Waltzing Matilda

I pointed out almost three weeks ago that Australia was moving to shut down its most profitable industry, mining, by imposing a 40% “super tax” on earnings. The response of the industry was entirely predictable: Rio Tinto and others announced that they were deferring expansion plans, which will lead to less, not more tax revenue.

Here in the US we will learn nothing from this exercise, but we should.


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2 responses to “Waltzing Matilda

  1. Edgewater Republican

    I think it’s very easy to vilify but think about it for a moment. If you were at the wrong side of the curve – you waited for so long for prices to stabilize or drop, post the dot-com bubble (since say 2001) – and while things didn’t make sense from a valuation perspective, getting a home in fairfield county was getting away from you and it continued to rise(10% per year off a high base)….you might have bought in 06/07 and have gotten caught. You were told it was dumb not to buy such a solid investment (CF you suggested this if you remember) and let’s say you did and you lost your job.

    The truly successful people in life realize that there is [a limited amount] of luck and timing in everything and while there was a lot of recklessness in the market, there were still a number of good people who got caught on the wrong side of the curve.

    In the end we will all persevere as we have gone through much worse times (Great depression, WWII), it’s just sad to see so many families affected by this downturn….

    • Edgewater, I’m as guilty as the next person. My Grandmother paid $17,000 for a house in Riverside in 1957 that was probably worth $1.750 in 2006 and, while I obviously knew that couldn’t continue at a 20% increase each year (and said so) I thought we’d see a flattening, not a 30% drop in value. I was wrong. However, I do believe, long term, Greenwich is the best place to buy a house in the whole country – there’s limited land, great beauty, safety, good schools, wonderful, educated people and proximity to Manhattan.
      But Pal Nancy and I, thanks to Granny’s foresight, were able to keep the mortgage low and paid off student loan/home equity loans regularly. That was good fortune – someone who bought and paid fuil market value in, say, 2005, then lost his job in 2009? He or she has my complete sympathy and understanding. As I noted, showing these houses just sucks.