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There’s Nothing to Do Except Gamble

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Re: There’s Nothing to Do Except Gamble

#161

Post by isoskeles »

m3ta4a wrote: post #114
isoskeles wrote: post #96

Earlier quoted context omitted.

Even without capitalism, you have a duty to create value for the people around you, and you might expect the same of them. There are exceptions for the young, old, and infirm.

In no world where there is a "duty" to provide value am I going to be found happily providing value. In this world, in my experience, your statement is simply false. If I happen to provide some form of value it is from my choosing to, not to satisfy the demands of some formless "duty".

The "duty" is to satisfy the demands of existing within a community of people, where able-bodied freeloaders are never welcome. But I can understand nitpicking over semantics. Replace the word "duty" with whatever you want.

Re: There’s Nothing to Do Except Gamble

#162

Post by jpdus »

diamondhandle wrote: post #26

Our job in life is to engage in value creation. When money is decoupled from value creation, your long-term bet is that it will lose its value, as value creation is what actually matters in the “real” world. This is also why “crypto” (the asset class, not technology) is so corrosive, because it makes people who have done approximately nothing to create value in society, but who’ve enjoyed a massive boost in monetary…

What you call "corrosive" (appreciation of non-value-creating assets) is 1:1 applicable to Real Estate.

Compared to the appreciation of worldwide real estate, the market value of crypto is only a drop in the ocean. And countless people got unbelievable rich due to rising prices and "crowding-out" in cities without creating any value for society at all (in the opposite, making life harder for everybody struggling to keep up with their rent).

And nobody so far managed to explain convincingly, in which ways investments in (existing, residential, not for self-use) real estate creates any value. People don't by these assets b/c they provide better service or can run their properties more efficiently than someone else. They buy these assets b/c its risk-free return on the backs of tenants who need a place to live. In this aspect, Real Estate investors are arguably way worse than Crypte gamblers. But I agree that the rent-seeking behavior we see in more and more parts of our economy and our society is indeed corrosive in the longterm....

Re: There’s Nothing to Do Except Gamble

#163

Post by stouset »

jayd16 wrote: post #95
Al-Khwarizmi wrote: post #78

Financial elites have been gambling for decades. They seem to be really upset that the plebs now can also do it. When brokers did it it was OK, when algorithms did it in milliseconds (when common people can only operate with delays of hours and days, and with deterrent fees) it was OK, but now that there are platforms that allow more or less anyone to speculate, we start publishing moralistic pieces in the media and…

>Financial elites have been gambling for decades. They seem to be really upset that the plebs now can also do it. I really don't understand this sentiment, as if a professional gambler would not gladly gamble with novices...but putting that aside... I think the emphasis is more about how there's no other game in town that can compete, not that gambling is new. Interest rates are so low that there isn't a simple/safe…

Well of course there’s no “safe” 10% investment. That’s true across the board! Higher returns correlate with higher risk (otherwise a smart investor would pick the investment with the same returns and less risk).

That aside, you know what’s averaged returns of 10% that’s simple and hasn’t risked your money going to zero (assuming you have the good sense to buy and hold)?

The stock market. Bog-standard index funds, available to anyone and everyone. VTSAX has returned just about 10% since Jan 1, 2000. Ironically, it’s about double that for the past ten years (since the recession caused it to be roughly even over the first ten years of that span).

The average person doesn’t need to gamble on options to get ahead. They already do have access to products with outsize returns compatible with a level of risk tolerable for one’s retirement nest egg. What we need are jobs that allow the average wage-earner to actually save a meaningful amount of money in these instruments.

Re: There’s Nothing to Do Except Gamble

#164

Post by LargeWu »

wallacoloo wrote: post #137
LargeWu wrote: post #103

Earlier quoted context omitted.

If you think about the difference between "investing" and "speculating" (ie. gambling), the latter involves no actual value creation, just transfer of assets based on outcomes the speculating party has no influence over. Crypto, meme stocks, penny stocks...just pure speculation. To be fair, hedge funds and HFT are also mostly speculation, just a more sophisticated version.

Do I create value when I loan another person some asset? What about when I act as a currency exchange, and offer at any moment in time to take either side of any trade along with a 0.3% fee? These are two things I do on Ethereum right now which have analogs in the traditional finance system. Seems to me it matters little whether the activity is done in a traditional space or in cryptoland: they either both create val…

Loans would be one of the classic value creating activities, because they allow others to use otherwise idle capital to produce something new.

Currency exchange is fuzzier. If the exchange is happening to facilitate commerce, then sure, I would consider that value creation. If it's happening simply in order to support speculation in a different currency, then no, it's not value creating. And it's pretty clear from the data that the vast majority of crypto transactions are just glamorized forex trading - ie buying in order to hopefully sell later at a higher price. Add in the detrimental environmental externalities from crypto mining and you could even make the argument that crypto currency exchange actually creates negative value.

Re: There’s Nothing to Do Except Gamble

#165

Post by CodeMage »

jayd16 wrote: post #95
Al-Khwarizmi wrote: post #78

Financial elites have been gambling for decades. They seem to be really upset that the plebs now can also do it. When brokers did it it was OK, when algorithms did it in milliseconds (when common people can only operate with delays of hours and days, and with deterrent fees) it was OK, but now that there are platforms that allow more or less anyone to speculate, we start publishing moralistic pieces in the media and…

>Financial elites have been gambling for decades. They seem to be really upset that the plebs now can also do it. I really don't understand this sentiment, as if a professional gambler would not gladly gamble with novices...but putting that aside... I think the emphasis is more about how there's no other game in town that can compete, not that gambling is new. Interest rates are so low that there isn't a simple/safe…

> I really don't understand this sentiment, as if a professional gambler would not gladly gamble with novices...

"Professional" and "expert" aren't synonyms. "Amateur" and "novice" aren't synonyms either.

An expert might be glad to go against a novice. But when there are artificial barriers separating "professionals" from "amateurs", barriers that have nothing to do with level of expertise, that's a different story.

Re: There’s Nothing to Do Except Gamble

#166

Post by ouid »

jayd16 wrote: post #95
Al-Khwarizmi wrote: post #78

Financial elites have been gambling for decades. They seem to be really upset that the plebs now can also do it. When brokers did it it was OK, when algorithms did it in milliseconds (when common people can only operate with delays of hours and days, and with deterrent fees) it was OK, but now that there are platforms that allow more or less anyone to speculate, we start publishing moralistic pieces in the media and…

>Financial elites have been gambling for decades. They seem to be really upset that the plebs now can also do it. I really don't understand this sentiment, as if a professional gambler would not gladly gamble with novices...but putting that aside... I think the emphasis is more about how there's no other game in town that can compete, not that gambling is new. Interest rates are so low that there isn't a simple/safe…

You haven't argued this, but there should never be an opportunity for safe passive income that scales with your wealth.

Re: There’s Nothing to Do Except Gamble

#167

Post by LargeWu »

dehrmann wrote: post #136
LargeWu wrote: post #103

Earlier quoted context omitted.

If you think about the difference between "investing" and "speculating" (ie. gambling), the latter involves no actual value creation, just transfer of assets based on outcomes the speculating party has no influence over. Crypto, meme stocks, penny stocks...just pure speculation. To be fair, hedge funds and HFT are also mostly speculation, just a more sophisticated version.

HFT is usually arbitrage, almost the opposite of speculation.

Fair enough, although one can make a reasonable argument that arbitrage is not a value creating activity either, if the market is already reasonably efficient.

Re: There’s Nothing to Do Except Gamble

#168

Post by onlyrealcuzzo »

paulpauper wrote: post #13
jp555 wrote: post #4

Zero mention of the recent unprecedented fiat currency printing we've seen, nor the fact that every time since the Tang Dynasty when we have done this, it has led to very troubling times 12-18 months later. Everyone is gambling even if they dont know Crypto exists.

then how come the US economy boomed after 2009 in spite of unprecedented stimulus and other programs. Not saying that the programs caused the expansion, but it did not seem to hurt it either. Everyone who said that the printing would cause inflation, a repeat crisis, recession, or other problems, were wrong.

Doing great if you're on the part of the K that's going up - not down.

Re: There’s Nothing to Do Except Gamble

#169

Post by isoskeles »

the_local_host wrote: post #123
isoskeles wrote: post #96

Earlier quoted context omitted.

Even without capitalism, you have a duty to create value for the people around you, and you might expect the same of them. There are exceptions for the young, old, and infirm.

> Even without capitalism, you have a duty to create value for the people around you I don't think this is true. This is one of these work ethic corollaries that helped build wealthy societies when productivity was proportional to people's effort. But it seems to grow more obsolete by the day.

Do you think that early hunter-gatherers shared their food with people who did not participate in acquiring food?

Without capitalism, we could regress to the most primitive version of civilization and still require contribution to the tribe. The alternative is to go off on your own (and at that point, there are no "people around you" to help). Less primitive alternatives, as different political-economic systems, usually still require you to contribute through taxation.

Re: There’s Nothing to Do Except Gamble

#170

Post by mLuby »

whatgoodisaroad wrote: post #68

Weird how finance suddenly becomes "gambling" when a bunch of regular people join the table.

Yeah, it gets harder to believe there's "smart money" when your friend Alice made bank following some meme stock and Bob down the road became crypto-rich off Dogecoin.
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