ESSAY QUESTION:
The following appeared in the personal finance section of a popular magazine:
"The average price of an acre of land in the United States is now 50 times what it was in 1970, and nearly 200 times what it was in 1920. The nation's population is projected to keep increasing, even as the amount of land remains constant. Therefore, people who are approaching retirement should invest heavily in real estate in order to ensure their financial security."
Discuss how well reasoned you find this argument. In your discussion be sure to analyze the line of reasoning and the use of evidence in the argument. For example, you may need to consider what questionable assumptions underlie the thinking and what alternative explanations or counterexamples might weaken the conclusion. You can also discuss what sort of evidence would strengthen or refute the argument, what changes in the argument would make it more logically sound, and what, if anything, would help you better evaluate its conclusion.
YOUR RESPONSE:
The author in the personal finance magazine suggests that people nearing retirement must heavily invest in real estate as it has historically given high returns .This argument though seems logical lends itself to many flaws,which I will discuss below .
The most important flaw in the argument is that of historical reasoning.The author solely relies on history of a investment avenue to conclude that it will provide similar returns in the future .We don't know what factors caused the returns to rise ,moreover we need to know that those factors or some other factor will still cause the land price to rise .The classic example that history may always not be true is the current sub - prime crisis where banks ,based on similar reasoning as that of author, bet that house prices wont fall but it eventually did and caused a huge crisis .A person following authors advice is also prone to such a crisis if he does not have any other sources of income .
The second flaw in the argument is the class of people for whom the author recommends the investment .The author has not given any reason as to why only people nearing retirement have to invest in land and not any other class of people .If the returns are high it must be true for anyone investing in the said instrument.Moreover the time author mentions in the argument is typically long in the order of about 30 - 40 years by that time the people nearing retirement may not be in a position to enjoy the returns generated
for example a person in in his 40's who makes a investment in real estate can only expect the high returns promised by the author only when he is in his 70's by that time he may not be in a condition to enjoy the money .
In conclusion, the argument mainly falters by adopting a historical reasoning and targeting consumers who may not be able to derive much use for the advice mentioned .This argument however can be made into a more logical one by including factors why the price of land will keep increasing ,and showing why the investment is the best option for people nearing retirement .
The following appeared in the personal finance section of a popular magazine:
"The average price of an acre of land in the United States is now 50 times what it was in 1970, and nearly 200 times what it was in 1920. The nation's population is projected to keep increasing, even as the amount of land remains constant. Therefore, people who are approaching retirement should invest heavily in real estate in order to ensure their financial security."
Discuss how well reasoned you find this argument. In your discussion be sure to analyze the line of reasoning and the use of evidence in the argument. For example, you may need to consider what questionable assumptions underlie the thinking and what alternative explanations or counterexamples might weaken the conclusion. You can also discuss what sort of evidence would strengthen or refute the argument, what changes in the argument would make it more logically sound, and what, if anything, would help you better evaluate its conclusion.
YOUR RESPONSE:
The author in the personal finance magazine suggests that people nearing retirement must heavily invest in real estate as it has historically given high returns .This argument though seems logical lends itself to many flaws,which I will discuss below .
The most important flaw in the argument is that of historical reasoning.The author solely relies on history of a investment avenue to conclude that it will provide similar returns in the future .We don't know what factors caused the returns to rise ,moreover we need to know that those factors or some other factor will still cause the land price to rise .The classic example that history may always not be true is the current sub - prime crisis where banks ,based on similar reasoning as that of author, bet that house prices wont fall but it eventually did and caused a huge crisis .A person following authors advice is also prone to such a crisis if he does not have any other sources of income .
The second flaw in the argument is the class of people for whom the author recommends the investment .The author has not given any reason as to why only people nearing retirement have to invest in land and not any other class of people .If the returns are high it must be true for anyone investing in the said instrument.Moreover the time author mentions in the argument is typically long in the order of about 30 - 40 years by that time the people nearing retirement may not be in a position to enjoy the returns generated
for example a person in in his 40's who makes a investment in real estate can only expect the high returns promised by the author only when he is in his 70's by that time he may not be in a condition to enjoy the money .
In conclusion, the argument mainly falters by adopting a historical reasoning and targeting consumers who may not be able to derive much use for the advice mentioned .This argument however can be made into a more logical one by including factors why the price of land will keep increasing ,and showing why the investment is the best option for people nearing retirement .
