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First off, you've got a great point here, and I agree with just about all of it. But I do take exception to one point: > (in some respects [markets resemble]

by dstorrs 17y ago

First off, you've got a great point here, and I agree with just about all of it. But I do take exception to one point: > (in some respects [markets resemble] biological evolution, only less stupid and short-sighted) LESS short-sighted? When all of our markets are optimizing for 6- or even 3-month returns? When companies are structured in long-term suboptimal ways because you need to maximize profits for the short term to keep investors happy, or the people at the top get fired. cf the infamous quote from Citibank's former CEO, Chuck Prince: "While the music's playing, you've gotta dance." [This said in answer to being asked why he continued his investment strategy despite knowing it to be unsound.]

camccann 17y ago
LESS short-sighted? Quite so! I fear you overestimate biological evolution. Imagine a market with the same kind of behaviors you describe, only a million times larger, and where not only do markets fixate on 3-month returns, but if any executive tries to do otherwise he isn't just fired but summarily executed along with all his senior staff as a lesson to others. Oh, and management at all levels make Dilbert look optimistic: no one actually even knows how to maximize 3-month returns, or how to do anything at all in particular; they just stick with what they're currently doing and sometimes randomly try new ideas (and if 3-month returns don't improve, even for unrelated reasons, everyone involved is also executed). Oh, and sometimes the government introduces arbitrary new regulatory schemes with no reason or warning, and any companies that (by means of trying random new ideas) don't find a way to make decent 3-month returns also have all their senior staff executed. New companies get started semi-regularly, but they're managed just as incoherently. And the system has been running that way for untold millennia. That's evolution. A chronicle of blind stupidity and senseless mistakes, unfathomably vast, written in blood. Makes our silly human affairs look positively cheery in comparison, doesn't it?
- rudin 17y ago
  The average life expectancy of a multinational corporation-Fortune 500 or its equivalent-is between 40 and 50 years and they have been around for 500 years or less (in their current form). Compare this with the time humans took to evolve. The vast time involved more than compensates for the slower rate of change.

by dstorrs 17y ago

camccann 17y ago

LESS short-sighted? Quite so! I fear you overestimate biological evolution. Imagine a market with the same kind of behaviors you describe, only a million times larger, and where not only do markets fixate on 3-month returns, but if any executive tries to do otherwise he isn't just fired but summarily executed along with all his senior staff as a lesson to others. Oh, and management at all levels make Dilbert look optimistic: no one actually even knows how to maximize 3-month returns, or how to do anything at all in particular; they just stick with what they're currently doing and sometimes randomly try new ideas (and if 3-month returns don't improve, even for unrelated reasons, everyone involved is also executed). Oh, and sometimes the government introduces arbitrary new regulatory schemes with no reason or warning, and any companies that (by means of trying random new ideas) don't find a way to make decent 3-month returns also have all their senior staff executed. New companies get started semi-regularly, but they're managed just as incoherently. And the system has been running that way for untold millennia. That's evolution. A chronicle of blind stupidity and senseless mistakes, unfathomably vast, written in blood. Makes our silly human affairs look positively cheery in comparison, doesn't it?

rudin 17y ago
The average life expectancy of a multinational corporation-Fortune 500 or its equivalent-is between 40 and 50 years and they have been around for 500 years or less (in their current form). Compare this with the time humans took to evolve. The vast time involved more than compensates for the slower rate of change.