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(Forbes) Interesting Silicon Valley supporters of Obama thought they were backing an iPhone 3G, but are getting a DynaTAC 8000X that fades when you go into a valley   (blogs.forbes.com) divider line 72
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Etchy333 [TotalFark] 2009-02-14 12:54:55 PM  
Now would be the perfect opportunity for John McCain to tell us all what to do to save the country, from this catastrophe that is no way the fault of the Republicans.

 
sloppy shoes 2009-02-14 04:37:48 PM  
WAH! WAH! WAH! I'm a libertarian and no one will listen to my ideas. Further, for no reason whatsoever, I believed that when faced with actual issues, the latest trendy politician would really say to his his country and voters, "ya know what, fark it! We'll just do it live, anything goes. This country doesn't need leadership. What we need is hardship! No more minimum wage, work place standards, or anything. Fark the banking system and the dollar- we're getting rid of it. They failed. Deflation, here we come!"

I'm always amazed that Libertarians can value individuality and yet fail to realize that the collective individuality of everyone else not only thinks they are wrong, but down right dangerous. Guess what idiots, it won't be the "state" that comes to get you, it will be the rioting, distressed crowds produced from your ridiculous policies and beliefs.

 
Control_this [TotalFark] 2009-02-14 05:04:36 PM  
I thought Obama was going to re-architect the national software using object oriented modeling but all he's doing so far is procedural calls.

I also thought he'd feed lady Justice a Red Bull and send her out on a Judge Dredd hunt for the Bush cabal, but so far all he's done is have coffee with her.

 
nacker 2009-02-14 05:35:25 PM  
Lame headline, lame article.

-1

 
RobertBruce [TotalFark] 2009-02-14 05:46:45 PM  
sloppy shoes: it will be the rioting, distressed crowds

Not likely. they're too stupid to know how!

 
sloppy shoes 2009-02-14 05:57:35 PM  
RobertBruce: Not likely. they're too stupid to know how!

Yeah, no. You had a lot of trouble in school, didn't you?

 
Crosshair [TotalFark] 2009-02-14 06:03:59 PM  
sloppy shoes: I'm always amazed that Libertarians can value individuality and yet fail to realize that the collective individuality of everyone else not only thinks they are wrong, but down right dangerous. Guess what idiots, it won't be the "state" that comes to get you, it will be the rioting, distressed crowds produced from your ridiculous policies and beliefs.

Yes, the the current path we are taking is SOOOOOOOOO much better. What were we thinking. *roll eyes*

 
DamnYankees [TotalFark] 2009-02-14 06:07:00 PM  
Did Obama campaign as a libertarian and I didn't notice it? There's nothin remotely surprising with any of his actions so far - this is the stuff he campaigned on.

 
sloppy shoes 2009-02-14 06:10:30 PM  
Crosshair:
Yes, the the current path we are taking is SOOOOOOOOO much better. What were we thinking. *roll eyes*


I know. HOW DARE GOVERNMENT SPEND MONEY ON ITS PEOPLE? What is this? China? USSR? Capitalism, motherfarkers, do you speak it? Dammit, I voted for Somalia.

/A good government only spends money on tanks and bombs. Schools, roads, trains, health care, insurance, and other things are for pussies.
//Also, a real man knows that debt and consumer spending are evil. If we had a real man's currency of gold, our economy would function on making products that we never sell to anybody.

 
nacker 2009-02-14 06:11:17 PM  
sloppy shoes: I know. HOW DARE GOVERNMENT SPEND MONEY ON ITS PEOPLE? What is this? China? USSR? Capitalism, motherfarkers, do you speak it? Dammit, I voted for Somalia.

/A good government only spends money on tanks and bombs. Schools, roads, trains, health care, insurance, and other things are for pussies.
//Also, a real man knows that debt and consumer spending are evil. If we had a real man's currency of gold, our economy would function on making products that we never sell to anybody.



Don't forget our tax cuts!!!!

 
sloppy shoes 2009-02-14 06:16:42 PM  
nacker: Don't forget our tax cuts!!!!

Tax cuts are for liberals, because only liberals support government. A real man operates a voluntary, as necessary government. Rules cannot create liberty. It's fascism. Even a child of Darkness who supports shiatty metal and punk music can tell you that any institutionalized form of thinking creates slavery that rapes our autonomy and disparages our humanity. Just look at the current music scene- government regulation has given us American Idol and Nickleback. In my day, we had the Rolling Stones, Bob Dylan, Peter Paul and Mary, bands that could think. The Killers wouldn't know the difference between manslaughter and first degree murder.

 
DamnYankees [TotalFark] 2009-02-14 06:24:15 PM  
I had a thought about the economic crisis today and I was wondering what some of you thought of it.

So the problem here began with the bursting of the real estate bubble, right? Homes which used to be worth a lot more and now not worth as much - they have lost 20% of their value of whatever. The value of those homes literally disappeared - poof. Gone.

So why doesn't the government literally replace the money that 'disappeared' with new cash? Imagine if 20% of people's money had literally just burned in a fire - the physical money disappeared through a freak natural accident. Would we object to the government just reprinting the bills and restoring the cash? Why is this different? Genuine question, not a polemic.

 
A Dark Evil Omen 2009-02-14 06:27:33 PM  
DamnYankees: I had a thought about the economic crisis today and I was wondering what some of you thought of it.

So the problem here began with the bursting of the real estate bubble, right? Homes which used to be worth a lot more and now not worth as much - they have lost 20% of their value of whatever. The value of those homes literally disappeared - poof. Gone.

So why doesn't the government literally replace the money that 'disappeared' with new cash? Imagine if 20% of people's money had literally just burned in a fire - the physical money disappeared through a freak natural accident. Would we object to the government just reprinting the bills and restoring the cash? Why is this different? Genuine question, not a polemic.


The problem is that the wealth isn't "gone" because it never really existed in the first place. It was all paper. The government could "make up" the lost value but what you'd get is instead of teetering on the edge of deflation as we are, there would be a sharp shock of inflation without any increased value.

So all you'd end up doing is dumping a bunch of cold water on Wall Street and I'd have to pay $1 more for bread.

 
DamnYankees [TotalFark] 2009-02-14 06:29:20 PM  
A Dark Evil Omen: The problem is that the wealth isn't "gone" because it never really existed in the first place. It was all paper.

I don't know what you mean it never existed. Seemed to exist when people were buying and selling homes for that price. And "it was all paper"? Isn't that was cash is?

A Dark Evil Omen: The government could "make up" the lost value but what you'd get is instead of teetering on the edge of deflation as we are, there would be a sharp shock of inflation without any increased value.

How would there be inflation if we were merely recovering lost value? Aren't we facing deflation now due to a recession and a contraction of equity?

 
paygun 2009-02-14 06:32:38 PM  
DamnYankees: Did Obama campaign as a libertarian and I didn't notice it? There's nothin remotely surprising with any of his actions so far - this is the stuff he campaigned on.

No kidding. Something I've seen here over and over again though is that people tend to see Obama with their own vision of him regardless of what he really is. I guess it's human nature, people did it with Bush too.

 
jankyboy 2009-02-14 06:32:57 PM  
Etchy333: Now would be the perfect opportunity for John McCain to tell us all what to do to save the country, from this catastrophe that is no way entirely the fault of the Republicans.

FTFY

/share the love

 
Fart_Machine 2009-02-14 06:34:06 PM  
It's amusing that a Libertarian calls someone "backward-thinking" when they want to return to the good old days of the Gilded Age.

 
cltbuilder 2009-02-14 06:35:02 PM  
sloppy shoes: HOW DARE GOVERNMENT SPEND MONEY ON ITS PEOPLE?

A government doesn't have any money that doesn't come from the people. Unless it's play money.

 
paygun 2009-02-14 06:36:08 PM  
A Dark Evil Omen: The problem is that the wealth isn't "gone" because it never really existed in the first place. It was all paper. The government could "make up" the lost value but what you'd get is instead of teetering on the edge of deflation as we are, there would be a sharp shock of inflation without any increased value.

I'll agree with you about that as long you don't use it as an opportunity to scream at me and tell me how evil I am. Just sayin.

 
DamnYankees [TotalFark] 2009-02-14 06:36:27 PM  
cltbuilder: A government doesn't have any money that doesn't come from the people. Unless it's play money.

Doesn't all money come from some other person? Unless its counterfeit?

 
zephyy 2009-02-14 06:37:03 PM  
god forbes is just so awful

 
sloppy shoes 2009-02-14 06:37:15 PM  
DamnYankees: So why doesn't the government literally replace the money that 'disappeared' with new cash? Imagine if 20% of people's money had literally just burned in a fire - the physical money disappeared through a freak natural accident. Would we object to the government just reprinting the bills and restoring the cash? Why is this different? Genuine question, not a polemic.

They are. They are recapitalizing the banks.

The problem is the money didn't just disappear in a fire. To do what you are suggesting we would have to destroy all the CDOs attached to them too.

 
A Dark Evil Omen 2009-02-14 06:37:37 PM  
DamnYankees: A Dark Evil Omen: The problem is that the wealth isn't "gone" because it never really existed in the first place. It was all paper.

I don't know what you mean it never existed. Seemed to exist when people were buying and selling homes for that price. And "it was all paper"? Isn't that was cash is?

A Dark Evil Omen: The government could "make up" the lost value but what you'd get is instead of teetering on the edge of deflation as we are, there would be a sharp shock of inflation without any increased value.

How would there be inflation if we were merely recovering lost value? Aren't we facing deflation now due to a recession and a contraction of equity?


People were buying and selling properties based on invented value. There wasn't any additional wealth being created nor any intrinsic value there.

Consider if you paid $100k for a house just before the ubbble burst. The real estate market goes tits up, your house loses 20% of its value overnight, and you're sitting there with an 80k house. Assuming you paid cash, you just lost effectively 20k in value. However, the money you spent is still "alive", let's say. Your house does not have 100k in intrinsic value and there's no additional wealth that has been created, so if the government sent you a big bag with a dollar sign on it with $20k in it to recoup the loss of value from your home, they've just dumped $20k more into an economy where the money you spent is still in circulation, without a commensurate increase in national wealth.

I mean, it definitely would offset deflation, I just don't think it would do it in a safe way at all, I suspect it would be a bigger shock than the current stimulus package or just riding this mess out (which I suspect would be catastrophic anyway).

 
DamnYankees [TotalFark] 2009-02-14 06:38:25 PM  
sloppy shoes: To do what you are suggesting we would have to destroy all the CDOs attached to them too.

Huh? Please explain.

 
sloppy shoes 2009-02-14 06:39:54 PM  
cltbuilder:
A government doesn't have any money that doesn't come from the people. Unless it's play money.


OMG, you're right! Money is a farce! MONOPOLY!!! UNCLE MILTON BRADLEY!!!

You've just opened my mind. What should we use instead? I'm too afraid to think, will barter work? What will it take to get the devils out of my dollar?

 
Gonz 2009-02-14 06:40:07 PM  
DamnYankees: So why doesn't the government literally replace the money that 'disappeared' with new cash? Imagine if 20% of people's money had literally just burned in a fire - the physical money disappeared through a freak natural accident. Would we object to the government just reprinting the bills and restoring the cash? Why is this different? Genuine question, not a polemic.

Well, that's an interesting take on things. Here's my thoughts on the matter- yes, I would object to the government re-printing the money. For starters, there are ways to make your money safe, like banks. If you keep your cash out of a bank, and instead in a flammable place like, say, paper bags in your home, you knowingly assume the risk that it might go up in flames.

"But, Gonz, I don't want to support the banks! They make their profits on the back of the working man!"

Sure, fine, you don't have to support the banks. But you really ought to invest in a fireproof safe to hold the majority of your dollar bills. It's prudent.

The vast majority of homeowners aren't affected one bit by the price of their home decreasing. If their property taxes drop, they'll even see a little more cash in their pocket. The housing bubble bursting mainly affected people who were looking at real estate as a short-term, high-yield investment, and suddenly their goose quit crapping golden eggs. In fact, part of the reason there was a bubble in the first place was that a lot of geese were crapping iron pyrite, and no one paid that much attention.

Combine that with people getting mortgages they couldn't afford- whether or not they understood that- and you end up where we are.

A person's home should be their castle, not their investment. A return to that mindset would be a welcome change, IMO.

 
DamnYankees [TotalFark] 2009-02-14 06:40:52 PM  
A Dark Evil Omen: People were buying and selling properties based on invented value. There wasn't any additional wealth being created nor any intrinsic value there.

I seriously don't know what this means. What is 'invented value'? Value is what people are willing to pay for something. I don't know how you distinguish 'real' value from 'fake' value.

A Dark Evil Omen: Your house does not have 100k in intrinsic value and there's no additional wealth that has been created, so if the government sent you a big bag with a dollar sign on it with $20k in it to recoup the loss of value from your home, they've just dumped $20k more into an economy where the money you spent is still in circulation, without a commensurate increase in national wealth.

But people pay for homes in mortgages. Can't we simply reduce the cost the mortgages by the reduction in home value? Wouldn't that balance the equation?

 
DamnYankees [TotalFark] 2009-02-14 06:43:06 PM  
Gonz: A person's home should be their castle, not their investment. A return to that mindset would be a welcome change, IMO.

I appreciate the moral sentiment here, but I don't see this as a compelling economic argument. This is my problem with so much of the "let the banks crash", "let people who made bad investments fail", or "the recession is due because we overspent" mentalities. They are very nice moral sentiments but I never see good economic basis for them.

If someone's nestegg burns in a fire or if someone intentionally burns their money, there's no economic difference. Even if you think you should reimburse the former and not the latter, that's a moral sentiment and not an economic one.

 
paygun 2009-02-14 06:43:52 PM  
Gonz: A person's home should be their castle, not their investment.

Balderdash! Real estate always goes up!

This idea that anyone can buy spec houses and make money when everyone else is trying to do the same thing reminds me of the baseball cards boom in the 80s. It was a great investment and it did just keep gaining value until everyone did it.

 
sarcastrophe 2009-02-14 06:44:31 PM  
DamnYankees: Did Obama campaign as a libertarian and I didn't notice it? There's nothin remotely surprising with any of his actions so far - this is the stuff he campaigned on.

No... but I know a lot of moderate libertarians that saw his civil liberties side and went on to convince themselves he was something other than a statist. I think most saw it as a "lesser of two evils" thing.

 
Fart_Machine 2009-02-14 06:45:25 PM  
DamnYankees: This is my problem with so much of the "let the banks crash", "let people who made bad investments fail", or "the recession is due because we overspent" mentalities. They are very nice moral sentiments but I never see good economic basis for them.

It's makes it easier to be self-righteous while you're standing next to the other shmoe in the breadline.

 
A Dark Evil Omen 2009-02-14 06:45:55 PM  
DamnYankees: A Dark Evil Omen: People were buying and selling properties based on invented value. There wasn't any additional wealth being created nor any intrinsic value there.

I seriously don't know what this means. What is 'invented value'? Value is what people are willing to pay for something. I don't know how you distinguish 'real' value from 'fake' value.

A Dark Evil Omen: Your house does not have 100k in intrinsic value and there's no additional wealth that has been created, so if the government sent you a big bag with a dollar sign on it with $20k in it to recoup the loss of value from your home, they've just dumped $20k more into an economy where the money you spent is still in circulation, without a commensurate increase in national wealth.

But people pay for homes in mortgages. Can't we simply reduce the cost the mortgages by the reduction in home value? Wouldn't that balance the equation?


By "invented value" I just mean that the prices were inflated. The "proper" value of all that property was lower than what the market was reflecting because people were paying based on easy credit that wasn't really backed up by real wealth.

As for the latter... I do not know. I have overextended my knowledge of econ as it is. Seems like it could work, though. I just don't know. I do know that direct government intervention in house pricing like that would cause a shiatstorm of disapproval from the right, though.

 
sarcastrophe 2009-02-14 06:46:01 PM  
sloppy shoes: Tax cuts are for liberals, because only liberals support government. A real man operates a voluntary, as necessary government. Rules cannot create liberty. It's fascism. Even a child of Darkness who supports shiatty metal and punk music can tell you that any institutionalized form of thinking creates slavery that rapes our autonomy and disparages our humanity. Just look at the current music scene- government regulation has given us American Idol and Nickleback. In my day, we had the Rolling Stones, Bob Dylan, Peter Paul and Mary, bands that could think. The Killers wouldn't know the difference between manslaughter and first degree murder.

Man... you got up on the wrong side of the bed today.

 
sarcastrophe 2009-02-14 06:46:43 PM  
sloppy shoes:

Also... just so you know. I'm the one that pissed in your corn flakes and defecated in your slippers.

 
DamnYankees [TotalFark] 2009-02-14 06:47:41 PM  
A Dark Evil Omen: By "invented value" I just mean that the prices were inflated. The "proper" value of all that property was lower than what the market was reflecting because people were paying based on easy credit that wasn't really backed up by real wealth.

Alright - but this is a moral sentiment which can only really be claimed in hindsight. I mean, maybe 20 years from now people will be mocking us for having paid so much for apples or bread. Value is what it is. In economic terms, value is simply what someone is willing to pay. There's no "proper" value to anything.

A Dark Evil Omen: I do know that direct government intervention in house pricing like that would cause a shiatstorm of disapproval from the right, though.

Makes me think its a good idea, then.

 
jpo2269 2009-02-14 06:48:05 PM  
Damn Yankees, But people pay for homes in mortgages. Can't we simply reduce the cost the mortgages by the reduction in home value? Wouldn't that balance the equation?

In theory yes but..... In times of increased home value would you argue for a person's mortgage to increase as well?

In addition, changing the value of a mortgage up, or down would create uncertainty with banks who couldn't at any one point be able to say what their mortgage portfolio was worth (within a certain percentage range). This level of uncertainty would not be productive for producing additional loans.

 
sloppy shoes 2009-02-14 06:48:14 PM  
DamnYankees:
Huh? Please explain.


We didn't really burn the money. We burned what we bought with the money. The "money" is the CDOs. The easiest way to fix things would be to declare the CDOs bad investments, and that investors must simply "write off" what they cannot recover. However, that obviously goes against our structure of laws, but it also goes against the integrated model for finance and asset allocation/valuation we have developed in the modern economy.

 
acchief 2009-02-14 06:48:41 PM  
DamnYankees: A Dark Evil Omen: The problem is that the wealth isn't "gone" because it never really existed in the first place. It was all paper.

I don't know what you mean it never existed. Seemed to exist when people were buying and selling homes for that price. And "it was all paper"? Isn't that was cash is?


This chart illustrates how high housing prices rose during the current bubble. As you can see, prices rose rapidly at an unsustainable pace. Look at the two previous bubbles on the chart: immediately following the boom, there was a correction where housing prices returned to their normal range. That's why it's called a bubble, once it pops reality/sanity kicks in and prices become reasonable again. That same correction must occur following the latest boom otherwise there will be no economic recovery. You can't just keep stuffing cash under that vertical line to hold it up at its current level because doing so will bring on the collapse of the dollar, making it worth less than toilet paper.

That's why the wealth at the upper level of the chart never existed in the first place, except on paper. It was an irrational boom the likes of which this country has never before experienced, and quite likely won't survive, especially when the government continues to try to keep the correction from happening by trying to artificially prop up those values, even though not a soul on earth will pay those exorbitant prices for homes today.

 
paygun 2009-02-14 06:49:42 PM  
sarcastrophe: No... but I know a lot of moderate libertarians that saw his civil liberties side and went on to convince themselves he was something other than a statist. I think most saw it as a "lesser of two evils" thing.

I can't say I blame them. People don't want to believe we're completely farked.

 
DamnYankees [TotalFark] 2009-02-14 06:49:55 PM  
jpo2269: In theory yes but..... In times of increased home value would you argue for a person's mortgage to increase as well?

Why would we do that?

jpo2269: In addition, changing the value of a mortgage up, or down would create uncertainty with banks who couldn't at any one point be able to say what their mortgage portfolio was worth (within a certain percentage range). This level of uncertainty would not be productive for producing additional loans.

But most of our banks are dead in the water as is. The biggest banks in this country are basically insolvent. I'm not really sure its a problem to be screwing with the banks right now.

 
Lumi 2009-02-14 06:51:10 PM  
FTA: "Forget his liberal Senate record and Saul Alinsky-conditioned career as a community organizer. Forget the Chicago-style thug politics."

Stopped reading there once the author's lean, and AM listening habits, became apparent. Unfortunately it wasn't til halfway through. Fortunately I was just skimming.

 
sarcastrophe 2009-02-14 06:52:13 PM  
paygun: I can't say I blame them. People don't want to believe we're completely farked.

Yeah... except that Obama sucks at a few key points on civil liberties, too.

 
A Dark Evil Omen 2009-02-14 06:53:08 PM  
DamnYankees: A Dark Evil Omen: By "invented value" I just mean that the prices were inflated. The "proper" value of all that property was lower than what the market was reflecting because people were paying based on easy credit that wasn't really backed up by real wealth.

Alright - but this is a moral sentiment which can only really be claimed in hindsight. I mean, maybe 20 years from now people will be mocking us for having paid so much for apples or bread. Value is what it is. In economic terms, value is simply what someone is willing to pay. There's no "proper" value to anything.


I disagree with that and I think what we're seeing is exactly why that's wrong. A huge amount of the cheap credit was based on a ponzi scheme where you ended up with mortgages bundled and repackaged again and again and resold and resold at markups untli you had (for example) a million dollar bundle that had no backing put a $250k mortgage. You can say, "sure, we have eleventy hojillion dollars to lend" based on creative bookkeeping but if the wealth isn't real, at the end of the day it just doesn't exist.

A Dark Evil Omen: I do know that direct government intervention in house pricing like that would cause a shiatstorm of disapproval from the right, though.

Makes me think its a good idea, then.


Well, yes, there is that. :)

 
paygun 2009-02-14 06:56:23 PM  
sarcastrophe: Yeah... except that Obama sucks at a few key points on civil liberties, too.

Yep. He could announce tomorrow that he's repealing the Patriot Act with an executive order and I'd start drinking the kool-aid. But he's not.

 
t3knomanser 2009-02-14 06:56:59 PM  
sloppy shoes: HOW DARE GOVERNMENT SPEND MONEY ON ITS PEOPLE?

Spend my money. My government claims me as property, gives me only the slightest and most meaningless say in its affairs, and has built up so much intrinsic momentum that even if I overcame issues like being unable to afford a campaign for national office, my unwillingness to ally with a party for resources, etc. etc. and somehow managed to get elected, I could accomplish exactly nothing.

Sorry, it's a pet peeve of mine. The Federal government gives me very little but takes nearly 30% of my income. I'd much rather give that kind of money to my local municipality. The Federal government should be able to operate more cheaply per capita than a city does.

Neither here nor there- if I had my way, we'd be living under a self-running government that doesn't involve putting humans in positions of power.

acchief: That's why the wealth at the upper level of the chart never existed in the first place, except on paper.

That's an oversimplification. It did exist. If my home appraised at 300% my initial investment, I could borrow that much. I could sell it for that much. That turns paper wealth into physical wealth.

acchief: government continues to try to keep the correction from happening by trying to artificially prop up those values

Hardly. The government is trying to make sure banks remain liquid enough that they can continue to make loans. Nobody's worried about keeping house prices up except the people in bubbled homes.

 
sloppy shoes 2009-02-14 06:57:44 PM  
sarcastrophe:
Man... you got up on the wrong side of the bed today.
...
Also... just so you know. I'm the one that pissed in your corn flakes and defecated in your slippers.


Haha. I'm having a wonderful day so far.

 
jpo2269 2009-02-14 07:01:38 PM  
Damn Yankees:

My point is this, if we are going to have a system in place where a homeowner's mortgage would decline when housing values declined, there would be an arguement for mortgages to increase when housing values increased. I think both situations are not good in the longterm.

I do agree with you, and I have read many articles in the last few weeks which support your claim that many major banks are basically farked, and in large part by their own doing. What I am arguing is adding a level of uncertainty to this equation would not be a positive thing.

 
sloppy shoes 2009-02-14 07:02:13 PM  
t3knomanser:
Neither here nor there- if I had my way, we'd be living under a self-running government that doesn't involve putting humans in positions of power.


Yeah. The Matrix would be fun and all, but I don't want to worship Keannu Reeves as my savior.

 
Gonz 2009-02-14 07:02:46 PM  
DamnYankees: I appreciate the moral sentiment here, but I don't see this as a compelling economic argument. This is my problem with so much of the "let the banks crash", "let people who made bad investments fail", or "the recession is due because we overspent" mentalities. They are very nice moral sentiments but I never see good economic basis for them.

The good economic basis I'm talking about is actual market value.

Let's say I have an item in my hand. It could be anything. I'll go with a Beanie Baby. Remember those? Anyway, let's say it cost about a dollar to produce. Wholesale price of two bucks, retail for four.

Now, let's assume that, out of nowhere, this thing I paid four dollars for had a ton of people coming to me offering me $250, because it's a super-rare Janis Joplin Beanie Baby. What's it worth?

To the collectors, it's worth $250. To me, it's worth something different. If I bought it because I knew it would be valuable in the collectors' market, it's worth $250. If I bought it because I wanted a tie-dyed crab, it's worth something different. If I bought it as my newborn child's first toy, chances are it's worth a hell of a lot more than $250 to me, and I'll tell the collectors to fark off.

Well, time passes, and fewer people care about Beanie Babies anymore. Let's say, for the sake of argument, that there are still some collectors who would buy the crab for $200. It has lost 20% of its "value". If I'd sold it, the purchaser has lost $50 on the transaction. If I didn't sell it, because I wanted a tie-dyed crab on my computer desk, or because my kid is now 15 and has it on her desk, then nothing has changed.

So, let's apply this to houses. If I bought a house because I wanted to flip it for profit, it's worth whatever the market says it's worth. If I bought it because I could afford it, and wanted a house in, say, Texas for tax purposes, it's worth something different. If I bought it because it fit my wife's and my view of what our dream home would be, then fark you, buddy, I'm not selling.

Economics isn't just about numbers.

 
DamnYankees [TotalFark] 2009-02-14 07:03:45 PM  
jpo2269: My point is this, if we are going to have a system in place where a homeowner's mortgage would decline when housing values declined, there would be an arguement for mortgages to increase when housing values increased. I think both situations are not good in the longterm.

I really don't see why symmetry is necessary. You can't just assume it is.

 
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