3 ms·

The giant pool of money is consumed by a desperate hunger for any shred of return it can find, and there is an almost limitless supply of smart, creative people

The giant pool of money is consumed by a desperate hunger for any shred of return it can find, and there is an almost limitless supply of smart, creative people who are well-positioned to capitalize on that. By contrast, there is a finite supply of regulators, and the people who make the laws that the regulators implement are themselves members of the cadre of hungry ghosts who make up the giant pool of money. With conditions like those, regulation will be doing extremely well to only be 10 or 20 steps behind the market.

toomuchtodo 6y ago
> and there is an almost limitless supply of smart, creative people who are well-positioned to capitalize on that. There are smart and creative people, but those are not the people being provided with capital to execute (see: WeWork, Uber, and most other VC unicorns burning out their runway). But, to your point, definitely right regulation needs to catch up. Fingers crossed it happens before the pitchforks come out [1]. Remember, those who hold vast amounts of the world's wealth are a vocal minority [2]. The same holds for the size of groups with exceedingly high wealth in developed countries [3]. [1] https://www.theatlantic.com/business/archive/2017/02/scheidel-great-leveler-inequality-violence/517164/ https://www.theatlantic.com/business/archive/2017/02/scheide... (The Only Thing, Historically, That's Curbed Inequality: Catastrophe) [2] https://www.vox.com/future-perfect/2019/1/22/18192774/oxfam-inequality-report-2019-davos-wealth https://www.vox.com/future-perfect/2019/1/22/18192774/oxfam-... ("42 million people, or 0.8 percent of the world’s population, have net worths in excess of $1 million. That group — roughly the global 1 percent — controls 44.8 percent of the world’s wealth. So it really is true that a pretty small number of people control nearly half the world’s wealth. It’s just a bigger small number of people than Oxfam’s reports tend to emphasize.") [3] https://en.wikipedia.org/wiki/List_of_Americans_by_net_worth https://en.wikipedia.org/wiki/List_of_Americans_by_net_worth (The Forbes 400 Richest Americans list has been published annually since 1982. The combined net worth of the 2019 class of the 400 richest Americans was $2.9 trillion, up from $2.7 trillion in 2017. As of October 2019, there were 621 billionaires--a record high--in the United States.)
adventured 6y ago
> The giant pool of money is consumed by a desperate hunger for any shred of return it can find, and there is an almost limitless supply of smart, creative people who are well-positioned to capitalize on that. The finite regulators are confronted with a very small supply of smart, creative people in a position to capitalize. That group is the opposite of almost limitless, it's scarce. Why can't regulators easily handle the dozens of deals per year that are of particular significance in VC-money terms? Nothing drastic needs to be done to regulate that scale of deals better, it's not that large in quantity. We're not talking about tens of thousands of very large funding rounds per year, that isn't going to happen.
- mumblemumble 6y ago
  In a nutshell, because the USA is a capitalist society that's governed by rule of law. So regulators don't get broad power to approve or deny any business deal based on ad-hoc decisions about whether they think the deal will ultimately be a net positive for the economy 10 years down the line. They get much narrower powers to protect against a specific set of things as laid out in whatever laws comprise their job description. And Congress doesn't usually get involved until after there's already a big smoking crater surrounded by a bunch of upset people. And don't think that the supply of "smart, creative people in a position to capitalize" is limited to the CEOs of unicorns or anything like that. The supply is actually the total number of entrepreneurial-minded people with an idea and a desire for some capital to help get it off the ground. And the scope of ideas is not limited to silicon valley startups. I'm talking about people the pool of money could throw its funds at, not the (much smaller) set of people it has thrown its funds at in the past, or the (even smaller) set of those people who get bashed in the news.

toomuchtodo 6y ago

> and there is an almost limitless supply of smart, creative people who are well-positioned to capitalize on that. There are smart and creative people, but those are not the people being provided with capital to execute (see: WeWork, Uber, and most other VC unicorns burning out their runway). But, to your point, definitely right regulation needs to catch up. Fingers crossed it happens before the pitchforks come out [1]. Remember, those who hold vast amounts of the world's wealth are a vocal minority [2]. The same holds for the size of groups with exceedingly high wealth in developed countries [3]. [1] https://www.theatlantic.com/business/archive/2017/02/scheidel-great-leveler-inequality-violence/517164/ https://www.theatlantic.com/business/archive/2017/02/scheide... (The Only Thing, Historically, That's Curbed Inequality: Catastrophe) [2] https://www.vox.com/future-perfect/2019/1/22/18192774/oxfam-inequality-report-2019-davos-wealth https://www.vox.com/future-perfect/2019/1/22/18192774/oxfam-... ("42 million people, or 0.8 percent of the world’s population, have net worths in excess of $1 million. That group — roughly the global 1 percent — controls 44.8 percent of the world’s wealth. So it really is true that a pretty small number of people control nearly half the world’s wealth. It’s just a bigger small number of people than Oxfam’s reports tend to emphasize.") [3] https://en.wikipedia.org/wiki/List_of_Americans_by_net_worth https://en.wikipedia.org/wiki/List_of_Americans_by_net_worth (The Forbes 400 Richest Americans list has been published annually since 1982. The combined net worth of the 2019 class of the 400 richest Americans was $2.9 trillion, up from $2.7 trillion in 2017. As of October 2019, there were 621 billionaires--a record high--in the United States.)

adventured 6y ago

> The giant pool of money is consumed by a desperate hunger for any shred of return it can find, and there is an almost limitless supply of smart, creative people who are well-positioned to capitalize on that. The finite regulators are confronted with a very small supply of smart, creative people in a position to capitalize. That group is the opposite of almost limitless, it's scarce. Why can't regulators easily handle the dozens of deals per year that are of particular significance in VC-money terms? Nothing drastic needs to be done to regulate that scale of deals better, it's not that large in quantity. We're not talking about tens of thousands of very large funding rounds per year, that isn't going to happen.

mumblemumble 6y ago
In a nutshell, because the USA is a capitalist society that's governed by rule of law. So regulators don't get broad power to approve or deny any business deal based on ad-hoc decisions about whether they think the deal will ultimately be a net positive for the economy 10 years down the line. They get much narrower powers to protect against a specific set of things as laid out in whatever laws comprise their job description. And Congress doesn't usually get involved until after there's already a big smoking crater surrounded by a bunch of upset people. And don't think that the supply of "smart, creative people in a position to capitalize" is limited to the CEOs of unicorns or anything like that. The supply is actually the total number of entrepreneurial-minded people with an idea and a desire for some capital to help get it off the ground. And the scope of ideas is not limited to silicon valley startups. I'm talking about people the pool of money could throw its funds at, not the (much smaller) set of people it has thrown its funds at in the past, or the (even smaller) set of those people who get bashed in the news.