Professor Elam

John Stossel is one of my favorite common sense columnists.  Here he takes on the stimulus and identifies the economist who made the ‘bucket of water from the deep to shallow end’ of the pool observation.

This past weekend my wife and I observed a $899,000 new house for sale in Duncanville.  There were about five others like it as well as several vacant lots in the same small two block area. That makes a dozen or so potential $750 K + properties or would be properties. It took an annual income of $233,000 for a cou0ple to qualify for a loan.  We wondered if there are a dozen couples with $250K annual income wandering around hankering for such a house.  I would guess the utility bills for a 4900 sf home, especially with all the 15 foot high windows this one had would be well above $1,000 per month. This seems as foolish as a 5,000 pound 15 mpg pickup at this point.  My point is that the builder speculator has debt at the bank just on these properties of over $5 M and the interest meter is running.  It is hard to see how $600 spent at WMT is going to help these guys or their banker.