It’s the great American contradiction.
In one breath, the nation begs for help. Millions can’t afford rent. The only way they’ll keep a roof over their head is if it’s deemed illegal to take it away.
It’s a sad tale.
But in the next breath, the nation boasts about its great tech ventures… and the massive wealth they’ve created.
Facebook told us last week its profit soared 98%.
Amazon saw sales jump 40%.
Apple boosted its second quarter bottom line by a full billion dollars over last year’s figures. Its shares have gotten so expensive, it’s now splitting each one into four new shares. (That way it can buy back even more!)
Google beat its earnings estimates by more than 20%.
All told, these four companies raked in more than $28 billion in profit over the last three months. They drove the Nasdaq to record highs.
It makes us scratch our head and wonder whether the country really is going broke… or our priorities are just all wrong.
Surely there’s a sad correlation between evictions and Facebook’s profit doubling.
But, meh… we’ll let the government worry about such things. Surely the grilling the boys on Capitol Hill gave these tech wizards last week will fix it.
We need to turn to the mailbag…
Free Rent? Is There Such a Dream?
And – oh look – some commentary on how the government is muddling things up once again.
Rather than issuing edicts about matters they do not understand, the government ought to respond to the citizens. Everyone takes a loss on investments at some point. Landlords know what their own financial situation is. They know whether they have good tenants. If possible, it would be both a kindness and good business to lower the rent for a time in order to retain them. Governments could respond to this by discounting the property taxes accordingly. – Reader K.D.
We received a lot of comments about our piece on Friday. Most readers agree extending the eviction moratorium will ease pain today… but create a heck of a lot more tomorrow.
We like this note from K.D. because it gives a lovely tip of the hat to Mr. Market.
Let the owner – not the vote-addicted government – decide who’s worthy of a discount. Let the fellow with his life’s savings on the line decide whether getting just $500 this month from a good renter is better than getting nothing from a bad one.
As for the notion of cutting taxes… ha.
Out of the trillions of dollars spent in stimulus in the last five months, virtually none of it has come in the form of tax breaks.
Washington would rather print.
Uncle Sam, after all, needs rent money of his own.
Kind of silly if we stop to think about it.
Digging deeper in the mailbag…
Wha wha, poor little boy. You added a structure on your property and you were asked to report it and later your overall assessment went up. Hello! Why should you be different from anyone else in that regard? Feel you were singled out? Highly doubt it.
And how much exactly did your assessment go up? And what is the consequential impact in your overall property tax, $20 or something?
Some of your columns are interesting but when you go down the whining path with a self-indulgent diatribe, it’s a total turn-off and very silly. Need to grow up!
The world is in chaos, and your $20 of additional taxes isn’t worthy of press time. – Reader A.A.
Oh… we disagree.
It’s not that we were singled out. We weren’t. And it’s not the fact that most folks ignore such reporting laws and never pay a dime more in taxes.
Nope, that’s not it at all.
What’s got our feathers ruffled is the very thing you point out… that the world is in chaos. And it’s in chaos because of silly things like this.
It’s one giant cycle, and it’s spinning out of control.
The government needs cash to pay somebody’s rent… It taxes us and our neighbor to get it… We pay, but our neighbor hides his new shed… The government hires goons to drive around and find his shed… They need money… We pay more taxes… Our neighbor doesn’t… They pass more laws… We pay more… He doesn’t… More laws… More taxes.
Eventually the little guy tosses up his hands.
And when he does… he either sticks his hand out and asks for some free money of his own or grabs a pitchfork and demands change.
Don’t believe us?
Turn on the news… or hear from a fellow reader firsthand.
Just wanted to let you in on some things happening in our little corner of the world.
Our company sells equipment and supplies to a few of the hardrock mines in SE Alaska.
We get a little glimpse of the gold rush from a different angle.
The rush is on! The mines we deal with are going full-on production.
Replacing, repairing and updating equipment at any cost. “Tons per hour” is their battle cry. Dig, dig and dig.
Another interesting thing happening is exploratory drilling – we are currently working with three new companies that are either in exploration or pre-production phases of gold and valuable metals extraction.
The only things holding back all of this wonderful production are the burdensome regulations and the constant barrage of hate and lawsuits coming from the “anti-everything” crowd. Most new exploration shuts down before they even start because of the organized anti crowd. In spite of the resistance – mining for gold is heating up!
Must be one heck of a demand – just sayin’. – Reader J.B.
Good stuff, J.B.
We hope our paths cross next time we’re in Alaska.
This note smacks of so much of what we muse about in these essays. Regulations and the dependence they create are tearing apart the thread that binds this nation.
What’s even more telling is that the demand for gold is soaring.
The price of the currency of currencies is hitting record highs.
Why? Because Apple is selling more iPhones?
No… it’s soaring because the government is cutting rent checks it too can’t afford.
Like we said, it’s one big cycle, and it’s spinning out of control.
What’s our solution?
Should we duck and cover? Should we sell it all and wait for the collapse?
Nope. It’s just the opposite.
Things like this take years to unfold. With so much free money being shoved into the economy, we’ll see asset prices soar just as a car’s motor revs higher before it sputters out of gas.
Dow 100,000 will come long before Dow zero.
Our final piece from the mailbag proves it…
Andy, The PayPal rollover play allowed me to donate $1,000.
Net P/L $2,691. – Reader J.G.
And would you look at that… a quick triple-digit win and a person doing some good with it… without coercion from the state.
It’s proof it’s not too late to save this ship.
Buy gold. Buy stocks. And do some good for the country.
P.S. Keep the questions and comments coming. Send an email to firstname.lastname@example.org.