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2019-09-16 14:05 by Karl Denninger
in POTD , 65 references
 

 

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2019-09-16 12:01 by Karl Denninger
in Consumer , 140 references
[Comments enabled]  

No, really.....

The WSJ has published what anyone with a modicum of intellect had to already know -- that Spamazon has "doctored" it's search results to favor products which had the highest return for Amazon, whether their product or a third-party "partner" listing.

Of course this goes on all the damn time in various industries.

Let me give you an example: Real Estate.

Go to sell your house and all the "helpful" Realtors will suggest this or that which you should do before listing.  All of them cost money, of course.  Now some are very low-risk -- such as painting any room that shows signs of wear on the walls.  They're low-risk because the choices you would make are probably the ones that a buyer would make, and the buyer is likely to do the same thing.

Not so for anything else, but here's the rub -- all of them get tagged with an extra 6% "sales tax" in the form of Realtor's commission on the improvements you make before listing, which is not to either your or the buyer's advantage, and further it runs the risk of a reassessment on sale which hurts the buyer forevermore in the form of higher property tax bills!

Let's say you sell your house "as it sits" for $250,000.  The buyer knows the place needs interior paint, carpeting in a couple of rooms, and maybe the tile in the kitchen and baths could use a replacement.  It's all functional but a few have hairline cracks in them, etc.

Ok.

So said Realtor will, before you list it, tell you to do those things.

Wait...... who's interest is that in?  The Realtor's; it is to everyone else's direct disadvantage.

Think about it -- let's say I replace the floor tile in my kitchen.  Ok, I spend $3,000 having that done.  Now someone comes in and doesn't like the pattern, and thus doesn't buy the house.  I just lost a transaction!  By the way, that just happened with me -- I looked at a place that I liked except for the flooring replacement the seller had just made.  I therefore valued that replacement at zero since to suit me I'd have to do it over again.  The seller still has his house and I still have my money.

But what if the do like the pattern?  All is well, right?  Uh, not really.  I might get $3,000 more for the house this way (since it really is an improvement according to the buyer -- and assuming the buyer gives me full credit for the expense I undertook) but the Realtor got 6% of that $3,000!  That's $180 that the buyer paid for..... nothing.

Further, the $3,000 might wind up in the assessment since the total sales price is reported.  If the buyer closes and then has the floor replaced the same $3,000 comes out of the buyer's pocket but the 6% tax from the Real Estate agent doesn't and it also can't show up in the assessment since such work is not subject to a permit and thus doesn't get reported in same.

Now this is definitely not the case for things that are structural; for example if the roof needs replacement or there's a problem with the foundation, well, then you got a different game entirely because the property is generally not marketable without the fix.  The bank won't underwrite a mortgage, for example, so now you're limited to cash buyers which is going to have a material impact.  So when you get to issues that prevent mortgage underwriting you're now in the area of things that must be done, because nearly everyone who buys real estate does in fact take a loan.

But for cosmetic things - like that older, but functional refrigerator - this is simply never true.  You never get back every dollar you put into a remodel or improvement in any house, ever.  Look at the percentage returns in that link -- "It's worth the money you spend!" on a new roof supposedly -- yeah, 68.4% of what you spend, plus the Realtor gets to extract 6% of the increased price in what amounts to a sales tax on the work.  The people who wrote that article should have gone to prison for it as it the claims of it being "worth it" are flat-out false as documented by their own data in the same article!

In other words if you are remodeling because you want it, for you, to live in the house then have at it.  That's perfectly fine; you are getting utility value from the improvement which, one would assume, equals or exceeds whatever you're doing.  But in basically every case if you're doing it with the intent of immediate or near-immediate sale of the property (e.g. within the next couple of years) you're going to lose a very material percentage of what you put in -- every single time.

How does this apply to what Amazon is doing?  It applies exactly to what they're doing; it's just a computer doing it instead of some smiling cute individual.  Every bit of their "advice" and its "propriety" is aimed at them, not you.  And why shouldn't it be?  They're not in business to lose money.

Where the line is crossed is when an entity with whom you have a relationship makes a recommendation that is per-se false.  That is, when a Realtor tells you to do "X, Y and Z" to make the house sell faster knowing that you will not recover the invested funds and that they will get a 6% "sales tax" on the increased price they're flat-out screwing you out of thousands so they can make a few hundred more bucks.  Since they're professionals this ought to be felonious and result in people going to prison, but of course it never does.  The house will sell just fine with the older tile in it -- at a price that reflects the new owner replacing it at a time of their own choosing with a product and pattern of their choosing.  Ditto for the new refrigerator, stove and similar.  Never mind that for major appliances in particular (stoves, refrigerators, washers, dryers, etc) timing can be everything; it's not at all hard to get a 20 to 30% discount on price (and sometimes more) if you wait for a sale and if the older, less-pretty one is perfectly functional why wouldn't you as a buyer do exactly that?  Who in their right mind likes overpaying for things on purpose?  I did exactly that 10+ years ago when I replaced my washer and dryer; the old ones worked but were ugly.

Likewise, when Amazon claims it is returning the "most relevant" search results and isn't; if it is instead returning those that are most profitable to Amazon then Beelzebezos should be charge with felony consumer fraud and tossed in prison.

Each of these schemes individually is worth a few pennies, dollars, or hundreds of dollars.  But collectively, over the entire base of transactions in a given year, it's worth billions that are siphoned off.

There is nothing wrong with salesmanship and trying to make a profit -- that's called business, and is both lawful and expected.  That does not extend to deliberate falsehoods, whether by act of omission or commission, that screw people.  Those are supposed to result in criminal charges -- but today in the world where "asset prices" such as houses and stocks must always go up they never do because taking the screwing out of the transaction is likely to interfere with that continual asset price increase.

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2019-09-16 07:00 by Karl Denninger
in Health Reform , 186 references
[Comments enabled]  

C'mon folks, cut the crap.

Their money problems began when the University of Virginia Health System pursued the couple with a lawsuit and a lien on their home to recoup $164,000 in charges for Waldron’s emergency surgery in 2017.

The family has lots of company: Over six years ending in June 2018, the health system and its doctors sued former patients more than 36,000 times for over $106 million, seizing wages and bank accounts, putting liens on property and homes and forcing families into bankruptcy, a Kaiser Health News analysis has found.

The problem isn't that hospitals don't have a right to be paid for their work.

It's that they think they have a right to be paid 2, 3, 5 or even 10x as much if you don't have their "preferred" insurance plan and, in some cases, they affirmatively allow people not covered under such "insurance" to treat you when you're unable to choose to consent or not.

How is this sort of crap legal?  Refusing to give you a price up front and then charging you some multiple of the next guy over with the exact same problem simply because you didn't feed their favored monster first?

And let's not forget -- this is a taxpayer funded and state-supported institution -- not a "for-profit" company.

So it's the government itself that is screwing you after effectively extorting you to spend money on so-called "insurance."

There's no point in ever asking politely for a government or other agency -- private or not -- to quit hosing you.  Tyrants, no matter their form, only respond to a demand backed up with an effective "or else."

Well?

There are answers -- like here, for instance.

But until that sort of change is demanded, with an or else that is of at least equal threat to that posed by those who are engaged in this nonsense it is not going to go away.

I can only conclude that the American public likes the buttsexing that UVA and others impose on it.

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2019-09-15 22:18 by Karl Denninger
in Musings , 215 references
[Comments enabled]  

2019-09-15 09:02 by Karl Denninger
in Editorial , 259 references
[Comments enabled]  

Oh c'mon folks....

The new Times story gives the account of a male Yale classmate of Kavanaugh named Max Stier, who alleges that Kavanaugh, at the urging of some friends, performed an obscene act while mistreating a woman at a party.

The Times reported Saturday that Stier told the FBI about the alleged incident during Kavanaugh’s Supreme Court confirmation process but the FBI did not investigate further.

The reason they didn't investigate further is that it never happened.

The alleged "victim" has said she has no memory of the incident.  While it wasn't of a "forcible rape" sort it was, as described, certainly disgusting and the person who it was allegedly done to wasn't blind-drunk at the time either. If I had something like this done to me at some party I would have remembered it 40 years later -- easily.

Oh, and read this -- it makes clear why the FBI didn't run this down.  There is nobody who could provide first-hand corroboration of this claim.  Not one person yet there were allegedly a whole bunch of people at this alleged party.

We already did this smear job during the confirmation hearings.  Now the NY Times and the leftwing hacks who know damn well Ginsburg is about to go take the eternal dirtnap are dredging back up the same bullcrap that was run before and failed to try to stack the outcome of Supreme Court decisions.

If you want to know what sort of baseless garbage half the freaking nation is willing to engage in and what that means when things get dicey in a few years from all the deficit spending colliding with reality you're seeing it right now.  These people will commit others -- millions of others -- to die right here, in this nation.

They would be willing to provoke some other nation or group of terrorist into nuking Americans to get their way.

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