Dec 31, 2019, 4:52 PM —“Between the US, the EU, Russia, and China, what do you think is the most capitalist society?”— The Capitalism vs Communism dichotomy is a fabrication of the Marxists to distract from the reality that: (a) all states must practice mixed economies, with state centralization solving market limitations at the cost of poor capital efficiency and high corruption, until private capital can decentralize production and increase capital efficiency and decrease corruption; Advanced economies must innovate and require markets (private sector) majority production, and backward economies must catch up and create markets by state (public sector) majority production. (b) all states capable of collecting revenues either by investment and returns, taxation, interest collection, profiting from direct management, or all of the above, can choose whether to spend the income on consumption (redistribution) or production( further investment). Those states that are unable to collect revenues can militarize the population (as did the soviets) and minimize wages so that the maximum resources can be directed to production of commons. (c) the question is whether one operates by rule of law that naturally produces markets, rule by legislation negotiated between classes, or rule by regulation by monopoly bureaucracy, or rule by command (discretion) by dictator. ANGLOSPHERE countries are by far – without even a close competitor – dependent upon rule of law, rule by legislation, and state funding basic research, but almost no state involvement in production – why? Because judges were always independent professionals and less subject to corruption. Mixed Economy, Favoring Private Sector, and Rule of Law. CONTINENTAL – countries practice the napoleonic law of rule by legislation and rule by regulation. Why? Because french judges were appointed or purchased their positions and napoleon could not trust them to refrain from discretionary rulings (making up law). Mixed Economy, Favoring mixed public private sectors, and Rule of Legislation. POST SOVIET – Countries are cripple by soviet legal codes, but while russia and ukraine have reformed their laws (ukrainian law is quite good really), the problem in both countries has been reducing corruption that was endemic under the soviets in all walks of life. Although we must compliment Putin on tripling the number of cases in in the courts, even if he has not succeeded in preventing coercive thefts of businesses by state members (I could not find a single company to buy in Moscow because they must keep ‘fake’ books in order to prevent people in the government from conspiring to take over the business by confiscatory corruption.) Mixed economy, Both Heavy public and Private sectors, and rule by legislation and rule by Regulation INDIA. Indian law is fine. Like everything else in india, the engine of indian order is not the government but culture, tradition, and the family. Russia crosses eleven time zones but it’s still a country. America is an empire and each state or region a different country. Europe is trying and failing to repeat the american experiment and failing at the same time america is failing. India likewise is a continent and an empire not a country. India is unable to devote sufficient resources (for reasons we do not understand) to either providing speedy (timely) justice, or to producing sufficient infrastructure, given her people’s rates of reproduction. India lacks china’s authoritarianism and remains familialism which is both beautiful on the one hand but slows her rate of adaptation. Long term india will do wonderfully. Mixed Economy, Favoring Private Sector, Rule by Legislation CHINA has never practiced any semblance of law in the western sense, and instead has practiced arbitrary rule: Rule by Command, and Rule by Regulation and this seems to be the preference of the chinese people. China was a very poor (still is) backward country having made the mistake to reject modernity, then to embrace communism in order to prevent the south from seceding, leaving beijing in the north to rule poverty, and the commercial south to separate and join modernity. Mao would not tolerate this. After the failure of communism China saw the failure of the Soviets, and then the american defeat of the Iraqis, and this combination created today’s Chinese strategy of restoring her traditional position as the central power in east asia – despite all her neighbors fearing that china will also return to violence. Unlike india, china has a long history of monopoly authoritarian rule, and even more so, has the power of the Red Army (which really governs china’s factions). The chinese have a long history of pragmatism and reason – and almost no sense of the value of human life, and nothing approaching indian or european ethics. Secondly the chinese people are rather industrious and hard-working. So between authoritarian hierarchy, a means of enforcing political will with the army, a literate and intelligent hard working workforce, an endless supply of cheap labor, and endless debt capacity, and willingness to have an economic crash, china has been able to maximize state investment, migration of people into the workforce, and expansion of the military, and then to clamp down in response to an end to the boom. There is no question that for china, this is the optimum method of ‘catching up from behind’. Mixed Economy, Heavily Favoring State Sector, Rule by Command The most capitalist countries are those with the most rule of law and the most private sector. (anglosphere) The Most** mixed economies** are those with rule of legislation, a mix of private and state sector, (continental) The most **command economies **are those with the least rule of law and the most state sector (china) China has more successfully used debt capacity than any country in the world. This does not mean it is capitalist, since capitalism means bias to the private sector and minimizing the state sector.
Theme: Institution
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What Do You Think Is the Most Capitalist Society
Dec 31, 2019, 4:52 PM —“Between the US, the EU, Russia, and China, what do you think is the most capitalist society?”— The Capitalism vs Communism dichotomy is a fabrication of the Marxists to distract from the reality that: (a) all states must practice mixed economies, with state centralization solving market limitations at the cost of poor capital efficiency and high corruption, until private capital can decentralize production and increase capital efficiency and decrease corruption; Advanced economies must innovate and require markets (private sector) majority production, and backward economies must catch up and create markets by state (public sector) majority production. (b) all states capable of collecting revenues either by investment and returns, taxation, interest collection, profiting from direct management, or all of the above, can choose whether to spend the income on consumption (redistribution) or production( further investment). Those states that are unable to collect revenues can militarize the population (as did the soviets) and minimize wages so that the maximum resources can be directed to production of commons. (c) the question is whether one operates by rule of law that naturally produces markets, rule by legislation negotiated between classes, or rule by regulation by monopoly bureaucracy, or rule by command (discretion) by dictator. ANGLOSPHERE countries are by far – without even a close competitor – dependent upon rule of law, rule by legislation, and state funding basic research, but almost no state involvement in production – why? Because judges were always independent professionals and less subject to corruption. Mixed Economy, Favoring Private Sector, and Rule of Law. CONTINENTAL – countries practice the napoleonic law of rule by legislation and rule by regulation. Why? Because french judges were appointed or purchased their positions and napoleon could not trust them to refrain from discretionary rulings (making up law). Mixed Economy, Favoring mixed public private sectors, and Rule of Legislation. POST SOVIET – Countries are cripple by soviet legal codes, but while russia and ukraine have reformed their laws (ukrainian law is quite good really), the problem in both countries has been reducing corruption that was endemic under the soviets in all walks of life. Although we must compliment Putin on tripling the number of cases in in the courts, even if he has not succeeded in preventing coercive thefts of businesses by state members (I could not find a single company to buy in Moscow because they must keep ‘fake’ books in order to prevent people in the government from conspiring to take over the business by confiscatory corruption.) Mixed economy, Both Heavy public and Private sectors, and rule by legislation and rule by Regulation INDIA. Indian law is fine. Like everything else in india, the engine of indian order is not the government but culture, tradition, and the family. Russia crosses eleven time zones but it’s still a country. America is an empire and each state or region a different country. Europe is trying and failing to repeat the american experiment and failing at the same time america is failing. India likewise is a continent and an empire not a country. India is unable to devote sufficient resources (for reasons we do not understand) to either providing speedy (timely) justice, or to producing sufficient infrastructure, given her people’s rates of reproduction. India lacks china’s authoritarianism and remains familialism which is both beautiful on the one hand but slows her rate of adaptation. Long term india will do wonderfully. Mixed Economy, Favoring Private Sector, Rule by Legislation CHINA has never practiced any semblance of law in the western sense, and instead has practiced arbitrary rule: Rule by Command, and Rule by Regulation and this seems to be the preference of the chinese people. China was a very poor (still is) backward country having made the mistake to reject modernity, then to embrace communism in order to prevent the south from seceding, leaving beijing in the north to rule poverty, and the commercial south to separate and join modernity. Mao would not tolerate this. After the failure of communism China saw the failure of the Soviets, and then the american defeat of the Iraqis, and this combination created today’s Chinese strategy of restoring her traditional position as the central power in east asia – despite all her neighbors fearing that china will also return to violence. Unlike india, china has a long history of monopoly authoritarian rule, and even more so, has the power of the Red Army (which really governs china’s factions). The chinese have a long history of pragmatism and reason – and almost no sense of the value of human life, and nothing approaching indian or european ethics. Secondly the chinese people are rather industrious and hard-working. So between authoritarian hierarchy, a means of enforcing political will with the army, a literate and intelligent hard working workforce, an endless supply of cheap labor, and endless debt capacity, and willingness to have an economic crash, china has been able to maximize state investment, migration of people into the workforce, and expansion of the military, and then to clamp down in response to an end to the boom. There is no question that for china, this is the optimum method of ‘catching up from behind’. Mixed Economy, Heavily Favoring State Sector, Rule by Command The most capitalist countries are those with the most rule of law and the most private sector. (anglosphere) The Most** mixed economies** are those with rule of legislation, a mix of private and state sector, (continental) The most **command economies **are those with the least rule of law and the most state sector (china) China has more successfully used debt capacity than any country in the world. This does not mean it is capitalist, since capitalism means bias to the private sector and minimizing the state sector.
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Notes on Corp Ownership Reform
Notes on Corp Ownership Reform https://propertarianism.com/2020/05/27/notes-on-corp-ownership-reform/
Source date (UTC): 2020-05-27 00:57:28 UTC
Original post: https://twitter.com/i/web/status/1265446992219484160
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Notes on Corp Ownership Reform
Jan 1, 2020, 8:47 PM Legal PerspectiveTrue: “The purpose of the corporation is to do anything lawful.” And “Corporations are real, shareholders are a fiction.” In other words, shareholders are not owners. Companies do not work to maximize shareholder value. That is a fiction to sell investors. A management team balances brand awareness, market share, customers, employees, bankers, investors, and vendors, each of which is competing to maximize their take of the profits if their are any. Thoughts:
(a) Owners ‘invest’ to obtain income and appreciation but lack liquidity.
(b) Shareholders function as lenders who purchase liquidity and opportunity for dividends and appreciation – they are not owners, that is the myth.
(c) From the company’s perspective, dividends and appreciation are the cost of maintaining borrowing capacity in capital markets so that opportunities can be seized by rapid appeal to capital markets.
(d) Boards of other than owners are a wast of time money and energy – a kabuki theater – and instead, companies should be, and are, insured to act in the interest of their contract with the shareholders. The very best you can say about boards is (i) you can pay people for relationships, assistance, and information. (ii) when you are unsure and want to bounce ideas off peers rather than employees but be sure it won’t leak, they’re useful. (iii) preparing for board meetings makes sure that you and your team are on the same page and understand your own business. (iv) I use my boards exclusively to test my ideas and rarely do anything if I can’t convince them unanimously. This tempers my too-high risk tolerance. It gives me political cover with the staff and others if I make a mistake.
(e) It’s not even clear that financial reports other than to auditors and insurers are of any value other than in selling to lenders (shareholders). Randomly select financial reports from your favorite companies. You will learn far more from analyst calls.
(f) Trying to maintain or improve shareholder value, is a terrible practice because investment cycles (capital requirements necessary for returns) have been increasing, and the division of production distribution and trade fragmenting, but lifespan of companies are decreasing – for this very reason. Innovators dilemmas everywhere. No one tries to maximize shareholder value. That’s nonsense. You try to preserve it. the objective of nearly every business is to preserve it’s existence as a going concern for all those involved: customers, employees, owners, vendors, investors. It is very hard to build a business that produces a durable income stream because the customer vendor employee network is the most difficult organization to produce.
(g) There is no reason whatsoever that companies should direct resources to ‘charities’ or ‘movements’, instead of requiring such donations come from individuals. Social responsibly is a code word for rent-seeking because the government is incapable of providing results. The current condition is that companies are frequently blackmailed if they don’t contribute to certain causes. That’s an injustice. That one shall do no harm is the best an organization can do and is the best therefore we can ask them to do. Lastly unless you’ve run a company of at least say, 50M, and preferably over 100M you have no idea just how difficult it is to produce a profit. (i) My primary complaint is that companies do not themselves maintain accounting for operations (cash: profit and loss from operations), management (ops plus overhead), owners (ops, overhead, assets, and yes, market share ), lenders (EBITDA), and the state (taxes, amortization, and depreciation). Most executives I’ve consulted, companies I’ve acquired, or accounting departments I’ve fought with, have too poor a grasp of operations and obscure it by conflating accounting data so to obscure normal volatility and variation in risk from investors and lenders, and to minimize taxes. Drive employee quality, operations, marketshare, and leave everything else to finance and accounting. Money is just another resource provided by vendors.
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Notes on Corp Ownership Reform
Jan 1, 2020, 8:47 PM Legal PerspectiveTrue: “The purpose of the corporation is to do anything lawful.” And “Corporations are real, shareholders are a fiction.” In other words, shareholders are not owners. Companies do not work to maximize shareholder value. That is a fiction to sell investors. A management team balances brand awareness, market share, customers, employees, bankers, investors, and vendors, each of which is competing to maximize their take of the profits if their are any. Thoughts:
(a) Owners ‘invest’ to obtain income and appreciation but lack liquidity.
(b) Shareholders function as lenders who purchase liquidity and opportunity for dividends and appreciation – they are not owners, that is the myth.
(c) From the company’s perspective, dividends and appreciation are the cost of maintaining borrowing capacity in capital markets so that opportunities can be seized by rapid appeal to capital markets.
(d) Boards of other than owners are a wast of time money and energy – a kabuki theater – and instead, companies should be, and are, insured to act in the interest of their contract with the shareholders. The very best you can say about boards is (i) you can pay people for relationships, assistance, and information. (ii) when you are unsure and want to bounce ideas off peers rather than employees but be sure it won’t leak, they’re useful. (iii) preparing for board meetings makes sure that you and your team are on the same page and understand your own business. (iv) I use my boards exclusively to test my ideas and rarely do anything if I can’t convince them unanimously. This tempers my too-high risk tolerance. It gives me political cover with the staff and others if I make a mistake.
(e) It’s not even clear that financial reports other than to auditors and insurers are of any value other than in selling to lenders (shareholders). Randomly select financial reports from your favorite companies. You will learn far more from analyst calls.
(f) Trying to maintain or improve shareholder value, is a terrible practice because investment cycles (capital requirements necessary for returns) have been increasing, and the division of production distribution and trade fragmenting, but lifespan of companies are decreasing – for this very reason. Innovators dilemmas everywhere. No one tries to maximize shareholder value. That’s nonsense. You try to preserve it. the objective of nearly every business is to preserve it’s existence as a going concern for all those involved: customers, employees, owners, vendors, investors. It is very hard to build a business that produces a durable income stream because the customer vendor employee network is the most difficult organization to produce.
(g) There is no reason whatsoever that companies should direct resources to ‘charities’ or ‘movements’, instead of requiring such donations come from individuals. Social responsibly is a code word for rent-seeking because the government is incapable of providing results. The current condition is that companies are frequently blackmailed if they don’t contribute to certain causes. That’s an injustice. That one shall do no harm is the best an organization can do and is the best therefore we can ask them to do. Lastly unless you’ve run a company of at least say, 50M, and preferably over 100M you have no idea just how difficult it is to produce a profit. (i) My primary complaint is that companies do not themselves maintain accounting for operations (cash: profit and loss from operations), management (ops plus overhead), owners (ops, overhead, assets, and yes, market share ), lenders (EBITDA), and the state (taxes, amortization, and depreciation). Most executives I’ve consulted, companies I’ve acquired, or accounting departments I’ve fought with, have too poor a grasp of operations and obscure it by conflating accounting data so to obscure normal volatility and variation in risk from investors and lenders, and to minimize taxes. Drive employee quality, operations, marketshare, and leave everything else to finance and accounting. Money is just another resource provided by vendors.
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The Cult of Competence
Jan 5, 2020, 2:40 PM by Luke Weinhagen
—“… the freedom we have enjoyed in America is not the fruit of fortuitous accident, of great natural resources, or of mere isolation from the tangled skein of European politics. It is the direct result of purposeful thinking and hard work. It is the child of the cult of competency—intellectual competency, physical competency, moral competency…”—
Source ( http://ergo-sum.net/literature/CultOfCompetency.pdf) The address the above excerpt is pulled from has become something of an inspiration for me in defining and pursuit of a cult of competence. The problems we are working to provide solutions for now have been plaguing man for at least as long as we’ve been writing it story down. The cult of competence has always been there in some form wherever dangerous free individuals pursue fruitful and virtuous interaction with other dangerous free individuals.
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The Cult of Competence
Jan 5, 2020, 2:40 PM by Luke Weinhagen
—“… the freedom we have enjoyed in America is not the fruit of fortuitous accident, of great natural resources, or of mere isolation from the tangled skein of European politics. It is the direct result of purposeful thinking and hard work. It is the child of the cult of competency—intellectual competency, physical competency, moral competency…”—
Source ( http://ergo-sum.net/literature/CultOfCompetency.pdf) The address the above excerpt is pulled from has become something of an inspiration for me in defining and pursuit of a cult of competence. The problems we are working to provide solutions for now have been plaguing man for at least as long as we’ve been writing it story down. The cult of competence has always been there in some form wherever dangerous free individuals pursue fruitful and virtuous interaction with other dangerous free individuals.
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Differences in Standards
Jan 5, 2020, 2:53 PM by Vengefül Bobmoran High trust people require not only the absence of conflict of interest, but also the absence of appearance of conflict of interest, as the appearance itself is enough to erode trust and imposes a huge cost on everyone. The left applies the bare minimum ghetto ethic (no provable conflict of interest – cheap, easy deniability and pilpul) to its own, but will gladly apply our standards (no appearance of conflict of interest – expensive compliance) to us. They don’t even care about maintaining trust; they just intuit the huge costs of adherence to our standards and attack us with it, in the same way that they use the judicial process itself, rather than the judgement, as a weapon. This also explains how they can suddenly be more Catholic than the Pope when criticizing us: it’s all about maximizing the costs (damages) they can impose.
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Differences in Standards
Jan 5, 2020, 2:53 PM by Vengefül Bobmoran High trust people require not only the absence of conflict of interest, but also the absence of appearance of conflict of interest, as the appearance itself is enough to erode trust and imposes a huge cost on everyone. The left applies the bare minimum ghetto ethic (no provable conflict of interest – cheap, easy deniability and pilpul) to its own, but will gladly apply our standards (no appearance of conflict of interest – expensive compliance) to us. They don’t even care about maintaining trust; they just intuit the huge costs of adherence to our standards and attack us with it, in the same way that they use the judicial process itself, rather than the judgement, as a weapon. This also explains how they can suddenly be more Catholic than the Pope when criticizing us: it’s all about maximizing the costs (damages) they can impose.
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Why Are Contracts a Mess?
Why Are Contracts a Mess? https://propertarianism.com/2020/05/26/why-are-contracts-a-mess/
Source date (UTC): 2020-05-26 21:08:58 UTC
Original post: https://twitter.com/i/web/status/1265389487330336769