Leveraged Buyouts – what a crock

When you borrow money to buy something, it’s not uncommon for the thing you bought to be used as collateral for the loan. The obvious example is a house mortgage – you borrow money, the house is the security. This makes the act of borrowing itself reasonably risk free: if the purchase falls through, the loan is dissolved and all you’re out is some administrative fees. Your real risk starts when the purchase is successful.

TL;DR – Borrowing money to buy a house is to leveraged buyouts as a pat on the cheek is to a punch to the testicles; same general act, very different implications.

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Warning: get off housing gravy train – ABC News (Australian Broadcasting Corporation)

There’s an opinion page on the ABC News page about the increasing rise in house prices (and the subsequent fall in housing affordability). The solution presented: build more housing (not necessarily houses – apartments are okay too), thus increasing the supply. Unfortunately, that won’t help.
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Wage growth does not automatically equate to inflationary pressure…

One of my coworkers tossed out this line today: “We can’t just increase the minimum wage, because that would cause inflation”. I said at the time that didn’t have to be the case, and I just thought I’d capture my reasoning in writing.
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IMS Australia – first thoughts

Well, it’s about time, but Apple have finally rolled out the iTunes Music Store to Australia. Now I can see what all the fuss is about.

I can see that I am impressed with how easy it is – I’ll have to make a point to not impulse buy, because it’s just so easy to do. The integration with iTunes is so smooth as to be unbelievable – it is very easy to see that this is why they make iTunes and why it’s free. (Heck, the only reason I run Windows on my home PC instead of Linux is to use iTunes)

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My blog is worth that much?

From Jason Yip:


My blog is worth $20,887.98.
How much is your blog worth?

And if anyone wants to buy it at that price (that’s US currency, of course), please feel free to let me know. Contact me before the end of 2005, and I’ll even through in a 10% discount… afterwards, of course, the price may be even higher, as I’m always making new value on the site.

Serious offers only, naturally. No tire kickers.

More on income diversity

An off-hand statement in the editorial of The Australian today went like this:

Even after the threshold changes in the May budget, the top 5 per cent of taxpayers are going to be paying a quarter of Australia’s net income tax

(Look in the section about Peter Costello)
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Income diversity

To quote the New York Times

This week’s census report showed that income inequality was near all-time highs in 2004, with 50.1 percent of income going to the top 20 percent of households. And additional census data obtained by the Economic Policy Institute show that only the top 5 percent of households experienced real income gains in 2004. Incomes for the other 95 percent of households were flat or falling.

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