President Potato is Wrong

President Biden made a speech on gun control in New York. He said that

When the [Second] Amendment was passed, it didn’t say that anyone could own any kind of gun and any kind of weapon. You couldn’t buy a cannon when this Amendment was passed, so there’s no reason why you should be able to buy certain assault weapons.

President Joe Biden on gun control

The Amendment didn’t say that, for two reasons: First, the Amendments to the Constitution don’t say that people can do anything. The Amendments say that the GOVERNMENT can’t do things. The government can’t infringe on the right keep to bear arms, is what it says. Second, people DID own cannons. Privately organized and funded artillery companies in the colonies date all the way back to the 1630s. A century later, in the 1740s, there are records of Benjamin Franklin helping organize artillery companies while stressing that they were made completely of volunteers and armed at their own expense.

One of the driving forces behind the first major battles of the Revolutionary was because the British soldiers were coming to confiscate privately-owned arms – including cannons and mortars – such as ones that were being held by veterans of the French and Indian War as war trophies.

In fact, there were people who owned entire warships. See my post on this from 2013.

During the course of the Revolution, approximately 1,700 letters of Marque were issued to privateers. In the War of 1812, President James Madison issued more than 500 letters of Marque to privateers. These letters of marque created what was, essentially, legal piracy, and it was sanctioned by the government and even deemed necessary. So how did these privateers arm their vessels? With cannons that they purchased as individuals.

Our colonial navy had approximately 1,200 cannons on board less than 65 ships. The privateers, on the other hand, had almost 15,000 cannons – all privately owned.

The National Firearms Act of 1934, which is, by far, the most restrictive piece of Federal legislation related to the ownership of arms, says nothing about cannons. It wasn’t until 1968 that things we regard as modern artillery were regulated further when ‘destructive devices’ were added to the law.

But muzzleloading cannons, like the ones used during the Revolutionary War remain conspicuously absent in any legislation. You could buy a cannon as an individual in the Revolution era, and you can still buy one today as an individual.

The President then went on to say that the DOJ will be issuing restrictions on guns made at home within the next few weeks, what he calls a “National ghost gun enforcement initiative.” He also took a shot at the “assault weapon” boogieman.

You know, futures cut short by a man with a stolen Glock with 40 rounds. A magazine with 40 rounds. And it’s really a weapon of war. One of the things I was proudest of years ago when I was in the Senate, I was able to get these weapons and the size of magazines outlawed, that got changed, got overruled, but I don’t see any rationale why there should be such a weapon able to be purchased. It doesn’t violate anybody’s Second Amendment rights to deny that.

President Joe Biden on the ’94 Assault Weapons Ban

The law didn’t get overruled. It expired. Because the law had a ten year expiration date built into it.

The President is also claiming that outlawing weapons doesn’t violate your right to own them. Since when?

Policing for Profit

After my post from a couple of days ago, it has become apparent that some people think that speed cameras are a good idea, saying that they don’t speed, and are tired of people who do. It’s cute that those people think that speed cameras have anything to do with traffic safety or actual speeding.

In Baltimore, a speed camera issued a speeding ticket to a stationary car. The real story here isn’t that one car was erroneously ticketed. No, the real story is the fact that Baltimore’s 164 cameras have issued $48 million in tickets over the last three years. If the amount of the ticket, $40, is typical, this means that 400,000 tickets a year are issued by those 164 cameras: roughly 2400 tickets for each camera. The officers that review the pictures before a ticket is issued review and issue 1200 tickets per day. On an 8 hour workday, that leaves just 24 seconds for each picture to be reviewed and a citation issued. In other words, this is nothing but a revenue generator with few safeguards or oversight.

Officials in Heath, Ohio installed 2 speed cameras to watch for excessive speed on Route 79, an area that had seen only one crash in the previous two years. Those two cameras alone accounted for 5,000 traffic citations in just 4 weeks.

Since it was such a money maker, ten more cameras were installed to watch intersections in town and look for red light runners. Those ten cameras were responsible for 5,000 more tickets their first month. At those intersections, light runners had been responsible for only 16 traffic accidents over the previous two years.

In all, the traffic tickets will cost the drivers in the area more than $12,000,000 in fines each year, of which the city will keep $10,00,000.

Then there was the Long Island traffic cameras that were responsible for $2.4 million in School Zone speeding tickets during the summer, when there was no school in session.

The big winner here is actually the private company that installs and runs the cameras. They frequently are involved in kickback schemes.

Miami, Washington, DC, and half a dozen other cities have been involved in this fleecing of the public. No oversight, with a private company running the camera while giving some of the take back to the city.

Store of Value versus Investment

There is quite the discussion in comments over at Peter’s place about the role of gold versus investments. It appears as though at least one user doesn’t understand that precious metals are a store of value, but not an investment.

What the Federal government has done (and is doing) with our fortune is a disgrace, but governments have done that since, well, ever. Nothing new. Inflation isn’t an increase in prices. Inflation is a currency becoming worth less. Sometimes a currency is tied to a physical asset like gold, silver, or salt. Sometimes it isn’t. To say that gold is money and dollars are currency makes you sound like an idiot.

If currency is not tied to a physical asset, then its worth is not set in stone, pun intended. Because it does not in and of itself have value, currency will inevitably and eventually become worth less. That is called inflation.

To protect yourself from inflation, you are better off holding something that has intrinsic value. That can be food, oil, livestock, or precious metals. Over the long term, precious metals are a great way to own an asset with intrinsic value. This is because food spoils, livestock dies (and needs to be fed), oil is bulky and difficult to store. Even non-precious metals are difficult to store. An quantity of gold takes up far less room than an amount of lead of similar value.

Because they have intrinsic value, assets like precious metals don’t increase OR decrease in value. They just are. In 1920, an ounce of gold could buy a nice Colt handgun. The same holds true today. The problem is that your asset (the gold) won’t appreciate in value. It is therefore a nonperforming asset, and not an investment.

An investment is an asset that will not just hold its value, it will increase in value. Things like real estate, stocks, bonds, and the like will change in value. Sometimes for the better, sometimes not. If I had bought a new Ford Mustang in 1964, I would be doing far better than if I had bought a 1964 Ford Anglia. Picking winners and losers is how fortunes are made and lost.

Even though it can seem like it, the stock market is not the same as a casino. As both an investor and a gambler, I will tell you that they are fundamentally different. Where the ball lands on the Roulette wheel is a random event, that is, the ball is just as likely to land on the ‘4’ as it is on the ’30’.

Not so in the stock market. Companies are managed by people. Management teams. Some are good at what they do, some are not. Companies that are well run tend to do well. Companies that are poorly run tend to not do well. But how to tell the difference? The same way that you judge people. Look at how they have performed in the past.

The problem here is that random events can ruin even the best companies. A big fire in a key factory. An executive gets caught embezzling. A government contract is awarded to a competitor. The best defense to this is to diversify. Own shares in many companies across many segments of the economy. That way, if one company fails, the rest can carry you through.

That is why I am a huge fan of index funds. I buy shares in managed funds that are filled with large companies. The S&P500 is the 500 largest companies in the nation. They are large because they are successful. Even though there are bad days and good days, the good days outnumber the bad. That is why the S&P500 tends to increase.

You don’t have to know about business or stocks or get involved in the day to day workings of the market. Buy into an index fund and let the money compound. There are many to choose from. You can get a fund that buys shares of S&P500 companies. You can get a fund that buys companies that pay dividends.

Once you are comfortable with index funds and want to pick a couple of individual stocks to experiment with, do it. Just be careful. Don’t put all of your eggs in one basket. Just a small purchase at first. Leave most of your invested money in those index funds, and just buy a few shares of the individual stock you want to play with.

In March of 2020, I saw the price of cruise line stock nosedive. I figured that it was an opportunity. I started by buying $5K worth of Royal Caribbean in March. By May, we wound up buying about $50K worth of Royal Caribbean at an average price of $30 a share. I began selling it off in December of 2020, at an average of $90 a share. I tripled my money in less than 6 months. During the same time period, gold went from $1500 to $1800 an ounce- a 20% increase.

That doesn’t mean that you avoid gold. Remember, diversify. Gold should be PART of your savings, not ALL of your savings. Entire books are written on this. If gold were the answer, then billionaires would all have a vault filled with coins that they swim in like Scrooge McDuck. They don’t. You shouldn’t, either.

Wow Mark, That’s Gotta Sting

The bottom fell out of Facebook’s stock price this morning, down 24% for the day, and 38% from its 52 week high. In fact, its current price of 241.33 is the lowest it has been since July 2020. Wow Mark, that’s gotta sting.

Meta missed on earnings, saw Facebook’s daily active users dip for the first time ever as a public company (DAUs down by 1 million) and cited headwinds from inflation, foreign exchange, and an app tracking transparency feature Apple.

Remember when Facebook knocked MySpace out as the new Social Media hotness? Now TikTok is doing the same to Facebook. Social media is driven by teenagers and their fads. They come and go. TikTok has a shelf life, too.

Zuckerberg made the mistake of thinking his money train would last forever. I hope this is the beginning of the end for that asshole and his political money machine.

10mm, Bears, Ammo Shortage, Shopping

A couple of weeks ago, I asked “What caliber for bear?” A few of you mentioned the 10mm.

It turns out (via Commander Zero) that handguns are effective on bears 97% of the time. Who knew? Like me, he leans to the .44, but there is no getting around the 10mm and its higher capacity.

There is also Peter’s post over at Bayou Renaissance Man about the 10mm coming back as a defensive round.

I own defensive handguns in .38Spl, .380ACP, .357 Magnum, .357Sig, .40S&W, .45ACP, and 9x19mm. They require magazines, speed loaders, and a stock of ammo that has to be maintained and occasionally fired. Adding another caliber to the mix will require a lot of shopping and a fair amount of money. Then again…

You guys suck. Now I am starting to think about branching into a new caliber in the middle of this crazy ammo shortage. I may have to take a trip to the LGS to see what 10mm offerings are there…

Don’t Mention It

When I saw the article about the California firefighter shot and killed while fighting a dumpster fire, this jumped out at me as odd:

Stockton police said a 67-year-old man had been detained and a weapon recovered.

No description, no name of a suspect, nothing. When you see that, it usually means…

Yep. That’s what I thought. It seems that whenever the press dodges making a description, it usually is for a reason.

This post is not a comment on the shooting itself, as there are too few details available on what happened to draw any conclusions. Instead, this post is intended to point out that the press always seems to cover up stories that involve certain demographics.

Inflation and housing

Prarie1 commented on my post about housing and rent. He said:

Who would pay that much in rent??? That’s almost double my mortgage for 10 acres with a house and shop.

The explanation? Inflation, the eviction moratorium, investors, and escape from New York. All four of these things are driving an incredible increase in housing prices: both sales and rentals.

  • First, inflation. The dollar is simply worth less because you had the government shoveling cash into the economy with a metaphorical front end loader. More cash chasing the available housing means your housing dollar doesn’t go as far.
  • Next, the eviction moratorium. Being a landlord now carries significantly more risk than it did before the year and a half that landlords were forced to allow tenants to live in rental properties for free. Many landlords dropped out of the business. The ones who stayed began to raise rents in order to recoup losses caused by the moratorium.
  • Then there is the escape from New York (and other restrictive states). After being locked down for months, many people from more restrictive, northern states have figured out that, since they can work remotely, Florida is a great place to buy a second (or even third) home. Taxes are low, housing is relatively cheap, so they are buying up property like you wouldn’t believe. This has the effect of reducing supply, and driving up prices, mostly because they are paying too much for houses without even realizing it, because they still think it’s a bargain when compared to NY prices.
  • Then there are the investors. These are large companies who are watching the prices of real estate skyrocket and are buying up entire neighborhoods.

All of these factors are driving prices up to unbelievable levels. I was shocked in October when I did a review of area rental rates so I could adjust my rates for 2022. The average rental price had increased from about $1600 per month to around $2500 per month in just a year’s time. That’s a 56% increase in just a year’s time.

This nurse here in Miami saw a 40% increase in rent in one year’s time, and Miami’s rents were already high, meaning that they didn’t increase as much as some other areas in the state, such as Tampa or Orlando. Here are the cities with the largest growth in rent in the past 12 months, according to ApartmentsList:

  1. New York City, N.Y. – 33.5% rent growth
  2. Tampa, Fla. – 31.4% rent growth
  3. Scottsdale, Ariz. – 31.1% rent growth
  4. Orlando, Fla. – 30.1% rent growth
  5. Mesa, Ariz. – 29.5% rent growth
  6. St. Petersburg, Fla. – 29.3% rent growth
  7. Irvine, Calif. – 28% rent growth
  8. Phoenix, Ariz. – 27.9% rent growth
  9. Glendale, Ariz. – 27.5% rent growth
  10. Las Vegas, Nev. – 27.4% rent growth

If rents continue to increase at a rate of 32 percent per year, you can expect rents to double roughly every two years. (a $1,000 rent becomes $1,320 in one year, then becomes $1,745 at the end of year two) This is exactly what is happening.

Buying a house was similar. There are houses in the area that sold for $235,000 in 2019 and just sold again in 2021 for $325,000. The price of the house increased by 38 percent in less than two years.

So if a rent seems unreasonable, that’s because our real estate market is being warped and stretched by government interference. That is having the effect of driving up prices. So what do governments do? Interfere in the market some more, that’s what. Look at what the UK is doing:

Private landlords in the UK will be forced by law to bring their properties up to a set of national standards. Landlords will need a license. If a property fails to meet standards for maintenance, energy efficiency, and a minimum standard for fixtures and fittings, the landlord loses his license. Nearly one in five families in the UK are renters. What do you think this will do to rental prices in the UK when landlords are forced to lay out a large amount of money to meet the new, more stringent standards?

Expect to see a push for this here in the US.