Nothing Perplexing About San Francisco Real Estate Prices

A recent article on the rise in house prices in San Francisco in the San Francisco Chronicle elicited this closing comment. "Perplexing. What makes this city so impervious to the ecomonic meltdown of California in general?"

Well, as Homer Simpson would say, "d'oh." San Francisco may be the prime example of geographic areas in which there are "high barriers to entry" for real estate development, i. e., for various reasons increasing the housing stock by any meaningful amount is close to impossible. It may be environmentalists, it may be NIMBYs, it may be opponents of traffic congestion, it may be preservationists, or it may be building requirements that add tens of thousands of dollars to the basic cost of building a new home. But the effect of these forces is to make the cost of residential housing much higher than it is in an area not burdened by such influences, e.g., Texas. It should be noted that even during the dot com bust, Bay Area housing prices did not decline. so the effect of these artificial restrictions on housing supply is strong. It was only with the catastrophic economic downturn that we've seen housing prices in San Francisco and Los Angeles finally buckle. It would also seem that as the economy recovers, housing prices in high barrier to entry locales such as San Francisco, Los Angeles and Orange County should have a disproportionate price recovery. Certainly it'll be a long time before Adelanto, Palmdale and Murietta recover, but for the coastal areas of California, the recovery may be more vigorous than may be commonly expected.

Read more: http://www.sfgate.com/cgi-bin/blogs/ontheblock/detail?entry_id=50573#ixzz0VR8ClDQR

Medicare As An Example For Public Option

Amazingly, some supporters of the public health insurance option are pointing to Medicare as support to back up their position. While there might be some arguments for a public option, the use of Medicare as an example makes as much sense as using Octomom or the Gosselins as examples of good parenting. It's bad enough that Medicare is on track to go bankrupt due to its unfunded obligations. However tonight's 60 Minutes show contained an horrifying segment on Medicare fraud that even shocked me. I know how doctors game Medicare to supplement their reimbursements, and I've heard about clinics "hiring" homeless people for the purpose of performing unnecessary medical procedures and getting fat Medicare reimbursements. What I was unaware of is how Medicare pays scam artists billions of dollars for phony claims for medical products. These payments are made to "providers" of medical equipment and prescription drugs, who often set up shop it what turns out to be empty storefronts. All they need is the name, address, birth date and social security number of a patient (available for purchase for $10 per name), and they are free to submit claims for the cost of wheelchairs, artificial limbs, prescription drugs, etc., with reimbursement guaranteed within 15 to 30 days. Yes, there are after the fact audits, but by that time the scam artist has folded up his tent and opened a new one. One such scam artist interviewed said he had received $20 million in reimbursements from Medicare. A pharmacy was routinely reimbursed for an amount of prescription claims equal to six times the volume of the largest Walgreen's in Florida. Patients who receive these "benefits" do see them show up on their Social Security statements. Some even report these items to Medicare, but these receive little if any follow up. This is such easy money that street criminals have migrated to Medicare fraud. Sadly, this is just another example of government inefficiency. Politicians are always talking about weeding out government waste and inefficiency, about cutting the fat and preserving the meat. The trouble is that by its nature, government is incapable of operating efficiently. Government has no shareholders to watch the bottom line. If they're lucky, there may be watchdogs to reduce some of the waste. But that's the best one can hope for.

MTA Gold Line--Everything That's Wrong With Government

The Gold Line is an expensive train line that currently runs from Pasadena to downtown Los Angeles. Nobody uses it. The trains only go 20 to 25 miles per hour due to local noise and safety requirements, so it's not especially convenient. Indeed, the SCRTD didn't want it in the first place, knowing full well that it was not a key element of the Los Angeles master transportation plan. However, that did not stop San Gabriel Valley politicians from forcing a San Gabriel Valley leg onto the rapid transit map by mandate from the California Legislature. And why did the San Gabriel Valley politicians push so hard for a rail line? Not because anybody would ride it, but because they felt that their region deserved their fair share of the transit pie.

So the Gold Line was built and not surprisingly usage is well below projections. However, this has not stopped San Gabriel Valley politicians from demanding more. They have plotted the extension of the Gold Line to Azusa and then Claremont. And frighteningly they have just convinced the MTA to commit to the extension of the Gold Line and to seek federal funding. As far as I can tell, the Gold Line extension is just another version of the infamous "Bridge To Nowhere". Except that in the case of the bridge, "nowhere" was an uninhabited island in Alaska, while "nowhere" here is in sunny Southern California.

Of course, building useless transit systems is nothing new in Los Angeles. The Green Line stops a mile from LAX, and empty buses drive up and down the dedicated upper level Harbor Freeway roadway Private industry has equity owners who keep an eye on the bottom line. But nobody watches the bottom line when government spends on ill advised projects.

President Obama Wins Nobel Peace Prize

When I heard that President Obama won this year's Nobel Peace Prize I immediately thought of an item that ran in Mad Magazine about 1960. It was a fake news story announcing a forthcoming movie about the life of Paul Anka, who had scored his first hit record in 1957, and followed it up with several other hits in 1958, 1959 and 1960. The punch line was that the running time for "The Paul Anka Story" movie would be three minutes. Quite similarly, in the same way that 1960 was too early for a biopic on Paul Anka, 2009 is too early to award President Obama with the Nobel Peace Prize. Not to diminish Obama's accomplishments to date (whatever they might be), but this is as premature as deciding how to spend your lottery winnings before you buy a lottery ticket. What this year's Nobel prize does show to me is that the European view of the United States has changed overnight, doing a 180 turn from being looked at with suspicion, if not disdain, to one of admiration, which certainly is not bad. And somewhere in there I think there's a message to George W. Bush. Perhaps he deserves a separate honor as Nobel Enabler.

Walking Tour Of Nashville

The original plan was to drive the two miles from the Holiday Inn at Vanderbilt into downtown Nashville. But the clouds provided protection from the sun, plus I noticed that Music Row was halfway between Vanderbilt and downtown, so I decided to walk instead. I was looking forward to seeing Music Row, since it is the heart of the country music industry where hundreds of record companies and country music related endeavors were located. I was imagining it was in downtown with shops, nightclubs, museums and buzz of activity, like Tin Pan Alley in Manhattan. Was I ever mistaken. Music Row is two parallel tree lined streets, four blocks long, and the functional equivalent of a business park with low and mid rise office buildings. No retail space, no foot traffic at all.

Trudging downtown I headed east on Broadway, past the historic Union Station coverted to a Wyndham Hotel, then by the Sommet Center area (Kiss is coming to town on a Predator's off night.) Then turned north and passed by the original Grand Old Opry venue, Ryman Auditorium. Then walked up to the State Capitol and related state government buildings, mostly Greek style architecture. From there I decided to head towards the Cumberland River, as I noticed several bridges on the map that spanned the river. On my way there I ran into a good part of what I was looking for in Music Row. Along Second Street and the eastern part of Broadway there were the country music nightclubs, guitar shops and museums that I had visualized, just without the music industry venues.

Going a block east of Second St. I came to the Cumberland River, and on the other side I see this large stadium. Then it dawned on me. The Tennessee Titans, who started out as the Tennessee Oilers temporarily located in Memphis, were based in Nashville. Looking a little bit south, I saw a bridge that was carrying only pedestrian traffic. This had to be the Shelby Street pedestrian bridge I noted on the map. I looked for the entrance, not finding it until 3rd or 4th street. My first thought was that a pedestrian bridge was an extravegance. But then I concluded this was probably an old bridge that used to carry vehicle traffic, but which was later replaced by a parallel larger bridge a couple of blocks away. However, then I saw the plaque saying that the bridge was dedicated in 2003, so that blew up my theory. As I headed on the bridge, looking ahead and becoming visible once again was LP Stadium, home of the Tennessee Titans. Of course! They built the bridge so people could walk to the games from downtown Nashville.

Walking back to Vanderbilt, it started to rain lightly. I did stop by the downtown Holiday Inn to rest, and to check out the facility since I had almost booked that hotel instead of the Vanderbilt location. I made the trek back and arrived at the Holiday Inn Vanderbilt four hours after I had left. That's my exercise for this trip.

What's Wrong With USC?

Well they're still ranked #10 and certainly could easily win the Pac 10 again, as prior year stumbles have not detracted from USC ending up each season as one of the best teams in the country. But this year something might be different. The offense is having trouble putting up points and against Washington, USC did not make the game winning plays that we're used to seeing.

Before the start of the season, the outlook was for USC to have a terrific offensive team with the entire OL returning, perhaps the best in the country, plus an incredible stable of running backs. On the other hand, losing almost all of their defensive starters, the USC defense was a question mark. So the USC inability to score, barely 30 points in two games against apparently less than stellar defenses, has been highly puzzling. After deep reflection, it seems to me that the answer may be at QB, or the lack of a QB. In looking at USC's amazing run the previous seven seasons, they have been blessed with talented and experienced quarterbacks. Even when breaking in a new starting quarterback, it's been a John David Booty or Mark Sanchez who served a three year apprenticeship before becoming a starter, coming in to take over the reins. This year didn't look to be any different, with third year sophomore Aaron Corp seemingly ready to take over. But perhaps like his equally highly regarded high school contemporary, Chris Forcier, now second string quarterback at Furman, perhaps Corp isn't the answer, and that's why maybe Pete Carroll took the shocking step of pegging true freshman Matt Barkley as #1 QB. With teams daring SC to throw the ball with 8 man fronts, even talented USC OLs and RBs haven't been able to consistently run the ball, griding out gobs of rushing yards on some plays, and next to nothing on others.

Of course, the game winning sequence for Washington was the last second drive for the go ahead field goal. In this context, it was on the USC defense to stop Washington. USC's defense has been surprisingly good, with new defensive linemen and linebackers stepping in to field a solid defense. But when it came to crunch time, this defense may have been better then expected, but at this point it is not nearly as good as the previous defenses, as hinted by its inability so far to create turnovers. It couldn't stop Locker on 3rd and 15, and it couldn't stop Locker from moving deep into field goal territory. It was good enough to stop Washington from scoring a game winning touchdown at the end of the game, with Luthur Brown's crushing hit on the Washington tailback causing Luthur to celebrate like it was 1999. But I guess he didn't realize that a game winning chip shot field goal coming up on the next play would have the same effect. So to that extent, the SC defense just did not do its job.

Effect Of Recession on New Chinese Restaurants

Remarkably, the recession has not seemed to have affected the number of Chinese restaurants operating in the San Gabriel Valley. Yes, restaurants have ceased operation, but in almost every case a new Chinese restaurant shows up to take the place of the one that closed down. This is evidenced by the relatively small number of vacant restaurant locations in the SGV.

However, there is now one sign that the recession might be taking its toll. We're now seeing planned new branches of existing successful Chinese restaurants scrapped or on extended delay. The sign indicating a branch of Hunan Seafood at the old Red Ant Cafe location on Valley Bl. in San Gabriel is no longer in the window. The return of Lu Din Gee to San Gabriel at the vacated Newport Seafood location is taking forever, with the construction site in disarray. And there is no longer any indication of Jazz Cat Cafe opening a branch in Fortune Plaza on Valley Bl. in San Gabriel across from Hawaii Market.

Indeed, the newly opened Fortune Plaza is an especially sad looking place. Most of the space is empty. There is a Yogurtland at the back of the Plaza, but I might have been their only customer today (the trash bins were empty), as it is inconspicuously located and hard to find. Given how crowded every other Yogurtland is this is quite unusual. Of course, as somebody pointed out, how many malls are anchored by a Yogurtland?