Time Value of Money

[Imran Siddiqui]

We're talking about political idea

Is someone paying for someone else's political ideas? Or are you talking in some indirect fashion? What are you getting at?

Selling assets doesn't increase value either

If the asset is sold at a great price than bought (taking inflation in account) then you can definetly say the value of the good as increased. The economic benefit is that the seller gets more money (which stands for value as no one disputes) than he paid in.

Selling, by itself, doesn't increase value, but usually people won't sell the asset until the value has increased to a level to make a profitable.

Though buying and selling does have an indirect effect on the value of the good because in some small way you affect supply and demand.

[Imran Siddiqui]

Oh please stop making obvious, irrelevent statements.

For you the obvious is required. As for the irrelevent... that describes your entire debate technique, doesn't it?

[Kidlicious]

Originally posted by Imran Siddiqui
Is someone paying for someone else's political ideas? Or are you talking in some indirect fashion? What are you getting at?

TVM is a political idea, not an idea for a new product or technology. No one wants to buy it. Well you know what I mean, I hope.

If the asset is sold at a great price than bought (taking inflation in account) then you can definetly say the value of the good as increased. The economic benefit is that the seller gets more money (which stands for value as no one disputes) than he paid in.

There is no overall benefit. The cost equals the benefit. The amount that the buyer pays equals the amount that the seller recieves.

[Imran Siddiqui]

There is no overall benefit. The cost equals the benefit. The amount that the buyer pays equals the amount that the seller recieves.

The benefit is the seller makes more money that he paid for the good. However, that does not mean the buyer is paying more for the good than he would have. Because the seller makes money doesn't mean the buyer is losing.

[Drachasor]

Originally posted by Kidicious


Oh please stop making obvious, irrelevent statements.

Does this help:

Start with this. What is this increase in value that you speak of? Nevermind that the owner recieves rent, and therefor becomes richer. I already know this of course, and it's completely irrelevent. Of course, the person who rents the widget is poorer, and that's why. There is no increase in value there, only a transer in wealth.

The person renter the wigdet gets the value of using it for the rental period.

It's like ice cream; you use up your value and then you are out the money, but you still have whatever value you accumlated while you used it.

The person who has the widget during the rental period gets the benefit. It is like ice cream or some good you use up because of this. That has a value of its own.

In a fair economic exchange both people benefit.

If you refering to why the temporary owner doesn't buy the widget, that could well be because he wants most of his money elsewhere, and doesn't want to spend all that money on outright owning the widget. He might need the widget for a period of time, but beyond that he makes more money investing the difference between the buy price and the rent price in the market.

-Drachasor

[Kidlicious]

Originally posted by Imran Siddiqui


The benefit is the seller makes more money that he paid for the good. However, that does not mean the buyer is paying more for the good than he would have. Because the seller makes money doesn't mean the buyer is losing.

There is no winner or loser. Only a transfer.

[Imran Siddiqui]

There is no winner or loser. Only a transfer.

Yeah... and that transfer can be a benefit to the seller, if he bought the good at a lower level at an earlier time. He had counted on the value of the good increasing and it did.

[Kidlicious]

Originally posted by Drachasor
The person renter the wigdet gets the value of using it for the rental period.

It's like ice cream; you use up your value and then you are out the money, but you still have whatever value you accumlated while you used it.

The person who has the widget during the rental period gets the benefit. It is like ice cream or some good you use up because of this. That has a value of its own.

In a fair economic exchange both people benefit.

If you refering to why the temporary owner doesn't buy the widget, that could well be because he wants most of his money elsewhere, and doesn't want to spend all that money on outright owning the widget. He might need the widget for a period of time, but beyond that he makes more money investing the difference between the buy price and the rent price in the market.

-Drachasor

Do a cost/benefit analysis? Let's take a look at it.

[Kidlicious]

Originally posted by Imran Siddiqui
Yeah... and that transfer can be a benefit to the seller, if he bought the good at a lower level at an earlier time. He had counted on the value of the good increasing and it did.

Leave the other transaction out of it. It's only going to complicate matters. We're going no where with this anyway. You aren't showing me how this is suppose to result in more goods and services being produced.

[Imran Siddiqui]

You aren't showing me how this is suppose to result in more goods and services being produced.

Was that what I was supposed to show you?

You said value, not how is this supposed to increase goods and services produced. Though it may indirectly, because more oppertunities for rent, will increase that market in an area. For example, more renting of houses in an area will usually lead to developments being constructed at a rapid pace.

[Kidlicious]

Originally posted by Imran Siddiqui

You aren't showing me how this is suppose to result in more goods and services being produced.

Was that what I was supposed to show you?

You said value, not how is this supposed to increase goods and services produced. Though it may indirectly, because more oppertunities for rent, will increase that market in an area. For example, more renting of houses in an area will usually lead to developments being constructed at a rapid pace.

It would provide an incentive at best. However, the rent paid on the previous property would not create that value anymore than it creates the value of the property that the rent is collected for, only the labor used to build improvements on that property would create the value for that property.

Consider the case where there is no more zoned land for improvements. How is higher rent suppose to create value in this situation? No value is created until work is actually on done property.

[Imran Siddiqui]

only the labor used to build improvements on that property would create the value for that property.

Bull****. What about the capital, such as the land itself and the big dirt moving machines, etc, etc? They definetly create value for that property. Labor can't do it alone and neither can capital. They need each other.

How is higher rent suppose to create value in this situation?

Higher price can be asked for the house itself.

Or do you mean how is that supposed to create more goods and services? In your case, the government has prevented rent from indirectly creating more goods and services. That doesn't mean it wouldn't increase the value of the properties already being rented, however.

[Flip McWho]

AAARRRRGHHHHH!!!!!!

Anyone getting that feeling?

[Imran Siddiqui]

Well of course... but it is nice to totally destroy Kid's arguments. He'll never change, but as long as you know it, it makes it not that bad.

[Japher]

yeAH... Price = Value until you add the unfair tax on to it