June 2009 Archives

The annual National Association of Realtors survey has been released and maybe we can hope that the news will get some folks out of the industry so the level of professionalism increases and the income potential improves.  Interestingly, in the survey 27% of the respondents indicated a significant amount of doubt that they will stay in the business another two years.

Frankly, why would they choose to stay in an industry where the average Realtor earns $36,700 and the average age is somewhere north of mid-century?   The average income in a Realtor's first two years is a whooping $8,600 and the most experienced agents, in excess of 16 years experience, are averaging earnings of $53,900.

Then there is this statement from NAR's managing director for real estate research.  "Almost all of our members have secondary business specialties and are diversified in their income streams........some are involved in related businesses."   This is also why finding full-time Realtors is a difficult pursuit and why the level of professionalism suffers.

While I am a Realtor, and probably will receive criticism for voicing the obvious regarding levels of skill in the market; I offer the above as an explanation.  An explanation as to why you find technology taking over in real estate and the personal touch harder to come by.  Why there are specialists, whose income far exceed these averages, who create substantial companies providing a unique service.  Why if your loved one tells you they want to get into real estate you better stick this post in front of their noses and beg them to become a technologically proficient specialist and expert. 

Otherwise, you probably want to learn how the food stamp system works.

Our federal government does have experience running formerly private businesses.  Thirty eight years ago the US Government took over all passenger rail systems in our country.  The National Railroad Passenger Corporation, also known as Amtrack, gave us a lesson in how well the government utilizes business principles for running enterprizes.

One of the main issues I have with government run entities is they are not limited like the rest of the world to capital limits.  In other words, we can just run a government owned company as long as is desired by Congress and the Executive Branch, at a loss (that means our tax money) and if it is politically desirous to do so, just keep funding the entitiy.  Politicians have to run for election so they like to share with us all the reasons we should allow this to occur, national security, economic stabilization, or just simply, we expect profits in the next few years.  Anything sound familiar here?

When Amtrack was created, all of these arguments surfaced including a government forecast that the passenger rail system would be profitable in three years.  Thirty eight years later, the taxpayers original $340 million investment is now $380 billion (this means funded losses with taxpayer money)..and no end in sight.  Why?  Because too many jobs are dependent on the money-losing system.  There are no economic principles to bear..no accountability or desire to spend our money in a profitable fashion.  No, this nationalized rail system is another political tool now used to keep entrenched politicians in office.  Show the world how to run it profitably, and private entities would fight over the opportunity to purchase it fromt the governement.

This week we witnessed another Amtrack in the making.  The nationalization of General Motors (now known as Government Motors...by me) is nothing more than a bad excuse for a bad business model.  I won't even address the give-away to the unions but believe me..union members vote..big time!

President Obama now runs a company much larger than any previous community organizing efforts his career has allowed.  The federal government owns 60%, the UAW 20%, and some private bondholders the balance.  As I argued in posts last October and November, the automobile companies needed to use the bankruptcy system to restructure their business models.  Of course, that has happened but for entirely different reasons.  The restructuring is not to create a profitable company with reasonable labor costs..it is to screw over private debt holders and start down the course of creating cars that frankly, the majority of Americans are not going to buy.  That is a whole separate issue...if you drive a SUV you do it because you need it for your business or family. 

Guess what President Obama??  I have five kids...I need my Suburban!  I WILL NOT be buying any of these new effieicent cars "America needs".  Maybe when I do not have kids anymore but I kind of like my big vehicle.  I will not be surprized when other car makers (pity Ford but they have a huge opportunity here if they can stay away from the government trough) decide to offer the vehicles most American lifestyles demand.  This is what good ole American enterprise and capitalism use to be about and I believe will be about again.  It is a force much larger than this current government.  Mark my words, the people will speak again and I expect it to start very soon.

Do you really believe government can run any entity better than the private sector?  Does government have an obligation to its constituents to make prudent financial decisions?  Does this one qualify?

A local automobile dealership in Mertztown PA.  The big problem is will you buy a car from the company you now own?

One of my favorite blogs to read daily is www.businesspundit.com.  A dose of unusual can be found and Friday's post really had me amazed. The first one is almost unbelievable..the Dog-O-Matic (you will have to click through to see what I am laughing at!).  Then..if that is not wierd enough for you scroll down to the School Girl Panty Machine.  I do not even want to imagine....