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Buy payphones and retire

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111–120 of 365 posts

Re: Buy payphones and retire

#111
post #75

Earlier quoted context omitted.

>just put up some initial capital in exchange for even more money back Isn't that how index funds work?

People believe in index funds because of multi-decades of globalization and (in general) cheaper money, which has been less and less true since 10 years ago. Even if you bought some during the 90s, you still need a tremendous belief in yourself and the market to hold them for 30 years. It's not that easy. I know many people put the fund into a retirement fund, but 1) is every body consistently doing that for 30 years…

> People believe in index funds because of multi-decades of globalization

At some point we're going to reach the heat-death of the economy and we'll be "completely globalized", I guess?

Re: Buy payphones and retire

#112
post #67
post #53

Earlier quoted context omitted.

Buffett lies. He had much better investments. I likes to tell us all stories. The big-finance reality is much more inside-tradingish than he wants us all to believe.

What investments do you think were better? He's had far more income from other investments. But he turned $25 into $2000 in 3 years. That's around 331% profit per year, compounding annually. Given that he likes to invest in relatively mature companies, I can easily believe that no other investment ever showed a greater annualized return. (Of course this calculation discounts his personal investment of time to run the…

I assume he has to invest in established companies just as a practical matter. If you have $50k, you can put it anywhere from the local donut shop to Apple. If you want to invest $50 billion, your options are significantly more limited on what you can do without outright owning the target company.

Re: Buy payphones and retire

#113

When I was a kid, we stole a payphone. Those bastards are tough . We whacked on it for an hour, with a 15-lb sledgehammer. When it finally broke open, it yielded about $1.50.

Back during college, we found an abandoned one in a massive pile of junk in the basement of one of the research buildings. It was already opened up, but out of curiosity we poked around how it worked, and ended up fabricating a key to open the change drawer - it was just a cross shape, nothing special that even looked key-like.

Nowadays you can just buy them on Amazon.

Re: Buy payphones and retire

#114
post #54
post #18

Earlier quoted context omitted.

It's easier to launder money with services than goods anyway because you don't need to dispose of excess merchandise to make the books balance. Like if you want to claim to have sold 10000 cans of soda despite only selling 1000, you need to buy 10000 cans of soda or even the most superficial review of your accounts will reveal the scheme. The ideal laundering mechanism is a service with a high ratio of price to varia…

Depends on what you want to launder. Drugs are paid for in cash, so you need to launder cash - and the best way to do that is to have a business that does some amount of cash legally. I can imagine vending machines being useful here. You are right about needing to buy cans that you can then pretend to have sold. Unless of course you order from a supplier who is willing to write an invoice for a higher number of cans…

You sell a can of soda for $50 and include a gram of cocaine. I don't know what cocaine sells for but that is how you make it work.

more often this is done not in soda which has a street price that you can't get absurb values on. Better to sell a custom leather purse which can sell for a lot but you can make a junk one for almost nothing.

Re: Buy payphones and retire

#115

The concept of "passive income" is almost a scissor concept. Or maybe only if you couple it with the categorical imperitive. On the one hand, it's so obviously true that it would be great to have passive income. Draw the salary you're drawing now, with some growth, and not have to work. On the other hand, if everyone had access to this capability then society and civilization would grind to a halt. People make things…

> is almost a scissor concept

I was curious but can't seem to find much on that phrase except as a player-movement tactic in US Football.

Perhaps autocorrect-gone-wrong from something else?

Re: Buy payphones and retire

#116

Earlier quoted context omitted.

"passive income", in it's original iteration, wasn't the idea that you could make money by doing nothing. The idea was that you made something or did something that you were uniquely able to make or do, and then the result of your labour would make money for you while you put in minimal continued effort. the version of passive income where you don't do anything productive at all, ever, and just put up some initial ca…

>just put up some initial capital in exchange for even more money back, is always a scam. some people might come out ahead sometimes, but more people will lose than win. How so? My all-world index funds are doing pretty well. For more risk averse, almost every buyer of USA governmental bonds gets "even more money back" in exchange for the initial capital. I don't think that's a scam either.

Every time you pay a profit margin, or pay taxes that cover bond interest, or pay inflated asset prices (real estate), you put money into the system. Every time your stocks, bonds, and real estate holdings go up, you receive money from the system. How good of a deal this is depends on how rich you are and how good you are at picking assets. And your luck at timing, of course.

The Fundamental Theorem of Capitalism -- on expectation, rich people get paid for being rich in proportion to how rich they are and how good they are at capital allocation -- is both great and terrible.

It's great in that it gets you skin-in-the-game capital allocation decisions. Everyone gains 50 IQ points when they have skin in the game and capitalism is how you leverage that to run a society. It's terrible in that it does tend to establish, reinforce, and perpetuate a class hierarchy where the people on the bottom must constantly pay to exist while the people on top constantly get paid to exist. It's great in that it maximizes the money available to accountably chase exciting new prospects. It's terrible in that it creates extraordinary incentives to enshrine old prospects whose time should have passed long ago. It's great in that it can democratize wealth and power away from a King or Party, but it's terrible in that it tends to concentrate wealth and power around the Wealthy. It's great in that damage of capital misallocation can generally be contained to the balance sheets of those most capable of bearing it, but it's terrible in that the wealthy and powerful have the means, motive, and opportunity to bend the entire system towards bailouts, monopolies, and asset-pumping.

It sucks, except for everything else we have tried. Shrug.

Re: Buy payphones and retire

#117
post #106
post #74

Earlier quoted context omitted.

>If the goal is to have a system where everyone can have passive income, then achieving that goal is the end of the world. If AI and robotics continue to be developed, then eventually most human labor becomes uneconomical by comparison. At that point, the system provides passive income on a mass scale (UBI) to prevent its own violent destruction. At least, that's the good ending.

To me, a major obstacle on the path to UBI is that it seems to conflict with the interests of those who benefit from the current status quo. If everyone receives a sufficient basic income, who will fix their toilets or clean their yachts? If the answer is ’no one’, then I’m afraid we’ll need significant advances in automation and robotics—or pitchforks—before we see UBI implemented. But my point of view may be simpli…

Technology is quickly helping to eliminate the "pitchfork" option. By the time we are in a world where human labor is unnecessary or worth nearly nothing, the elite will have all the automated surveillance and robo-policing technology they need to prevent rioting and pitchforks, and more secure ways to remain safely isolated from the rabble. When it comes to "what Sci-Fi future we're headed towards" I would bet on something like Elysium.

Re: Buy payphones and retire

#118

The concept of "passive income" is almost a scissor concept. Or maybe only if you couple it with the categorical imperitive. On the one hand, it's so obviously true that it would be great to have passive income. Draw the salary you're drawing now, with some growth, and not have to work. On the other hand, if everyone had access to this capability then society and civilization would grind to a halt. People make things…

I don't think passive income requires the abolishment of non-passive reward structures.

You'll never hit a point where people will starve before working even if they're pulling in some amount of presumably useless currency. It's hard for me to imagine a scenario you're talking about.

Re: Buy payphones and retire

#119

The concept of "passive income" is almost a scissor concept. Or maybe only if you couple it with the categorical imperitive. On the one hand, it's so obviously true that it would be great to have passive income. Draw the salary you're drawing now, with some growth, and not have to work. On the other hand, if everyone had access to this capability then society and civilization would grind to a halt. People make things…

there are two broad categories of "passive income" that people often talk about, with differing effects on society.

1. You have a product that takes little effort for you to maintain, but people find it valuable and pay for its use. In HN terms, this might be a small software project that can be maintained with just a couple hours each month. This is not bad for society- you are offering something that people find valuable, and you get lucky because it's easy for you! A key point is that you are not exploiting people to make this income. We all have varying skills and we make gains from trade. If you are good at programming and I am not, I can pay you to do something that is easy for you but would have been hard for me. This is how we increase our productivity as a society- let each person focus on the things they are good at and avoid the things that are hard. So this type of passive income is okay. We'll probably never see a society where every need is met through people's low effort projects (nobody has a side project that builds major roads or infrastructure), but you aren't harming society by doing it.

2. You have a product that you charge for and you add no value, but for some reason people have to buy from you. In economic terms, we are talking about rent-seeking. Imagine if, right before a hurricane came through, you bought every single 2x4 from all the Home Depots and Lowes' stores in the local area, and sold them to people at twice the original price trying to repair their houses after the hurricane. You did not improve the value of the 2x4s and if not for you, people could have bought them for less money. You exploited the limited local supply of 2x4s and added nothing, but extracted money from people who had no other choice. This is bad for society.

https://en.wikipedia.org/wiki/Rent-seeking

Re: Buy payphones and retire

#120

The concept of "passive income" is almost a scissor concept. Or maybe only if you couple it with the categorical imperitive. On the one hand, it's so obviously true that it would be great to have passive income. Draw the salary you're drawing now, with some growth, and not have to work. On the other hand, if everyone had access to this capability then society and civilization would grind to a halt. People make things…

It's funny how often you hear "put your money to work". Money doesn't work, people do! If you receive a monthly income by doing nothing, you're taking from someone else's work.
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