[surveyor]

[quote=pri_dk]
Price/volume relationships have nothing do with taxes. People don’t “buy” more taxes when the price goes down.[/quote]

Hobie’s point is that a business gets more customers when it lowers its prices. Through volume, the business is better able to increase its revenues even though its price is low. There are more people available to purchase at a low price point vs. a high price point.

A similar thing happens when taxes are low. If taxes are low, there is less incentive to avoid paying taxes, thereby opening up more people to be susceptible to taxes.

Case in point: John Kerry preferred to keep his yacht in Rhode Island (low taxes), as opposed to Massachussets (higher taxes). Even though he was rich, he still wanted to avoid paying such an onerous tax.

[surveyor]

[quote=pri_dk]
Price/volume relationships have nothing do with taxes. People don’t “buy” more taxes when the price goes down.[/quote]

Hobie’s point is that a business gets more customers when it lowers its prices. Through volume, the business is better able to increase its revenues even though its price is low. There are more people available to purchase at a low price point vs. a high price point.

A similar thing happens when taxes are low. If taxes are low, there is less incentive to avoid paying taxes, thereby opening up more people to be susceptible to taxes.

Case in point: John Kerry preferred to keep his yacht in Rhode Island (low taxes), as opposed to Massachussets (higher taxes). Even though he was rich, he still wanted to avoid paying such an onerous tax.

[surveyor]

[quote=pri_dk]
Price/volume relationships have nothing do with taxes. People don’t “buy” more taxes when the price goes down.[/quote]

Hobie’s point is that a business gets more customers when it lowers its prices. Through volume, the business is better able to increase its revenues even though its price is low. There are more people available to purchase at a low price point vs. a high price point.

A similar thing happens when taxes are low. If taxes are low, there is less incentive to avoid paying taxes, thereby opening up more people to be susceptible to taxes.

Case in point: John Kerry preferred to keep his yacht in Rhode Island (low taxes), as opposed to Massachussets (higher taxes). Even though he was rich, he still wanted to avoid paying such an onerous tax.

[surveyor]

[quote=pri_dk]
Price/volume relationships have nothing do with taxes. People don’t “buy” more taxes when the price goes down.[/quote]

Hobie’s point is that a business gets more customers when it lowers its prices. Through volume, the business is better able to increase its revenues even though its price is low. There are more people available to purchase at a low price point vs. a high price point.

A similar thing happens when taxes are low. If taxes are low, there is less incentive to avoid paying taxes, thereby opening up more people to be susceptible to taxes.

Case in point: John Kerry preferred to keep his yacht in Rhode Island (low taxes), as opposed to Massachussets (higher taxes). Even though he was rich, he still wanted to avoid paying such an onerous tax.

[surveyor]

[quote=pri_dk]Since you obviously missed it the first time, be sure to pay attention to the parts about debt in Millionaire Next Door. Stanley and Danko recommend paying off the credit card every month. Our government hasn’t been doing that. The tax cuts simply mean the bill will get bigger.[/quote]

Absolutely correct, it is the GOVERNMENT who has not been paying its bills. And so that is why I do not like the GOVERNMENT forcing us to pay more in taxes when it is the government not living within its means.

Anyways, here are some practices of people who become wealthy:

1. Be frugal in spending money (government does not do this).
2. Pay off bad debts and avoid negative interest (government does not do this).
3. Keep “maintenance costs” and other expenses low (government does not do this).
4. Keep “prices” (taxes) low in order to get more people/customers paying.

Maybe from these lessons we can find out why our government is not doing its job very well.

Because of the economy, many real estate investors are having trouble finding and keeping tenants. Basic fact. They have to keep their rents low in order to attract more tenants. Many investors may be in negative cash flow territory (they are in deficit, or in debt).

Now, this is their dilemma: they can either raise their rents, thereby almost guaranteeing that they will not get more tenants, or they will lower their rents and keep them low in order to attract as many tenants as they can. The solution for the smart ones is to keep the rents low or make them a little lower in order to attract as many tenants as possible. Because of this practice, their deficit/debt becomes less than if they raise their rents. Yes, they are still running a deficit and have debt, but it would be less.

So your argument about how tax cuts increase the deficits is flawed.

In any case, the problem with the deficit and the debt is not income (taxes), but spending. Every successful PAW millionaire knows that.

[surveyor]

[quote=pri_dk]Since you obviously missed it the first time, be sure to pay attention to the parts about debt in Millionaire Next Door. Stanley and Danko recommend paying off the credit card every month. Our government hasn’t been doing that. The tax cuts simply mean the bill will get bigger.[/quote]

Absolutely correct, it is the GOVERNMENT who has not been paying its bills. And so that is why I do not like the GOVERNMENT forcing us to pay more in taxes when it is the government not living within its means.

Anyways, here are some practices of people who become wealthy:

1. Be frugal in spending money (government does not do this).
2. Pay off bad debts and avoid negative interest (government does not do this).
3. Keep “maintenance costs” and other expenses low (government does not do this).
4. Keep “prices” (taxes) low in order to get more people/customers paying.

Maybe from these lessons we can find out why our government is not doing its job very well.

Because of the economy, many real estate investors are having trouble finding and keeping tenants. Basic fact. They have to keep their rents low in order to attract more tenants. Many investors may be in negative cash flow territory (they are in deficit, or in debt).

Now, this is their dilemma: they can either raise their rents, thereby almost guaranteeing that they will not get more tenants, or they will lower their rents and keep them low in order to attract as many tenants as they can. The solution for the smart ones is to keep the rents low or make them a little lower in order to attract as many tenants as possible. Because of this practice, their deficit/debt becomes less than if they raise their rents. Yes, they are still running a deficit and have debt, but it would be less.

So your argument about how tax cuts increase the deficits is flawed.

In any case, the problem with the deficit and the debt is not income (taxes), but spending. Every successful PAW millionaire knows that.

[surveyor]

[quote=pri_dk]Since you obviously missed it the first time, be sure to pay attention to the parts about debt in Millionaire Next Door. Stanley and Danko recommend paying off the credit card every month. Our government hasn’t been doing that. The tax cuts simply mean the bill will get bigger.[/quote]

Absolutely correct, it is the GOVERNMENT who has not been paying its bills. And so that is why I do not like the GOVERNMENT forcing us to pay more in taxes when it is the government not living within its means.

Anyways, here are some practices of people who become wealthy:

1. Be frugal in spending money (government does not do this).
2. Pay off bad debts and avoid negative interest (government does not do this).
3. Keep “maintenance costs” and other expenses low (government does not do this).
4. Keep “prices” (taxes) low in order to get more people/customers paying.

Maybe from these lessons we can find out why our government is not doing its job very well.

Because of the economy, many real estate investors are having trouble finding and keeping tenants. Basic fact. They have to keep their rents low in order to attract more tenants. Many investors may be in negative cash flow territory (they are in deficit, or in debt).

Now, this is their dilemma: they can either raise their rents, thereby almost guaranteeing that they will not get more tenants, or they will lower their rents and keep them low in order to attract as many tenants as they can. The solution for the smart ones is to keep the rents low or make them a little lower in order to attract as many tenants as possible. Because of this practice, their deficit/debt becomes less than if they raise their rents. Yes, they are still running a deficit and have debt, but it would be less.

So your argument about how tax cuts increase the deficits is flawed.

In any case, the problem with the deficit and the debt is not income (taxes), but spending. Every successful PAW millionaire knows that.

[surveyor]

[quote=pri_dk]Since you obviously missed it the first time, be sure to pay attention to the parts about debt in Millionaire Next Door. Stanley and Danko recommend paying off the credit card every month. Our government hasn’t been doing that. The tax cuts simply mean the bill will get bigger.[/quote]

Absolutely correct, it is the GOVERNMENT who has not been paying its bills. And so that is why I do not like the GOVERNMENT forcing us to pay more in taxes when it is the government not living within its means.

Anyways, here are some practices of people who become wealthy:

1. Be frugal in spending money (government does not do this).
2. Pay off bad debts and avoid negative interest (government does not do this).
3. Keep “maintenance costs” and other expenses low (government does not do this).
4. Keep “prices” (taxes) low in order to get more people/customers paying.

Maybe from these lessons we can find out why our government is not doing its job very well.

Because of the economy, many real estate investors are having trouble finding and keeping tenants. Basic fact. They have to keep their rents low in order to attract more tenants. Many investors may be in negative cash flow territory (they are in deficit, or in debt).

Now, this is their dilemma: they can either raise their rents, thereby almost guaranteeing that they will not get more tenants, or they will lower their rents and keep them low in order to attract as many tenants as they can. The solution for the smart ones is to keep the rents low or make them a little lower in order to attract as many tenants as possible. Because of this practice, their deficit/debt becomes less than if they raise their rents. Yes, they are still running a deficit and have debt, but it would be less.

So your argument about how tax cuts increase the deficits is flawed.

In any case, the problem with the deficit and the debt is not income (taxes), but spending. Every successful PAW millionaire knows that.

[surveyor]

[quote=pri_dk]Since you obviously missed it the first time, be sure to pay attention to the parts about debt in Millionaire Next Door. Stanley and Danko recommend paying off the credit card every month. Our government hasn’t been doing that. The tax cuts simply mean the bill will get bigger.[/quote]

Absolutely correct, it is the GOVERNMENT who has not been paying its bills. And so that is why I do not like the GOVERNMENT forcing us to pay more in taxes when it is the government not living within its means.

Anyways, here are some practices of people who become wealthy:

1. Be frugal in spending money (government does not do this).
2. Pay off bad debts and avoid negative interest (government does not do this).
3. Keep “maintenance costs” and other expenses low (government does not do this).
4. Keep “prices” (taxes) low in order to get more people/customers paying.

Maybe from these lessons we can find out why our government is not doing its job very well.

Because of the economy, many real estate investors are having trouble finding and keeping tenants. Basic fact. They have to keep their rents low in order to attract more tenants. Many investors may be in negative cash flow territory (they are in deficit, or in debt).

Now, this is their dilemma: they can either raise their rents, thereby almost guaranteeing that they will not get more tenants, or they will lower their rents and keep them low in order to attract as many tenants as they can. The solution for the smart ones is to keep the rents low or make them a little lower in order to attract as many tenants as possible. Because of this practice, their deficit/debt becomes less than if they raise their rents. Yes, they are still running a deficit and have debt, but it would be less.

So your argument about how tax cuts increase the deficits is flawed.

In any case, the problem with the deficit and the debt is not income (taxes), but spending. Every successful PAW millionaire knows that.

[surveyor]

[img_assist|nid=14380|title=Taxes Revenue 1920’s|desc=|link=node|align=left|width=100|height=71]

Andrew Mellon:

“The History of taxation shows that taxes which are inherently excessive are not paid. The high rates inevitably put pressure upon the taxpayer to withdraw his capital from productive business and invest it in tax-exempt securities or to find other lawful methods of avoiding the realization of taxable income. The result is that the sources of taxation are drying up; wealth is failing to carry its share of the tax burden; and capital is being diverted into channels which yield neither revenue to the Government nor profit to the people.”

Now I will concede that a 2% increase is not a “game-changer” that will lay waste to the economy. Still, the last thing I wish to do is to give a drug addict 2% more drugs. Common sense to the type of people who would be posting here, I would think.

(drug addict = congress spending)

Been re-reading the Millionaire Next Door book and it says that one of the aspects of the successful rich is that they are able to be frugal with their money and know how to expose LESS of their income to taxes.

[surveyor]

[img_assist|nid=14380|title=Taxes Revenue 1920’s|desc=|link=node|align=left|width=100|height=71]

Andrew Mellon:

“The History of taxation shows that taxes which are inherently excessive are not paid. The high rates inevitably put pressure upon the taxpayer to withdraw his capital from productive business and invest it in tax-exempt securities or to find other lawful methods of avoiding the realization of taxable income. The result is that the sources of taxation are drying up; wealth is failing to carry its share of the tax burden; and capital is being diverted into channels which yield neither revenue to the Government nor profit to the people.”

Now I will concede that a 2% increase is not a “game-changer” that will lay waste to the economy. Still, the last thing I wish to do is to give a drug addict 2% more drugs. Common sense to the type of people who would be posting here, I would think.

(drug addict = congress spending)

Been re-reading the Millionaire Next Door book and it says that one of the aspects of the successful rich is that they are able to be frugal with their money and know how to expose LESS of their income to taxes.

[surveyor]

[img_assist|nid=14380|title=Taxes Revenue 1920’s|desc=|link=node|align=left|width=100|height=71]

Andrew Mellon:

“The History of taxation shows that taxes which are inherently excessive are not paid. The high rates inevitably put pressure upon the taxpayer to withdraw his capital from productive business and invest it in tax-exempt securities or to find other lawful methods of avoiding the realization of taxable income. The result is that the sources of taxation are drying up; wealth is failing to carry its share of the tax burden; and capital is being diverted into channels which yield neither revenue to the Government nor profit to the people.”

Now I will concede that a 2% increase is not a “game-changer” that will lay waste to the economy. Still, the last thing I wish to do is to give a drug addict 2% more drugs. Common sense to the type of people who would be posting here, I would think.

(drug addict = congress spending)

Been re-reading the Millionaire Next Door book and it says that one of the aspects of the successful rich is that they are able to be frugal with their money and know how to expose LESS of their income to taxes.

[surveyor]

[img_assist|nid=14380|title=Taxes Revenue 1920’s|desc=|link=node|align=left|width=100|height=71]

Andrew Mellon:

“The History of taxation shows that taxes which are inherently excessive are not paid. The high rates inevitably put pressure upon the taxpayer to withdraw his capital from productive business and invest it in tax-exempt securities or to find other lawful methods of avoiding the realization of taxable income. The result is that the sources of taxation are drying up; wealth is failing to carry its share of the tax burden; and capital is being diverted into channels which yield neither revenue to the Government nor profit to the people.”

Now I will concede that a 2% increase is not a “game-changer” that will lay waste to the economy. Still, the last thing I wish to do is to give a drug addict 2% more drugs. Common sense to the type of people who would be posting here, I would think.

(drug addict = congress spending)

Been re-reading the Millionaire Next Door book and it says that one of the aspects of the successful rich is that they are able to be frugal with their money and know how to expose LESS of their income to taxes.

[surveyor]

[img_assist|nid=14380|title=Taxes Revenue 1920’s|desc=|link=node|align=left|width=100|height=71]

Andrew Mellon:

“The History of taxation shows that taxes which are inherently excessive are not paid. The high rates inevitably put pressure upon the taxpayer to withdraw his capital from productive business and invest it in tax-exempt securities or to find other lawful methods of avoiding the realization of taxable income. The result is that the sources of taxation are drying up; wealth is failing to carry its share of the tax burden; and capital is being diverted into channels which yield neither revenue to the Government nor profit to the people.”

Now I will concede that a 2% increase is not a “game-changer” that will lay waste to the economy. Still, the last thing I wish to do is to give a drug addict 2% more drugs. Common sense to the type of people who would be posting here, I would think.

(drug addict = congress spending)

Been re-reading the Millionaire Next Door book and it says that one of the aspects of the successful rich is that they are able to be frugal with their money and know how to expose LESS of their income to taxes.

[surveyor]

[quote=briansd1]Not to say that there wasn’t waste, but at least government spending on salaries and pensions went to millions of ordinary people so their lives could be more enjoyable.

I believe that the misallocation of resources in government is as much in salaries and pensions as in giveaway sweetheart deals to private contractors who pocket the profits.

The bankers’ excesses and bailouts went to a small number of people at the very top.[/quote]

One of the things you’ll learn when you start getting some experience in real estate investing (and when doing any business really) is that maintenance costs do not contribute much to your profit line.

If you have a property and choose to pay more in repair, maintenance, and other costs, it will not increase your profit margin. In fact, it will actually harm your property’s value because many lenders will look at your property and its costs and will conclude that you spend too much money on maintenance and other costs and will deem you a bad credit risk.

However, if you choose to make upgrades in your property (for example, adding another bedroom, or expanding the living room), these improvements will allow you to ask for more rent, and will possibly make you more profit.

Choosing to pay more in maintenance costs also lessens the amount of money available for capital improvements.

Try to think of government that way.

In case you can’t figure it out, pensions are a maintenance cost.

[Author]

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