SAFE AS HOUSES?

In the past few months, it’s been almost all bad news for the housing market. Homebuilders have had to tell Wall Street that between twenty and thirty per cent of their contracts have been cancelled. Janet Yellen, the head of the Federal Reserve Bank of San Francisco, has said that streets full of unsold new homes now make parts of Phoenix and Las Vegas look like “ghost towns.” Selling a home takes longer than it used to, and the inventory of existing homes for sale has gone up almost forty per cent in the past year. Yet, through it all, one fact has continued to provide solace to anxious homeowners and real-estate brokers alike: housing prices have stayed remarkably stable.

The lesson we’re supposed to take from this is that a home remains as solid and safe an investment as ever. After all, we’re constantly told, you have to go back to the Great Depression to find a full year in which housing prices fell. Unfortunately, the numbers upon which these comforting conclusions depend—namely, median home prices for the country—are unreliable and misleading.

There are plenty of statistics available about the housing market, but median home prices, which are tracked by both the National Association of Realtors and the Census Bureau, are what typically make headlines. They seem to tell buyers and sellers exactly what they want to know: how much the one has to spend, how much the other stands to make. The N.A.R. says that median sale prices for existing homes have risen fifty-seven per cent since 2000, and in many markets the increase has been much bigger than that.

Although these numbers come from an association that has a vested interest in making the housing market look healthy, they do provide a roughly accurate picture of how housing prices have behaved in the past six years. But if you’re trying to figure out what kind of investment housing is—what rewards you can expect and what risks you’ll run—median prices become a lot less useful. In the first place, the data don’t adjust for improvements in quality. People have been building bigger homes—the typical new home is about twenty-five per cent bigger than it was twenty years ago—and putting money into improvements like central air-conditioning, home theatres, and pools. And the impact of quality adjustments isn’t trivial; a study of home prices between 1977 and 2003 found that adjusting for quality reduced the return to homeowners by forty per cent.

As for the much vaunted statistic about housing prices never falling for a full year since the Depression? That’s true only if you forget about inflation. When you adjust for it, you find long stretches when housing prices tumbled and then stayed low for years; nationally, real home prices were actually eight per cent lower in 1991 than they were in 1979. What makes the problem worse is that sellers have recently been offering buyers huge incentives, ranging from granite counters to free cars and, in some cases, large rebates. These are, in fact, price cuts, but they never make it into the data.

Then, there’s the problem of sample bias. When you hear that housing prices in a city have gone up, you assume that all the homes in the city have become more valuable. But the numbers reflect only the homes that were actually sold in a given month, and, if more of those homes happen to be expensive, it’ll make the market as a whole look strong even if it’s really quite weak. This is what leads to the curious phenomenon of median prices rising even as the number of sales is plummeting and the backlog of houses on the market is soaring.

Because nominal median prices compare completely different groups of homes (all those sold in August, 2005, say, and all those sold in August, 2006), they can overstate how much prices go up during booms and understate how much they go down during busts. Luckily, there are other measures we can use. For example, the government compiles one index that tracks the repeat sales of homes that have mortgages with Fannie Mae and Freddie Mac, and another index that measures new-home sales while controlling for quality. The economist Robert Shiller, meanwhile, has created an index that controls for quality by tracking repeated sales of the same houses over more than a century. Together, these numbers give us a better picture of what happens to housing prices over time. And though they show that housing prices have risen sharply in the past decade, they also show that, over the longer haul, investing in a home is far from a sure thing; if you control for inflation and quality, Shiller found, real home prices barely budged between the eighteen-nineties and the nineteen-nineties. The idea that housing prices have nowhere to go but up is, in other words, a statistical illusion.

It’s an illusion, though, that has powerful effects. Clearly, it encouraged the speculative buying of the past few years. And it has also made sellers remarkably hesitant to cut prices, which has led to the huge backlog of unsold properties. Eventually, sellers are bound to realign their expectations with reality by trimming their asking prices. That will hurt people who were fooled into reckless speculation by assurances that investing in houses offered risk-free rewards. For most people, however, a decline in prices needn’t be so painful. If you’re planning to sell your home and buy another one, an over-all decline in housing prices leaves you no poorer than before. And, if you’re staying in your home, a drop in value can actually make things easier by lowering property taxes and insurance costs. Look at the bright side: at least you’ve got a roof over your head.

WHAT TO DO WHEN YOU PUT AN ELBOW THROUGH YOUR PAINTING

Casino mogul Steve Wynn ripped a hole through his $139 million Picasso painting while gesticulating at a cocktail party, reports the New York Post. Nora Ephron gave her own first-person account of the damage: It was "a black hole the size of a silver dollar … with two three-inch long rips coming off it in either direction." Wynn had just agreed to sell the painting; now, the deal is off. Is there any way to fix the ripped Picasso?

Yes, but it will be slow and tedious work. The torn ends of the canvas can probably be lined up, and conservators can identify matching fibers on either side of the rip by inspecting them under a microscope. In general, you can expect the wefts in the fabric—that is, the crosswise yarns of the weave—to split at the site of the impact. The lengthwise warps tend to get stretched out, but they may not break.

The rip itself can be mended in a few different ways. First, the conservator can line up the torn ends and affix them to a new piece of fabric that lines the back of the painting. She might also try to attach the torn ends to each other using a method called Rissverklebung, in which individual fibers are rewoven back into place.

To reweave the warps and wefts, you have to figure out the proper placement of each individual fiber. Bits of paint that are stuck to the fibers must be glued in place or removed until the reweaving is complete. (Conservators map out the location of each paint flake they remove so it can be replaced in precisely the right spot.) Because an accident will stretch out some fibers and fray others, you sometimes have to tie off and shorten some threads while attaching new material to lengthen others. Threads attached to the back of the canvas will reinforce the seam.

Closing the tear is only the first part of the process. An accident like Wynn's can damage the painting in other places by stretching the fabric and distorting the image. To correct for these planar distortions, the conservators try to change the lengths of individual fibers or small patches of the canvas. Applied humidity can make a fiber expand across its diameter and shrink across its length—and tighten up distended parts of the weave.

Bits of paint that have fallen off the painting must also be replaced. Wynn might have surveyed the scene of the accident and saved any stray bits of paint for the conservators in a petri dish. (Chance are he didn't strip much off the canvas—Ephron says he was wearing a golf shirt, which suggests a bare-elbow blow. An elbow covered with rough fabric would probably have done more damage.) Conservators have to touch up spots of missing paint with fresh material, color-matched to the surrounding area.

One more thing: Conservators always try to make their repairs reversible. That way, you won't cause any permanent damage to the work if you screw up, and someone can always try to improve on your work in the future.

FILM

On the afternoon of February 23, 1945, the Associated Press photographer Joe Rosenthal, standing at the top of Mt. Suribachi, on Iwo Jima, raised his camera hastily and, without looking through the viewfinder, took the most famous picture of the Second World War. United States forces had landed on the island four days earlier. When the invading troops captured the mountain, five marines and a Navy corpsman attached an American flag to a heavy water pipe, then stuck the pipe in the ground and began to push it upright. Snapped at that instant, the photograph is an accidental masterpiece of classical construction, with the diagonal line of the pole supported by the surging, upraised arms of the men and balanced, at the base, by a marine poised at a right angle to it. None of the faces are visible, and the bodies seem bronzed, as if some sculptor with a taste for the monumental and the obvious had shaped insensible flesh into an icon of spiritual and patriotic glory. In a little more than a day, the picture, printed on the front page of just about every major newspaper in the United States, became an emblem of the war effort. There were, however, two aspects of the event that few people at home knew: that another flag had been raised earlier that day, only to be pulled down, as the story goes, when the Secretary of the Navy requested it as a souvenir; and that the battle on Iwo Jima was to go on for a month more, claiming the lives of three of the six men. (In all, almost seven thousand Americans died there.) After the fighting ended, the remaining flag-raisers—John (Doc) Bradley, Rene Gagnon, and Ira Hayes—were called home and paraded around the country as salesmen-heroes in a fourteen-billion-dollar national War Bond tour. Obsessed with their dead friends, these three ordinary men, the central players in Clint Eastwood’s ironic epic, “Flags of Our Fathers,” faced their public role with varying degrees of pride, nausea, and guilt, and then were cast aside when they were no longer of use to the military.

John Bradley was the corpsman on Suribachi, and, after his death, in 1994, his son James, working with the writer Ron Powers, reconstructed the event and its aftermath in a book that became a best-seller in 2000. William Broyles, Jr., and Paul Haggis, adapting the book for the screen, jump back and forth between three narrative lines: a fictionalized James Bradley (Thomas McCarthy) interviewing the survivors and people connected to the event; the battle; and the bally-hoo, in all its marzipan-and-carved-ice excess. “Flags of Our Fathers” is an accomplished, stirring, but, all in all, rather strange movie. It has been framed as a search for the truth, yet there isn’t much hidden material to expose. The flag-raising may have been a repeat performance, but it wasn’t, apparently, staged for the camera. Bradley (Ryan Phillippe), Gagnon (Jesse Bradford), and Hayes (Adam Beach) were embarrassed by the opportunistic congressmen and the excitable girls who fawned over them, and Eastwood returns again and again to the chagrin of being praised for having done nothing special. When the men appear before a roaring crowd in a stadium, or attend a dress-up dinner filled with swells, they are suddenly yanked back in memory to a moment of terror on the island. Their anguish comes off as genuine, yet this was one occasion when the celebrity culture, however manic and tasteless, did some practical good. The movie has a fine, sensitive temper, but it lacks an emotional payoff. As the men fade into obscurity, it turns into an elegy.

The strength of “Flags” lies in its sombre battle scenes, which were shot mostly on a coastal strip of Iceland where the black sand has the same desolate look as Iwo Jima’s mangled turf. Eastwood and the cinematographer Tom Stern drained all the color out of the shots except for thick, red stains of blood. There’s quite a lot of that. In “Saving Private Ryan,” Steven Spielberg told the story of a small unit fighting as a group in the countryside and in a ruined city, but Eastwood captures the isolation of a man standing quietly in the daylight who is suddenly torn up by mortar fire from far away. Death comes arbitrarily, without the phony “moral” distribution of rewards and punishments seen in many old war movies. A soldier just dies—or he doesn’t. Of the three survivors, Ryan Phillippe’s Bradley is the sanest and also the bravest, Adam Beach’s Hayes, a Pima Indian, the most emotional and battle-haunted. In a companion movie that will come out next year, “Letters from Iwo Jima,” Eastwood will tell the story of the struggle from the Japanese point of view. The Americans expected to survive the battle; the Japanese were commanded to die in it. In “Flags,” the mood is one of sober regret; in “Letters,” one imagines, the mood could only be of the most ferocious devotion.



My friend Herbert was rude to his mother last spring, and, some time later, Mt. St. Helens erupted. And three girls I met on the Central Park carrousel were kicked out of school for smoking, and the price of silver dropped by forty thousand rupiah in Indonesia. With these seemingly trivial events from my own life, I illustrate the dramatic principle by which the Mexican-born director Alejandro González Iñárritu makes his movies. Iñárritu, who made “Amores Perros” (2000), is one of the world’s most gifted filmmakers. But I had the same reaction to “Babel” that I had to his most recent movie, “21 Grams” (2003): he creates savagely beautiful and heartbreaking images; he gets fearless performances out of his actors; he edits with the sharpest razor in any computer in Hollywood; and he abuses his audience with a humorless fatalism and a piling up of calamities that borders on the ludicrous.

“Babel” is set in Morocco, Tokyo, Southern California, and northern Mexico, and is made up of three stories held together only by the arbitrary will of the director and his collaborator, the screenwriter Guillermo Arriaga. A Japanese hunter in Morocco, whose wife has committed suicide in Tokyo—devastating their teen-age daughter, who is deaf—leaves his rifle with a Moroccan guide, who sells it to a neighbor, a goatherd in the mountains. This man turns the gun over to his sons—young boys stupid enough to take a potshot at a tourist bus. Sleeping against a window, Cate Blanchett gets plugged through the neck, causing her almost to bleed to death until she is saved by the fervent ministrations of her husband, Brad Pitt, who, among other things, calls their home in San Diego and tells their housekeeper, Adriana Barraza, that she has to stay with their children. She obeys the instruction by carting the kids off with her to Mexico to attend her son’s wedding, only to lose them in the desert on the way home. There are other mishaps and humiliations in this highbrow shaggy-dog-story-cum-travelogue that I will not trouble you with. No one is evil—the movie is not melodrama—and much of the physical action is decisively staged and shockingly powerful. “Babel” is an infuriatingly well-made disaster.

Arriaga and Iñárritu’s theme is the pathos of ignorance. All over the world, terrible things happen, and we cannot know or feel them. We do not speak one another’s language or share one another’s customs, but an eagle-eyed artist, as he spans the globe, can link us together. As a mood, this globalized empathy is a noble enterprise. As a method of constructing a movie, it’s very hard to pull off. The three stories share a common element in the relationship of parents to children, but they are so idiosyncratic that they don’t comment on one another; they just lie side by side in the same film. I don’t think moviegoers are being overly categorical if they expect a sense of order sterner than trivial contingency. King Lear dies not because Goneril dropped a goblet two months earlier in her bedroom antechamber but because she, her sisters, the other characters, and the disintegrating natural world are part of an intricately worked pattern of will and action and event.

Arriaga and Iñárritu are trying to create potent fictions by harping on pain and misunderstanding. But why? Serendipity is every bit as likely as calamity. Happy chains of the miraculous exist in movie history—they are called screwball comedies, which is not a genre these filmmakers are likely to take up soon. Arriaga and Iñárritu, confusing sheer dread with dramatic tension, make us suffer, but in that case we had better learn something new, and I’m not sure there’s much to be learned from watching Cate Blanchett scream as she’s sewn up by a Moroccan village doctor except for the bourgeois lesson that wealthy Westerners should think twice before leaving the friendly confines of a comfortable hotel. It remains to be said that Brad Pitt gives a good performance as the distraught husband; the trials of the girl in Tokyo (Rinko Kikuchi), desperate for the embrace of a man, are carried off with the utmost boldness, delicacy, and understanding; and the entire movie looks magnificent—the neon nightscapes in Japan and the brownish mountain wastes of Morocco, too. Iñárritu has enough talent to shake up conventional moviemaking. But he still hasn’t figured out how to use it.