We’re All Investors Now (2013)
lackingambition.com
lackingambition.com
From that point of view, a house is a speculative investment (there's a chance it will go up but also may not) while a car is definitely not an investment (short of very crazy things happening, value declines very quickly with time.)
So I agree with the author that saying something like "I invested in a bottle of booze because booze will make me happy" is an abuse of the term investment.
However, now that I am a bit grown up and have a wife and kids, I look at the concept of investment in a broader sense. To me investment is anything that will give me/my family something important and less nebulous than happiness but not as concrete as money.
For example, we just paid more for a house than we would have because it's walking distance to family. There may be some minor financial benefits to this but is not the point - we didn't do it to save gas money visiting them.
But I see it as an investment of a sort. I care about my kid, and I think it's good for him to grow up seeing his cousins every day. I know my wife is very happy to be near family. So while it's not a financial investment, I do see it as an investment into my child and family and that feels kinda like a real thing.
A colleague of mine bought a relatively new car back in 2019 and resold it for the same price a few months back.
So we are currently in the world where crazy happens.
But I think the point stands - your friend likely did not buy this car in 2019 planning to sell it for more so it's not an investment.
(on the other hand, if he had anticipated covid and the chip shortage and bought cars expecting to sell them for more, that would be an investment - but that's not what people are doing)
A lot of people became car flippers too, bought used cars, repaired them, improved what could be improved, and sold them back, if done right sometimes for amounts that were ludicrously much more than they paid.
Suffice to say, rampant inflation is NOT pretty.
It depends on the type of car, but certain, usually very expensive, cars still do gain in value over time. This is one of the ways the system starts working for you instead of against you once you are rich (if you are smart about it). When I found out about this, I started to see rich people having garages full of old timers in a different light: it's just a different way of investing money.
On the other hand, most people who buy cars to use as transport for X years and expect to either drive them into the ground or sell back at a fraction of value, aren't investing.
Even consoles can be an investment in this odd time, due to shortage I sold my Switch for 100 more than I bought it used. Video games can be flipped at almost no loss if done within the first 2 weeks etc.
If you replace "has a shot of" with "is expected to" then I agree with what you are saying. That being said, decisions aren't made in a vacuum and payoff not strictly tied to the underlying asset. So, a bike to deliver newspapers, a backhoe to dig for treasures, or a laptop with Adobe Creative Suite could all be considered investments.
Your last point is essentially the concept of utility. More abstractly, you are investing in your children by spending money now to raise them with good values in hopes that it brings them more utility later.
I do agree that if you're buying a car because you think it will be a collectible, or you will use it to drive Uber and make more money, it's an investment.
My point is that most people who buy cars do NOT buy then with a plan to make money off of them, but still casually refer to investing in an asset, which isn't appropriate.
And depending on locality, a car can get you to a better paying job (or a job period). So having the car brings you returns on your investment every paycheck. Well, the car + your time at the job + your time and expense in education that made you qualified for that job and pay level.
People don't usually say they will invest in something that will imminently be used up. It can be food, but only if you're going to hold onto it for a while, e.g. disaster prep. They do say things like "I decided to invest in a new suit." There is a rule here though I'm not sure what it is. Perhaps the etymology[1] is helpful (but also perhaps not and it's just misleading).
Anyway, this usage isn't necessarily rendered invalid because some domain has a more specific and contradictory definition, much as botanical fruits don't make tomatoes any less of a vegetable in the kitchen.
[1] https://www.etymonline.com/word/invest#etymonline_v_12190
> An investment is when a resource is expended in order to gain profitable returns, as interest, income, or appreciation in value. Being able to spend your free time over the next year playing video games is not a profit.
I'm paid for my time, and my unpaid time is incredibly valuable. Anything that increases the value of my paid time has an obvious investment gain, by the author's metric, but so does that for my unpaid time.
If a purchase that I make increases the value of that unpaid time, then doesn't that constitute some form of return? Certainly, I cannot _sell_ that value, but it has served as a multiplier of value that isn't normally fungible: my happiness.
> So their ROI is their happiness. So now anytime you spend money on absolutely anything it’s an investment. Which renders the word “investment” completely indistinguishable from the word “purchase”.
Er, no, not at all. There are _definitely_ purchases that I must make that do not appreciably increase my happiness. Some service other needs that do not directly increase or decrease my happiness, while other purchases are necessary but misery-making.
I could go grocery shopping, or I could use Instacart for about $8 or so (as long as you use a store with in-store pricing).
I could drive for 7 hours and spend 80 on gas or spend 200 on a plane ticket and for the most part use the time as I please.
Being able to quantify it in some manner gives me better perspective on whether or not the enjoyment I derive from those leisure activites are "worth it". It helps that a lot of my leisure activities are things like woodworking landscaping, carpentry, etc - so I always have the option of working instead and paying someone else to bring about the end result I'm seeking.
This experience really really sucks in the world of "blockchain", because often the lines get blurred and people feel like they are very very literally investing (in money, not just time or attention or interest or whatever) in products they are using: to use the product at all you often own some amount of a utility token... whose value will go up if more people like you use the product (maybe even faster enough that you make money on your holding faster than you spend it on your utility usage, which is ridiculous)... and so the incentives on forums and reviews get skewed in ways that mere paid placements could only dream about.
> If you’ve thought through a purchase and decided you want something then good for you. Go get it. But don’t lie to yourself by calling it an investment.
And so it arguably isn't lying anymore, and everyone is now weirdly incentivized to lie about how much they like using the product or trade around misinformation about how much better the product is than competing products, as it no longer is about helping other people find the best product--or even getting everyone onboard with a network effect on a platform which you've invested your time in (which definitely happens: you do "invest" in sites like YouTube, Facebook, Instagram, and TikTok, even as a pretty normal user)--but you actually kind of by definition of how it is set up often stand to make or lose money based on other peoples' perception :(.
That's because a person can consume food, entertainment, etc., but a corporation can't. It's strictly a entity that passes on profits to its owners.
You can write off a business dinner as an expense. Upper management also gets company cars, company phones, with company paid plans that they often use for private purposes as well.
Also first time I’ve heard hoi polloi since Thatcher era.
A common sales technique, at least since the 1980s, is to replace the word "cost" with "investment". So, instead of "the shower curtain costs $50", it's "for an investment of $50 you get a shower curtain".
However often people in other times were shown pictures of celebrity, never before have we been bombarded so much with "started from where you are, now I'm a founder/YouTuber/influencer/multi-level marketing maven" stories. And in that context, anything that "centers" you on being able to sustainably hustle is an investment in the hustle. The gaming you do to wind down at the end of the day, the fancy dinner or vacation that will motivate you to want more of that lifestyle - all of it is an "investment" in your own mental state, no different than a business investing in good lawyers or accountants that can help avoid distracting drama. And hey, if you're in a position to actually turn that energy into concrete results, that's perfectly logical!
But it's not for everybody, and I do agree with the OP that companies are taking advantage of the positioning to encourage people to go into more and more debt. The influencer economy is certainly not a zero-sum game and there's certainly not a hard cap on how it can grow, but looking society-wide I worry that expectations are so far misaligned that things are going to come to a head.
There are literally multiple definitions of “invest” in any dictionary. This essay is annoying.
Not all returns pay out in cash. To think otherwise is to financialize your whole life, to know the value of money but nothing else.
Investment doesn't imply positive returns. A squirrel hiding nuts in a cache to survive the winter is investing instead of consuming, even though some of these nuts will spoil or be stolen making the returns negative.
Note that GDP equals consumption + investment (sometimes the government and export/import components are broken down in the equation).
You can buy to consume today at a lower price than you likely will in the near future, assuming serious inflation on everything. So consuming today might be a good investment since you end up with a lower cost today for a product that you will buy soon anyway, the real return will depend on the realized inflation, which in some countries is not negligible.
A house is a deteriorating pile of lumber that requires periodic maintenance and also incurs a lot of taxes.
Anything else called an investment, or when I'm told what I deserve... is a big red flag.
As if we can't raise simply raise welfare because preventing homelessness and starving children is the decent thing to do - it has to be justified as some kind of business case.
For some things the word does make sense though. Exercise bike etc. Or tech where you learn something