7 ms·

Since housing is an emotional subject, let's try to argue by analogy. I regularly buy lots of dairy products. Milk, yogurt, cheese. Why shouldn't I save some m

Since housing is an emotional subject, let's try to argue by analogy. I regularly buy lots of dairy products. Milk, yogurt, cheese. Why shouldn't I save some money and buy myself a cow instead? That way, I could satisfy all my dairy needs, and maybe even have some extra milk to sell to my neighbors. No more making the dairy farmers rich at my expense. Now, assume that I sell my cow ten years later. And let's say that cattle prices grow 3% annually. (As we all know, cattle prices can only go up.) Will my cow investment yield me a 3% annual profit, given that my cow has gotten older and I must have made significant investments to feed it and keep it healthy?

IshKebab 9y ago
A cow is not the same as a freehold property. Land does not age (except maybe near the sea), and houses generally last a very long time.
- piracy1 9y ago
  Also, running a dairy farm requires some economy of scale that renting a house doesn't
  - bluGill 9y ago
    If you have enough land for the cow to eat grass (note we are carefully not counting the cost of this land) you can milk the cow by hand: the only equipment needed is what you probably already have in your kitchen anyway, and a few bottles of "cow lotions" (some are cleaners but in any case cheap). Running a dairy farm with 3000 cows has a lot of economy of scale but that is mostly time. And happy cows - cows much prefer their comfortable barn year round to being outside in the weather.
- thaumasiotes 9y ago
  > Land does not age Tell it to the pastoral nomads who used to live in what is now the Sahara.
chrisseaton 9y ago
So what are you arguing? You’ve just posed exactly the same questions we already had but in a cow theme.
- deleted 9y ago
  [deleted]
- _Tev 9y ago
  He is arguing that it is not clear that "buying cow is obviously better". Because many people really do argue like that when it comes to rent vs. buy.
  - emodendroket 9y ago
    The analogy seems obviously flawed. You can get the world's best cow and give it the world's highest standard of care but there's no way it's going to live over 100 years. Additionally, while I don't want to downplay home maintenance, I don't think it's as big a responsibility as taking care of and regularly milking a cow. And it's not like you might have a week here and there where you don't really need lodging.
    - _Tev 9y ago
      Actually you perfectly illustrated why it's in fact great analogy - nobody listens to other side's argument, everyone is "obviously right". Or other side's arguments "obviously flawed".
known 9y ago
Mr Gates said: "These chickens are multiplying on an ongoing basis so there's no investment that has a return percentage anything like being able to breed chickens." http://www.bbc.com/news/world-africa-36487536 http://www.bbc.com/news/world-africa-36487536
dlp211 9y ago
This analogy is not correct. The correct analogy is renting a cow vs owning a cow, not owning a cow versus purchasing it's by product.
mikekchar 9y ago
Not really related, but I'll bet most people don't know that in many places you can by a "cow share". Basically you buy a percentage of the cow's output for the rest of its life. The farmer milks it, takes care of it and gives you the milk. In some places it is illegal, but in other places it's the easiest way to get raw milk (which may be important if you make your own cheese, among other things). In this kind of arrangement, it's a derisking tool for the farmer. The share holder is paying upfront for the cow (and possibly even for maintenance). For the share holder it's a way to lock in availability (more than price) of a difficult to get resource. There are similar arrangements for things like hops in homebrewing. Some big clubs will essentially buy futures for hops in order to lock in availability and price for really hard to get hops. In this case it can really pay off because the price can skyrocket (multiples) if a particular hop because suddenly popular one year.
pjc50 9y ago
Usually before those 10 years are up you would have eaten the cow due to declining milk production. Whereas, in large areas of the West, a house will have gone up in value over that time. Unless there's a systemic crisis. https://www.globalpropertyguide.com/Europe/United-Kingdom/price-change-10-years https://www.globalpropertyguide.com/Europe/United-Kingdom/pr... : note that 10 years ago was the very end point of the housing boom which is why Ireland and Spain look so bad on this chart.

IshKebab 9y ago

A cow is not the same as a freehold property. Land does not age (except maybe near the sea), and houses generally last a very long time.

piracy1 9y ago
Also, running a dairy farm requires some economy of scale that renting a house doesn't
- bluGill 9y ago
  If you have enough land for the cow to eat grass (note we are carefully not counting the cost of this land) you can milk the cow by hand: the only equipment needed is what you probably already have in your kitchen anyway, and a few bottles of "cow lotions" (some are cleaners but in any case cheap). Running a dairy farm with 3000 cows has a lot of economy of scale but that is mostly time. And happy cows - cows much prefer their comfortable barn year round to being outside in the weather.
thaumasiotes 9y ago
> Land does not age Tell it to the pastoral nomads who used to live in what is now the Sahara.

chrisseaton 9y ago

So what are you arguing? You’ve just posed exactly the same questions we already had but in a cow theme.

deleted 9y ago
[deleted]
_Tev 9y ago
He is arguing that it is not clear that "buying cow is obviously better". Because many people really do argue like that when it comes to rent vs. buy.
- emodendroket 9y ago
  The analogy seems obviously flawed. You can get the world's best cow and give it the world's highest standard of care but there's no way it's going to live over 100 years. Additionally, while I don't want to downplay home maintenance, I don't think it's as big a responsibility as taking care of and regularly milking a cow. And it's not like you might have a week here and there where you don't really need lodging.
  - _Tev 9y ago
    Actually you perfectly illustrated why it's in fact great analogy - nobody listens to other side's argument, everyone is "obviously right". Or other side's arguments "obviously flawed".

known 9y ago

Mr Gates said: "These chickens are multiplying on an ongoing basis so there's no investment that has a return percentage anything like being able to breed chickens." http://www.bbc.com/news/world-africa-36487536 http://www.bbc.com/news/world-africa-36487536

dlp211 9y ago

This analogy is not correct. The correct analogy is renting a cow vs owning a cow, not owning a cow versus purchasing it's by product.

mikekchar 9y ago

Not really related, but I'll bet most people don't know that in many places you can by a "cow share". Basically you buy a percentage of the cow's output for the rest of its life. The farmer milks it, takes care of it and gives you the milk. In some places it is illegal, but in other places it's the easiest way to get raw milk (which may be important if you make your own cheese, among other things). In this kind of arrangement, it's a derisking tool for the farmer. The share holder is paying upfront for the cow (and possibly even for maintenance). For the share holder it's a way to lock in availability (more than price) of a difficult to get resource. There are similar arrangements for things like hops in homebrewing. Some big clubs will essentially buy futures for hops in order to lock in availability and price for really hard to get hops. In this case it can really pay off because the price can skyrocket (multiples) if a particular hop because suddenly popular one year.

pjc50 9y ago

Usually before those 10 years are up you would have eaten the cow due to declining milk production. Whereas, in large areas of the West, a house will have gone up in value over that time. Unless there's a systemic crisis. https://www.globalpropertyguide.com/Europe/United-Kingdom/price-change-10-years https://www.globalpropertyguide.com/Europe/United-Kingdom/pr... : note that 10 years ago was the very end point of the housing boom which is why Ireland and Spain look so bad on this chart.