Bridging Gap$, Affordable Housing Solution Yields Higher Pay, More Wealth, But Corrupt, Rigged Billionaire’s Moat is Barrier

America woke up today to division. But perhaps 75 percent (+/-) of the nation’s people could come together on a plan that demonstrably could do the following.

  • Increase the U.S. Gross Domestic Product (GDP) by some $2 Trillion Annually, without new federal spending.
  • Provide proven, new affordable home ownership opportunities that left and right agree could boost the personal wealth of millions who now are trapped in rental housing.
  • This would be accomplished by applying existing laws. It could also be fostered by applying the principles prudently found by applying Affirmatively Furthering Fair Housing (AFFH), which we have advocated previously.
  • This outline is possible by following the logic of concepts that bridge the left-right political divide.

This common-sense plan starts with you.

It involves respectfully considering voices on either side of the political aisle, because each side has notable points similar to what the other has made too.

While this won’t cost the federal government – taxpayers – more money, this plan will cost one or more billionaires what they think is/are their marketplace advantage(s). More on that below.  But briefly, some on both sides of the political aisle have argued for years that the “system is rigged.”


In principle, editorially we have no problem with money honestly earned.  By contrast, this publication does have an editorial issue with money unethically, illegally, or otherwise earned by manipulating economic, regulatory, and political systems.

That includes opposition to behavior that is purportedly monopolistic or violates antitrust laws.



NIMBYite Fear Overcome by Understanding Facts, Evidence, #HousingChoice, #Yimby

Freedom is a claimed hallmark of America. Within established norms and practical constraints, we are supposed to be free to choose our profession, partner, who we vote for, dwelling, transportation, clothing, diet and more.

But in fact, freedom in housing choice has arguably been artificially limited in the U.S. for decades.

According to two NBER researchers cited below, those NIMBYite – Not in My Back Yard – artificial barriers cost the U.S. some $2 trillion annually in lost GDP. How so? Because affordable housing isn’t as available where it must be. Applying a principle those two NBER researchers advocated – in a unique way which they may not have considered – could set the stage for significant economic growth.  That in turn would boost earnings, personal wealth for potentially millions of working or middle class Americans, and retirees too.




Technology and various advancements have made homes more efficient, and in some cases, faster and less costly to build.

But prejudice, misinformation, and local policy barriers have harmed an obvious and proven solution. What makes this proven solution particularly appealing is that under a largely overlooked federal law, this form of #HousingChoice already has ‘enhanced federal preemption.’ The laws needed already exist.

However, those existing laws need to be enforced.

The principles involved are also in keeping with AFFH.

While NIMBYites fear their housing values will be negatively impacted, according to research by Trulia, that’s not a factually valid fear.




The solution to the affordable housing crisis has been hiding in plain sight for years. It’s modern manufactured homes, built to the federal Housing and Urban Development (HUD) standards, known as the HUD Code for manufactured housing. A university level, third-party HUD PD&R conducted during the Obama adminstration demonstrated that existing housing values can and do grow side-by-side with new affordable manufactured homes.  The photo below is from a HUD commissioned research study, linked here.  So note that what Trulia found dovetails with what the HUD PD&R previously discovered and documented.


What photos like this don’t reveal is the neighboring housing. Having been to urban infill sites besides the one that this report cites out of Oakland, this writer can say that the manufactured homes similar or sometimes superior in appearance to the other housing around it.  To see the HUD PD&R, that revealed that these homes and their neighboring homes both appreciated, click here.


More recently, the Federal Housing Finance Agency (FHFA) also noted that manufactured homes appreciate in value.  Quoting from the August, 2018 FHFA research report:

In general, the figures suggest that manufactured homes have seen price trends broadly similar to those of other homes. According to the purchase-only series, since 1995, prices have risen by roughly 120 percent for manufactured homes vs. 140 percent for other homes.” What must be understood, is that the FHFA reported increasing value despite the fact that the Government Sponsored Enterprises (GSEs) and others have not properly supported manufactured homes by good lending.

Here’s how the Urban Institute described that almost exactly a year ago (2018).


The explanation for the comment in the red text box will be documented further below.


Appreciation patterns – based upon these various third-party data points – could mirror that of conventional housing, based upon factors like access to more competitive lending.

That said, the notion of appreciation for manufactured homes is a positive development, known to some for many years, but is now coming to light via such third-party research.


The Manufactured Housing Improvement Act of 2000

The Manufactured Housing Improvement Act of 2000 (MHIA) established what is called ‘enhanced preemption’ for manufactured homes. By applying that law, the principles the two NBER researchers noted above advocated could be put into practice, without years of waiting.

So special interest groups – like the giant conglomerate, Berkshire Hathaway, and others – must be objectively understood though the lens of:

  • evidence,
  • money trails,
  • and then an appropriate application of antitrust law, and possibly other federal laws, such as RICO.


The purpose of this report isn’t to go into the various ways that RICO may apply, but this notion has been vetted by attorneys familiar with the issues.


The Government Accountability Office (GAO) determined in 2014 that manufactured home payments were generally lower than any other kind of housing. Note that this was true, even though the Berkshire Hathaway lenders charged a higher interest rate.  Those two Berkshire lenders, VMF and 21st, are the two dominant lenders in manufactured housing finance, and have been for some years.


The GAO report that produced the graphic above documented the fact that manufactured homes are the most affordable kind of living, less than rent or other kinds of housing. More recently, the National Association of Realtors did research in 2018 that came to a similar finding.


Those among the 22 million who already own and/or live in a mobile or manufactured home – see definitions, below – are impacted by these factors.  So are tens of millions of renters.  Per the applied logic revealed by the NBER researchers argument noted above – this alleged market manipulation harms most other housing owners too.  The evidence for these points noted above are summarized at this link here.


The Ultimate Manufactured Home infographic.


Once the facts about modern manufactured homes are properly understood, this concept would benefit the vast majority of Americans, save a few purportedly corrupted special interests. Again, editorially we have no problem with money honestly earned, but we do oppose money earned by unethical activity that violates laws and/or has rigged free market systems.


When Mr. Buffett says that they allow their business units to work independently. So, given the facts shown, what follows could be understood as collusion, which can be actionable under antitrust law.


Price fixing, bid rigging, and other forms of collusion are illegal and are subject to criminal prosecution by the Antitrust Division of the United States Department of Justice,” per the Department of Justice (DoJ) website.


Evidence for Antitrust, Collusion, and “Rigged System”

We’ll say this once, for the balance of the content of this column.  The pointed concerns should be considered as allegations, and the evidence should be seen for what it is.  Apply your common sense.  People are considered innocent until proven guilty in a court of law, or via a plea or other settlement arrangement. We say that because some of those who we are reporting on herein have threatened legal action several times, and that too is an interesting, noteworthy point.  Because they have not yet publicly disputed these allegations.  Rather, they want us to ‘cease and desist‘ in spotlighting them, their brands, and the related issues noted herein.  The ‘why’ behind that will become apparent.

That said, let’s dive in more deeply.

In 2009 Tim Williams, President and CEO of 21st Mortgage sent the following letter out to all of their retailers.  As the letter reflects, it cut off lending to those who didn’t carry Clayton Homes, or did not commit to replacing inventory with Clayton Homes, or and/or sell 21st Mortgage repossessions.

Williams claimed he had to do this, due to economic conditions after the 2008 mortgage/housing crisis meltdown.  Williams’ claim sounded plausible at that time to many, given this occurred after the 2008 housing/credit crisis.




The problem with Williams claim?  For that same year, Berkshire Hathaway Chairman Warren Buffett in his annual letter said that they had plenty of money.  In fact, Berkshire said they loaned money to others.

Rephrased, Warren Buffett, and later Williams’ Berkshire colleague Kevin Clayton, both contradicted key points made in Williams’ letter, above. Let’s look at some specific Buffett quotes, and then you can watch a video of Kevin Clayton. That will allow you to see and hear the evidence for yourself.


Quotes from Warren Buffett’s Annual Berkshire Hathaway Letter

WarrenBuffettBerkshireHathawayChairmanClaytonHomes21stMortgageVanderbiltMortgageManufacturedHomeLivingNewsOur gain in net worth during 2009 was $21.8 billion, which increased the per-share book value of both our Class A and Class B stock by 19.8%. Over the last 45 years (that is, since present management took over) book value has grown from $19 to $84,487, a rate of 20.3% compounded annually,” said Warren Buffett, Chairman of Berkshire Hathaway, in his 2009 annual letter to shareholders

In manufactured housing, Buffett and Munger have made statements that made clear that they had no doubt about the future of the manufactured housing industry.  Investors?  Affordable housing advocates?  Take note.

When the financial system went into cardiac arrest in September 2008, Berkshire was a supplier of liquidity and capital to the system, not a supplicant. At the very peak of the crisis, we poured $15.5 billion into a business world that could otherwise look only to the federal government for help,” said that same 2009 annual letter. What did that mean for manufactured housing professionals?

We tend to let our many subsidiaries operate on their own, without our supervising and monitoring them to any degree…Most of our managers, however, use the independence we grant them magnificently, rewarding our confidence by maintaining an owner-oriented attitude that is invaluable and too seldom found in huge organizations,” said Buffett that year.

Our largest operation in this sector is Clayton Homes, the country’s leading producer of modular and manufactured homes. Clayton was not always number one: A decade ago the three leading manufacturers were Fleetwood, Champion and Oakwood, which together accounted for 44% of the output of the industry. All have since gone bankrupt. Total industry output, meanwhile, has fallen from 382,000 units in 1999 to 60,000 units in 2009.”

By the way, the industry shipped 372,000+ in 1998 – not 1999. And in 2009, the total shipments were under 50,000 homes.  So, that last paragraph above had at least two fact errors. But let’s press on.

Buffett explains how he sees his role in the video below.  Notice his expression, the “Moat.”



Buffett speaks about “the moat” from time to time. The meme/quote below is by a third-party, but is seems to apply to what has been occurring in manufactured housing since 2003.



Furthermore, as a video interview with Kevin Clayton of Clayton homes reflects that ‘Warren’ told him that they have ‘plenty of money.’ Clayton says Buffett hammers away at competition and the moat, but otherwise gives them significant liberty – and considerable financial support. So Clayton and other Berkshire managers have expanding the moat preached to them, per his comments in the video below.




Kevin goes onto say in the video above elements of how their “moat” works.  Clayton explained that Buffett preaches that moat and how they are supposed to be tough on competitors, how they like to use nonprofits, and more. All of these are Clayton’s self-proclaimed truths, hiding in plain sight.

The video interview was done by a Buffett believer.  We added commentary to it under fair use guidelines, to help viewers better understand the points Kevin Clayton is making. But not one word of either the interviewer or Kevin Clayton has been changed.  The cartoons that follow summarize – in a satirical manner – some of the points that Kevin and interview Robert Miles made in their video.


Read the article. Read these cartoons. Then watch the video, and you’ll likely get it.


Needless to say, Clayton does not admit in the video to being a monopolist. But he does say is that “Warren” and thus, Clayton – preach “the Moat” and their anti-competitive principles to their team, in his own words.

Update added 10.2.2019 There are a lot of puzzle pieces that fit together here. That’s a test of logic for the evidence. Perhaps MHI, Clayton, or Berkshire Hathaway could explain all this differently? But if so, they have declined doing so repeatedly. Thus, the allegations and the evidence stand unchallenged at this point in time.

So for clarity and to underscore the point, a Clayton manager messaged our publisher to say, What’s wrong with crushing the competition?’ That’s the mindset. The answer is that there is healthy and unhealthy competition.


In the video, Kevin Clayton doesn’t use these words, but the concepts are there, in his own words. Consider these cartoons as satirical, useful, interpretative keys.


Healthy and Unhealthy Competition

What sports referee would tolerate a deliberate hit designed to kill another player?  That’s unhealthy competition, and the metaphor applies here in business too.  The Atlantic did a report based in part upon IBISWorld research after the 21st letter above was delivered to thousands of manufactured home business locations. What the Atlantic report did was accurately project what the impact of the moat would be, even though they didn’t reference the letter or the term, ‘the moat.’


When that 21st Mortgage letter, posted above, went out, it was in the aftermath of the 2008 financial crisis. It was likely plausible to hard working industry professionals, who didn’t have time to wonder if the letter was candid or not.  They had to get busy trying to find other finance sources. That’s how this could be done in the open.


The market share graphics posted reveal what has happened since Clayton and 21st pulled this arguably successful “moat” strategy.


2003 is the year that Buffett bought Clayton Homes, and other ‘assets’ in manufactured housing.


While several mainstream media sources have reported on aspects of this problem – such as the Derek Thompson Atlantic report mentioned above, until now, only MHProNews and now MHLivingNews have laid out the evidence for how this was actually accomplished. The 21st letter, the video, Buffett’s quotes, and their impact – once understood, reflect how this growing monopolization was specifically accomplished.  Based upon an understanding of specific aspects of antitrust and RICO, what has occurred arguably crossed several legal lines.  This is a slow motion process, that examined in hindsight, can be graphed as shown above and below.


This is after the 21st Mortgage letter – part of the Berkshire moat strategy – had started to topple independents. Of course, Clayton’s market share grew.


There is more.  But this is sufficient for now to grasp the following points.


Clayton Homes claimed in 2017 to ‘only’ have 47.7 percent of the market share, other reports put their market share at 50 percent. Either way, the trend lines are clear. By manipulating credit, capital, regulatory, and allowing misinformation to persist about manufacturted homes, Clayton’s market share has grown.  Meanwhile the industry’s independents in thousands of cases were put out of business and/or were acquired by others at a discounted price.
For some years, the Manufactured Housing Institute’s (MHI) Executive Committee has routinely had one or two of the four members who worked directly for a Berkshire Hathaway brand. Others, like Nathan Smith, have deep ties to Berkshire brands that work in manufactured housing.  Reportedly thousands of manufactured home retailers vanished in the aftermath of this “strategic Moat” ploy.  It also impacted independently owned manufactured home communities too. MHI ignores those concerns, and routinely defends Clayton, 21st, and the Berkshire brands in manufactured housing. Note that MHLivingNews has asked Clayton Homes, 21st Mortgage, VMF, MHI, and their outside attorney to clarify, refute, or otherwise comment on these allegationsThey have repeatedly declined to comment.  




Alan Amy is an award-winning retailer we interviewed for MHLivingNews.  Amy’s point about billion-dollar operations wanting to buy up the industry takes on a new meaning, in the light of market manipulation and monopolization.  So, this is now becoming more apparent.  But thousands of companies now have few options, because Clayton, 21st, and VMF continue to take steps that manipulate the market. One example is how the Duty to Serve process by the Government Sponsored Enterprises was handled by their puppet association, MHI.  That will be the subject of another upcoming report.




Does this seem plausible?  Let’s look further.

Scandal-plagued Nathan Smith’s SSK Communities earned an “F” rating from the Better Business Bureau.  Nathan was MHI chairman at that time.




In the video below, Nathan Smith laughs as he says he wants all of the communities for himself. That’s an exaggeration to make a point, so was that spoken like a true monopolist?



Nathan also admits – again, while he was the Chairman of the Manufactured Housing Institute (MHI) – that the association must admit that they have often failed.  Its an interesting, and arguably honest admission. Because those ‘failures’ notably can be seen as being useful to create head winds for smaller firms, which in turn helps a larger firm like Clayton Homes and their affiliated lenders.

But the problems that occurred before politically-connected Smith made that statement have generally continued.

While some of these people are Democrats – Buffett, Smith – that should not be construed as an indictment of all Democrats. Look enough, and political corruption can be found in all major or minor parties.

That’s part of the problem. It’s corruption of the political and regulatory system which has given some measure of cover to these billionaires and millionaires who manipulate and rig the system to their own benefit. Meanwhile, the general public suffers the effects.


These “moat” tactics have arguably harmed the resale values of manufactured home owners, and have had other harmful consequences to home owners, would be buyers, government at many levels, business, and more modest investors.


What is Clayton, 21st, MHI’s Response?

It should be noted that MHI, Clayton Homes, 21st Mortgage, et al have been invited to comment on these issues.  We’ve asked them to explain them away – if possible – or to disprove any of these claims.  They’ve not done so.  We hereby invite them once more to attempt to refute the logic or the facts presented. The quote from Eric Belsky, then with the Harvard Joint Center on Housing Studies, is interesting because he projected that manufactured housing would grow. As the graphic above, it in fact declined dramatically.  What accounts for the miss?  It is arguably due in part to the fact that Belsky could not have anticipated the Berkshire acquisition of Clayton Homes and their affiliated lenders in manufactured housing by Warren Buffett led Berkshire Hathaway.


Why was Harvard’s JCHS expert Belsky incorrect on his projection? Arguably because he made it before Warren Buffett’s Berkshire Hathaway acquired Clayton Homes, financing, and other parts of the manufactured housing industry. There’s more, but this is sufficient to get a thinking person started.


What Has MHI, Clayton and their Lenders Said?

Note that when Doug Ryan wrote that article, Lesli Gooch – SVP and MHI – rapidly replied to it.  But Ryan offered no documentary evidence, as is shown above.  That made it arguably easier for Gooch to respond to, didn’t it?





By contrast, as recently as last week,  MHI’s leadership, Kevin Clayton, Clayton attorney Tom Hodges, Tim Williams and others in the mix were invited to disprove any of the contentions noted.  Silence.

Rather, what they’ve done is try to threaten us with ‘cease and desist’ letters from an outside attorney who has an office in Nathan Smith’s home town.

It should be clear that they have the financial horse power to sue anyone that they want to.  So we, MHLivingNews, and our parent LLC have proceed out of an abundance of caution in how we’ve presented this materials, while noting that we have no intention to surrender our first amendment right to freedom of the press.  Nor will we willingly give up our right to ethical and responsible free speech.

To MHI and their puppet-masters in Knoxville and Omaha, these must be #nettlesomethings.

In closing, manufactured homes are a solution for the affordable housing crisis.  It’s not the only solution, there should be #HousingChoice.  There should also be #OpenMarkets instead of rigged, monopolistic markets.

If #antitrust laws are applied, arguably much of the corruption of Washington, D.C. could be cleared up.  There is no need to wait for new legislation.  The #RiggedSystem can be addressed immediately, by applying existing laws.

Democrats in their ‘new deal,’ some Republicans, and President Donald J. Trump have all been among those who’ve said they want to address the problem of monopolies with antitrust. Let’s see what happens.  More to the point, ask your public officials to investigate these matters, and ask them to ‘enforce the law.’ Doing so would be good for the country. “We Provide, You Decide.”  ## (Lifestyle news, commentary, and analysis.) (Third party images are provided under fair use guidelines for media.)

Soheyla Kovach (pronounced “SoHeyLa” and “CoVatch” like a Watch with a V), left. Tamas (pronounced TahMash) Kovach, center. L. A. “Tony” Kovach, right. Photo by 83 Degrees media, see their story on our operation at this link here.



Soheyla Kovach co-founder of MHLivingNews, on left,
with son Tamas (pronounced like Tah Mash), and publisher L. A. ‘Tony’ Kovach, on the right.







Related Reports:

Click on the image/text box to see that report.


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