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>At some point the truth will come out I don't agree. >Without risk, there is no chance of reward I also don't agree with this. What you're saying is that we

by yterdy 3y ago

>At some point the truth will come out I don't agree. >Without risk, there is no chance of reward I also don't agree with this. What you're saying is that we have a mechanism to prevent people from scamming each other, but you'd rather not implement it because you see yourself as more capable of profiting off the scam arbitrage. I think that's kind of sick. Companies aren't people, there's no natural expectation of privacy rights. As with software, a society where the books are open is more secure and more able to capitalize on that security.

zie 3y ago
When the asset changes hands, it is sold and the then current market price is known. For real estate, the market price is disclosed publicly. For other assets the price may or may not be disclosed, but it is known by both parties and probably by most people wanting to know that pay attention. This is what I meant by the truth will come out. Let's say your parents, with whom you have a great relationship, are selling their house to downsize and you want to buy it. How tempted are you to get an independent house inspector to audit the house and make sure it's still standing and that you can trust your parents that the house is as the say it is? Essentially zero percent. Meanwhile there is your druggie cousin's dealer who has a house they are wanting to sell and you want to buy it. How tempted are you to get an audit done on THAT house? basically 100%? We already DO implement the mechanism to avoid scamming people, TRUST. If you have it with someone, you are much more likely to not require an audit, the less you trust that person, the more likely you are to want an audit. > What you're saying is that we have a mechanism to prevent people from scamming each other, but you'd rather not implement it because you see yourself as more capable of profiting off the scam arbitrage. No, I'm talking about the basics of economics in our system. If you invest in US treasuries, they are very boring, guaranteed by the biggest government on the planet and very very safe. They also pay next to nothing in real(inflation adjusted) terms. If you invest in companies(aka stocks), then there is real economic risk, but the returns are ridiculously more than the boring, safe US treasuries. Same with your employment. You can go get a boring govt or academic job and be very safe @ work or you can go choose a very risky, but lucrative job that pays a lot. Everyone is free to choose their risk adjusted returns as they personally see fit for their levels of risk tolerance. The more risky will try to make it big and be the next Musk, Bezos, Gates, etc. The less risky will work at the local DMV or school. > Companies aren't people, there's no natural expectation of privacy rights. As with software, a society where the books are open is more secure and more able to capitalize on that security. I agree with this, but that's not related to this discussion at all. Personally I think companies should always have open books. That doesn't change that company X thinks the asset is worth $X and Company Y thinks the asset is worth $Y. They can either not do business or hire an independent auditor. Forcing an independent auditor into every asset valuation is just adding extra bureaucracy that isn't needed.
- yterdy 3y ago
  Oh, boy, here we go. Your word-wall-no-jutsu is strong. I shall respond to certain statements as I see fit, because bless you that's why. >When the asset changes hands, it is sold and the then current market price is known. Volume is down in many asset classes and the "distressed property" pricing is not being allowed to affect like appraisals in areas like commercil real estate. So, the truth actually isn't coming out, as a matter of practicality. >We already DO implement the mechanism to avoid scamming people, TRUST. This is a terrible mechanism absolutely ripe for corruption, which brings us to... >You can go get a boring govt or academic job and be very safe @ work or you can go choose a very risky, but lucrative job that pays a lot. Unless you leverage your public or bureaucratic position for personal gain, like trading securities on insider information or using your expertise to either gain a lucrative private position after reaitgning or gaining a public position where you can steer policy towards your interests. But that never happens in America. >No, I'm talking about the basics of economics in our system. Right, scams. Profit is taken off the arbitrage of information asymmetry that, in a better system, would not exist (at least so egregiously). Your "trust" is lipstick-pigging the inherent scamminess of free enterprise as it exists in our society. >I agree with this, but that's not related to this discussion at all. It's actually the central issue. People are making poor decisions based on their poor access to information. Consensus is deterministic when the information under consideration is equal. What I'll give is that, practically-speaking, that equality is impossible, but it's much easier to approach when one party isn't allowed to hide a massive component of their valuation. Again, I've yet to see you explain how this auditing process would be more expensive to society than arbitrage-bred profits that are then gambled away in bad market bets and economic crises. What you're running up against is the fact that capital accrual is more expensive to society than distribution to pay for basic goods and services. Hoarding money is more expensive than just using it. Sorry.
  - zie 3y ago
    So if I understand your position, you want information to always be free in every transaction, so when you go to the store to buy a pack of gum, you can look up the entire supply chain, figure out the entire cost for that gum and come to a reasonable price between the buyer and seller? We would have independent auditors that verify the supply chain information is accurate, adding lots of extra cost for these auditors. How are they paid? How do we keep the auditors honest? What if they are incentivized in some way to not be completely truthful in their auditing? How many people do you think will be willing to do that? I'd bet the amount of people willing to do that is effectively zero. Especially over a pack of gum.

by yterdy 3y ago

zie 3y ago

When the asset changes hands, it is sold and the then current market price is known. For real estate, the market price is disclosed publicly. For other assets the price may or may not be disclosed, but it is known by both parties and probably by most people wanting to know that pay attention. This is what I meant by the truth will come out. Let's say your parents, with whom you have a great relationship, are selling their house to downsize and you want to buy it. How tempted are you to get an independent house inspector to audit the house and make sure it's still standing and that you can trust your parents that the house is as the say it is? Essentially zero percent. Meanwhile there is your druggie cousin's dealer who has a house they are wanting to sell and you want to buy it. How tempted are you to get an audit done on THAT house? basically 100%? We already DO implement the mechanism to avoid scamming people, TRUST. If you have it with someone, you are much more likely to not require an audit, the less you trust that person, the more likely you are to want an audit. > What you're saying is that we have a mechanism to prevent people from scamming each other, but you'd rather not implement it because you see yourself as more capable of profiting off the scam arbitrage. No, I'm talking about the basics of economics in our system. If you invest in US treasuries, they are very boring, guaranteed by the biggest government on the planet and very very safe. They also pay next to nothing in real(inflation adjusted) terms. If you invest in companies(aka stocks), then there is real economic risk, but the returns are ridiculously more than the boring, safe US treasuries. Same with your employment. You can go get a boring govt or academic job and be very safe @ work or you can go choose a very risky, but lucrative job that pays a lot. Everyone is free to choose their risk adjusted returns as they personally see fit for their levels of risk tolerance. The more risky will try to make it big and be the next Musk, Bezos, Gates, etc. The less risky will work at the local DMV or school. > Companies aren't people, there's no natural expectation of privacy rights. As with software, a society where the books are open is more secure and more able to capitalize on that security. I agree with this, but that's not related to this discussion at all. Personally I think companies should always have open books. That doesn't change that company X thinks the asset is worth $X and Company Y thinks the asset is worth $Y. They can either not do business or hire an independent auditor. Forcing an independent auditor into every asset valuation is just adding extra bureaucracy that isn't needed.

yterdy 3y ago
Oh, boy, here we go. Your word-wall-no-jutsu is strong. I shall respond to certain statements as I see fit, because bless you that's why. >When the asset changes hands, it is sold and the then current market price is known. Volume is down in many asset classes and the "distressed property" pricing is not being allowed to affect like appraisals in areas like commercil real estate. So, the truth actually isn't coming out, as a matter of practicality. >We already DO implement the mechanism to avoid scamming people, TRUST. This is a terrible mechanism absolutely ripe for corruption, which brings us to... >You can go get a boring govt or academic job and be very safe @ work or you can go choose a very risky, but lucrative job that pays a lot. Unless you leverage your public or bureaucratic position for personal gain, like trading securities on insider information or using your expertise to either gain a lucrative private position after reaitgning or gaining a public position where you can steer policy towards your interests. But that never happens in America. >No, I'm talking about the basics of economics in our system. Right, scams. Profit is taken off the arbitrage of information asymmetry that, in a better system, would not exist (at least so egregiously). Your "trust" is lipstick-pigging the inherent scamminess of free enterprise as it exists in our society. >I agree with this, but that's not related to this discussion at all. It's actually the central issue. People are making poor decisions based on their poor access to information. Consensus is deterministic when the information under consideration is equal. What I'll give is that, practically-speaking, that equality is impossible, but it's much easier to approach when one party isn't allowed to hide a massive component of their valuation. Again, I've yet to see you explain how this auditing process would be more expensive to society than arbitrage-bred profits that are then gambled away in bad market bets and economic crises. What you're running up against is the fact that capital accrual is more expensive to society than distribution to pay for basic goods and services. Hoarding money is more expensive than just using it. Sorry.
- zie 3y ago
  So if I understand your position, you want information to always be free in every transaction, so when you go to the store to buy a pack of gum, you can look up the entire supply chain, figure out the entire cost for that gum and come to a reasonable price between the buyer and seller? We would have independent auditors that verify the supply chain information is accurate, adding lots of extra cost for these auditors. How are they paid? How do we keep the auditors honest? What if they are incentivized in some way to not be completely truthful in their auditing? How many people do you think will be willing to do that? I'd bet the amount of people willing to do that is effectively zero. Especially over a pack of gum.