Zepp wades into Canyonland... and get's slapped around
Steve
<zepp22...@finestplanet.com> wrote:
>On 5 May 2007 06:36:28 -0700, milt....@gmail.com wrote:
>
>>So, who are we going to believe?
>>
>>Steven Canyon who, even after having been shown his ass several times
>>on margin accounts, continues to say the following:
>>
>>"<ROTFLMAO> Loans increase your liability, but also increase your
>>assets by the same amount producing a zero effect on your net worth."
>
>He really said that?
>
>I guess he's never heard of "interest". They charge that on loans.
>>
I guess Zepp's never heard of the terms,"present value" and "future
value."
"engineering economics," Zepp, google it.
milt....@gmail.com
> On Sat, 05 May 2007 15:10:38 GMT, 3369 Dead
>
> >On 5 May 2007 06:36:28 -0700,milt.sh...@gmail.com wrote:
>
> >>So, who are we going to believe?
>
> >>Steven Canyon who, even after having been shown his ass several times
> >>on margin accounts, continues to say the following:
>
> >>"<ROTFLMAO> Loans increase your liability, but also increase your
> >>assets by the same amount producing a zero effect on your net worth."
>
> >He really said that?
>
> >I guess he's never heard of "interest". They charge that on loans.
>
> I guess Zepp's never heard of the terms,"present value" and "future
> value."
>
> "engineering economics," Zepp, google it.
Canyon, no matter how stupid you get, you never cease to amaze me with
topping yourself.
The $10,000 you get on day 1 of the loan is worth considerably LESS
than $10,000 by the time the loan is 3 years old. Two factors are
interest and inflation. IOW, given a 5% inflation rate and 5%
interest, by the time the loan is three years old, that $10,000 has
magically become $7290. THAT is what "future value" means, you idiot.
IOW, the worth of the $10,000 that you borrowed has gone down to
$7290, while the $10,000 is still $10,000 to the bank.
If you don't believe me, check this out...
Congratulations!!! You have won a cash prize! You have two payment
options:
A. Receive $10,000 now
OR
B. Receive $10,000 in three years.
Okay, the above offer is hypothetical, but play along with me here ...
Which option would you choose?
What Is Time Value?
If you're like most people, you would choose to receive the $10,000
now. After all, three years is a long time to wait. Why would any
rational person defer payment into the future when he or she could
have the same amount of money now? For most of us, taking the money in
the present is just plain instinctive. So at the most basic level, the
time value of money demonstrates that, all things being equal, it is
better to have money now rather than later.
But why is this? A $100 bill has the same value as a $100 bill one
year from now, doesn't it? Actually, although the bill is the same,
you can do much more with the money if you have it now: over time you
can earn more interest on your money.
Back to our example: by receiving $10,000 today, you are poised to
increase the future value of your money by investing and gaining
interest over a period of time. For option B, you don't have time on
your side, and the payment received in three years would be your
future value. To illustrate, we have provided a timeline:
If you are choosing option A, your future value will be $10,000 plus
any interest acquired over the three years. The future value for
option B, on the other hand, would only be $10,000. But stay tuned to
find out how to calculate exactly how much more option A is worth,
compared to option B.
Future Value Basics
If you choose option A and invest the total amount at a simple annual
rate of 4.5%, the future value of your investment at the end of the
first year is $10,450, which of course is calculated by multiplying
the principal amount of $10,000 by the interest rate of 4.5% and then
adding the interest gained to the principal amount:
Future value of investment at end of first year:
= ($10,000 x 0.045) + $10,000
= $10,450
You can also calculate the total amount of a one-year investment with
a simple manipulation of the above equation:
* Original equation: ($10,000 x 0.045) + $10,000 = $10,450
* Manipulation: $10,000 x [(1 x 0.045) + 1] = $10,450
* Final equation: $10,000 x (0.045 + 1) = $10,450
The manipulated equation above is simply a removal of the like-
variable $10,000 (the principal amount) by dividing the entire
original equation by $10,000.
If the $10,450 left in your investment account at the end of the first
year is left untouched and you invested it at 4.5% for another year,
how much would you have? To calculate this, you would take the $10,450
and multiply it again by 1.045 (0.045 +1). At the end of two years,
you would have $10,920:
Future value of investment at end of second year:
= $10,450 x (1+0.045)
= $10,920.25
The above calculation, then, is equivalent to the following equation:
Future Value = $10,000 x (1+0.045) x (1+0.045)
Think back to math class in junior high (that's JUNIOR FRICKIN HIGH,
Canyon!!), where you learned the rule of exponents, which says that
the multiplication of like terms is equivalent to adding their
exponents. In the above equation, the two like terms are (1+0.045),
and the exponent on each is equal to 1. Therefore, the equation can be
represented as the following:
We can see that the exponent is equal to the number of years for which
the money is earning interest in an investment. So, the equation for
calculating the three-year future value of the investment would look
like this:
This calculation shows us that we don't need to calculate the future
value after the first year, then the second year, then the third year,
and so on. If you know how many years you would like to hold a present
amount of money in an investment, the future value of that amount is
calculated by the following equation:
Present Value Basics
If you received $10,000 today, the present value would of course be
$10,000 because present value is what your investment gives you now if
you were to spend it today. If $10,000 were to be received in a year,
the present value of the amount would not be $10,000 because you do
not have it in your hand now, in the present. To find the present
value of the $10,000 you will receive in the future, you need to
pretend that the $10,000 is the total future value of an amount that
you invested today. In other words, to find the present value of the
future $10,000, we need to find out how much we would have to invest
today in order to receive that $10,000 in the future.
To calculate present value, or the amount that we would have to invest
today, you must subtract the (hypothetical) accumulated interest from
the $10,000. To achieve this, we can discount the future payment
amount ($10,000) by the interest rate for the period. In essence, all
you are doing is rearranging the future value equation above so that
you may solve for P. The above future value equation can be rewritten
by replacing the P variable with present value (PV) and manipulated as
follows:
Let's walk backwards from the $10,000 offered in option B. Remember,
the $10,000 to be received in three years is really the same as the
future value of an investment. If today we were at the two-year mark,
we would discount the payment back one year. At the two-year mark, the
present value of the $10,000 to be received in one year is represented
as the following:
Present value of future payment of $10,000 at end of year two:
Note that if today we were at the one-year mark, the above $9,569.38
would be considered the future value of our investment one year from
now.
Continuing on, at the end of the first year we would be expecting to
receive the payment of $10,000 in two years. At an interest rate of
4.5%, the calculation for the present value of a $10,000 payment
expected in two years would be the following:
Present value of $10,000 in one year:
Of course, because of the rule of exponents, we don't have to
calculate the future value of the investment every year counting back
from the $10,000 investment at the third year. We could put the
equation more concisely and use the $10,000 as FV. So, here is how you
can calculate today's present value of the $10,000 expected from a
three-year investment earning 4.5%:
So the present value of a future payment of $10,000 is worth $8,762.97
today if interest rates are 4.5% per year. In other words, choosing
option B is like taking $8,762.97 now and then investing it for three
years. The equations above illustrate that option A is better not only
because it offers you money right now but because it offers you
$1,237.03 ($10,000 - $8,762.97) more in cash! Furthermore, if you
invest the $10,000 that you receive from option A, your choice gives
you a future value that is $1,411.66 ($11,411.66 - $10,000) greater
than the future value of option B.
-------------------------------
In other words, you silly sod, the notion that somehow your $10,000
stays $10,000 for years is patently absurd.
steven...@yahoo.com
> On May 5, 11:58 am, Steve <stevencan...@lefties.suk.net> wrote:
>
>
>
> > On Sat, 05 May 2007 15:10:38 GMT, 3369 Dead
>
> > <zepp22113...@finestplanet.com> wrote:
> > >On 5 May 2007 06:36:28 -0700,milt.sh...@gmail.com wrote:
>
> > >>So, who are we going to believe?
>
> > >>Steven Canyon who, even after having been shown his ass several times
> > >>on margin accounts, continues to say the following:
>
> > >>"<ROTFLMAO> Loans increase your liability, but also increase your
> > >>assets by the same amount producing a zero effect on your net worth."
>
> > >He really said that?
>
> > >I guess he's never heard of "interest". They charge that on loans.
>
> > I guess Zepp's never heard of the terms,"present value" and "future
> > value."
>
> > "engineering economics," Zepp, google it.
>
> Canyon, no matter how stupid you get, you never cease to amaze me with
> topping yourself.
>
> The $10,000 you get on day 1 of the loan is worth considerably LESS
> than $10,000 by the time the loan is 3 years old.
Yeah and that pretty much explains why you hsve to pay interest
Shrug Actually ,I said the exact opposite... another strawman.
This isfuny though... Milt writes a big lg essay to support what I
posted..
Thanks, Milt.
Matt
wrote:
> On May 5, 12:31 pm, milt.sh...@gmail.com wrote:
>
>
>
> > On May 5, 11:58 am, Steve <stevencan...@lefties.suk.net> wrote:
>
> > > On Sat, 05 May 2007 15:10:38 GMT, 3369 Dead
>
> > > <zepp22113...@finestplanet.com> wrote:
> > > >On 5 May 2007 06:36:28 -0700,milt.sh...@gmail.com wrote:
>
> > > >>So, who are we going to believe?
>
> > > >>Steven Canyon who, even after having been shown his ass several times
> > > >>on margin accounts, continues to say the following:
>
> > > >>"<ROTFLMAO> Loans increase your liability, but also increase your
> > > >>assets by the same amount producing a zero effect on your net worth."
>
> > > >He really said that?
>
> > > >I guess he's never heard of "interest". They charge that on loans.
>
> > > I guess Zepp's never heard of the terms,"present value" and "future
> > > value."
>
> > > "engineering economics," Zepp, google it.
>
> > Canyon, no matter how stupid you get, you never cease to amaze me with
> > topping yourself.
>
> > The $10,000 you get on day 1 of the loan is worth considerably LESS
> > than $10,000 by the time the loan is 3 years old.
>
> Yeah and that pretty much explains why you hsve to pay interest
It explains nothing of the sort.
Actually, you said nothing at all. You were wrong, twit, everyone
knows
it.
>
> This isfuny though... Milt writes a big lg essay to support what I
> posted..
Nobody can support your stupidity Canyon, you are just too idiotic to
realize it.
Removing you from Yahoo is fairly easy, getting rid of your other
account
for ToS violations isn't going to take much longer.
Matt
>
> Thanks, Milt.
steven...@yahoo.com
wrote:
the reason that Milt invents strawmen to attack is
because he can't even address what I say...
The value of money always deteriorates as you
move forward in time and paying intrest on your
loan is a way to compensate the lender for the
deterioration of his money as you use it...which
is why the interest you can't be considered a loss.
...and Milt ,the fool went off and copied a whold
lot of stuff somewhere to back that up, decalring
at the end that I'd claimed the exact opposite
I think Milt believes that his quite ignorant friends
can be fooled by that tactic..
...and yet Milt cannot support his claim that:
when you borrow money to buy stocks, and
you're hit with a margin call, you're out the
amount of that margin call, any way you look at
it
mongoose
> On Sat, 05 May 2007 15:10:38 GMT, 3369 Dead
>
> >On 5 May 2007 06:36:28 -0700, milt.sh...@gmail.com wrote:
>
> >>So, who are we going to believe?
>
> >>Steven Canyon who, even after having been shown his ass several times
> >>on margin accounts, continues to say the following:
>
> >>"<ROTFLMAO> Loans increase your liability, but also increase your
> >>assets by the same amount producing a zero effect on your net worth."
>
> >He really said that?
>
> >I guess he's never heard of "interest". They charge that on loans.
>
> I guess Zepp's never heard of the terms,"present value" and "future
> value."
And where is the future value supposed to come from in a political
environment that keeps financing its "canyonous" deficits with more
and more loans? And when our creditors decide to call in debt,
where's the future value *then*? Oh, that's right, you Republicans
have all the answers. The only problem is, all your answers turn out
to be unmitigated disasters.
> "engineering economics," Zepp, google it.
--
This Modern World: Mistakes were made!
http://www.workingforchange.com/comic.cfm?itemid=22132
David Hartung
> Removing you from Yahoo is fairly easy, getting rid of your other
> account
> for ToS violations isn't going to take much longer.
From here, it looks as if you are trying to silence someone for no other reason
than that they disagree with you.
Steve
The only thing Matt is trying to do is look like less a moron... It
isn't working... I'd kill file the fool if he wasn't so entertaining
Matt
No, I am doing nothing of the sort.
Matt
David Hartung
Then what do you call it?
Matt
I call it nothing. It was a simple statement. Your interpretation is
your own business. However, I recommend you look up what ToS
means.
David Hartung
The logical question is a simple one. Specifically what "term of service" has
Mr. Canyon violated?
Once again, you give the appearance of trying to silence someone with whom you
disagree.
Matt
Once again, you don't read too well. Not a huge surprise.
Why don't you go look up Yahoo's Terms Of Service and get back to
us with your report.
Matt
David Hartung
Why don't you answer a simple question?
Matt
I did. Your lack of understanding indicates a problem on your part,
and not mine.
Matt
David Hartung
Discussion ended. I asked you to state the specific term of service which Mr.
Canyon has violated, and you refused. This leads me to conclude that you are
making idle threats, or that you wish to silence those who disagree with you.
Steve
Matt isn't too bright...It doesn't take much to stump him
Matt
Really, David. I asked you to define the terms under which we would
leave
Iraq, and you refused.
You are a little twit that likes to pretend he is an adult, and I
really couldn't
care less about your opinion, if in fact you have one that hasn't been
fed
to you.
Buh-bye kiddo.
Matt
Matt
> On Sun, 06 May 2007 15:44:23 -0500, David Hartung
>
>
>
I corrected your typo for you.
Matt
David Hartung
David Hartung
I sort of figured that out.
David Hartung
Childish too.
Steve
I figure about fourth grade...
Matt
Son, when you grow up enough to have adults listen to you,
we will be happy to do so. Canyon will never reach that point.
I have my doubts about you. Hypocrites are usually stuck at
2nd grade.
Matt