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You’ve just stated that you choose to rent. Your landlord is thus providing a service you value (adding to the economy). You are providing a service your tenan

You’ve just stated that you choose to rent. Your landlord is thus providing a service you value (adding to the economy). You are providing a service your tenants value. In your case, this may be mostly the assumption of risk - what if your tenants stop paying, and the government says you can’t evict? What if rental prices drop dramatically? Or real estate prices drop dramatically? What if your tenants move out and it takes X months to rent? You are still on the hook for your payments to the bank, and your equity and credit rating are at risk. The bank lending you capital in exchange for interest (rent) is also providing you a valuable service - and you are providing a valuable service to them, giving them a return on their capital (with an acceptable risk of default). That’s the “invisible hand” of free market exchanges - each party gives what they value less to obtain what they value more, so both parties are better off (if they didn’t feel themselves to be better off, they would not make the exchange).

neonological 6y ago
> You’ve just stated that you choose to rent. Your landlord is thus providing a service you value (adding to the economy). The land existed before my landlord was alive. It's the equivalent of charging me to breath air because someone owns it. >You are providing a service your tenants value. In your case, this may be mostly the assumption of risk - what if your tenants stop paying, and the government says you can’t evict? What if rental prices drop dramatically? Or real estate prices drop dramatically? What if your tenants move out and it takes X months to rent? Sure you could say that I take on the risk, but that's also dependent on data. Historically for the last century the risk is highly minimal. I could also, If I wanted pay off the entire loan. Then there would be no risk. It would essentially become the economic equivalent of me charging people for breathing air that I own. >You are still on the hook for your payments to the bank, and your equity and credit rating are at risk. I can afford to pay on my own. Additionally I can sell the property at anytime as well. Of course there is still risk in depreciation but I already know the risk is minimal based off data. >The bank lending you capital in exchange for interest (rent) is also providing you a valuable service - and you are providing a valuable service to them, giving them a return on their capital (with an acceptable risk of default). Yeah, a service in exchange for what? For interest. Interest that I don't pay for. The exchange is more between the tenants and the bank and I function as a middle man leaching from the tenants. It is their blood sweat and tears that will be fronting the loan and the house that I will own. >That’s the “invisible hand” of free market exchanges - each party gives what they value less to obtain what they value more, so both parties are better off (if they didn’t feel themselves to be better off, they would not make the exchange). The invisible hand is an outdated concept. The world has moved beyond Adam Smith as the data shows that economic systems are far more complicated. The current status quo belief argues that the average return on investment outpaces productivity-based income by a wide margin. So basically not only does owning property allow me to gain money from it without an ounce of work. But investments on all forms of capital from property to human capital is responsible for much of the wealth inequality that exists today. Such capital ownership allows people to have incomes that far exceed what any one human individual is capable of generating through productive labor.
- kbutler 6y ago
  Middlemen get a bad rap, because people don't see that they are providing a valuable service. Your financial resources make the risk acceptable to you. It's probably less acceptable to your tenants. In the same way, you choose to keep your capital and not commit it to your own housing, even though your landlord is also benefiting from that relationship. If your landlord is not providing you a valuable service, cut him out. Vertical integration is a time-proven way to remove middlemen that don't add value. The fact you are aware of the alternatives and that they are easy and yet you choose to continue paying rent shows it is valuable to you. We all have incomes that far exceed one person's labor, because of the benefits of specialization and free exchange, which are still fundamental to economics. The stored surplus is capital, which further magnifies productivity, and is necessary for any modern lifestyle - without it, we'd be a lot more equal, but it would be the equality of hunter-gatherers. Those middlemen and providers of capital are why you and your tenants can rent homes, in a city, working desk jobs, and eating turkey sandwiches on demand for $10 instead of $1500 and six months of labor. https://youtube.com/playlist?list=PLLXfVEsLI-qSO5XzEa0pOJyXlNVZJBupK https://youtube.com/playlist?list=PLLXfVEsLI-qSO5XzEa0pOJyXl...
  - neonological 6y ago
    >Your financial resources make the risk acceptable to you. It's probably less acceptable to your tenants. In the same way, you choose to keep your capital and not commit it to your own housing, even though your landlord is also benefiting from that relationship. No I told you the risk is nothing. I just have capital to make a down payment that's it. Additionally risk isn't an economic product. How risky something is does not contribute extra GDP to the economy. Only productive work contributes to the economy. >If your landlord is not providing you a valuable service, cut him out. Vertical integration is a time-proven way to remove middlemen that don't add value. The fact you are aware of the alternatives and that they are easy and yet you choose to continue paying rent shows it is valuable to you. It is valuable to me. Your statement proves nothing. It's similar to how air is valuable to me. Take the concept of property ownership and place it on air. Now I have to pay some owner of air money because he is providing me a valuable service of letting me breath his air? I'm not providing a "service" to anyone anymore than a hypothetical owner of oxygen is providing a "service" to let people breath. >We all have incomes that far exceed one person's labor, because of the benefits of specialization and free exchange, which are still fundamental to economics. The stored surplus is capital, which further magnifies productivity, and is necessary for any modern lifestyle - without it, we'd be a lot more equal, but it would be the equality of hunter-gatherers. No we don't. I'm not talking about income from manual labor of one hunter gatherer. I'm talking about the average possible income one man can make without hiring any employees or investing in capital in a modern economy. I thought this was obvious, guess not. Many people make less than this, many people make significantly more. The people who make significantly more tend to have had hired human capital to produce output equivalent to multitudes of people. >If your landlord is not providing you a valuable service, cut him out. Vertical integration is a time-proven way to remove middlemen that don't add value. The fact you are aware of the alternatives and that they are easy and yet you choose to continue paying rent shows it is valuable to you. No it's not. Dude. By middleman I'm not talking about some hustler who connects two potential clients together or fronts some kind of risk. I'm talking about people who are sitting on tons of investment capital and just living off the growth of that capital by doing Zero work. Warren Buffet invests in low low risk companies and profits off the growth of these investments by doing no work. Literally if warren buffet didn't exist the world wouldn't really change... If Elon Musk didn't exist on the other hand, the space industry and automobile industry would be very different. Warren Buffet by owning a bunch of stock from a lot of companies isn't contributing anything to the economy. No services, no risk, no nothing. He's just benefiting from the growth of others peoples' work. Both of these people benefit from human capital but warren is the more apt example because he doesn't even contribute anything to the investments he owns. He's just a stock picker. Whatever you think about the economy this much is real: It's already officially known that the wealth inequality is the result of income from capital growing faster than income from productive labor. It's free money in every sense of the word. And because productive capital is the basis of an economy what you get is wealth inequality.

neonological 6y ago

> You’ve just stated that you choose to rent. Your landlord is thus providing a service you value (adding to the economy). The land existed before my landlord was alive. It's the equivalent of charging me to breath air because someone owns it. >You are providing a service your tenants value. In your case, this may be mostly the assumption of risk - what if your tenants stop paying, and the government says you can’t evict? What if rental prices drop dramatically? Or real estate prices drop dramatically? What if your tenants move out and it takes X months to rent? Sure you could say that I take on the risk, but that's also dependent on data. Historically for the last century the risk is highly minimal. I could also, If I wanted pay off the entire loan. Then there would be no risk. It would essentially become the economic equivalent of me charging people for breathing air that I own. >You are still on the hook for your payments to the bank, and your equity and credit rating are at risk. I can afford to pay on my own. Additionally I can sell the property at anytime as well. Of course there is still risk in depreciation but I already know the risk is minimal based off data. >The bank lending you capital in exchange for interest (rent) is also providing you a valuable service - and you are providing a valuable service to them, giving them a return on their capital (with an acceptable risk of default). Yeah, a service in exchange for what? For interest. Interest that I don't pay for. The exchange is more between the tenants and the bank and I function as a middle man leaching from the tenants. It is their blood sweat and tears that will be fronting the loan and the house that I will own. >That’s the “invisible hand” of free market exchanges - each party gives what they value less to obtain what they value more, so both parties are better off (if they didn’t feel themselves to be better off, they would not make the exchange). The invisible hand is an outdated concept. The world has moved beyond Adam Smith as the data shows that economic systems are far more complicated. The current status quo belief argues that the average return on investment outpaces productivity-based income by a wide margin. So basically not only does owning property allow me to gain money from it without an ounce of work. But investments on all forms of capital from property to human capital is responsible for much of the wealth inequality that exists today. Such capital ownership allows people to have incomes that far exceed what any one human individual is capable of generating through productive labor.

kbutler 6y ago
Middlemen get a bad rap, because people don't see that they are providing a valuable service. Your financial resources make the risk acceptable to you. It's probably less acceptable to your tenants. In the same way, you choose to keep your capital and not commit it to your own housing, even though your landlord is also benefiting from that relationship. If your landlord is not providing you a valuable service, cut him out. Vertical integration is a time-proven way to remove middlemen that don't add value. The fact you are aware of the alternatives and that they are easy and yet you choose to continue paying rent shows it is valuable to you. We all have incomes that far exceed one person's labor, because of the benefits of specialization and free exchange, which are still fundamental to economics. The stored surplus is capital, which further magnifies productivity, and is necessary for any modern lifestyle - without it, we'd be a lot more equal, but it would be the equality of hunter-gatherers. Those middlemen and providers of capital are why you and your tenants can rent homes, in a city, working desk jobs, and eating turkey sandwiches on demand for $10 instead of $1500 and six months of labor. https://youtube.com/playlist?list=PLLXfVEsLI-qSO5XzEa0pOJyXlNVZJBupK https://youtube.com/playlist?list=PLLXfVEsLI-qSO5XzEa0pOJyXl...
- neonological 6y ago
  >Your financial resources make the risk acceptable to you. It's probably less acceptable to your tenants. In the same way, you choose to keep your capital and not commit it to your own housing, even though your landlord is also benefiting from that relationship. No I told you the risk is nothing. I just have capital to make a down payment that's it. Additionally risk isn't an economic product. How risky something is does not contribute extra GDP to the economy. Only productive work contributes to the economy. >If your landlord is not providing you a valuable service, cut him out. Vertical integration is a time-proven way to remove middlemen that don't add value. The fact you are aware of the alternatives and that they are easy and yet you choose to continue paying rent shows it is valuable to you. It is valuable to me. Your statement proves nothing. It's similar to how air is valuable to me. Take the concept of property ownership and place it on air. Now I have to pay some owner of air money because he is providing me a valuable service of letting me breath his air? I'm not providing a "service" to anyone anymore than a hypothetical owner of oxygen is providing a "service" to let people breath. >We all have incomes that far exceed one person's labor, because of the benefits of specialization and free exchange, which are still fundamental to economics. The stored surplus is capital, which further magnifies productivity, and is necessary for any modern lifestyle - without it, we'd be a lot more equal, but it would be the equality of hunter-gatherers. No we don't. I'm not talking about income from manual labor of one hunter gatherer. I'm talking about the average possible income one man can make without hiring any employees or investing in capital in a modern economy. I thought this was obvious, guess not. Many people make less than this, many people make significantly more. The people who make significantly more tend to have had hired human capital to produce output equivalent to multitudes of people. >If your landlord is not providing you a valuable service, cut him out. Vertical integration is a time-proven way to remove middlemen that don't add value. The fact you are aware of the alternatives and that they are easy and yet you choose to continue paying rent shows it is valuable to you. No it's not. Dude. By middleman I'm not talking about some hustler who connects two potential clients together or fronts some kind of risk. I'm talking about people who are sitting on tons of investment capital and just living off the growth of that capital by doing Zero work. Warren Buffet invests in low low risk companies and profits off the growth of these investments by doing no work. Literally if warren buffet didn't exist the world wouldn't really change... If Elon Musk didn't exist on the other hand, the space industry and automobile industry would be very different. Warren Buffet by owning a bunch of stock from a lot of companies isn't contributing anything to the economy. No services, no risk, no nothing. He's just benefiting from the growth of others peoples' work. Both of these people benefit from human capital but warren is the more apt example because he doesn't even contribute anything to the investments he owns. He's just a stock picker. Whatever you think about the economy this much is real: It's already officially known that the wealth inequality is the result of income from capital growing faster than income from productive labor. It's free money in every sense of the word. And because productive capital is the basis of an economy what you get is wealth inequality.