Oh how I miss affordability...

[MIKEETC]

Originally Posted by motoman

Indeed. It amazes me how willingly people spend money on things like that, as if they have an endless supply of money. I wonder what they give up in order to be able to do that?

They may only do that rarely...like when someone says, "I'm not cooking today...!" or when the kids are with grandma.

[motoman]

Originally Posted by SOON2BNSURPRISE

It sounds like an undelying complaint about not having the cash to live as one pleases in the LA area.

Well, actually I do have the cash, I just place little value on things like eating at trendy restaurants or drinking at trendy bars or spending more than I think is reasonable for something just because someone else is willing to spend that kind of money on it.

It's the reason I shop at places like Smart & Final, Costco, 99 Cent Store, Wal-Mart, Target, etc. Why pay $5 for deodorant at Ralph's when I can get the exact same thing at Target for $2?

And it is true that there is a lot of money in LA, but there is also a lot of money in Dallas and other lower cost large cities. The difference is that people in LA, in general, for some reason are willing to be house poor or to go into extreme amounts of debt to sustain an unsustainable lifestyle. And relative to the size of the population the number of uber-wealthy people is incredibly small.

The housing bust is the perfect example. There isn't remotely enough income in the LA area to support housing prices, even at today's levels. And all those cars, big screen TVs, etc., that were purchased over the last 5 years were paid for with debt. People don't actually have the money to buy this stuff. They just accelerated their purchases by borrowing. And you see where that got us.

BMWs and Mercedes are so popular because people want to portray the imagine that they have the money for these things when they don't at all. In 2007, 2/3 of BMWs "sold" in the US (highly concentrated in areas like LA) were leased. Mercedes was less, but still over 50%. People don't actually have the money to buy these things, so they rent them.

[EscapeCalifornia]

Originally Posted by motoman

BMWs and Mercedes are so popular because people want to portray the imagine that they have the money for these things when they don't at all. In 2007, 2/3 of BMWs "sold" in the US (highly concentrated in areas like LA) were leased. Mercedes was less, but still over 50%. People don't actually have the money to buy these things, so they rent them.

And a big percentage of the ones that were purchased, were purchased with home equity that's since evaporated. Very few people (as a percentage) can actually afford a $5000/mo house and a $1000/mo car.

[motoman]

Originally Posted by EscapeCalifornia

And a big percentage of the ones that were purchased, were purchased with home equity that's since evaporated. Very few people (as a percentage) can actually afford a $5000/mo house and a $1000/mo car.

Very good point.

[RiWrites]

It is sad that people don't realize they have to downsize in order to survive but would rather spend all their money on a stupid car just to look important. One good wreck and that fancy car is just scrap metal. I knew a guy like this when I lived in LA. He lived in a crappy apartment with no furniture, mooched off of friends for food but spent money on an expensive car. His reasoning is if he pulled up to auditions in a fancy car the people would think he was important and give him the job. It didn't work. When I left he was still struggling.