Tuesday, July 24, 2007
Thought Experiment
Thought Experiments are interesting creatures that have fallen out of favor for some reason. In literature there is an entire genre called speculative fiction. Personal favorites include "What if Charlemagne had not been ambushed in the mountains?" and "What if Alexander had eschewed his ill fated Indian adventure?" The idea was revived for me upon reading "Catch That Zeppelin" by Fritz Leiber who won the Hugo and Nebula awards for Best Short Story presented in 1975. A story that had, until now, escaped me. We can play this game at many points. What if the 2/5 cap gains provision never passed? Greenspan had tightened earlier? On and on. The question I put forth; "What if people stopped considering the investment aspects of homeownership."
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75 comments:
Murst?
They'd have more time to be MURST!
See, if only I hadn't wasted precious seconds considering the investment aspects of homeownership...
An English comic used to do this and the ones I like are:
"Titanic arrives New York"
and
"Archduke Ferdinand alive - WW1 a mistake"
There was also a series of adverts by a condom firm along the lines of "if only they'd used a condom" featuring, amongst others, Mr and Mrs Hitler Snr.
By the way, I'm back online now after being messed about for weeks by housing and utility problems, so looking forward to joining in again.
I think the one that did the most damage was the 2/5 cap gains provision. It allowed for 'cash back at close'.
If you are a seller, you don't want to pay more capital gains tax than what you are really getting for a house. There is a dis-incentive to overstate the amount a house sells for, for the benefit of the buyer, because you (the seller) would be taxed on an amount you did not receive.
The large cash backs allowed people with no income to carry a mortgage. All they had to do was cash back in the total amount of about 2 to 3 years of mortgage payments and then sell before the 'cash back' runs out. This, of course, presumes that prices are continually going up.
I know I'm a couple hours late for a first or murst. But this maybe the closest I'm ever going to get.
It's funny that you brought this topic up today. I started reading Fooled by Randomness by Nassim Taleb yesterday. He briefly touches on the concept of alternate histories. My dad has been a big fan of the What If? series for sometime now. And I had never really gotten into them, but I was planning on picking them up after I was done with Taleb's book.
I find it interesting to ask people about their own lives. And do thought experiments as to how they think their lives would be different had they done one thing differently. I know that my freshman year of college I chose to skip a class to go with my girlfriend to a concert, which ended up resulting in me not being able to transfer to the college I had planned on. Which after some wisdom and experience I realized would have been a mistake. So now instead of having been an English major at an extremely small and extremely liberal college. I'm going to sit for my CPA in January.
Regardless of what would have happened. I know that I smoke a lot less patchouli now than I would have had I transfered.
Another thought experiment could also be, what if I remembered that Rob Dawg was on the west coast? And therefore, I'm not a couple hours late, but only one!
Ogg, to add insult to injury you lost out to somebody named "otis fudpucker." Not to worry, I've really slowed things down here, if I get any lazier firsts could become singularities.
Arthur, things are way different, you've entered a time warp ala Buck Rogers.
BJ, yes cashback transfers with no tax consequences. Is that not part of my larger question about housing as an investment vehicle?
Speculative Fiction: 2017 - "What buy for $2000 per month? Why I can rent this piece of crap for only $2500!"
Joshua. welcome. Oh, and FYI we prefer "left coast" as is our common (incorrect) perception.
Ogg, just saw the avatar. Appropos.
Back to the point, both here and there, housing is one investment that you can borrow against and has tax advantages. Problem is, no politician would ever suggest that the tax breaks were removed, so the advantage continues.
...and FYI we prefer "left coast"...
I prefer "The Ex-colonies".
Indeed Arthur.
I am looking forward to the day when the east coast colonies are properly returned to the crown.
Something I've been kicking around with some of my ar15.com buddies is what would it take for the system to melt down? Say, what if 10-20% of homedebtors just flat refused to pay their mortgages for a month or two? Say they band together and tell the banks to pound sand. WTF is the banks gonna do?
My house is an investment? Oh, I thought it was a place to live.
Thanks for that, Dawg, tee he.
Californicators and Limeys, good Gawd A'mighty, but I'm among the heathens!
Alternate history?
And none of y'all mentioned:
"If the South had Won the Civil War"?
Heck...Spike Lee(!)even made a movie about it.
@Harold Saxon:
"I am looking forward to the day when the east coast colonies are properly returned to the crown."
Funny, that. HM the Queen was properly underwhelmed by her visit to the fetid swamp known as the Jamestown Colony site.
She didn't seem at all interested in the Yorktown Battlefield Victory site.
And I should know...I was in the bushes...with a musket...waiting for her.
Looky-heah, bwah. You all want another tax revolt, start yer bloody own, see?
Stop looking to us hillbillies and bog-jumpers to put th' fear of Gawd into your nobs, huh?
My own personal alternate history:
I DON'T drink that drink that guy in that waterfront dive bought me.
I DON'T wake up 100 miles offshore with some bastard pushing a paintbrush into my hand.
(I'd prolly end up a state-trooper,wearing a funny hat and watching telephone poles whip by for my working life.)
@Tony Soprano:
"Say, what if 10-20% of homedebtors just flat refused to pay their mortgages for a month or two? Say they band together and tell the banks to pound sand. WTF is the banks gonna do?"
Pipe down with that mutiny "crazy talk".
They'll flog you...that's what they'll do.
They'll put the hounds on you and when they catch you, they'll make you watch as they feed your credit cards into a woodchipper.
Man, what a bloodbath for the lenders today. CFC down big. LEND is taking it the ass in the way that would even make Mocha flinch. (They missed their SEC filing date)
IMB (Indymac) is going down as well.
And to top it all off, our dollar is getting hammered to the point where Bernake can no longer sit on his hands and not raise rates.
Isn't the classic American "What if" to do with if two or three more people had voted for the national language to be German not English when the constitution was being drafted?
Alternate history, eh? Not to drop names or blow my cover, but one of my old professors is a very big name in the alt-history world. I like reading it, but my own background doesn't predispose me to it. Changing one or two things in historical time doesn't change much IMHO, because events are never isolated. History is the product of intentional and unintentional actions by many people with diverging goals and actions. "Editing" one of those actions doesn't necessarily change the others.
That, in a nutshell, is why asking what would happen if buyers stopped treating homes as investments. Firstly, of course, you'd have to ask what the alternative would be. In medieval and early modern England, property ownership was considered nothing but an investment, at least for tax purposes. You were taxed on the amount of income your property could produce in a year, much like one is taxed now on capital gains on your investment. Of course property transfers in those days were rarer, but the idea that "property is an investment" was always there. Going against that would be ahistorical; so any alt-historian would have to explain why home ownership was no longer considered an investment.
Even with less favorable real estate laws, I don't think people would stop seeing their home as an investment. Now that most of us don't grow crops or raise livestock on our land, people have looked for other ways to make money from it: home equity loans, or home improvement with an eye to selling it at a better price. Just take a look at the second. What's the largest store by size in your town, generally? One of the home-improvement big boxes. Only a couple decades ago home improvement meant your local hardware store; now it's a massive industry. Obviously many people want to realize greater returns on their property--if you will, on their investment--by increasing its value. Would changing the real estate laws to punish fliptards change that? I doubt it.
I guess the way the question is put the choice is between "Is your home an investment, or just someplace to live?" I'm not sure you can separate the two. My car is just something to use to get to A to B, but that's not going to stop me from thinking about resale value when I'm buying one. Doesn't that make it an investment of sorts too?
@arthur:
Isn't the classic American "What if" to do with if two or three more people had voted for the national language to be German not English when the constitution was being drafted?
That's an urban legend, by the way. The vote in question (in the Pennsylvania Assembly) was not to enforce the national language, but instead to authorize the printing of local laws (and not the Constitution) in German as well as English. Even that failed, which shows you how far away German was from becoming the US language. Just as well--only a handful of Pennsylvanians were German-speakers then or now, and trying to make German the national language would have been as mind-boggling as making Swahili the national language of Australia.
@Sharky.
I don't know that if the South could have ever won the civil war though. It's interesting to think about Lee's orders not falling into Little Mac's hands during the first Maryland campaign, but even had things gone differently in 1862, the CSA was still getting a stuffing in the West.
Speaking of which, I visited Robert Lee's shrine at Lexington last week. It's true, he really did look like Robert Duval.
Once the industrial Northern States decided to enforce their claims of vasal status on the Southern States the poor CSA never stood a chance. Imagine the odds. All they had was both Constitutions on their side.
...That's an urban legend, by the way...
Ah! I wondered about that, thanks for putting me right.
...the poor CSA never stood a chance...
And round where I am they stopped buying their cotton. OK so lots of workers were laid off and starved but it was the principle that mattered. Don't tell anyone though please.
@arthur
And round where I am they stopped buying (the CSA's) cotton. OK so lots of workers were laid off and starved but it was the principle that mattered. Don't tell anyone though please.
Cotton production in British possessions, especially India, was a bigger concern. After all Britain had been happy to buy slave-produced cotton for decades up to the Civil War. But after the Union blockades started and southern cotton shipments became dearer, Indian cotton was cheaper than CSA cotton.
I'd have to start looking up more information, but, I think, the American produced cotton was cheaper up to the ACW. Religious and political anti-slavery opinion in England meant that the cotton manufacturers could "on principle" stop buying cotton from the South and did so. They did stop factories running and laid off workers. It was only a few years later when alternative sources such as India became viable. Presumably both from a cost point of view, the lack of infrastructure in, and supply from, the South and a reluctance to trade following the ACW with people who had boycotted the goods only a few years earlier. We (England) also bought a lot of cotton from Egypt in those days.
I would imagine that indian cotton would not have been an economical substitute until the Suez Canal opened in 1869.
I would imagine that indian cotton would not have been an economical substitute until the Suez Canal opened in 1869.
A notable point. Also, IIRC, Egyptian cotton is finer and used for higher quality cloth.
What if momma Serin had given papa Serin a skull job or happy ending instead of riding the pony.
-No turdflake means you all would have to be bitch'n about something or somebody else...
-The mortgage companies would still have a lot of money that was pissed away.
-G's life would not have gone into a death spiral.
-Some skinhead convict would need to find a new prison bitch to be his girl.
Sort of reminds me of "it's a wonderful life" except everyone in town is screaming JUMP! JUMP! in that snowy bridge scene...
H.
ps homeless dude would have been fine, but needed to find the vacant house next door.
@Harold Saxon:
"I don't know that if the South could have ever won the civil war though."
Sure they could have, but General Lee was incapable of properly conducting a strategic offensive.
And oddly enough, for all his defensive genius, he stepped on his dick at Gettysburg and made EXACTLY the mistake that almost all the Union generals,(including Grant), made against him...he attacked an entrenched and fortified position across open ground with...UTTERLY...no cover or concealment.
Had Lee disengaged or declined battle at Gettysburg,(usually a GREAT idea at a "meeting engagement", he could have continued on his way to Lake Erie and cut the Union in two.
Jubal Early and JEB Stewart would have been my picks too command a "March through Pennsylvania".
BTW...if you're in the Valley, it's "County Fair Season"...Warren County and Fauquier County are having theirs.
If you've never been to a US County Fair...two words:
Tractor Pull.
Oh BTW...
The anniversary of 1st Manassass was last Sunday.
If you should ever be so lucky, I give a strack 1st Manassas "Battlefield Walk".
(And my 2nd Manassas ain't too shabby, either).
I'm working up the Winchester area now, which will be a tall order, since there were:
3 Battles of Winchester,
2 Battles of Kernstown
1 Battle of Opequon Creek
1 Battle of Cedar Creek
and between those affairs, Colonel John Singleton Mosby's Confederate guerrilla forces were operating in the fringes of the area, along with Turner Ashby's Cavalry.
"Casey, you know what would make this blog semi-interesting again? I would like to see the following post:
You know the FBI knows your whereabouts at every moment. Think about that for a second, at every moment they know exactly where you are. They are just waiting for the go ahead to arrest you. It's not going to be a phone call, it's not going to be a turn yourself in type situation, you are a flight risk.
With no notice they will knock on the door, even if you are with friends and/or family, you will be put in handcuff and lead away. With all the press your story has gotten, do you think your arrest will not be reported on?
The stories will start appearing in the paper, locally, likely the first page. They will include quotes from you like "Yes, I committed mortgage fraud".
The whole world will know about your misdeeds, your friends, your family's friends, your wife's friends and family, imagine how awkward and uncomfortable it will be for them it will be for them, it will be the big white elephant in the room, after all, the were so close to someone that was not only an admitted criminal, but someone who boasted about it under the guise of "sharing their mistakes".
You will be strip searched, and completely alone, nothing to read, no one to talk to, no one to tell you that it will be alright, because it won't. It will be hours, perhaps even days before you get to speak to anyone that would genuinely care about your well being, feeling all alone, sharing a small cell with someone that has likely committed crimes that you consider much much worse, assault, robbery, rape, etc, you will be just waiting to appear in front of a judge and likely cameras there to document your um-kept appearance and orange jumpsuit just waiting to be published in the local newspaper the next day for all your friends and family and their friends and family to see.
Please, I would really like to see a post on what it's like to be looking towards that and how you plan on handling it."
Cross post from IAFF because I doubt he will let it go though.
Ho Ho Ho - It's Santa Flipper Clause
Rob Dawg,
your quote ' "Speculative Fiction: 2017 - "What buy for $2000 per month? Why I can rent this piece of crap for only $2500!" ' does not account for the collapse of the US dollar. I think it should be
Speculative Fiction: 2017 - "What buy for $2000 million per month? Why I can rent this piece of crap for only $2500 million!"
Santa F. Clause
Noticed in passing...
It seems the Minimum Wage is going to increase by 50%, to $7 and change an hour, by 2009.
What that MEANS is that prices are going to be inflated by AT LEAST that much over what they are today.
And...as I suspected...yesterday's ridiculously overpriced real estate is going to be paid off with tomorrow's cheaper and weaker dollars.
Assuming that one is still gainfully employed.
@ Sharky,
RE: yesterday's ridiculously overpriced real estate is going to be paid off with tomorrow's cheaper and weaker dollars.
+++++++++++++++++++___________________
Thank you for reminding me why I bought!!!
and
RE: Assuming that one is still gainfully employed.
*******************===================
I will be, I am in the oil biz and oil is at the bottom of the next bubble, imo.
@ Casey,
Life is good when one plays by the rules.
>> if Greenspan never relaxed
we would be talking about how we never recovered from the 92-93 recession. How Clinton let Great Depression II start on his watch.
https://www.tdnam.com/trpItemListing.aspx?&miid=7719233
10% daily price chop
100% will go to my vacation in Norway
FMW:
"I will be, I am in the oil biz and oil is at the bottom of the next bubble, imo."
I may be joining the "Oil Patch".
A guy's offered me a gig on a deepwater exploration/wellhead ship.
Presently, she's 125 miles out in the Gulf of Mexico...clean off the continental shelf,(which surprised me, I didn't know there were deposits under deep water. He said they KNOW that there is. Kinda means that our planet's topography was radically different before the Pangaea stage of tectonics, doesn't it? We're no longer talking about ancient inland seas of the Midwest and Canada's Athabasca are we?)
Anyway, the money's better than what I make now, the rotation is stoopid good, and the ships are brand new,(I'm tired of making old junk work).
I'd take it because this guy is calling me. I've worked for him several times before,(the last time we pushed 25k tons of obsolete bombs from Diego Garcia to North Carolina...on a literal "death ship").
@ Sharky,
Wow, That sounds exciting. We have producing wells in the Gulf as well.
With modern 3D and 4D schematics and modern drill techniques, they hit 60% to 79% of the wells, even deep wells.
I love the oil biz. I am safe in mothers financial arms. Let the economy go to hell in a hand basket, nothing I can do about the KC's of the world.
It is gonna get fugly for some here in Orlando.
By the way, Caseyboi just posted an anti peak oil comment.
He does read EN.
Hey Harold, we didnt lose.. we are just re-grouping.. :-)
"At 12:48 PM, Harold Saxon said...
@Sharky.
I don't know that if the South could have ever won the civil war though"
I saw the 'peak oil' comment.
Cold fusion eh? Sounds like he is getting caught up in one of those penny stocks. Fusion just 'magically occurs'.. If the energy threshold for fusion was that low, it would be happening all the time and we wouldn't have any hydrogen left!
Actually, sci-fi author Harry Turtledove is known for his alternate timeline series of books, many of which deal with the implications of a CSA victory. You can look him up on Wikipedia for lots of info.
Another thing about alternate history that few realize is that any change will have a domino effect on many future events.
In 1881, Republican James G. Blaine has ridden a hard-line platform of anti-Confederatism into the White House, having defeated Democratic incumbent Samuel J. Tilden in the 1880 presidential election. Both American nations have been sanctioning Indian raids into each other's territory. The international tension between the United States and the Confederate States peaks when Confederate President James Longstreet, desiring a Pacific coast, purchases the provinces of Sonora and Chihuahua from the financially-strapped Mexican Empire (which is still ruled by Maximilian) for CS $3,000,000. Blaine uses the "coerced" purchase as a casus belli, leading to the commencement of what will later become known as the Second Mexican War.
http://en.wikipedia.org/wiki/How_Few_Remain
Haw-haw-haw!
"Survivalist Casey Serin...Magic Energy Bean Battery-Thingy Tycoon"!
Near soiled me fuckin' self from laughing!
New blog ideas:
"IAmFacingStarvation"
"IAmFacingEntropy"
@ Sharky and BJ,
Consider this. Casey just liked typing the 700 million dollars in the cold fusion comment.
Just speculating.
Pun intended.
tee he
KC COMMENT:
#42. OHMY!
July 24th, 2007 at 6:50 am
Ever heard of Peak Oil?
Yes I’ve heard, reading websites like LifeAfterPeakOil.com will convince you that we’re about to have the end of civilization as we know it. I was starting to buy into it and even started looking into honing my surviving / fishing / farming skills.
But then I talked to someone who is involved in funding $700 million for a cold-fusion type of battery-thingy that basically never runs out of energy. Once that technology is in place everything can be powered by it: cell phones, cars, houses, airplanes, spaceships, and never run out of juice. As crazy as it sounds I believe its real. (It’s sweet to have access to these types of connections.)
So if this thing takes off the oil companies may go out of business (provided these companies don’t try to squash this new startup). And the whole Peak Oil scare is not going to be much of an issue.
Yeah, and once I farted and a peanut came out, free food! Man, he'll believe anything, the perfect mark.
@ Duane,
But was it not called the War of Northern Aggression? Said in ones most charming southern drawl.
Signed,
A daughter of the Confederacy.
te hee
@ Mort,
You are in a good mood tonight.
ROTFLMFAO at Casey farting out food.
tee he
Hi FMW, here's a song for ya. ;)
I see that Casey flunked his high school physics class as well as being the world's worst real estate investor.
OMG,
How did you know I love old classic tunes?
Thanks.
gtg
S
@ Mort,
Had to go post at your sight.(-:
Now, W2 tomorrow.
@Rob Dawg,
Was this thought experiment thread foreshadowing Casey's "cold-fusion type of battery-thingy that basically never runs out of energy" discovery?
KC: "even started looking into honing my surviving / fishing / farming skills."
Corona. Out my nose. All over the keyboard. 'Nuff said...
@FMW
Bet you're a G.R.I.T.S.
The casimir effect will save us all.
KC: "even started looking into honing my surviving / fishing / farming skills."
The image of KC, the mountain man, is just too much. Jeremiah Constantin Serin? LMFAO!
Somebody photoshop that please!
Let me tell ya a Story 'bout a boi named Casey
His deals were shady and his hair kinda greasy
Then one day when flippin' like a fool...
"Let me tell ya a Story 'bout a boi named Casey
His deals were shady and his hair kinda greasy
Then one day when flippin' like a fool..."
The fliptard started blogging like a natural born tool?
Yep, and G could chew those moose hides so they stay nice and soft. Meanwhile, KC would be out back chopping wood, no, that's work, er fishing? No that's work too. Well he could flip some grizzly bears for some sweet cash back or something...
"You sure have a purrty mouth"
.and
"Squeal like a pig!!"
Deliverance)
Enuf said
H.
Maybe Ogg wants a roomate or Casey can flip his cave with sweet Cashback!
He's got a built-in excuse already for when his energy thingie fails:
So if this thing takes off the oil companies may go out of business (provided these companies don’t try to squash this new startup).
Typical Fusiontard paranoia in play. When it goes belly-up with investor funds, it'll be someone ELSE's fault. The oil companies squashed it! Just like the deceitful banks squashed his RE dreamz.
So, am I missing something or is it is highly unrelated to Maxwell's Demon?
P.S. there just so happens to be some (possibly) awesome shit on TV (involving Cusack and Pacino) so I'm signing out.
Maxwell's demon is best left for the morning.
Bay Area Haterz gathering - supporterz welcome, let's all try to be civil.
Come to the Tied House in Mountain View on July 30th from 7:00 PM until whenever (probably at least 10:30 PM).
Linkage
New post. Ho-hum.
For this post I don’t feel like being creative for your guys. The blog is closing soon so I don’t need to work so hard. Maybe I’m getting lazy or trying to break a bad habit.
GETTING lazy?
And stop bugging me about stuff I promised I was gonna write about, spreadsheets, questions I didn’t answer, etc. And don’t tell me “But you promised!”. I’ve broken so many promises… it’s sad.
Too true.
...stop bugging me about stuff I promised I was gonna write about, .... questions I didn’t answer....
Can't wait to hear what the judge will say in response.
Why, Thank you for noticing, Wagga.
I am a girl raised in the South.
I eat em too, grits, that is.
te hee
FMW
I think he's on another down cycle:
Waiting on Things, Don’t Feel Like Blogging…
A few things are in limbo right now, so I don’t have anything super important to blog about on this post.
In the past when I had no major news l would resort to posting a foreclosure-related email or something creative / random that comes to mind, though I usually found a way to keep it on the foreclosure topic one way or another. For this post I don’t feel like being creative for your guys. The blog is closing soon so I don’t need to work so hard. Maybe I’m getting lazy or trying to break a bad habit.
Some of you don’t realize how much pressure it is to keep 8,000+ daily visitors coming back. Well, I normally don’t think of it as pressure but rather something I just do (for the last 10 months). This is the first time in my life I have an “audience”. My life and the blog have integrated so much that I found myself in the past making certain choices with the perspective of how “blogable” it will be. Always thinking of a new angle!
I’ve poured too much of myself into this thing - both in time and the level of exposure. And I’m now paying the price. It’s quite steep. Don’t get me wrong, I’ve had fun too. And received lots of amazing benefits. But is it worth the hurt and pain that I caused to people around me and to MYSELF?
And stop bugging me about stuff I promised I was gonna write about, spreadsheets, questions I didn’t answer, etc. And don’t tell me “But you promised!”. I’ve broken so many promises… it’s sad. The guilt. The consequences. I can choose to close my eyes but the effects are still there.
I need to start telling myself the truth. I’m great at deceiving myself (and others). Telling myself the truth includes admitting that, YES, indeed I left my wife. I’m not talking leaving physically necessarily. Of course bringing the blog back up and leaving to Australia for a month was definitely the last straw, even though I tried to deny it.
But I’m talking about attitude. I “left her” in the way I’ve been pursuing MY goals and MY business - leaving her to the side. All the “short cuts” and impulsive decisions didn’t help either. I left a long time ago. Years ago.
Perhaps everything that has been happening to me is one BIG slap in the face. A slap in the face to wake me up and open my eyes. I hope I can wake up quickly enough.
Would Casey lose it if he found out his actual audience was more like 1000 Haterz and no one else.
I also thought I had read somewhere that if the South had pressed their advantage early they could have at one point walked right into DC without a Union army to stop them.
Here's a tidbit of family trivia. Alot of folks think that Atlanta got its name because of the Atlantic railroad. That's not true. Atlanta was once called Terminus, then MarthasVille, Then Atlanta.
At the time of these changes, the governor was a guy named Lumpkin, a great-great something or other uncle of mine. His daughter's name was Martha Atalanta Lumpkin...
Atlanta's a typo!
He finally admitted he left is wife long ago. He actually seems to be having a moment of clarity.
I won't hold my hopes up. I'm sure it's already washed over him and dried off.
@FMW
Thought so!
I'm a Boy Raised in the South, but we can't acronymize it 'cause it gets confused with pommies.
"Once the industrial Northern States decided to enforce their claims of vasal status on the Southern States the poor CSA never stood a chance. Imagine the odds. All they had was both Constitutions on their side.'
Wow...no wonder you hate mexicans just a lighter shade of Ni**er.
Boy you make Casey look good.
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