Don't Quit Your Day Job…

Ever wonder how much better a house would be if it was in a better location?  Ever complain about a house because of its proximity to a highway or main street?  Throughout my housing search, I saw numerous houses which hit every mark – except being located on a busy street, or too near a highway.  Post-house search, I saw an interesting web site linked from Redfin’s Bay Area forum.  Yes, there actually is a study measuring how much an increase or decrease in average 24 hour day night sound levels, Ldn, affects the values of a home.

I recently purchased my first house here in the Bay Area, and I did it in a decidedly non-traditional way.  For a few years I had been reading about a smaller real estate company known as Redfin which operated in a more hands-off way than a normal real estate firm.  Redfin leverages technology and a slick user interface to help its users (most of which will not use Redfin to buy a home, but the search feature is that good) find homes on their own.  Once a house is purchased, Redfin actually refunds some of the brokerage commission.  In most places, 3% of the purchase prices goes to the seller’s agent, 3% to the buyers, and 1.5%, 50% of Redfin’s commission, goes back to the end user.  So… what’s the catch?

“In the past, raising the debt ceiling was routine. Since the 1950s, Congress has always passed it, and every President has signed it. President Reagan did it 18 times. George W. Bush did it 7 times.” – President Barack Obama, July 26, 2011.

In the United States, Congress controls the purse strings.  Congress sets the amount of spending that the United States will embark upon, setting the maximum amount with a number called the Debt Ceiling.  The Debt Ceiling is a relatively modern concept – before there was an aggregate debt limit, Congress would authorize borrowing one bill at a time.  In 1939 and 1941 the Public Debt Acts changed us to the system we have today – where maximum borrowing is authorized in the debt ceiling (and consolidated under the Treasury Department) while bills which spend money are voted on separately.

Serious Thinkers™ in all corners of the web return to some common themes, even when those themes are currently out of the public spotlight. Recently, those Serious Thinkers™ have been reading between the lines on topics which the public has moved on from – the effect of the minimum wage on unemployment, and even more to the point, the effect of the minimum wage on specific segments of the population. And why shouldn’t they? The current official unemployment rate is 9.2%, but the official unemployment rate among those with a Bachelor’s Degree or higher is a relatively healthy 4.4%.

In 2006, Former President George Bush signed a well intentioned law which allowed companies to automatically enroll employees in the company retirement program – and to automatically choose the investment in which they were enrolled. The Pension Protection Act of 2006 authorized companies to automatically enroll new participants and enroll them in three types of funds – lifecycle funds, balanced funds, and managed accounts – while absolving the companies of any financial liability for losses in the funds. As expected, the law has effectively increased the rate of participation in company 401(k) accounts.

Sorry to miss the news cycle (I bought a house, as I alluded I might in my slightly pessimistic earlier real estate postings), but I wanted to share the perfect example of the incentives and disincentives of tax laws.  As predicted a while ago, California finally passed a law which stated that any out of state businesses which had affiliates in California would have to collect taxes when consumers in California purchased goods from the mother company.  A few other states have already passed similar laws, nicknamed ‘Amazon Taxes’.  Overstock.com and Amazon.com (disclosure: this site was technically an Amazon affiliate) immediately announced plans to cut off California affiliates.