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Basic income plan clearly rejected by Swiss voters

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Re: Basic income plan clearly rejected by Swiss voters

#441

Post by vasilipupkin »

bane wrote: post #344
vasilipupkin wrote: post #185

Earlier quoted context omitted.

Exactly. You are either renting the money or the house. You might as well put your equity into a diversified mutual fund. However, there are massive nonfinancial benefits of owning a home, don't forget

Assuming you can rent or buy an equivalent property, in most markets, the monthly outlay is approximately the same. There's very few circumstances where a renter has such an excess of money that they could make any meaningful gains off of alternative investments. Over time this changes, assuming the renter and the owner have incomes that increase, rent also increases on the same property over time (usually on about p…

You are forgetting that your down payment ( and equity )is tied up in the house, when it could be invested elsewhere.

Re: Basic income plan clearly rejected by Swiss voters

#442

Post by RobertKerans »

alva wrote: post #57
_nalply wrote: post #7

Earlier quoted context omitted.

The downside are populistic decisions like the Swiss minaret referendum. Now we have the sentence «The construction of minarets is prohibited.» in the constitution. ( https://www.admin.ch/opc/en/classified-compilation/19995395/... ) I think such regulations should be decreed as a law and not as a constitution norm if at all. But if everybody has a say you get bikeshedding in the constitution.

Out of interest, why is populistic commonly used as a pejorative? It seems to be the best friend of democracy.

Dictatorships tend to be populist. Theocracies tend to be populist. For example, the Islamic regime is highly populist. Chavez was populist. Golden Dawn is populist. Nigel Farage, Marie le Pen are populist politicians. Etc etc.

It might demonstrate that ~50% of the population currently agrees with the current message of a person or group of people

Re: Basic income plan clearly rejected by Swiss voters

#443

Post by DominikR »

mwfunk wrote: post #423
DominikR wrote: post #376

Earlier quoted context omitted.

It would be a visible symbol that Islam is part of mainstream culture which it is not. It is part of other cultures and these cultures have very different views on social norms and order, laws and politics.

If you incorporate tribalism into a national constitution, all it does is amplify tribalism in society. Whatever social problems exist between unassimilated immigrants and locals will get worse, not better. A constitution is probably the single least constructive place possible in which to wage culture wars. It should be steering the country towards helping different cultures coexist, not feeding into both the xenoph…

I tend to agree that the constitution is the wrong place, it should probably be a law.

But this has nothing to do with xenophobia, it's about the social order and norms that we have and that we will have in the future.

I like the freedoms I have and I don't want to give them up, neither do I want the Muslim living in Europe to give up his. Everyone can practice their religion and have their political views but with time they or their next generation will tend to assimilate, it's only natural.

I believe that allowing immigrants to remodel our society and culture in any way they desire will not have the effect that we'll merge and solve cultural issues. Instead they will build and create according to their own culture (which is also natural), live among themselves concentrated in some parts of the cities which will then turn into ghettos with high unemployment and this would in turn create radicalism on both sides.

There are already districts in some German cities where ethnic Germans are at risk if they enter. To me, this is clearly not the way to go.

Re: Basic income plan clearly rejected by Swiss voters

#444

Post by misja111 »

s3nnyy wrote: post #82
mhb wrote: post #75

Earlier quoted context omitted.

The price of food in Switzerland was insane when I was there.

If you're referring to restaurants, that is because the waitress makes around 4000 CHF per month; if you're referring to food in supermarket that is because the clerk behind the counter gets 25 CHF / hour and not 7 EUR like in Germany.

Not only that, but Switzerland puts import fees on quite a number of food items. For instance, Swiss meat farmers are heavily protected, and that shows when you check the prices for meat in the supermarket or in a restaurant. A steak can cost three times as much as over the border in Germany.

Re: Basic income plan clearly rejected by Swiss voters

#445

Post by RobertKerans »

areyoucrazy wrote: post #88
alva wrote: post #57

Earlier quoted context omitted.

Out of interest, why is populistic commonly used as a pejorative? It seems to be the best friend of democracy.

It's used in a negative sense when liberals don't like the outcome of a direct democratic decision.

And also every other political group, in any situation. And, in this context, eg the dangers of pure democracy, almost every political thinker that's ever existed.

Re: Basic income plan clearly rejected by Swiss voters

#446

Post by soyiuz »

bane wrote: post #316
soyiuz wrote: post #244

Earlier quoted context omitted.

Re: renting is wasting money. Think of the math this way. A $1mil condo in New York generates approximately 45k/yr income, or 4.5% return on investment per year in rents. Subtract taxes and amortization and ask yourself, can you get similar returns elsewhere? You could for example purchase an index fund with the same $1mil and contribute the gains towards rent. Either way you are living "for free." It is however risk…

To make your plan work, you'd have to have around $1mil in investment dollars that you'd place into various investments to make the "free" rent money. Since you're relying on those investments to provide shelter, they're just as illiquid as owning property (except with property you can make money off of it). The best plan here is to keep $800k in investments, move to rural nowhere and buy a huge house for $200k cash…

The amount is irrelevant, since you are making the same percentage on whatever sum investment. I think you are using a non-technical definition of liquidity: I can convert ETFs or stocks into cash almost immediately. So for example, it is easy to scale down or to move money from stocks to bonds. The house is immovable property in all senses of the word. It is difficult to convert to cash or to move (in case of political upheaval, for example).

Your last point ignores the significant costs associated with 1. amortization and 2. the liquidity problem. First, given a neutral market, the house decays in value: appliances need fixing, floors, heaters, boilers etc. We are just used to rising prices due to speculation, but nothing guarantees the upward trend. Second, consider the cost of converting cash into house and the other way around: mortgage fees, interest, buying and selling fees, plus real estate taxes.

The New York Times has an excellent calculator on buying vs. renting. The math just does not support your conclusions. Buying wins out after 10-15 years GIVEN an upward real estate market. With any downturns, renting wins out indefinitely. Include the risk of investing into a single instrument (all you money is in the house) plus the stresses of ownership (shit goes wrong all the time and costs you money) and the picture is not so clear at all.

Re: Basic income plan clearly rejected by Swiss voters

#447

Post by soyiuz »

bane wrote: post #318
rs999gti wrote: post #175

Earlier quoted context omitted.

> waste money on renting How is renting wasting money? Are you not living in the unit? You're gaining 100% benefit by paying rent and receiving a roof over your head. You must mean a waste by losing out on building equity? That's a crap shoot in itself. A hot housing market and equity can go into the toilet at anytime due to very irrational market conditions. Look at the housing markets of Las Vegas or Miami for exam…

It's very simple, even outside of equity earning and the ups and downs of the housing market, once you pay off your mortgage, you now have a place to live that's fairly close to free (other than maintenance, utilities and taxes). If your home is large enough, you can even turn it into a revenue generating asset by renting out portions or all of it. Rents also tend to go up with inflation, once you enter into a mortga…

See my post above. Once you pay off the mortgage it is equivalent to paying yourself out a percentage of cash investment. In NYC that number is approximately 4.5%. That is pretty good but not great considering the risks of ownership.

Re: Basic income plan clearly rejected by Swiss voters

#448

Post by soyiuz »

defen wrote: post #319
soyiuz wrote: post #244

Earlier quoted context omitted.

Re: renting is wasting money. Think of the math this way. A $1mil condo in New York generates approximately 45k/yr income, or 4.5% return on investment per year in rents. Subtract taxes and amortization and ask yourself, can you get similar returns elsewhere? You could for example purchase an index fund with the same $1mil and contribute the gains towards rent. Either way you are living "for free." It is however risk…

A person with $1 million available to put into an index fund is the 1%, and advice for them is not really applicable to the general population. For "normal" people, buying a house can be a good idea because you can deduct the interest from your income. It also gives you much more stability in terms of monthly housing payments if you get a fixed-rate mortgage (unless rent control is an option). Finally, you also "get…

See above. The amount is irrelevant. Deducting interest is good. However, you must take into account the costs of amortization, real estate taxes, and the costs of borrowing money. Check the NYT calculator. Owning wins out in an up market and only after a decade or so. It is much more difficult the absorb the costs of real estate transaction for those not in the top 1%. Rental is a reasonable financial strategy for any income bracket.

Re: Basic income plan clearly rejected by Swiss voters

#449

Post by soyiuz »

seanp2k2 wrote: post #429
nemo44x wrote: post #366

Earlier quoted context omitted.

I was waiting for someone to mention that. Home ownership is expensive and makes you inflexible. Also, consider property taxes (which will scale with inflation) and the fact home owners insurance is more expensive than renters. And besides finance you need to consider if you want the responsibility of owning a home. Cutting the grass, shoveling snow, cleaning gutters, fixing things, painting, etc. It's a lot of work.…

Another counter-point: when you buy a house, even while the mortgage isn't paid off, you can immediately start renting parts of it and end up in a situation where your mortgage payments are equaled or exceeded by your rental income. I also believe that this is taxed differently from normal income, especially so if you're renting rooms in a house you live in vs. owning rental property. In the Bay Area at least, a sing…

Landlording poses significant risks which you also must take into account. Thus if your net worth is 500k and all of it is in a rental unit, what happens if your renter floods the house or damages it in some other way?

What happens when your renter quits paying rent and starts legal proceedings based on a grievance, real or perceived? Now you cannot sell the house nor are you collecting rents.

Lastly see my other comments. Any investment that pays dividends gives you a place to sleep. The fact that you live in your investment is uniformly a downside, as it hinders liquidity. The fact that you can rent is again not relevant. Most financial investments begin to return a percentage immediately. Renting rooms is just less liquid and more risky than investing in a balanced portfolio.

Re: Basic income plan clearly rejected by Swiss voters

#450

Post by soyiuz »

bane wrote: post #327
tunap wrote: post #262

Earlier quoted context omitted.

Do not forget maintenance, insurance & taxes that go along with that monthly nut. People used to always tell me I was throwing my money away on rent(until the "Great Recovery"), but I've never had to pony up thousands of $$$ for a new a/c unit or replacement appliances. As always, YMMV.

Why do you think your rent isn't simply amortizing those costs? The landlord isn't a utility/maintenance charity.

Many cities place artificial constraints on rent increases, for example which prevents full amortization.
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