The Real Worth of Real Estate vs. Triage By Arbitrage
The Housing bubble has burst because we don't value structures by their true
worth. The speculator pirates have created a triage by arbitrage scenario
determining the standard of living for humanity.
The false value of securities, the run up of derivatives, the commodities
exchanges are what is causing the speculation bubbles in all phases of life
support.
Lets figure the structure factor as an example of how we can stabilize the
value of personal property using US housing as an example. As a builder i can
get a house or any structure built on a sq. ft. basis which relates directly to
TIME invested in the project. If we convert TIME to what the planet invests in
the human that worked on the structure we have a world standard of costing a
house. We begin with 2000 calories one human one day . The nutritional calorie
includes the planet's infrastructure to support a human for a day. That foot
print will diminish as we consolidate the infrastructure from fifty acres to one
acre per family of five _ increasing the carying capacity of the planet for the
sake of our progeny.
That aside for the moment _ we need to show a value of
possessions in calories _ the currency of the sovreign citizen. US dollar is
worth four cents compared to 1912. The latest devaluation of the worth of fiat
currencies based on overvalued housing and securities is making investments
worthless and housing is being tricked into foreclosure due to owing more that
it is worth _ margin calls for property as the neighborhood values decrease.
This strategy by the money changers, was done for the tractor loans to farmers
_ they undermined the value of the crops by tweaking the commodities markets
and made the land collateral for the tractor loans worth less _ based on the
finagled lower prices for the crops and foreclosed on millions of small farms.
This was as big as the land swindled from the indigenous and the derivative
swindle based on hedging the interest rates of the mid eighties along with the
S&L interest manipulations to raise the interest rates on savings bonds to
stash the oil windfall booty.
The real cost of anything is what the planet had to invest in it to sustain the
humans involved. This because it takes from the carrying capacity of the planet
of the living in relation to what is left for progeny. What did that house cost
the planet and progeny? http://raenergy.igc.org/usury.html#derivatives
Using late eighties recollections for the breakdown of labor to construct a balloon frame house in Massachusetts.
We and most other builders at the time were building for $50-$60 a sq ft for the house only.
The site work was another phase of the project, which averaged out at twenty thousand a lot depending on size and landscaping
The land and financing were another project within a project where the speculation takes place.
The old contracting formula was one-third for labor, one-third for materials, one- third for the contractor’s efforts and financing etc.
The materials have a similar breakdown before profit and can be estimated with the same reasoning. Some builders in other places were realizing better or worse costs but the percentages remain the same. But we figure this is real for this area at that time and can be used for a valid comparison _ the proportions are nearly the same for balloon framing in the US _ the majority of the foreclosed housing in the US will be in this mid seventies to now category.
In the house building phase we were just materials and labor no profit to the builder _ what the house is worth without the hype. The subs had their arrangement usually one third for the owner sub and two thirds for the help. Using a framing contractor’s version of three dollars a sq ft for the interior exterior framing, sheathing, roof, siding, windows and exterior doors. Two dollars went to the help. In a one thousand square foot house it amounted to two thousand dollars divided by fifteen dollars an hour average at that time. This translates to four days for a crew of four or 89 calories for the framing.
Our goal here is to get the TIME spent or what the planet has invested of our progeny’s future assets in the constriction of a home.
If we extrapolate these proportions for the entire building project using two thirds of the labor costs for the help, at $60 a sq ft labor and materials allowing for fudge we have forty thousand dollars, by the sq. ft labor, broken down again by the subs, by the hour labor for materials minus the acquisition and profit of the raw materials for both to isolate labor only. $26,666 divided by fifteen dollars an hour is 1777 hours for a one thousand sq ft house or 222 man days.
2/3 of $60,000(cost by sq ft to builder) = $40,000(actual money to subs) x 2/3 = $26,666(labor minus sub profit and tools) / by $15 an hour = 1777 hours / by 8 hour shifts = 222 man days x 667 (one third of a day’s calories) = 148,074 calories / 1000 sq ft = 148 calories a sq ft for bricks and mortar for a stick built house regardless of what it costs now _ the percentages are the same to revalue property globally.
The value of the building lot, in labor, can be factored almost the same way. It was around $20,000 a lot for the roads, sewers, drainage, cable, electric, telephone, gas, paving to the utilities hook up to each unit. Using the same formula we can extrapolate by just adding another one third to the structure bricks and mortar value of real estate. Or 2/3 of $80,000(builders cost for a hundred thousand sq.ft. house and lot labor minus profits) etc. or a 197 calories a sq ft. cost to our progeny for a unit of real estate for first world balloon frame housing on a typical building lot in a city. We can use these man hour figures for housing from the seventies to now built with dimension materials, accepted building codes with power tools.
By extrapolating the TIME the planet has invested in a project can be reasoned by what advantages our progeny inherits by the use of those resources and the nutritional calories invested in their fabrication.
Now we handicap by region country etc. to bring in the Reverse Role Reflex Fairness factors. In the first world we use approximately four to five gallons of diesel and day energy and upwards of ten acres of land per person to realize the two thousand nutritional calories a day for human sustenance in the US a little less in Europe. This has to be factored by region to compute the proginal deficit _ what the global progeny and planet has already contributed to the sustenance of humanity in that region.
We will eventually achieve a universal footprint _ Living Simply So Everybody Can Simply Live
We can sophisticate these formulas for a virtual regional rational over a number of years based on food miles, meat diet, imported resources etc. materials, building codes etc. that will vary.
These handicaps are a constant that can be used in the revaluing of personal possessions on a global level with equality never before sought. Footprint consolation is a peace dividend we can give humanity to enable their psyche to accept the fact that they have the ability to empower their progeny, with fairness from all sides in mind _ the reason for converting to the nutritional calorie in the fist place _ so humanity can envision another way and vote for the covenant between themselves they have been singing about for fifty years of so.
One might think this handicapping is a punishment but we are in that kind of a situation with the devaluing of the currencies, the theft of pensions, the reneging on social contracts and the devaluing of real estate and securities. This is a retroactive pay cut for the average first world tread- miller no mater how you rationalize it. The two thirds undeveloped world can get some of the looted resources back in their camp by retroactive default or put another way the retroactive pay cuts the first world are realizing can be applied to the citizens whose backs the first world was built on _ equity restorative justice without the global truth and reconciliation world tribunals.
One might view this as the redistribution of TIME on steroids.
One might ask how do we compensate the help for building a house or manufacturing etc. in the future.
There will be interim exceptions until humanity votes for the covenant premise enabling the new system to take hold.
WE determine the value of things so we can trade equal TIME _ the currency of the sovereign citizen.
But when things get organized: First we don’t build for profit, we barn raise for each other in a village setting _ the Amish have the formula that we will inherit in the coming world depression. The two thirds less developed world has already made the conversions without the equality incentives. The climate changes the currency collapses, the Nihilism is the inconvenient truth or the necessities that will be the mother of invention.
Empowerment of progeny is a virgin experience for most except for the indigenous.
When we vote collectively for empowerment of our progeny in a covenent we are like the lion when protecting our unborn or newborn _ we are preparing the crib and baby room of humanity _ a consciousness up-tick to say the least _ from selfish-ness to self-less-ness.