About Reality

Reality

befriend
0 friends
Follow   4,987 comments   Followed by 5   Following 1   Ignored by 8   Ignoring 0   Ignore Reality
Registered Apr 30, 2009


Reality's most recent comments:

  • On Wed, 12 Aug 2015, 2:26pm PDT in Conspiracy! Self Driving Cars And Culling The Human Population, Reality said:

    Self-driving cars, just like cars, railroads, bridges and horse carriages before it, will significantly reduce the cost of transportation, and thereby increase the carry capacity of the planet by increasing trade/exchange/division-of-labor.

    Total miles driven by cars will of course go up, as people will send their cars to do errands that right now would be too costly in terms of time and human labor (if dedicated driver is required). The per mile material cost itself will go down because a self driving car can quickly rack up 300,000 miles in a year like a NYC cab instead of 100k miles in 10 years.

  • On Thu, 6 Aug 2015, 12:13pm PDT in $70,000 minimum salary causing hard times for Seattle CEO, Reality said:

    tatupu70 says

    I not against anyone. Well, I guess I'm against people who post nonsense on pat.net.

    Then you should be against yourself.

    tatupu70 says

    Reality says

    In reality, the rich save by investing! That investment if leveraged creates multiple times the demand that the original cash amount would create!

    With a good portion of their money, yes. The investment doesn't create demand. Demand exists--the investment can help entrepreneurs create products or services that meet the demand that already exists.

    Do you realize that you just proved yourself to be completely ignorant of economics and never even taken Econ 101?! Investment spending of course creates Current Demand. The Output/Return (if any) in the future from current Investment doesn't appear in the Current Demand or Current Supply.

    tatupu70 says

    Reality says

    Lack of after-tax profit opportunity. Why would anyone invest in something that would result in negative after-tax return? thanks to high taxes and cheap money keeping too many competitors in numerous industries living off low interest rate. That's why new money is being poured into SF high tech industry in hopes of a field that might yield high return.

    So, let's recap. You're saying that there actually is lots of demand that isn't being met because there is no cash available to invest in capital to meet this demand.

    Stop lying. I said no such thing. You are trying to put your own nonsense in my mouth. A negative after-tax return means the "Want" does not constitute Qualfied Demand (== defintion of Demand) at all. Let me give you an example: say a Marjuana grower using current technology in a particular location can generate 20% pre-tax profit after capital and labor cost, yet because the federal income tax code doesn't allow deduction of expenses for running a pot growing business and the guy is in the 25% tax bracket. That means the guy is not able to run a pot growing business regardless how much market Want for pot is out there at the current price, and regardless how much money he can borrow. The more he borrows and grows, the more he'd just lose money after tax! He can run a pot growing business and hire people only if:

    1. the effective tax rate is lowered either by lowered rate or by allowing deduction of business expenses;

    2. new technology making pot growing yield higher than 33% in the locality: $75k expenses would yield $100k revenue, and at 25% tax on revenue would leave $75k after-tax, his break-even point, not counting any of his own time and labor.

    3. competitors go out of business and allow prices to go up so that he can generate more than 33% profit

    What I asked how this is possible with interest rates at near all time lows--you respond that it's not actually lack of cash/capital--it's because entrepreneurs can't compete with the existing producers?? Huh? If the current producers are able to produce at lower cost than any new competitors, why is there unmet demand???

    Tax code, regulations, sunk cost, etc. etc. See example above. Artificially low interest rate enable the Ponzi borrowers to stay in business and drag down prices.

    tatupu70 says

    Great non-answer. Actually I do think like a businessman and I understand that there's no reason to invest when there is no unmet demand. And when there is all kinds of excess supply. Funny, I guess supply doesn't create its own demand after all.

    You obviously don't understand what Demand means in economics: Demand means Qualified Demand, which is a Want combined with the Ability to Pay at a Price level that someone can profitably Supply (Qualified Supply). Human Want is unlimited. However, resources are always limited. A factory that turns metal and leather into obsolete Lada cars that are worth less than the original metal and leather are worth does not produce Qualified Supply; however, to the idiots like you, it would be called "excess capacity" for car production.

    The solution for that "excess capacity" is not printing up money to give cars away and waste more metal and leather to keep the Lada factory running, but to dismantle the obsolete factory and liberate the workers to work for more productive factories making more up to date cars.

  • On Thu, 6 Aug 2015, 11:08am PDT in $70,000 minimum salary causing hard times for Seattle CEO, Reality said:

    tatupu70 says

    This is completely incorrect. Basically you are saying there is no cash available for anyone to invest to "cater to current consumer demand". Interest rates are near all time lows. There is literally a sea of cash looking for anything to invest in. What the hell is stopping new entrepreneurs from forming new businesses now???

    Lack of after-tax profit opportunity. Why would anyone invest in something that would result in negative after-tax return? thanks to high taxes and cheap money keeping too many competitors in numerous industries living off low interest rate. That's why new money is being poured into SF high tech industry in hopes of a field that might yield high return.

    Fiat money and/or banks are not stopping this. Nor could they be.

    Only because you are unable to think like a businessman.

home   top   share   link sharer   users   register   best comments   about