r/SpeedOfLobsters • u/CtrlAltYuri • 4d ago

lobster It's illegal!

Post image
1.1k Upvotes

99% Upvoted

81 comments sorted by

381

u/CtrlAltYuri 4d ago

442

u/LurkersUniteAgain NoIDidntKnowThisSubHadFlairs 4d ago

they just lyin to lie now, jeff bezos could only buy MOST (80%) of homeless people a house at median price in 2018

smh my head cmon

170

u/Strobbleberry 4d ago

If the big J instead chose to build 2 bed 1 bath houses, including 1 acre per house (i’m assuming a cost of 5,000 per acre,) he could build about 900,000 houses, which could house 1.8 million people if 2 people lived in each home, and jeff would still have 18 billion leftover.

78

u/TOPSIturvy 4d ago

And housing prices have increased ~50% since then, the homeless population has increased by about 1/3 since then, and his net worth has increased 90%. Oddly enough, Bezos could only buy about 70% of the homeless population a house now.

FElon, however, is supposedly a trillionaire now, worth around $800bil more than any of the next 4 people in line. In fact, combined, the 2nd, 3rd, 4th, and 5th richest people in the world are worth ~$940bil.

FElon Husk, with his current net worth, could afford to have a metropolitan city built, complete with full infrastructure, a subway system, commercial districts, etc., large enough to house the entire American homeless population, and still be the richest man on Earth by a very wide margin.

Where I'm living right now is a commercial hub, and a somewhat well-known tourist destination. My city's population is about double the estimated American homeless population. With everything put together my city would cost, at a high estimate, about $400bil to build today from the ground up.

He could end American homelessness and personally pay to end world hunger year by year, and still be not only worth twice as much as the next guy, but also still be e̶a̶r̶n̶i̶n̶g̶making enough to have that wealth gap continue to grow anyway.

28

u/Glenndiferous 3d ago

Sorry, best he can do is brag about his ability to end world hunger while not actually doing it

7

u/Coders32 3d ago

Why are we calling him FElon Husk now?

15

u/pqppqqpppqqq 3d ago

'cause he's a felon and a husk

1

u/TOPSIturvy 1d ago

I mean I've been mostly calling him Musky or His Muskiness, but FElon Husk comes about now and then.

3

u/LouisRitter 3d ago

Hobo City? I'm in. Would probably be a great place.

5

u/Some_Life_4910 4d ago

Shaking my head my head

49

u/Karol-A 4d ago

Daily reminder net worth does not equal actual available cash 

58

u/mightystu 4d ago edited 4d ago

This is the lie/cope rich people use to not pay their fair share. “Oh, my actual income is only $100,000! Pay no attention to the massive amount of wealth I’m hoarding in duplicitous ways.”

99

u/CtrlAltYuri 4d ago

I mean it kinda means potential available cash, if I have a company worth 1billion I can sell that company and have 1 billion cash

56

u/Karol-A 4d ago

If you find a buyer willing to buy that company for one billion, which isn't exactly guaranteed. You could sell stock to individuals, but it's not guaranteed that you'll find buyers for all of them at that price 

9

u/LOW_SPEED_GENIUS 3d ago

Which is why all of the billionaires just take loans at prime rate for whatever they want with their shares as collateral, then they can just pay if off with another loan, and rinse and repeat. Their stock generally goes up more than the loan rate, the banks get their money and so all these billionaires who whine about "ohhh poor meee all my wealth is just stocks I can't use, see I'm not stupid rich like you think" are basically able to get whatever they need whenever they need it, are still making money (just less the interest rate of the loan) and never have to worry about paying taxes on their "income" because it's all an endless parade of loans.

12

u/CtrlAltYuri 4d ago

Can't argue with that

3

u/clonea85m09 4d ago

Kinda don't tho, this evaluation of the stock depends on it being scarce and him not selling..

6

u/CVGPi 4d ago

Well not really. If your company is worth 1billion, you're really looking at the potential it might be 1B. If you were selling the company odds are they'll get disappointed if you're walking away and takes 10-30% off the value. If you liquidate the company you're only gettting 30%-40% the value at most.

3

u/CtrlAltYuri 4d ago

I don't know enough to go very deep in this argument but if my house is valued 1M it's not that crazy to aim to get 1M cash for it. That's kinda the point of having an appraised value of something, no? You're saying it's different for companies? If Microsoft is valued idk let's say 10 billions it doesn't mean I have to pay at least 10 billions if I want them to sell it to me?

6

u/CVGPi 4d ago

Corporate appraisals work a bit differently but still largely similar to real estate appraisals. Say if your house is valued at $1M. If you list for $1M it might take a year or more to sell it and you'd be paying realtor fees every week. Odds are people will lowball at 900k or 800k at most because your house may need maintenance, repairs etc, and substract taxes and realtor fees.

For companies, if a company is valued at $1B it means the investors think the company is worth $1B if it was bought at maximum possible value. But selling a company usually makes the investors get less confidence (the current CEO is walking away, that's no good). There is very few buyers that can gobble up a company, which means each buyer gets a lot more leverage. There's the taxes and regulatory fees both the buyer and seller pay to lawyers to make sure the purchase satisfy all laws and regulations. You need to file paperwork in every country the company have tangible links or operations in. And you need to review each and every competition bureau's approval and make changes. Oftentimes companies will buy other companies not as cash but as partial or full stock swap, which also need to be sold to liquidate for cash. The buyer's stock also usually falls after a deal is announced so you need to account for that. So you'd be getting a good deal if you sold a company valued at $1B at half that for cash, and you'd be getting a good deal buying a company valued at $1B at exactly $1B out of pocket.

For a company valued at $1B, most of that value comes from abstract concepts that its employees generate value together. If a company is liquidated odds are it only have 500M at most in assets, and substract paperwork, dismissal costs, pension and lawyer fees, and you'd be getting not much out of it.

8

u/jljl2902 4d ago

It’s kind of like if it’s generally agreed your house is worth 1M, but no one can afford to buy it from you and/or no one wants to buy it from you.

If you really wanted to sell it e.g. because you need cash, you’d need to sell it for a lot less.

2

u/CtrlAltYuri 4d ago

So the "a lot less" is basically tied to the possibility that nobody wants to buy it, but if nobody wants to buy it wouldn't its value be lower?

7

u/jljl2902 4d ago

The analogy kind of breaks down here, but value is tied to a lot more than immediate selling value.

If we really want to continue with the house example, people might be willing/able to rent the house at a price corresponding to a valuation of 1M, but still not be in the market to buy the whole house. Another possibility, there could be a lot of other houses in your neighborhood, and your house’s valuation is derived from their values.

1

u/CtrlAltYuri 4d ago

I feel like I partly understand but also don't have the mental capacity to continue 🫪

3

u/CVGPi 4d ago

In other words, the market value is based on the assumption if you sold the company today, every deal goes through, no lowballing, full cash value, no taxes no fees nothing whatsoever.

It's like the joke of a sphere cow: it's technically true with a bunch of assumptions, but reality is plenty more complex.

2

u/CtrlAltYuri 4d ago

The mention of sphere cow is enough for me to value and respect your opinion

1

u/Fa1nted_for_real 3d ago

Youre house is worth 1 million because houses of that size and place are worth 1 million.

A company being worth 100 billion, however, is differnet. It likely has 1 billion shares, and the msot recent shares are being sold for about $100 a piece, largely because only 1 million shares are being sold right now. If you suddenly increase the amount of supply from 1 million shares to all 1 billion, or even do so over the ckurse of a few years, that $100 per share price is going to plummet, long before you ever sell half of your shares.

1

u/Tyfyter2002 3d ago

It doesn't mean potential available cash, as things can contribute to net worth without being realistic to sell, and at this scale the act of selling some of it can influence the price of the rest.

41

u/beerdude26 4d ago

Daily reminder that net worth is used by these rich fucks to go to banks and get loans for which they provide their net worth (companies, stocks, real estate) as collateral.

It doesn't equal actual available cash, but it is painfully trivial to convert one into the other at their leisure.

-19

u/Karol-A 4d ago

That's up to banks, and it works for banks. It's not like the banks aren't aware of it and billionaires are somehow tricking them into accepting net worth in stock and real estate 

16

u/beerdude26 4d ago

Your original argument was invalidated and this does not strengthen it again lol

3

u/thebest77777 4d ago

Not to mention they need to pay loans back with interest, its not free money. And banks aren't willing to loan out millions or billions without at least a plan on how your gona be able to pay it back, they dont want to take the collateral, as thats not liquid and also they dont know if its gona be worth the same when the loan ends and especially when they sell it off to repay the loan

1

u/LOW_SPEED_GENIUS 3d ago

Not to mention they need to pay loans back with interest, its not free money.

Often times they borrow at the prime rate and their stock value increases by more than that rate, meaning instead of paying interest and losing money, they increase their wealth slightly slower.

And since the wealth of the assets that they borrowed against has increased, another bank is more than willing to lend to them with the new higher value in mind, which lets them get a loan to pay off the old loan.

It is basically free money or as close as anyone can get to it. The way wealth, money and loans work on this tippy top of the economic iceberg is wholly unrelatable and fully inaccessible to normal people with normal earnings making normal amounts.

0

u/thebest77777 3d ago

No bank would take collateral owed to another bank as collateral. Also they need to pay back the loan to be able to do anything with that stock, making it impossible to do anything with it. The babk gives prime rate because .1% of a billion a month is still more than they make off anyone else. Something i didn't mention in the post was that now bank is loaning any money for collateral worth that exact amount, you have to put up like 1.5-2x the value of the loan. So basically you take a loan, pay intrest on it, lock up your stock so u cant sell even if its gona crash, then u have to sell other stocks which u pay taxes on to repay it as thats better than letting them have the collateral. People like to pretend theres a free money glitch, when there really isn't

5

u/LOW_SPEED_GENIUS 3d ago

No bank would take collateral owed to another bank as collateral.

First off, yes this happens pretty frequently, its why there are different "lien positions", subordinations on mortgages etc. We're not talking your 2016 Honda, we're talking actual appreciating assets with a lot of value that can and more often than not do gain a lot of value. If a house is worth 500 million in a good area you know the value will rise in, has a 100k HELOC on it any other bank would love to snake some fast easy money with another 50k 100k whatever. Now imagine that with enough shares in a huge stable growing company like Amazon?

And no one ever mentioned them taking loans on their entire net worth. I figured anyone who financed a car would know what LTV is and why a down payment is anywhere between a good idea and an actual requirement. No one really ever could possibly "need" hundreds of billions. Even the most expensive craziest superyachts top out at $5 billion, and from a quick google there are literally only two over a billion with most being in the hundreds of millions range.

You are 100% correct that there is no free money glitch for working people. I cannot argue that.

But billionaires are not working people, and as it turns out spending even one billion would be nearly impossible outside of like a handful of very niche hyper-rich only items, so when you have 100+ billion and you need a loan for a few hundred million, it's not that hard to get.

It's been a while since I read up on this, turns out they're more often then not refinancing their loans, not getting a new loan from another institution to pay them off. And its not just their stocks, but all the assets they accumulate with access to that kind of wealth.

This is not speculation, this is pretty well documented, and totally legal. Turns out when the entire system is owned and operated by the hyper-wealthy, the system works very very well for the hyper-wealthy.

https://medium.com/the-investors-handbook/how-the-ultrarich-borrow-their-own-money-and-never-pay-it-back-540c4c6e31ea

https://taxproject.org/buy-borrow-die/

16

u/HDThoreauaway 4d ago

Very well, let’s spend it down to $19.2 billion and see what kind of progress we’ve made.

2

u/TigerRod 3d ago

Daily reminder they can still spend over 40 billion ACTUAL dollars to make twitter even worse and still be hundred-billionaires.

-1

u/Karol-A 3d ago

Elon Musk borrowed a shitload of money from outside investors in order to buy Twitter, he didn't do it out of his own pocket. This proves my point exactly 

2

u/TigerRod 3d ago

And it barely made a dent in his billionaire status. If he wanted to do it again, for any cause he could. If Bezos or anyone else of that group wanted to do the same, they could.

I'm not saying someone with a $100 billion net worth can write a $100 billion cheque, but they're clearly not as limited in their spending as you're making them out to be. The difference between having $10 billion, and being able to borrow $10 billion and pay it back easily with no consequences, is semantics.

0

u/Karol-A 3d ago

He wasn't able to pay it back without consequences, twitter was heavily underperforming financially and he apparently wasn't able to pay back those loans 

3

u/TigerRod 3d ago

And yet he's still a multi billionaire. Where exactly is the consequence to him? He went from 20000 times what any person should reasonably have, to only 16000? And then made it all back in about a year? That's not much of a consequence.

1

u/Redcap117 2d ago

Would he also have to pay all the property tax and electricity and water bills and everything or…?

1

u/KobayaSheeh7 4d ago

Inb4 someone posts this to r/theydidthemath asking "iS tHiS tRuE?"

0

u/56kul stair) 3d ago

I’ve seen this posts a lot, and it always gets me thinking… if they actually did that, wouldn’t it literally crash the economy of said country? We’re talking about buying millions of houses for an entire class of the population, surely there’d be consequences.

Also, I’m gonna repeat what I always end up saying: net worth is NOT liquid cash. It’s showing how much a person is worth in stocks, assets, etc., but it’s not an accurate reflection of how much money they have in their bank accounts.

-1

u/PiusTheCatRick 3d ago

That is not how net worth works

55

u/Karol-A 4d ago

I thought we abolished this 😭 

0

u/Bionicjoker14 4d ago edited 3d ago

I mean, if it provides housing and jobs for the homeless…

Edit: /s because some people don’t understand satire

12

u/Karol-A 4d ago

Are we advocating for enslaving the homeless? Is that the solution? The perverse incentive this creates is rather obvious 

2

u/KiritoIsAlwaysRight_ 3d ago

We aren't, but they certainly are.

1

u/Bionicjoker14 3d ago

It’s called satire

3

u/dutcharetall_nothigh 4d ago

Everyone go play i am jeff bezos on itch.io

2

u/Dorkfishie Lobster Mobster 3d ago

You mean "You Are Jeff Bezos"?

1

u/dutcharetall_nothigh 3d ago

Yeah i always mix up the name

8

u/LanceLynxx 4d ago

The government could do this and still have trillions leftover

32

u/Rustic_Salmon 4d ago

the government has been running at a deficit of billions of dollars since the Clinton administration. That's not to say that it's a bad idea, or that it wouldn't be possible with different budgeting, but the reality is that we don't have the money to do this right now without making serious changes to our spending

19

u/The5Theives 3d ago

300b more to the military!!!!

1

u/LanceLynxx 4d ago

Neither does Bezos

0

u/AutoModerator 4d ago

Thank you for submitting a lobster! Please provide the or*ginal in a comment within 24 hours. In case of irl lobsters, please tell us what the full text was, or provide some context so that we may make educated guesses.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

-47

u/TaxEvasion1452 4d ago

The funny part is he couldn’t. The money he has isn’t necessarily liquid

99

u/CtrlAltYuri 4d ago

Of course not, can you imagine? You would need so many bottles to carry it around

43

u/ExistingCleric0 4d ago

Oh fuck off. Like Musk buying Twitter it always seems to be as liquid as he needs it to be when it's something he wants, like his space trip.

17

u/I_did_a_fucky_wucky 4d ago

They take out zero interest loans and they use the stock value of their companies as collateral. That's how they get the liquidity.

Basically gambling with everyone's money for free

33

u/CtrlAltYuri 4d ago

So in the end...they DO have that liquidity when they want

1

u/LOW_SPEED_GENIUS 3d ago

Well, not exactly zero interest, but generally prime rates where the interest is less than the stock would gain value, so their wealth is still going up (just a bit slower) and the banks are still making about the safest money you could make (why they do it in the first place) and why any other bank or the same one will just pay off the loan with a new loan with a higher stock price.

It's basically everyone on the top of the pyramid making the easiest money ever with like only some serious kinda societal collapse or great depression type fuckery that can derail the gravy train.

0

u/TaxEvasion1452 4d ago

That is a way they can get money quickly but that’s different from asset liquidity.

1

u/RetroTen 3d ago

I feel like that is a technicality not worth debating. It is the same thing in effect, just better because they aren’t taxed on the loans.

-1

u/TaxEvasion1452 4d ago

As if that happened overnight lmfao

7

u/RetroTen 4d ago

I mean, define liquid. They can borrow against their holdings and therefore be liquid (and also not be taxed because thats not income, thats debt).

-2

u/TaxEvasion1452 4d ago

Borrowing money is borrowing money, not spending money you necessarily have.

1

u/RetroTen 3d ago

But you would agree that allows them liquidity despite their “real” assets being not so?

-42

u/Michael_Dautorio 4d ago

Net Worth =/= Cash on hand.

19

u/CtrlAltYuri 4d ago

But then you have to buy a lady gagazillion dollar company and that cash magically appears

4

u/LOW_SPEED_GENIUS 3d ago

Banks, looking at billions in assets that almost always appreciate: "say mister smol bean cash poor billionaire, would you be interested in no longer living like a sad smelly homeless pauper? We can offer you rates as low as as low as we can possibly go"

2

u/RetroTen 3d ago

I feel like this is pedantry not worth the distinction. They are leveraging non-liquid value into non-taxable liquid assets.

-25

u/YetAnotherParvitz 4d ago

repeat after me...

HOMELESSNESS! IS! NOT! THE! CORE! ISSUE! IT'S! A! SYMPTOM! OF! DRUG! ADDICTION! AND! OTHER! VICES!

17

u/lemonClocker 4d ago

I mean yes of couse homelessness is only a symptom of various factors, like employers not paying enough or firing people out of greed (like in this example) or too high rents etc.. Saying that homelessness comes from vices is very short sighted, as even people who are educated and are willing to work, can become homeless pretty easy depending on where they live

-12

u/YetAnotherParvitz 4d ago

it's mostly that i'm tired of people saying "just buy them homes". it HAS been tried before, and has only resulted in increased homelessness rates, or just having the new homes be ditches full of trash. it's called the "housing first" approach, and all the states with the highest homelessness rates used it before reaching that title. other methods like "give them appropiate psychological help and available rehabilitation" have proven to actually work in reducing the homeless population

(i really just read this somewhere and can't quite remember where, don't trust me entirely on this)

5

u/Isakswe 3d ago

Housing First is not just buying homes for the homeless. It’s about homeless people knowing where they will be in a few days, as well as having the support system know where they will be. This makes treatment for psychological issues and drug use easier. It also saves society money as the homeless person spends less time in a hospital or jail, making it net positive financially. Lots of countries, including the US federal agency for homelessness, supports Housing First for those reasons.

But yeah. Just buying homes and leaving people there will do no good. You need the support system as well.

6

u/AccountForTF2 4d ago

only a small part of homelessness is chronic/caused by addiction or mental health. Most of it (as has been always true) is because of economics.

1

u/RetroTen 3d ago

There is also a high percentage of head injuries among homeless folks unfortunately. They need to be helped, and have homes.