Wednesday assorted links

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4. Relying on rising asset prices, especially housing prices, for prosperity has motivated owners of assets to do what they can to protect those rising asset prices. Duh. At least we know that owners of houses are rational, something we cannot say about the policy makers who have put us in this fix; and it is a "fix", for it requires ever increasing prices to work its magic just like it requires an ever increasing amount of opioid to work its magic.

By all means get rid of the mortgage interest tax deduction, but don't for a second think that it will have more than a marginal impact on average home prices. In 2015, only about 21% of tax returns made use of mortgage interest deduction, and for returns with income of more than $250,000, the average deduction was about $15k (https://www.fool.com/retirement/2017/03/12/the-average-americans-tax-deductions-by-income.aspx). It definitely affects the price of really expensive homes bought by people with a high income. But most people wouldn't even notice. That being said, it would make San Francisco a lot cheaper to live in.

How would eliminating the Federal tax preferences increase that tax revenues in California to pay to build transportation, water and sewer, and school infrastructure to greatly increase the supply of housing within 30 minutes travel of work locations in San Francisco?

It's not like there is no land that can be built on, it's just you can't get there from the jobs, and the communities with the farms do not want higher taxes to build schools, etc, given they voted in the 70s to deny raising tax revenues to build schools for working class family kids.

Brown fought to get the gas tax hiked to finally pay workers to fix roads and bridges and other transportation needs, but the conservatives are spending millions in a campaign to kill all those working class jobs for people without college degrees.

Doubling the price of a single family home does not double the value: it still only houses a single family, providing the isolation and recreation space that makes a single family home more desirable than multifamily housing.

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How does inflated prices on assets that have not increased in value promoted prosperity?

The value of a single family home with yards for isolation and recreation, like gardening, is it houses a single family with yards for isolation and recreation.

Increasing the price of a single family home from $200,000 to $1,000,000 does not provide single family housing for five families.

And given you can't sell it and buy another $200,000 single family home in the same area convenient to work, etc, you have no way to spend the inflated price. Except by gambling that nothing will destroy the demand that inflates the price, and borrowing money you can't repay, and spending it.

Many Midwest cities had housing stock of great value priced a replacement cost that today are priced so far below replacement costs due to complete lack of demand, they are being torn down to cut the tax bills levied on the value which is often higher than the price, if they are habitable.

Who imagined that housing in Detroit which was mostly single family, quality construction, with great services, would within a decade or two be priced at less than 50% of the price close to replacement costs?

The number one reason development is opposed is to prevent tax hikes.

Tax hikes to build roads, water, sewer, etc. Tax hikes to build schools for lots of new kids, kids that will likely be poorer than the older kids of established homeowners.

In California, the assessed price of real estate is not allowed to increase no matter how many decades since last sale, plus tax rates are not allowed to be increased. Thus, the funding for new roads, water, sewer, and new schools is sharply curtailed, and new development can be done in the traditional manner only by cutting public services to existing residents, making the schools worse for the kids of people who bought to gain access to the good schools, making the roads more congested and more poorly maintained, making the streets open up car swallowing sinkholes from water main breaks.

Stopping development is very conservative, very much consistent with the GOP anti-tax policies.

The ever rising prices are just as useful as the rising price of Amazon shares. What good is it the Bezos is worth more than $100 billion based on the price of his Amazon shares that he can never sell, lest Amazon, the greatest retailer becomes the next Sears, the 1970s Createst Retailer, both starting from mail order sales of a single product, watches, and books.

Sears sold houses in kit form, 25 tons of materials that used the "modern" house construction methods that still dominates today's home construction. Just to bring it back to housing.

Stopping development is very conservative, very much consistent with the GOP anti-tax policies.

I accidentally read part of a Mulp post, and this was it.

It hasn't gotten any closer to sentience

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In California, the assessed price of real estate is not allowed to increase no matter how many decades since last sale.

Not true, taxes go up 2% a year and any new bonded indebtedness is added to the property tax bill.

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Depending on how important you think 4) is, it's a pretty strong argument in favor of (or mitigating factor assuaging disappointment in) the recent tax law. The combination of lowering the mortgage limit, the SALT cap, and the much higher standard deduction (by moving exemptions to credits and the higher standard deduction) hugely decrease the value of the MID. We shall see to the extent the next Democratic Congress tries to reverse that.

Ultimately the long term goal of tax reform will depend on shrinking the pool of voters interested in itemizing their deductions.

By the mid 2000s, the share of itemizers had risen to 36% (and given the income skew of voting patterns in the US, that 36% of households probably represented a majority of voters). https://www.taxpolicycenter.org/taxvox/rise-and-fall-itemized-deductions

According to some research that I've seen, the new tax law could shrink the itemizer share of tax returns to barely 1 in 10.

Granted, those 1 in 10 represent households which account for the vast majority of political donations but we're getting closer to the point where a populist politician might actually be able to abolish those "tax breaks for the rich" and kill itemization entirely.

But it wont turn a single family home into two or five single family homes.

Only tax hikes to fund infrastructure will the supply of housing increase, and even in densely populated areas, single family housing with yards, etc, represent at least 50% of the housing units.

While various methods force the cost of transportation on housing developments, there is no way to force the costs of schooling the kids on housing developers.

Telling young working class families you can buy a new house, but you must pay for private schools for your child, just doesn't fly. If nothing else, they will sue using the 14th Amendment for the same public schools as the rest of the families in the area.

"But it wont turn a single family home into two or five single family homes."

Over time, sure it will. With the MID and SALT limits, wealthy people will be less willing, on the margin, to spend lavishly on homes now that Feds have reduced tax breaks for property taxes and mortgage interest. So a development that, pre-tax law, would have made most sense as a small number of high-end homes for the wealthy will make more sense as a greater number of less costly homes. And some large, expensive houses on double lots will get knocked down and replaced by multiple smaller houses.

It may also reduce the political incentive to drive up housing prices by restricting land development. There's always these secondary effects to consider. Local governments want to maximize the tax revenue they get from housing, so if the market value of one large house declines, they will make regulatory changes to allow those multiple smaller houses to get built - if it increases tax revenue.

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There's a natural rate of decay for houses over time. Large SFHs get converted into multi family units. Old SFHs get torn down and replaced with multifamily family units.

In-fill development is a real thing.

slums are a real thing.

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Why do you think you need tax hikes to build infrastructure? Low-tax Texas has the best infrastructure in the country. All California has to do is stop pissing its money away on idiocy, and it'll have plenty of money for top-notch infrastructure.

And that's easy enough to do; just vote the idiots who piss the money away out of office, so they can't anymore. They're already conveniently marked with a D (for "dumbass", which is their party's animal mascot), so it's not particularly hard to know who to get rid of.

This is true. Unfortunately, the Democrats are of the opinion that any money spent by the government is a stimulus with a multiplier effect so it literally doesn't matter what it gets spent on. Which is convenient because then you can spend it on giving money to people who vote for (and fund) Democrats.

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Seems to me Texas is compact and FLAT. I love living in the mountains of California.

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1. So two ways of expressing something are different in different languages, and those differences reflect why different languages are different?

It isn't really that translation is hard - it is pretty much impossible when going beyond the mundane (and even then can be tricky - if you can park your car on the pavement just might depend on which English speaking country you find yourself in), trying to reconcile that which cannot be reconciled. Or to use a putatively Italian expression translated into English concerning translation - 'Translation is like a wife - a beautiful one is unfaithful, and a faithful one is ugly.'

Or Russian, upon searching - 'Translation is like a woman. If it is beautiful, it is not faithful. If it is faithful, it is most certainly not beautiful.' Yevgeny Yevtushenko https://www.brainyquote.com/authors/yevgeny_yevtushenko Somehow, I doubt he said that in English - maybe a Russian speaker can add some insight whether his actual quip contains elements that were not translated into English.

I think the point is that translation - especially considered broadly to include editing, redaction, and lots of other activities that moderns don't typically consider when they think of "authorship" - is severely underrated.

Perhaps it was in the New Yorker--decades ago, when the quality of its prose was astounding (I can sill recall the ambivalence of feeling snookered getting entranced by a wonderful piece about . . . the pleasures of shopping in thrift stores in Canada*)--extoling Constance Garnett. I don't read Russian and the piece convinced me I knew nothing of Dostoyevsky or Tolstoy, but I only knew her. And I believed and dd not mind.

* Guy's Frenchies. . . the shit doesn't even make sense to me now.

decades ago, when the quality of its prose was astounding

I still subscribe to the New Yorker out of habit (40 years or so), and by coincidence, just finished skimming the most recent issue. It reads like it was hijacked by a cult.

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It also seems like an odd comment to make it into English, given that there are plenty of beautiful and faithful people to be found, if you're willing to take the time to look and be beautiful and faithful yourself.

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I recently heard from a friend who works for one of our finer financial institutions that a new Japanese>English neural network translation system is around 90% accurate with business articles, whereas he guesses the current system that was bought several years ago is 40% accurate.

There is no Great Stagnation in machine translation.

But maybe no great leap forward either: https://www.bbc.com/news/technology-45112232

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From people who know ballistics better than me, why is 2 hours from Beijing to New York via supersonic aircraft an unstoppable game changer when they have 30 minutes from Beijing to New York via ICBM?

ICBMs can't dodge. these can.

Is there any serious evidence that ICBMs need to dodge?

THe US aegis system seems to have a pretty solid record in tests against ballistic missiles so i would say yes.

Oh, yeah, it worked a treat against Iran Air 655
http://www.slate.com/articles/news_and_politics/war_stories/2014/07/the_vincennes_downing_of_iran_air_flight_655_the_united_states_tried_to.html

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Well the first one doesn't start WW3, so it's got that going for it.

But more seriously, the economics of this are going to be paramount. If the cost is 10x a normal flight, then it's not going to have any gross effects. After all it's competing with both normal well established flights and the internet. And it's going to be more expensive than a normal flight and slower than an internet connection.

Oops, my bad, I mixed this story up with a story about a supersonic passenger aircraft.

So, no this doesn't have any advantage over a normal ICBM.

Don't feel sorry. Hillary lovers like you tend to mix things up from time to time.

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Accuracy in conventional warhead delivery. ICBMs typically miss by 100 - 200 m, which means they are ineffective when armed with conventional warheads unless the intention is to simply terrorize a population in a city.

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Eliminating the mortgage interest tax deduction would throttle back housing prices but it would also be wildly opposed by housing contractors, building supply companies, furniture and appliance retailers, realtors and title insurance companies, permitting agencies, architects, mortgage companies and banks. Ain't gonna happen.

In addition to your list are two massively important entities. One, FNMA/FHLMC (huge-money lobbying organs both before and since the housing bubble/burst) and the 63% (it was 69% in 2006/7) of the American people that own their homes.

For you leftists/totalitarians, 63% is a majority, used to rule when America was a free country.

Formerly, people's rights to advance their personal interests were deemed good. Now, not good for self-interested elitists/totalitarians that think they should be running the World.

Lots of Americans own cars and need cars in order to get around. Should we create a Car Loan Interest Deduction?

Just because you benefit from something doesn't mean the government should subsidize it through the tax code.

Just refinance your house and take cash out to buy your car and voila! Car loan interest deduction.

I suggest you review the new rules on "home equity loans". Interest paid on a new loan used to finance a car is no longer deductible even if that loan is secured by a home mortgage.

https://www.irs.gov/newsroom/interest-on-home-equity-loans-often-still-deductible-under-new-law

Voila!

Ball sacks... there goes the new minivan.

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Until Reagan's 1986 tax reform, all personal loan interest was deductible, plus all medical expenses.

That car deal was true (limited to debt of $100,000, or . . . ) until President Trump's tax reform effective for tax year 2018.

Apparently, a lesson not learned after 2008: using your home as an ATM can be very bad. Ergo I paid-off my HEL.

I keep forgetting that I need to be yugely more grateful that the government lets me keep so much of the money I earn.

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We are allowed to vote for our benefits.

I'm of the opinion that "subsidize" does not mean what you think.

Stealing my tax dollars to pay for your entitlements sounds like socialism. Are you friends with Ocasio by any chance?

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Vote for our benefits?

You mean, voting away other peoples' money and putting it in your own pocket?

Sure, technically you can do that but it doesn't mean I'm going to support your right to steal from your neighbor.

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You might as well change your name to Dick the Thief because that is what you are when welfare queens like you use the government to steal from my hard work to fund your ridiculous lifestyle.

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"Ain't gonna happen."

To a significant extent, It already *did* happen with the tax reform law. Combine the $750K mortgage limit with the $10K SALT limit and the increase in standard deduction, and relatively few homeowners are going to be itemizing, and those who do itemize are going to realize much lower benefits from deducting property taxes and mortgage interest than before (e.g. because the difference between the itemized deductions and standard deduction will be much smaller than before).

Somehow, the real-estate lobby didn't manage to stop the tax reform bill from happening.

I guess this just isn’t an area of expertise for me.

What’s to stop my wife and I from starting a LLC and buying property. Dollar for dollar deducting from our income taxes: mortgage, property tax, upkeep, depreciation....

How is this not a giant loophole. I mean maybe you cannot rent to yourself?

But this would still allow me to deduct as much as I want from taxes while building equity in a stupid investment that only makes sense due to tax law.

Your corporation won't get a fixed rate, 30 year mortgage with 3.5% down from the FHA. It's not going to get a 30 year mortgage at all.

You are going to pay a much higher rate for your corporate mortgage than a personal mortgage. The banks will treat your workaround scheme like a rental property and will charge you higher interest rates with worse terms in response.

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Passive activity loss limitations. The costs are deductible only to the extent they offset the LLC's income. But the LLC doesn't have any income that's not coming from you.

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It's really, really simple why it isn't a "giant loophole" -- because the IRS isn't run by idiots and the tax courts are not in the habit of allowing stupidly easy tax dodges.

That answer applies, incidentally, to any other "giant loophole" you think of, from now until the end of time*.

*Provided you don't become a genuine tax law expert who has spent more than a hundred hours pouring through precedents and statutory text and IRS regulations to correctly shape and narrow your loophole to avoid immediate voiding.

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#1. Big difference between fiction and non-fiction, I suppose. Or maybe the big difference is between the presentation of facts and the narration of a story. I can convey facts, but communicating meaning is much harder. It requires a congruence between the writer's and the reader's minds. This isn't exactly news to any thinking individual, I hope. OTOH, she writes about alliteration, which means she's going for the evocation of emotion. That is, she's discussing art, not science. Words don't in and of themselves have meaning. Who would have guessed?

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#5 - "The report states that New Zealand is viewed as 'the soft underbelly' of its western big brothers such as the UK and US."

What you mean "we," kimosabe? The US isn't a member of the Commonwealth. Time for these Imperial vestiges to grow up and be real countries and deal with the threat.

If China were out to exact revenge on the British Empire for the Opium Wars, would they behave any differently? Remote, sparsely populated Australia and New Zealand have targets on their backs, no question. Canada will take longer because of its proximity to the US but I think the process is already well underway.

Another fine example that Chinese immigrant communities pose a grave security threat to host countries. Unfortunately, people like Hazel want to donate Western countries to the Chicoms by not putting restrictions on them. Really sickening.

Your fear the Chicoms narrative isn't quite gelling with the outrage over Harvard excluding them from admissions, Anon. Get it straight - either we're supposed to be mad that they aren't getting their deserved 43% of the Harvard freshman class, OR they are subversive aliens who need to be quarantined in internment camps. Pick one.

Is Diversity our Strength yet?

If it isn't you can take the first flight to Somalia. I hear they are 100% Somali out there.

Except they don't identify as Somali but rather as part of family clans that always fight. Which is why the place sucks.

As if given half the chance we wouldn't divide ourselves into Hatfields and McCoys.

Isn't that precisely what worrying about Whites vs. Blacks vs. Asians IS?

I mean, I'm sure the Hatfields would have espoused the opinion that there would be peace and harmony (social trust, ahem) if only they could finally wipe out the McCoys.

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I'm not advocating putting them in camps. Just keep them out of sensitive government and corporate positions. They can go to Harvard...I don't care.

Ahh, they can go to Harvard as long as they aren't allowed to do any networking while they are there.

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Why you think these are the same groups of people is beyond me.

I suppose you lean towards the “don’t tax private universities or their massive endowments because #education, but they’re private so they get to be racist” crowd.

Hope I’m wrong.

Its beyond you because you need to get more life experience and put more effort into applying yourself, son. Being an MR keyboard warrior doesn't make you great, it makes you a cuck.

Hope I'm wrong.

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#1...well done...but sacred texts can only be studied...not translated...any translation is thick with interpretation...

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#1 is well analyzed, but very poorly translated:

Muse, tell me how he wandered and was lost
when he had wrecked the holy town of Troy.

The passive part of the Greek verb means made to wander --not that he was lost? He was diverted, shifted aside. And not only is the meaning wrong, but it is weak. There is no point in taking apart the language of the divine Homer, if the translator does not have the creative chops to cope with him.
Likewise, the second line is timid and perverse and deflates the entire tone of the epic. Odysseus is the sacker of a great city (of the time.) By constrast, someone who wrecks a town sounds like a drunk and unruly college student. A more literal translation would be better, for instance:

Sing, Muse, the man much turned and turning,
Who greatly wandered and was driven
After he sacked Troy's sacred city.

Who cares about a man who wrecked a town and then couldn't read a map and got lost? Phew. The humanities are dead.

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2. Are we really supposed to take the advice of people who can't even figure out how to use Twitter properly?

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