Hi Mish -
(this may piss you off - but I gotta
go there ...)
What does the word LOSS mean?
Example 1:
I purchase a house for $50,000 and think I can
get $100,000 today.
You offer me $150,000.
Your friend offers me $175,000.
My wife tells me not to sell for whatever reason.
Have I LOST $50,000 or $75,000 and is this the loss
that Shiller is referring to?
-or- no effect.
Example 2:
I purchase a house for $50,000 and think I can
get $100,000 today.
I sell and only get $75,000.
Have I LOST $25,000 and is this the LOSS that
Shiller is referring to?
-or- no effect.
Example 3:
I purchase a $550,000 house with a $450,000 mortgage.
Me and my wife get fired.
I MUST sell my house and sell for $350,000.
What is my LOSS and is this the LOSS that Shiller
is referring to?
-or- no effect.
Example 4:
LOSS has nothing to do with buying and selling.
And is comparable to Inventory valuation?
i.e.
At one point in time the value of inventory is worth
XYZ.
At another point in time - the same inventory in
terms of units - is valued much lower for whatever
reason.
Is this the LOSS that Shiller is referring to?
regards,
John |
