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Palo Alto Outdoes Itself
As many of you know, the real estate market in Palo Alto has been going bananas for years, particularly recently. I've written about this phenomenon here, here, here, and - my favorite - here.
I've lived in Palo Alto since 1991, and at the time, it was a terrible stretch for the very-young Tim to buy a house in town. In retrospect, it was one of the greatest (and few) "long' positions of my life, since it's worth about twelve times what I paid for it back then.
I sure wish I could buy a put option on it, though, because we've got to be at some kind of zany top, given the front page headline on this morning's Daily Post. Here ya go:
So, as you can see, the (very well-compensated) new CFO at Google purchased a house in town for $30 million, a record for the city. (It's also good news for the school district, since Ms. Porat will be shelling out about $350,000 in property tax per year in perpetuity).
Before you think to yourself what a grand palace it must be, and on such a stunningly huge plot of acreage, let me disabuse you of this notion: this house is 4,700 square feet, and it is on a plot of land smaller than a single acre. There are two really nice neighborhoods in town: Crescent Park (which is where I live, thank you very much) and Old Palo Alto, which is where the above house is located. She's a block away from the ghost of Steve Jobs. It's a lovely neighbhorhood, to be sure. But...........thirty million dollars???
One interesting tidbit I learned about the house is that it's been unoccupied for..........twenty 
years. Its owner, the billionaire John Arrillaga, bought the house in 1972 for a million bucks, and although he lived there a while, after he moved out, he just let it sit vacant. (I guess when you're a billionaire, foregoing rent doesn't really matter). He says he was waiting to sell it to someone "with a family", and although I suspect over the past twenty years a few non-single people have moved into town, for some reason he chose Ms. Porat as the perfect buyer.
Speaking of Porat, here's a tidbit about her, too: according to her Wikipedia page, "During the financial crisis, Porat led the Morgan Stanley team advising the United States Department of the Treasury regarding Fannie Mae and Freddie Mac, and the New York Federal Reserve Bank with respect to AIG." A dubious achievement, if you ask me, but given the fact that she is paid a salary that in the span of five months equals the above house price, whatever she's doing, she's doing right. All the same, this is insane.
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Does it come with a zoning permit to replace the house with something maybe ten times larger? Or subdivide into four or more lots?
The land is probably worth, oh, what, say $8m?
Well, with new pipes, electric, asbestos abatement, fumigation, foundation bolting, roof, paint, and landscaping, it should be livable for a few years before teardown.
I wonder if some of these seemingly ridiculous prices are because these folks are a bit unsure about how 'real' all their apparent wealth is...Better to buy something you want now, even at inflated prices. It'll still be there even if a whole crapload of your money isn't anymore.
What else are they gonna do with it? Invest it, buy stocks? That's starting to look pretty ugly...
as the debt bubble blows, these people will ultimately be targeted in an unbelievable way by the tax man. Let them have their house. California Taxman is coming.
Very good point.
She looks like an Israeli politician. Young and hip with the fashion sense of a 90s lesbian.
Lady look like a dude.
Women in Tech. Can't live with them, because the vast majority of them are useless at problem solving. Can't live without them because otherwise the Marxist left and the Jews will boycott. Sure, many of them can perform well in routine semi-technical office type jobs like accounting, but that is far from the majority whose strongest skill is bla-bla-bla. Bla-bla-bla and looks will get you pretty far, but in Tech in the end it is the quality and quantity of the work that you produce.
So most women in Tech end up in Finance and HR and when their looks and sexual desirablility peter out at about 35, all they really have left is their ability to bla-bla and to lie. Just think of all the men who get screwed in child custody battles because the women bla-lie-bla-lie to each other. And what about centuries of cuckolders?
Consequently we end up with these bitches like Carly Fiorina who destroyed Hewlett Packard, or Melissa Meyer, or even this newest cunt on the block, now at google due to her crony capitalist "skills" she honed at MS.
The real truth is that all these women climbing the career ladder would get nowhere without the FED and the welfare state, since they can't compete with the male engineers who are really the ones who keep the system going. They depend on Zirp, QE and inflation to grease their skids.
I have hired hundreds of "techies"...and out of due respect I will make one exception to your statement. South African ladies of dutch decent between 30 and 50 can be quite brilliant. Their education system used to be one of the best in the world, and their work ethic is great. Throw in great problem solving skills and aa good sense of humor and....it saddens me that one more of the strong cultures of the world has been flushed down the toilet.
I would only like to make one minor addition...
>So most women in Tech end up in Finance and HR
don't forget Sales...
Good comment. Very good. But I could have saved you....let me rephrase for you. She would never have gotten the job if she wasn't a she and apparently somehow wired into the Treasury. She is a dream boat for GOOG....a woman who can continue to keep GOOGs EU tax dodge functioning. Aparently Coke CFO badly soiled his undies last week when their tax scheme went blatto. BTW this is probably a good way to ride into town guns blasting and announce, "Boys I got game"
I'll bet she's freaky in bed.
zionist jew, is her major qualification. everything else is just cream cheese on the bagel
Many years ago all of the R&D engineers were male and we were on a higher pay scale than the other departments. Because of some fear of discrimination lawsuite they decided that anyone with a college degree should get paid the same. Forget that the typical male engineer contributed millions and millions of dollars to the bottom line the compensation became the same for all departments and the stock options stopped. Fuck em, now the girls in China love me long time.
Um...
Your post qualifies for a '10M', if such an upvote prize existed... Beautifully put my dear sir -- and bitingly True...
ConfedH's comment is likely the best damn comment I've read in a while - certainly no bla-bla there.
When was the last time you saw a good, honest, woman design a circuit board (have seen some excellent female board-level designers btw, but their knowledge ends there), write firmware & programmable logic, FW updaters, bring-up utilities, mfg utilities, application software, the whole shindig... wait, only a few of us males worth two shits in SV can do the whole damn thing well at both the prototype and production levels anymore, and we get paid pennies in comparison to the silly money floating around.
Heaven forbid suggesting a woman to play a woman's role in this world today lol - the feminazis will clown you like Sideshow Bob.
On one front you have the bigSploogle / bigFakebook / etc. crowd rolling in silly money. On the other front you have the endless stream of website (less) and app (more) "startups" rolling in even sillier money on VC dime.
The whole damn thing is a farce, with real value additions by real male "engineers" (not the app-making kind) [who have to bust their ass to get details absolutely right] totally unrewarded, and the family unit stretched into nonexistence with both pa and ma working while little Johnny goes to before and after skool daycare.
It's a strange world out there.
p.s. Consuelo, saw your comment yesterday - didn't know you were a Sunnyvale local. Crazy shit going on these days.
Hard for a single individual to do all that...(rare in that those skills take a lifetime to develop)
>and we get paid pennies in comparison to the silly money floating around.
All too true. My wages/salary have been all over the map since I got laid off from SUN Microsystems back in 2008. Have yet to come close to the salary I made with them, but on occasion SUN did act like a meritocracy in terms of monetary compensation.
As for this google bimbo, anyone stupid enough to drop that kind of money on a property shouldn't be allowed anywhere near a company's finances.
Let me tell you brother, when I say I have "shipped a product," I do not say it lightly. From architecture, board design, all levels of SW design, mechanical and enclosure design, cabling and assembly, production and testing, and actually packaging up the damn product and shipping it to the customer... been there, done that, and I'm a young'un to boot. Once you've gone on enough rodeos like that, you can say you are worth a shit or two. My small biz bosses did the same outta skool in the late 80s - that's how badass engineers come about to be in the first place, and I'm junior to their experience. Not many people get to do all that though - roles are specialized in the corporate chain, and ownership of product environment more limited.
Making an app is like a relative LOL activity in the breadth of systems engineers like us. The SF appboys can't even hold a shadow of a candle to the dedication to good engineering and personal knowledge/wisdom/growth that real engineers value.
Don't really give a fuck that false money permeates this strange place and honest work rewarded a pittance compared to the opportunistic. Happiness does not lie in these technologies or the illusion of false prosperity like the current real estate market.
When you give, expect nothing in return. If you do, the sanctity of the gift is broken. Similarly, technology is meant to improve, not enslave. The sanctity of technology is broken. I'll leave the field in due time. Can't go wrong with a food stall, as I've always wanted to do.
The other day at the skatepark (Santa Clara) I chatted with a gem of a man, and we were talking about how you should be a good person (trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean, and reverent minus the obedient lol) not for personal benefit, but because it's the right thing to do while you're here. Such crazy disparity in regular people wages vs. VIP wages. vs. RE prices vs. inflationary squash... man, the Bay Area seems like it's headed for a gnarly fall when the time comes.
My childhood memories of skating freely with everyone at the skate-heaven that was the old Cupertino library (right next to City Hall) are probably the best thing I'll take with me from this place when I leave for good to greener pastures.
Thanks for the compliment SB. I boarded in Pacific Heights with a friend several times in the early 70's, but I was never very good and managed to hurt myself a few times. Haven't gone near a skateboard in decades.
On your note concerning the sanctity of the gift I recently read about a distant Mormon uncle, a weaver and tailor, who lived in a small town in Utah. It said that he had been so generous throughout his life, always offering to help people with out demanding payment, that when he died practically everybody in town was in debt to him.
I have been dealing with some old German geezers for a few years now. It seems that all of them want to die with as much unpaid debts as they possible can. Aside from this being suck a glaring example of social capital, I was also struck by how our entire age is dominated by people who want to die with their greatest accomplishment being how many people they have cheated.
Part of the problem, is that there is no shortage of experienced MBA/CPA types in the world.
You could easily hire 100 well qualified CFOs for the money she is getting,
but it's Google, so what does sanity have to do with it?
The amount of silly imaginary money floating around here has made everyone loony mvthrfvckers.
Shared this yesterday on ZH, Tim, so some might have gotten the chance to see it. Don't know if you heard about this yet - we were talking about it with the family last night, thinking it's going to set a new precedent. Note the "it's gonna hurt our property values meme." South Bay is well on its way to being a soul-less shithole.
http://www.mercurynews.com/health/ci_28832426/sunnyvale-neighbors-sue-ba...
But Tim, she's moving from New Yawk.
Probably swapped a 2 bedroom condo even Steven.
Looks like a very nice house ..house age 83 years..must have a quaint and nostalgic atmosphere...I hope she is happy there...
And twenty years sitting empty. Some interesting critters and odors no doubt.
I've been really awful at calling tops and bottoms in just about everything - except real estate. And for what it's worth four weeks ago I called a top in Sydney and Vancouver housing. We'll see how that plays out. Palo Alto I suspect will be the same but I moved away 20 years ago and I don't keep tabs on it. If I owned there I'd sell up and pay the outrageous rent for a year and see what pans out. I'm renting a really beautiful condo in Malaysia right now with views out to Singapore. Probably the nicest place I've ever lived in and the rent is $430 per month. Sometimes EMs and corrupt prime ministers can really work in your favor. No idea where to next.
Don't get in a tizzy folks, these are the natural distortions of a collapsing socio-economic system. This while bad, is most certainly not the most egregious. I shudder to think what some of the most excessive insults are. Shrug it off and wait for the time of retribution.
;-D
"Shrug it off and wait for the time of retribution."
Garsh, I must be going dyslexic... For a brief moment there, I thought that was 'redistribution'. Hey wait a minute...
+5, you are absolutely correct. The lizards and their minions are going to have to give back some of their ill gotten gains. This is as it has always been...
;-D
so there was a lot of this going on in 1988-89 in Moscow and Kersh?
Both the population and technology curves are exponential. We are on the vertical part of both. The extent of the decay didn't really strike home until "they" began calling us, "consumers". THAT is when the monster stepped out of the closet.
;-D
"since it's worth about twelve times what I paid for it back then"
I would sell it today. Just a thought.
More than just a thought. That is the opposite of buy low, sell high. In other words sell high in order to buy in low and make a profit. There are TWO sides to a trend, everyone always forgets the other side of the coin.
California real estate is not a liquid asset because Proposition 13 resets the property taxes to the new purchase price. This is why he made the point that her tax bill would be $350,000 per year.
Until Gartman decides to make a purchase here, I'm holding out for more gains.
Ah Timmy. Your insecurity on every post shows. Constantly pointing out the value of your home. Critisizing Gartman on a daily basis. Why dont you write a post on how you have shorted this market and lost 30% of peoples money in your fund. Or begging people on your blog for a few dollar donation. That would be a interesting post.
Numbers like those make me dizzy and light-headed.
A mere 67 tons of silver
Never thought of it that way, but it does sorta put a different perspective on it... So I wonder how many pallets of 1000 oz. bars that would take up...?
The house itself doesn't weigh 67 tons.
I'd rather have the silver.
Sheeeeeeit. Niggah please.
Volume-wise, that is a LOT of silver.
Check this out:
Silver - Visualized in Bullion Bars
http://demonocracy.info/infographics/world/silver/silver.html
.
Cool website link!
Bookmarked.
Demonocracy is also linked on the upper left side of your ZH page. There are some other solid links there, too.
Hey DW, that was a pretty awesome visualization, Thanks!!!
;-D