Principium Volume II, Book 8, Quote 838, 840, 842

838. (6-17-2010) The stock that is laid out in a house, if it is to be the dwelling-house of the proprietor, ceases from that moment to serve in the function of a capital, or to afford any revenue to its owner. A dwelling-house, as such, contributes nothing to the revenue of its inhabitant; and though it is, no doubt, extremely useful to him, it is as his clothes and household furniture are useful to him, which, however, makes a part of his expense, and not of his revenue.

- Adam Smith – The Wealth of Nations, 1776

(These words ring familiar, as in the saying of Robert Kiyosaki that your house is not an asset, it is a liability. The populace is being fed this line about a house being an asset because they can write off the interest payments against total income thereby decreasing a person’s taxable income. However, the government has already received all of the money from very typical automatic payroll deduction, one is merely trying to get it back. Not to mention that the government always bills the owner for “property” tax on the same dwelling, thus never allowing you total freedom.)ATJ

840. (6-29-2010) Thus the farmer annually replaces to the manufacturer the provisions which he had consumed and the materials which he had wrought up the year before; and the manufacturer replaces to the farmer the finished work which he had wasted and worn out in the same time. This is the real exchange that is made that is annually made between those two orders of people, though it seldom happens that the rude produce of the one and the manufactured produce of the other, are directly bartered for one another; because it seldom happens that the farmer sells his corn and his cattle, his flax and his wool, to the very same person of whom he chooses to purchase the clothes, furniture, and instruments of trade which he wants. He sells, therefore, his rude produce for money, with which he can purchase, whatever it is to be had, the manufactured produce he has occasion for.

- Adam Smith – The Wealth of Nations, 1776

842. (6-29-2010) The gross rent of a private estate comprehends what-ever is paid by the farmer [or renter]; the net rent, what remains free the landlord, after deducting the expense of management, of repairs, and all other necessary charges; or what, without hurting his estate, he can afford to place in his stock reserved for immediate consumption, or to spend upon his table, equipage, the ornaments of his house and furniture, his private enjoyments and amusements. His real wealth is in proportion, not to his gross, but to his net rent.

- Adam Smith – The Wealth of Nations, 1776

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