The Restless Project

Restless LogoWe need drugs to sleep at night.  Nearly half of us don’t have enough in a bank account to cover next month’s expenses, let alone any real head start towards retirement. We buy homes with mortgage payments our parents couldn’t fathom, or we make student loan payments almost that large. We are digitally tethered to work by gadgets that constantly let us down with bad directions or dead batteries. We almost never take vacations, but when we do, we read email every day anyway. We chug Starbucks and Red Bull to try to keep up, but we feel like we are letting everyone down all the time anyway.

America, land of the Restless.

But why?

I have a simple question I ask when I try persuade people that there’s something very wrong with the way we live in America today.

“Can you think of any friends with children who are secure they will be able to pay for their kids’ college?”

There’s always an uncomfortable chuckle, as if I’d just asked if they knew someone who could weave straw into gold. Then there’s usually a discussion about how everyone feels like they are working harder, and perhaps even making more money than they’d ever dreamed, but yet falling behind anyway. So they run on the rat-wheel faster and faster.


Today I am announcing a new long-term effort, an on-going series, called The Restless Project.  I plan to unpack the root causes of this Restlessness. I believe they are paradoxically both more subtle and more obvious that most busy people realize. And I think it’s such an important discussion — I think it is the story of our time — that I am interrupting my career to shine a spotlight on it.  Along the way, together, I hope we can explore ways to jump off the Crazy Train.

Trina Foster-Draper. No one should have to undertake a Fourth Act.

Trina Foster-Draper. No one should have to undertake a Fourth Act.

I will talk about humble Americans like Trina Foster-Draper, a 56-year-old single mom of four who will be proudly writing her last check for her kids’ college this year.  She was recently laid off by CenturyLink in Logan, Utah, where she’d worked in customer service for nearly six years.  What will she do now? Go back to school for information technology and begin her fourth career transition.

“Everybody has to keep changing, keep reinventing themselves now,” she said to me, sitting in her apartment she shares with her father – a brand new building adjacent to a massive Walmart. “There’s no choice.”

Despite the occasional catcalls from folks who casually argue that today’s adults are just lazy and selfish, for the most part, there’s general agreement on the problem — the creeping sense that life is somehow spinning out of control.  It is.  Today, we all live under pressure from a diabolical combination of economic dis-ease and technology disruption that keep all of us, not just on our toes, but on the edge of a cliff.  Second Acts are fine, even romantic. Fourth Acts? That’s insanity.

The reasons for Restlessness that I will explore in this series are myriad:

1) It’s an economics story. Just 50 years ago, an American household with one decent job could afford a decent home.  That math is now horribly broken. Today, it takes two incomes, and even at that, a much higher percentage of household income to buy a home. That’s why you never feel like you have enough money.

2) It’s a work-life balance story.  Since you are insecure about having enough (what if one spouse loses a job?) you work too hard. Fear is an excellent, horrible motivator. People don’t take proper nights and weekends any longer, instead putting in hours over remote corporate networks, in large part because they feel like they have to. Forty hour work weeks took hundreds of years to evolve, which is an interesting history I will share soon. Smartphones took them away in five years.

3) It’s a technology story. Smartphones haven’t just wrecked our ability to disconnect from the office.  Pick your favorite restaurant: How many people are staring at phones while half-talking to each other?  Step back from the scene for a moment. We all look like rude idiots doing that, always more interested in people somewhere else than the ones we are with.  Sure, you could be better about phone etiquette. But billions of dollars have been spent figuring out how to make you addicted to these things. You didn’t stand much of a chance.

4) It’s a broken social contract story.  America’s social contract, always part-myth and part reality, has broken down entirely, in a way that doesn’t make sense. Today, people with regular jobs in regular cities can’t afford regular homes there.  That should be impossible. After all, the price of most homes should settle roughly into what most people can pay for them.  But not when the value of those homes is propped up impossibly by a credit system built like a pyramid scheme.  The math, you see, is against you.

5) It’s a disappearing middle class story. A quick thought experiment: What is a solid middle class job that would let someone comfortably own a modest home? Teacher? Cab driver? Bike mechanic?  Today, workers are driven towards high-income, lottery ticket-like professions such as information technology. Of course, a decent home in an IT-friendly neighborhood near Silicon Valley costs $1.2 million. Better work hard and get that big bonus. Meanwhile, not everyone can write computer code or be a physical therapist. What are the rest of American workers supposed to do?  This isn’t a minimum wage story. This is an average wage story.  By every measure, the economic “recovery” after the Great Recession has done nearly nothing to help the middle class. Sure, unemployment is shrinking, but that’s a misleading stat. Here’s the truth: Low-wage jobs represent nearly half of all jobs created as part of the recovery.

6) It’s a marketing story. What do you do when you feel scared of the future?  Well, you drink Red Bull, for one, so you can work all night and impress the boss. And maybe work yourself to death. Or maybe you pay $250 for a new pair of shoes, just so you can put aside for a moment those hopeless feelings that you’ll never, ever, pay off that student loan. Or maybe you’ll hand over your finances to that lovely man in the white shirt who tells you he can help you pay for your kids’ college, even though all he’ll do is suck out a percentage of your money in fees every year. But he does make you feel better.  The cycle of Fear and Consumption, as we all learned in the movie Bowling for Columbine, is powerful.

7) It’s a where-to-live story.  NYC dwellers have always been restless, always with one eye looking out for an emerging neighborhood where it might be possible to afford a dreamy 3-bedroom apartment in relative safety.  All of America lives like this now.  As I travel the country, everyone with a second or third kid on the way is trying to make impossible math work – where are the wages higher and the housing costs lower? North Dakota? North Carolina? Florida’s west coast? Oregon? So-called “second tier” cities are gaining steam and migrants as the recession’s recovery drags on, but these moves bring on other problems – like proximity to meth houses.

8) It’s a hacker story. Sure, computer criminals who might empty your bank account in ways that you didn’t even know possible is enough to keep you up at night. But that’s barely the beginning of the story.  Behaviorists have hacked you and now desperately try to deliver just the right ad at just the right moment so you can’t resist buying your product.  Huge firms with names you’ve never heard of collect data on you by the hard-drive-full – Axciom admits having 3,000 data points on nearly every American.  Heck, folks are hacking your genetic code.  What are your right to all this incredibly important, personal information? Basically, you have none.

We’re restless, and I want to explain why.  I’m certainly not alone.  Brigid Schulte, a Washington Post reporter, recently explored the complex life of American woman in her excellent book “Overwhelmed: Work, Love and Play When No One Has the Time. You’ll recognize some of the concepts about the relationships between two income homes and housing costs from Elizabeth Warren’s classic, The Two-Income Trap.

Since I’ve spent 20 years writing about ripoffs and the dark side technology, I think I have a unique perspective on the problem of restlessness. For the past year, since I left my job at NBC, I’ve been chipping away at stories in this area. Here’s a few examples:


I plan on covering the hell out of this topic.  (There’s already 27 stories in my special “Restless Project” section, which you can find here.) And don’t worry, I promise to write about hopeful trends, too, such as the explosive growth in yoga, or the technology tools that really do make our lives easier, or what folks in other countries do to stay sane in our digital world, or the members of the “Resistance” who are fighting for worker rights or simply promising to turn off the cell phones for the weekend. I hope you’ll follow along, you’ll criticize me, and you’ll make suggestions to help bring this story the attention it needs. The best way to make sure you don’t miss a post is to sign up for my email newsletter by clicking over to this form, or just fill out the box on the upper-right hand corner of this page.

The journey is personal. As I look around at my own career, I see the insanity of journalists trying to do an honest job and raise families in world where everyone is judged – not just by Neilson ratings – but by Facebook likes and ReTweets.  That’s a popularity contest which no one can win.  And I see my friends, who are increasingly incapable of having fun without having their faces in a phone or a video game, and I fear the lonely future that seems stretched out before me. I love a good chat.  I hope you will, too.

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In Seattle, home prices have skyrocketed (Bob Sullivan photo).

Is renting a home the new American dream? A report by the Urban Institute projects that even after the housing crash and the Great Recession are a distant memory, homeownership rates in America will continue to decline.

The report estimates that between 2010 and 2030, the majority (59%) of the 22 million new households that will form will rent, while just 41% will buy their homes.

The homeownership rate has been falling since 2006, when the housing bubble began pricing out many would-be homeowners — and the recession furthered that trend. In 2006, the homeownership rate was 67.3%; it now sits at 63.6%, even lower than it was in 1990, according the U.S. Census’ most recent American Community Survey.

(This story first appeared on Read it there.)

But even the economic recovery won’t reverse that trend, according to the Urban Institute. It offers six reasons:

  1. Wages. Real wages have declined among adults ages 25 to 34 since 1996. “Even for young adults with good jobs, low vacancy rates and high rents make it more difficult to save,” the report says.
  2. Student loan debt. Total outstanding debt was about $300 billion in 2003; now it is over $1.3 trillion. Long-term debt makes additional long-term debt less appealing.
  3. Delayed household formation. Both women and men are waiting four years longer before marriage than in 1980. “Because of the delayed marriage and childbearing,homeownership is apt to occur later. At a result, people will spend less of their lives as homeowners, placing a drag on the homeownership rate,” according to the Urban Institute.
  4. Lingering effects of the recession. Roughly 7.5 million Americans lost their homes during the recession; most will have a hard time buying a new one, dragging down the homeownership rate.
  5. They’re not that into homebuying. More Americans are consciously choosing to rent over buy. One study looked at “prime candidates” — married couples earning at least $95,000 annually who have at least one child. “Even for this group, after controlling for race and ethnicity, the homeownership rate declined from 87.3% in 2000 to 80.6% in 2012,” the report says.
  6. Higher borrowing standards. The report says that lenders are still “historically tight,” particularly among borrowers with lower credit scores. (You can check your credit scores for free on to see where you stand.)

The report also considered changing demographics — a majority of new households formed in the U.S. during the next two decades will be non-white — and while those groups traditionally have lower homeownership rates, the Urban Institute found that will not contribute significantly to overall homeownership rates in the future. That story is a mixed bag, however.

“For at least the next 15 years, whether the economy grows slowly or quickly, the homeownership rate for African Americans will decrease while the rate for Hispanics will increase,” the report found. “More than 50 percent of the 9 million new owners between 2010 and 2030 will be Hispanic, nearly one-third will be other races or ethnicities, 11 percent will be African American, and only 7 percent will be white.”

The shift from owning to renting means that many more rental units should be built, the Urban Institute says.

“This change will create a surge in rental demand from now until 2030 that we are unprepared to meet,” it says.

It also suggests that mortgage lending standards be relaxed to nudge more would-be renters to buy their homes.

That conclusion doesn’t sit well with everyone, however.

Logan Mohtashami, a California-based loan officer, says the notion that lending standards are tight is a myth.

“There remain a number of highly respected housing ‘gurus’ who continue to profess that it is unfairly tight lending standards, not the lack of qualified buyers that are suppressing a housing recovery. The difference is not academic,” he says. “A quick review of the requirements for some of mortgage loans available may surprise you.”

VA loans require no down payment, for example, he notes. And buyers can get other mortgages with credit scores as low as 560, with 50% debt-to-income ratios, or down payments as low as 3%.

“At this point all you can do is bring back 0% down loans and stated income loans for wage earners,” said. “Look who is really pushing the tight lending thesis. People in New York, D.C., San Francisco. What I call economic bubble cities. Main Street America gets this thesis I am saying.”

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MyCreditUnion.Gov image. Click for more.

MyCreditUnion.Gov image. Click for more.

While many Americans are ill-prepared for a financial disaster, women are far worse off than men, according to a new study by BMO Harris Premier Services.  The financial services firm says that men with any emergency savings have an average of $58,061 put away to deal with the sitution, compared to only $33,558 for women.

In other words, women have roughly half the emergency savings of men.  Let that sink in for a moment.

The “rainy day” fund story is a broken record. Depending on how you count, something like one-third to one-half of all Americans have no savings, and are one missing paycheck away from piling up credit card bills and heading toward the financial abyss. But the gender gap in savings puts a new face on problem, and hopefully rings some new alarm bells.

I’ve written nearly 100 stories as part of The Restless Project so far, and read 1,000s of emails from readers. Perhaps the most poignant came from an older, single woman who took me to school about the real problems that keep people up at night.

“How do single people, people who do not have access to another paycheck, survive at all?  Half the country is divorced.  Millions are older and alone. Tons of people are childless on purpose because they couldn’t afford to have any,” she wrote to me. “If you don’t work for a major company, benefits depend upon the kindness of strangers.  It is an unpleasant poverty stricken future that I face.  I will NEVER be able to retire.  I will have to work until the day I die in order to survive…. just survive….   and women of age cannot get other high paying employment because of their age.  Double bind, no exit…. Just the ultimate one, and doing so on the job.”

Gender-based income and savings stories are fraught with statistical peril, which I’ll try to tiptoe through here.  But when looking through other available data I could find about women and savings, this seems undeniable: the financial position of many women in America is shamefully fragile.

First, back to the BMO Harris “rainy day fund” study.  The firm conducted an online survey of 3,000 Americans and asked how much money consumers had available in an emergency.  The amounts that consumers self-reported — which is always a hazard — could have included retirement accounts, though the way the question was asked, it’s possible some consumers didn’t include 401(k) balances, etc., when answering the question.  Also, the figure is an average, which means the amounts could be skewed by very large or very small entries.   So I went looking for other data to round out the picture.

Neighbor Works America released an emergency fund  survey on March 31, and it found that 34 percent of adults in America – more than 72 million people — said that they don’t have any emergency savings.  The figure had grown in the past year, despite the improving economy.  And 47 percent said they’d burn through their emergency savings fund in 90 days or less.

The report broke out data showing that low income and minority Americans were less likely to have savings, but was silent on gender.  Neighbor Works was kind enough to dig up gender data from its study for me, but it was inconclusive.  Women and men reported having any emergency fund at about the same rate, and women were only slightly more likely to say they have little confidence they could withstand a financial emergency (35 percent to 31 percent).

That doesn’t contradict the BMO Harris findings, however, because it makes no mention of dollar amounts.

And Neighbor Works’ Douglas Robinson offered a logical explanation for the dollar gap.

“While a great many women have been in the workforce since they became adults, their workforce participation rate still lags men, and is often interrupted,” he said. “That would mean that their matched 401(k) would be reduced.”

Other research suggests that’s true., in an excellent story on women’s readiness for retirement, hit this point on the head: “American women age 55 to 64 with retirement savings have accumulated an average of $81,300 compared with $118,400 for their male counterparts,” according to a Black Rock  survey. The story cites similar reserch on “retirement readiness” by the Employee Benefit Research Institute that claims single  women baby boomers have a savings shortfall of nearly $63,000, compared to single males, who have a deficit of $34,000.

What makes this savings gap more painful is that there is some data to suggest women are actually better savers than men. Fidelity looked at its 401(k) accounts last year and found that women in lower-income tiers put considerably more into their retirement funds than men.

“Women earning between $20,000 and $40,000, for example, have saved an average of $17,300 in their 401(k), as of the year ended Sept. 30, 2014. Men in that income range have an average of $15,200 in their account,” reports Bloomberg, in its story about the study. 

Critically, retirement savings and emergency savings are not the same thing, though they can end up smashed together in surveys and in consumers’ minds.  For younger people, having an emergency fund can be much more important, despite the reality that our our tax code heavily favors retirement savings (actually, our tax code does NOTHING for emergency savings, which is a travesty).

For young adults, there can be understandable reasons to postpone retirement savings — after all, it’s hard to worry about the future when the present is challenging (though it’s unwise, mathematically).  But failing to have a personal safety net is a much greater menace. You can’t stand up to an unfair boss when you fear losing your home.  You might even be afraid to job hunt. You don’t go to the doctor when you are afraid one medical bill could send you to ruin.  Most important, you don’t sleep very well at night when you can’t see even two or three months into the future.

Click to learn about The Restless Project

Click to learn about The Restless Project

Back once more to the Harris report. The average emergency savings for all Americans, male or female, was $46,000. That’s barely enough to handle a single medical emergency, so there is no gender war over these results. Many Americans’ live their lives  far too close to the edge right now, and have been for some time.

But my Restless Project correspondent called my attention to a group she felt wasn’t getting enough attention: “the working poor who cannot get a fair deal….. single women and single women of age.”  And she’s right.  The numbers, rough as they might be, tell a story that can’t be ignored — women have about half the emergency savings that men do, and that’s an emergency we must deal with now.


Wikimedia Commons (click for original)

Wikimedia Commons (click for original)

Rents are increasing in most parts of the country. That normally nudges apartment dwellers into the housing market — as rents rise, so do reasons to buy a home — but that doesn’t seem to be happening in today’s topsy-turvy housing market.

Instead, many renters are swallowing the increases and staying put, suggests new research by Freddie Mac.

“We’ve found that rising rents do not appear to be playing a significant role in motivating renters to buy a home,” said David Brickman, EVP of Freddie Mac Multifamily. “This contradicts what some in the housing market think as they expect more renters ought to be actively looking to purchase a home. We believe rising rents are primarily a sign of increased demand rather than a signal that home purchases will be increasing.”

There’s a simple answer, of course. House prices are rising in many areas, too, tilting the rent / buy equation back towards renting.  According to Zillow, the break-even point at which buying saves money over renting has actually stretched from 1.5 years to 1.9 years in the future, on average.  In places like California, it can take five years to profit from buying over renting.

But since all housing is local, the “should I buy?” question is complex right now.

Rents rose 3.6 percent in 2014 and are expected to rise 3.4 percent above inflation this year. Rents are up even more in cities like Seattle, Charlotte, Portland, and Denver. It’s clear landlords have the upper hand in many places, creating tremendous future cost uncertainty for renters.

Some 38 percent of renters said they’d experienced an increase in the past two years.  Many in this rent-raised group would like to buy a home, but 70 percent told Freddie Mac they can’t afford it, and 51 percent said they’d put off plans to buy a home. In fact, a substantial number of renters are headed the other direction: 28 percent said they were considering or had already begun living with a roommate; the same number said they “need” to move into a smaller rental.

Since Freddie Mac did a similar survey last August, positive attitudes towards renting have even ticked upwards, despite the rent increases.  In the most recent poll, 72 percent agreed with the statement that renting provides “protection against declines in home prices,” compared to 66 percent last year.  And 80 percent like that renting offered “flexibility over where you live,” compared to 68 percent last year. That’s important for young people — anyone, really — who sees very little long-term security in their job.

Renting continues to be an appealing choice to young adults who might otherwise be entering the housing market, which tells part of the story about the up-and-down housing recovery.  The mixed bag of data reports continued this week. New housing starts surged in April to their highest level in seven years, a hopeful sign for those cheering on higher housing prices. Meanwhile, existing home sales sank — in part because of rising prices and shrinking inventories. Stories of renewed local bidding wars and prices selling above list price can be spotted from Boston to Seattle.

High prices, of course, are bad for renters and other first-time homebuyers. More than one-third of U.S. households now rent their homes, and renters account for all net new household growth over the last several years, says Freddie Mac.

“From a purely affordability standpoint, renters who have saved enough to make a 10% down payment are better off buying in the majority of markets across the country,” said Daren Blomquist, vice president at RealtyTrac. “(But) keep in mind that in some markets buying may be more affordable than renting, but that doesn’t mean buying is truly affordable by traditional standards… In those markets renters are stuck behind a rock and hard place when it comes to deciding whether to try to buy or continue renting.”

The chief thing keeping renters in their apartments? That obvious, says mortgage broker and housing expert Logan Mohtashami.

“Main street America simply doesn’t have the income,” he says.

Keep your eye on the rent / buy issue as we move forward in the recovery.  Last year, the National Association of Realtors said first-time buyers represented only 33 percent of the market, a three-decades-long low. It’s possible we’re seeing some kind of fundamental shift in the way young adults set up households.

For more on why renters do or don’t become buyers, here’s an interesting paper on the New York Fed’s website.

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Take a break. A real break.

Take a break. A real break. (Bob Sullivan)

The summer vacation season begins this weekend — by tradition, anyway — as millions of you head out for Memorial Day fun.  Regular readers of this space know that I think the classic American vacation season is under assault, thanks to a dastardly combination of a tough economy and always-on gadgets.  (Americans get less vacation than workers in almost any developed nation, yet they don’t even use the paltry vacation allowances they receive).

Now there’s fresh evidence that the notion of getting away from it all is in serious trouble. It arrived in my inbox this week in the form of a survey conducted by Citi for its credit cards.  About half of those surveyed said they are more likely to choose weekend trips over long holidays than they were five years ago.  So: Long trips out, weekend trips in. (“Frequent” weekend trips, Citi stressed to me.)

A recipe for the restlessness I’m writing about in The Restless Project. 

There can  plenty of reasons for this, some good, some bad.  One could argue that a summer full of three-day weekends is better than a two-week trip to Wherever National Park.  I suspect that’s not what’s happening here, however.  I suspect many workers feel they couldn’t possibly leave their cubicles for more than 7 days at a time. Heck, it’s easy to find workers asking each other online, “Does your boss allow you to take more than one week’s vacation at a time?”

Other factors contribute, too.  Now that dual income households are standard, scheduling vacations can be a nightmare.  Getting two bosses to a agree to two weeks — and having those weeks line up with summer camp or travel team schedules — can seem almost an impossibility.

Shorter trips can be cheaper, of course — let’s just assume folks don’t travel as far away when going away for the weekend.  I also imagine folks who don’t really disconnect from office technology (nearly everyone) also somehow feel better knowing they aren’t that far from home, in case they are summoned back by some pseudo crisis.

There is more data to suggest vacations are shrinking. The U.S. Travel Association told Crain’s Chicago not long ago that back in  1975, the average vacation lasted more than a week. By 1985, the average vacation had shrunk to 5.4 days, and by 2010, according to the group’s latest data, the average stood at 3.8 days. (Crane’s Chicago)

Eh, who cares about data? There’s plenty of data showing how important real breaks are to the mind and body, but many people (and companies) are pretty much just ignoring it.

But you don’t have to! Make this the summer you finally plan a real getaway. There’s still time! And as you’ll see in a story I’ll post later, this summer will be a great year to take a road trip, thanks to lower gas prices.  I’m already planning mine. Don’t settle for weekend trips where you don’t even bother to unpack your luggage.  It’s Memorial Day, for heck’s sake. Take a real break.

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See more foreclosure data at RealtyTrac

See more foreclosure data at RealtyTrac

Roughly 7 million Americans lost their homes during the Great Recession. Now, seven years on, the first wave of those consumers might be ready to dip their toes back into the housing market, as their credit reports are finally clean of that negative entry. The group has been dubbed “boomerang buyers.” There’s disagreement about how many of this group will — or already have — decided to take the plunge back into homeownership, and how much that might help the economy. But it’s possible the boomerang group could suffer from being once bitten, twice shy as they weigh their new options.

(This story first appeared on Read it there.)

It takes seven years for negative events like foreclosures to disappear from a consumer’s credit report, though the impact of the event lessens over time. Also, mortgages sold to consumers only five years after a foreclosure can be re-sold to Fannie Mae and Freddie Mac, making this group attractive to banks. Consumers who engaged in short sales get an even earlier reprieve — their loans can be re-sold after three years.

According to FICO, the seven-year anniversary of a negative event doesn’t necessarily mean a dramatic difference in credit scores. A consumer who filed for foreclosure with a less-than-great credit score of 680 could see their score restored to that level in as little as three years, for example.

“While a foreclosure is considered a very negative event by your FICO score, it’s a common misconception that it will ruin your score for a very long time,” according to FICO. “In fact, if you keep all of your other credit obligations in good standing, your FICO score can begin to rebound in as little as 2 years.”

Still, much has been made of the seven-year “anniversary” of the Great Recession. The National Association of Realtors this week said that it believes 950,000 formerly distressed homeowners have become re-eligible for mortgages and have “likely” purchased homes, and another 1.5 million will re-enter the market during the next five years.

“The deep wounds inflicted on the housing market during the downturn are finally beginning to heal as distressed sales continue to decline and home prices in some parts of the country have bounced back to their near-peak levels,” said Lawrence Yun, chief economist for the Realtors organization. “Borrowers with restored credit will likely have the ability and desire to own again, encouraged by the long-term benefits homeownership provides in a stronger economy and more stable job market.”

Access to mortgages is increasingly important as rental markets overheat in much of the country — in some places, owning is cheaper than renting, at least based on monthly payments.

But not everyone agrees with the Realtors’ calculations that millions of consumers have or will be become boomerang buyers.

Housing analyst and loan manager Logan Mohtashami believes the numbers are far lower, citing Federal Housing Administration data showing only about 2,000 buyers with foreclosures on their records used FHA loans last year. Consumers can get FHA mortgages in some circumstances only three years after a bankruptcy.

“The market (for boomerang buyers) just isn’t as good as they think it will be,” he said. “Forget about the timeline (for clearing their credit reports). People in this group have to re-establish credit, and they have to have a down payment, which Americans with good credit and three jobs have trouble with.”

Mohtashami has seen a few boomerang buyers in his office. All of them have been short-sellers rather than foreclosure victims, he said.

“Those people look a lot better as candidates right now,” he said. “Many of them never missed a house payment.”

RealtyTrac data indicates 7.3 million consumers lost their homes between 2007 and 2014. The vast majority experienced foreclosure — 5.4 million. Still, that leaves 1.9 million short-sellers who might be excellent candidates to buy a home again.

Many in the group may not be in the mood, however. Once kicked out of homeownership, twice shy — and renting does have advantages.

“I won’t be buying again. I pay a decent rent now, and everything gets fixed and taxes get paid for me,” said one consumer, who asked that her name be withheld. “I would rather invest my money and have more for retirement rather than a house which ends up being a big money pit all over again.’

Still, with rents rising at twice the rate of wages since the year 2000, consumers can’t write off the idea of homeownership.

RealtyTrac says that the Phoenix area has the most potential boomerang buyers, with 350,000 potential buyers from 2015 to 2022. And the best year for boomerangs will be 2018, with 1.3 million consumers enjoying credit reports that are clear of their housing loss.

Short Sales Bank Repossessions (REO) Total Potential Boomerang Buyers
2007 146,510 404,849 551,359
2008 170,698 848,605 1,019,303
2009 264,741 861,086 1,125,827
2010 278,711 1,046,092 1,324,803
2011 321,381 791,203 1,112,584
2012 305,115 667,760 972,875
2013 232,649 488,356 721,005
2014 128,520 327,069 455,589
2007 to 2014 Total 1,848,325..   5,435,020 7,283,345

“The housing crisis certainly hit home the fact that homeownership is not for everyone, but those burned during the crisis should not immediately throw the baby out with the bathwater when it comes to their second chance at homeownership,” said Chris Pollinger, senior vice president of sales at First Team Real Estate, in a report issued by RealtyTrac. “Homeownership done responsibly is still one of the best disciplined wealth-building strategies, and there is much more data available for homebuyers than there was five years ago to help them make an informed decision about a home purchase.”

As your credit recovers from an event like a foreclosure or a short sale, it’s especially important to check your credit reports and credit scores. You can get your free credit report summary updated every month on to track your progress and watch for errors.

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ApartmentsIt’s already hard enough to find an affordable home or apartment to rent (especially if you live in one of these cities). Rental prices are rising fast around the country, even in unexpected places like Kansas City and Portland. But as more people turn to online help to find a decent home, there are more scams and gotchas to worry about, too.

First, let’s look at prices. Nationwide, rents are up about 3% in the past year, according to Zillow, with median rental cost at $1,350 monthly. That increase is not out of line with historical trends, but as we say often, all real estate is local. And in most major markets, rents are up a lot more than that. Seattle is up 5%. Charlotte is up 6%. Portland, 7%. And when you get to Denver, San Jose and San Francisco, you’re looking at double-digit increases.

To put things in perspective, since the year 2000, rents have risen at twice the rates of wages — and that’s a problem for everyone, even homeowners.

“Today’s renters are tomorrow’s buyers, but with more income devoted to rents, less is socked away in savings accounts for an eventual down payment on a home,” Zillow notes. One factor (of many) that is stifling the housing market is lack of new buyers.

Rents are so high that RealtyTrac recently published data saying that buying is more affordable than renting in 76% of U.S. markets — but that’s only true for renters who have socked away cash for a down payment. With so much income going to rent, amassing a 10% down payment gets harder and harder.

All this means that searching for the right apartment at the right price is more important than ever, and the Internet is the obvious place to look. Craigslist has long been one of the most popular places to hunt. There are plenty of new entrants, however. For starters, HotPads and Lovely put usable front ends on top of apartment listings, so they are helpful. Mobile, location-based apps like RadPad have obvious advantages if you are walking around a city looking for places. Trulia, known primarily as a homebuyer site, is good for renters who want something bigger than an apartment.

But scammers invade all these sites. They know that apartment hunters are particularly vulnerable. Many are looking remotely, before a move, and have to trust information — and sometimes money — sent over long distances. Showing up at unknown addresses and chatting about finances with strangers always poses some risk. At some point, renters have to give a potential landlord their personal information. Most of all, renters are almost always under pressure. They have to get a place within a couple of days to move out of corporate housing or their friend’s basement or whatnot. Put all those things together and you have a recipe for disaster.

As a renter, you simply must take the attitude that any potential landlord might be a scam artist. After all, landlords look at you that way. So here’s three things to watch for.

1. Simple Identity Theft

The most common rental scam, and the easiest to pull off, involves identity theft. Criminals post fake ads and trick renters into filling out some kind of application, which always requires enough information for the criminal to open up fake accounts in the victim’s name. Antidote: Never surrender any information until you’ve seen the place, and the landlord, in person. One trick that’s sometimes successful: Get your free annual credit reports at, blot out the Social Security number and other personal information, and offer that as a credit check to a landlord. Many won’t go for it, but some will. It can at least be used as a stall tactic while you are determining if the landlord is legit. (It’s also a good idea to keep an eye on your credit reports and credit scores, especially during this period. You can get your free credit report summaries on to monitor for any changes — for example, new credit you didn’t apply for — that could signal a problem.)

2. The Prepayment Scam

Another common rental scam involves getting a would-be renter to send money for an apartment that doesn’t exist, baited by a fake listing that’s been pilfered from another rental site. That’s usually a hard sell, so scammers add a wrinkle. They concoct an elaborate story about traveling, or an illness and create a sense of urgency — mainly by suggesting the rental is a great deal that’s about to disappear. Then, they ask for a form of payment that’s hard to reverse, such as a wire transfer or prepaid card as a deposit, or to cover the first month’s rent. While these scams are often attempted on long-distance renters, that’s not always true. Some victims are even advised to drive past the not-really-for-rent apartment, giving them a false idea that the real estate actually exists. Antidote: Don’t send money before you see the inside of the place.

3. Scammers Revenge

Kelly Kane, who was hurriedly looking for an apartment in Massachusetts after the ceiling in her current pad collapsed, found out the hard way that scammers have a nasty new way of exacting revenge when consumers don’t fall for their ploys. After she called out a would-be con artists on a fake ad, her cellphone number was plastered as the contact across hundreds of ads on Kane’s phone was ringing off the hook for more than 24 hours before she was able to get the bogus listings pulled down.

“I’m guessing it was for spite,” Kane said. “My phone has rang about 20 times from states all over the U.S. with people responding to these sketchy ads. Sad thing is, I spoke with some of the people and one woman said she was so sick of dealing with these scams and made it sound like she’s had several she’s dealt with.”

Kane isn’t alone: There are several other complaints about the phenomenon on Trulia’s message boards.

Antidote: This is a tough one. It’s hard to hunt for an apartment without sharing your phone number with strangers. Your best bet is to be really judicious about emailing your number before you speak to a would-be landlord — try calling first. And if that doesn’t work, be very suspicious of too-good-to-be-true listings, or even a-little-too-good-to-be-true listings.

What do all these scams have in common? They all involve a cover story that prevents hunters from seeing the inside of any apartment before some important transaction or information transfer takes place. Knowledge is power. No matter how elaborate the tale, keep bringing the story back to its basics. Is the landlord insisting on getting money or personal information before showing off the place? If so, something is almost certainly wrong.

(This story first appeared on Read it there)


See the original Smoking Gun report

See the original Smoking Gun report

There’s something about computers that brings out the worst in us. And there’s something about retaliatory violence against these boxes of frustration that makes (many of) us cheer from a place deep inside.

Computer rage is a real thing; there’s a whole section on it in my book proposal about The Restless Project.  You know where I’m going with this.   A Colorado Springs man named Lucas Hinch was arrested this week for challenging his desktop computer to an old-fashioned duel.

According to The Smoking Gun, he said, “I just had it,” and mentioned something about the “blue screen of death.”  So he killed the computer by pumping eight bullets into it.  The police blotter entry reads “Man Kills His Computer.” Finch discharged his weapon within city limits, which was a violation. A court date awaits him, where a judge will decide his penalty.  Don’t be surprised if the judge applauds.

One of the most popular stories I’ve ever written involved a dad shooting his daughter’s laptop, and filming the execution, as a public form of punishment.  (That execution also took eight bullets).  The story caught fire because it captured how many parents feel about their kids’ gadgets.   Finch’s tale might not reach the same dizzying TODAY heights, but I won’t be surprised if he gets 15 minutes out of it.

Why? Because computer rage is a very, very real thing. Inspired by a viral set of videos posted online showing half-crazed users smashing, crashing, throwing, slamming, or otherwise inflicting pain on their computers, Professor Kent Norman of the University of Maryland coined the term “computer rage” about 10 years ago. In a survey, he got some half-crazed people to fess up to their acts of techno-violence. Here’s some of what they told him. Don’t judge. Only those who’ve never thrown a gadget should cast a stone.

“I ruin computer desks and chairs venting outrage. Throwing computer mice around also helps… Sometimes I headbutt the monitor screen.”

“Run the ******* over with my truck!”

“Poured gasoline on a computer and set fire to it.”

“One time I took a linksys router out to my driveway, smashed it open with a hammer, covered (soaked) the inside with WD-40, and lit the sucker on fire. It burned for quite a while. I took pictures and sent them to linksys and told them how angry I was that their tech support wouldn’t give me answers.”

“I name my computers, and I use their names pretty much only when I’m mad at them. When my old computer, Charles, use to be bad..I’d yell, but then I tried giving him hugs instead.”

And finally:

“I scream at my computer because I know that it hears me and is laughing at me.”

Have you ever done any of these things? Have you ever dreamed about it?  If your answer is no, you really need to get more in touch with your feelings.

I kid, but I’m serious.  Computer frustration is special kind of angry.  It contributes to high blood pressure, vision problems, and even family issues.  That’s why it’s an important part of The Restless Project.


Click to learn about The Restless Project

Click to learn about The Restless Project

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AARP job loss incomeIn the 1970s Sci-fi movie Logan’s Run, viewers are let in on a dirty little secret about a Utopian society — everyone gets killed at age 30.  Sure keeps labor costs down.

America hasn’t quite become Logan’s Run, but we seem to be tilting that way. It’s no secret that older workers — and by older, I mean over 45 — have had a really rough time recovering from  the recession.  Human resource departments love to sort spreadsheet by income and just lop off the higher-paid workers, who are inevitably the most experienced. And the least equipped to hunt for a new job, what with all those 20-somethings out there who are ready to work for next to nothing. A new study from AARP this month reveals this isn’t just middle-aged bitterness.  The phenomenon is probably worse that you think.

Fully 48 percent of previously unemployed workers aged 45-70 have taken a job earning less, AARP writes in a report called The Long Road Back: Struggling to Find Work After Unemployment. And more than half were forced out of their chosen occupation, which no doubt influences the first data point there. Mid-career adults with 20 years experience in one field can end up at the bottom rung in another field, fighting for scraps with the recent college grads. About 40 percent told AARP they were earning “a lot less” at their new jobs.

Second Act? What about a third, and a fourth…

Nothing breeds insecurity like knowing you are working in a dying field.  Problem is, change is so fast now that all of us — yes, you too– are horse and buggy drivers.  And we don’t face just one big career change. It’s continuous change, over and over.  Professionals with decades of experience can’t feel secure they will have respectable work in their critical 50s and 60s. That’s a looming disaster for our society. TV commercials for brokerage houses aimed at the rich constantly extol the virtues of a “Second Act.”  Out in real America, people are facing third and fourth and fifth acts.  It’s crazy. And it’s another reason we’re all so restless.

Perhaps you recall last year’s Restless Project road trip across America, and my profile of  Trina Foster-Draper, a 56-year-old single mom of four.  She had recently laid off by CenturyLink in Logan, Utah, where she’d worked in customer service for nearly six years.  She headed back to school to study computer stuff, about to begin, by her count, her Fourth Act.

“Everybody has to keep changing, keep reinventing themselves now,” she said to me, sitting in her apartment she shares with her father – a brand new building adjacent to a massive Walmart. “There’s no choice.”

Why is all this uncertainty for mid-career pros such a bad thing? CNBC just ran a great series about the failure of the 401(k) experiment. I’ve been harping on this for years. Switching pensions for 401(k)s…”defined benefit” plans for “defined contribution” plans…is one of the greatest financial thefts in history.  The median 401(k) balance is $18,000, or just about enough to get you through the first 3-6 months of retirement. Older folks within 10 years of retirement have a median of $75,000, which might stretch them to age 67. After that? Hello, Walmart.  Meanwhile, all these mutual funds in all these token retirement accounts are leaking 1 to 2 percent of their value to Wall Street every year in fees. It’s unconscionable.

As a practical matter, the reality for most folks today is that they realize how bad things are in their 50s…or, if lucky, in their 40s…and start loading up on 401(k) contributions. (It’s a very good idea to exceed the minimum required for your company match, if you get one).  Problem is, this is precisely the age group that is hit hardest by job loss.  Right as they need excess income to start planning  for the inevitable, they are shoved into a new field and back down the income ladder again. It’s wildly unfair.

“A lot of them are in their pre-retirement years, when their earnings are supposed to be the highest in their lives,” said Lori Trawinski, one of the report’s authors, according to a great story by colleague Rich Eisenberg in Forbes.  Instead, Trawinski said, older workers are more like to end up in part-time jobs than other unemployed. It’s simple: “It’s much more difficult for older unemployed people to get rehired than younger ones.”

Laying off experienced workers to hire cheap, young replacements, and leaving the older folks to fight over crumbs, well…that’s the stuff of Logan’s Run. 

Are you facing the issues raised by the AARP report? Let me know.  We need to talk more about this.

Click to learn about The Restless Project

Click to learn about The Restless Project

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the news





Click for my story on CNBC

Click for my story on CNBC

It has been gnawing at me for a while. Why are are most professional sports leagues hurting for offense?  After all, we live in the age of spreadsheets and video cameras. Every athlete has access to hundreds of angles on every action they take on the field, or in the rink.  Every swing, every shift, is chronicled by a bevy of assistant general managers and an army of bloggers.  Shouldn’t all this information be helping hitters and scorers?

Then it hit me: Big data might as well be hold up a sign that says D-FENSE! Everywhere that advanced analytics arrives, a scoring drought seems to follow.  All that information seems to be one-sided.  I started talking to sports folks and found my new theory rang true to them.  In basketball, analytics helps force top shooters just slightly out of their comfort zones.  In hockey, it helps unlock the secrets to “shot suppression.”

As the person that CNBC once dubbed the “Big Data Hater,” I realized the theory fit neatly with my skepticism of the quantitative managing that has swept through American corporate culture — the notion that if you can’t count something, it’s not valuable.  Hugh Thompson and I explored the this “data idolatry” in our book The Plateau Effect.  But here was an even more concise explanation of the problem. Moneyball, analytics, big data — whatever you call it, I worry it has put much of our culture on the defensive. I explored the theory recently in a column for  The beginning of the piece is below. You can read the rest at CNBC. 

If you are wondering why you feel your place at your company is so fragile, why your creativity has trouble fitting into your annual review forms, or why you are feeling so restless, I think this is part of the problem.  Here’s the top of the piece to whet your appetite:

Is big data behind scoring drought in professional sports? And your business?

As spring training brings the familiar sounds of baseball, and the annual renewal of foolish optimism that this might be the Cubs’ year, Major League Baseball is hoping for something even more dramatic — more runs. From anyone.

Baseball is in a crisis not seen since the 1960s. Pitchers ran circles around hitters last year, with runs per game and batting averages at decades-long lows. There was an epidemic of defensive 2-1 ball games last year — this at a time when baseball is struggling to remain popular with younger, supposedly attention-span-challenged fans.

But it’s not just baseball. The National Hockey League has an offense problem, too. The game’s biggest star, Sidney Crosby, has only 20 goals three-quarters of the way through the season. Goals per game have shrunk since the 2005-2006 season. And in the NBA, hot-shot scoring has also declined. In the2007-2008 season, there were 27 players who averaged more than 20 points pergame. Today there are 15.

What in the wide-wide-world of sports is going on here? If you own spreadsheet software, you know that advanced analytics are the biggest change to hit professional sports in the past decade. As Michael Lewis explained in his book “Moneyball: The Art of Winning an Unfair Game” that popularized the revolution, sports franchises will do almost anything to get a leg up.

Geeks with video cameras track everything now. Baseball has its spray charts. Defensive shifts based on those charts are so effective that some critics have suggested banning them. Hockey has its Corsi and Fenwick, which measure shot attempts during ice time. The National Basketball Association uses PPP, or points per possession now.

But a funny thing is happening on the way to refining these sports — big data had chosen sides. Moneyball tactics seem to help the defense more than the offense. The tiny tweaks and refinements suggested by nerds are simply better at stopping players than enabling them.

It’s a lot harder to find and exploit defensive weakness than offensive weakness. There’s a lot more available data on what offenses are trying to accomplish than on what defenses are trying to suppress. To play a little loose with an aphorism, it’s a lot easier to criticize than create.

What does this have to do with your business? Businesses are projected to spend nearly $40 billion in big data technology this year,according to collaboration site,most of it with the idea of Moneyball-ing their companies.

It seems like a no-brainer — run a few spreadsheets, find a few million dollars. But I think there’s a flaw in big data that’s big enough to drive a slap shot through. As in sports, big data helps defense more than offense. That might mean companies are spending a lot of money so they can be penny-wise and pound-foolish.

In the corporate world, playing defense means things like limiting overtime and shrinking health care benefits costs. Offense means finding new markets and inventing new products. Big data is great at optimizing work schedules to minimize labor costs, but not nearly as good at giving employees extra time to tinker with a potentially profitable idea.

Economist Tim Harford, author of the book “The Undercover Economist Strikes Back,” has been a critic of big data because its users often seem to forget that no matter how large a dataset is, it’s still subject to sample bias that leads to errors. It remains true that 5,000 carefully-selected survey takers provide better results than a billion random Google searchers. And he thinks sample bias might be part of why data helps defense more than offense.

“Data analytics are excellent at finding subtle historical patterns that might then be exploitable. They are much less useful at suggesting something radically new, or producing a response to something new,” he said. “Analytics favor the optimiser, the tweaker, but usually not the radical disruptor. Analytics help Google and Facebook optimize their services, but they didn’t really help Jony Ive and Steve Jobs create the iPhone.”

Read the rest of this column at

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A better way to buy and sell homes?

March 20, 2015 The Restless Project

The biggest barrier for many would-be homeowners is the pile of cash that’s needed before a bank will even discuss a mortgage. The Federal Housing Administration, in an effort to boost the housing market, recently lowered down-payment requirements to 3.5% of the purchase price, but by the time would-be buyers consider closing costs, they still need roughly […]

Read the full article →