Who Am I?
Chuck Ponzi November 19th, 2007
While much more than a philosophical question, the answer and what you say more often reflects not just who you are, but the character you carry with you.
Since I moved my blog over from Blogspot, I have wanted to put pen to paper and give just enough background on the author of the blog to provide some dangerous information, but not enough to provide enough clues for any given person to guess who I am. In reality, there are only a couple of people who know who I am as a real person, and I’m just fine with that. I never intended the blog to be a springboard into fame, nor was I trying to make a business out of it (trust me, the pitiful revenue the blog generates wouldn’t provide more than an occasional lollipop it seems in Southern California.)
About Me
Well, my story is too long for a blog entry. I didn’t originate in Southern California, but rather the midwest, though I haven’t lived there for more than 15 years. I have lived in SoCal much of my adult life (after University studies), and have lived in North LA County, Central LA County, San Diego, and Orange County where I currently reside with my wife and 2 kids. I studied Accounting and Information Systems and have a Bachelor’s Degree from one of the top schools in the US (can’t give too many details). I also earned an MBA since being in California in the past few years. I am in my 30’s and have also lived in diverse places such as Germany, DC, Utah, and Hawaii and I speak 2 languages fluently This has given me a unique perspective on language and how it reflects and changes our attitudes about life and surroundings; a window into our social makeup.
My wife… I don’t talk about her much, but it only seems fitting to give her a worthy run through. She is the most important person in my life, and so therefore deserves a place on this blog; not in name, but because she has supported me in all that I have done, even sacrificing personal beliefs and time for our family’s better good. My wife grew up in the intermountain west, and holds a Master’s Degree as. She speaks 2 languages fluently as well (not the same as mine, but she is teaching me bits and pieces of hers) and is an entrepreneur as well as stay at home mom. She truly is amazing; I got very lucky. She has lived in all of the same places in California that I have.
With that said, I started thinking about writing a blog in early 2004, although it took me nearly a year to put that plan into conception. In truth, I thought homes were overpriced already in late 2002 and early 2003. By mid 2004, it had become unbearable, and since I was itching to move onto another company, I convinced my wife in the Summer of 2004 that housing was overvalued and we had better sell our place; even before I had another job. Our place sold in exactly 3 days for a couple percent over asking price, and more than double what I had paid for it a few years earlier. It was insane. We even had one bid more than 20k above that, but at 100% financing. We chose the more prudent buyer because we feared not closing in time. It’s funny in hindsight. Housing Bubbles take years to pop.
Over the next 6 months, we resituated ourselves, moving closer to LA and taking a job in Beverly Hills. It was a nice move, but we both knew it was only temporary. It was during this time that I first started the socalbubble.blogspot.com blog. My primary inspiration was Rich Toscano, of www.piggington.com fame. I had no desire to be known, and only told a few people about the blog. I was fine to be anonymous, because, frankly, real estate had become a religion to most of the people we knew. It was as if I was attempting to hoist their savior up on a cross when I dared to even consider that housing had ever fallen in value in the past, or that it could ever fall in the future. “At worst,” one friend assured me, “it will only go up by 10% per year. That would be a terrible year.” Conceding defeat of trying to warn those close to me, and finding that noone wanted to know the inconvenient truth, I started a blog to just spill out my feelings and try to put things in context in my life. At first, the only visitors were there to ridicule me. Some sent me harassing emails, some just quietly told me how stupid I was and left. Either way, it seemed that there were only a few out there who would believe that there was a bubble, or that it would ever burst. I read Patrick.net, Piggington, and The Housing Bubble Blog daily and scoured news stories to try to piece together what would happen; I read historical economics treatises; I pored over more historical economic data than I care to admit. I was convinced, but noone else was. At times, I thought I might be going crazy myself. Noone I met would agree with what I thought was self-evident. Most people who should have known better just ignored what was going on.
It only took time. I changed my name from John Doe (my old screen name) to Chuck Ponzi when I moved to my own hosting and domain, to pay homage to the man who defined our current economic system (with stamps, no less).
Still, this was supposed to be about me.
What lies ahead for Chuck Ponzi? Even I don’t know. Will I buy again in Southern California? Who knows?; I may move before that happens, but an opportunity may present itself in the future too. Either way, moving has been both about good and bad. While many of the families in our age group that we have known in SoCal have since moved out of state or are planning to do so in the next year, we have remained noncommital to our future as Californicators.
I guess we represent much of what we thought California was, middle class families committed to our children’s future and our own personal responsibility. It is perhaps fitting that we are a dying breed here in California. Even if we leave, in a few years, there will be another group of people ready to take our place. I hope them much more success than we have had in living the American Dream. We have found that the price for that dream was much more than we were willing to give. And, for many trying to buy it; have found that it was much more a personal nightmare than the dream they (with their commissioned agent and loan broker) dreamt of. I could in some ways feel justified that I did what I could to warn, but rather, I feel saddened that most had no idea what was about to happen. Sometimes, when I’m feeling down, I walk around my neighborhood and see the Hummers, Mercedes and Lexuses, and then I’m not sad anymore. At least everyone got awesome rides.
So, by definition, who am I?
I am Chuck Ponzi. Welcome to Southern California.
My contact information can be found here.
I don’t recall whether I’ve written you Chuck, but I, too, was a lone voice in 2005 calling for the demise of the bubble. I wrote about it extensively in my client newsletter, but was, unfortunately, not in a position to sell and move. If I was in my 30s I might have done it, but I’m too established and moving is such a pain. I looked at my wife and said, “Honey, we can sell and move today or do so 15 years from today, because we won’t see these prices again for at least that long.” Family, business and the fact we weren’t quite ready to retire kept us here.
We did, however, exchange two vacation town homes for commercial property in TN. That’s worked out quite well, so far, even if not perfect.
I’ve been reading your blog and a few others more regularly, just to get a feel for what’s going on elsewhere. I can tell you that the San Fernando Valley looks like it’s heading into the equivalent of mid ‘92, when prices last began to fall off the precipice. (No, I tell clients, it wasn’t the earthquake. Prices were already down 25% or so by that date, stabilized for a year or so, then fell the final 10% into ‘96.)
Keep up the good work Chuck.
Doug Thorburn, EA, CFP and addiction researcher
I too am an information addict.
I noticed the depth of your analysis in your “John Doe” life
I know you don’t post often, but you are the first of a dozen related sites that I check daily.
I’ve been a lone voice amongst family, friends and customers for the last few years.
Thank you for confirming I am not crazy.
To my humble ears, you sound like you ARE living an American Dream in California.
As historians understand, there are several histories of the United States. If you read books about the US Suffrage Movement that were written in the 1950’s, you see: Yes, there were some things they got exactly right. And there were some things that they left out, ignored, undervalued, dismissed, and overstated.
Similarly there are histories being spun now about the Resilient American Consumer - the globe’s 21st Century savior. That’s just the working myth, though.
There is also another history being written: about the people and families all over the country (and yes even some who live perpetually in a ‘golden state’) who think about their children and what it will mean in the future to be an American citizen in a “globalized” world.
These people will want their kids to grow up fully understanding the Malthusian pressures on the globe’s limited resources that Western Civilization has been able to hold at bay through the manipulation of capital for so long.
There kids will accept that these pressures must be reckoned with now through fairness, justice and equity, not salved by more and more consumption and dismissed through casual racism. They will be new pioneers of those liberal principles – what got us here.
These kids will become Americans who didn’t just go to the university to graduate into one of those “Little Boxes” – but be soldiers who will reestablishing America’s prominence in the world and protect the our planet from ourselves.
Those people, those families will wield influence in America again. Those people are all that America has left. When all is said and done, those people will be the only ones capable of finally defining what “American Dream” should really mean.
“When the US catches cold, the rest of the world catches pneumonia.”
I was reading a British guy’s blog the other day. He works for the BBC and he was talking about how the rest our credit crunch/housing sector will affect the rest of the world, based on American consumer spending. I find it interesting that Problemwithcaring brings this same topic up with “Similarly there are histories being spun now about the Resilient American Consumer - the globe’s 21st Century savior. That’s just the working myth, though.”
I’m not sure how much of a myth it is… mostly because we drive not only our own economy, but others, because of our trade deficit… You can find the next quotearticle.
“Will Americans slowly raise their savings back to a normal historical level – 5 to 10% of income, say? That would represent quite a big adjustment for the world economy. Remember the US is 25% of global spending, and US consumer spending is probably about 20% of the world’s total demand. Saving 5% of that, is like a 1% reduction in global demand.”
You also put a lot of faith in the next generation, something I personally find apalling. This has been a problem, is that people depend on the next generation to fix they problems they have made, instead of being proactive or taking care of it themselves.
Thanks to the generations before me I will have no social security, and yet I still pay into it; I will have to make up for the HUGE national debt; I will have to face depleting national resources; high energy bills; fix global warming; and I will spend most of my life working, because I won’t be able to afford to retire.
“There kids will accept these pressures” is not a good concept, it’s a horrible ideal. As the next generation, just starting into the work force, I can’t tell you how upset I am and strained I feel about having to fix problems I didn’t create, because the generation before me couldn’t control their own consumption habits. Not only that, they taught these same habits to their children! So now there are more people out there who grew up living a certain way and will want to continue living the same way.
I am mortified that there are people out there like you who are STILL holding on to this hope that your children can fix everything. Never put off until tomorrow what you can do today. If you feel overwhelmed today, how do you think your children will feel when they are your age and the problem is that much worse?
Yes I think my generation will have to fight to fix these things, but the burden is huge and we were pushed into being soldiers. I am proud to be an American, but I am dissappointed in the generations before me, and I can only hope that there are more people like me, than like the generation before me who want to push burdens onto their children. At 23 years old, I feel the pressure already, and I still feel that the “adults” aren’t listening, or making changes…
I pretty much agree with all you have said. But I am starting to worry that this bubble implosion may become more than housing issue. Since US has grown addicted to imported capital for consumption for over two decades now, this implosion has the capacity to destroy us as a nation that we know as (in the post WW2 sense). I am worried whether some unraveling in the fashion of Soviet Union is possible. I have been a believer in the British model of dissolution of the empire; but now I am growing pessimistic. If Citi, Freddie, Fannie start going under, we may have a loss of faith in US $ that can quickly run us asunder.
About time you put something up! Us housing bears were probably in the closet for years before we outed ourselves. After years of being amazed to what I was seeing around me I started scraping historical data out of Domania back in the early spring of 2002. I didn’t know what I was going to do with the info at the time. It took me a while, but it wasn’t until late 2005 that I discovered bubble blogs and realized that was a great way to address what I was seeing.
Anyway, glad to see you are a normal person, like most of us, without a raincloud permanently drifting directly above your head.
In my neck of the woods (Redondo Beach), there have been 2 home invasions very recently. In the more recent case, the police think that the criminal was “enticed by her high-end cars.”
Like you, we have doubts about our future here. As much as I love the awesome year-round farmer’s market in Torrance, we don’t think our future lies in So Cal. I don’t rule out the possibility that the socio-economic landscape could change so much that it becomes a much less desirable place to live - at least for the middle-class.
Just came across a chart showing the actual value drops for San Diego California condominiums from 2005 to 2007.
This is a real eye opener! View at:
http://www.brokerforyou.com/brokerforyou
Things will get extremely bad in the next 2-3 yrs or so but that is the price we pay for years of irrational exuberance. When properties crash 40% or more hundreds of thousands of families will be destitute. But why should this be such a surprise? Isn’t this the expected consequence of callous spending with utter disregard for financial responsiblitiy?
I know so many who extracted home equity to buy BMWs and Lexuses that they could not even dream of affording on their income alone, cash in the home equity and live it up for the moment was the motto.
Nice to read this blog, I post occasionally on other blogs but mostly lurk. I’ve always like your posts from the other places, usually very well thought out.
I’m a native of So Cal and left last year after a job loss in ‘05 and coming thisclose to foreclosure when I couldn’t make the payments, I managed to hold on with savings and temp jobs, I couldn’t find anything permanent. While I loved growing up and living in So Cal I came to realize that this housing bust was different from the others I experienced in previous years. There is meaness that I don’t remember from previous years and it scares me.
The infrastructure has rotted in California and no one wants to take the sacrifices needed to rebuild properly, everyone is out to get what they think they are owed, be it the middle class who think that they should have the public pay for their kids health insurance and daycare so they don’t have to give up one of the $500.00 car payments or the ones on welfare who are capable of working but choose not to.
I moved to the midwest after selling the house. The couple that bought it paid full asking price and used 100% financing, they are screwed. The identical model as their’s is now selling for almost $45,000.00 less than they paid 18 months ago.
Anyway best to wrap this up, I’ve already rambled on to long.
Hey Chuck, I’ve never posted on you site before but I have been reading your blog since the very early days when you firt started it. I was in my last year of school at Cal Poly SLO in 2004 and delivering pizzas on the side for some cash. I remember at the time everyone was talking RE. It was all over the news, the papers, my boss at the pizza shop was talking about it. It was just everywhere. I started thinking about it and I started to form an opinion that it wasn’t sustainable the way it was going and would eventually crash. I also started doing some research by reading up on previous busts and how they played out and also tried to see if there were some other people online who shared the same opinion. I came across a blog that fit just the bill. It seemed to say everything I was thinking. Unfortunately I lost the link soon after I found it. I don’t know who’s it was but when I came across yours in mid 2005 I though it was the same one (it was on blogger also). Until I started reading your blog though I did not have an idea of how or why the bubble formed. I just knew it was there. What you said made perfect sense and has helped me in understanding the mechanics of this thing.
Anyways, I too tried to talk people out of being swept up by the mania, namely the pizza store manager who faked his w-2 to show an income of over 90K so he could buy a house himself. Then when I graduated and got my first real job people were telling me I need to buy a house quick or I’d never get one. When I told them I would just wait for prices to come down in a few years they looked at me like I was crazy/stupid and gave me the same crap they were fed; “RE prices never go down.” And here we are 2+ years later and the same people I tried to warn back then are still giving me crap. This time however, they don’t want to admit I was right when everyone else was against me.
Anyway, I think what I wanted to say is; thank you for being there as one of the few voices of reason.
Hi Chuck,
Although, I’ve never posted a comment in any of the housing bust blogs I read over the past few years, I can’t but agree with you on what you just said. For someone who was born and raised in So Cal, who had her first job after graduating from UCLA in So Cal, and who had tried very hard to find a house she could “afford” during the last five years, I must say, I’m ready to move out of So Cal. My desire to own my home without falling into the common “traps” laid out by our realtors and lenders has benefited me greatly over the years while seeing my friends stuggle to buy and keep their homes.
Kudos to you and your family for saying the most “sane” thing about what is really important in life- not to be ruled by the American dream of owning our homes, but to live to accomplish what you can in our American dream.
Thank you!
I’ve lived in many countries and until recently I’ve always felt that California was an especially wonderful place. The best part for me was seeing the ethnic diversity, how so many immigrants were given opportunity. For the most part Californians are just regular folks doing what anyone would do. Who can blame anyone for getting caught up in the hype and trying to take advantage of the explosive RE appreciation since 2002? I’m not a property owner and I’m not laughing now, but am disillusioned and disgusted by those who knew better (our government), those who should have tried to protect the masses from being duped by the predetory fast buck artists. They are the ones responsible for poisoning California and US society with greed in the first place, and for the grievious fallout and human suffering that will ensue for many years to come. What we apparently have is worse than Soviet era communisim, it’s evil. From reading all the blogs and economic commentary I’d now say that, as one writer here suggested, yeah, things will very possibly unwind in the States something on the order of the USSR meltdown, it’s going to get bad, and the world will gloat only to kick us when we’re down. What’s even worse is that it appears that China is the only country positioned to fill the vaccuum of US demise…I live in China now so I can say–it’s scary! Pray for the world!
I chuckle at Layne’s rose colored glasses view of ‘regular folks’– regular folks in much of the rest of country are NOT stupid enough to sign for mortgages way beyond their means, or get caught up in what was obviously a bubble. Most of the folks I know take responsibility for their actions, and don’t whine about how the government ‘made’ them do these irresponsible things — there was no complaining when prices were going up!
So Layne, if your only thought is that the government is too blame, well, then perhaps you’re better suited staying in China…
I enjoyed your reflections and others’ replies. I came to bubble blogging a little later: after reading actively in 2006 I began a Santa Monica inventory log inspired by OC Renter’s county-wide inventory, then leaped into my own blog last spring.
Formative to me (a couple decades older than you) was living through the 1990-96 25%-or-so slump, which gives me some outlines of what’s ahead.
I know how you feel about the bubble:
http://www.irvinehousingblog.c.....denfreude/
Like you, I saw this bubble early — I never did forget how to do math. Math and logic lose out to mania. The frustration of seeing the obvious and being unable to convince anyone was too much to bear at times (pun intended.) I guess that pent up energy still keeps me going at times. I have been feeling a wonderful satisfaction from vindication lately. I imagine you are feeling the same.
I can’t even write a post like yours. I have been told a major developer is trying to reveal my identity in an effort to silence my work. It won’t work, but I also don’t want my identity to get out because I worry some disgruntled homeowner might go postal.
I have always enjoyed your site, and I stop by often to see if you have a new post. Keep up the good work.
IrvineRenter
Dear Chuck, I came to this blog through the link from “The Housing Bubble Blog”. I enjoy all the related blogs. Great work on this one.
I started reading these blogs, to find hope in possibility buying back in the California market. I had sellers remorse, as we sold our house in late 2005 and were going to move to the Midwest. Change of plans, thus we stayed in So Cal.
This market correction or “Crash” is real in the SFV area. Houses that last year were on the market for 1.1 - 1.0 Mil are now in the 9’s and high 8’s, likewise pushing some properties down 1-200k. Some well maintained properties are selling at a discount. We are still on the sidelines and renting. It will be interesting to see if 15-20% drop will be maintianed or increase in the next year.
I’ve known Mr. Ponzi from back when we where getting our MBAs together and he was selling his house. Kept talking about how we’ll be saying, “I told you so.” in a few years.
Smart guy this one!
Keep up the good work Budy… Oh, I’m going back east again, for Love, not money.
Keep up the great work Chuck! I too am a former midwesterner in his 30s now living in Los Angeles. My wife and I got caught by the bubble boom and have been patiently waiting to buy our dream house.
I figure you, Dr. Housing Bubble, and Patrick.net have saved me about $150,000 so far. I owe you all a beer. Thanks!!
Hi Chuck,
This is your old friend Edgard and I felt I should comment or update on the state of my Real Estate clients, which I am happy to report they are doing well, except for a couple of them who decided to stray away from the plans we outlined for them. We (our clients and us) expect the next uptrend to beging in 2010, for which we all are properly secured with the right loan programs.
Should the market tumble down an additional 30% or thereabouts most of us would have still benefited from our real estate holdings.
As we always say “Have a Plan”
Best Regards and thank you for sharing your name.
Edgard J. Quiroz
Wow you must be a genius. That’s like saying - “I feel it coming, its going to rain!” Well, yes if you say it long enough you will eventually be right. In truth you thought home prices were overvalued late 2002 early 2003. In 2004 you say honey housing is overvalued lets sell (this sounds more like an investor). You sell it for twice as much as you paid for it a few years earlier. So lets say you sold it for 450,000 (meaning you paid 225,000). You move out and most likely had to pay rent right? $1000/mo - Approx. the same as what the mortgage on a $225,000 house was at that time. Hmmm….Seems to me that that house is now worth about $500,000 - down from the $600,000 at its peak but still that’s a lot of equity on your $225,000 house! Me thinks you made the wrong move. Granted, this story would be different if you thought it was over valued when it was at 575,000 and sold at that time. Then you’d be my hero - of course I would argue that maybe you just got lucky. - You are entertaining reading though
I have lurked all the housing blogs for 2 years because I was amazed at how the prices were growing exponentially. The logic of math is a lost art in this country….exponential is unsustainable,eventually. Wife wanted to sell and move up, I asked why when all the equity we get on our house will be eaten up by overpriced housing. We bought a house that was a firesale in 1998(in our first choice neighborhood!) and approximately 25% below market value. I have felt pretty smug in my current situation, but now I fear a protracted contraction of the US economy could even nip savers/misers like me in the butt.
On a side note, due to my wifes physical ailments we may eventually have to move out west to a dryer climate. She loves San Diego. I told her we should wait till at least 2009 to even consider buying there. I personally am not enamored with California, I like the North East US and the winters, change of seasons and being within 3 hours of New York city, Washington D.C. and such.
Could people who live or have lived in San Diego give me the lowdown on the good areas to live and what it is really like in San Diego. I would be very grateful.
Thanks in advance
Hi, My husband saw what was happening in mid 2005 Just the price increases alone were a sign something was not right . We could not understand how people were paying the high prices as they kept rising ( WE SURE DO NOW).So we sold our home and were now renters.. As our old home is now up for sale for much less in price renting was a good move for us.We tried to tell others like family and friends but we were lone voices crying in the wind. Will we buy again maybe .Were now getting ready to retire this year so we will be looking into other states.
What is the matter with you folks out in CA? Is it the sun? The dry air? What makes you do stupid things - like uprooting your family just so you could, maybe, try to time the ‘real estate market’ just right.
Has anyone else seen Mr. Mortgage’s videos on YouTube?
Here is a link to his newest foreclosure analysis (April Foreclosure Report) from ForeclosureRadar.com.
http://www.youtube.com/watch?v=LCW4A0ACDKM
Here is a link to all of his video analysis of the mortgage market.
http://www.youtube.com/profile.....ti&p=r
This guy is awesome, a must see!
Let us know what you think after watching these…