It can be argued that long-term thinking is already part of the current market structure, for example take Amazon or Tesla which trades at extraordinary PE ratios. In essence investors are betting in the far future these companies will make money. How does the long term stock exchange differ?
The Long-Term Stock Exchange Opens for Business
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Re: The Long-Term Stock Exchange Opens for Business
#392Congratulations. "We shape our buildings; thereafter they shape us." -- Winston Churchill Though I barely understand such things, I'm very excited by your LTSE and Katsuyama's Investors Exchange (IEX). Listening to your interviews about LTSE, my takeaway is that your goal is to allow companies to be judged on their own merits, instead of someone else's. So one side effect may be to help migrate private equity funded…
> I hope others see that our markets are designed. They are human artifacts. They are not natural laws to be accepted as-is. “Markets” are not the same thing as “the market”. Markets are human artifacts; the market is an emergent behavior. It’s governed by laws beyond our control as surely as the behavior of materials are governed by thermodynamics. If the behavior of your markets fails to match the reality of the ma…
The way you've put this bears more resemblance to religion than anything else.
"Markets" are real things. I can walk to them, or navigate to their website, or call them up.
You are claiming that there is an invisible, metaphysical "the market", which exists in the Platonic world of forms, that governs the behavior of these genuine markets.
This is like reading "The Gods of the Copybook Headings", and founding a religion which worships and offers sacrifice to those gods!
This "the market" you refer to is an abstraction of the behavior of real markets. It can give us all sorts of guidance as to what will happen when various rules are applied, or not, to these real markets; but comparing these broad heuristic rules to thermodynamics has me suspecting you don't understand either thermodynamics nor macroeconomics.
Every market has rules. Invariably, you are not allowed to stab a vendor and take their stuff. Sometimes there are things you can't sell; sometimes only Dutch auction is allowed, and so on ad infinitum.
This is simply a market with different rules from those governing other stock markets. We're all free to speculate on the consequences those different rules will have; perhaps they will summon literal Gods of the Copybook Headings, which will return upon us with actual terror and slaughter.
The safe bet is that prediction and reality will be divergent. This is economics, not thermodynamics, after all.
Re: The Long-Term Stock Exchange Opens for Business
#393Earlier quoted context omitted.
Can you explain what this means?
I'll try: The charter governs the relationship of the company to its investor. A share of stock is a contract between those parties. The charter controls what the stock "means" no matter where it trades.
If I've understood the intent correctly, the individual investor side of LTSE is only a small part of the picture. The biggest part is that the company itself is setup for long-term focus via its principles[0] -- as one example, compensating executives not based solely on hitting a single quarter's numbers, but on performance over the long term.
So long as a company adheres to those principles, it doesn't matter if an individual investor can obtain their shares via ShortTermScumbags.com or the like. Having investors who are along for the long haul is a nice-to-have, not a must-have, since the goal is long-term focused companies which will naturally, via its principles, eschew reacting to short-term trends in share price.
Re: The Long-Term Stock Exchange Opens for Business
#394I don't have any questions, I just wanted to mention that I think you're changing the world more than most people realize.
Thank you! I don’t mind being misunderstood for long periods of time, that kind of goes with the territory. But still, it’s nice to get a shot in the arm every once in a while
Opening a new exchange is a huge achievement. Congrats on making it over all of the regulatory (and other) hurdles!
I wish you the best of luck in attracting new listings; it's a fascinating idea.
Re: The Long-Term Stock Exchange Opens for Business
#395What are the benefits for a company to list here? What are the current examples of company that exists now that fit that ideal long-term vision?
I expect they'll find capital from investors/shareholders there that will be less activistic in periods of short-lasting economic underperformance
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Re: The Long-Term Stock Exchange Opens for Business
#396Earlier quoted context omitted.
This isn't known to be true. In terms of computational complexity, market clearing is PPAD ( https://en.wikipedia.org/wiki/PPAD_(complexity) ). It may turn out that PPAD is computationally tractable even if P != NP, though it is thought to be unlikely.
I would argue that reinforces my point rather than weaken it. My point being that the market is an understandable thing becomes more reasonable if it turns out it's not even an intractable problem that we are discussing. But I also think you are misunderstanding the argument I was replying to in the first place, because a lot of the claims about "the market" are about the second order allocation of resources that mar…
> The claims about "the market" are market fundamentalism, that the market is the ideal allocation structure, that we can't find a better or even equivalent solution, because that's just how good markets are.
It's more usual to accept a weaker claim: that markets are the most efficient approximation to the perfect algorithm for price discovery, that is, they are the best way we know of to approximate perfect pricing given the constraint of time.
Insisting that no better approach is possible is a strong claim; you'll find it in the wild, but it's always dicey to make confident predictions about the future of human ingenuity.
But at the same time, there's no reason to waste much breath on technology which doesn't exist: markets are what we have, and they're what we should use, with the burden of proof firmly on the inventor of anything new to demonstrate that it has greater efficiency.
Re: The Long-Term Stock Exchange Opens for Business
#397I wonder what the actual business model for the company is and how the incentives from this will affect the LTSE vision behind "long-term investing". As far as I have seen on the website the company runs various freemium SaaS products like captable.io, startuprunway.io and hiringplan.io. They obviously want or need to monetize on that. edit links: - https://captable.io - https://startuprunway.io - https://hiringplan.…
yuuuup it feels like the third page in the godaddy checkout flow where it's like 'maybe you need our wordpress, email, and VPS hosting in order to launch your website' also feels like a data grab. traditional exchanges don't collect this stuff, and the SEC doesn't collect most of it.
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Re: The Long-Term Stock Exchange Opens for Business
#398What are the benefits for a company to list here? What are the current examples of company that exists now that fit that ideal long-term vision?
I expect they'll find capital from investors/shareholders there that will be less activistic in periods of short-lasting economic underperformance
Are they going to limit the volum of the transactions, or it's trusting the investors.
It would be better if they gave more details on it.
Re: The Long-Term Stock Exchange Opens for Business
#399@eries any plans/timeline to list LTSE on LTSE?
Also any additional thoughts on the index fund proposal described by a few here: would you want to include existing public companies or only completely brand new LTSE listed companies?
Thanks
Re: The Long-Term Stock Exchange Opens for Business
#400Not all good ideas make good businesses.