@GossiTheDog it is very brave of you to post in your condition.
Over at the QSite, I am only just learning that FedNow — the United States' wayyyy overdue network for enabling many countries have had for years, "real time" (intraday) bank transfers and payments — is a conspiracy to control us, a stepping stone towards (horrors!) CBDC, and the true motive for the murder of Bob Lee.
It's important to remember that Twitter has become basically a successor to Weekly World News in order not to despair too deeply. https://twitter.com/search?q=FedNow
@blherrou maybe. but maybe it's better to compare indexing to explicitly low-information forms of investing. if you aren't investing based on information about firm prospects then, sure, paying an active manager high fees who probably also lacks any real new information is a bigger ripoff to the end investor. but we have securities for low information investors, from CDs to bonds. going for equity returns on no information is a bit... rentierish, perhaps.
@blherrou (btw, i'm not condemning individuals who invest via index funds and ETFs. that's sometimes wise, sometimes not, at a personal level. but at an architectural level, i'm not sure why we want a financial system in which ordinary people with little information hold equities, and come to make political demands of outsize returns. the Obama administration was very explicit about measuring its economic performance in equity returns, a very bad idea.)
@blherrou (this is an old view of mine: why should no-information investors expect equity returns free-riding off of pricing work by active investors, whose returns their presence diminishes? it occurs to me now that in theory i can make a case for this kind of investing in terms of systemic risk. diversified equity investors bear first-loss on systemic risk, justifying some outsize return…
@blherrou if it leads to structuring more of the aggregate investment portfolio as equity rather than debt, that reduces the risk of disruptive debt defaults. we're better off if our aggregate cap structure is tilted towards equity rather than debt, indexing could encourage that. in practice, though, i'm still skeptical. if this was our rationale, we'd want financial rules and procedures to encourage regular new equity issuance by existing firms, and…
@blherrou we'd expect to new primary-market equity investment -- ie not purchases of existing shares -- to exceed payouts. instead our current practices treat after IPO primary-market-confusingly-called-"secondary"-offerings as rare, regulated events, so the market treats them as confessions by managers of overvaluation, so they are infrequent.)
@blherrou (in other words, for this version of socially useful low-information diversified investing to make sense, it should lead to firms retiring debt and issuing equity into the market. but we much more often see debt-financed buybacks of equity, exactly the opposite, during this era of the index investor. part of that is that it's been a low interest rate era! but i think we'd need to regulate quite differently if we wanted to use indexing to promote systemic derisking.)
@blherrou indexing is low information investing based on a sometimes-empirical-regularity that stocks do well over the long term, which, when it works, means people who contribute no information to the investment process nevertheless earn outside returns. seems like a pretty apt description to me!
(but it might not work, depending when you get in and when you need to get out! so it's at best a defective recliner!)
"the 'hard numbers' found in CBO’s baseline tables conceal all the assumptions and uncertainties involved in producing them." #PhilipRocco https://prospect.org/economy/2023-04-06-congress-prisoners-of-their-own-device/
"The Chinese grand strategy, in short, is America’s own forgotten Hamiltonian strategy. That strategy emphasized massive investment in real, productive sectors" #RobertHockett https://roberthockett.substack.com/p/trading-places
[new draft post] Alignment is the problem of God's love https://drafts.interfluidity.com/2023/04/06/alignment-is-the-problem-of-gods-love/index.html
@bergmayer it’s prefect!
“these models are deeply and consistently wrong. But ‘wrong’ doesn’t capture the true problem. The deeper problem is that these models are all wrong in the very same way, and in the same direction. They are wrong in a way that massively benefits the rich, and massively disadvantages everyone and everything else.” #NickHanauer https://prospect.org/economy/2023-04-05-six-ways-economic-models-killing-economy/ ht @lou
@ZaneSelvans but each of us can be eaten just once!
doom is the potato chip of the attention marketplace.
it’s bullies who most justify their behavior as opposing bullying. not-bullies have few occasions to require so grand a justification.
@sqrtminusone there is something very toddler-like about the combination.
@Frances_Coppola that’s how i perceive him as well. his claims to free speech support are as credible as the sometimes-richest-man-in-the-world’s claim to socialism.
@LouisIngenthron @ntnsndr (that wasn’t the implication i intended. only that the assertions strike me as equally credible.)
@ntnsndr i don't think there's any inconsistently between the claims. i just think they are both equally credible.
Elon Musk refers to himself as both a free speech absolutist and a socialist.
"there is nothing *more* political than insisting that your own preferences and assumptions are 'empirical' while anyone who questions them is 'doing politics.'"
"...Incinerating the qualitative and doing arithmetic with the dubious quantitative residue that remains is no way to understand the world, much less run it"
~@pluralistic https://pluralistic.net/2023/04/03/all-models-are-wrong/
mastodon should clone twitter’s “community notes” feature just so it could be called “well actually”.
Chat GPT seems to be evolving towards a very well-informed, but very conventional and risk-averse persona. It is like they made HR our interface to Google.