We had a very special guest on the Opening Belle podcast today...
Dominic Frisby is described as a British author, comedian and voice actor on Wikipedia.
But that just doesn't tell the full story.
He's the author of books such as:
- Life After The State (why we don't need government)
- Bitcoin - The Future Of Money?
- Daylight Robbery - How Tax Shaped Our Past And Will Change Our Future
We had a really enjoyable conversation covering Georgism, simpler taxes, the wealth effects of QE, and who the most disadvantaged in society really are...
Listen to the full show here 👇
🔥 Hot or 🚫 not?
Yields are on 🔥 after Powell (re) confirmed yesterday that the Federal Reserve are a long way from tapering...
The 10Y hit 1.43 this morning...
Maybe THEN we can buy TLT?
🚫 ARK Innovation ETF
Since its launch in October 2014, ARK Innovation, the firm’s largest fund, has delivered an average return of 39% annually
ARKK is down just over 10% so far this week,with speculation that concentration risks and the increased size of the funds will make this outperformance impossible to replicate...
She's very positive on Bitcoin and definitely (probably) bought the dip...
If you're trading crypto already, see if you can eek out a little more profit by trading with Equos.
They're running a 'Race For Crypto' promo
🏡 Georgism fixes everything
Inequality is not a new phenomenon - it's been around for a LONG time.
But can it ever be fixed?
In the 1870's Henry George wondered why the increasing wealth of a country always seemed to be accompanied by an increase in poverty.
Sounds familiar, right?
Well, good old Henry offered a solution...
A land value tax (to replace all other forms of tax)
The tax upon land values is, therefore, the most just and equal of all taxes. It falls only upon those who receive from society a peculiar and valuable benefit, and upon them in proportion to the benefit they receive.
Put another way, LVT discourages rent-seeking behaviour.
Winston Churchill was a fan - He was convinced that “land differs from all other sorts of property” and offers a fabulous example of 'unearned betterment':
A parish church started to give out free food to poor people living in a particular area.
Demand to live in the area rises.
The main beneficiaries of this surge in community spending? Local landowners.
Their rents and hence the value of their land rise in response to the free bread.
And the effect on the poor?
Entirely neutral: they paid less for their food but more for their shelter.
How about Mcdonald's and their famous golden arches... Don't they make all of their money selling McBurgers?
McDonald's makes more money in real estate than from hamburgers
Back in 1956, McDonald's employee Sonneborn saw the writing on the wall; fast food didn’t make enough profit to sustain their expansion plans.
Something had to be done. Investors were sought, and banks were tapped, but neither Kroc nor Sonneborn found anything landing in their favor.
Then Sonneborn figured it out; McDonald's would lease the whole site for each restaurant (including the land) from a land owner, rather than purchasing the parcel outright.
Then McDonald's would sublease it back to the franchisee, who would manage the restaurant.
McDonald's would eventually prove a consistent revenue stream and acquire a mortgage to purchase both the land and the building.
This strategy allowed Kroc to buy out the McDonald brothers in 1961 for $2.7 million, enough to pay each brother $1 million after taxes.
60 years later, McDonald's have a real estate portfolio of ~$35 billion, and a market cap of $157 billion...
The business model?
The only reason we sell 15 cent hamburgers is because they are the greatest provider of revenue from which our tenants can pay us rent - Harry Sonneborn
For more on Georgism, get a free copy of the original Progress & Poverty here
💸 Why QE is a tax on the poor
We've all seen the memes... Money printer go brrrr LOL
But all of this money being printed is making you poorer (unless you own assets)...
We covered this in the podcast and David's superb thread (from 2019) still holds...
🛒 Utrust does it again
The crypto eCommerce fintech has pulled out a wondermove here.
Absolutely the best 'bridge' from the traditional payments world to the new digital economy.
If you receive payments and want to tap into the crypto crowd, then I thoroughly suggest that you connect them to your site...
💄 Beauty beats education
The economics of beauty are undeniable when you stop and think about it...
Dominic mentioned Daniel Hamermesh and his research so I did some digging and found this gem.
Citing Hamermesh's work (and his book, 'Beauty Pays'), this article is excellent:
What happens if you’re not attractive in this new world? In a chapter titled “Legal Protection for the Ugly”, Hamermesh argues there could be a case for some kind of affirmative action – after all, unattractive people, like those from racial minorities, are being denied opportunities.
“Bad looks,” writes Hamermesh, “can generate an earnings disadvantage of perhaps $140,000 over a lifetime compared to the earnings of an average-looking worker.” And the ways in which an unattractive person is disadvantaged are similar to the ways others – black people, say – are disadvantaged.
He goes on: “The causes of mistreatment of the bad-looking, and their results – inferior outcomes in a large variety of areas – seem little different either qualitatively or quantitatively from the mistreatment of other groups.”
The ugly could demonstrate. They could sue. But will it ever happen? Can you imagine people wearing “Ugly Power” T-shirts? Would you? No, me neither.
Maybe I'll try growing that beard after all...
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