I saw today’s featured property with only two pictures of the same view, I saw the artistic value in the presentation.
Asking Price: $2,128,500
Income Requirement: $532,125
Downpayment Needed: $425,700
Purchase Price: $3,880,000
Purchase Date: 12/11/2006
Address: 33 Ridgeview Irvine, CA 92603
| Beds: | 5 |
| Baths: | 6 |
| Sq. Ft.: | 5,900 |
| $/Sq. Ft.: | $361 |
| Lot Size: | 0.28
Acres |
| Property Type: | Single Family Residence |
| Style: | Other |
| Stories: | 2 |
| View: | Bay, City Lights, Mountain, Ocean, Panoramic |
| Year Built: | 2006 |
| Community: | Turtle Ridge |
| County: | Orange |
| MLS#: | P696338 |
| Source: | SoCalMLS |
| Status: | Active |
| On Redfin: | 2 days |
kitchen located behind the open family kitchen. Downstairs bedroom
perfect for guest/maid/mother in law. Main floor study, living room,
dining room, laundry room and family room. Upstairs family room in
addition to bedrooms. Unbelievable views from the master bedroom and
bathroom. Sold As-Is with no warranties expressed or implied.
The banks can’t be looking forward to taking back more properties like this one… This property was purchased on 12/11/2006 for $3,880,000. The owner used a $3,000,000 first mortgage and a $880,000 downpayment. A week later he opens a $350,000 HELOC, and a year later he expanded it to $477,000. These are probably just HELOCs to access money, and they may not have been used.
Then, this happened:
Foreclosure Record
Recording Date: 07/09/2008
Document Type: Notice of Sale (aka Notice of Trustee’s Sale)
Document #: 2008000326533
Foreclosure Record
Recording Date: 03/31/2008
Document Type: Notice of Default
Document #: 2008000148091
The lender finally took the property back on 1/21/2009 for $2,635,000. They have been sitting on it since then trying to figure out what to do. Based on the date of the NOD, there has been no payment on this loan since 2007.
At the current asking price, if the property sells and a 6% commission is paid, the total loss to the lender will be $999,210. Let’s call it a million.
Stunning Astor Court model located on the second floor with a view of
Daniel Young, President of Community Development for the Irvine Company
