View Full Version : Lesson 1: Economics, the 'markup'
Does it seem like things are overpriced and wages aren't enough? I mean, a house costs 200K, and some guy at MacDonalds makes $6.
He would have to work 20 years to pay it off working everyday (interest etc). And that's not counting ANY other expenses.
20 Years! Yet, if he started working with his hands, he could build his OWN house in how many years? Not 20 that's for sure. Of course he would have to sustain himself etc. But isn't something outta wack here?
Back in the day, sure things made sense, wages haven't kept up with price of goods (especially the most vital one, real estate). Why is that?
It's because of 'markup'. It's all about the 'markup'. Every little thing in a capitalistic society is hit with this devious little manipulation.
And the sad thing is (IMO) it only works AGAINST the consumer! Always. Buy a new car, get the mark up. BUT, try to sell it and you can't get your money back. Same for houses (but not as bad). If a builder builds a house, he puts 100K and marks it up to 130-150K. WTF.
Then the consumer buys it for 160ish and thinks he's getting a deal.
Sorry for the long rant. Just wondering how to fight this markup? Build my own house?
ninjak84
03-16-2004, 04:09 PM
A mortgage for a $200k house on a $6/hr salary to be paid off in 20 years sounds great to me. Add in another 10 years assuming he pays living expenses.
Maybe I'm just seeing it wrong, but can a McDonald's worker really expect more?
I think those of us who go to school and make $50/hr deserve to buy bigger/better houses and pay them off faster.
Loose
03-16-2004, 04:17 PM
Did you think up your rant yourself. If so, you're gay!
If the there was no markup in the world, McDonald's couldn't afford to pay their employees and faggot would be out of a job.
Yeah, if you want to avoid 'markup' go live in the sticks like a hermit and never buy anyting again.
Welcome to the real world! How else are you supposed to make money? If I buy product A for $1 and sell it for $1, I make nothing, probably lose money if I have to carry the inventory for a while with interest costs. The builder has to be compensated somehow, he's the one taking all the risk getting it built, he takes on the risk of fluctuating lumber prices, he takes on the risk of getting laborers.
BTW, Loose, too funny! :rofl:
Z_Fan
03-16-2004, 04:18 PM
I'm thinking if you make $6 an hour you're not even going to qualify for a mortgage on a 200k home.
Besides, you'd be foolish to do that anyhow! You'd be smarter thinking about 130k condo or something that actually wouldn't completely kill your cash flow.
But you're very right. Mark-up is a nasty thing. Most things are marked up 300 - 2000% some even higher. What you need to do is get yourself on the other end of stick. So you purchase something for $100, and sell it for $400 after 'performing' your work on it.
Houses are massive rip off. I figure I could build a 1100 sq ft. Bi-Level for about $60000. (Fully developed up and down). You'd pay like $210k for that...
Shaolin
03-16-2004, 04:26 PM
welcome to capitalism buddy..
Redlyne_mr2
03-16-2004, 04:38 PM
As Z-fan said you need to get yourself on the other end of the stick. Don't buy brand new cars buy used at a good price drive it then sell it for more. One good thing about Calgary's housing market is that prices are constantly going up so as long as you buy right youre guaranteed to make some decent money on your home.
Akagi Redsuns
03-16-2004, 04:39 PM
That's how the real world operates....profits, more profits and more profits.....profits that never end. Look at what professional athletes are being paid, actors, all because people don't mind spending the $14 for a movie ticket or $100 to watch the Flames play.
And of course, I love hearing the earnings of banks and oil companies :)
Ah well, one day I will be on the right side of the equation. Be a seller or a middleman...not the buyer. Then markup is your friend and a ticket to more $$$
benyl
03-16-2004, 04:52 PM
Z_fan, where you gonna build that $60,000 house? Land is what costs a lot of money.
Anyway, ehos if you don't like the system, nobody is telling you to live here. Why not go to Cuba or China and try out communism where wages are fixed and so are the prices of goods.
Weapon_R
03-16-2004, 04:54 PM
MARX'S ECONOMIC THEORY OF SURPLUS VALUE :eek:
He saw this a century ago...:zzz:
The Communists are coming!
rage2
03-16-2004, 04:59 PM
Originally posted by ehos
Does it seem like things are overpriced and wages aren't enough? I mean, a house costs 200K, and some guy at MacDonalds makes $6.
If I got paid $6/hr, I'd be on crack to buy a $200K house. If McDonalds Employee plans on making $6/hr for the rest of his life, he should look into renting something that's super run down instead of buying a $200k house.
As Shaolin said... welcome to capitalism, that's how the economy (ec-o-no-my) works. Supply and Demand, the producers makes the product and sells it at a greater price, if the consumer does not want the product then there is no demand thus no profits and the producer goes under, if there is demand for the product the producer can mark the product up until no one will pay the price anymore... Sure there might be inflation in our society but that's the way the economy works. But ya know if your not about Capitalism i hear bardering is pretty popular in Russia... "So i will give you three of my cows for your Yugo", "make that four and you got yourself a deal":dunno:
stockEK
03-16-2004, 05:07 PM
What bank is going to approve a mortgage to a guy making 6 bux/ hr?
I think this is your first mistake. You are assuming this could be done.
Life is not fair. Either accept your postion in life, or strive for a better one. Its your choice.
This is what we get living in a society that is built upon greed.
20incheyes
03-16-2004, 05:14 PM
the markup goes to people who usually are trying to get you a good product so you keep buying form them, it's those assholes in Ottawa/Edmonton who take a percentage of anything you want to buy or do, it's amazing how much cash they take from us, and what they do with it.
Some of you need to 'read' more and post less.
The wage/house was just an example (it doesn't matter what I own or what I do, but if you wanna find out, check out the marketplace, I'm pretty sure I own nicer cars and a better house than 99.9999999% of you). Even if it's your parents house and your parents cars.
The point is, not that there's a markup, but why so much? Especially on houses? I'm happy I have mine, but just thinking about it on the flip side for the poor punks coming up (which most of you probably are).
But I guess
:whocares: right?
[i] thus no profits and the producer goes under, if there is demand for the product the producer can mark the product up until no one will pay the price anymore... [/B]
I think the problem is consumers themselves. They buy ANYTHING. Or they are so conditioned to buying crap, that they 'must have it'.
People buy fucking bagged french fries! Or special 'ice' salt ! My stupid neighbour was sprinkling this crap on ice, and it's JUST SALT!
I think people always just want the easiest, softest answer out (and there's always someone ready to sell you the easy answer).
rage2
03-16-2004, 05:34 PM
Originally posted by ehos
I think people always just want the easiest, softest answer out (and there's always someone ready to sell you the easy answer).
And that's why those companies are usually so successful. North Americans are lazy, they hate to figure stuff out, the less the thinking, the more attractive the product, the higher the markup.
Lesson 2 in economics :).
Loose
03-16-2004, 05:35 PM
Originally posted by ehos
(it doesn't matter what I own or what I do, but if you wanna find out, check out the marketplace, I'm pretty sure I own nicer cars and a better house than 99.9999999% of you). Even if it's your parents house and your parents cars.
Holy shit man ur a big baller man i wish i had your life.
Better than 99.9999999% of us! that's like you being the best out of 1 billion people! Holy!!!
Where do we sign up to suck your :eek:
http://u2qt.com/gallery2/oval009.jpg
http://u2qt.com/gallery9/eclipse001.jpg
Joke! :clap:
stockEK
03-16-2004, 05:53 PM
Originally posted by ehos
The wage/house was just an example (it doesn't matter what I own or what I do, but if you wanna find out, check out the marketplace, I'm pretty sure I own nicer cars and a better house than 99.9999999% of you). Even if it's your parents house and your parents cars.
So you are doing better than most of us, yet you're still pissed?
IF you are as successful as you say you are, you should have this stuff figured out. OR are you a trust fund baby, or did you win the lottery or something?
Originally posted by ehos
The point is, not that there's a markup, but why so much?
Because people will pay it. YOU apparently pay it. Supply and demand. Is that not the first fucking thing you learn in a business/ economics course?
Originally posted by ehos
Especially on houses? I'm happy I have mine, but just thinking about it on the flip side for the poor punks coming up (which most of you probably are).
Well, I'm sure the "punks" really appreciate your concern.
benyl
03-16-2004, 05:55 PM
North Americans are fad followers.
SUVs are the prime example. Before that it was the minivan. And what about those station wagons from the 70s and early 80s.
SUVs and truck are the most profitable thing Car manufacturers make right now.
Supply and demand drives the price.
Another one is Juicy clothing. Who pays $200 for sweat pants that you can buy for $10 from the supplier. You are paying J U I C Y.
People are dumb. Manufacturers are smarter, that is why they make money.
Why do our banks need to make over 3 billion dollars? Because people stand for it.
Haha, we need a revolution like the French Revolution!
Originally posted by benyl
Haha, we need a revolution like the French Revolution!
STORM THE BASTILLE!!!
Super_Geo
03-16-2004, 06:17 PM
Originally posted by ehos
He would have to work 20 years to pay it off working everyday (interest etc). And that's not counting ANY other expenses.
20 Years! Yet, if he started working with his hands, he could build his OWN house in how many years? Not 20 that's for sure. Of course he would have to sustain himself etc. But isn't something outta wack here?
So say you want to build your own house. I guess you can start with a civil engineering degree. There's 4 years, and $30,000-60,000 depending on the institution. Now buy a section of land, which can cost quite a bit.
You wouldn't want to buy lumber from a store... only an inbred idiot would do that and pay the markup. But to get lumber, you'll need an axe to chop down trees with. Anyone who wasn't born yesterday knows that all axes have markups on them... so, knowing the bright inquisitive guy you are, you'll probably want to make your own axe. Well, that's no big deal at all. All you have to do is dig until you hit some ore.
I don't know about you, but I wouldn't want to buy a shovel from a store (markups... they're fucking everywhere! what a society full of self serving money grubbing lepers!), so you can start with a rock and dig...
......
......
......
Your rant is quite possibly the most naive thing I've ever read. Please, do the rest of the world a favor and get an education.
i will only say 1 thing.
Markup pays the wage of the mcdonalds worker.
Super_Geo
03-16-2004, 06:46 PM
Originally posted by ehos
The wage/house was just an example (it doesn't matter what I own or what I do, but if you wanna find out, check out the marketplace, I'm pretty sure I own nicer cars and a better house than 99.9999999% of you). Even if it's your parents house and your parents cars.
The point is, not that there's a markup, but why so much? Especially on houses? I'm happy I have mine, but just thinking about it on the flip side for the poor punks coming up (which most of you probably are).
So your $6000 VW and $11,000 Eclipse is better than what 99.999999% of Beyond members own? Sorry Donald Trump, I didn't know we were in the presence of such a high baller :rolleyes:
I really like your exquisite garage. Did you import that concrete from Italy or Spain? And I like the foam insulation that just sticks out in plain view. In my garage, I have walls covering it... but then again, I'm obviously not as rich as you (I mean... how many people do you know that are rich enough that they can spend all the extra money required to not finish development on their garage? I know 99.9999999% of the people I know can't). Who did the interior styling in your garage? I sense a bit of French influence, but I can see how some prominent Italian artist could have done the work.
http://u2qt.com/gallery2/oval009.jpg
That's the stuff I have for sale, in other words the SPARE stuff. What are you driving?
Oh wait, this coming from a guy who can't afford an eye exam and bitches about being fired from a 400/week job.
Come on dude, get a job.
Originally posted by Super_Geo
So say you want to build your own house. I guess you can start with a civil engineering degree. There's 4 years, and $30,000-60,000 depending on the institution. Now buy a section of land, which can cost quite a bit.
Your rant is quite possibly the most naive thing I've ever read. Please, do the rest of the world a favor and get an education.
So, you're telling me I need an Eng degree to build a house? Only civic engineers build houses? What planet are you from? Do framers and cement layers have CIVIL degrees?
Did people in the past have civil degrees to build houses? What kind of joke is this?
I'm the naive one do you know anything about the real world and the people actually build houses? They're NOT civil engineers you tool.
I think you need to start reading your books more closely.
Originally posted by Super_Geo
I really like your exquisite garage.
Do you even own a garage? I mean yours, not your parents you tool.
Super_Geo
03-16-2004, 10:07 PM
Originally posted by ehos
That's the stuff I have for sale, in other words the SPARE stuff. What are you driving?
Nothing, I'm in university getting a damn good education.
Oh wait, this coming from a guy who can't afford an eye exam and bitches about being fired from a 400/week job.
Haha, what did you do? Search through all my posts? Well Sherlock, I was just checking to see if AHC covered eye exams, cause why pay when you don't need to. And that $400/week job isn't too shabby when you're going through school... getting paid to go white water rafting and camping with French kids was a sweet deal.
I'm completely comfortable with my stage in life, dude. I haven't had to go post on the internet about how much better I am than everyone else on the 'net yet :rolleyes:
What about you? You seem to believe that you're pretty successful... what do you do? What's your career? And how is it that your views on society are so simplistic and naive?
Super_Geo
03-16-2004, 10:09 PM
Originally posted by ehos
So, you're telling me I need an Eng degree to build a house? Only civic engineers build houses? What planet are you from? Do framers and cement layers have CIVIL degrees?
Did people in the past have civil degrees to build houses? What kind of joke is this?
I'm the naive one do you know anything about the real world and the people actually build houses? They're NOT civil engineers you tool.
I think you need to start reading your books more closely.
Farmers and cement layers don't have civil engineering degrees, but if you want to build a nice house (and for $200K in Calgary, that gets you a decent house) that's more than a square box with a triangular roof, you'll need to have some engineering knowledge.
Cement layers don't design the house, thus they don't need the degree. They just lay the cement.
Originally posted by Super_Geo
Nothing, I'm in university getting a damn good education.
I'm completely comfortable with my stage in life, dude. I haven't had to go post on the internet about how much better I am than everyone else on the 'net yet :rolleyes:
What about you? You seem to believe that you're pretty successful... what do you do? What's your career? And how is it that your views on society are so simplistic and naive?
What kind of education are you getting? The one that tells you that you need a CIVIL degree to make a house?? Get out into the real world and see whos' making the houses, roads etc of this world. The Civil eng just signs off the papers of his techs. You do know that right? Or didn't your profs teach you that?
Didn't you just search through my posts and post MY stuff? Whos' the one who has no life? Kettle, pots black?
And why make up stories about a job you got fired from? Come on man, face reality.
Super_Geo
03-16-2004, 10:10 PM
Originally posted by ehos
Do you even own a garage? I mean yours, not your parents you tool.
Yes, the house that I'm living in right now does have a garage. And it does have walls that covers the insulation :rolleyes: And no, I don't live with my parents.
Originally posted by Super_Geo
Farmers and cement layers don't have civil engineering degrees, but if you want to build a nice house (and for $200K in Calgary, that gets you a decent house) that's more than a square box with a triangular roof, you'll need to have some engineering knowledge.
Cement layers don't design the house, thus they don't need the degree. They just lay the cement.
Back tracking? So you're saying a nice house can't be built without an Eng degree? Face reality, you know nothing about construction.
Originally posted by Super_Geo
Yes, the house that I'm living in right now does have a garage. And it does have walls that covers the insulation :rolleyes: And no, I don't live with my parents.
'Living' in or owning?
Is it YOUR garage or a figment of your imagination? I thought you were a student? And you were happy with the 'stage of life' your in?
What stage? The ignorant one?
Super_Geo
03-16-2004, 10:14 PM
Originally posted by ehos
Back tracking? So you're saying a nice house can't be built without an Eng degree? Face reality, you know nothing about construction.
How am I backtracking? I'm saying that for a $200K house, which is what you stated in your example, you will need to know some form of engineering to make it safe.
What do you think happens when a house is built? A gang of cement layers show up and just start build away? Who do you think designs the house prior to all this? :rolleyes:
Originally posted by Super_Geo
Nothing, I'm in university getting a damn good education.
Wait, the same education where you fall asleep in front of the prof?
Yeah.. :banghead:
Originally posted by Super_Geo
How am I backtracking? I'm saying that for a $200K house, which is what you stated in your example, you will need to know some form of engineering to make it safe.
What do you think happens when a house is built? A gang of cement layers show up and just start build away? Who do you think designs the house prior to all this? :rolleyes:
What? Cement layers? Is that the only people in your little world? You do know there's more than cement in this world? Or is that all the Civil eng info you know?
Do Civil Engineers design all houses? Is that what you're saying now? So nobody can design a house without a civil degree?? (Just to give you a hint, most of the houses here are not designed by civil engineers).
Thought I'd help you out there, your brain seems taxed.
Super_Geo
03-16-2004, 10:19 PM
Originally posted by ehos
Wait, the same education where you fall asleep in front of the prof?
Yeah.. :banghead:
You bet. I fall asleep in front of the prof, I go to about 10 of the 30 hours of lectures I have each week, and in the end I'm still on the Dean's Scholar list in engineering physics at Queen's university. :thumbsup:
Super_Geo
03-16-2004, 10:22 PM
Originally posted by ehos
So, you're telling me I need an Eng degree to build a house? Only civic engineers build houses? What planet are you from? Do framers and cement layers have CIVIL degrees?
Originally posted by ehos
What? Cement layers? Is that the only people in your little world? You do know there's more than cement in this world? Or is that all the Civil eng info you know?
I don't see why you're so confused. Come on, you're smarter than that. I'm using the point you brought up earlier (you know, the one about cement layers and how they don't have civil degrees), and then you're trying to twist it around as if I'm saying that there's only cement layers in the world.
:rolleyes:
Super_Geo
03-16-2004, 10:28 PM
Originally posted by ehos
'Living' in or owning?
Is it YOUR garage or a figment of your imagination? I thought you were a student? And you were happy with the 'stage of life' your in?
What stage? The ignorant one?
Haha, well ok I guess you got me there. I don't own the house I'm living in right now. I'm just a tenant. But then again, I didn't go around posting that I'm more successful than 99.999999% of the people on this message board.
And yes, I am happy with my stage in life.
And ignorance? Look at the first post in this thread. There is nothing more definitive of ignorance than that.
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