The Anti-Regulators are the Job Killers

[Arraya]

From the Top of the Great Pyramid

http://theautomaticearth.blogspot.com/2008/11/debt-rattle-november-26-2008-from-top.html
Everyone has heard of pyramid, or Ponzi, schemes. In their simplest form they are short-lived deliberate frauds where a small number of existing members are paid from the buy-in of a larger number of newer members until the supply of newer members is exhausted, whereupon they collapse. Typically, the founders, and perhaps a few others who got in early and out before it was too late, end up making a lot of money at the expense of later entrants, who end up holding the empty bag. There are always many more losers than winners. What most do not realize, however, is that Ponzi dynamics are far more pervasive than people think. There are many human systems that ultimately rest on the buy-in of new entrants, and every one of them will ultimately meet the same fate, although it can take far longer for complex constructions than for simple pyramid frauds.

snip

At the largest scale, empires are also grounded in pyramid dynamics, which is why they too have a limited lifespan. They grow by assuming control, either politically or economically, of new territories, positioning themselves to cream off surpluses from an ever-expanding geographical area in a form of involuntary buy-in. In the past political control through invasion or physical colonization was more common, but latterly globalization has enabled the development of a sophisticated system of economic control based on international debt slavery, supplemented with economic colonization for the purpose of resource extraction. Both resources and financial surpluses, in the form of perpetual interest payments, could be efficiently extracted from the periphery and accumulated at the centre, where they led to the development of an unprecedented level of socioeconomic complexity.

[CA renter]

[quote=no_such_reality]So far you’ve all missed the difference between speculation and investing.

What people call investing is no longer investing, it is speculation.

In it’s own way, the speculators free the capital of the investors to do the real investment. But the speculator model that currently holds sway, rewards knowledge based gambling. You don’t invest in Google today, you speculate that tomorrow someone else is going to give you more for it because they think the next day someone else will give them even more.

Investing in Google would have been funding it as the start up or pre-startup because you understood the business model and ability to generate cash flow in the future by providing valuable services. However, that same investment may be speculation if the pay-off calculation is based on an IPO and the sell-off of a yet another ‘growth’ stock that relies on the ponzi model to generate returns.

It’s a fundamental problem with our market, IMHO. The speculative model rewards growth and valuation through ponzi-like investor replacement rather than generating direct sustainable cash flow (value) for the investors. The leadership viewpoint then becomes short term focused to juice the ponzi-multipiers.

A good example was Amazon at peak of the dotcom boom that had a PE ratio that translated to them having 100s of billions in revenues in the future with 10s of billions in earnings annually when a rationally imposed set of multipliers was used to value the similar to other successful high-margin (AMZN is low margin) companies.

[/soapbox]

That said, labor in and of itself is not good.[/quote]

No, I haven’t missed it, and agree 100% with your soapbox rant. Direct investment (share of ownership, loans, even grants, etc.) in businesses that provide useful goods and services qualifies as “investing” in my book. Buying existing stocks (or any kind of asset) in the hopes that you can later sell for a higher price is “speculating.”

[CA renter]

[quote=no_such_reality]So far you’ve all missed the difference between speculation and investing.

What people call investing is no longer investing, it is speculation.

In it’s own way, the speculators free the capital of the investors to do the real investment. But the speculator model that currently holds sway, rewards knowledge based gambling. You don’t invest in Google today, you speculate that tomorrow someone else is going to give you more for it because they think the next day someone else will give them even more.

Investing in Google would have been funding it as the start up or pre-startup because you understood the business model and ability to generate cash flow in the future by providing valuable services. However, that same investment may be speculation if the pay-off calculation is based on an IPO and the sell-off of a yet another ‘growth’ stock that relies on the ponzi model to generate returns.

It’s a fundamental problem with our market, IMHO. The speculative model rewards growth and valuation through ponzi-like investor replacement rather than generating direct sustainable cash flow (value) for the investors. The leadership viewpoint then becomes short term focused to juice the ponzi-multipiers.

A good example was Amazon at peak of the dotcom boom that had a PE ratio that translated to them having 100s of billions in revenues in the future with 10s of billions in earnings annually when a rationally imposed set of multipliers was used to value the similar to other successful high-margin (AMZN is low margin) companies.

[/soapbox]

That said, labor in and of itself is not good.[/quote]

No, I haven’t missed it, and agree 100% with your soapbox rant. Direct investment (share of ownership, loans, even grants, etc.) in businesses that provide useful goods and services qualifies as “investing” in my book. Buying existing stocks (or any kind of asset) in the hopes that you can later sell for a higher price is “speculating.”

[CA renter]

[quote=no_such_reality]So far you’ve all missed the difference between speculation and investing.

What people call investing is no longer investing, it is speculation.

In it’s own way, the speculators free the capital of the investors to do the real investment. But the speculator model that currently holds sway, rewards knowledge based gambling. You don’t invest in Google today, you speculate that tomorrow someone else is going to give you more for it because they think the next day someone else will give them even more.

Investing in Google would have been funding it as the start up or pre-startup because you understood the business model and ability to generate cash flow in the future by providing valuable services. However, that same investment may be speculation if the pay-off calculation is based on an IPO and the sell-off of a yet another ‘growth’ stock that relies on the ponzi model to generate returns.

It’s a fundamental problem with our market, IMHO. The speculative model rewards growth and valuation through ponzi-like investor replacement rather than generating direct sustainable cash flow (value) for the investors. The leadership viewpoint then becomes short term focused to juice the ponzi-multipiers.

A good example was Amazon at peak of the dotcom boom that had a PE ratio that translated to them having 100s of billions in revenues in the future with 10s of billions in earnings annually when a rationally imposed set of multipliers was used to value the similar to other successful high-margin (AMZN is low margin) companies.

[/soapbox]

That said, labor in and of itself is not good.[/quote]

No, I haven’t missed it, and agree 100% with your soapbox rant. Direct investment (share of ownership, loans, even grants, etc.) in businesses that provide useful goods and services qualifies as “investing” in my book. Buying existing stocks (or any kind of asset) in the hopes that you can later sell for a higher price is “speculating.”

[CA renter]

[quote=no_such_reality]So far you’ve all missed the difference between speculation and investing.

What people call investing is no longer investing, it is speculation.

In it’s own way, the speculators free the capital of the investors to do the real investment. But the speculator model that currently holds sway, rewards knowledge based gambling. You don’t invest in Google today, you speculate that tomorrow someone else is going to give you more for it because they think the next day someone else will give them even more.

Investing in Google would have been funding it as the start up or pre-startup because you understood the business model and ability to generate cash flow in the future by providing valuable services. However, that same investment may be speculation if the pay-off calculation is based on an IPO and the sell-off of a yet another ‘growth’ stock that relies on the ponzi model to generate returns.

It’s a fundamental problem with our market, IMHO. The speculative model rewards growth and valuation through ponzi-like investor replacement rather than generating direct sustainable cash flow (value) for the investors. The leadership viewpoint then becomes short term focused to juice the ponzi-multipiers.

A good example was Amazon at peak of the dotcom boom that had a PE ratio that translated to them having 100s of billions in revenues in the future with 10s of billions in earnings annually when a rationally imposed set of multipliers was used to value the similar to other successful high-margin (AMZN is low margin) companies.

[/soapbox]

That said, labor in and of itself is not good.[/quote]

No, I haven’t missed it, and agree 100% with your soapbox rant. Direct investment (share of ownership, loans, even grants, etc.) in businesses that provide useful goods and services qualifies as “investing” in my book. Buying existing stocks (or any kind of asset) in the hopes that you can later sell for a higher price is “speculating.”

[CA renter]

[quote=no_such_reality]So far you’ve all missed the difference between speculation and investing.

What people call investing is no longer investing, it is speculation.

In it’s own way, the speculators free the capital of the investors to do the real investment. But the speculator model that currently holds sway, rewards knowledge based gambling. You don’t invest in Google today, you speculate that tomorrow someone else is going to give you more for it because they think the next day someone else will give them even more.

Investing in Google would have been funding it as the start up or pre-startup because you understood the business model and ability to generate cash flow in the future by providing valuable services. However, that same investment may be speculation if the pay-off calculation is based on an IPO and the sell-off of a yet another ‘growth’ stock that relies on the ponzi model to generate returns.

It’s a fundamental problem with our market, IMHO. The speculative model rewards growth and valuation through ponzi-like investor replacement rather than generating direct sustainable cash flow (value) for the investors. The leadership viewpoint then becomes short term focused to juice the ponzi-multipiers.

A good example was Amazon at peak of the dotcom boom that had a PE ratio that translated to them having 100s of billions in revenues in the future with 10s of billions in earnings annually when a rationally imposed set of multipliers was used to value the similar to other successful high-margin (AMZN is low margin) companies.

[/soapbox]

That said, labor in and of itself is not good.[/quote]

No, I haven’t missed it, and agree 100% with your soapbox rant. Direct investment (share of ownership, loans, even grants, etc.) in businesses that provide useful goods and services qualifies as “investing” in my book. Buying existing stocks (or any kind of asset) in the hopes that you can later sell for a higher price is “speculating.”

[CA renter]

[quote=pri_dk][quote=CA renter]Just a cursory look at the top 20 shows quite a few are heirs to fortunes, not self-made…[/quote]

Sam Walton had a few kids.

Some trivia: Sam opened his first Wal Mart when he was 44 years old. There’s still plenty of time for many of us to make it to the top!

[quote]We have to decide if we want to continue rewarding gambling and speculation over productive labor. […] pushing everyone into “investing,” rather than working. This is not sustainable over the long run.[/quote]

Have you been reading Marx? That’s pretty much a summary of his main argument.

The fundamental flaw in his verbose ramblings is that he essentially valued labor for labor’s sake, and neglected the value of investment choices that continually makes labor more productive.

The foundation of economic progress is not work, it is choices.[/quote]

Not just the Waltons…from the top 20: Koch, Johnson, Mars, Cox, Kaiser, etc. are all rich because of family money or businesses. Basically, the majority of the top 20 most wealthy people inherited their positions or were helped to a very large degree by their families.
———————

Yes, I’ve read Marx, and think he was right on many more points than the “trickle-down, free-trade, capitalists” who couldn’t see this financial crisis coming. Marx certainly saw it coming. Who do you give more weight to, the one who clearly understood the eventual outcome of “capitalism” as we know it, or the “trickle down/pro-capitalism” theoists who (claim that they) didn’t see the financial crisis coming?

[CA renter]

[quote=pri_dk][quote=CA renter]Just a cursory look at the top 20 shows quite a few are heirs to fortunes, not self-made…[/quote]

Sam Walton had a few kids.

Some trivia: Sam opened his first Wal Mart when he was 44 years old. There’s still plenty of time for many of us to make it to the top!

[quote]We have to decide if we want to continue rewarding gambling and speculation over productive labor. […] pushing everyone into “investing,” rather than working. This is not sustainable over the long run.[/quote]

Have you been reading Marx? That’s pretty much a summary of his main argument.

The fundamental flaw in his verbose ramblings is that he essentially valued labor for labor’s sake, and neglected the value of investment choices that continually makes labor more productive.

The foundation of economic progress is not work, it is choices.[/quote]

Not just the Waltons…from the top 20: Koch, Johnson, Mars, Cox, Kaiser, etc. are all rich because of family money or businesses. Basically, the majority of the top 20 most wealthy people inherited their positions or were helped to a very large degree by their families.
———————

Yes, I’ve read Marx, and think he was right on many more points than the “trickle-down, free-trade, capitalists” who couldn’t see this financial crisis coming. Marx certainly saw it coming. Who do you give more weight to, the one who clearly understood the eventual outcome of “capitalism” as we know it, or the “trickle down/pro-capitalism” theoists who (claim that they) didn’t see the financial crisis coming?

[CA renter]

[quote=pri_dk][quote=CA renter]Just a cursory look at the top 20 shows quite a few are heirs to fortunes, not self-made…[/quote]

Sam Walton had a few kids.

Some trivia: Sam opened his first Wal Mart when he was 44 years old. There’s still plenty of time for many of us to make it to the top!

[quote]We have to decide if we want to continue rewarding gambling and speculation over productive labor. […] pushing everyone into “investing,” rather than working. This is not sustainable over the long run.[/quote]

Have you been reading Marx? That’s pretty much a summary of his main argument.

The fundamental flaw in his verbose ramblings is that he essentially valued labor for labor’s sake, and neglected the value of investment choices that continually makes labor more productive.

The foundation of economic progress is not work, it is choices.[/quote]

Not just the Waltons…from the top 20: Koch, Johnson, Mars, Cox, Kaiser, etc. are all rich because of family money or businesses. Basically, the majority of the top 20 most wealthy people inherited their positions or were helped to a very large degree by their families.
———————

Yes, I’ve read Marx, and think he was right on many more points than the “trickle-down, free-trade, capitalists” who couldn’t see this financial crisis coming. Marx certainly saw it coming. Who do you give more weight to, the one who clearly understood the eventual outcome of “capitalism” as we know it, or the “trickle down/pro-capitalism” theoists who (claim that they) didn’t see the financial crisis coming?

[CA renter]

[quote=pri_dk][quote=CA renter]Just a cursory look at the top 20 shows quite a few are heirs to fortunes, not self-made…[/quote]

Sam Walton had a few kids.

Some trivia: Sam opened his first Wal Mart when he was 44 years old. There’s still plenty of time for many of us to make it to the top!

[quote]We have to decide if we want to continue rewarding gambling and speculation over productive labor. […] pushing everyone into “investing,” rather than working. This is not sustainable over the long run.[/quote]

Have you been reading Marx? That’s pretty much a summary of his main argument.

The fundamental flaw in his verbose ramblings is that he essentially valued labor for labor’s sake, and neglected the value of investment choices that continually makes labor more productive.

The foundation of economic progress is not work, it is choices.[/quote]

Not just the Waltons…from the top 20: Koch, Johnson, Mars, Cox, Kaiser, etc. are all rich because of family money or businesses. Basically, the majority of the top 20 most wealthy people inherited their positions or were helped to a very large degree by their families.
———————

Yes, I’ve read Marx, and think he was right on many more points than the “trickle-down, free-trade, capitalists” who couldn’t see this financial crisis coming. Marx certainly saw it coming. Who do you give more weight to, the one who clearly understood the eventual outcome of “capitalism” as we know it, or the “trickle down/pro-capitalism” theoists who (claim that they) didn’t see the financial crisis coming?

[CA renter]

[quote=pri_dk][quote=CA renter]Just a cursory look at the top 20 shows quite a few are heirs to fortunes, not self-made…[/quote]

Sam Walton had a few kids.

Some trivia: Sam opened his first Wal Mart when he was 44 years old. There’s still plenty of time for many of us to make it to the top!

[quote]We have to decide if we want to continue rewarding gambling and speculation over productive labor. […] pushing everyone into “investing,” rather than working. This is not sustainable over the long run.[/quote]

Have you been reading Marx? That’s pretty much a summary of his main argument.

The fundamental flaw in his verbose ramblings is that he essentially valued labor for labor’s sake, and neglected the value of investment choices that continually makes labor more productive.

The foundation of economic progress is not work, it is choices.[/quote]

Not just the Waltons…from the top 20: Koch, Johnson, Mars, Cox, Kaiser, etc. are all rich because of family money or businesses. Basically, the majority of the top 20 most wealthy people inherited their positions or were helped to a very large degree by their families.
———————

Yes, I’ve read Marx, and think he was right on many more points than the “trickle-down, free-trade, capitalists” who couldn’t see this financial crisis coming. Marx certainly saw it coming. Who do you give more weight to, the one who clearly understood the eventual outcome of “capitalism” as we know it, or the “trickle down/pro-capitalism” theoists who (claim that they) didn’t see the financial crisis coming?

[CA renter]

[quote=Arraya][quote=CA renter]
I don’t have too much of a problem with capitalism, if only we could find an actual example in the real world that is devoid of corruption and monopolies that eventually lead to the implosion of an economy, with the poor being made to suffer for the benefit of the wealthy. This is where we stand today, unfortunately.[/quote]

Corruption, crises, monopolies and cartels are a feature not an aberration. Or rather a systemic tendency – with wealth concentration and accumulation as the driver of these features. People can go round and round about regulations being good, bad, too much too or too little as reasons for these issues(and astute observers and skilled writers can be, on some level, correct about many interpretations) but the common denominator is always accumulation of capital. Being that is the object of the *game* we all play, it is heretical to shine a light on that as cause. Actually, regulation is often a matter of whom does it benefit, rather than, is it good or bad. Now, you will not find much regulation, or at least major regulation, over the past few decades that does not support wealth accumulation to the people that are most influential in crafting said regulation. Rising tides lift all ships, don’t you know[/quote]

Amen, Arraya.

[CA renter]

[quote=Arraya][quote=CA renter]
I don’t have too much of a problem with capitalism, if only we could find an actual example in the real world that is devoid of corruption and monopolies that eventually lead to the implosion of an economy, with the poor being made to suffer for the benefit of the wealthy. This is where we stand today, unfortunately.[/quote]

Corruption, crises, monopolies and cartels are a feature not an aberration. Or rather a systemic tendency – with wealth concentration and accumulation as the driver of these features. People can go round and round about regulations being good, bad, too much too or too little as reasons for these issues(and astute observers and skilled writers can be, on some level, correct about many interpretations) but the common denominator is always accumulation of capital. Being that is the object of the *game* we all play, it is heretical to shine a light on that as cause. Actually, regulation is often a matter of whom does it benefit, rather than, is it good or bad. Now, you will not find much regulation, or at least major regulation, over the past few decades that does not support wealth accumulation to the people that are most influential in crafting said regulation. Rising tides lift all ships, don’t you know[/quote]

Amen, Arraya.

[CA renter]

[quote=Arraya][quote=CA renter]
I don’t have too much of a problem with capitalism, if only we could find an actual example in the real world that is devoid of corruption and monopolies that eventually lead to the implosion of an economy, with the poor being made to suffer for the benefit of the wealthy. This is where we stand today, unfortunately.[/quote]

Corruption, crises, monopolies and cartels are a feature not an aberration. Or rather a systemic tendency – with wealth concentration and accumulation as the driver of these features. People can go round and round about regulations being good, bad, too much too or too little as reasons for these issues(and astute observers and skilled writers can be, on some level, correct about many interpretations) but the common denominator is always accumulation of capital. Being that is the object of the *game* we all play, it is heretical to shine a light on that as cause. Actually, regulation is often a matter of whom does it benefit, rather than, is it good or bad. Now, you will not find much regulation, or at least major regulation, over the past few decades that does not support wealth accumulation to the people that are most influential in crafting said regulation. Rising tides lift all ships, don’t you know[/quote]

Amen, Arraya.

[CA renter]

[quote=Arraya][quote=CA renter]
I don’t have too much of a problem with capitalism, if only we could find an actual example in the real world that is devoid of corruption and monopolies that eventually lead to the implosion of an economy, with the poor being made to suffer for the benefit of the wealthy. This is where we stand today, unfortunately.[/quote]

Corruption, crises, monopolies and cartels are a feature not an aberration. Or rather a systemic tendency – with wealth concentration and accumulation as the driver of these features. People can go round and round about regulations being good, bad, too much too or too little as reasons for these issues(and astute observers and skilled writers can be, on some level, correct about many interpretations) but the common denominator is always accumulation of capital. Being that is the object of the *game* we all play, it is heretical to shine a light on that as cause. Actually, regulation is often a matter of whom does it benefit, rather than, is it good or bad. Now, you will not find much regulation, or at least major regulation, over the past few decades that does not support wealth accumulation to the people that are most influential in crafting said regulation. Rising tides lift all ships, don’t you know[/quote]

Amen, Arraya.

[Author]

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