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78 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

That would be really, really bad. Any house that loses value will be unsellable, and thus virtually worthless. Most people living in such a house would be prevented from moving. They cannot sell it, ...
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29 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

And everyone is safe, the crash prevented and everyone will keep making millions simply by borrowing more for risk free "investing" in simply owning ones own house, right? It is true, your investment ...
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  • 401
23 votes
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Why is bartering uncommon in modern countries?

The main likely reasons why barter is not more common are: The inconvenience of having to find another party who both offers what you want and wants what you offer. Even if such a party can be ...
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  • 6,718
17 votes

Why is bartering uncommon in modern countries?

In the countries that I am familiar with (such as Canada), using barter to avoid taxes is definitely illegal. You are required to report the dollar value of the exchange as revenue. It is treated as ...
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12 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

Mandating a house be sold at last price sold does not mean that people value it at that sticker price. I could mandate that water bottles only be bought for $1,000,000. This does not mean anyone would ...
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  • 97
11 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

If the housing bubble would burst in Scandinavia as it has done in many other places the recent decade, certainly all banks will immediately be wiped out and millions of Scandinavians will become ...
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  • 368
7 votes

What are taxes for since law forbids printing of money?

"Why I don't hear nobody speaking about such idea?" Because historical experience says it won't work. By printing money instead of collecting taxes, what increases is the nominal disposable income....
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7 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

Bursting bubbles don't destroy actual wealth. Instead, they stop destructive processes which convert actual wealth into imaginary wealth. Suppose it would cost \$120,000 to build a house that's ...
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  • 255
6 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

There will be a rapid rise in artificial schemes to get round the letter of the law. For example, an agent may charge you 90% of the minimum legal sale price to officially register your house as ...
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  • 451
6 votes
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Example of Law of One Price holds but No Arbitrage Fails

Examples where this happens are always extreme and contrived. I can think of two kinds of examples. The first is where you have an asset that for some reason has a price of zero or negative but a ...
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  • 9,107
5 votes

What are taxes for since law forbids printing of money?

The current answers correctly point out that financing the government via the printing press would generate inflation. Since inflation is bad, this would be a bad policy. However, these answers miss ...
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4 votes

Why is bartering uncommon in modern countries?

The same reason why money became popular in the first place: bartering doesn't scale well. Even if you're able to evade taxes by bartering, the inconvenience makes it difficult to take advantage of ...
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  • 139
4 votes
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2010 flash crash: cause and rationale for illegality

What exactly is it that the trader is alleged to have done, how did this allow him to make irregular profits, and what is the mechanism by which he was able to single-handedly move the entire equities ...
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  • 244
4 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

This would be a catastrophically bad idea. The next time the economy turns down, what happens? Workers who own houses for which they cannot find a buyer at the same price they paid for the house, ...
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  • 151
4 votes

Is the concept of limited liability in corporate law beneficial to economy

It is beneficial (at least, mostly beneficial). Investments are risky, and business projects fail all the time at no fault of the entrepreneur. By bounding the risk profile of corporations, you give ...
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  • 4,138
3 votes

A law against selling any house cheaper than it was bought for, what consequences would that have?

Price is the thing that balances supply and demand, if you fix prices artificially low then you create supply shortages. If you fix them artificially high you create demand shortages. So people who ...
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3 votes
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Understanding at a quote about externalities in law and economics

You don't give the source of the quote, but presumably what is meant is this. Whether X's production or consumption of a good affects Y (in a physical way such as smoke from X's factory or noise from ...
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  • 6,718
3 votes
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How are shell companies used for tax evasion?

Another key feature of those shell companies is that they hide the ultimate beneficiary of the transactions. Banks, insurance companies and most financial services firm must make enquiries as part of ...
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  • 1,067
3 votes
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What makes a shareholder a "shareholder of record"?

I typed "shareholders of record" into Google, and I got Stockholder of Record Also known as shareholder of record, record holder or owner, or registered holder, or owner. The stockholder ...
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  • 26.1k
2 votes

How are shell companies used for tax evasion?

A shell is simply an inactive company - there is a market for shell companies because it allows ordinary persons to buy a ready to go business - for example public traded shells with a stockmarket ...
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  • 192
2 votes
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Argentine default: "Rights upon future offers"

This is a good question! It turns out that exactly as you predict, if you get the transcripts or recordings from the meetings with judge Griesa in NY, some of the representatives of the non-holdouts ...
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  • 2,590
2 votes

What are taxes for since law forbids printing of money?

You can't create something from nothing. When the government prints money, that's really just colored paper. Printed money, in case production has not increased, will make money lose value. When the ...
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  • 5,404
2 votes

What is banking compliance

You are using it correctly. It means the processes and protocols created by banks or those imposed to them by authorities. If the bank also has some quality certificate, like iSOs, them this imposes ...
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2 votes

How bad is piracy hurting the entertainment industrie's economy? Are they going bankrupt or have a good outlook?

Economic evidence on the effects of piracy is mixed. Most of the evidence focuses on the music industry, where piracy has been especially prevalent and where data is often more readily available. ...
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  • 16.6k
2 votes

Why is bartering uncommon in modern countries?

It doesn't save money. Keep in mind that revenue taxes are calculated after deduction of expenses. So if I sell something for 50€, and buy something for 50€, the total earnings of my company have not ...
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2 votes

Trying to track down the earliest usage of rivalry, tangibility, excludability, and durability in economics

You can try Google Books Ngram Viewer. On the bottom of the graph, there is a Search in Google Books giving access to the references.
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  • 6,652
2 votes
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Does cornering a market has any "bad" economic consequence?

You already have your answer in the last sentence. A monopoly can be established and that leads to well known "bad" economic consequences, i.e. economic inefficiencies.
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  • 5,404
2 votes
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Have the deregulation measures that caused the 2007-2008 crisis been rolled back?

Actually, in the literature Great Recession itself is not attributed primarily to financial deregulation. Financial deregulation played a significant and extremely  important role in the Great ...
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