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Dan Andrews |
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rusty nails
Champion Joined: 20 Mar 2013 Location: Sydney Status: Offline Points: 11301 |
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No dummy.
Not even close to being analogous. What’s the saying? I can explain it to you, but I can’t understand it for you…..
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Yeah, yeah....you can tell me in theory that the money already spent / invested at any point in time bears no influence on further spending / investing at that point in time based on changing outcomes.
But it does Are you seriously telling me in E&E's footy example that if you had already paid say $100 for a few non-refundable footy tickets vs going to buy at the gates that it would not influence a late change of mind if it started to rain ? If you say it wouldn't you are fibbing
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rusty nails
Champion Joined: 20 Mar 2013 Location: Sydney Status: Offline Points: 11301 |
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Done it many times.
I bought SOO tickets for me and 2 of my kids, it poured for days, and it was certain we’d get soaked, no matter what rain gear we had. Had to buy them SOO jumpers to make up for the disappointment for them missing out. Another time I took them all skiing for the weekend, would have been a $4-5k weekend. 2 hours on the first day, we were all soaked from rain, returned the hire skis and drove to Canberra and spent rest of the weekend there. Got hundreds of situations like that. |
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Of course you have - we all have pulled out of things we have paid for for any number of reasons
That wasn't the question though. Are you seriously saying that if you had already paid to do buy something of do something that wouldn't come into come into the decision making process of you not finalising a balance payment or attending an activity ? If you say "no" you must have too much money Rusty. Either that or your different to most normal folk
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Jesus my dementia is kicking in early today - that post reads terrible
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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I get the "sunken cost" thingo - its an economic truism
However, the reality is most decisions in life do not run according to it.
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Rusty would you like me too set up a poll thread & give a few examples to see how others feel ?
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ExceedAndExcel
Champion Joined: 20 Dec 2008 Status: Offline Points: 16226 |
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The reality is that in a financial decision process, if you are including money that is spent regardless of which way you go then you have no idea what you are doing.
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ExceedAndExcel
Champion Joined: 20 Dec 2008 Status: Offline Points: 16226 |
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Skiing is the perfect example! Remember the reports last winter of zero snow and people stuck with expensive non-refundable bookings? The money already paid is irrelevant. Do you dig your heels in, turn up and sit in your hotel room staring at an un-skiable mountain all weekend (getting more pissed off) or do you find something else to do? Money is already spent whatever you do so plays no part in the decision.
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Afros
Champion Joined: 14 Jan 2009 Status: Offline Points: 15302 |
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Wunwun, lets say you had put down a $5k non-refundable deposit on a new Toyota Forklift, with the remaining $25k to be paid upon you signing a contract to accept the deal, when an offer comes across your desk for another brand new same model Toyota Forklift, $15k and its yours, would you go ahead with the original purchase or accept the sunken cost and take up the second option that allows a greater saving overall?
Suspect this conundrum will present a challenge for you.
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Seeing Manchester United relegated would mean more than words can describe to me.
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Rhino
Champion Joined: 21 Nov 2013 Status: Offline Points: 1833 |
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Who pays a deposit without having a contract?
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Tlazolteotl
Champion Joined: 02 Oct 2012 Location: Elephant Butte Status: Offline Points: 31290 |
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Commonwealth Games analogy should use the worst car you can buy that nobody else wants. It's not like it was a potentially good deal that later turned into a lemon. It was always a lemon. Stupid from the start. |
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An honest politician is one who when he is bought will stay bought.
Simon Cameron |
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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And if you say "no" - then my argument is correct ! And I hope you don't say "no"" - but they should be ! Lets see how that "little conundrum" tickles your fancy
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mc41
Champion Joined: 20 Feb 2007 Location: Goldcoast Au Status: Offline Points: 4918 |
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I made plenty initial bad decisions that where aimed at being good down the track,majority of decisions made by business is based on financial outcomes,personal decisions maybe less so
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Don't worry MC 41 - I ALMOST made a bad decision as well
Obviously a good decision relies on how good the end result is premised. Not uncommon to work backwards
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Afros
Champion Joined: 14 Jan 2009 Status: Offline Points: 15302 |
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Lets be honest all business decisions have their roots in the financial implications of the decision. Of course there may be situations where a hit here can be taken as in the bigger picture you end up in front, say in the example above, the original seller may provide some benefit if you're happy to take the initial $10k hit that actually provides savings elsewhere that would not be available had you simply taken the cheaper machine. Of course you may make decisions outside of business that aren't necessarily dictated by the best financial outcome but thats not what the topic at hand is about.
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Seeing Manchester United relegated would mean more than words can describe to me.
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Well it sort of was Afros
How much of the original Commonwealth Games decision was ever based on a strong financial footing ? Rubbery figures from Day 1. I would suggest many Government initiatives are not dictated by the best financial outcome. So my point was those erroneous outcomes from the original financials are just as likely to be erroneous again - because the "vibe" happened to change. I'm sure someone else could have have come in - looked at the same information - & come to the conclusion it was on target to meet original goals. I mean it would be hardly the first time Governments got big proposals skew whiff.
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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To summarise - as I'm starting to go info overload drunk - I think the concept of "sunken costs" exists more in the heads of anal accountants than it does in the reality of normal people / governments making decisions.
The concept sounds good
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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And a good time to ask this question - can we treat our Renewables expenditure to this point as a "sunken cost" & start again.
The end result is not looking quite as rosy as once forecast
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mc41
Champion Joined: 20 Feb 2007 Location: Goldcoast Au Status: Offline Points: 4918 |
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Never going to be nuclear,so push on
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Afros
Champion Joined: 14 Jan 2009 Status: Offline Points: 15302 |
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You claim to own and run a successful business and think sunken cost is just a concept in the head of anal accountants. I hope for your sake your partners (both business and personal) have at least equal say in the running of the business lest your decisions lead to sunken cost fallacy.
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Seeing Manchester United relegated would mean more than words can describe to me.
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Thanks for that Afros
I’ll give it some thought
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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For what it’s worth I have never heard any of my Accountants use the term 🤔
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mc41
Champion Joined: 20 Feb 2007 Location: Goldcoast Au Status: Offline Points: 4918 |
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Accountants 😏
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Baghdad Bob
Champion Joined: 10 Feb 2010 Location: Victoria Status: Offline Points: 13595 |
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The Commonwealth
Games debacle reported by the Auditor-General demonstrates everything that is
wrong with the Victorian ALP government-
in policy formulation, costing and project management, transparency and accountability. The Games
were not determined in the public interest but as a stunt for buying votes in regional
electorates in Victoria. Costings-ordination and project management were
shambolic followed by dissimulation when the Games were abandoned with costs substantially
overstated. Typically
no responsibility has been taken for the fiasco, yet Jacinta Allan, the current
Premier of Victoria, was the responsible minister at that time. Irrespective
of that Commonwealth Games debacle the real question needed to be asked is: if
Allan cannot get the finances right for a 12-day sporting event, then how can
she be trusted to manage major infrastructure projects and the state budget? |
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rusty nails
Champion Joined: 20 Mar 2013 Location: Sydney Status: Offline Points: 11301 |
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It’s not an accounting term. It’s an economic or management term/concept.
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oneonesit
Champion Joined: 06 Aug 2012 Status: Online Points: 36892 |
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Picky, picky Rusty
Bloody hell !
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mc41
Champion Joined: 20 Feb 2007 Location: Goldcoast Au Status: Offline Points: 4918 |
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Majority of QLD don’t want the Olympic Games,total fiasco,both leaders playing games,not doing what’s best for QLD
🤬🤬🤬
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