Table On-Topic Summary - 20-Oct-2002

A compilation of this board's financial/economic posts From 43865 to 43895

Post  43865  by  ttalknet2       OT: Camp of the Saints?

Post  43866  by  maniati       Reply

lk: Hah! What did I tell you! :-)

Post  43867  by  lkorrow       Reply

maniati, yep, you were right on. But victory may be premature, it's not over 'til the fat lady sings! Last line, "But the most important decision maker is Alan Greenspan, the chairman of the Federal Reserve Board, and he has been conspicuously silent since the meeting last month."

Post  43868  by  spirare       Reply

The Gem Quality Red, Pink And Green Diamonds Recovered; Exploration - Development... In February, 2002, Caledonia announced the start of drilling of the kimberlite pipe on its Goedgevonden Diamond Prospect, located near Stilfontein in South Africa... While the exploration continues, it is still too early in the program to give definitive results... However, some small gem quality diamonds have been recovered from the first drill hole sample of 1,105 kg processed... RE: Goedgevonden... http://www.caledoniamining.com/mapd3.gif A drill program commenced in March, 2002... Caledonia has an option to acquire 100% of the Goedgevonden diamond bearing kimberlite pipe located approximately 20 kilometres north of the Stilfontein Gold Mine in the Klerksdorp district of the North West Province in South Africa. Prospecting activities in the mid 1970's indicated the pipe is oval in plan and covers a surface area of approximately 27,000 square metres. The pipe which outcrops has been intersected at a depth of 425 metres and further down dip extensions remain undefined. The drilling yielded averages of... 35 to 45 carats/100 tonnes with one hole yielding 65 carats/100 tonnes. A fair portion of the diamonds recovered from the drilling were gem quality with a notable tendency toward pink coloured diamonds. Caledonia conducted a Stratagem survey in December 2001. A drilling program commenced in March 2002. Caledonia has also acquired options over the surrounding area of interest in order to optimize the potential for future exploration based on the Goedgevonden drilling results. Some history; Subsequent to Govenor WA van der Stel naming this beautiful valley "Het Land van Waveren" in 1699, several farms were allocated to immigrants from Europe. In 1875 the railway line from Wellington to the farm Goedgevonden was completed and this point was called Ceres Road Station. This was an important link between the Cape and Kimberley's diamond fields by means of stage coach... From here, proceed to the Kimberley Mine Museum and the Big Hole... Today this is followed by lunch and... The DIGGERS FOUNTAIN http://www.places.co.za/assets/images/kim2.jpg THE DIGGERS HOLE... The Big Hole itself is an astonishing sight. Mined to a depth of 215 metres, and with a surface area of +/-17 hectares and a perimeter of +/- 1,6 km, it is the largest hand-dug excavation in the world. On 14 August 1914 work on the mine was suspended. By that time 22,5 million tons of earth had been excavated, yielding 2 722 kilograms of diamonds. http://www.places.co.za/assets/images/kim10.jpg In the 1870s and 1880s Kimberley, encompassing the mines that produced 95% of the world's diamonds, was home to great wealth and fierce rivalries, most notably that between Rhodes and Barnato, English immigrants who consolidated early 31-foot-square prospects into ever larger holdings and mining companies. In 1888, Rhodes prevailed and merged the holdings of both men into De Beers Consolidated Mines Ltd., a company that is still synonymous with diamonds. Today South Africa is third in production in terms of value and is likely to stay that way for the foreseeable future. The Kimberley mine in 1873... http://www.amnh.org/exhibitions/diamonds/images/kimmine2.jpg Visible are the roadway and the square claims which were 31 feet on a side, creating a terrain of holes and walls that made mining difficult and hazardous. From "The Diamond Mines of South Africa," G.F. Williams, New York, 1906. Barney Barnato arrived in South Africa from England in 1873 at the age of 20. In 1876 he bought four claims in the Kimberley mine. He made a huge profit and later formed the Barnato Diamond Mining Co., which he merged with Kimberley Central Mining Co. in 1883. In competition, Rhodes sold one of his companies to Barnato's Kimberley Central but his retained interests gave Rhodes a 20% share in Kimberley Central. Rhodes and Barnato battled viciously for the remaining stock. In 1889, Barnato sold out to Rhodes for £5,338,650, at that time $25,000,000, paid with the largest check ever issued at that time. In 1896, Barnato disappeared at sea while on passage back to England, a presumed suicide. In 1870, at the age of 17, Cecil John Rhodes followed his brother to South Africa. There he purchased diamond claims and became prosperous pumping water from the deepening, flooded claims in Kimberley. After expansion of his holdings and competition with Barney Barnato, Rhodes went on to form De Beers Consolidated Mines. He became prime minister (some say dictator) of the Cape Colony, and dedicated his final years to the creation of Rhodesia (now Zimbabwe). In 1902 at age 49, Rhodes died a very controversial figure. From "The Diamond Mines of South Africa," G.F. Williams, New York, 1906. South African Production: Total: 505 million carats Annual 1870: 269,000 carats 1903: 3 million carats Today: 8 to 10 million carats *** Goedgevonden: Previous drilling confirmed the kimberlite extends at least 440 metres below surface and remains open at depth. During December 2001, Caledonia completed a geophysical survey of the Goedgevonden pipe. A drill program started in March 2002. The objective of this initial drill program is to determine the economic potential of the top 100 metres of the pipe before committing to a more extensive drilling program. Caledonia has also acquired options over the surrounding areas of interest in order to optimize the potential for future exploration based on the Goedgevonden drilling results. The pipe which outcrops has been intersected at a depth of 425 metres and further down dip extensions remain undefined. The drilling yielded averages of... 35 to 45 carats/100 tonnes with one hole yielding 65 carats/100 tonnes. A fair portion of the diamonds recovered from the drilling were gem quality with a notable tendency toward pink coloured diamonds. * * * SUCCESSFUL MINI-BULK SAMPLE OF GOEDGEVONDEN KIMBERLITE PIPE, AND ADDITIONAL EXPLORATION RIGHTS ACQUIRED OVER THE SYFERFONTEIN KIMBERLITE PIPE AND ADJACENT AREA TORONTO, Jun 12, 2002 (BUSINESS WIRE) -- Caledonia Mining Corporation ("Caledonia") of Toronto (TSX:CAL) (NASDAQ - OTCBB:CALVF) is pleased to report that it has completed a mini-bulk sampling program on its Goedgevonden kimberlite pipe in the Klerksdorp area of South Africa and that it has also acquired the exploration rights over the nearby Syferfontein kimberlite pipe and other adjacent areas of interest. Goedgevonden Mini-bulk Sampling Program A mini-bulk sample was collected from seven RC holes drilled on the Goedgevonden kimberlite pipe. Three holes were drilled to 150m, and one hole to 120m, in the centre of the kimberlite and the remaining three holes were drilled to delineate the pipe in more detail. All holes entered kimberlite at approximately 6 metres and the four deep holes above were stopped while still in kimberlite. A total of 56 tonnes was collected and processed by a Van Eck and Lurie dense media separation ("DMS") plant. The Goedgevonden pipe was confirmed to be diamondiferous and sufficient gem quality diamonds, including a number of pink stones, were recovered to warrant a subsequent 8,000 to 10,000 tonne bulk sampling program which will commence in the third quarter 2002. Based on results of this second program a more extensive bulk sample would be required before production decision could be made. Syferfontein Kimberlite Caledonia has acquired the exploration rights over the Syferfontein kimberlite pipe on the farm Syferfontein 376IP, approximately 1km NE of the Goedgevonden pipe. Exploration reports of work conducted by others over the Syferfontein kimberlite in 1997 confirm that it is * * * diamondiferous * * * and recommend a mini-bulk sampling program to evaluate the grade in the upper levels of the pipe. Caledonia plans to initiate this program in the third quarter. Future exploration programs would be based on the results of this sample. Caledonia also plans to drill two other pipe-like targets which they have identified within their exploration area. The diamond counts will be very interesting... Gem Quality Of RED and GREEN DIAMONDS - The Rarest Diamonds In The Earth - http://media.richmondclub.com/luncheon/Caledonia_files/Caled/CaledoniaGIF_files/Slide0040.htm * * * Caledonia is listed on both the Toronto (CAL) and NASDAQ (CALVF), Stock Exchanges. Caledonia has two diamond exploration Joint Ventures with major mining companies in Zambia and Canada. Both programs are fully funded by the JV partners... also some Great Diamond Properties in SA & Canada... owned 100% by Caledonia... Caledonia owns two gold mines in South Africa with a gold resource of about 2.93 million ounces and considerable potential for additional resources. Caledonia has a fully funded Joint Venture with a major mining company exploring for copper-cobalt on the northern extension of the Zambian Copperbelt. Caledonia holds a large land position on the Zambia Copperbelt on which exploration continues. Caledonia continues to provide Management Services to an advanced gold exploration project in Scotland. Caledonia has a strong, experienced management team and subscribes to fiscal discipline... Mar.5, 1999, debt restructuring of CALVF... was concluded & debentures of $20.4 million was converted into 14,593,750 common shares of CALVF... >Caledonia is essentially debt free, no banker can push them off the cliff... well, great to be the Long Shareholder Caledonia is listed on both the Toronto (CAL) and NASDAQ (CALVF) Exchanges. http://www.caledoniamining.com/welcome2.html Current Price of Gold http://www.caledoniamining.com CALVF a great bargain opportunity... Imo! (Voluntary Disclosure: Position- Long; ST Rating- Strong Buy; LT Rating- Strong Buy)

Post  43869  by  lkorrow       Reply

ttalknet2, even scarier is they seem to be open about it. And what do we do . . .

Post  43870  by  lkorrow       Reply

spirare, all that stuff is nice, but what have they done lately. Feb 2002 was 8 months ago!

Post  43871  by  Nasdaq60       Reply

Thanks Spi, I am sure Nick knows, the Roadshow will inform 750,000 investors around the world, it will be very intresting when thing start rolling... FYI Note. This diamond business used to be a family affair. Calvf got this diamond property in a trade from Angloplast, who got part of the rich platinum property from Calvf. AngloPlast had just bought De Beer. Harry is not with us, but Nick is! Harry never let the the red & green out, they were all kept under very strict security. Nick knows! I am still stunned, CALVF got this? It would be no surprise to see Nick, take over CALVF! Its some old powerhouse here, might be stronger than the mm's shortselling? It will be very intresting for sure! - @@ - RE: Be, you promise CALVF to make it a Family party... ***A New Family Affair*** the old was a pretty good one; "A Family Affair," that showed various aspects of... A short note; Harry Oppenheimer's personal life... there were scenes of his arriving in Johannesburg in his own blue and white Gulf Stream jet, followed by his aide-de-camp and security police... other scenes showed him at his palatial home, surrounded by his Goya paintings and greyhound dogs... there were also scenes of Oppenheimer at his stud farm outside of Kimberley with his championship racehorses... a young executive with the Diamond Trading Company in London, told, how he had been invited to... *Oppenheimer's game farm* during weekends in South Africa... he recalled that Harry Oppenheimer would sit in his shirt sleeves on the terrace surrounded by various members of his family, executives of Anglo American and De Beers and a few friends... everyone would drink beer... when an elephant or a rhinoceros would trudge up to the barrier in front of the terrace, a servant would throw a floodlight on it, and everyone would admire the wildlife... the section about Oppenheimer's *plan to jettison several tons of diamonds into the North Sea* comes from documents, obtained under the Freedom of Information Act, which pertained to the United States government's antitrust suit against De Beers... this historical research was supplemented with interviews with a number of officials at De Beers, including Harry Oppenheimer... did CALVF get Oppenheimer's gamefarm, *was it capped to not flood the market*... the diamond count will be very interesting... Gem Quality Of RED and GREEN DIAMONDS - The Rairest Diamonds In The Earth - http://media.richmondclub.com/luncheon/Caledonia_files/Caled/CaledoniaGIF_files/Slide0040.htm http://www.caledoniamining.com (Voluntary Disclosure: Position- Long; ST Rating- Strong Buy; LT Rating- Strong Buy)

Post  43872  by  spirare       Reply

Green is the only fancy colour that results from causative effects after formation. Sometimes during their growth, a few diamonds come inyo contact with strongly radioactive materials such as uranium, which creates radiation defects in the lattice of the diamond. The penetration is usually not very deep, resulting in a superficial green color. Dependent on the time of exposure it may occur in patches on the surface or a continuous skin. These, along with red and pink diamonds, are the most valuable. Colour Enhancement by Irradition Fancy Coloured Diamonds are not always "Natural". Their colour may have been modified or enhanced through one or more processes involving irradiation and/or extreme heat. While this enhancement may in fact be permanent, *the occurrence of natural colour in a diamond is far more rare*, and thus more " expensive ". The tests for identification of "origin of colour" are usually conclusive, but may require sophisticated equipment and highly qualified testers. http://media.richmondclub.com/luncheon/Caledonia_files/Caled/CaledoniaGIF_files/Slide0040.htm http://www.aussiegems.com/colour.html http://www.caledoniaming.com ;-) (Voluntary Disclosure: Position- Long; ST Rating- Strong Buy; LT Rating- Strong Buy)

Post  43873  by  spirare       Reply

It has been estimated that only one out every 10,000 natural diamonds is a fancy colour. Among natural coloured diamonds the rarest shades are red, pink and green. More common are various shades of yellow and brown. The rarest and most valuable colored diamonds are vibrant reds. One of the highest per-carat prices ever paid for a diamond was for a purplish red stone weighing around 0.95 carats. Sold at auction in 1987, this amazing piece brought an astounding $926,000 per carat. http://www.aussiegems.com/colour.html Note. the CALVF diamonds you see on the picture are from drillcores which is normally about 2 inch diameter - the inside opening. So most of the pieces are probably fractured from larger stones *"like brilliant golfballs", sounds good* keep the fingers crossed guys! http://media.richmondclub.com/luncheon/Caledonia_files/Caled/CaledoniaGIF_files/Slide0040.htm (Voluntary Disclosure: Position- Long; ST Rating- Strong Buy; LT Rating- Strong Buy)

Post  43874  by  ttalknet2       OT lk: What we should do is defend.

Post  43875  by  clo       Reply

lkorrow & manaiti, if the Fed thinks wars is imminent, would'nt they save any future cuts to balance the rise in oil costs? Mr. G is not one for showing his cards prematurly, but they can't afford to waste any cuts at this point, IMO. The future is more uncertain now after North Korea has opened up a new can of worms... I wonder if this will tie the hands of the administration with attacking Iraq? The talking heads this morning might prove interesting? clo

Post  43876  by  maniati       Reply

clo & lk: Yes, lk, you're right. I was gloating a little because the article did show that I had correctly guessed their sentiment, but I have also said all along that unexpected news could develop that would cause them to change their minds. So, if the meeting were held tomorrow, there would be no rate cut. But, certainly something unexpected could happen between now and Nov 6. Clo, the Fed would hold off anyway, even if there were no Iraq issue. They won't cut again unless things get clearly and unexpectedly worse - that's my contention. So, take Iraq out of the equation, and they would still be waiting to see unexpected weakness before doing anything. Also, monetary policy is virtually powerless against the kind of inflation that would be created by an increase in oil prices. All inflation is not the same. Contracting the money supply and raising rates is only effective against certain kinds of inflation, and an oil price rise is not one of them. The only long-term solution to a permanent increase in oil prices (other than undoing the increase by invading Saudi Arabia) is a reduction in the demand for oil and/or the development of alternative sources of energy. And that's it.

Post  43877  by  Decomposed       OT: Table ON TOPIC SUMMARY Oct 19, 2002

Post  43878  by  maniati       OT: clo: BTW, you have shown remarkable restraint

Post  43879  by  pmcw       Reply

Three weeks ago (on October 1st), I was 90% sure we would see a quarter percent cut in November. However, after hearing several conference calls and reading countless Q3 reports, my bias is moving towards 50/50. As is often the case, I think Greenspan has multiple missions on his mind. Back in the late 1990's I think he enjoyed the advantage of no one knowing for sure what direction he might take next. This is as opposed to most of the last 22 months (save the last two meetings) when his hand was as obvious as if he was playing his cards face up. I feel there is power (not only for him but to the benefit of the economy) in situations where his word about economic progress and his reactions are able to set the tone versus when they just follow the tone. If you remember back to the days of 1999, you'll recall times when the market would take a noticeable swoon during the days leading to a FOMC meeting. It was almost saying "hey Al, give us the cut". I doubt this clearly artificial movement had any influence at all over almighty Al, but I think the market went through the exercise almost out of superstition. Since the next meeting follows the elections it is already at a very interesting inflection point. Will we have a terrorist attack on 11/5? Will we have a conclusive election? Will everyone become pessimistic as the election approaches and campaigns get nastier than they are today? Will Wall Street abandon the market as the elections and FOMC meeting approach; begging big Al for the cut? Or, will the bull rally materialize? Will campaigns turn to the issues in an attempt to not turn off voters? Will Gephardt become a Republicrat and push for some real stimulus packages and tax cuts? Will the economy show some evidence of a strong Q1 again, as it did in late 2001? One way we get a cut and the other way we get confidence. Either way, once it is clear we have a conclusive election and absent a major geo-political event, I see a good November. I believe this will be supported by both the typical "feel good" that follows a conclusive election and the growing prospects of another strong Q1. In the case we do see a good November market I feel it will become choppy towards Thanksgiving and of course, into the final tax juggling month of December. Depending on the economic outlook at the time, late November and the first three weeks of December may offer some wonderful buying opportunities as people make tax driven decisions. If Bush gets his way and increases the amount people can write off against income (after they zero out all their losses), tax selling season could be real interesting. It probably won't take the broad market to new lows, but I think some stocks could re-test their old bottoms. Bottom Line: This holiday shopping season will bring us values in both the stores and on Wall Street. However, as is always the case, there will be both junk and gems to tempt the buyer. Regards, pmcw

Post  43880  by  Arkural       Reply

Democracy Needs Well Stocked Minds (transcription) by Llewellyn King Washington-The coming war with Iraq-and the in Washington is not of whether, but when-has overshadowed other issues in the midterm elections. But that does not mean that voters are now unconcerned with prescription drug benefits, Social Security and, of course, education. Education has become a hardy perennial of our politics; yet it seems no closer to a fix than it was last year or the year before or, come to that, in 1948. Sloan Wilson, the novelist best-known for “The Man in the Gray Flannel Suit”, was hired in the late ‘40’s by Henry Luce, the publisher of Time magazine, to go around the country proselytizing the need to fix the education program. After several years of this, Wilson gave up, saying in his autobiography that after hundreds of speeches and tens of thousands of miles, he realized ha had no impact on education and was wasting his time and Luce’s money. Wilson’s account is interesting because he points to a breakdown in schools much earlier than most parents now believe it occurred, and the futility of talking about education. Yet talk about it people do. S. David Freeman, a big player in California’s energy crisis and a distinguished energy expert, told me years ago that he would never make another speech without referring to education, and he kept his word. Yet speeches about education do not seem to have any impact, and the sense that we are failing to educate our children is pervasive. Many universities are now little more than remedial high schools. Professors have told me that they have to teach simple English and math before they can tackle the coursework. That is the crisis. But it is not peculiarly an American crisis. Schools in Europe are also failing, and although we tend to think of the British as being superbly educated, as with the United States, only the top percentile keep up the great tradition of learning. What is particularly revealing about Wilson’s foray into fixing education in the 1940’s is that it was a time when television had very little penetration and electronic games and the Internet had yet to be invented. Today television is commonly blamed, as the Internet. The problem has its genesis elsewhere. Before fixing education, we need to know what it is we have in mind as an educated person. Is it, as is sought by industry, an automation in science and math who can take a useful place in the work force? Or is it, instead, someone with a well stocked mind who can use education to help himself or herself through life? I lean toward the latter. My father was not a lettered man. He could read and write, but only with difficulty, and he confined his reading to his Bible. At one stage in his life, he was living in Botswana, palpably lonely, and he would sit under a tree for many hours drinking tea and thinking. When I would visit him, this would so bother me that I urged him to read. His response was, “But I would only get other people’s second-hand ideas.” I had no recourse. When I returned to Washington, a fellow journalist said, in an unrelated way one day, “Thank God I can read. When things are really awful, I have the luxury of going to bed with a good book, to find out that these things don’t only happen to me.” Alas, I was not quick enough to explain to my father that reading would have given him a connection to all mankind and its pilgrimage. Education, in my scheme of things, is about inner resources, defense against the world and a connection to that world. It is also about the excitement of finding out and the fun of knowing. Were our education system to focus more on these things-once thought as a classic liberal education-it would seem to me we’d have the raw material to turn out as many scientists and engineers as we needed. If we are to fix education, we have to kindle curiosity, nourish young minds and instill a sense of excitement about just about everything. Nothing I have heard in the current education debate about examination standards, curricula and the like suggests that the marvelous adventure of learning is being inculcated into the young. What, then, is the purpose of producing generations of students useful to the work force and of little use to themselves? Democracy needs well-stocked minds. When did we lose sight of that? And how, without it, can we really discuss Iraq or anything else? {essay distributed by Knight Ridder/Tribune News Service- KingPublishing.com)

Post  43881  by  Decomposed       ot: maniati,

Post  43882  by  Arkural       Reply

correction-should of read, the talk in Washington...

Post  43883  by  nacl01       OT: lkorrow, VSE

Post  43884  by  maniati       OT: ttalknet: I'm not sure what this means:

Post  43885  by  Decomposed       ot: Apparent new sniper attack

Post  43886  by  maniati       OT: Decomposed: Let's compromise: I completely and

Post  43887  by  maniati       OT: Well, I guess it's time to put the stick-figur

Post  43888  by  oldCADuser       OT: Man, I read your comments about the sniper bei

Post  43889  by  Decomposed       ot: maniati, Clinton

Post  43890  by  clo       Reply

Oh maniati! "Let's start a revolution clo, baby. You and me. :-)" You've got it kiddo! You noticed that I said the R's feed into the D's hands with this SEC nonsense... I can't believe they can shoot themselves in the foot like they do! I thought just us D's were into that dumb stuff lately. I've moaned and groaned about the Saudi's and our inability to hold their feet to the fire. They are much easier prey for us. After all they will need to hire people to fight their war as they have been too lazy for too long! But we are beholding to them for their oil... Oh, and we better learn from their lazy behavior. We can't afford to get soft! Oh and if the R's avoided the BJ crap, they would have had a much stronger leg to stand on with the rest of their gripes about missle errors with China. But no they went for the cheap shot thinking that would do him in... WRONG! I don't blame GWB for the start of the recession, I do hold him responsible for his lack luster economic team! Please, loyality is one thing among friends, but when you are managing a country you need to cut the fluff! And Paul O'Neill needs to go along with Harvey Pitt and Powell's son. I see Homeland security as his next problem. With this sniper on the loose, if we can't get him, how do you make a case for the money to be spent on the "bigger picture?" The reason Florida is difficult to let go of is because the voting issue still lurks. Reform is slow in coming. By the way, for the record I felt very sad for Jeb Bush & his daughter. To put her in jail for 10 days is terrible. Oh I know it's the law. Maybe now those in power will see how inappropiate that is? Joe Lieberman on CNBC the other day suggested a moratorium on sales tax for a period of time. This to help the "consumer" continue to prop up our economy, and to help the consumer during the holiday season. Not a bad idea... Like interest free autos ;)) Did you see Colin Powell in NYC the other night as a stand up comic? He was terrific! So maniati, let's give em hell, at least we can try! We can be the Mary Matlin & James Carville, in reverse!;)) clo

Post  43891  by  maniati       OT: OCU: "I would think that if it was being

Post  43892  by  Decomposed       ot: clo, jeb's daughter

Post  43893  by  jeffbas       Reply

"To put her [Ms. Bush] in jail for 10 days is terrible." I disagree. I have been there with a close family member. Although NOTHING is likely to work with a SERIOUS drug addict, we thought this was a good wakeup call in our own situation. In fact, the only case I am personally aware of a total success involved a decent spell of prison time, and even that case had long term health consequences. The most recent situation I know of was a friend of my teenager, who recently took his own life. Ms. Bush is not in a "poor dear" situation, and Jeb Bush is going through hell. (By the way, I would execute convicted drug dealers - who are literally selling death.)

Post  43894  by  oldCADuser       OT: Man, I'm still in India (I leave for Korea Tue

Post  43895  by  srudek       Reply

California's new RE sales tax withholding-- A friend alerted me that a significant change in investment real estate tax had just been snuck through into law (I never heard of this coming, did anyone?). My fear was that it was going to be a new, automatic tax on investment sales. At first it "seems" to not be so bad -- merely compulsory withholding. But when you look closer it gets uglier; this isn't withholding on profits, for example, but on sales price. Sell your $3,000,000 apartment building on Jan 1 and CA will require you "loan" it $115,000, interest free, for at least a full year--even if you didn't make any money. So, in the latter case, I guess you have to borrow the $115,000 on credit cards or something so you can loan it to the state. This could become quite significant when the real estate market breaks -- as it almost certainly will in California -- as it will keep more than a few people from being able to sell property before they are forced into foreclosure. More importantly, it is indicative of trends in California and, I suspect, in many other states. California is getting desperate for money -- but never, never, never desperate enough to lay off employees or otherwise cut spending on pork. Meanwhile, California is imposing ever more restrictive and oppressive laws against landlords. Last January we got a law which required landlords in Santa Monica and some part of L.A. to give a reason in writing for any 30 day notice to move (except they're changing that to 60 days). They wanted to do this statewide immediately but couldn't sneak it fast enough and decided, instead, to introduce it on a limited basis and then roll it out for the rest of the state. What's wrong with this law? Well, let me tell you: when you've got a drug dealer in a house you can seldom PROVE it and a "3 day perform or quit" for some violation of the rental agreement (e.g., "too much noise and traffic") is generally unenforceable unless you can get a police witness. So a 30 day notice -- with no explanation -- is generally the only tool you have. California: the best friend a drug dealer could ever have. Government grows like cancer; how much cancer is enough? Enough intro; here's the link and some excepts: ------------------- http://www.bayarea.com/mld/mercurynews/business/4275263.htm Posted on Sun, Oct. 13, 2002 Mark Schwanhausser: State's new real estate law mugs taxpayers By Mark Schwanhausser Mercury News . . . . Starting Jan. 1, [California] will require that 3 1/3 percent of the entire sales price -- not just the gain -- be withheld on the sale of most vacation homes and investment properties. That means that if you sell a $500,000 rental unit, the state will demand $16,650 in withholding -- even if you make only $1 in gain. Here's another way to look at it: To owe $16,650 in tax, you would need to pocket a gain from the sale of nearly $180,000. Real estate agents, escrow companies and tax preparers are crying foul. The California Association of Realtors and Spidell's California Taxletter are negotiating with the Franchise Tax Board to find wiggle room in the law. Currently, the FTB routinely grants waivers to non-resident sellers who can prove the withholding will exceed their ultimate gains. But the FTB says the new law bars it from extending the same courtesy to residents. . . . Critics fear the tax change could have wide repercussions. Sellers who are thin on equity will be forced to dig into their pockets to pay the withholding. If they can't, some sales will fall through, triggering lawsuits. Other sellers will sidestep the withholding by retitling their property into, say, a partnership that is exempt from withholding. Others will manipulate their estimated tax payments to pare their refunds. There are some notable exceptions to the new rule, which was inserted quietly in the omnibus budget bill (AB 2065) approved on the last day of the legislative session. The withholding will not be required, for instance, if it's your principal residence, if you sell at a loss, if it's part of a real estate exchange, or if the sale is less than $100,000. (In Silicon Valley? Get real.) Despite those exemptions, the FTB estimates the change will affect 300,000 transactions worth at least $6.8 billion in sales. More important, it will raise $225 million to help keep the state running. . . .