Strong Towns Podcast
Episode 212

Loose Ends

Charles Marohn published on

Chuck does a solo podcast this week in an attempt to tie together a bunch of loose ends.

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  • Eli Damon

    Regarding your thought experiment about the generational infrastructure fee: I think you have a good point in there, but the math doesn't make sense.

    1. It doesn't make sense to talk about the house you live in as an investment. It's a product that you consume (although you could regard the property as an investment). You can't sell it and continue to consume it. It has a finite lifetime. It's real value will diminish over time, although that time should be many generations. It also costs money to maintain it, just as it costs money to maintain the infrastructure that serves it.

    2. When you talk in terms $/generation, you make the same error that you accused ASCE of. The fee is paid every generation. The house will last many generations (assuming it's a decent house). Property taxes (how infrastructure is normally paid for) is paid annually, and most money calculations are annual.. People are going to react different to a bigger number than to a smaller number even they represent the same thing.

    Regarding the need for civil discourse between people who disagree with each other, I totally agree, and thank you being the voice of reason. I am often frustrated, not only by people who won't listen to me because they like what I'm saying, but also by people I agree with because the conversation can be so shallow, even if it is more agreeable.

  • Charles Marohn

    Eli, my friend....your points (1) a house is not an investment and (2) a house lasts many generations just can't be reconciled for me. Those seem incompatible assertions.

  • Eli Damon

    I guess you can take "investment" in a number of different senses. I took it in the sense of buying with the intent to sell at a profit, and I think that treating your home this is a recipe for disaster.

    But maybe you meant it in the more general sense of putting in effort now with the expectation of that it will lead to greater benefit later. If that's the case, then I agree with you.

  • Charles Marohn

    I'm really talking about it in the sense that it makes sense to own it at a certain price. If I buy a $200,000 home instead of renting, I'm deciding that it is an investment worth owning. I may not expect it to appreciate and maybe I even think it would depreciate, but I must believe that I would have more for my money in the end than in paying someone else who owns it rent for the same property.

    In the sense that is a investment, people who own homes are not aware of the massive liability they have assumed -- or are dependent on others meeting -- in order for that calculation to work out. If they were aware of that, many homes would be worthless (because they are).

  • Jennifer Arnold

    This is excellent -- when people transfer their sense of personal self with ownership of delineations and objects , we get really confused about what is capital. The reason why you buy a house , is because , it is the equivalent of a gold bar at Fort Knox , it is then, a commitment, which can be borrowed off of . The home ownership, actually means , I am a sitting duck , and this is my nest , and that makes you a target , for increase home equity loans, taxes, and your children are scooped by the "education" system for indoctrination into the system . Smart people, can do just what the governments have done , use the equity , to stay afloat, run on that , until its run out , and then bail -- in the meantime having had a nice life experience and given your kids bedrooms to themselves and a nice yard to play in . Until we understand that capital, is the head of each man , woman and child, and what goes on inside that head , we are going to be really confused -- I like how the man says -- its all about getting the conversation into reality , and out of cyber space . Because that is where you learn how to wipe a table, or plant a tree . Well done thoughts -- Jennifer Arnold