Obama to Restrict Bank CEO Compensation

Real Estate News & Commentary by Chris McLaughlin, February 4, 2009
http://www.shortsalesriches.com/welcome.html

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Yesterday’s webinar was a hit! We were flooded
with hundreds of questions during … and even
more afterwards.

So we negotiated with our webinar host, and came
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replay.

Here’s a chance to go over anything you may have
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The outrage over extravagant spending on St. Regis parties by AIG and new corporate jet orders from Citigroup has now taken its toll on these poor, poor CEOs: if they get any more bailout funds, their compensation may be limited to $500,000, according to statements made by President Obama today. This could be a real downer folks. I mean really, when they are at 30,000 feet in the new corporate jet, they aren’t going to have enough money to pop a few bottles of Dom anymore. Any the party at the St. Regis – they might now have to cut out the daily massages and keep them to just 1 a weekend. We’ll see.

But is this just government run banks? Yeah, if you ask me the banking industry as we know it is over for the next few years until the market participants want to come back in from the cold. This is a total loss of confidence in our financial system; it won’t just come back overnight. Economic recovery takes leadership…and so far these banks haven’t exhibited much leadership.

Sure, there is concern that with the restrictions of compensation, the ability to adequately compensate top performers will be hindered, and all the good talent will leave. You know, all that good talent that decided to leverage Lehman Brothers 40 to 1 on mortgage backed securities that went south. That great talent that decided to pay billions in bonuses after receiving billions from the government. I still can’t see why any American would be outraged …hmm..

And as these executives get less in pay, we’re reminded that there are a lot of people that just don’t have any pay. ADP Employer services reported that private employers eliminated 522,000 jobs in January versus 659,000 in December – that’s over 1 million jobs lost in just two months. In other job related news, the unemployment rate rose in 98% of all metropolitan areas of the country – 363 of 369 metropolitan areas rose in December 2008. El Centro, California had the highest unemployment rate in the country – a stunning 22.6%, but Morgantown, West Virginia had the lowest – just 2.7%. In the metro areas, Detroit had the highest rate of 10.6% and San Bernadino, CA came in second with 10.1%.

Now, on to our real estate investing section…

Negotiation 101

In college one of the most popular courses among those entering politics, business or even psychology is negotiation. With good reason since the ability to successfully negotiation is a skill that makes or breaks men and women of all levels of intellect, skill and background. Without strong negotiation skills the best and brightest are likely to find themselves working behind the scenes rather than taking the bull by the horns and forging ahead. Real estate is one area particularly well suited to strong negotiation strategy and fortunately, you don’t need to spend thousands of dollars or countless classroom hours to acquire this art form. Instead, start small with these simple tips:

Stay on-point. Speak clearly, slowly and remain calm at all times. Think of negotiation like a poker game; practice to find out your individual “tells” then eliminate them from the table.
Clearly define the deliverable. It is important to establish who “owns” what and how each party will benefit from the other persons contributions.
Be the FIRST person to give up something. This might sound counter-intuitive but research has confirmed how well it works. By taking a lead role in “giving up” something first, you create an obligation for the other party to reciprocate. Make sure what you give up is meaningful but with the full intent of acquiring something even more meaningful in return.
Use the other person’s name and maintain eye contact if you happen to be doing this in person (most short sale negotiating takes place over the phone, of course).
Don’t be afraid to use silence strategically. When the other party makes an offer or counter-offer consider it slowly and silently; don’t speak for several seconds even if it is everything you hoped for and more. You never know what their bottom line may be so wait a few seconds to see if they respond further.
Once you have a tentative agreement on the table, take time to outline the specifics including time, price, limitations or exclusions. Once again, remain calm and offer something in advance to create an obligation or reciprocation on the part of the other party.
Put it into writing then and there. Anyone who has ever bought a car knows the tactic; make them sign something even if it isn’t legally binding. The very act of acknowledging the agreement makes them take ownership and creates a strong motivation for follow-up.
Act Fast. Move from the talking stage to the doing and delivery portion of the transaction as soon as possible. When dealing with short sales and real estate in general it isn’t unusual to encounter cold-feet, second guessing or other attractive offers.

See you at the top!

Chris McLaughlin

http://www.shortsalesriches.com/welcome.html

P.S.

We’re holding a LIVE webinar this coming Saturday at 3 PM EST, 12:00 PM PST…all on the strategies of recession proof real estate investing. Go here now to make sure you reserve your spot, last time they filled up quickly!

https://www2.gotomeeting.com/register/583681653

Don’t miss the replay, only available for the next 24 hours:

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About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month

   * Long-time authority on real estate investing
      and rapid flipping of distressed homes. Owns
      portfolio of nearly 100 high-value, high-profit
     properties

    * Owner and Supervising Broker of one of Florida’s
     largest Real Estate firms, running 4 different
     offices, supporting nearly 450 agents, uniquely
     positioning him to help thousands of investors
     make money in the biggest market opportunity ever!

     * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
     in Real Estate Investing, Entrepreneurship, and
      Wealth Building

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