61–70 of 115 posts
I was just thinking, maybe we should privatize the police force. And then when the police kill or maim another unarmed black man, we can sue them for securities fraud, for not providing the promised level safety of law enforcement. It sounds like a lot more justice than we're getting now.
Only for black men?
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Do you still have to be a share holder when you sue? Or can it play out like, I own xx shares in Y Corp. Y Corp does something bad and share price goes down, I sell my stake and sue Y Corp for securities fraud for making my shares go down during the time period I owned them?
Yes, that's how it works, except you would rarely sue yourself. I work for a hedge fund. Every year we send a list of all our transactions to a company. They recover money on our behalf from any legal action that may happen. These things take a long time though. We are still getting payouts from stuff that happened in 2014.
Is there an equivelent for a passive investor that just holds ETFs? Or does the fund already do it for me?
Its a manifestation of inequality.
Ideally, the structures would be arranged to naturally handle this better. For example, more sophisticated forms of high-tech money. Or more efficient legal systems.
Not an easy problem but I believe it is structural.
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> Economists like to talk about "utility" and the common good with their theories, but they tend to only measure money Yeah, that's the problem. The economic notion of value weights according to wealth while the moral notion of value does not. It's absolutely scandalous that we let economists conflate the two. Feed a starving kid in Africa? Zero economic value. The kid doesn't have money. Figure out how to merge toge…
I am an economist, and I have no idea what you're talking about.
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This is nonsense. It's not The Market™ or The System™. It turns out starving kids in Africa are of no value to anyone except to their parents, who have no means to provide commensurate to the child's value to them. The blunt truth is that arbitrary lives are probably nearly valueless and certainly worth less than $1000. I have tested this hypothesis by describing GiveWell's mathematics to people at varying stages bef…
I live nude in a barrel by a river, all I do is trade cryptocurrency on my phone collecting over 8 figures annually, and everything I don't spend on potatoes I donate to GiveWell. How could I save more lives?
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A securities fraud lawsuit against a company because the work environment is toxic reminds me of the movie Unforgiven. For those unaware, the movie starts with a cowboy disfiguring a prostitute with a knife because she laughed at him. After the incident, the guy who manages the brothel is financially compensated since he had invested money in bringing the prostitute to his place of business, money which he will presu…
Given this type of scenario, it feels like the opposite should happen: Investors should be blocked from recovering losses and victims should be compensated. That's a far better preventative measure.. to incentivise investors to be responsible in what they invest in rather than "just letting shit happen" and reclaiming money if necessary because it's easier. If harm comes to people due to their investment, they only g…
I think Levine's take is a bit more nuanced. It's not like shareholders are taking up the case for some altruistic reasons, it's just that for lawyers it's an easier case to litigate. To paraphrase Matt, if you had to sue the CEO, on behalf of victims, for sexual harassment, as a lawyer you would have to prove the damages by showing that maybe the CEO had a pattern, that the victim was actually traumatized and not just "regretting it" and any other of mountain of historically charged counter claims of sexual harassment. But securities fraud, all the lawyer has to do is point to a newspaper article about how the news came out and the stock went down.
In other words, investors being blocked from being compensated wouldn't solve the issue - it would just remove a possible disincentive for actors to act improperly.
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I am an economist, and I have no idea what you're talking about.
It is difficult to get a man to understand something, when his salary depends on his not understanding it.
This is probably showing up because it showed up in Matt Levine’s newsletter which returned today. In the newsletter, Matt disagrees with one of the conclusions drawn in the paper that shareholders have a perverse incentive to invest in companies that do bad things because they are compensated their loses when the stock goes down. He disagrees because their are compensated with money that the company has which alread…
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> Economists like to talk about "utility" and the common good with their theories, but they tend to only measure money Yeah, that's the problem. The economic notion of value weights according to wealth while the moral notion of value does not. It's absolutely scandalous that we let economists conflate the two. Feed a starving kid in Africa? Zero economic value. The kid doesn't have money. Figure out how to merge toge…
This is nonsense. It's not The Market™ or The System™. It turns out starving kids in Africa are of no value to anyone except to their parents, who have no means to provide commensurate to the child's value to them. The blunt truth is that arbitrary lives are probably nearly valueless and certainly worth less than $1000. I have tested this hypothesis by describing GiveWell's mathematics to people at varying stages bef…
Most people would say they place a high value on human life, but we don't know how true that is until we see what costs they're willing to incur in the name of helping others.