31 Things You'll Never Hear a Texan Say...

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re: " But I say if you cut your own grass instead of paying somebody else to do it, you earned the difference in net worth."
My net worth is zero.
I'm flat broke. Not a dime or possession to my name. I'm squatting on a piece of land owned by some guy in another state who doesn't know about me or my cardboard box.
The grass was getting pretty long. When the family down the block went to church I snuck into their shed and borrowed their lawnmower. My little piece of paradise looks much better.
What's my net worth now? All that work made me hungry. Can I go spend my earnings on some food?
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The $35 I earned instead of spending was more than enough to take my wife out for a nice dinner.
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How does that even resemble an answer to my question?
Where's the $35 I earned instead of spending?
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On Sat, 10 Dec 2011 17:40:45 -0800 (PST), DerbyDad03

Even setting up ridiculous scenarios that have nothing to do with the original scenario won't help you. You'll never run away from plus and minus signs. What you quote above offers two choices: pay expense or do it yourself. So in your new scenario the squatter can become indebted $35 by promising to pay a landscaper later, or do it himself. If he pays, he's $35 in debt, net worth -$35.

Since you (the squatter) mowed it yourself, your net worth is still zero. In other words, $35 more than if you hired it done.

Assuming your credit limit is $35, you can now borrow $35 to buy food. If you hired the mowing, you go hungry. You're tapped out. Why is this hard for you to understand? Do you pay to have your lawn mowed, as BobR did? Check this year's expense for that, which debits your net worth. Fire your mower and do it yourself next year. Then check at the end of next season for that debit. It's gone! And you net worth increased by what's no longer debited. You can then decide if you earned the difference, or it had nothing at all to do with your labor, but was all caused by some wonderful good magic you have no control over. If you already mow your own, hire it done next year, then check how that expense affects your net worth. Then decide if that debit to your net worth is because you didn't mow your lawn yourself, or because it's just some kind of black magic happening out there that you can't control. --Vic
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wrote:

That has got to be the stupidest financial logic I've ever heard.
I'll lay it out plain and simple one last time. If you don't get it after this, we'll just let you go on thinking that you have *increased* your net worth by not spending money.
The numbers just don't get any simpler than this. We don't need any formulas, we don't need to play any semantic games. It's as simple as this:
If you start with nothing and you don't pay someone to do something for you, you will still have nothing. If you then do that "something" yourself, you will still have nothing.
If you start with $1,000,000,000,000 and you don't pay someone to do something for you, you will still have $1,000,000,000,000. If you then do that "something" yourself, you will still have $1,000,000,000,000.
In both cases there was exactly $0.00 change in your net worth.
It's just numbers and you can't fool them even if you have no problem fooling yourself.
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On Sat, 10 Dec 2011 20:58:11 -0800 (PST), DerbyDad03

Man. you've got a thick skull. Your devious examples only work with suckers. You're not talking to Lou Costello here. I showed you how your drummed up penniless squatter scenario doesn't work. Besides net worth, you must think nobody can grasp debt and negative numbers. It's so lame. Above you fail to give an expense to hire your "something" done. You claim it's "just numbers," then fail to provide them. "Something" is "nothing." You can't use a real number because then you'd have to debit the net worth by the expense if the work were hired out. That reveals the difference. You never show the difference because it fails your argument. BobR gave the mowing expense cost to show the difference. I showed an auto wrenching expense cost to show the difference. Not sure why you're doing this - saying that cutting or adding expenses doesn't affect net worth. It's not a good comedy routine. Just a bad cartoon. I suspect you're just yanking chains. Hope so for your sake.
--Vic
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wrote:

Vic,
I can't decide if we are dealing with two total morons or a couple of bozos who think they are in the debate club and will win by scoring point for totally ignorant arguments. In either case, they have proven to be capable of endless idiot arguments that just aren't worth wasting more time on. It would be easy to understand why neither of them would have any net worth since they clearly can't understand that spending money, especially when they don't need to, reduces their net worth.
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re: "I can't decide if we are dealing with two total morons or a couple of bozos who think they are in the debate club and will win by scoring point for totally ignorant arguments."
I agree. Are you and BobR total morons or a couple bozos?
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On Sun, 11 Dec 2011 11:57:22 -0800 (PST), BobR

I don't think they're morons. They just think differently that you and me. Aliens? (just kidding) And you don't have to think a certain way to accumulate wealth. If you have a high income you can spend plenty on expenses and still build up nice net worth. On a lower income you can cut expenses to do the same. It's all relative, and everybody's different. But you can't deny expenses exist. Some people look at a $30k new car as a necessary expense. And maybe it is for them. That's fine. I don't even have $20K in cars in 45 years of owning cars. Because I can choose good used cars and fix them myself. Do I care if others want to buy a new car? Nope. Does it bother me not ever buying a new car? Nope. Has it affected my net worth? Yep.
--Vic
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re: "You can't use a real number because then you'd have to debit the net worth by the expense if the work were hired out."
Good gosh, man, use your brain.
Feel free to insert any offsetting dollar amount you'd like.
Here, I'll do it for you.
If you start with nothing and you don't pay someone $35 to do something for you, you will still have nothing. If you then do that "something" yourself, you will not suddenly have $35, you'll still have nothing.
If you start with $1,000,000,000,000 and you don't pay someone $35 to do something for you, you will still have $1,000,000,000,000. If you then do that "something" yourself, you will not suddenly have $1,000,000,000,035, you'll still have $1,000,000,000,000.
See ya, bye, done, out.
Feel free to throw any and all insults my way, I'm done wasting my time trying to explain simple math to you two.
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On Sun, 11 Dec 2011 12:48:46 -0800 (PST), DerbyDad03

That's your best idea on this yet.
--Vic
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wrote:

He's setting up a "stripped down" hypothetical to make it easier to understand the principles involved.

It's not a question of that, it's a question of what the words "earn" and "save" mean. For a guy who's got such a good handle on writing, Vic, I'm a little puzzled why you're dead set against the distinction DD and others are trying to make. There's a huge difference between "earning" and "saving." If you were really earning money mowing your OWN lawn, the IRS would tax it. They don't tax it because it's just not income. It's easy to prove that because as soon as you mow your neighbor's lawn, the tax people are on your ass. We're talking about government types that go so far as to tax lemonade stands run by kids. If there was any *real* earning, you can bet your bottom dollar the IRS or some other government agency would be taxing it. Mowing your own lawn saves you money but it earns you nothing in dollars.

Pay = transfer of funds = earnings = taxable because it is INCOME to someone DIY = no transfer of funds = savings = non-taxable because it's income to no one - no new money "came in"

Creating a debt = *potential* income for landscaper. It's not really income until the - wait for it - MONEY changes hands. It's a concept at the core of capitalism. People work to get income. People create things (build furniture, sew clothes, etc,) to get income. People invest in things to get income. People *don't* receive any income from mowing their own lawns. If, perhaps you harvested fallen apples and sold them while mowing, you'd be making money but this is not the case.
As soon as you mow someone else's lawn and they pay you, it becomes a true economic transaction where the mower's net worth rises and the mowee's net worth falls - exactly by the amount of the cost of mowing. When money doesn't change hands, "earn" or "make" are just the wrong words to use. To someone who's done a lot of accounting, bookkeeping and economic modeling, to hear "earn" said when "save" was meant grates as much as hearing, time and time again on TV: "He borrowed me the money."
"Save" and "earn" have specific meanings that don't typically include the usage that kicked off this whole magilla. While I am happy to admit that doing your own repairs can have significant economic payback - eventually - that payback doesn't accrue, usually, until a long time after the work was performed. I'm sure you know that you may well be taxed on those improvements when you sell your home based on the value you've preserved or increased. The tax guys have been taxing people since the Pharaohs. They don't miss a "penny earned" anywhere. Mowing your own lawn doesn't generate any wages. Period. There is no earning involved. And the savings are demonstrably lower than what a mower would charge because you have to factor in the mower cost and all the other expenses, risks and wear/tear involved.

Pays with what? Anybody extending credit to a guy with a credit score like that is in reality committing either a charitable act or a stupid one. (-:

Do you do your own taxes? (-: If you do them based on the principles you're stating, I suspect an audit's in your future. You're having a little fun at the zero crossing, but the reality is that paying someone else reduces one's net worth. Doing it yourself doesn't affect your net worth unless you mow a toe off. Why? Because you have the choice to not to it at all, which also doesn't effect your net worth. How do you set a value to an activity that has the same effect on your net worth whether you perform it or not? It's all just definitional. If someone gives you money for working, you've earned it. If you do that work for yourself, you've saved money. No new funds entered your financial picture. If you don't believe me, ask Google:
"I saved doing it myself" = About 5,860 results "I earned doing it myself" = About 2 results "I made doing it myself" = About 5 results
That last result were variations of "the mess i made doing it myself." (-:
People SAVE doing things themselves, they do not EARN.

Wow. That's a pretty big assumption. Do you routinely make those sorts of loans, Vic? In addition to prowling around Chicago fighting crime nightly? (-:
I don't know of anyone who makes those kinds of loans except for sharks. What I do know of the segment of the lending industry that makes loans to people with zero net worth is this: They want a car title or something like it. I believe that's the primary fallacy in this particular argument. Not only can that person not borrow money based on his mowing the lawn, any money he *could* borrow would cost him dearly. If he has no car, no job, no checking account and no phone he pretty much has no chance of getting a loan. Even Western Sky, the Indian lenders, who admit "yes, the money's expensive" would likely turn him down.
What I am saying is that you're really, really reaching to try to turn some guy mowing his own lawn into a recognized "earning" transaction and there's just no basis for it. Nothing was earned. If he promised to pay some other guy and that guy did the work, a debt was created. But until that debt is paid, nothing was actually earned. To earn wages, money has to change hands from one entity to another.

You were tapped out before anything ever happened to the lawn. The only economic value this newly mowed lawn has at this point is the amount the "bad debt" tax deduction is worth to the guy dumb enough to mow on credit for a guy with no assets. He'll may come looking for his money and might throw a rock through the window of the house that guy's squatting in. Or worse. It could be a very costly mowing. (-:

Odd. That's what I am asking myself except in reverse. (-: it's clear that DD, myself and a few others believe it's you and BobR that are swimming very hard upriver but not actually moving.
Money has to change hands for anything to be earned. Not having to spend $35 on something you did yourself *is* saving $35. But no wage-related definition of earned allows money not expended to be income.
This is one of the most rigorously defined areas of economics - and it has its serious downsides. Try convincing a judge to pay you for repair work you did yourself after someone damaged your property. No receipt from a qualified tradesman? Burned. I've been there, done that. You may benefit from the legal theory of Quantum meruit (a Latin phrase meaning "what one has earned") but it would be unwise to count on it. Judges are extremely reluctant to credit someone with doing their own repair or cleanup work for a number of reasons.
One's own labor isn't taxable, it's often exempt from licensing requirements and it's just not considered income. You may *feel* that you're earning money by mowing your own lawn, but you're not earning - there's no flow of income - the hallmark of the earning process. You're simply conserving the money that you already have. That seems a remarkably simple concept to me and I am very surprised that it's not that clear to others.
There are a lot of economic activities that transpire when you do your own work, but earning isn't typically among them unless you've added value by doing it. You're building what is called "sweat equity" when you make improvements to a home you own but you're not earning a cent. No money changes hands UNTIL you sell the property. If you were to make those same improvements to a landlord's property without express written permission, however, not only would you likely NOT be paid for the value of those improvements, you could and probably would be forced to pay to return the property to its original state. If you put in a $500 toilet without the 's permission, you had better have the old toilet ready to swap back. Believe me, loads of renters make this exact mistake and pay dearly for their error. Some judges might give them credit, but most won't. It's simple contract law.

There's the other flaw. Your net worth didn't increase. It just didn't decrease. Very important point. You saved money you already had but you didn't earn any new money. That's savings, not earnings. By definition. You can argue all day that savings and earnings are the same, just as you could argue that ground and neutral are the same. The outcome will still be the same. They are NOT equal.

The black magic in this case comes from faulty assumptions. The rest of the "model" you're describing only makes sense if you buy into the basic, but flawed assumption. Income and earning depends on money flowing into your accounts from an external source. That's basic and why several people have pointed out via various hypotheticals that you can't mow your lawn 24x7 and get rich. Why? No money is changing hands.
When you do it for yourself, the equation changes. Yes, it's worth $35 to *you* to mow it yourself, but not to anyone else. That means you can't earn money for doing it. You can only save money. The cheapest course of action would be not to mow it at all. No time lost, no risks taken, no gas burned, no wear and tear on the lawnmower. Doing it for yourself means you didn't earn anything. You saved, but you were not paid. If the process does not add to your net worth, it's not earning. Period.
This is precisely why people hire nannies. They can pay them $20 an hour while they go to work an earn perhaps hundreds of dollars an hour. That's good old "opportunity costs" stripped buck naked. If you can earn $100 an hour you'd be losing out (strictly economically) by watching your own kids, a "service" that has an established value of in many areas of $20 an hour.
As others have noted, to me, the two hours my guy spends every two weeks working for $40 is well worth the money in reduced bug bites, screwing with lawn tools, stepping in dog poop, breathing leaf mold, a ruptured spinal disc, etc. If I felt like using the time to make money, I could get to a backlog of consulting work. Or I could just have a scotch and soda and supervise.
The only real argument here is whether doing work for yourself is "saving" or "earning." I say that's as obvious as someone calling "hot, neutral and ground" by the terms "Electrified, non-combatant and planet wire." You might be able to figure out what those last three terms mean "hot, neutral and ground" by inspection and logic: The hot is probably the electrified, something neutral doesn't take sides and is thus a non-combatant and the term earth and planet *sort* of mean the same thing, don't they? (-: You could save "Live, uncommitted and dirt" too, and *maybe* be understood.
But years and years of established usage have led most people to use the terminology as DD and I have. When you earn or make money, it add to your net worth. That's all this is about. Yes, mowing the lawn saved you $35, but that's all that happened. It wasn't income if you did it for yourself. It *feels* like you're earning money, but you're just saving money. The action itself does not add to your net worth in dollars. It conserves them. Every taxing authority I know of agrees with that interpretation, so you're trying to climb a very steep mountain arguing otherwise.
-- Bobby G.
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wrote:

You sure put out a lot of verbal diarrhea just to prove that you don't know the difference between Earn (a verb) and Earnings (a noun).
Earnings (Noun)Noun: Definition of EARNINGS 1: something (as wages) earned 2: the balance of revenue after deduction of costs and expenses
Earn: 1a : to receive as return for effort and especially for work done or services rendered b : to bring in by way of return <bonds earning 10 percent interest> 2a : to come to be duly worthy of or entitled or suited to <she earned a promotion> b : to make worthy of or obtain for <the suggestion earned him a promotion>
Most reasonable people can recognize that there is more than one acceptable definition but both you and DD have proven that you are not reasonable so I don't expect you to understand the definitions on either word.
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...A most xxcellent explanation has been snipped...>

Mr. G:
A very wise man named Reinhold Niebuhr once wrote:
"God grant me the serenity to accept the things I cannot change; courage to change the things I can; and wisdom to know the difference."
I suggest that you follow my lead and accept the fact that these 2 gentlemen are not going to listen to reason.
This wisdom will "earn" you some serenity. ;-)
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Along with the definitions from the merriam-webster dictionary that proved you both wrong on all accounts.

If you are speaking of yourself and Mr. Green that would obviously be an accurate statement.
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...A most xxcellent explanation has been snipped...>

Mr. G:
A very wise man named Reinhold Niebuhr once wrote:
"God grant me the serenity to accept the things I cannot change; courage to change the things I can; and wisdom to know the difference."
I suggest that you follow my lead and accept the fact that these 2 gentlemen are not going to listen to reason.
This wisdom will "earn" you some serenity. ;-) =========================================================I remember a long time ago, when I was a "cub" reporter, an interviewee called my editor to complain about an article I had written. I always taped my interviews (with permission) so that I could get the quotes exactly right and this gentlemen complained, when quoted verbatim "That's what I SAID buy it's not what I MEANT!"
Once you encounter that kind of behavior, it's hard to be shocked any further. All I can do is present the facts as I know them. Since I got a 780 on my GRE verbal exam, I feel pretty confident that I'm right about the definition of accounting terms as they've been used for centuries. I'll admit, I make plenty of mistakes, but confusing "saving money" with "earning money" isn't one of them. I've suffered through too many economics, bookkeeping, accounting and business process reengineering classes to entertain redefinition of terms that are absolutely standardized in labor law, accounting, bookkeeping and taxation.
BTW, I prefer this version: Lord, Grant Me The Serenity To Accept The Things I Can Not Change, The Courage To Change The Things I Can, And The Wisdom To Hide The Bodies Of Those I Had To Kill Because They Pissed Me Off So Damn Much.
The truth is that I just don't get peeved enough to care. I rarely engage in more than a couple of rounds of debate because by then you've either convinced someone they've erred or they've convinced you that "face" is so important to them they can never admit to an error. Those types of people often end up telling the story of their web duel to one of their knowledgeable friends who will then tell them "ah, you were mistaken."
Now I have to sign off to write a new brochure to sell on the web:
"Mowing Your Way To Millions!"
-- Bobby G.
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Since you got a 780, you probably could have found a version of the serenity prayer that didn't Capitalize Each Word, Which Is Improper Usage. It makes the reader think that each word is its own sentence. Makes it dificult to read.
--

Christopher A. Young
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Oh, gracious. I've totally messed up. That's awful.
--

Christopher A. Young
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Ask Me If I REALLY Care What A Top Poster Thinks About My Posting Choices . . . (-:

It apparently makes *one* reader think each word is its own sentence. That might not be something I would expect people to confess to as it might reflect poorly on their reading skills and their inability to recognize "title case."
http://en.wikipedia.org/wiki/Letter_case
<<Title case: All words are capitalized except for certain subsets defined by rules that are not universally standardized. The standardization is only at the level of house styles and individual style manuals. (See further explanation below at Headings and publication titles.)>>
I'm Surprised You Would Think These Words Are Sentences When They Are Clearly Absent A Period Indicating The End Of A Sentence. Even. Using. A. Period. After. Each. Word. Would. Not. Be. Really. DiFficult. To. Deal. With! People tend to read in word groups and not single letters or words. Some writers, like ee cummings, are known for their odd "case" work:
Buffalo Bill's defunct who used to ride a watersmooth-silver stallion and break onetwothreefourfive pigeonsjustlikethat Jesus
he was a handsome man and what i want to know is how do you like your blueeyed boy Mister Death
http://www.americanpoems.com/poets/eecummings/11888
-- Bobby G.
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I bow down to your godly self belief.
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