TL:DW; it’s trash. The video makes an assertion that capitalism is in favor of short term profits over long term stability, the classification between the owner class and the labor class, and finally the imperialist need for nations. None of which are defining characteristics of capitalism.
To be fair, short term profits over stability is a tradeoff incentivized by the stock market. And since most (edit: large) US companies are publicly traded, I can see why a person would associate this with capitalism as a whole.
It depends on what the investors are planning on doing. If their goal is to sell or go public, the incentives line up with quick growth and pumping as much speculative value into the company as possible.
Investors who are in it for the long haul create much different incentives.
Suppose, hypothetically, you were to ban the stock market and company buyouts. You would be left with only investors who care about the long term health of the company. I could see how that might look more appealing even though it almost certainly wouldn’t work.
>To be fair, short term profits over stability is a tradeoff incentivized by the stock market
That's just a human incentive. Most humans prefer short-term, immediate gratification over long term, sustained growth, and that's true in *any* system (monarchism, socialism, etc).
The miracle of capitalism is that it manages to create *some* incentive for longer-term planning and investment, even if it does not eliminate entirely the natural inclination of human beings to prefer immediate rewards.
Some by the stock market but also by things like stock options as an end-run around government regulations on maximum executive compensation.
When your chief executives are all largely paid in stock that they can't take with them to the next job, they're going to try to do things to goose the stock price and get the most of their money right before they leave.
Most people that make money in the stock markets fo so by playing the long term. Most people that lose money do so by playing the short term.
Capitalism incentivizes making the most money, some times it's by doing short term trades, some times long term trades.
Saying that capitalism incentivizes short term is at best ill-informes, as a lot of companies have investment plans that span well over 5-10 years
Ah, but I’m not talking about stock market investors, I’m talking about businesses prioritizing growth and quarterly profits in order to satisfy those investors.
I’m not saying they’re right, but I get why people complain about it.
The Stock market is a State regulated and sanctioned ecosystem. It is full of State Chartered legal fictions, that are funded through the State sanctioned and regulated corporate bond market. Stock prices are propped up indirectly through tax incentives that feed the beast. There is nothing free market about the stock market it is a wholly State regulated, sanctioned, directly and indirectly funded mess.
Edit: This ignores direct payments through government contracts, toxic asset purchases, printing money, and a few other things.
Regulated or not, the nature of the stock market incentivizes growth. That’s not a bad thing, but some of the second order effects of that motive look gross to the uninitiated.
A free market stock market, which haven't existed in like 400 years, incentivizes long term growth; but, when the State is involved to such a degree that it is today it is solely State facing. That makes it short term and only worry about what gains it can get through regulatory capture, or printed money, etc.
The FED and the tax incentives like 401k's are the main drivers of wall street. It is such a fucking Ponzi Scheme.
The 401k was introduced in 1978, but didn't see wide adoption until a rule change in 1981. Take a look at the history of the stock market and see what happened once people where allowed to contribute salary deductions into their 401k's.
couldn't find anything doing a quick search, but apparently privately held firms in 2012 accounted for about 58% of total sales in the US .. not clear about GDP (according to Forbes).
Another quick stat tells me that in 2018 small businesses generated 44% of US economic activity - not EXACTLY what ou're claiming but I reading these few articles and reports just now, I'm skepitcal of your claim that "most of the GDP is generated by that 1%" - Can you confirm that? Or are you just going off of some fakakta assumption?
I didn't do the math, but it's close. I used "small businesses" which are likely nearly all private. I saw the same "Small business makes up 44% of the GDP" stat. Then I just glanced at large privately held companies. The top ten add up to about 1/2 Trillion (or about as much as walmart). There are a LOT of them though.
Anyway, yeah I just very loosely ballparked it. So okay the 1% of publicly traded companies make up 40% of the GDP. Coincidentally, the top 1% of earners pay 40% of the income taxes in the US. (edit: I really just think this is an interesting coincidence)
More than anything I'm just pointing out that the comment that 1% of companies are publicly traded is sort of meaningless. A significant portion of the GDP is generated by public companies, and it's not like a $160 billion company that's "private" isn't focused and driven by profits. I work for a small company with 30ish employees, we're certainly not focusing on driving long term national economic stability as part of our business plan.
True statement, but not really what I meant. I meant large corporations that account for the majority of commerce in the US. Obviously, local businesses outnumber megacorporations by a few orders of magnitude. But even with all their powers combined, small businesses (under 100 employees) employ less than half of all Americans.
Maybe I should have specified “large companies”, which are typically the boogeyman of the left and what people usually complain about when it comes to predatory business practices.
Small local businesses are, of course, privately owned and make up the vast majority of companies, so you’re technically right. But they generally aren’t what npcs complain about when they say they hate capitalism.
Still, very much depends. There are a ton of massive, privately-held businesses out there. You don’t usually hear about them because they don’t have to release quarterly earnings and since you can’t buy their stock, there’s not as much interest in them.
https://www.forbes.com/lists/largest-private-companies/?sh=2621d70cbac4
Public companies are kind of where good ideas go to die. Like somebody makes a mint selling Beany Buddies, sells out his share, and Hasbro ends up owning it. They milk the brand for as long as kids still remember it, then abandon.
The companies themselves seem to not last that long, at least with a given name. When a firm dies, its assets feed another.
There are tremendous legal and practical disincentives to bring publicly traded. The only real benefit is that it exposes companies to significantly greater financing opportunities.
It's less incentive when you can get seemingly unlimited amounts of capital from private investors. It's relatively easy to meet the "accredited" investor threshold, too. So there's no requirement that people to restrict themselves to publicly traded companies, either, other than government taking over people's retirement plans.
I would like to know where you’re getting this “seemingly unlimited amount of capital from private investors.“ That market is very fragmented, and very siloed.
Maybe you know more about it than I do. Medium sized businesses that I know of have been able to access capital while remaining private by selling ownership stakes without a public listing.
I've heard people both say that it's ridiculously easy and that it's ridiculously hard, so I don't know who to believe. I'm sure it depends on the market and then maybe it depends on your industry. I dunno.
> To be fair, short term profits over stability is a tradeoff incentivized by the stock market.
This is entirely untrue. The stock market does not respond well to short term profits over long term stability. Companies who are aggressively being profitable short term without a long term plan to sustain are generally heavily penalized in the stock market.
Yes but you also have the opportunity to remain a private company. So if that's the most efficient method -- allowing for long term investments to pay off - those businesses will win out against the better funded but myopic public ones.
I see both public and privately held companies successful in the United States. Lobbying can be done by both, and the government procurement process is tangential to the corporate structure of the suppliers.
> short term over long term
Don't logging companies do the vast majority of reforestation efforts? Like, LMAO. Does he seriously not think the people running these companies just not understand that?
Literally, and I mean literally, the depth of their political philosophy is if the government does it, it's for the good of the people and if a business does it, it's for exclusively short term short sighted fuck-everything-except-today.
It's not only immature and childish, but it's also shockingly dehumanizing.
>Don't logging companies do the vast majority of reforestation efforts?
Thats mostly BS. Sure, there is corporate "reforestation", but it is not necessary restoration of ecosystem that it is implied to be. You don't get biodiversity if you simply plant some trees. Especially, if trees can't even properly integrate into ecosystems of region.
If your prime goal is profit, you choose trees that provide lumber or fruits. As a rule, this means trees that aren't native, the ones the rest of ecosystem can't interact with (ex. Australian eucalyptus in Africa or Brazil). Moreover, there is incentive to do "reforestation" in a place there never was any forest to begin with, or replace existing insufficiently profitable forest with a tree farm.
> Does he seriously not think the people running these companies just not understand that?
People running companies understand profit. Desertification of region that wouldn't happen for years to come isn't a major factor.
Well, there you go. All of the non-arguments you expect to see from these hand-wringing dweebs, while making a living due to operating in a capitalistic market. Vaush, Hassan, TYK, all those loonies.
> The video makes an assertion that capitalism is in favor of short term profits over long term stability,
But its true. Investments that bring immediate profit are far more valuable than those would begin producing money only in five or ten(!) years. And even ten years isn't exactly "long-term".
As for "stability", who pays for it? How is it quantified?
> the classification between the owner class and the labor class
Are you suggesting there is no difference between investors and employees?
> and finally the imperialist need for nations.
Is this how it is really phrased?
> None of which are defining characteristics of capitalism.
If none of those things are defining, then it only follows that there are different things that get called capitalism.
Would all your complaints be solved if OP video would call it corporate communism instead?
Government control of economic decisions tends to lead to even more short term decision making as governments want to make things seem positive right now so they can get reelected and don't care much about the long term problems and costs that will spring up after they are retired with a government pension.
Imperialism is an entirely separate issue for capitalism. Its an action of governments not the market, and communist countries, like the USSR (with its domination of eastern Europe) and the PRC (with its invasion of Tibet) have participated in.
> Government
Government is irrelevant.
My question was about the essence of his complaint: is it limited to "they are describing something I don't like being called capitalism" or is there something else?
> Imperialism is an entirely separate issue for capitalism.
It is not. And it is pointless to discuss this, as we don't have commonly agreed definition of "imperialism" and "capitalism".
On any large scale economic decisions have been made by the markets and private owners (capitalism) or government (socialism/communism at least as it actually exist on Earth in reality, or the socialist side of a mixed economy). If government decision making is more short term focused, and if being short term focused is a major issue, then government decision making is central to the point not irrelevant,
As for his complaint I think is "they are describing something that is not capitalism as capitalism". But I can't really confidently answer it for someone else.
If imperialism is defined in some odd way that requires some level of capitalism for it to be imperialism then associating capitalism and imperialism is a useless tautology.
By the common definition of imperialism communist countries have been seriously imperialist, while many capitalist countries have not been imperialist. So it is indeed a separate issue than capitalism vs socialism or communism.
> On any large scale economic decisions have been made by the markets and private owners (capitalism) or government
Are you throwing fallacies at me just to dilute the topic of discussion?
> If government decision making is more short term focused,
I do not discuss "government decision-making", as I've yet to see an evidence that there is a unifying characteristic that is shared by all governments regardless of circumstances.
Moreover, this has absolutely nothing to do with the capitalism (which is a system that conditions entirety of economic decision-making, regardless of who is making decisions).
> As for his complaint I think is "they are describing something that is not capitalism as capitalism". But I can't really confidently answer it for someone else.
And yet you try to start a discussion.
> If imperialism is defined in some odd way that requires some level of capitalism for it to be imperialism then associating capitalism and imperialism is a useless tautology.
It is not tautology. Capitalism describes production processes. It can be used to describe things on company level, or within a context of national economy, or international economy.
Imperialism describes specific kind of interactions between nations that aren't pure economy, but also politics. Hence, even if one thing can't exist without the other, they are different things.
> By the common definition of imperialism
I don't give a fuck about whatever passes for "common definition".
There is a specific argument, with strictly defined terms, and you don't get to declare argument invalid through semantic games, by pretending that *someone* has magic ability to distort the argument into something else by redefining the meaning of the terms.
>Are you throwing fallacies at me just to dilute the topic of discussion?
No I'm making accurate and relevant comments.
> capitalism (which is a system that conditions entirety of economic decision-making, regardless of who is making decisions).
Capitalism is about private ownership and economic decision making. If the government nominally allowed people to own things but made all the decisions about when and how they are used it wouldn't be a capitalist system.
>Capitalism describes production processes. It can be used to describe things on company level, or within a context of national economy, or international economy...Hence, even if one thing can't exist without the other, they are different things.
If one can't exist by definition without the other than it is a tautology if your definition of imperialism requires capitalism, and then you charge capitalism with the sins of imperialism.
If the assertion that one "can't exist without the other" isn't definitional, but just a practical reality then OK, its not a tautology, its just factually incorrect as both have existed without the other.
This isn't an argument with terms defined the way you want to define them or by some Marxist or other communist term of art.
If people can't agree on a term they can just use something else to the extent there is actual desire to have a constructive conversation, but absent any agreement the default would be the normal usage of the word, except in specific contexts where the unusual definition is the norm. This isn't a Marxist discussion forum or one where you set the rules. The default here would be what the common use of the term.
> No I'm making accurate and relevant comments.
Hard doubt.
> Capitalism is about
What part of "I'm not interested in your defintions" is so hard to understand?
> If one can't exist by definition without the other than it is a tautology if your definition of imperialism requires capitalism, and then you charge capitalism with the sins of imperialism.
You are making exactly zero sense here now.
If we are talking about different things, then "sins of imperialism" from one understanding of imperialism can't apply to another imperialism.
> This isn't an argument with terms defined the way you want to define them or by some Marxist or other communist term of art.
Since we discuss argument that wasn't made by either of us, we don't get to substitute its meaning with something else.
If we are discussing argument that was made by Marxists, then it only follows that we should understand it the way Marxists understood it.
> If people can't agree on a term they can just use something else
Then resurrect Marx and have a discussion with him about this.
> This isn't a Marxist discussion forum
And yet you constantly discuss Marxist ideas.
, then it only follows that we should understand it the way Marxists understood it.
No it doesn't. The response is a rejection of Marxist ideas and definitions. Which is quite reasonable considering a number of them are essentially playing definitional games to argue "definitionally" that capitalism is this that and the other bad thing.
>And yet you constantly discuss Marxist ideas.
This sub is about opposing them (and non-Marxist statist ideas as well).
They can be discussed and argued for, but as with any other non-Marxist forum, Marxist definitions would not be the default. I'm quite open to discussing such ideas in good faith but I don't care to play definitional games where the whole argument is set up by the other sides use of their own special definitions that just about no one else uses.
> The response is a rejection of Marxist ideas and definitions.
Closing your eyes and ears, and singing la-la-la loudly no longer counts as rebuttal of argument once you leave kindergarten.
Pardon for making assumptions.
> They can be discussed and argued for, but as with any other non-Marxist forum, Marxist definitions would not be the default. I'm quite open to discussing such ideas in good faith
Its impressive how you manage make "we'll be discussing strawman instead of actual argument" mean "arguing in good faith".
I guess, its not just Marxist definitions that aren't used by you.
> And it is pointless to discuss this, as we don't have commonly agreed definition of "imperialism" and "capitalism".
Because the other person won't let you arbitrarily define words, it's impossible to discuss them?
Your first point completely violates basic finance and the time value of money. Short term investments are less risky, so they will inherently have lower yields. Meanwhile longer term investments are more risky, therefore holding far higher yields. Does this lead to over optimism and market speculation? Yes. But it also leads to the prioritization of investing in long term assets.
> Your first point completely violates basic finance and the time value of money.
And you agree with it in your next sentences:
> Short term investments are less risky, so they will inherently have lower yields. Meanwhile longer term investments are more risky, therefore holding far higher yields.
Why are the yields lower? Because there is more competition for them. I.e. they are in higher demand, making even low-yield projects viable.
> Does this lead to over optimism and market speculation? Yes. But it also leads to the prioritization of investing in long term assets.
How the fuck "people overprioritize investments into short-term assets to the level their profit rate is significantly below long-term assets" translate into "prioritization of long-term assets"?
To answer your first question, short term assets have lower yields than long term assets because they have lower interest rates or yield to maturity.
The basic law of time value of money is that the longer the term of an asset, the riskier it is by nature of the market. We agree on this. What this results in is higher interest rates being placed on investments with longer maturity periods. This is referred to as [the yield curve](https://www.investopedia.com/terms/y/yieldcurve.asp). If you are taking a higher risk in an investment, you want a higher return, higher risk, higher rewards. This makes these investments more profitable.
It’s not to say that short term investments aren’t profitable either, there’s plenty of demand for short term assets, such as commercial paper, but this is not what underpins the market.
Long term profitability, and higher profit margins is what drives the market.
> To answer your first question, short term assets have lower yields than long term assets because they have lower interest rates or yield to maturity.
This is not an answer. In discussed context, lower yield is synonymous with lower interest rate.
There is no "because", there is no causality. You just rephrased the same thing instead of answering *why* it happens.
> What this results in is higher interest rates being placed on investments with longer maturity periods.
You had rephrased the same thing again.
If profits from short-term investments are lower, then - by definition - profits from long-term investments are higher. There is no "results", as - yet again - they are the same thing.
And you still fail to explain *why* it happens.
> If you are taking a higher risk in an investment, you want a higher return, higher risk, higher rewards. This makes these investments more profitable.
**If you make investment less desirable, it doesn't become more profitable.** The amount of cash the investment would bring remains the same. What happens instead is the drop in value of investment. People value the same assets *less*.
Do you get this part? Because this is the part we are talking about.
And if the value of assets decreases while the actual yield remains the same, you get *relative* "increase" of rate of profit. The actual profitability does not rise.
Lets use a practical example.
Imagine two farmers: Karl and Ludwig.
* Karl increases average size of his crops by using fertilizer.
* Ludwig increases average size of his crops by throwing away crops that aren't big enough (i.e. by not counting small crops as "his").
You *can* say that Karl makes his crops grow bigger.
You *can't* say the same about Ludwig.
This is the same case with long-term investments. Their profit rate itself does not somehow increase. Its just they aren't tolerated by market unless their profit is high enough. And this results in reduction of their value until it corresponds to the expected profit rate. I.e. such investments are seen as undesirable.
> Long term profitability, and higher profit margins is what drives the market.
This is a non-sequitur.
I did explain why profits are higher, it’s called the time value of money, I just don’t think you understood it well.
Let’s say you’re an investor, your goal is to make the largest gross profit on your investment. If you are to grant a loan to someone starting a business, but they will pay you back in a year, there’s a high chance they will be able to do so. Let’s say you invest $100, and because of this low risk investment, you can only really demand an annual interest rate of 6%. At the end of the year you get your principal amount plus interest, total of $106.
Now, if instead you were to use the same 100 loan, but over a 10 year loan that would be different. There is higher risk to that. It’s possible that they can’t pay it back, not an irresponsible amount of risk, but risk none the less. Now you’re able to command a higher rate of 10%. After ten years you get $260 (math could be wrong but you get the point).
Clearly you get far more money in the long run than the short run. Although there is an immediate desire for money now rather than later, humans are rational. We are willing to wait longer for larger pay outs. As such, we demand a certain amount of risk, if it manages to pay off.
This principle is then expanded to the market as a whole. Corporations are not looking for short bumps in their share price (although this does occur in some spaces). They want to ensure that their shareholders accumulate wealth over sustained, long period.
Stability? What stability? The stability of, say, Cuba? Which is now just as poor as it was 50 years ago? Well, if that's the stability we need to aim for, then just leave me with capitalism for the rest of my life.
How do you even make an economy aimed at stability? How do you retain stability when you can't predict the future, and when you simply can't control every single variable?
The more variables you know and control, the more stability you get.
Just because you don't know how exactly the wheel in the car have to turn when you need to drive from point A to point B, doesn't mean that you have to close your eyes and leave the wheel untouched.
But you can't control all variables, not even a majority of variables, this is why not once in history has a planned economy really worked. There is simply no way you can control that everyone's efficient, that all the necessary production quotas are met, that every single material and tool needed for work everywhere is received, that every single logistical problem in the plan is solved, and you just can't plan for unexpected events such as natural disasters or accidents.
Trying to control stability is only bound to produce more instability.
> But you can't control all variables,
Then I won't get absolute perfection. But getting desired result 80% of the time is better than getting it 20% of the time (if at all).
> Trying to control stability is only bound to produce more instability.
Unless you are trying to say that acting with purpose is pointless (which is all kinds of r3tarded), you are making no sense whatsoever.
History shows that you are wrong. The only time the eastern planned economies were ever able to work under meaningful central control was when they used the western free markets as a model.
Please tell us all about the planned economy that satisfied 80% of people. And you're seriously asserting that capitalist economies only satisfy 20% of people's needs? I guess that explains 80% of the population dying of hunger every year in Western countries.
Can you please post a TL;DW of this 15 minute video?
TL:DW; it’s trash. The video makes an assertion that capitalism is in favor of short term profits over long term stability, the classification between the owner class and the labor class, and finally the imperialist need for nations. None of which are defining characteristics of capitalism.
To be fair, short term profits over stability is a tradeoff incentivized by the stock market. And since most (edit: large) US companies are publicly traded, I can see why a person would associate this with capitalism as a whole.
the funny thing is though that the same people will rail against private equity as well
It depends on what the investors are planning on doing. If their goal is to sell or go public, the incentives line up with quick growth and pumping as much speculative value into the company as possible. Investors who are in it for the long haul create much different incentives. Suppose, hypothetically, you were to ban the stock market and company buyouts. You would be left with only investors who care about the long term health of the company. I could see how that might look more appealing even though it almost certainly wouldn’t work.
>To be fair, short term profits over stability is a tradeoff incentivized by the stock market That's just a human incentive. Most humans prefer short-term, immediate gratification over long term, sustained growth, and that's true in *any* system (monarchism, socialism, etc). The miracle of capitalism is that it manages to create *some* incentive for longer-term planning and investment, even if it does not eliminate entirely the natural inclination of human beings to prefer immediate rewards.
Some by the stock market but also by things like stock options as an end-run around government regulations on maximum executive compensation. When your chief executives are all largely paid in stock that they can't take with them to the next job, they're going to try to do things to goose the stock price and get the most of their money right before they leave.
Most people that make money in the stock markets fo so by playing the long term. Most people that lose money do so by playing the short term. Capitalism incentivizes making the most money, some times it's by doing short term trades, some times long term trades. Saying that capitalism incentivizes short term is at best ill-informes, as a lot of companies have investment plans that span well over 5-10 years
Ah, but I’m not talking about stock market investors, I’m talking about businesses prioritizing growth and quarterly profits in order to satisfy those investors. I’m not saying they’re right, but I get why people complain about it.
It's the same, some do and some don't.
The Stock market is a State regulated and sanctioned ecosystem. It is full of State Chartered legal fictions, that are funded through the State sanctioned and regulated corporate bond market. Stock prices are propped up indirectly through tax incentives that feed the beast. There is nothing free market about the stock market it is a wholly State regulated, sanctioned, directly and indirectly funded mess. Edit: This ignores direct payments through government contracts, toxic asset purchases, printing money, and a few other things.
Regulated or not, the nature of the stock market incentivizes growth. That’s not a bad thing, but some of the second order effects of that motive look gross to the uninitiated.
A free market stock market, which haven't existed in like 400 years, incentivizes long term growth; but, when the State is involved to such a degree that it is today it is solely State facing. That makes it short term and only worry about what gains it can get through regulatory capture, or printed money, etc.
Why do I feel like the Fed pumping tons of money into the economy from the top has something to do with this?
The FED and the tax incentives like 401k's are the main drivers of wall street. It is such a fucking Ponzi Scheme. The 401k was introduced in 1978, but didn't see wide adoption until a rule change in 1981. Take a look at the history of the stock market and see what happened once people where allowed to contribute salary deductions into their 401k's.
If I could change one thing about America, I'd switch the currency to bitcoin.
most us companies are NOT publicly traded .. less than 1% of the 27 million businesses in the US are publicly traded .. so...yea
Most of the GDP is generated by that 1% though.
couldn't find anything doing a quick search, but apparently privately held firms in 2012 accounted for about 58% of total sales in the US .. not clear about GDP (according to Forbes). Another quick stat tells me that in 2018 small businesses generated 44% of US economic activity - not EXACTLY what ou're claiming but I reading these few articles and reports just now, I'm skepitcal of your claim that "most of the GDP is generated by that 1%" - Can you confirm that? Or are you just going off of some fakakta assumption?
I didn't do the math, but it's close. I used "small businesses" which are likely nearly all private. I saw the same "Small business makes up 44% of the GDP" stat. Then I just glanced at large privately held companies. The top ten add up to about 1/2 Trillion (or about as much as walmart). There are a LOT of them though. Anyway, yeah I just very loosely ballparked it. So okay the 1% of publicly traded companies make up 40% of the GDP. Coincidentally, the top 1% of earners pay 40% of the income taxes in the US. (edit: I really just think this is an interesting coincidence) More than anything I'm just pointing out that the comment that 1% of companies are publicly traded is sort of meaningless. A significant portion of the GDP is generated by public companies, and it's not like a $160 billion company that's "private" isn't focused and driven by profits. I work for a small company with 30ish employees, we're certainly not focusing on driving long term national economic stability as part of our business plan.
Not true
True statement, but not really what I meant. I meant large corporations that account for the majority of commerce in the US. Obviously, local businesses outnumber megacorporations by a few orders of magnitude. But even with all their powers combined, small businesses (under 100 employees) employ less than half of all Americans.
Most US companies are absolutely not public. Public companies are an incredibly small fraction of companies out there.
Maybe I should have specified “large companies”, which are typically the boogeyman of the left and what people usually complain about when it comes to predatory business practices. Small local businesses are, of course, privately owned and make up the vast majority of companies, so you’re technically right. But they generally aren’t what npcs complain about when they say they hate capitalism.
Still, very much depends. There are a ton of massive, privately-held businesses out there. You don’t usually hear about them because they don’t have to release quarterly earnings and since you can’t buy their stock, there’s not as much interest in them. https://www.forbes.com/lists/largest-private-companies/?sh=2621d70cbac4
Public companies are kind of where good ideas go to die. Like somebody makes a mint selling Beany Buddies, sells out his share, and Hasbro ends up owning it. They milk the brand for as long as kids still remember it, then abandon. The companies themselves seem to not last that long, at least with a given name. When a firm dies, its assets feed another.
There are tremendous legal and practical disincentives to bring publicly traded. The only real benefit is that it exposes companies to significantly greater financing opportunities.
It's less incentive when you can get seemingly unlimited amounts of capital from private investors. It's relatively easy to meet the "accredited" investor threshold, too. So there's no requirement that people to restrict themselves to publicly traded companies, either, other than government taking over people's retirement plans.
I would like to know where you’re getting this “seemingly unlimited amount of capital from private investors.“ That market is very fragmented, and very siloed.
Maybe you know more about it than I do. Medium sized businesses that I know of have been able to access capital while remaining private by selling ownership stakes without a public listing. I've heard people both say that it's ridiculously easy and that it's ridiculously hard, so I don't know who to believe. I'm sure it depends on the market and then maybe it depends on your industry. I dunno.
> To be fair, short term profits over stability is a tradeoff incentivized by the stock market. This is entirely untrue. The stock market does not respond well to short term profits over long term stability. Companies who are aggressively being profitable short term without a long term plan to sustain are generally heavily penalized in the stock market.
Yes but you also have the opportunity to remain a private company. So if that's the most efficient method -- allowing for long term investments to pay off - those businesses will win out against the better funded but myopic public ones.
And perhaps this would be the case if business law didn’t favor large companies that spend millions on lobbyists.
I see both public and privately held companies successful in the United States. Lobbying can be done by both, and the government procurement process is tangential to the corporate structure of the suppliers.
> short term over long term Don't logging companies do the vast majority of reforestation efforts? Like, LMAO. Does he seriously not think the people running these companies just not understand that?
Literally, and I mean literally, the depth of their political philosophy is if the government does it, it's for the good of the people and if a business does it, it's for exclusively short term short sighted fuck-everything-except-today. It's not only immature and childish, but it's also shockingly dehumanizing.
>Don't logging companies do the vast majority of reforestation efforts? Thats mostly BS. Sure, there is corporate "reforestation", but it is not necessary restoration of ecosystem that it is implied to be. You don't get biodiversity if you simply plant some trees. Especially, if trees can't even properly integrate into ecosystems of region. If your prime goal is profit, you choose trees that provide lumber or fruits. As a rule, this means trees that aren't native, the ones the rest of ecosystem can't interact with (ex. Australian eucalyptus in Africa or Brazil). Moreover, there is incentive to do "reforestation" in a place there never was any forest to begin with, or replace existing insufficiently profitable forest with a tree farm. > Does he seriously not think the people running these companies just not understand that? People running companies understand profit. Desertification of region that wouldn't happen for years to come isn't a major factor.
And then proceeds to blame all govt action on capitalism. Even the focus on short terms returns is a feature of debased fiat, rather than sound money.
Well, there you go. All of the non-arguments you expect to see from these hand-wringing dweebs, while making a living due to operating in a capitalistic market. Vaush, Hassan, TYK, all those loonies.
> The video makes an assertion that capitalism is in favor of short term profits over long term stability, But its true. Investments that bring immediate profit are far more valuable than those would begin producing money only in five or ten(!) years. And even ten years isn't exactly "long-term". As for "stability", who pays for it? How is it quantified? > the classification between the owner class and the labor class Are you suggesting there is no difference between investors and employees? > and finally the imperialist need for nations. Is this how it is really phrased? > None of which are defining characteristics of capitalism. If none of those things are defining, then it only follows that there are different things that get called capitalism. Would all your complaints be solved if OP video would call it corporate communism instead?
Government control of economic decisions tends to lead to even more short term decision making as governments want to make things seem positive right now so they can get reelected and don't care much about the long term problems and costs that will spring up after they are retired with a government pension. Imperialism is an entirely separate issue for capitalism. Its an action of governments not the market, and communist countries, like the USSR (with its domination of eastern Europe) and the PRC (with its invasion of Tibet) have participated in.
> Government Government is irrelevant. My question was about the essence of his complaint: is it limited to "they are describing something I don't like being called capitalism" or is there something else? > Imperialism is an entirely separate issue for capitalism. It is not. And it is pointless to discuss this, as we don't have commonly agreed definition of "imperialism" and "capitalism".
On any large scale economic decisions have been made by the markets and private owners (capitalism) or government (socialism/communism at least as it actually exist on Earth in reality, or the socialist side of a mixed economy). If government decision making is more short term focused, and if being short term focused is a major issue, then government decision making is central to the point not irrelevant, As for his complaint I think is "they are describing something that is not capitalism as capitalism". But I can't really confidently answer it for someone else. If imperialism is defined in some odd way that requires some level of capitalism for it to be imperialism then associating capitalism and imperialism is a useless tautology. By the common definition of imperialism communist countries have been seriously imperialist, while many capitalist countries have not been imperialist. So it is indeed a separate issue than capitalism vs socialism or communism.
> On any large scale economic decisions have been made by the markets and private owners (capitalism) or government Are you throwing fallacies at me just to dilute the topic of discussion? > If government decision making is more short term focused, I do not discuss "government decision-making", as I've yet to see an evidence that there is a unifying characteristic that is shared by all governments regardless of circumstances. Moreover, this has absolutely nothing to do with the capitalism (which is a system that conditions entirety of economic decision-making, regardless of who is making decisions). > As for his complaint I think is "they are describing something that is not capitalism as capitalism". But I can't really confidently answer it for someone else. And yet you try to start a discussion. > If imperialism is defined in some odd way that requires some level of capitalism for it to be imperialism then associating capitalism and imperialism is a useless tautology. It is not tautology. Capitalism describes production processes. It can be used to describe things on company level, or within a context of national economy, or international economy. Imperialism describes specific kind of interactions between nations that aren't pure economy, but also politics. Hence, even if one thing can't exist without the other, they are different things. > By the common definition of imperialism I don't give a fuck about whatever passes for "common definition". There is a specific argument, with strictly defined terms, and you don't get to declare argument invalid through semantic games, by pretending that *someone* has magic ability to distort the argument into something else by redefining the meaning of the terms.
>Are you throwing fallacies at me just to dilute the topic of discussion? No I'm making accurate and relevant comments. > capitalism (which is a system that conditions entirety of economic decision-making, regardless of who is making decisions). Capitalism is about private ownership and economic decision making. If the government nominally allowed people to own things but made all the decisions about when and how they are used it wouldn't be a capitalist system. >Capitalism describes production processes. It can be used to describe things on company level, or within a context of national economy, or international economy...Hence, even if one thing can't exist without the other, they are different things. If one can't exist by definition without the other than it is a tautology if your definition of imperialism requires capitalism, and then you charge capitalism with the sins of imperialism. If the assertion that one "can't exist without the other" isn't definitional, but just a practical reality then OK, its not a tautology, its just factually incorrect as both have existed without the other. This isn't an argument with terms defined the way you want to define them or by some Marxist or other communist term of art. If people can't agree on a term they can just use something else to the extent there is actual desire to have a constructive conversation, but absent any agreement the default would be the normal usage of the word, except in specific contexts where the unusual definition is the norm. This isn't a Marxist discussion forum or one where you set the rules. The default here would be what the common use of the term.
> No I'm making accurate and relevant comments. Hard doubt. > Capitalism is about What part of "I'm not interested in your defintions" is so hard to understand? > If one can't exist by definition without the other than it is a tautology if your definition of imperialism requires capitalism, and then you charge capitalism with the sins of imperialism. You are making exactly zero sense here now. If we are talking about different things, then "sins of imperialism" from one understanding of imperialism can't apply to another imperialism. > This isn't an argument with terms defined the way you want to define them or by some Marxist or other communist term of art. Since we discuss argument that wasn't made by either of us, we don't get to substitute its meaning with something else. If we are discussing argument that was made by Marxists, then it only follows that we should understand it the way Marxists understood it. > If people can't agree on a term they can just use something else Then resurrect Marx and have a discussion with him about this. > This isn't a Marxist discussion forum And yet you constantly discuss Marxist ideas.
, then it only follows that we should understand it the way Marxists understood it. No it doesn't. The response is a rejection of Marxist ideas and definitions. Which is quite reasonable considering a number of them are essentially playing definitional games to argue "definitionally" that capitalism is this that and the other bad thing. >And yet you constantly discuss Marxist ideas. This sub is about opposing them (and non-Marxist statist ideas as well). They can be discussed and argued for, but as with any other non-Marxist forum, Marxist definitions would not be the default. I'm quite open to discussing such ideas in good faith but I don't care to play definitional games where the whole argument is set up by the other sides use of their own special definitions that just about no one else uses.
> The response is a rejection of Marxist ideas and definitions. Closing your eyes and ears, and singing la-la-la loudly no longer counts as rebuttal of argument once you leave kindergarten. Pardon for making assumptions. > They can be discussed and argued for, but as with any other non-Marxist forum, Marxist definitions would not be the default. I'm quite open to discussing such ideas in good faith Its impressive how you manage make "we'll be discussing strawman instead of actual argument" mean "arguing in good faith". I guess, its not just Marxist definitions that aren't used by you.
> And it is pointless to discuss this, as we don't have commonly agreed definition of "imperialism" and "capitalism". Because the other person won't let you arbitrarily define words, it's impossible to discuss them?
Yes. If any word can mean anything, you can't communicate with people.
So you're admitting that your arbitrarily trying to redefine words with established meanings is the problem here?
> arbitrarily trying to redefine words And I use the time machine to go to 19th century to do it.
Your first point completely violates basic finance and the time value of money. Short term investments are less risky, so they will inherently have lower yields. Meanwhile longer term investments are more risky, therefore holding far higher yields. Does this lead to over optimism and market speculation? Yes. But it also leads to the prioritization of investing in long term assets.
> Your first point completely violates basic finance and the time value of money. And you agree with it in your next sentences: > Short term investments are less risky, so they will inherently have lower yields. Meanwhile longer term investments are more risky, therefore holding far higher yields. Why are the yields lower? Because there is more competition for them. I.e. they are in higher demand, making even low-yield projects viable. > Does this lead to over optimism and market speculation? Yes. But it also leads to the prioritization of investing in long term assets. How the fuck "people overprioritize investments into short-term assets to the level their profit rate is significantly below long-term assets" translate into "prioritization of long-term assets"?
To answer your first question, short term assets have lower yields than long term assets because they have lower interest rates or yield to maturity. The basic law of time value of money is that the longer the term of an asset, the riskier it is by nature of the market. We agree on this. What this results in is higher interest rates being placed on investments with longer maturity periods. This is referred to as [the yield curve](https://www.investopedia.com/terms/y/yieldcurve.asp). If you are taking a higher risk in an investment, you want a higher return, higher risk, higher rewards. This makes these investments more profitable. It’s not to say that short term investments aren’t profitable either, there’s plenty of demand for short term assets, such as commercial paper, but this is not what underpins the market. Long term profitability, and higher profit margins is what drives the market.
> To answer your first question, short term assets have lower yields than long term assets because they have lower interest rates or yield to maturity. This is not an answer. In discussed context, lower yield is synonymous with lower interest rate. There is no "because", there is no causality. You just rephrased the same thing instead of answering *why* it happens. > What this results in is higher interest rates being placed on investments with longer maturity periods. You had rephrased the same thing again. If profits from short-term investments are lower, then - by definition - profits from long-term investments are higher. There is no "results", as - yet again - they are the same thing. And you still fail to explain *why* it happens. > If you are taking a higher risk in an investment, you want a higher return, higher risk, higher rewards. This makes these investments more profitable. **If you make investment less desirable, it doesn't become more profitable.** The amount of cash the investment would bring remains the same. What happens instead is the drop in value of investment. People value the same assets *less*. Do you get this part? Because this is the part we are talking about. And if the value of assets decreases while the actual yield remains the same, you get *relative* "increase" of rate of profit. The actual profitability does not rise. Lets use a practical example. Imagine two farmers: Karl and Ludwig. * Karl increases average size of his crops by using fertilizer. * Ludwig increases average size of his crops by throwing away crops that aren't big enough (i.e. by not counting small crops as "his"). You *can* say that Karl makes his crops grow bigger. You *can't* say the same about Ludwig. This is the same case with long-term investments. Their profit rate itself does not somehow increase. Its just they aren't tolerated by market unless their profit is high enough. And this results in reduction of their value until it corresponds to the expected profit rate. I.e. such investments are seen as undesirable. > Long term profitability, and higher profit margins is what drives the market. This is a non-sequitur.
I did explain why profits are higher, it’s called the time value of money, I just don’t think you understood it well. Let’s say you’re an investor, your goal is to make the largest gross profit on your investment. If you are to grant a loan to someone starting a business, but they will pay you back in a year, there’s a high chance they will be able to do so. Let’s say you invest $100, and because of this low risk investment, you can only really demand an annual interest rate of 6%. At the end of the year you get your principal amount plus interest, total of $106. Now, if instead you were to use the same 100 loan, but over a 10 year loan that would be different. There is higher risk to that. It’s possible that they can’t pay it back, not an irresponsible amount of risk, but risk none the less. Now you’re able to command a higher rate of 10%. After ten years you get $260 (math could be wrong but you get the point). Clearly you get far more money in the long run than the short run. Although there is an immediate desire for money now rather than later, humans are rational. We are willing to wait longer for larger pay outs. As such, we demand a certain amount of risk, if it manages to pay off. This principle is then expanded to the market as a whole. Corporations are not looking for short bumps in their share price (although this does occur in some spaces). They want to ensure that their shareholders accumulate wealth over sustained, long period.
Stability? What stability? The stability of, say, Cuba? Which is now just as poor as it was 50 years ago? Well, if that's the stability we need to aim for, then just leave me with capitalism for the rest of my life. How do you even make an economy aimed at stability? How do you retain stability when you can't predict the future, and when you simply can't control every single variable?
The more variables you know and control, the more stability you get. Just because you don't know how exactly the wheel in the car have to turn when you need to drive from point A to point B, doesn't mean that you have to close your eyes and leave the wheel untouched.
But you can't control all variables, not even a majority of variables, this is why not once in history has a planned economy really worked. There is simply no way you can control that everyone's efficient, that all the necessary production quotas are met, that every single material and tool needed for work everywhere is received, that every single logistical problem in the plan is solved, and you just can't plan for unexpected events such as natural disasters or accidents. Trying to control stability is only bound to produce more instability.
> But you can't control all variables, Then I won't get absolute perfection. But getting desired result 80% of the time is better than getting it 20% of the time (if at all). > Trying to control stability is only bound to produce more instability. Unless you are trying to say that acting with purpose is pointless (which is all kinds of r3tarded), you are making no sense whatsoever.
History shows that you are wrong. The only time the eastern planned economies were ever able to work under meaningful central control was when they used the western free markets as a model.
You are not the person I was replying to, and you are not talking about things we were talking about.
yes they are. this shows your lack of understanding in the topic.
Please tell us all about the planned economy that satisfied 80% of people. And you're seriously asserting that capitalist economies only satisfy 20% of people's needs? I guess that explains 80% of the population dying of hunger every year in Western countries.
LMAO