patrick.net

We're giving him free room & board, tho. And when he's out of prison, he won't need much money due to his being 78 years old at that point.

zzyzzx says

Liberals are destroying our once great nation with their anti-American agenda. They want to raise taxes, increase welfare, weaken our defenses, and leave our borders open. Liberals want the terrorists to win and are now supporting a Islamist mosque on the hallowed grounds of the Word Trade Center. Liberals are crusading to promote abortion and the gay agenda, while destroying traditional marriage and family values.

I'm a little disappointed. I thought the readers of Pat.net could recognize and understand a strawman argument. Hopefully zz was joking.

It's both. He or she agrees, but must know that it's not what Nomo believes, so he is sort of joking. And obviously he or she has no idea what a bs strawman position is, or at least doesn't recognize it in this case.

But it's not surprising. That was partly Nomo's point right? That there are people that not only say this kind of thing, but they actually believe it.

APOCALYPSEFUCK says

Kevin,
The style I am most familiar with is 4-8 gallons of kerosene poured down the main stairway. Usually takes the roof off. This was the approach by the guys trying to help people out of the early 1970s downturn in one eastern city with which I am familiar...

yes any moron can burn a house to the ground, but it takes someone to know what they are doing to pull it off without an arson investigator picking up on it. The old kerosene poured down the main stairway" trick is the quickest way to get some nice prison time and a denied claim from the insurance company. Now all your left with is a smoking hole in the ground and a couple years in prison.

marcus says

... The insurance proceeds would go to the bank. There is no benefit over walking away, because the “owner” would still owe the mortgagor the amount underwater. And their credit would still be destroyed if they didn’t pay it.
So unless you think banks are going to start resorting to this, I don’t see it happening.

Actually most houses that are properly insured are insured for the replacement cost of the house. So if it's cost more to rebuild the house than it's currently worth on the market, then it's reasonable to expect the insurance company is going to pay more that the current market value of the house. Also part of the insurance premium is for the replacement cost of items inside. For my own house the contents are covered for over 50% of the house coverage. Furniture, clothing, Mom's china, etc are expensive to replace. And if the fire does it job well enough, one pile of burnt furniture or plastic is pretty much like any other pile. So if the high end furniture, designer clothing, and flat screen TV is removed and in it's place you put trash picked furniture, broken TV, good will clothing, etc, after a good fire it's not going to identifiable as such.

So lets look at the figures, House cost 600k (and mortgage note is 600k), contents are insured for 250k, house is now worth 300k on the open market, cost to build another house same size 400k, house burns down, insurance pays off 400k, and 250k for contents, homeowner uses 600k to pay off mortgage note, makes 50K, has his good credit intact, has an empty lot he can sell and has apartment with all his valuables he removed from the house before it burned to the ground. Sounds pretty good to me.

It's important to note that not to strip the house then burn it down, missing furniture, electronics and clothing are not going to leave the same burned debris as stuff that's actually there to get burned.

Wrong.

http://www.ehow.com/facts_6896443_replacement-cost-fire-insurance-policy.html

I never got any request for user data from the FBI, or any other agency. But I suppose the web hosting company could monitor the patrick.net web server without my knowledge, making my wishes irrelevant.

You're right about that, Patrick. The Affiant (officer) writes a search warrant and affidavit, it gets approved by the court and is then served. Most of the time it is for the server and company that has control and custody of the server. Same with phone records.... the warrant is written to include the records from Verizon, ATT or whatever carrier handles the account.

Unless they were looking for something on your personal computer no one would show up knocking on your door. The warrant and affidavit usually lists such things, as IP addresses, billing addresses, payments recieved, service address, all stored electronic communications, email, images, buddy lists, blah, blah, blah as well as old standby and catch-all "and any other files" and "any other information on file."

Nomograph says

I never got any request for user data from the FBI, or any other agency.

You will never receive any such request. Haven’t you heard of ‘warrantless wiretapping’? They get the user data upstream without your permission or knowledge.
If that doesn’t work, they just use the mind ray.

Always the one to point out the simple explanation. Mindrays work under the same theory as do microwaves, digital cameras, and the interwebs... The theory of PFM.

Anyone?

You're a brave man to want to be leveraged like that, but why haven't you just gone down to your local credit union or bank and borrowed against them? With 3 paid for properties I would think any of those institutions would want to loan against them at very attractive rates. On the other hand, it's folks like you that have a lot of risk tolerance that make huge $$$$$ IF it all goes right..........I like my places paid for and unemcumbered so I'm way too conservative for this strategy.

>>three cash flow positive properties paid in full

If they are paid in full, is it not nearly obvious that they would be cash-flow positive? Heck, you could even rent them out for 2% of your purchase price and still be cash flow positive after property tax and some rudimentary maintenance.

justme says

If they are paid in full, is it not nearly obvious that they would be cash-flow positive?

Well, if not, we are lucky to have you here to post it, Captain Obvious. Don't bother to actually post on topic though...

tatupu70 says

justme says

If they are paid in full, is it not nearly obvious that they would be cash-flow positive?

Well, if not, we are lucky to have you here to post it, Captain Obvious. Don’t bother to actually post on topic though…

Apparently it wasn't obvious to the original poster. But then the original poster MAY be a shill for the real-estate-industrial-complex, or maybe someone trying to get a private loan (lender beware) against their property. I don't know, but I did feel like putting the poster on notice that we are not complete fools here at patrick,net, in case s/he was mistaken.

justme says

Apparently it wasn’t obvious to the original poster. But then the original poster MAY be a shill for the real-estate-industrial-complex, or maybe someone trying to get a private loan (lender beware) against their property. I don’t know, but I did feel like putting the poster on notice that we are not complete fools here at patrick,net, in case s/he was mistaken.

Oh, OK. Thank you for defeding pat.net's honor against those evil shills. Again--we are lucky to have you here for fight for us.

tatupu70 says

Oh, OK. Thank you for defeding pat.net’s honor against those evil shills. Again–we are lucky to have you here for fight for us.

Thank you, at your service.

justme does raise an interesting point, tho. the OP was giving us all the necessary info about his properties and asking us what we thought, because we have the best & brightest minds here.

He just wasn't sure if we understood that, if they were paid off, they'd be cash flow positive. so he told us.

Nomograph says

rob918 says
If they are paid in full, is it not nearly obvious that they would be cash-flow positive?
No. He could have vacant lots somewhere that could be borrowed against, but bring in no income.

Huh? That's not my post.

Dude has three properties he came here to ask us Dreamers, sumpin aint right.

I am sure none of the rich would move their money/business offshore

Let them go. We don't need their money . . . we can print more.

As for their "business", if their business is rentierism their absence will improve things.

If you can find a way to force the rich to pay for your big government wet dream then more power to you.

~10 years ago things were in balance. What happened???

Exactly, sumpin aint right.

There's two kinds of people, those doing all of the talking, and those talking about them.

Margaret Thatcher: "The main problem with Socialism is that you always run out of other people's money."

Nomograph says

The only people I’ve *ever* heard arguing for a nanny state are you, Honest Abe, and RayAMerica. All of you have advocated government confiscation of gold and silver, and the installation of a wealth management program run by the federal government.

I've never advocated that, neither has AdHom or Abe. Do you dream this stuff up on your own or are you getting help from those drugs you're on?

RayAmerica says

The problems are solvable, but when you have basically an entire political movement (Dems & Repulicrats) based on taking from the haves and giving to the have nots, it makes it almost impossible to say the least.

Rightly so. If you'll think about it for a second, I'm sure you'll agree. When the country is 5% haves and 95% have nots, how exactly do you propose to cut spending enough to balance a budget? How do you think the economy will perform?

tatupu70 says

When the country is 5% haves and 95% have nots, how exactly do you propose to cut spending enough to balance a budget? How do you think the economy will perform?

Human nature is such that if you simply provide handouts to able bodied people, they will abuse the system. What people like you fail to realize is that there are enormous numbers of people that are lazy and unwilling to do anything other than receive something for nothing. I have personally known people like this. The only people that should receive welfare, etc. are those that are beyond helping themselves. If you made people clean parks, streets, whatever for their entitlements, you would see a huge reduction in applicants.

AdHominem says

It is funny that they label you, me and others as “conservatives,” “neocons,” and even republicans because while we may believe in fiscal responsibility, I gather that neither of us is happy with George Bush or his administration, the ongoing wars and empire building, government intervention into the private lives of citizens (social issues), bailouts, “free trade,” nor do we support idiots like Sarah Palin, or Rush Limbaugh.
I oppose centralization of power, which is something BOTH political parties support. They have and will continue to support centralization of power as long as Democrats and Republicans remain viable political parties.

I agree. Bush was terrible, especially in his last term. Throughout, he was nothing other than an idiot that was controlled by the globalists & Neocons. IMO, Obama is Bush on steroids ... but with better persona ... although more and more are beginning to see him for what he really is; a puppet being controlled by the big central government, Wall Street, Bankster elitists.

RayAmerica says

Human nature is such that if you simply provide handouts to able bodied people, they will abuse the system. What people like you fail to realize is that there are enormous numbers of people that are lazy and unwilling to do anything other than receive something for nothing. I have personally known people like this. The only people that should receive welfare, etc. are those that are beyond helping themselves. If you made people clean parks, streets, whatever for their entitlements, you would see a huge reduction in applicants.

I'm not quite as cynical as you on the American people. I think, by and large, Americans are some of the best people on Earth. It's unfortunate that you have such a poor opinion of your fellow man--perhaps you should move somewhere else where the people are up to your standards.

But, in any event, I'm all for welfare work programs. You realize that it would cost even more money to create and sustain such programs though, right? I didn't know you were for increasing the size of government....

And again--just for the record--I never mentioned welfare. You are the one obsessed with it. I want a strongly progressive tax structure. It's the only way to sustain a middle class and a vibrant economy

Troy says

~10 years ago things were in balance. What happened???

Good question as it relates to the Bay Area. But many are not trying to ask that question or understand/compare anything in a historical context.

tatupu70 says

5% haves and 95% have nots,

Most of these stats are problematic. That top 5% has a higher concentration of their wealth in the tiniest portion of its most affluent members. When you raise taxes on anyone (or any small company) making more than $200k per year, you are hitting the wrong people. The problem is that the tiniest group of well-connected (perhaps the top .0001%) will find a way to make money off of every wealth-distribution or government regulation bill passed. See Obama's financial reform bill or Obama care for examples.

I recently read that our richest Americn family, the Walton's, own as much wealth as the entire bottom 40% of our country. So, the issue isn't tax rates. Its that these super rich get their claws into the government and slant any legislation in their favor. Every time the US government gains more power, so do these aristocrats.

Aiming our class warfare anger at anyone (or any small business) making over $200k is misdirected legislative attention, IMHO. This is, of course, by design.

Thanks Lowlysmartrenter and CBO for your comments.

One idea that worked in the distant past:

In ancient Israel the Israelites understood that land was a finite resource and how valuable it was to have control over it. So they divided the land roughly equally between all the families. Then they let the free market take over (people were free to buy and sell) but at the end of every so many years they had a Jubillee where all the land had to be returned to the original owner (or his descendants) and all debts were forgiven.

This system would be way more productive than simply having government confiscate wealth. Because as Kevin said in another thread idle or misallocated wealth is the bane of an economy. We need to put wealth to work in order maintain prosperity as a nation. Unfortunately most every allocation of funds by the federal government and intervention in markets is either wasteful, unproductive/detrimental to the economy or both.

And as CBO so rightly points out every time government grows in power and funding so do the aristocrats. (by the way it was these same aristocrats who designed the federal reserve system)

CBOEtrader says

I recently read that our richest Americn family, the Walton’s, own as much wealth as the entire bottom 40% of our country. So, the issue isn’t tax rates. Its that these super rich get their claws into the government and slant any legislation in their favor. Every time the US government gains more power, so do these aristocrats.

Why isn't the issue tax rates? You need to get that money back into circulation.

And while I agree that we need to find ways to keep Big Business and the Aristocracy from running our government, I think we probably differ on the solutions...

tatupu70 says

And while I agree that we need to find ways to keep Big Business and the Aristocracy from running our government, I think we probably differ on the solutions…

Lets not forget the other lobbies who have a social engineering/welfare agenda's wasting our tax payer money.

marcus says

Wrong.
http://www.ehow.com/facts_6896443_replacement-cost-fire-insurance-policy.html

http://www.mass.gov/Eoca/docs/doi/Consumer/homeowners_guide.pdf

See Replacement Cost Coverage (on Dwelling)

Basically it says you can insure you house for a Set cash value, market value or Replacement value of your house. While the replacement value may not equal the full 600k you paid for the house, it should cover what it would cost to replace the house if you had to rebuild it from scratch. I would also like to point out that a Bank will require you to maintain an insurance policy that will cover at least the amount of mortgage note they have on the house. So a 600k house that burns to the ground should have sufficient cash value insurance to at least cover the banks mortgage note. It's the insured contents of the property is where most arsonists will make there profits on.

In some US cities in the 1970s arson swept through neighborhoods with declining real estate values, as desperate speculators turned to arson for profit to wrest some value from their investments.

That would have been NYC back then. But who knows if the mob was involved with that.

CBOEtrader: So, the issue isn’t tax rates. Its that these super rich get their claws into the government and slant any legislation in their favor. Every time the US government gains more power, so do these aristocrats.

I agree that the super rich influence the tax rate and I'd take it further by saying the super rich rig our elections and a plethora of legislation, not just laws related to taxation. I would also stipulate that 'super rich' and 'corporation' are synonymous. So I'd have to disagree with that second sentence. As corporations get more wealthy, the government actually loses power. It no longer operates by and for the people as our founders intended, but becomes co-opted by and for the corporation (and despite the wisdom of our Supreme Court, I adamantly deny that corporations are individuals endowed with the same inalienable rights and access to the democratic system).

LowlySmartRenter says

It no longer operates by and for the people as our founders intended, but becomes co-opted by and for the corporation (and despite the wisdom of our Supreme Court, I adamantly deny that corporations are individuals endowed with the same inalienable rights and access to the democratic system).

I completely agree. As the government grows in power, it no longer operates by and for the people. I do believe that the founding fathers witnessed a version of this phenomenon in europe, which is exactly why the constitution's main objective was to limit the size and scope of the federal government.

But yet, you disagree with...
CBOEtrader says

Every time the US government gains more power, so do these aristocrats.

...?

I don't see the difference in what you are saying compared to what I am saying.

The only way I can tell to take power away from these aristocrats is to reinstitute constitutional limits on government--starting with income taxes.

I thought this site and book documents pretty well why things are the way they are:

http://sociology.ucsc.edu/whorulesamerica/

Basically, the very rich hire lobbyists and marketers, and fund "research" to show why they should not be taxed.

Ultimately it's all about control over labor. That's the key point I got out of the book.

"Taxing the rich isn't about ...stealing wealth from people who earned it..." Sure it is, what double talk - government speak - euphemistic term would you call it ? Social engineering?

Why don't you come out of the closet and admit that you are a socialist? Or would you prefer "creeping progressive", or liberal democrat ? It doesn't matter, they're all the same.

I would add that doing something about the graft, fraud, and waste we have in government would be a good idea. You can't just blame the rich, you can't just blame the government either. The poor are also at fault for pipe dreams, thinking one day they too can be rich.

Raising the standard of living for 90% of the population makes a lot of sense to me. The usual arguments of cutting spending and lowering taxes just doesn't hold water, neither does raising taxes and spending more. We need to be smarter about how we tax, how we spend, and how we deliver services.

Bring on the massive overhaul of government and society, I'm ready!

Somewhat misleading since the 2008 program was by design an advance that would be reversed. The article says 4% or so of claims are screwed up, close enough for gob't work.

I'm hoping my experience living in Japan 1992-2000 is indeed the correct intellectual and emotional grounding for the situation we (the middle class) are in now -- just a continuous beatdown that will go on and on, worse and worse.

If it weren't for OUR stupid bubble the Japanese wouldn't even had had their mini-recovery 2003-2007.

wait wait wait .... who figured out how much is enough? Why that amount? Who picked that guy? How much is rich? Why? How much more should rich people pay? why?

I'm pretty much just ribbing you .. but, my questions do point out some of the troubles with liberal based social engineering.

I have pondered this and came up with some basic stuff. In each area of our land it costs $X(A) to live as a middle class citizen. $X is an unknown amount and (A) is the multiplier tied to a particular area. If a study can find what amount is the middle amunt needed for a middle class existance in each area ... wait wait wait ,,, we have to draw the dividing lines first to find these areas .... hmmm ... how will we do that? Why that way? See the problem with this stuff man? The tax code could be - ALL yearly income is taxed 10%. All income over 10 times the national average will be taxed 50% for the amount over 10 times national average.

Bap33 says

wait wait wait …. who figured out how much is enough? Why that amount? Who picked that guy? How much is rich? Why?

The line between middle class and upper class is the difference between return to labor (wages) and return to capital (interest and rents).

I agree that this should be a local thing and not a national level of taxation. If I had my way the state/Federal tax levels would be inverted, ~5% paid to the Feds, ~10% paid to the state, and ~25% paid to the county.

Thing is, compared to that everything is so screwed up that nothing is even in the same ballpark as being optimal.

Btw, the disappearance of the upper middle class tax brackets was accomplished by the Reagan reorganization of 1986, in an effort to insulate the wealthiest and most predatory fortunes from populist confiscation, like what existed 1940-1960-ish.

How much more should rich people pay? why?

I disagree with the general conventional wisdom here that is it necessary to load taxation on the upper class to pay for everyone's way (since I believe the tax bill comes out of rents and land values dollar for dollar).

The problem is that since we undertax the middle and lower classes so much it's hard now to adjust taxation into a more flatter tax system. People's budgets (especially their mortgages) have been set to their existing takehome pay.

This is why we liberals don't mind taxing the upper middle class and upper class more . . . Willie Sutton had it right, unfortunately.

In a better system we'd tax more what we want less of (rentierism) and less what we want more of (labor), but getting there from here is not possible, not in my lifetime at least.