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  • Glyphglyph@mastodon.social
    Nov 4, 2026, 10:51 PM

    @mcc the *general* idea of a high risk/reward business venture is not totally crazy. I really don't want to veer into the idea that capital markets are a morally valorous technology, that would be like saying we should shove random stuff into a blast furnace because blast furnaces are cool, but there *is* a non-nightmare version of this, where this sort of investment goes towards creative projects. You could argue that movie studios and haute cuisine restaurants look like this.

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Replies

  • Glyphglyph@mastodon.social
    Nov 4, 2026, 10:52 PM

    @mcc weapons can be extremely profitable but there's a real ceiling on growth; if you're looking for big subsidies, weapons and agribusiness are close to their ceilings already. weapons are probably going to see a good few years in the US due to the flagrant irresponsibility with stockpiles in Iran, but that's not the same as "growth"

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  • mccmcc@mastodon.social
    Nov 4, 2026, 11:00 PM

    @glyph Ah well so I think, in this conversation, the main thing I've been aiming for is the risks of "demand creating supply". Investment dollars chase something that doesn't exist, so that *something* is faked or manufactured.

    In the context of weapons, this idea becomes very sinister. There is a ceiling on growth for weapons. But that ceiling can be moved, if someone can convince political leaders to do certain things. Eisenhower warned about this

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  • Glyphglyph@mastodon.social
    Nov 4, 2026, 11:07 PM

    @mcc that is definitely a risk. the bad news is that it is a structural feature of all political systems (Mao did this, as did Stalin; it's not particularly a "capitalism" thing). the other bad news is that we have a cohort of like 9 psychopaths who can do this more or less independently right now.

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  • Glyphglyph@mastodon.social
    Nov 4, 2026, 11:08 PM

    @mcc the good news is that those psychopaths' power is much more precarious than it seems, and quantitatively they've lost about 20% of it in the last 2 days. qualitatively, probably more. and the more good news is that _structurally_ the AI bubble specifically is going to be disproportionately routing the high-risk/high-reward financial structures. it's going to hit everyone but it's going to hit VC *super* hard because all their bets will fail correlated

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  • 01d5501d55@mastodon.social
    Nov 4, 2026, 11:22 PM

    @mcc It is one thing to try to move the ceiling. It's another to plan around the ceiling being moved at a continuously increasing rate. Another source of difficulty: The "serve predatory business" party is also the "fanatical opposition to increased taxes" party.

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  • mccmcc@mastodon.social
    Nov 4, 2026, 10:55 PM

    @glyph so i think the problem is, gambling hacks human decisionmaking. as long as high risk high reward exists, there will be (1) people who take that option when they really shouldn't and (2) people who are looking for ways to repackage it as low risk high reward. Somewhere there's a "firm" or a "portfolio manager" who promises stable 8% returns where 4% is what a reasonable person would expect (made those numbers up) and of course customers go with him, and he's really just laundering gambling

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  • mccmcc@mastodon.social
    Nov 4, 2026, 10:59 PM

    @glyph i think you can build a less pathological investment environment than we've been living within but i don't know if you can get rid of the human tendency to create, and fall for, bernie madoffs

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  • Glyphglyph@mastodon.social
    Nov 4, 2026, 11:16 PM

    @mcc if all we had to worry about were Bernie Madoffs we'd be in reasonably good shape. SBF did some damage, but he's in prison functionally forever, where he should be. the problem is that we have a surfeit of Richard Fulds as well. Rational actors doing allowable things within the rules, never quite doing fraud, but, you know. Are you really "not doing fraud" if you're telling the risk officer to leave the room while you discuss your plans.

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  • Glyphglyph@mastodon.social
    Nov 4, 2026, 11:16 PM

    @mcc anyhow I have some ideas about how to organize financial markets and I should probably write them down

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  • Lou.gkrnours@mastodon.gamedev.place
    Nov 5, 2026, 9:10 AM

    @glyph @mcc in "solar power finance without the jargon", one part that stuck with me is instrundnt used to get money from the market to finance solar power plant. The idea is simple, investing in a power plant is pretty low risk but your money is frozen there. So if you go through an instrument, your return is tied to stock you can resell. In europe, they typicalled offered 4~5% return and are still around. In the US, closer to 6~8% and are mostly gone.
    Too much greed.

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  • mccmcc@mastodon.social
    Nov 4, 2026, 11:30 PM

    @glyph Bernie Madoff to Elizabeth Holmes to Sam Altman is a smooth continuum

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  • Dr. Bruce Simpsonbms@bsd.cafe
    Nov 5, 2026, 11:06 AM

    @mcc @glyph Madoff was adjacent to Corzine. I was approached about coming to work for MF Global in Toronto after my spell in HFT and algo-trading. I refused. A few months later in November 2011, exactly 15 years ago, having just started my PhD, I listened to BBC Radio 4 documenting their downfall.

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  • CMPRRSN RTFCTJoshuaACNewman@xeno.glyphpress.com
    Nov 4, 2026, 11:03 PM

    @glyph @mcc
    Movie studios have definitely stopped being like this.

    And this is possible. We should o everything in our priority to make it possible for the culture to be generated by people whose abilities generate culture.

    But also, I’m not expecting it to happen. For one thing, that would be a huge resource flow toward Black Americans, and we know how America feels about that.

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  • mccmcc@mastodon.social
    Nov 4, 2026, 11:31 PM

    @JoshuaACNewman @glyph Movie studios may have stopped being the high-risk high-reward sites, but isn't that just because *streaming services* became the high-risk high-reward sites? Leading to the boom and then bust in the creative industries over the last ten years?

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  • CMPRRSN RTFCTJoshuaACNewman@xeno.glyphpress.com
    Nov 5, 2026, 12:51 AM

    @mcc @glyph
    It’s because movie studios became Chinese-owned by investors, and the Chinese market with its censorship requirements became the primary market.

    Streaming services are definitely a growth over profit market, yes, but I think they’re owned by the same forces.

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