Here's a depressing thought. Everything we buy is overpriced or even worse worthless.
Don't believe me? Try it for yourself. Buy something, even if you consider it a bargain and then try to sell it immediately. Chances are you won't get what you paid for it.
A classic example is a new car, once driven out of the showroom drops in value. Amazing isn't it?
Of course there are exceptions to this rule. Real estate has always been a good purchase especially if you paid cash. Even that has recently become a very shaky proposition with the current economic crisis. I won't even consider the lifetime mortgage and the real cost of a home even if you do sell at a significant capital gain.
Also there are the collectibles which usually increase in value for reasons of rarity or desirability but how often do we factor that in to our daily purchases?
Maybe we can construct a new golden rule that goes something like this...
The price of everything is always at least twice it's real value.
Consider that next time you go shopping.
13 comments:
I buy everything at closeout. The only time I go car shopping is the last week in December when they are trying to unload as many cars as possible to avoid the inventory tax.
The only thing I buy new are durable goods then I try to haggle the price down on a display item that has been discontinued.
I'm a cheap bastard for all the reasons you mentioned.
Land is a screw deal unless you have a ton of it. The capital gains tax on property that is not used a residence is utterly ridiculous.
Part of that lost value is simply because people won't pay for "used" goods - even if they haven't been used. There are always people who want to pay full retail prices - my mother is one. They don't believe they can possibly be getting the best, newest, full quality item if they don't pay the full asking price. We got a deal on a flight to my brother's - beautiful wide leather seats and everything - but our flight - last on a bad weather day -was delayed and my mother said she would never fly on a cheap flight again. I couldn't convince her that other people on that flight had paid full price.
Stocks are pretty much what you pay for and usually you can sell them back right away minus commissions.
Xenophon, "Oeconomicus"
Crit. Precisely; if he has things that injure him, I should regard these rather as a loss than as wealth.
Soc. It follows apparently that if a man purchases a horse and does not know how to handle him, but each time he mounts he is thrown and sustains injuries, the horse is not part of his wealth?
Crit. Not, if wealth implies weal, certainly.
Soc. And by the same token land itself is no wealth to a man who so works it that his tillage only brings him loss?
Crit. True; mother earth herself is not a source of wealth to us if, instead of helping us to live, she helps us to starve.
Soc. And by a parity of reasoning, sheep and cattle may fail of being wealth if, through want of knowledge how to treat them, their owner loses by them; to him at any rate the sheep and the cattle are not wealth?
Crit. That is the conclusion I draw.
Soc. It appears, you hold to the position that wealth consists of things which benefit, while things which injure are not wealth?
Crit. Just so.
Soc. The same things, in fact, are wealth or not wealth, according as a man knows or does not know the use to make of them? To take an instance, a flute may be wealth to him who is sufficiently skilled to play upon it, but the same instrument is no better than the stones we tread under our feet to him who is not so skilled . . . unless indeed he chose to sell it?
Crit. That is precisely the conclusion we should come to.8 To persons ignorant of their use9 flutes are wealth as saleable, but as possessions not for sale they are no wealth at all; and see, Socrates, how smoothly and consistently the argument proceeds,10 since it is admitted that things which benefit are wealth. The flutes in question unsold are not wealth, being good for nothing: to become wealth they must be sold.
Yes! (rejoined Socrates), presuming the owner knows how to sell them; since, supposing again he were to sell them for something which he does not know how to use,11 the mere selling will not transform them into wealth, according to your argument.
Crit. You seem to say, Socrates, that money itself in the pockets of a man who does not know how to use it is not wealth?
Soc. And I understand you to concur in the truth of our proposition so far: wealth is that, and that only, whereby a man may be benefited. Obviously, if a man used his money to buy himself a mistress, to the grave detriment of his body and soul and whole estate, how is that particular money going to benefit him now? What good will he extract from it?
Crit. None whatever, unless we are prepared to admit that hyoscyamus,12 as they call it, is wealth, a poison the property of which is to drive those who take it mad.
And we could say much about those of us who know the price of everything and the value of nothing.
...we're just a wee bit cynical?
Is there such a thing as degrees of cynical?
Diogenes of Sinope used to masturbate nude in the Agora, and when confronted exclaimed that he only wished he could rub his belly and make his hunger go away.
FJ, you've unmasked the blogger in me as the modern day Diogenes.
Alexander the Great once met Diogenes sunning his nude self in the cistern in which he lived. He asked the cynic if there was anything he could do for him. Diogenes asked him to step to one side, as he was blocking his sun. Alexander later commented that were he not the most powerful Macedonian king ever known, he'd want to be Diogenes.
Lex, have you ever heard George Carlin's bit on how women save money by shopping? Hilarious. (I hate department stores.)
Nearly every piece of clothing I own is from a thrift store. I'm not sure what that says about me. Oh, and I won't buy a new car.
Thanks Pinky, no I haven't. I'll have to find it on Youtube.
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