Never dip into your own stash.

Real Estate Agent with HomeSmart International

Most of us are old enough to remember the grotesque impact, that the classic "Scarface", starring Al Paccino, made on some of us when it first came out.

Aside from the graphic violence and an intimate peek into a drug dealer's world, the one thing I remember, was Paccino's advise to his own cronies NOT to "ever dip into your own stash".

I know, .... you are wondering where the heck am I going with all this.....what in the world do drugs have to do with banking and real estate?

Let's rewind our thoughts for a moment..... have you noticed lately, that a huge number of your real estate colleagues are not only shying away from "short sales", but they are actively asking the MLS to have a sure fire system, (like a little box that you check or un-check) to denote a listing as a "short sale"....or at the very least, not to obfuscate the fact that the listing IS or IS NOT a short sale? many listings are beginning to show in the "agent's remarks": "THIS IS NOT A SHORT SALE!!!"?

....have you had any buyers looking at property who have specifically asked you, "NOT to show them any properties that may be "short sales"? ..........enough already, you are thinking .....what's the point?

The point is that we are experiencing the symptoms of a system gone bad....the effects of  realtors and buyers turning their backs on banks and saying: "you are on your own"....."we will visit with you when you  own these properties, and your motivation to sell is a lot higher".

Like a virus, the banking mentality is infecting everything it touches, and is beginning to destroy the very core of the way we do business.  Banks are in essence doing themselves in....but their arrogance keeps them in denial.

The contagion is widespread is quick, and it is deadly! is already too late to contain it has already infected the entire global economy. 

At this point, nobody has yet found an antidote that matter how much money, no matter how massive the dose (2...3....4 trillion tax-payers' dollars?) we throw at it, it continues to grow and spread unrelentless, destroying everything in its path..............we are now entering "survival mode".

Don't expect Alan Stanford to be the last "banker" who we find out has defrauded investor out of BILLIONS of dollars, ....don't expect the Swiss Banks to be the last ones to be forced to open the lid to the secrecy of the financial kingdom .....there will be more.

Our senses are numbed by the surrealism of it all a bad dream or a sci-fi movie we can no longer tell the difference between fiction and reality....we watch, stupefied and paralyzed as the catastrophe unfolds.

Somewhere, somehow, we hope that some mysterious, dragon-slaying and chivalrous knight in a white horse, will show up out of the blue, and with a swift pass of his sword, slice the beast's head off.

Let's all snap out of this victim mentality ..... let's all take back the power we have given to the banks ..... right now, at this very moment, they need us more than we need them!! ...the banks do not understand real estate.....they would be fools to try to do it by would be just one more nail on their coffin.

Don't let anybody talk you into the idea that somehow the banks are going to take the business of real estate away from us ...... don't let anybody scare you into the misconception that these "almighty" banks are "too large of a foe" for us to face....they have drunk their own cool-aid.

Banks do not operate in a vaccum.  The entire world is collapsing around them and they continue to implode, as they cling to the arrogance of a fool.

We have seen the hair-line crack on their shells....we have spotted the chink on their armors...why, just this week, in a defiant stance, my office stood up the the monster and told them that there would be no negotiation on our commission.

......and they caved.....they actually agreed to our terms, as the prospect of yet another property on their books was beginning to look quite un-appetizing.

So don't bank (pun?) on the government to bail us out.......each one of us must step up to the plate....each one of us must take the risk of doing the is up to us, individually and collectively, to change the paradign and stop, contain and eliminate the virus.

The most important actions are never comfortable.....the pain of the consequences of doing nothing is a lot greater than the loss of a potential commission, or watching in horror as the world falls apart around us.

WE are the white corpuscles fighting the infection, in the battleground of the financial on one.....mano a mano.

It is not by throwing money at the banks that we will solve this financial crisis....that would be akin to trying to put out a fire by dousing it with gasoline.....the bail-out money only feeds the disease and weakens our resolve.

So again, why am I bringing up Scarface's advise "Never to dip into your own stash"?  I'm doing it because the banks have violated the first and most important rule in the drug dealer's code; ... they dipped into their own stash!

Surrounded by trillions of dollars of their investors money, the banks were unable to resist the temptation of tasting a bit of all that wealth .....ahh....the mansions, the travel, the private jets, the glamor, the was just too overpowering for them to resist.

I can see their plight, their prayers.....Oh Lord, lead us not into temptation, we can find it by ourselves!....but once they had drunk from the crucible of evil, there was no going back....their bonuses grew outrageously large, their risks climbed to new heights, they grew careless, their common sense went out the window, their integrity was a thing of fairy tales.....they got high on their own stash.

In time, consumed by the criminal mind, they were unable to tell the difference between good and evil, between right or wrong, ......they became entrenched in the arrogance of the short term rewards, and justified in their own minds, they never felt that they were doing anything wrong.

They had opened the Ark of the Covenant, they had eaten the forbidden fruit ...... unbeknown to them, they had unleashed forces that were too powerful for them to understand or their greed and ignorance, they had managed to anger the financial GODS!

And now, we seek repair for this mess by propping-up and reviving the very culprits and institutions that are guilty of creating it in the first place.....a system that is already dead from the inside out.

In order to satisfy the God's ire, we must offer valuable sacrifes.......banks and bankers must become the sacrificial lambs, and be replaced with a sound and sustainable financial model.

There has been too much concrete under these bankers' feet, and they have lost the connection to Nature's true teachings....they have forgotten that Nature runs its most successful systems in a wise, sustainable and elegant's time that we emulate mother nature if we hope to make it through this insanity, unscathed.

If we are to solve this challenge effectively, we would align ourselves with the forces of nature and implement its wisdom.

Imagine for a minute, that the banking system is a tree that is out of balance (dis-eased).  The tree has used used most of its nutrients and resources to give its canopy (CEOs and upper management) a sense of well being and exuberance

At first, the tree looks healthy, with big shiny and succulent leaves at the top, but the roots are weak and the tree is beginning to show signs of illness (the taxpayer and consumers loosing jobs and lowering their standard of living).

A self appointed caretaker of the tree (the government), noticing that the tree's upper leaves are begining to yellow and wither, gets concerned and decides that it needs to do something about it.

There is water (money) in a large storage tank (the Treasury Dept.) that has been filled a bucket at a time (taxpayers) to use for the entire garden, including other plants and vegetables (health, education, infrastructure, other projects), symbiotically intertwined with the big tree.

Ignorant of the ways of nature, and lacking common sense, the caretaker decides that the best course of action, is to take massive amounts of water (money) and totally drench the upper canopy (the banks), in the hope, that this will soon resolve the issue, and those upper leaves will quickly regain their vitality.

Of course, he assumes, that water from the top will trickle down (trickle-down economics) and eventually reach the roots (the consumer).  To his dismay, water is wasted on just wetting the leaves and most of it ends up  evaporating and serving no useful purpose (CEOs outrageous salaries and bonuses).

As the canopy's leaves continue to yellow and fall (investment banks going BK and dying), the caretaker (the government) decides to try a slightly different course of action.

He (the government) decides to get more water from the pond (print money), and get the neighbors (China, India, the Middle East, etc.) to lend him some water (money), with the promise of returning it to them at some point in the future (future tax debt for our children and grandchildren).

The plan is, that if he uses this borrowed water (money) to water other plants and vegetables nearby  (infrastructure, shovel ready projects, health care, etc.), that some of this water will eventually permeate sideways to the tree roots, and the tree will begin to regain it's health.

He is kind of on the right track, as he realizes that nutrients are absorbed thru the roots, and that the health of the tree, although in a slow and indirect way, may eventually be recovered.......this is where we are today.

This approach carries however, the risk, that it may be too little water too late, and that the tree may  be too far gone to save.

A savvy gardener, aware of the peril of the situation, and understanding the natural ways, would quickly proceed to stop watering the canopy leaves (stop bailing out the banks), let the dying leaves drop (allow banks in trouble to fold), and even go to the more crucial step of pruning back the tree (establishing regulation), and riding it of the extra branches (firing CEOs and closing down all banks that do not meet sound financial standards).

Next, he would concentrate the available water and nutrients (money) directly onto the roots (the consumer), knowing full well, that as the roots begin to use that water and get healthy, that they will shoot up its goodness into the trunk (financial system) and the branches (banks), and that eventually a healthy tree with a full and fresh canopy (economy) would return.

So what does this last paragraph translate into?

Simply put, it means that instead of providing welfare for the rich corporations, like we are currently doing, we make those same resources available directly to the roots (the people).

There are 200,000,000 (million) people in this country. The average family has 4 people, so there are 50,000,000 (million) families.

This bail-out is expected to cost 3 to 4 trillion dollars.  If we use the conservative figure of $3,000,000,000,000 (trillion) and divvy-it up amongst the 50,000,000 (million) families, then it means, that each and every family in the US would get a government check for $60,000.

Of course, not everybody is married with a family, so single individuals of legal age would each receive a check for $15,000 (60 divided by 4).

This money would have to be used primarily for: paying down mortgages, credit card debts, outstanding loans, or used to start a new business.

I guarantee you that this would definitley stimulate the economy.  All that money would be at the roots and in a matter of days (when people use to pay off these debts) it would be in the hands of the bankers, who now would have so much liquidity, that they can turn around and and start to lend it out again......

and thus.....the water and nutrients (money), would move quickly through the roots (people), and the trunk (financial system) and into the leaves (the banks), bearing fruit (new loans) and returning the health and vitality of the tree (the economy) once again. hard and complicated is that?



Comments (6)

C Tann-Starr
Tann Starr & Associates, Inc. - Palm Bay, FL

Featured @ Club Chaos

Feb 22, 2009 03:38 PM
Betina Foreman
WJK Realty - Austin, TX
Realtor, C.N.E., with WJK REALTY

Great post!


Feb 23, 2009 01:02 PM
Kate Bourland
Marketing with Kate - Redding, CA
Onlilne Marketing Mobile Marketing

We've been talking about this in the office quite a bit.  Bottom up economics.  The answer was so simple 2 years ago, many of us here on the rain saw it. 

Your suggestion is the answer that makes the most sense.  This way there is no crying foul or unfair or pointing fingers.

Ahhhh, but alas we get to pay for Bank of America buying banks in China!!

Feb 23, 2009 04:33 PM
ZipRealty - Volente, TX


That is a great post. Thanks for putting it into an easy to understand anology of tree, roots, trunk, canopy, and water. We all know that trees drop leaves when they get stressed to conserve their core. However, our Fed Govt. is going against the natural order of things as they artificially keep them alive through huge infusion of cash (akin to spraying glue to keep the leaves then painting them with green paint.)

Feb 24, 2009 12:45 AM
Federico Astiz
HomeSmart International - Tucson, AZ

thank y'all for your comments and support ..... I was just thinking that while tax credits or tax cuts are great,  it does not touch the millions of americans who are unemployed and strugling to keep their homes and their families together.....unfortunately, we continue to treat the effects and not the cause.

Feb 24, 2009 02:00 AM
Scott Leaf Personal Real Estate Corporation
Keller Williams Elite Realty, Port Coquitlam, BC - Port Coquitlam, BC
Scott Leaf & Associates Real Estate Team

What a powerfull well thought out post

Feb 24, 2009 06:19 AM