Mulligans Blog

by Mike Mulligan

Those that are getting their regular paychecks may not feel it. Those that read and hear of others going through bad times, may still not get it. Real estate publications, economists, prognosticators, politicians tell us things are getting better. Some of us are scratching our heads.

Unemployment hits 11% in Florida, the dollar collapses, gold prices near record highs, foreclosures, bankruptcies, short sales, people moving in with other people, vacant houses, people can’t get credit, people can’t afford their real estate taxes, cities are going bankrupt because no ones paying their taxes, higher crime rates, people jumping off of bridges, people acting like their losing children in hot air balloons. Are these strange times we’re living in or what?

Business owners, entrepreneurs, people in sales, independent contractors, and those that don’t get regular paychecks don’t know what to believe anymore. They read things are getting better, but why don’t they feel better? The stock market is inching up, ok. But what’s causing this…. book manipulations? layoffs which produce higher profits? Google clicks that tell us people are thinking about buying? holidays coming up? who knows? They are real numbers, yes, but what do they tell us? Yes, the market has been rising since March of this year.

But we all know something’s not right. We haven’t seen this in our lifetime, unless you lived in the 20s and 30s. I was selling real estate in the 80’s with interest rates at 17 ½%, but this is different. There are more societal ills, things are more complicated.

Something’s definitely broke. Obama is bailing everybody out and is on a Christmas buying spree. He wants to spend our way out of this recession, but what will the consequences be? Runaway inflation, socialism, or the downfall of the American society as we know it?

Our only consolation is that we live in a world economy now. Everyone is hurting. Our countries are interconnected economically. It is a world recession. We won’t stop buying Japanese cars, because Uncle Sam asks us nicely. We can, however, start developing and enabling new technologies that are already here.

We need to develop the electric car and its infrastructure. This will bail us out and start the cycle of prosperity again. Millions of jobs will be created by this development, we will start eliminating burning of fossil fuels, and this will set us in the direction of the “green economy”.

Many studies and research have concluded this. Larry Burns, the retired head of GM’s research and development, has said that the electric-vehicle age will reshape the energy grid, redefine driving patterns, and generally improve the quality of life especially in urban areas.

First, there will be many types of electric vehicles, including the plug-in hybrid, the all-battery vehicle, and vehicles powered by the hydrogen fuel cell, which is essentially a battery fed by external source of hydrogen. These vehicles will come in all shapes and sizes, including all-terrain vehicles to large commercial trucks. These different vehicles will be able to tap into many different energy sources.

Solar, wind, or nuclear power, all free of co2 emissions, can feed the power grid that will recharge the batteries. Also, these energy sources can be used to split water into hydrogen and hydroxyl ion, and then use the hydrogen to power the hydrogen fuel cell.

Second, the storage capacity of the vehicle fleet will play an important part in the stabilizing of the power grid. Not only will the battery powered vehicles draw power from the electricity grid during the recharging, but when parked, can also feed additional power back into the grid, during periods of peak demand.

Third, the electric vehicles will open up a new age of smart vehicles, in which sensor systems and vehicle-to-vehicle communications will enable collision protection, traffic routing, and remote managing of the vehicle.

Automakers, utility companies, broadband providers, government road builders, and public-private funds will all have to contribute to this integrated system. The beauty of it is, it’s already here, but it needs to be implemented and expanded in America. A company called Better Place has already built some of the infrastructure with battery swapping stations and recharging stations throughout Europe, Japan, and Israel. America must stay at the forefront of the implementation and development of this new coming electric vehicle age. Tomorrow is too late.

Several other studies have been done to show how many millions of jobs can be created throughout the world by implementing the electric car, its infrastructure, and the subsequent green technologies. The new age of the electric vehicle illustrates the opportunities that are now available as we make our way from unsustainable fossil-fuel technologies to a new age of sustainable technologies.

This is true not only for automobiles but in the choice for energy systems, building designs, urban planning, and food systems. So in a way the breakdown of the world economies has provided an opportunity for the new green revolution to evolve.

http://www.mulliganslist.com/2/posts/13_Entertainment_/308_Headlines/5420_Is_the_market_rally_a_hoax_.html »

http://www.mulliganslist.com/2/posts/13_Entertainment_/308_Headlines/4674_VIDEO_Better_Place_battery_swapper_demonstrated.html »

http://www.nytimes.com/2009/10/20/science/earth/20fossil.html?_r=2&scp=4&sq=carbon%20cost&st=cse »

As the warmer December winds move in the Bay area, producing humid 90 degree temperatures, many have uttered the words “global warming”. I remember seeing the Jacque Cousteau documentaries and NASA films of dying fish populations, receding coral reefs, crashing ice bergs in Greenland, polar bears hopping from one ice fragment to another starving looking for food, maps showing the melting lands in Antarctica, and stories of holes in our ozone layer getting larger. But is this all an illusion? Is there really global warming or is this made up science?

A news story is out right now called “Climategate” that purports that hackers found e-mails of scientists manipulating data concerning our climate and global warming. There is in fact conflicting evidence and all scientists don’t agree, although most do agree that global warming is real. Interesting though, is the timing of the hacked e-mails as they came out right before the Copenhagen Conference. This suggests an inside job and another political spin. Some say they were the Russian Secret Service.

The green movement should not halt because of the hacked e-mails. Cleaning the earth is a good idea whether man is responsible for creating substantial global warming or not. If we err, let’s err on the side of green. What is wrong with pursuing green technologies in the name of global pollution?

Certainly we all agree that pollution has been caused by man. The smog and pollution in Los Angeles is not a natural cycle. You don’t have to be a environmental scientist to know that that pollution must have some affect on our personal health, as well as the environment.

You don’t have to be a rocket scientist to know that the millions of autos burning gas and oil, don’t smell that good, and give us headaches after smelling the carbon burning exhaust. We know that the carbon monoxide fumes can kill us if we leave the car running in a closed garage. You don’t have to a scientist to know that the birds can’t fly very well with oil on their wings. Man has caused pollution. How long can we continue to cause pollution by using unsustainable energy sources and carbon burning technologies? Perhaps in 10 years there will be no arguments or any refutable evidence to suggest that global warming is a made up science.

I am of the opinion that we need to approach these issues with a “green capitalistic” viewpoint. The green revolution can be a profitable and an altruistic endeavor at the same time as we clean up the earth and develop new green technological investments.

Opponents of the Copenhagen conference say that the transfer of wealth will occur between the developed countries to the undeveloped countries with the enormous sums (.7% of GNP) of money being asked for by this treaty. I believe the real transfer of wealth today is already occurring from the oil consuming nations to the oil producing nations. We are being held hostage by these countries economically and ideologically.

The moneys should be viewed as an investment in our planet as well as a movement to recover from the world-wide economic plight we are now in. Having a green movement will help us recover as we create millions of new jobs and focus on a single investment direction to propel us into the new century. Many studies have concluded this. Economic stimulus will be created by pursuing the new green technologies like the electric car.

Our existence and/or current lifestyles on planet earth may be in peril if we don’t clean up our act. If we err by over reacting, let’s err on the side of green.

Well, everyone wants to know what’s going on with the electric shuttles, known as “nevs”.  I own a business called “Take a Mulligan Shuttle”.  We are an electric shuttle company driving passengers around downtown Tampa, Hyde Park, Channelside Y-Bor City, Davis Islands, Harbor Islands, and the SoHo district.  We work for tips only. Because we are not licensed as a cab company we must operate this way. We are a for profit company, selling advertising on our shuttles.  The drivers work for tips only.  We are only allowed to drive on roads that are 35 mph or under.  The cabbies don’t like us, and are complaining we are taking their business.  There are four “electric vehicle” companies out there now shuttling people around Tampa, with a total of 13 shuttles.  The cab companies have over 600 cabs vying for the business and looking to expand.  Perhaps the owners of the cab companies should scale back. 

The cab companies are looking for ways to get us off the streets.  We are legal and registered with the State, and we have occupational licenses with the city of Tampa.  The Downtown Partnership endorses us.  The patrons and tourists love us.  There were a couple of articles written about us, one in the St Pete Times and the other one in the Tampa Tribune.  Of the twenty four comments, twenty three were favorable to our position.   I have posted these articles and the subsequent comments on my website at www.mulliganslist.com.

The cabbies are complaining that their bottom line is down, amongst other complaints.  But, everyone’s bottom line is down right now.  We are in the midst of a major recession, not seen since The Great Depression 80 years ago.  Americans are looking for different ways to make a living, and are cutting back on expenses.  No doubt we are in fact taking some business, but not as much as they complain about.  Our niche is the short runs that cab companies don’t want.  We are also converting people who are walkers and didn’t even consider a cab. There is plenty of business outside of the enterprise zones that we can not drive on. Again, we are only allowed to drive on roads 35mph or less.  I have many people remark to me that, “Mike it seems like this business should have been around a long time ago”.  No one was handling the short runs.  I have some clients who are blind, handicapped, and elderly that absolutely love us and depend on us.  We have been in business for over 9 months now and we have our group of regular customers.

This is America, and we are green, and we are new.  We are exactly what President Obama wants, green, lean, and part of the new order.

We want to be registered and licensed, at least my company, “Take a Mulligan Shuttle” does, as long as the city of Tampa doesn’t charge us with huge fees.  St Pete has just instilled a new ordinance for us to be licensed and registered with them.  They made a new category for us to be licensed.  Perhaps Tampa should follow St Pete’s lead.  I think we should have background checks done and be registered, fair enough.

Make no mistake about it though, the cab companies do not want us licensed, they want us off the streets.  Some politicians are listening to the cab companies complaints with concern.  The cab companies have made a lot of friends over the years but they are a dinosaur.  Again, we are not really taking that much business from them.  I think they are concerned with proliferation of the electric shuttles than the current situation.  They have 600 plus vehicles, we have 13.  It sounds like a David and Goliath story here. 

They are pulling reasons out of the hat like, we don’t have insurance, which we do.  The carts are unsafe.  They are made with steel framework and are street legal.  Perhaps they are not as safe as a Hummer, or a large semi-truck.  But, how about those new smart cars out there.  Their frames are smaller than our shuttle frames.

Then they say, we are shuttling people around, they need to be safer than ordinary vehicles.  Perhaps we need to invent a steel tank shuttle that runs on electric power or solar energy.  But, how about those pedacabs, bicycling people around with passengers.  Certainly we are safer than the pedacabs.  If these vehicles are so unsafe, how come we get hundreds of calls on a weekend, for us to go ahead and pick them up.  Apparently people are taking that risk to ride the shuttles.   Politicians don’t need to hold our hands and make every decision for us.

  Two of my  drivers are licensed and trained to drive trucks.  I have known my drivers for years and have done background checks.  What else can we think of here to get these shuttles grounded and make those taxi cab drivers happy.  The solution is to cut back on the number of cabs out there.  The market should dictate the number of cabs as well as the number of nevs out there not the politicians.  Again, we are in a major recession, and everyone is scaling back, looking for cost cutting alternatives.

They are thinking up more complaints everyday.  Perhaps they will think of: we are wearing a shirt and tie and that’s an unfair advantage, or we speak better English, or we are putting more lights on the vehicles, or we are tailgating them, or flashing our bright lights at them, or we are overall trying to intimidate them with our large “green” vehicles.

Ladies and gentleman, these electric vehicles are shuttling people around all over the world.  Our country has them in a few states like Arizona, California, and a few other areas in Florida. We are not re-inventing the wheel here.   We need to conserve, slow down, and look for renewable forms of energy. 

Why does are society need to be so reactionary.  Oh just wait to one of those shuttles gets into an accident.  This should not stop our movement of going green, conserving, and finding new ways to live pollution free. 

The new electric cars are now coming out in the headlines all over the world.   We had this technology in 1917.  The first cars were electric.  Nay sayers are saying that the  electric cars are not exactly pollutant free.  The batterys use acid, and can not be salvaged or properly disposed of.

Don’t tell me that electric cars are not more pollutant free that the carbon burning gas guzzlers.  Yes, their not perfect, but we are going in the right direction.

And the story goes on…….

Amen.

The State of the Economy.  How did we get here? 

 Ladies and gentleman capitalism is broke as we know it.  It can be fixed, however, with the right moves and legislation.  Right now we need a lot of help and the sooner the better.

Creative Financing has pulled the world down.  It was created inside the office of an investment house.  The “no verification loans”, aka  the “no doc loans” , aka the “subprime” loans were created, and they have pulled the world down, close to a world depression.  Loans were given out like candy.  Basically, at the end, if you breathed air, mortgage brokers & banks could find you financing.  The bad loans were made, foreclosures have started at historic rates, and the sunami wave of delinquent loans hasn’t even come in yet.  The banks don’t have any money to lend, so it doesn’t matter how low the rates go.  The secondary market, which is a group of investors that buy up these loans from the banks, are not buying up these loans.  Its too risky.  So the banks don’t have any money to lend.  I found this out almost 2 years ago, when I was selling houses and writing up contracts, and the banks were making up excuses not to make the loans.  They simply had limited funds to lend, and would only make loans to their best customers.  The banks have packaged these high risk loans with the good loans, and this has complicated the selling of the loans on the secondary market.

It all started with the credit scores being the most important criteria for financing.  Those with bad credit scores could find a credit cleaning company to clean up their scores, and bang, you were in business.  Many products came out.  The entrepreneaurs, that didn’t show steady income, but had made money in chunks always had difficulty getting loans.  So they came up with some products that would allow  loans based on their credit scores and minimal verifications, such as verification of their bank accounts to show income made.  Verifications of their license, office, and utilities, etc, also were used.  Now this made some sense and allowed loans to be made, and the loan business took off.

Then the verifications became less and less important, so it eventually it came down to no verification of anything (no bank statements, license, utilities, commerce record, nothing), except a good credit score, which could be manufactured by a good credit cleaning company. 

I have been in the real estate business since 1984, and a  broker since 1986, and I have never seen anything as creative and stupid as this.  In the eighties, the mortgage industry used the negative amortization loans with teaser rates.  The economy was in disaray as well.  Basically, back then the interest rates had skyrocketed to 17 1/2 %. 

How did we function?  They came up with  products called negative amortization loans.  The first year the rates were 7 1/2 %, the next year it was 9 1/2 %, the third year it was 11 1/2 %, then the fourth year it was 13 1/2 %, and the fifth year, if you made it that long, was 15 1/2 %, and it finally leveled off at 17 1/2 %, years #6-#30.  The problem was this wasn’t a buydown.  The first year, the money that was owed for interest, the difference between 7 1/2 % and 17 1/2 % was added on top of the loan.  So by year 3 you owed more money than the property was worth.   These loans served to spur the economy initially, but eventually had to be terminated because of all of the loan defaults.   This period was called the “Savings and Loan Crisis of the eighties” . 

The government came in and bought the foreclosures back from the banks and sold them at extremely low prices.  This served to spur the economy, with private investors jumping in and buying these houses with the lure of profit created on these foreclosures.  Our new president at the time, Ronald Reagan came in and reduced the interest rates to more manageable rates, and our economy became robust again.

Our problems now dwarf the problems of the saving and loans crisis of the 80s.  The wave of foreclosures are touching every segment of society, the rich, poor, middle class.  The sunami hasn’t even rolled in yet.  If you go to Realty Trac, Foreclosure to go, or any other foreclosure site you will be shocked and amazed at all of the foreclosures coming in.  I know from being in the real estate business and talking to my clients, people plan to let their houses go.  This will create a huge supply of homes on the market, and the values will dip even further.  Not to mention the psychology and despair of losing your home.

I have come up with a solution for our crisis, or at least a few ideas.  And I welcome your response and criticism.  I don’t know how this will come about, but I know it has to come about, for the survival our capitalistic society.  We need money for investment to live.  I say raise the interest rates,  but make money available again.  Not a huge increase, just enough to make the investors want to buy up these loans again.

My 3 initial steps for fixing our economy is:

Number one, we need money in circulation.  Of course, we need money so we can can buy products and services and live, but we need money in circulation for new investments, which is key to a healthy and growing economy.  Money supply, not just printed money, but money backed by government securities.  The government needs to loan the banks money to make available for loans again, and recirculation of the money is crucial.  Raising interest rates will give investors higher yields and interest to invest in these bonds/securities. 

The first bailout, money given to the banks, never made it out into circulation.  The banks used this money to pay off their bills and line the pockets of their investors.  This second bailout has to be for loaning money and putting money back into circulation.

I  don’t think money given directly to our citizens will work.  This will serve to deepen our problems.  This is a quick fix, and ultimately fixes nothing.  We have to get the system working again.

Number 2, a devaluation of current delinquent loans should be made to current market value supported by at least two appraisals.  So if you owe 200,000 on a delinquent loan, and its worth 140,000, a new loan should be made of 140,000.  The difference of 60,000 will be paid by the government to the lender.  This will serve to keep the people in the houses, and to keep them up, and make payments.  We need to do this because of the volume of foreclosures coming in, which will doom our society and economy.   

These loans made should only be made to people who can show an ability to repay. Certain criteria must be set up for these loans.  They must show they had loss of income, or some criteria to stop an all out refinancing of all loans.

Number 3 is job creation.  Jobs should be created by the government such as new work on highways, bridges, and inner core infrastructure of our cities.  However, infrastructure should be a new creative innovative urban design for transportation and public facilties.  Innovative designs using electric transports run by clean power, not fossile fuels should be used.

Also, new business loans should be made to those that show an inclination towards energy savings and innovation.   

So to recap, I think we need to

1. Make money available for loans (money back in circulation). 

2. Number two, have a form of devaluation to keep the people in their houses with renewed interest

3. Job creation.

Incredible.

Here is our new Shuttle

Here another picture