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Be wary of imitating high-status people who can afford to countersignal

robkhenderson.substack.com

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Re: Be wary of imitating high-status people who can afford to countersignal

#201

Post by steveBK123 »

prpl wrote: post #182
steveBK123 wrote: post #105

Earlier quoted context omitted.

Exactly. To me, a $500k unnecessary renovation throws more money away than a $70k vs $40k car. At least with the car you are likely getting safety features and extensive sensor suites for driver assist for the money, that have tangible impact on your driving experience. Or Spending 5-10x on a $10k appliance where a $1-2k one would do. These people tend to get the whole set, so it's a good $30-40k worth of kitchen app…

One slight different is that spending on your home will generally add value to it. It may not be necessary, and you may not get a dollar-for-dollar out of it, but it’s added value nonetheless. I cook a lot, I personally would like a higher quality stove - I’ve killed one before because I (an)use the broiler a lot (it wasn’t terribly old), but I probably would do an NXR or something. maybe in the $2k. Or a used Wolf/v…

I think most people delude themselves that their big renovations added any incremental value to their home. Usually the cost was financed and thus even higher than the sticker price, all-in. Further, the holding periods are measured in a decade +/- often, so the general market moves contribute more to the sales price than whatever you'd done to the kitchen/bath.

On the margin, having a move-in ready home that's been renovated well enough recently enough, generically enough, ensures reasonable liquidity of being able to sell the home for a reasonable price reasonably quickly.

For many this means replacing some dated appliances, repainting, and strategic spending on a few items that may be out of style or more aged, like bathroom vanity or replacing a linoleum top.

Extravagant, expensive, specific renovations may actually detract because the general markets taste are not your taste and so you've either reduced the number of likely buyers, or half the universe of buyers are going to actually deduct value of your renovation because they may want to undo whatever you've done.

Spending $2k replacing a worn appliance or buying a $200 air fryer are two orders of magnitude off from the expenditure levels I am referring to.

Re: Be wary of imitating high-status people who can afford to countersignal

#202

Post by coredog64 »

aix1 wrote: post #180
lotsofpulp wrote: post #154

Earlier quoted context omitted.

However, the Land Cruiser will be passed down for many generations, so the amortized cost of a Land Cruiser is not expensive. Also, Land Cruiser has apparently been discontinued.

> the Land Cruiser will be passed down for many generations Wait, what sort of longevity are we taking about? 15 years? 20? I don't think we humans can reproduce quickly enough for that to span "many generations". :-)

We came close to that with a Camry my mother-in-law owns. She drove it, my sister-in-law drove it for a while, and then they tried to pawn it off on my oldest. At the end of the day, I didn’t want my kid driving a car missing out on 25 years of safety enhancements.

Re: Be wary of imitating high-status people who can afford to countersignal

#203

Post by rvba »

ricardobayes wrote: post #142
mmaunder wrote: post #101

Wealth signaling and its effects are rather depressing. People going into debt to buy a Rolex and a sports car to create the illusion of success is bad enough. Someone falling for an individual mismanaging their own finances to create a lie is quite sad. I was listening to a pop station yesterday and a song was playing that was like a top 5 of fashion brands, they way the singer kept listing them off. So I think elem…

I saw this greatly affecting Eastern European youth, who have mostly no chance of ever wearing Balenciaga or LV. But they get this image blasted 24/7 on Instagram, so they are stuck forever in a sad feedback loop.

In Soviet republics you could be murdered by the state every day, or declared an enemy of the pepople, or sent to gulag for a thing you didnt do - and all of those negative experiences ingrained a type of short-terminism among the society.

The state could take away your apartment and make you lose everyrhing apart the clothes on your back - so why bother fixing the apartment, go and buy some nice clothes... at least you look good NOW and maybe you can keep them.

This negative trainig (easy to lose everything) makes people care more about looks. With so many relatively poor people maybe it is some sort of a "lipstick effect" too - for everyone.

Re: Be wary of imitating high-status people who can afford to countersignal

#204

Post by CyanBird »

ricardobayes wrote: post #142
mmaunder wrote: post #101

Wealth signaling and its effects are rather depressing. People going into debt to buy a Rolex and a sports car to create the illusion of success is bad enough. Someone falling for an individual mismanaging their own finances to create a lie is quite sad. I was listening to a pop station yesterday and a song was playing that was like a top 5 of fashion brands, they way the singer kept listing them off. So I think elem…

I saw this greatly affecting Eastern European youth, who have mostly no chance of ever wearing Balenciaga or LV. But they get this image blasted 24/7 on Instagram, so they are stuck forever in a sad feedback loop.

It happens everywhere, specially around lumpenproletariats around the world, it is a foul situation without an honest fix.

It Latam it leads to horrible levels of asocial behaviors, theft, drug trading to acquire money and use it to purchase luxury items with which signal success

It is heart breaking

Re: Be wary of imitating high-status people who can afford to countersignal

#205

Post by ww520 »

aix1 wrote: post #180
lotsofpulp wrote: post #154

Earlier quoted context omitted.

However, the Land Cruiser will be passed down for many generations, so the amortized cost of a Land Cruiser is not expensive. Also, Land Cruiser has apparently been discontinued.

> the Land Cruiser will be passed down for many generations Wait, what sort of longevity are we taking about? 15 years? 20? I don't think we humans can reproduce quickly enough for that to span "many generations". :-)

That sounds like a response from a Large Language Model.

Re: Be wary of imitating high-status people who can afford to countersignal

#206

Post by CyanBird »

wellbehaved wrote: post #189
speakfreely wrote: post #157

Earlier quoted context omitted.

Would love to set a 10 year reminder to check in on how this life strategy has worked out.

Yeah. Look where this got Galileo. House arrest for the rest of his life. Bad call Galileo, you should have paid better attention to social cues! /s

Well... Copernicus did take a cue, he wrote his book and ideas and only published them when he was about to die (or postmortem I don't remember/can't lookup the details rn)

Re: Be wary of imitating high-status people who can afford to countersignal

#207

Post by doliveira »

lullab wrote: post #42
TrackerFF wrote: post #27

Maybe a bit OT: The other day I read an interview with a local guy in his 20s that struck gold with crypto, he'd invest something like $20k, and turned it into $40M. He basically went all in on one alt-coin before the marked exploded late last year, and the coin went up 2000x. When asked about it, he of course came up with a narrative that this wasn't just dumb luck. He had had worked hard for those $20k, and he had…

Maybe the real takeaway from his story is to bet big in a new market to get rich. And if you lose it all, earn more and do it again. It would have happened in the early days of the internet just the same. Yes, it's incredibly risky but at least it has a better chance than playing the lottery. Like Nassim Taleb says, bet on things with a limited downside and unlimited upside. And if you don't try, nothing will happen.

That's a pretty big advantage rich people have as well: knowing they won't starve to death if they fail.

Re: Be wary of imitating high-status people who can afford to countersignal

#208

Post by taeric »

yodsanklai wrote: post #174
ChrisMarshallNY wrote: post #145

> In contrast, children will copy every single action, including the unnecessary ones. The example that immediately springs to mind, in the tech industry, is the "Steve Jobs Asshole" archetype. Steve Jobs was a notorious manager, in that he made heavy-duty demands, did not suffer fools, and was blunt to the point of abusive. But he was also able to filter for talent, cultivate it, and encourage excellence. He wasn't…

There's no excuse to tolerate bad behavior. It's like an abusive relationship. When such a situation happens, you should start thinking of an exit plan ASAP.

There are also shockingly few areas where zero tolerance works. That is, don't silently tolerate bad behavior, but realize that many punishment oriented corrections are themselves bad behavior.

Re: Be wary of imitating high-status people who can afford to countersignal

#209

Post by steveBK123 »

billjings wrote: post #188
steveBK123 wrote: post #64

Earlier quoted context omitted.

Fair point. My numbers are probably off on everything now. Before the 2020s era inflation you could definitely pick up a mens one used for $2k, like a Datejust model for example. Likewise a $70k car is neither particularly rare or exotic now with how much the average car price has been pushed up by big trucks and EVs.

"2020s era inflation" started just this year. And it's, what, 11%?

Well its nearly 2023, and we have had 10%-ish inflation going on about 2 years.

In specific areas such as cars, you had complete dislocations. For example used cars which normally depreciate 15-20%/year, instead inflated about 15%/year for 2 years.

Over the summer I traded in a 4 year old car at the end of its warranty of 85% of what I paid for it new. I probably could have sold private party and haggled harder to get closer to 90%+ Normally 85% is what you can expect to sell your car for right after you drive it off the lot on your second day of ownership.

This was a knock on effect of new car production shortages, and pent up demand from low 2020 sales and people having a lot of cash on hand.

Related to this you had dealers adding market (ADM) on not even luxury/exotic vehicles of $10-15k in some areas. So never mind not being able to negotiate a few $1000 off, people were paying sticker+$15k for new vehicles for the privilege of being able to buy one. And this was on top of the sticker prices ticking up over the course of the pandemic and related inflation.

So no, for many things, it was not "just a year of 11% inflation".

Re: Be wary of imitating high-status people who can afford to countersignal

#210

Post by PaulHoule »

steveBK123 wrote: post #87
helen___keller wrote: post #70

Earlier quoted context omitted.

> wearing a $2k Rolex or driving a $70k BMW is frowned upon. But instead they have eccentric "hobbies" requiring $10ks of of equipment, inclusive of "needing" $10k viking stove/range, and $10k subzero fridge/freezer in your kitchen because you are a "foodie" […] Isn’t this conflating status signal with lifestyle? The wealthy have always enjoyed expensive lifestyles and hobbies. In and of itself, expensive hobby equip…

For example I would contrast the following three scenarios of people in my circle. * Having professional landscapers plant grass and plants on an outdoor terrace of a penthouse apartment for $100k * Growing a large vegetable garden from seeds & seedlings, from your vacation home outside the city * Raising houseplants in your apartment windowsill All three of these people may describe themselves as having green thumbs…

I am into collecting slightly obsolete audio gear, I've spent maybe $600 on the hobby in the last six months.

I know some people would think $120 is a lot for a minidisc player since you can get a flash player for so much less. Other people would think it's a trivial amount of money. Like all these things it comes in multiple scales: back in the day there were people who would spend 50x that on audio gear (there are some $20,000 speaker sets that sound great)

I don't expect to impress anybody: the last person I showed my portable minidisc player was a professor in the music department who's won one more than one Grammy award and teaches sound engineering who I ran into at the bus stop and his comment is "God, how can you listen to something compressed like that?" ("... yeah, I've been wondering about some of the coding tools they use.")

We are probably going to have some people over for a party and I don't expect many people to notice the difference with the 5.1 DTS discs I have in my CD changer but I do.

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