Archive for October 6th, 2011

A couple of years late, Orzag jumps on the HomaFiles idea re: housing.

October 6, 2011

For a couple of years, I’ve been saying that private capital should be unleashed to stabilize the housing market.

How? Accelerated depreciation for residential  rental property with unabsorbed passive losses used to reduce ordinary income … and no capital gains on the property when sold – after a couple of years minimum holding period.

Well, well, well.

In a Bloomberg article “U.S. Can Rent Its Way Toward a Housing Recovery”,  Peter Orszag – Obama’s former budget guy – now proposes roughly the same idea.

Just a couple of years late.

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Posted in Housing - Mortgages | Leave a Comment »

The unpredictability of innovation …

October 6, 2011

According to innovation guru Clayton Christensen:

Statistically, 93% of all innovations that have ultimately become successful started off in the wrong direction

The probability that you’ll get it right the first time out of the gate is very low.

Excerpted from MIT Sloan Review: Good Days for Disruptors – An Interview with Clayton Christensen Spring 2009

Bottom line: stay flexible, don’t get wedded to a concept …. constantly look for repurposing of the product or its technology.

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The price of the “seniors’ buffet” is going up …

October 6, 2011

According to Business Week, Costco claims gets about 75% of its income from membership fees.

So, with income under pressure, the company is going to the well and jacking them up.

The WSJ reports:

Costco  said it is raising membership fees 10% for about 22 million customers, as the largest U.S. warehouse club operator seeks to offset rising costs.

The fee increase is the company’s first in more than five years.

Currently most members pay an annual fee of either $50 or $100 for executive members

What’s a “seniors’  buffet”, you ask?

Well, Costco is famous for having blue-haired women cooking up and passing out food samples.  So many, that legend says that some fixed income oldsters buy the membership just so they can come and graze on the samples.

I’m not into to that, but I am into Costco’s giant hot dog and 16 oz. drink for $1.50.

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