“Play-to-Earn” and Bullshit Jobs

> Runescape has a robust economy where every action can be measured in gold and experience per hour (when played efficiently). Someone might be buying magic logs for gold because cutting them down is a poor choice for them from an opportunity cost perspective (i.e. they can make more gold per hour via other activities their character has access to).

I don't think this holds up when real-world money enters the equation. I don't think this can be accurately descriped as player optimization or class specialization if people are paying real money to skip it.

> they can make more gold per hour via other activities their character has access to

If this was actually true, no real-world money would be entering the system, because all of the players would be making enough gold in-game via those other activities to pay for the logs. If they're being forced to spend real-world money, then the other activities they're engaged with are not giving them enough gold to sustainably fund themselves in-game.

The problem isn't having an in-game economy, in-game economies are great. The problem is people paying to get rid of gameplay. People who do that are signaling very clearly that they believe there is monetary value in removing a section of gameplay from the game. Designers should pay attention to that signal.

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I don't doubt that there are people legitimately having fun playing Runecraft. But it can't be everyone, or else people would not pay $10 to remove less than a day's worth of grind.

Right. So exactly the same is true of stocks when it comes to trading existing stock. The key difference is the creation of stock - IPOs. The company uses that money they get from the IPO and invests it into the business, which results in profits, which they give out as dividends. There's no such mechanism in cryptocurrency.

Unfortunately the other side has a good response to this - if the dollar value of buybacks+dividends exceeds the dollar value of IPO's, then you end up with the same problem that Bitcoin is in, where it's a net loss system. That seems to be the case[0]. This is not a well known fact.

Ultimately this comes down to the fact that we don't have a stable velocity of dollars, and an unstable velocity that results in more dollars chasing less more goods produces speculative bubbles that must eventually crash and create recessions.

All investments, including all currency, whether it be stocks or gold or bitcoin or dollars, is inherently valueless. The only time you can calculate the value is when you actually are extracting utility. You can then work back from that to determine who produced that value.

[0, Figure 5/Figure 8]: https://www.yardeni.com/pub/buybackdiv.pdf

> Taking advantage of your roth, 401k, homestead exemption, writing off losses, etc… absolutely provides value to the tax payer. The value is literally more money for the tax payer who can now further participate in the economy.

But it's zero-sum - every dollar they gained was a dollar taken out of the public purse. And worse, hours of human labour were spent on this moving around rather than something productive.

Tax benefits are (notionally) intended to be positive sum, but that can only happen to the extent that they change actual behaviour. If I put more into a pension fund because it's tax-advantaged, that's (theoretically) win-win - I get more to spend in the long term, the government reduces the risk of having to support a penniless future me. Similarly if I buy a bicycle through the cycle to work scheme, that (on average) reduces the government's medical costs. But claiming a tax writeoff for something I was doing already is zero-sum, and changing my corporate structure so that it pays less tax while doing economically equivalent things is likely to be negative-sum (because the new structure will likely have (marginally) lower real-world productivity - otherwise I'd be doing it that way already).

> The accounting industry employs loads of people. Is that not “value?”

No, quite the opposite - it's taking those people away from things that are real-world productive. Sometimes the costs of accounting might be outweighed by the benefits (e.g. giving companies information they need to make business judgements, or exposing fraud earlier). But often they're not.

Yes. The stocks in the SP500 sometimes go down in value, sometimes in the aggregate for a long time. Individually some of them go down forever.

If a stock goes down in value and it still pays a dividend it becomes more valuable for this. Setting that aside all stocks have a not very senior claim on assets. As the stock goes down sometimes it is worth less than the assets it has a claim to. At that point its better to buy up a controlling interest and sell the assets. Thats what private equity does. So yes I am interested when the value goes down.

>but when I read the book a few years back, I was skeptical that any mechanism to create bullshit jobs could arise from a system as inherently Darwinian as capitalism.

Well, here's the problem: Darwinian doesn't mean evolution towards something specific (i.e. more efficiency).

In fact, regression (in certain skills, etc.) is just as likely (like cockroaches, not humans, being the fittest in a certain environment).

So, Darwinian, broadly and metaphorically speaking (like the author) just means more fitness for survival.

And this is totally compatible with BS jobs, when it comes to the survival of the overal system.

One specific attribute of capitalism today is also that it's always somebody else's money, what with public companies, and golden parachutes, and bailouts, and such - and the rise of pharaonic middle management.