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Thread: Inauguration Day, Inauguration Hooooooraaay!

  1. #1401
    Admiral of Awesome
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    Quote Originally Posted by Wookie06 View Post
    Of course I'd look at the performance of the funds first before making the assertion. I understand what active management is but I kind of look at an ETF as a fund that the investor can actively manage similar to the way a day trader might. I am not saying they're the same of course. Anyway, you point was with regard to antitrust prosecution. Since I'm mostly skipping large chunks of this thread now, could you explain how you mean that?
    You can have active managed ETFs but most of them track indexes or bonds.

    The reason ETFs are an antitrust concern - really I mean index funds here - is because of common ownership. For example, I think I read somewhere that something like 60% of United's stock is held in funds that also hold stock in other airlines. That's a massive conflict of interest because managers are required to act in the best interests of the shareholders. If United and Delta are majority-owned by the same group of people, that means collusion and market division. And that's exactly what you see in major airlines, telecoms, insurance, and many other industries in the US.

    That's the antitrust theory, at least. In reality common ownership actually reduces collusion because, among other things, there is no real benefit to owning two companies that divide a market versus a single company that dominates it. The antitrust bit is really about inventing a way of undermining the legality of an investment vehicle that denies very rich financial services corporations funds management fees.

  2. #1402
    Quote Originally Posted by Krokodile View Post
    Whoa. You're friends with Donald Trump??
    Absolutely. He only accused my late father of conspiring to assassinate Reagan twice!
    "I would rather claim to be an uneducated man than be mal-educated and claim to be otherwise." - Wookie 03:16


  3. #1403
    Quote Originally Posted by Jon`C View Post
    You can have active managed ETFs but most of them track indexes or bonds.

    The reason ETFs are an antitrust concern - really I mean index funds here - is because of common ownership. For example, I think I read somewhere that something like 60% of United's stock is held in funds that also hold stock in other airlines. That's a massive conflict of interest because managers are required to act in the best interests of the shareholders. If United and Delta are majority-owned by the same group of people, that means collusion and market division. And that's exactly what you see in major airlines, telecoms, insurance, and many other industries in the US.

    That's the antitrust theory, at least. In reality common ownership actually reduces collusion because, among other things, there is no real benefit to owning two companies that divide a market versus a single company that dominates it. The antitrust bit is really about inventing a way of undermining the legality of an investment vehicle that denies very rich financial services corporations funds management fees.
    Okay, got it. I noticed some posts about United and figured I missed the connection, no pun intended. I've despised them for years and would only choose them as a carrier if there were no other practical options.
    "I would rather claim to be an uneducated man than be mal-educated and claim to be otherwise." - Wookie 03:16


  4. #1404

  5. #1405
    Interesting and informative but the bias and agenda is blatant. Glad you shared it.
    "I would rather claim to be an uneducated man than be mal-educated and claim to be otherwise." - Wookie 03:16


  6. #1406
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    Quote Originally Posted by Wookie06 View Post
    Interesting and informative but the bias and agenda is blatant. Glad you shared it.
    Mainstream Democrat version: https://fivethirtyeight.com/features...too-damn-high/

    Libertarian version: https://www.cato.org/publications/ca...e-rent-seeking

    New Keynesian version: https://promarket.org/nobel-laureate...ng-inequality/

    Neoliberal/globalist version: http://www.economist.com/news/briefi...uch-good-thing

    (Note to the beginner: The official position of The Economist is that rent-seeking only happens in countries that don't have free trade agreements with the US. However, it's easy to find complaints about US rentiers in their articles, you just need to know how to recognize rent-seeking behavior when it happens.)

    I really don't know what you want, here. Do you want a balanced article that points out the positives of rent-seeking? You don't know much about economics, so let me tell you: that's like asking for an article that fairly points out the benefits of cancer. Rent-seeking is economic cancer. It is a very bad thing. There is no "bias" or "agenda", they are empirically bad. They happen due to, and reward, bad actors. They shrink the economy, destroy jobs, rob you of your livelihood and quality of life. There is nothing good that anybody can say about economic rents or the billionaires who seek them, no matter where you are on the economic spectrum (see above for examples).

    Or, what, are you waiting for CNN or Fox to publish a retort? lol, some billionaire-owned megacorporation writing an article talking about how great billionaires and megacorporations are? Is that really of any value to you?
    Last edited by Jon`C; 04-17-2017 at 02:20 AM.

  7. #1407
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    (Let me know when you've been sufficiently redpilled into believing that rent-seeking is a huge problem. Then we can move on to phase 2, when I teach you that capitalism and rent-seeking are the same thing. Then we can move on to phase 3, glorious revolution.)

  8. #1408
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    Quote Originally Posted by Wookie06 View Post
    Interesting and informative but the bias and agenda is blatant. Glad you shared it.
    Yeah, I don't know if you know what you're defending here. The U.S. sucks and our economics are ruining the country.

  9. #1409
    Quote Originally Posted by Reid View Post
    Yeah, I don't know if you know what you're defending here. The U.S. sucks and our economics are ruining the country.
    I'm confused. I don't understand why you think I'm defending anything.

  10. #1410
    I really don't know what you want, here...Or, what, are you waiting for CNN or Fox to publish a retort?
    I didn't mind the obvious bias. I probably would have enjoyed it less if the author tried to obscure it. I'm mobile right now but intend to view your other links and respond more fully.

  11. #1411
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    Quote Originally Posted by Wookie06 View Post
    I'm confused. I don't understand why you think I'm defending anything.
    Maybe I just don't get what you're saying. What's the bias of the article?

  12. #1412
    It's boised to facts instead of alternate ones
    sniff

  13. #1413
    Quote Originally Posted by Reid View Post
    Maybe I just don't get what you're saying. What's the bias of the article?
    Well, look at his suggestions to "distribute" or earnings.

    And we can more fairly distribute our earnings on land, oil, and innovation through a system of, say, employee shares, or a universal basic income.
    He pines for the days that Ivy Leaguers supposedly chose unproductive "careers in science, public service or education". Now "science" in quotes because it's ridiculously vague aside, going straight into public service or teaching I've generally considered to be terrible. Certainly it's a quaint notion but I've always thought it makes more sense for someone to gain productive real world experience and bring that to teaching and public service. Probably not always practical and certainly not always necessary but generally superior.

    And these few sentences are problematic and can generate a lengthy discussion alone:

    Yet it doesn’t have to be this way. Tollgates can be torn down, financial products can be banned, tax havens dismantled, lobbies tamed, and patents rejected. Higher taxes on the ultra-rich can make rentierism less attractive, precisely because society’s biggest freeloaders are at the very top of the pyramid.
    Quote Originally Posted by Jon`C View Post
    I really don't know what you want, here. Do you want a balanced article that points out the positives of rent-seeking? You don't know much about economics, so let me tell you: that's like asking for an article that fairly points out the benefits of cancer. Rent-seeking is economic cancer. It is a very bad thing. There is no "bias" or "agenda", they are empirically bad.
    Well, let's look at a few cases.

    A bank offers mortgage products. The average person can find themselves in a situation where they can apply for a loan at a reasonable fixed interest rate, and purchase a home they could not otherwise afford and do so at a cost lower than leasing a home from a landlord. The bank will profit from the loan and it should. There's nothing wrong with this sort of responsible lending.

    Another person might not be able to qualify for a fair loan or purchasing a home might not make sense for any of a number of reasons so they may choose to rent a home. The landlord assumes risk in this situation and should maintain a reasonable profit on the property to cover the risk. I'd actually like to discuss this more but that doesn't have to be now.

    A person that would have no other viable avenue to broadcast content and earn money doing so might upload videos to YouTube (a topic I've been meaning to bring up for a couple years and now we see some turmoil with it). Google profits from content they did virtually nothing to produce but so does the YouTuber that wouldn't have made any money producing videos on their own.

    Quote Originally Posted by Jon`C View Post
    They happen due to, and reward, bad actors. They shrink the economy, destroy jobs, rob you of your livelihood and quality of life. There is nothing good that anybody can say about economic rents or the billionaires who seek them, no matter where you are on the economic spectrum (see above for examples).
    You poopooed me once for suggesting that consumer credit was a huge problem. It seems to me this is essentially just like what you rail against now. I personally find the level to which we can all finance every single thing in our life now disgusting. Not counting mortgage debt, the most consumer credit debt I ever had was around $60,000. I only ever financed one vehicle at a time and all but one was used (and the brand new 1991 Ford Escort really wasn't too out of line). Hell, I haven't even bought ten cars in my lifetime. Most of it credit card debt. I knew how bad it was and how much wealth it was costing me and it still took me years to finally reprogram. We have become a culture that loves debt, mostly because we're all brainwashed and I'm totally against it but there is a large "choice" component here, at least for individuals.

    Quote Originally Posted by Jon`C View Post
    Or, what, are you waiting for CNN or Fox to publish a retort? lol, some billionaire-owned megacorporation writing an article talking about how great billionaires and megacorporations are? Is that really of any value to you?
    Nope, nothing like that. There's quite a bit more I can say on the what I quoted from the article but not yet. I'm not really arguing with much of the article, really.
    "I would rather claim to be an uneducated man than be mal-educated and claim to be otherwise." - Wookie 03:16


  14. #1414
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    Quote Originally Posted by Wookie06 View Post
    Well, look at his suggestions to "distribute" or earnings.
    Oil, land use, and innovation are excellent examples of things that the public funds or provides, which companies take and use to their benefit without contributing anything back. You can perhaps argue that a factory owner is entitled to a share of the profits, but you can't seriously suggest the same thing for land seized via eminent domain, mining national forests, conspicuous pollution, or even high tech research, which is almost universally conducted at universities under government grants. The public is entitled to a share in the wealth generated from these activities, since the public is ultimately paying for those activities, and assuming the risks of those activities.

    For example, the NSF paid for Google's core technologies. How did Google repay America for its key investment? By abusing foreign tax loopholes. The US government paid for Google's tech, the US government granted Google monopoly use of that tech, and Google isn't paying their taxes. This is exactly the kind of behavior that should be harshly punished.

    He pines for the days that Ivy Leaguers supposedly chose unproductive "careers in science, public service or education".
    The mistaken conflation between productivity and profitability is a central point of the article you're talking about.

    Now "science" in quotes because it's ridiculously vague aside, going straight into public service or teaching I've generally considered to be terrible. Certainly it's a quaint notion but I've always thought it makes more sense for someone to gain productive real world experience and bring that to teaching and public service. Probably not always practical and certainly not always necessary but generally superior.
    What do you consider "real world experience", and how do those experiences translate to public service or teaching? Please be specific.

    And these few sentences are problematic and can generate a lengthy discussion alone:

    Well, let's look at a few cases.

    A bank offers mortgage products. The average person can find themselves in a situation where they can apply for a loan at a reasonable fixed interest rate, and purchase a home they could not otherwise afford and do so at a cost lower than leasing a home from a landlord. The bank will profit from the loan and it should. There's nothing wrong with this sort of responsible lending.
    2007.

    Another person might not be able to qualify for a fair loan or purchasing a home might not make sense for any of a number of reasons so they may choose to rent a home. The landlord assumes risk in this situation and should maintain a reasonable profit on the property to cover the risk. I'd actually like to discuss this more but that doesn't have to be now.
    This isn't what economic rent means.

    A person that would have no other viable avenue to broadcast content and earn money doing so might upload videos to YouTube (a topic I've been meaning to bring up for a couple years and now we see some turmoil with it). Google profits from content they did virtually nothing to produce but so does the YouTuber that wouldn't have made any money producing videos on their own.
    Profiting from hosting videos is not an economic rent by itself.

    The problem with YouTube is that they have a monopoly, so they can extract an outsized share of the revenue from hosting videos versus a competitive market where content creators can shop around. They also have industry-unique arrangements for cheap bandwidth, so they can run their services more cheaply than other companies. They also have special arrangements with major corporations to handle copyright violations via back channels, which saves them a lot of money dealing with legal matters versus an upstart. These are YouTube's economic rents, their unfair advantage extracted from the economy based on who they are, rather than what they do.

    You poopooed me once for suggesting that consumer credit was a huge problem. It seems to me this is essentially just like what you rail against now.
    I don't remember this discussion, but if it happened, I bet my point was a lot more nuanced than how you're representing it here.

    The problem with debt today is lax lending standards due to the moral hazard of industry consolidation, lack of effective regulation for down payment size/amortization period/LTV, and central banks that intentionally hold inflation near 0% in order to maximize financial firm profitability. Debt is a good thing when it's shaped like advanced consumption, not when it's shaped like a lease.

    I personally find the level to which we can all finance every single thing in our life now disgusting. Not counting mortgage debt, the most consumer credit debt I ever had was around $60,000. I only ever financed one vehicle at a time and all but one was used (and the brand new 1991 Ford Escort really wasn't too out of line). Hell, I haven't even bought ten cars in my lifetime. Most of it credit card debt. I knew how bad it was and how much wealth it was costing me and it still took me years to finally reprogram. We have become a culture that loves debt, mostly because we're all brainwashed and I'm totally against it but there is a large "choice" component here, at least for individuals.
    It's not much of a choice. Mass proliferation of debt drives up the prices of absolutely everything, but most significantly housing, cars, and education, where long-term debt has become fully normalized. It's very difficult to afford those kinds of things without going into debt.
    Last edited by Jon`C; 04-17-2017 at 07:42 PM.

  15. #1415
    Perception of "bias" = the hunch that truly appreciating the author's point would upset a long held prior of mine, which, incidentally, has until now stopped me from reaching the author's conclusions.

    Of course, if my prior is a fact, this is how rational thought is supposed to work. OTOH, if I can't even reconstruct the relevant prior from memory, and would rather focus on the flaws of the point of view which upsets it, then this is no better than disavowing science because it contradicts some naive interpretation of the bible I heard somewhere.

  16. #1416
    Quote Originally Posted by Reverend Jones View Post
    Perception of "bias" = the hunch that truly appreciating the author's point would upset a long held prior of mine, which, incidentally, has until now stopped me from reaching the author's conclusions.
    Look douche, are you saying that recognizing bias is the same as not being able to appreciate "the author's point"? It was an easy to read article where the author did not hide his bias and that's refreshing.

    Quote Originally Posted by Jon`C View Post
    Oil, land use, and innovation are excellent examples of things that the public funds or provides, which companies take and use to their benefit without contributing anything back. You can perhaps argue that a factory owner is entitled to a share of the profits, but you can't seriously suggest the same thing for land seized via eminent domain, mining national forests, conspicuous pollution, or even high tech research, which is almost universally conducted at universities under government grants. The public is entitled to a share in the wealth generated from these activities, since the public is ultimately paying for those activities, and assuming the risks of those activities.
    To some degree each of those can be discussed but isn't the "public" sharing in the wealth when taxes are paid? I'm actually against corporate taxes (and income and property to name a few) and I'm for tearing apart the current system.

    Quote Originally Posted by Jon`C View Post
    For example, the NSF paid for Google's core technologies. How did Google repay America for its key investment? By abusing foreign tax loopholes. The US government paid for Google's tech, the US government granted Google monopoly use of that tech, and Google isn't paying their taxes. This is exactly the kind of behavior that should be harshly punished.
    I would say it's the sort of behavior that must be changed. Corporations wouldn't have to resort to such maneuvering if it weren't for the tax code and the federal government probably shouldn't be creating monstrous corporations.

    Quote Originally Posted by Jon`C View Post
    What do you consider "real world experience", and how do those experiences translate to public service or teaching? Please be specific.
    Certainly there's no real experience required for most basic education other than possibly having raised children but certainly once you get to higher levels actually having practiced what you teach is a strong positive. For example, I've never been employed as a welder but I can probably teach you how to weld. I won't be able to teach you very well though. I simply don't have a varied welding experience and neither you nor I will be a good welder or teacher until we have experience. Now when it comes to things like macro economics or climate science there probably isn't any actual work experience that's going to help in a field that's mostly theoretical. I'm sure you are a much better teacher in subjects you have work experience in than before you had such experience.

    When it comes to public service, too many times people that work in a field are forced to deal with people with little experience that enforce rules written by people with little experience and often rules are enforced punitively. The transportation industry comes to mind.

    Quote Originally Posted by Jon`C View Post
    2007.
    That's really the culmination of years of bad policy. For the genesis I think you have to go back to the late 90s.

    Quote Originally Posted by Jon`C View Post
    This isn't what economic rent means.
    Of course but it's a basic example. There are corporations that run huge rental operations and that, to me, seems like economic rent.

    Quote Originally Posted by Jon`C View Post
    The problem with YouTube is that they have a monopoly, so they can extract an outsized share of the revenue from hosting videos versus a competitive market where content creators can shop around.
    Well, it's really hard to compete with free.

    Quote Originally Posted by Jon`C View Post
    They also have industry-unique arrangements for cheap bandwidth, so they can run their services more cheaply than other companies. They also have special arrangements with major corporations to handle copyright violations via back channels, which saves them a lot of money dealing with legal matters versus an upstart. These are YouTube's economic rents, their unfair advantage extracted from the economy based on who they are, rather than what they do.
    I think this is interesting because why should they not be free to engage other entities that relate to its business? I know this recently came up when one of the cell phone providers had a deal that Netflix streaming would not take up monthly data. I don't know if that got shut down or not but it was said to be unfair. I would be pretty happy if all of the streaming services I use entered into an agreement with Verizon and if they all entered into agreements with someone else I'd just keep doing things the way I do on Verizon because, yes, that 1% difference in customer satisfaction does matter to me mister-used-to-be-verizon guy.

    Quote Originally Posted by Jon`C View Post
    I don't remember this discussion, but if it happened, I bet my point was a lot more nuanced than how you're representing it here.
    I think it was in the chat. It wasn't a big deal and I'm not trying to present it as bigger than it was but I still guess I see this as a bigger problem.

    Quote Originally Posted by Jon`C View Post
    It's not much of a choice. Mass proliferation of debt drives up the prices of absolutely everything, but most significantly housing, cars, and education, where long-term debt has become fully normalized. It's very difficult to afford those kinds of things without going into debt.
    Housing is a problem but I'm not sure it's mostly due to debt. I wish my parents could have kept a home long enough to profit from one. Real estate in the Seattle area is ridiculous. Sometimes I catch one of the house flipping shows in the LA area and dumps go for insane money and then there huge after a quick reno. Really when you look at it a house is probably the only thing the vast majority of people need to finance. You can buy a used car for a few hundred to a few thousand. You can work your way through a state school. But I imagine trying to live remotely close to a traditional employer in an established area is horribly hard.

    I'm not really arguing with you. I know you tend to discuss macro and I'm more grounded in micro. At some point in our society we probably will have to move more toward macro is micro, if that makes any sense.
    "I would rather claim to be an uneducated man than be mal-educated and claim to be otherwise." - Wookie 03:16


  17. #1417
    Really, I'm just wondering when Trump is going to announce that Bill O'Reilly is his new press secretary.
    "I would rather claim to be an uneducated man than be mal-educated and claim to be otherwise." - Wookie 03:16


  18. #1418
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    Quote Originally Posted by Jon`C View Post
    (Let me know when you've been sufficiently redpilled into believing that rent-seeking is a huge problem. Then we can move on to phase 2, when I teach you that capitalism and rent-seeking are the same thing. Then we can move on to phase 3, glorious revolution.)

    It seems to me that the main advantage of capitalism is that it assumes rent seeking behavior and tries to take advantage of that. Rent seeking is going to crop up no matter how you organize society. We don't necessarily do the greatest job at dealing with it, but fixing rent seeking is non-trivial. Almost by definition, the most powerful people in a society are going to be the ones who are the best at rent seeking. I'm not sure how you'd fix it outside of cultural values that strongly reject it.

    Complaining that people take advantage of the system is just stupid. Of course people take advantage of the system. The whole point of the system is to stop people from getting an unfair advantage. If people find loopholes, than the system isn't doing its job. We need to hold legislators to a higher standard. Passing populist legislation isn't the same as passing effective legislation. "More" regulation doesn't mean anything.
    Last edited by Obi_Kwiet; 04-20-2017 at 11:43 AM.

  19. #1419
    are you saying that recognizing bias is the same as not being able to appreciate "the author's point"?
    Possibly yes, calling things biased and then being more content to dismiss them seems to be a symptom of having one's worldview challenged.

    Not saying this is what you are doing here, but maybe instead of "biased" you meant "opinionated"? To me, showing bias is tantamount to being guilty of having a provential worldview which negativity limits the scope of your analysis to those who already accept your priors.

    That's a lot different than making bold but true claims that are bolstered by facts and analysis (even subjective analysis), but it is convenient for those who don't agree to conflate the two situations, and dismiss plainly stated but solidly bolstered opinions with a "yeah, well, you know, that's just like, your opinion, man".

  20. #1420
    I believe he presented a fair amount of factual information with some expected editorializing for someone biased towards a universal basic wage.

  21. #1421
    Admiral of Awesome
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    Quote Originally Posted by Wookie06 View Post
    Look douche, are you saying that recognizing bias is the same as not being able to appreciate "the author's point"? It was an easy to read article where the author did not hide his bias and that's refreshing.
    Opinion and bias are not synonyms, especially when you're talking about journalism.

    To some degree each of those can be discussed but isn't the "public" sharing in the wealth when taxes are paid?
    No. Everybody pays taxes. Not everybody gets special treatment from the government.

    I'm actually against corporate taxes (and income and property to name a few) and I'm for tearing apart the current system.
    Preferential corporate taxation turns productive businesses into deferred income savings accounts for the super rich. It forces corporations to hoard cash they don't know how to spend because the money is literally worth more in their hands than it is in the shareholders'. Corporations should be taxed as though they were a single filer, and dividends should be tax-free.

    I would say it's the sort of behavior that must be changed. Corporations wouldn't have to resort to such maneuvering if it weren't for the tax code
    There will always be some necessary regulation preventing corporations from maximizing their profits, and corporations will always resort to some sort of maneuvering to try to get out from that law. Child labor, slavery, murder - there are very few crimes US corporations haven't committed, they just do it overseas where they are able to make it legal. (I assume I don't have to cite specific examples, but I can if you want.)

    and the federal government probably shouldn't be creating monstrous corporations.
    It's important to keep in mind how these monstrous corporations happen.

    IP companies, like film studios and software companies, are very nearly natural monopolies. All it takes to tip them over are patents and copyrights, which I think we can all agree are socially necessary under our current capitalist system. If you want to prevent these kinds of companies from becoming monopolies, you need to find some other way of fairly compensating inventors and creators for their efforts.

    Sometimes corporations are also given a regional monopoly as a reward for making some essential service available to everybody in that region, like utilities or healthcare. Microeconomics tells us that a competitive free market will only provide services to a profit-maximizing number of people. In the case of infrastructure, that means only the people who live in the highest density cities will receive service. If you want to prevent these kinds of companies from becoming monopolies, while still ensuring that people are able to buy the essential services they need to run their own businesses and households, you need to find some other way of distributing them.

    And some corporations are just ****. Some will do illegal or abusive things to drive their competitors out of the market. Things like using their wealth or social connections to deprive competitors of vital suppliers or distributors, using their stake in a media company to smear their competitors, filing nuisance lawsuits that smaller companies can't afford to defend against. Standard Oil did this kind of thing. So did Microsoft. If you want to prevent these kinds of corporations from becoming monopolies, you need to make this kind of behavior illegal, and you need to enforce those laws. The US has those laws but effectively doesn't enforce them anymore 1 2 3.

    However, even if you put all of that aside, Capitalism (the system, the model, the Marxist term, however you treat it) is based upon, and predicts, the ultimate accumulation and concentration of finite wealth. That means, when capitalism is left to its own devices, eventually all competitive markets cease to exist, and a handful of enormously powerful entities - people, or corporations - control functionally all productive capital in the world. This happens on its own! Only external (non-capitalist, or extra-economic) influences have the power to avert this doom.

    Certainly there's no real experience required for most basic education other than possibly having raised children
    Pedagogy is a skill and effectively performing that skill requires specific knowledge and training.

    but certainly once you get to higher levels actually having practiced what you teach is a strong positive. For example, I've never been employed as a welder but I can probably teach you how to weld. I won't be able to teach you very well though. I simply don't have a varied welding experience and neither you nor I will be a good welder or teacher until we have experience.
    I agree.

    Now when it comes to things like macro economics or climate science there probably isn't any actual work experience that's going to help in a field that's mostly theoretical.
    Professional economists are highly sought in finance and business. They are skilled data scientists and statisticians in their own right, with special expertise on developing predictive or explanatory models of human behavior. Even Valve Software, a video game company, is snapping up economists.

    "Climate science" is a uselessly vague term for this discussion, but people who work in the many fields that contribute to climate science can find practical employment in everything from meteorology to geophysical surveying. This work is so important for so many industries that "climate scientists" are among the most highly demanded professionals - especially by the oil and gas industries.

    If you're going to make fun of a field for being useless, the least you could do is learn enough about it to be right.

    I'm sure you are a much better teacher in subjects you have work experience in than before you had such experience.
    Domain experts make worse teachers because they tend to teach from abstraction, and do not remember or appreciate the cognitive challenges faced by beginners. Overcoming this tendency requires conscientiousness and pedagogical skill.

    When it comes to public service, too many times people that work in a field are forced to deal with people with little experience that enforce rules written by people with little experience and often rules are enforced punitively. The transportation industry comes to mind.
    In finance you have the opposite problem, where the SEC is largely staffed by experts drawn from the financial sector, who do favors for their old bosses. Perhaps the real question you ought to be asking is who benefits from punitive transportation laws enforced by unskilled workers.

    That's really the culmination of years of bad policy. For the genesis I think you have to go back to the late 90s.
    hahahaha, no.

    Of course but it's a basic example. There are corporations that run huge rental operations and that, to me, seems like economic rent.
    A portion of it will be economic rent, due to land scarcity. Another portion will be economic rent due to limited competition. Most of it, I suspect, is capital consumption and financial profit. TL;DR: Contract rent isn't the same thing as economic rent.

    Well, it's really hard to compete with free.
    YouTube isn't free, and other video hosts followed similar pricing models and failed. "Free" isn't what's hard to compete against - anticompetitive business deals are.

    I think this is interesting because why should they not be free to engage other entities that relate to its business? I know this recently came up when one of the cell phone providers had a deal that Netflix streaming would not take up monthly data. I don't know if that got shut down or not but it was said to be unfair. I would be pretty happy if all of the streaming services I use entered into an agreement with Verizon and if they all entered into agreements with someone else I'd just keep doing things the way I do on Verizon because, yes, that 1% difference in customer satisfaction does matter to me mister-used-to-be-verizon guy.
    Why shouldn't've Rockefeller been allowed to pay train companies to stop carrying his competitors' oil?

    Housing is a problem but I'm not sure it's mostly due to debt.
    Of course it is. I've read papers on this: house prices are totally explained by down payment size and amortization period. Conservative governments in the US, Canada, Australia, and UK all deregulated down payments and amortization periods at varying times and have seen their own housing bubbles inflate at corresponding times. It's not a coincidence.

    Let me give you an example. Say interest rates are 0%, and the median starter homebuyer has $10,000 in savings.

    If you are required to have a 100% down payment (mortgages are illegal), then the median starter home price will be $10,000, because that will be the most anybody can pay.

    If you are required to have a 50% down payment, then the median price will be $20,000.

    If you are required to have a 20% down payment, then the median price will be $50,000.

    If you are required to have a 5% down payment, then the median price will be $200,000.

    If you are required to have a 0% down payment, then the median price will be infinite. (And you probably live in Canada or Australia.)

    It's like magic!

    A lot of people blame speculation for the price increases, but speculation is also debt-fueled. Even foreign buyers (i.e. rich Chinese) are getting mortgages to finance their purchases, because they can't smuggle enough money out of China to buy houses outright.

    I'm not really arguing with you. I know you tend to discuss macro and I'm more grounded in micro. At some point in our society we probably will have to move more toward macro is micro, if that makes any sense.
    People who have studied economics are already aware that "macro is micro". Economic rents and monopolies are a microeconomics topic, including everything about it ^ upthread.

    What I think you mean to say is that you personally have a hard time thinking about effects in aggregate, where it's not immediately obvious to you how many small infractions can add up to a major negative effect over the whole world. This doesn't just include economics, it includes things like pollution and climate change.

    Quote Originally Posted by Wookie06 View Post
    Really, I'm just wondering when Trump is going to announce that Bill O'Reilly is his new press secretary.
    Overqualified.

    Quote Originally Posted by Obi_Kwiet View Post
    It seems to me that the main advantage of capitalism is that it assumes rent seeking behavior and tries to take advantage of that. Rent seeking is going to crop up no matter how you organize society. We don't necessarily do the greatest job at dealing with it, but fixing rent seeking is non-trivial. Almost by definition, the most powerful people in a society are going to be the ones who are the best at rent seeking. I'm not sure how you'd fix it outside of cultural values that strongly reject it.

    Complaining that people take advantage of the system is just stupid. Of course people take advantage of the system. The whole point of the system is to stop people from getting an unfair advantage. If people find loopholes, than the system isn't doing its job. We need to hold legislators to a higher standard. Passing populist legislation isn't the same as passing effective legislation. "More" regulation doesn't mean anything.
    I almost understand this post, but not quite?

  22. #1422
    Quote Originally Posted by Obi_Kwiet View Post
    Complaining that people take advantage of the system is just stupid. Of course people take advantage of the system. The whole point of the system is to stop people from getting an unfair advantage. If people find loopholes, than the system isn't doing its job. We need to hold legislators to a higher standard.
    Wait, what? If the whole point of "the system" is to stop people from getting an unfair advantage (which itself is a preposterous assertion, but let's put a pin in it), then of course people would be right to be be frustrated when the system fails to be fair. That would be "the system" failing to do what it is designed to do, and there would be no better reason to criticize it.

  23. #1423
    Admiral of Awesome
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    Quote Originally Posted by Eversor View Post
    Wait, what?
    ^

  24. #1424
    It's Stuart, Martha Stuart
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    Quote Originally Posted by Eversor View Post
    Wait, what? If the whole point of "the system" is to stop people from getting an unfair advantage (which itself is a preposterous assertion, but let's put a pin in it), then of course people would be right to be be frustrated when the system fails to be fair. That would be "the system" failing to do what it is designed to do, and there would be no better reason to criticize it.
    That's literally my point. Get angry at the people who make the system. Don't get angry at the people who optimize around it. People spend too much time coming about coporations, but tolerate incompetent politicians that offer knee jerk low effort solutions.

  25. #1425
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    Quote Originally Posted by Obi_Kwiet View Post
    That's literally my point. Get angry at the people who make the system. Don't get angry at the people who optimize around it. People spend too much time coming about coporations, but tolerate incompetent politicians that offer knee jerk low effort solutions.
    Let's rewind a bit to Econ 101. Do you remember the Three Basic Economic Questions?

    If you don't, they are as follows:

    • What to produce?
    • How to produce?
    • For whom to produce?


    You can essentially reduce any economic system to how it answers these three questions. For example, an agrarian collective might offer these answers:

    • Enough food and shelter to provide for everybody.
    • The combined efforts of all of the people.
    • Those with the greatest need.


    And Soviet-style central planning might offer these answers:

    • Whatever the communist party decides.
    • Whatever the communist party decides.
    • Whatever the communist party decides.


    I never said the answers had to be good. The point is, every economic system has to provide some answer, and that answer is what defines how the system behaves in an approximate sense.


    A free market offers these answers:

    • The amounts and types of good are determined by firms responding to public demand for goods: as the public becomes more interested in a certain good, they are willing to pay higher prices for a limited supply of that good. Firms compete to provide larger quantities of that good at lower prices. Thus, the economy produces the aggregate profit-maximizing amount of all goods.
    • Goods are produced by private firms. New firms seek profit by entering markets with insufficient supply or inefficient incumbents, and less efficient firms eventually go out of business. This cycle of startup and attrition means goods are, in the long run, produced by the firms which are capable of producing them most efficiently.
    • Firms compete to offer the best terms to the most efficient employees. Workers with the rarest and most valuable skills receive the best compensation. Goods are distributed to people who value them most, with a higher quantity allocated to the most valuable workers.


    These aren't just good answers, these are the best answers we've ever come up with. It's about as good as you're gonna get.

    If you haven't guessed already, the reason I brought this up is so we can talk about Capitalism. So... what about Capitalism? You probably think Capitalism is a free market, right? Most people do. Well, let's see:

    • The amounts and types of good are determined by firms responding to public demand for goods: as the public becomes more interested in a certain good, they are willing to pay higher prices for a limited supply of that good. Firms compete to provide larger quantities of that good at lower prices. Thus, the economy produces the aggregate profit-maximizing amount of all goods. (Oops. The whole point of Capitalism is the concentration of capital and the destruction of competitors. No competition helping to reset supply here! Economists call the difference between what a competitive free market would produce, and the amount a Capitalist oligopoly produces, a dead-weight loss.)
    • Goods are produced by private firms. New firms seek profit by entering markets (Oops. Capitalists use their wealth and influence to erect barriers to entry, like mandatory credentialing and franchise fees. Small enough that they don't bother established incumbents, but large enough that bootstrapping a business is unreasonable for most people.) with insufficient supply or inefficient incumbents, and less efficient firms eventually go out of business (Oops. Too big to fail! lol). This cycle of startup and attrition means goods are, in the long run, produced by the firms which are capable of producing them most efficiently. (Without the cycle of startup and attrition, goods are simply produced by the richest firm, regardless of how efficiently they do it.)
    • Firms compete to offer the best terms to the most efficient employees. (Under Capitalism, few labor markets are competitive. While there might be a variety of jobs in a region, they are too often for the same employer - for example, you might choose to work at a factory farm, or a slaughterhouse, or a packing plant, but all of these employers are owned by the same capitalists. Without competition, firms can offer essentially as little to workers as they're legally allowed.) Workers with the rarest and most valuable skills receive the best compensation. (Capitalists have been caught colluding to drive down the wages of skilled professionals. At the same time, the capitalists are paying themselves more and more, independent of their actual job performance.) Goods are distributed to people who value them most, with a higher quantity allocated to the most valuable workers. (Under the extreme wealth and income inequality of late-stage capitalism, all you can definitively say is that goods are distributed to the people who can afford them.)


    In other words, Capitalism is not a free market. It's a ****ing ****show, is what it is. Here's how Capitalism actually answers these questions in real life:

    • Capitalists make the profit-maximizing amount of each good. Since they do not face competition, the amount of each good they make is lower than it would be under a free market.
    • 80% of the goods in a sector are manufactured by the richest 1-2 capitalists. When they are threatened, the market leaders collude to drive prices below the marginal cost of production, killing off any firms which cannot weather prolonged periods of unprofitability. Once the threat has been eliminated, the market leaders collude to fix prices high again. Through this process, which economists call dumping, production of goods is concentrated among the wealthiest capitalists, and the wealth of poorer capitalists is transferred to them.
    • Since capitalists have a monopoly upon productive capital, they are allotted an out-sized portion of the goods produced (this is called an economic rent). This share of goods fuels dumping and competitor acquisition. Since 80% of workers are employed by the richest two firms in a sector, the market leaders also collude to ensure the rest of the workers are given as little as legally required.


    This is what Capitalism actually is. These are very bad answers to these questions. Please stop defending Capitalism. It's not a good system that's subverted by a few bad actors, it is a fundamentally and intentionally broken way of producing and allocating goods. The answer to capitalism / rent-seeking (they are the same thing) is to abolish capitalism / rent-seeking, not to try to fix it, not to punish the politicians who are complicit with rent seeking, or even to string up the executives who seek rent. Capitalism is garbage, it's a sinking ship, it's bad for literally everybody in the long run except (maybe) one dude in the very end.
    Last edited by Jon`C; 04-21-2017 at 01:35 AM.

  26. #1426
    except (maybe) one dude in the very end.
    And my name is Peter Thiel, TYVM.

    Competition is for losers, see y`all at my New Zealand bunker when I turn 150.

  27. #1427
    Admiral of Awesome
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    Quote Originally Posted by Reverend Jones View Post
    And my name is Peter Thiel, TYVM.

    Competition is for losers, see y`all at my New Zealand bunker when I turn 150.
    why dontcha found a company with a moat, and then drown yourself in it

  28. #1428
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    This was to Actual Peter Thiel, not to you. Unless you actually are Peter Thiel, in which case go **** yourself you literal vampire.

    Get a ****ing Stanford JD and then tell kids they don't need school, the **** do you know.

  29. #1429
    Quote Originally Posted by Obi_Kwiet View Post
    That's literally my point.
    Oh. You should've said your point, then!

  30. #1430
    It's Stuart, Martha Stuart
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    Quote Originally Posted by Jon`C View Post
    This is what Capitalism actually is. These are very bad answers to these questions. Please stop defending Capitalism. It's not a good system that's subverted by a few bad actors, it is a fundamentally and intentionally broken way of producing and allocating goods. The answer to capitalism / rent-seeking (they are the same thing) is to abolish capitalism / rent-seeking, not to try to fix it, not to punish the politicians who are complicit with rent seeking, or even to string up the executives who seek rent. Capitalism is garbage, it's a sinking ship, it's bad for literally everybody in the long run except (maybe) one dude in the very end.
    It seems to me that you are just using an redefinition of the term "capitalism" that's popular in a particular ideological group. You seem to paint capitalism as literally government collusion with special private interests to eliminate competition. The trouble is, I haven't seen any great argument that corruption and economic favoritism are unique and necessary consequences to private ownership of capital. What you are describing just seems to be one one specific case of the more general fact that unchecked corrupt power has a tenancy to grow through positive feedback. In capitalism that might manifest as wealthy groups using their wealth to influence the political process to allow them to rent-seek, further increasing their wealth and influence. But it's easy to both imagine and find examples of similar process occurring in other economic systems.

    Now, I see capitalism as tool that has to be wielded, not a perfectly optimal autonomous system. It's not going to be a perfect answer in every situation, and it may need some active adjustment especially in monopoly prone markets that have a high capital barrier to entry. I don't know how you are going to avoid a lot of these issue with market socialism though. As far as I can tell, there aren't any great systematic solutions to these problems, it's more a function of underlying cultural values.

  31. #1431
    Admiral of Awesome
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    Quote Originally Posted by Obi_Kwiet View Post
    It seems to me that you are just using an redefinition of the term "capitalism" that's popular in a particular ideological group.
    Capitalism is the private ownership of productive capital and the operation of capital for profit. Capitalism's main features are capital accumulation and concentration, competitive markets, and wage labor.

    If you believe my definition is insufficiently mainstream, please feel free to propose a different one.

    You seem to paint capitalism as literally government collusion with special private interests to eliminate competition.
    No, it's also industry collusion to eliminate competition. You forgot that part.

    Capital concentration means employment concentration. As more and more working citizens are employed by a single capitalist, that capitalist exerts a progressively larger influence over democratically elected officials. For example, elected officials will fear taking corrective action against the capitalist, because they risk losing the many votes of his employees, versus the small number of votes of acting against a capital-poor business. This is a sort of 'soft' corruption that happens even if the capitalist and official have no intention of directly collaborating, and it's why capitalism and democracy are fundamentally incompatible.

    The trouble is, I haven't seen any great argument that corruption and economic favoritism are unique
    The fact that other systems have problems is not an excuse to stick with an unusually terrible one.

    What you are describing just seems to be one one specific case of the more general fact that unchecked corrupt power has a tenancy to grow through positive feedback.
    Nevermind, I guess you did offer your own definition of capitalism.

    In capitalism that might manifest as wealthy groups using their wealth to influence the political process to allow them to rent-seek, further increasing their wealth and influence.
    This is capitalism.

    But it's easy to both imagine and find examples of similar process occurring in other economic systems.
    The fact that other systems have problems is not an excuse to stick with an unusually terrible one.

    Now, I see capitalism as tool that has to be wielded not a perfectly optimal autonomous system. It's not going to be a perfect answer in every situation, and it may need some active adjustment especially in monopoly prone markets that have a high capital barrier to entry.
    All markets are monopoly-prone in capitalism.

    I don't know how you are going to avoid a lot of these issue with market socialism though.
    Maybe the answer is a better mixed market with stronger capital controls, enforcing antitrust law to protect competition and not just to protect prices, socializing the risks of unemployment and small business foundation, and privatizing the risks of capital ownership??

    As far as I can tell, there aren't any great systematic solutions to these problems, it's more a function of underlying cultural values.
    Cultural values don't matter. Adultery is wrong, but people have affairs anyway. Corruption is wrong, but people still give bribes. Cultural values have never mattered, but especially won't when you have corporations and limited liability.
    Last edited by Jon`C; 04-21-2017 at 12:00 PM.

  32. #1432
    Wasn't "capitalism" a term coined by Marx? And somehow it is the capitalists who can't see the irony of using the term to glorify themselves.

    I could be totally wrong here.

  33. #1433
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    Quote Originally Posted by Reverend Jones View Post
    Wasn't "capitalism" a term coined by Marx? And somehow it is the capitalists who can't see the irony of using the term to glorify themselves.

    I could be totally wrong here.
    Basically yes. The word "capitalism" was coined by later Marxists, but Karl Marx defined it (as a market failure).

  34. #1434
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    The sad thing is how many people think capitalism just "happens", like it's the natural state of the world.

    Capitalism isn't ****ing natural. It started because of an accidental collision of technology, policy, and culture, the conditions for which don't even exist anymore. Fragile as spun glass, an Arabian race horse that takes constant feeding, grooming, and kind words, lest it instantly collapse and die. Sputtering and lurching from one catastrophe to the next. Not even 200 years old and already collapsing back into feudalism.

    If you want to end capitalism, all it takes is one thing from a huge list. Here are a few ideas. Take your pick! It doesn't matter which, capitalism can't survive any of them.

    - End compulsory labor (GMI)
    - Decrease capital liquidity (ban securitization)
    - Eliminate the competitive advantage of industrialization (Star Trek replicators)

    Kaboom, capitalism is over. What a robust system, so deserving of adoration.

  35. #1435
    Nobody is saying that liberty isn't fragile--far from it. The remarkable republic that was framed by conservatives such as Ben Franklin and Thomas Jefferson and enshrined in the holy constitution is under constant assault by socialists.

    If we don't remain vigilant and perennially refresh the tree of liberty by purchasing gold coins from talk radio ads, we risk a 1984 scenario and may soon find ourselves driving cars built by Government Motors. You can read the rest in Hayek's Road to Serfdom.
    Last edited by Reverend Jones; 04-21-2017 at 02:50 PM.

  36. #1436
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    Nothing is as liberating as being forced to enrich others by my labor at penalty of death.

  37. #1437
    To be fair, you were only threatened with death because you lacked the requisite protestant work ethic needed to qualify as a Real American.

    America was founded as a Christian nation. Either accept our compassion and repent, or go to Cuba.

  38. #1438
    And by going to "Cuba", I meant the deprivation of your Article One, Section 9 rights.

    Heil POTUS

  39. #1439
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    Is a man not entitled to the sweat of 5% more brows every year?

  40. #1440
    Only if he buys their sweat from his stock broker.

    On a serious note, you mentioned something about capitalists cornering the market from unfair advantage. What is your opinion of Vanguard, which now has 80% of the mutual fund market? Is this not simply an example of markets actually working, where the company with the most efficient operation (only 40 employees managing trillions of dollars) offering the best prices to its customers?

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