Lesson 1: Economics, the 'markup'

[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.

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]

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]

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.

[B17a]

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!

[Z_Fan]

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]

welcome to capitalism buddy..

[Redlyne_mr2]

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]

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]

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]

MARX'S ECONOMIC THEORY OF SURPLUS VALUE

He saw this a century ago...

The Communists are coming!

[rage2]

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.

[A_3]

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"

[stockEK]

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.

[T5_X]

This is what we get living in a society that is built upon greed.

[20incheyes]

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.

[ehos]

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
right?

[ehos]

[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]

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]

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







Joke!

[stockEK]

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.