Formerly Hot Venice Real Estate Goes Cold

FORMERLYHOT…and other thoughts. By Eric Ahlberg and the royal we.
Oh Blessed Gaia, thank you for delivering me into another year, another cyle of our breath together. There have been signs that we may not last much longer. They are foolish illusions to disempower us. The creative and destructive powers of humanity are huge and can bend toward justice.

This should be a glorious year, with the Republicans and Fox News calling for World War Three to thunderous applause. Why must they pursue their ultimate dickishness? Is life an action TV serial, where it’s our thugs vs their thugs, with 3 underlying layers of behind the scenes string pulling, and double agenting, until the bombs go off? This would be such a dark day, but since I have saved humanity in Fallout 4, at least now have the skills to rebuild in a whole new desperate wasteland of thieves and warlords.

As nearly every fantasy consumer and gamer knows, money is the ultimate superpower. It gets you the upgrades and buffs. It lets you employ your own thugs, be they lawyers or security agents. We may hope to glory in an awesome spectacle of Armageddon from a mountaintop, but it’s lately that is becoming movie and gamer kitsch.

At my family holiday gathering, the 15 to 25 year olds were completely obsessed with computer gaming, to the point of ignoring adults, avoiding chores, and being unsociable while the girlfriend helped in the kitchen. No longer watching the game on TV, they play the game on their console. FIFA soccer. I told them 40 FIFA execs were recently charged in ongoing corruption investigations, over 24 nations. Why do I have to be the buzzkill?

Still the Fed has basically kept the ruling elite afloat. The financialization of the Real Estate Market leading up to 2008 led to a 30% fall in property values and subsequent black holes in international finance. So the Federal Reserve Board, a board of private banks, offered to buy up all the troubled assets. Financialization is a superpower in the world, but it is in itself, a fiction, no one handles much money anymore, except at the pot store. Most use debit or credit cards, and shop online with only credit numbers.

Financialization has a problem, there is too much money in the world. In essence an economy involves workers sculpting food and tools from the bountiful gifts of the earth, and then trading them, for wage and contract. But land value inflation does not produce anything new, it claims new value based mostly on manipulation. Much of the near 0% loans that the Fed creates are being used in Real Estate Deals, which don’t really produce value, they fake it with inflation. According to Ben Bernanke, expansion of the Fed balance sheet means the Fed is electronically creating money, necessary “…because our economy is very weak and inflation is very low. When the economy begins to recover, that will be the time that we need to unwind those programs, raise interest rates, reduce the money supply, and make sure that we have a recovery that does not involve inflation.”

This is the big matrix of the entitlement system called the economy. It’s easy to see that it can be rearranged at will. That would be a superpower wouldn’t it? Suppose all money belonged to the people. Some online transactions take place and transfer all the surplus wealth back to the exploited. The Fed has done this for the banks, given them back their wealth, with Fiat Money. – WIKI

Locally, we find LA-wide development trusts like Rockport Development, and developers like Yossi Attia attached to mansionization developments. Global Real Estate Development Trusts look for opportunity, and Venice was a hot market to invest in shake and bake monster mansions. However, the market in Venice has turned “Cold” – Zillow. Since October 2011, home values in Venice have gone up 74% ( Last Year saw Venice home prices rise 9.1%, but over the next year, Zillow is predicting a 3% rise. Venice is overpriced, the market is cold. The GQ article may have been good for selling ghost mansions to the uber-wealthy, but their accountants may tell them to back off, and this ain’t no Newport Beach, Venice is funky. I see that 230 Horizon, an 835 sqft bungalow, 4th block from the beach, and where I first lived when I moved to Venice in 1970, is selling for 1.3 Million. We rented this for $115/mo in 1970.

During the last 31 months, rents in Venice have gone up $49.1%, from $3415(March 2013) to $5094(October 2015) There are several areas in LA where rents are falling. Pacific Palisades fell 7.2% and Bel Air dropped 11.5%. It is perhaps Venice’s biggest attraction which causes it’s biggest drawbacks, bad parking, traffic, tourists, unruly crowds.

People with money, Venice Artists just love them and hate them, they are, after all, the patrons. By fashioning Functional Art for restaurants and boutiques, some artists earn their dinero, while others float on their trust funds as Slacker Abstract Expressionist Surfers. As adbusters put it “Cool = Death”.  Recently evicted 35 year tenant community artist William Attaway quoted on, “When I did the mosaic at the Venice boardwalk,” he says, “I had old ladies coming up to me saying, ‘You rich artists, you’re ruining our boardwalk.’ I started gentrification. You want to blame anyone? Use my name, William Attaway. I will accept the blame.”

In the last year Venice saw three killings of citizens due to trigger happy policing. I am hearing from a Venice Attorney that a lawsuit over the death of Brendon Glenn is being prepared. There has been more harassment of Black people in Oakwood, under a 15 year old “Gang Injunction” = permanent police state harassment.

The Short Term Rentals businesses like AIRBNB are also moves by finance capital, disrupting rent stabilization, and forcing more value out of the housing stock. In Venice we count 2877 short term rentals, and 232 “Entire Rent Stabilized Apartment Units Converted.” Every week is a new horror story about loud inconsiderate partying, porn shoots, and even shootouts at short term rentals. Sure friends of our make extra cash renting out their rooms, but it is the large rental service firms like AIRBNB who make the big bucks off of their stock valuations, and fast growth disruptive global vampire sharking, at the expense of renters.

We are still distressed over the victims of the commercial real estate market. Here the situation is the same, while the business struggles to get customers and build up a cash flow, the landlord has a right to appropriate larger and larger portions of that over the years, without adding commensurate value. This is a market run by thieves. We have lost Zingara, Hals, Casa Linda, the Vaccum Store, Brick House, Just Tantau, Local 25, China Beach, Benny’s, DNA, Fiesta Brava, Robin’s Sculpture Garden, Half of the Art Block studios on Sunset, Surf Cowboys, A+R furniture shop, AXE, Ten Women Gallery,  Glencrest BBQ, Plantation, Circuit Works, The Rose Cafe, The Venice Love Shack is closing, and auto mechanics. I see boutique stores invading Lincoln Boulevard, and gentrifiers stepping over the homeless out there.  The Witzend Property, which sold for $2.7M, is estimated by Zillow to be worth $1.2M

The Republicans have been photo-bombed by Mr. Trump. Here the cosmic irony of language provides us with a zen moment, where the entire Republican Presidential Field endorses Armageddon. The Republican players, Sheldon Adelson (gambling), Roger Ailes (Fox News), the Koch brothers, these form a holy trinity of hubris, gambling, and lies. You’ve played the game, armageddon or peace, destroy the other side or synthesize with them. Sheldon Adelson is the 9th wealthiest person on earth, from gambling and hotels, and his most important political interest is the safety of Israel, and he uses a nuclear strike metaphor to illustrate that actions speak louder than words. Commercial Gambling is theft, but the promise of the thrill of winning at life, the ultimate game of chance, as if someday they will be really lucky and their miserable fate will be redeemed, this is what feeds his gambling empire, a carefully nutured false hope, flashing bling,and lost wages. Then there’s Roger Ailes, perhaps better know as the developer of Bullshit Mountain, as John Stewart labeled Fox News. “This is their big play, running Trump up, with all the explicit racism and patriotic blustering that he and all the other no-military-service warmongering Republican candidates can muster. Trump truly is a core Republican and represents the reactionary values they cultivate, agree with us or we send in the thugs. This is a Brechtian moment, when the gangster clowns begin their rule, or at least, they attempt to rule. Ushering in a nuclear attack on his first day in office? Fear baby fear.

The main stream media gives Trump’s racism and bluster 23 times as much coverage as Bernie Sanders.

Thanks for reading, I leave you with this existential dilemma, paraphrased from Ursula Le Guin.

It is better to light a candle than curse the darkness, but when you light a candle you also cast a shadow.