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Embrace Complexity; Tighten Your Feedback Loops

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Re: Embrace Complexity; Tighten Your Feedback Loops

#41

Post by slt2021 »

Chrisoaks wrote: post #40
slt2021 wrote: post #35

Earlier quoted context omitted.

^ I don't think professional plumbers and accountants exchange services in kind for a living, last time I checked people use this thing called currency. and this makes the zero sum, since the money plumber pays accountant, is the money he cannot spend on other things like groceries and vise versa.

Sounds like you’re recognizing that the example is positive sum. And bringing currency into the equation doesn’t change the fact that the plumber is better off for engaging in the trade. Not all ways of spending money create the same value. He could also spend the money by burning it, which would be negative sum.

It is not positive sum, in competitive market it is basically exchanging services, and each party has to agree on mutual value of services being exchanged otherwise no trade.

Accountant values his labor as 100/hr and plumber values his services as 100/hr and they simply exchanche services.

How is it positive sum?

Re: Embrace Complexity; Tighten Your Feedback Loops

#42

Post by edmundsauto »

AndrewKemendo wrote: post #38
edmundsauto wrote: post #36

Earlier quoted context omitted.

RSUs that you can sell are effectively cash, not a lotto ticket.

They depend on the stock which is totally unpredictable For example, literally the day before I started at my last company, their stock went from $120 to $40 So yes it’s a lotto ticket

I just… sell the stock when it vests? I guess I can see your pov is consistent as long as you consider every stock as a lotto ticket, but I don’t think that’s the typical opinion.

Re: Embrace Complexity; Tighten Your Feedback Loops

#43

Post by admax88qqq »

slt2021 wrote: post #27
admax88qqq wrote: post #26

Earlier quoted context omitted.

> Now we know that IT is a growing market, That's literally a non zero sum game. You can phrase it as cynically as you like, but that's still the definition of a non zero sum game.

it is zero sum when it comes to Labor vs Capital relationship. Counter example to your claim: if giving out RSUs is not zero-sum, then why don't Companies give me as many RSUs as possible, since they are not losing anything and it is not zero-sum game, by your definition?

That is a purposefully bad take of "my definition"

Sure the RSUs available today are zero sum. The company has a finite value today, and thus your share of the compensation available today is a zero sum game across every participant in the corporation.

But your compensation _over time_ is not zero sum, as the value of the company can grow, both within the current market and as the current market grows _by your own definition._

Re: Embrace Complexity; Tighten Your Feedback Loops

#44

Post by slt2021 »

admax88qqq wrote: post #43
slt2021 wrote: post #27

Earlier quoted context omitted.

it is zero sum when it comes to Labor vs Capital relationship. Counter example to your claim: if giving out RSUs is not zero-sum, then why don't Companies give me as many RSUs as possible, since they are not losing anything and it is not zero-sum game, by your definition?

That is a purposefully bad take of "my definition" Sure the RSUs available today are zero sum. The company has a finite value today, and thus your share of the compensation available today is a zero sum game across every participant in the corporation. But your compensation _over time_ is not zero sum, as the value of the company can grow, both within the current market and as the current market grows _by your own de…

Question to you: why shareholders are giving out RSUs in the first place? Are they doing it out of kindness of their heart?

If you look at the whole picture, you will see that “to align employees with company goals” is simply “to incentivize employees to make shareholders richer”.

Shareholders usually own 90+% of the stock, while employees ownership is in single percentages at best. That includes early employees.

The deal for Capital is very simple: give away few percents of stock and make Labor grind tirelessly to increase value of Capital by orders of magnitude.

Percentage wise everybody wins, both Labor and Capital (so called not zero sum game), in absolute terms however the distribution tells a different story.

Another counter-example: Imagine startup fails or is acquired at decreased valuation: will be it zero sum or not?

Well, employees options are wiped out first, VC capital gets first claims to money pool, Founders have second claims after VCs (or would have made liquid in separate deals), while regular employees are the ones who screwed.

Re: Embrace Complexity; Tighten Your Feedback Loops

#45

Post by slt2021 »

edmundsauto wrote: post #42
AndrewKemendo wrote: post #38

Earlier quoted context omitted.

They depend on the stock which is totally unpredictable For example, literally the day before I started at my last company, their stock went from $120 to $40 So yes it’s a lotto ticket

I just… sell the stock when it vests? I guess I can see your pov is consistent as long as you consider every stock as a lotto ticket, but I don’t think that’s the typical opinion.

Problem with this approach is RSU grant price is fixed at when you join the company.

You could sign job offer with $1M in RSUs at $100/sh for 10k shares, but you would have vested only $500k worth of shares if price decreases to $50/sh a year after, when you reach cliff vest

So selling at vest does not decrease your risk between RSU grant date and vest date

Re: Embrace Complexity; Tighten Your Feedback Loops

#46

Post by Chrisoaks »

slt2021 wrote: post #41
Chrisoaks wrote: post #40

Earlier quoted context omitted.

Sounds like you’re recognizing that the example is positive sum. And bringing currency into the equation doesn’t change the fact that the plumber is better off for engaging in the trade. Not all ways of spending money create the same value. He could also spend the money by burning it, which would be negative sum.

It is not positive sum, in competitive market it is basically exchanging services, and each party has to agree on mutual value of services being exchanged otherwise no trade. Accountant values his labor as 100/hr and plumber values his services as 100/hr and they simply exchanche services. How is it positive sum?

Because the price paid is somewhat less than the value derived. You might have been willing to pay him $110 and he might have been willing to walk away with $90. But regardless of whether you settle on a rate of $90 or $110 or split the difference at $100, a $20 positive sum is created.

You mention competitive markets, where surplus is reduced or almost eliminated. But most markets do not reach such a late stage level of optimization.

Re: Embrace Complexity; Tighten Your Feedback Loops

#47

Post by admax88qqq »

slt2021 wrote: post #44
admax88qqq wrote: post #43

Earlier quoted context omitted.

That is a purposefully bad take of "my definition" Sure the RSUs available today are zero sum. The company has a finite value today, and thus your share of the compensation available today is a zero sum game across every participant in the corporation. But your compensation _over time_ is not zero sum, as the value of the company can grow, both within the current market and as the current market grows _by your own de…

Question to you: why shareholders are giving out RSUs in the first place? Are they doing it out of kindness of their heart? If you look at the whole picture, you will see that “to align employees with company goals” is simply “to incentivize employees to make shareholders richer”. Shareholders usually own 90+% of the stock, while employees ownership is in single percentages at best. That includes early employees. The…

You can't say that some outcomes are zero sum and other outcomes are not. By the very fact that there are different possible outcomes proves it is not a zero sum game.

> Imagine startup fails or is acquired at decreased valuation: will be it zero sum or not?

It's not zero sum, the total sum changed over time as the company lost value. Non zero sum doesn't mean "value only goes up"

> Percentage wise everybody wins, both Labor and Capital (so called not zero sum game), in absolute terms however the distribution tells a different story.

Thank you for conceding my point. It is a non zero sum game. There's an argument to be made about that employees are not given their fair share of RSUs or options, but that is a wholly separate argument/debate and you weaken your point by trying to say it's a zero sum game.

Re: Embrace Complexity; Tighten Your Feedback Loops

#48

Post by TheCowboy »

paulryanrogers wrote: post #17
TheCowboy wrote: post #14

Earlier quoted context omitted.

I've often encountered software that feels like it was designed by people who don't have to use it to do work, and not necessarily because they're engaging in class conflict (though it can certainly appear that way based on the painfully flawed software people can be forced to tolerate). The worst system was a DOS-based point-of-sale system in a restaurant---kept around way beyond the 'age of DOS'. The main gimmick i…

Ironic since my experience during the transition away from ASCII displays and shortcut inputs is that the touch screens and deep menus were slow. Touch won because it was more approachable, at least for the shallowest options

Touch is fine when done right with responsive hardware. I'm not making a blanket statement about if touch is good or bad. This was just a poorly designed UI and software. Additionally, the light pens could be prone to error due to dirt and grime.

Re: Embrace Complexity; Tighten Your Feedback Loops

#49

Post by adave »

slt2021 wrote: post #18
chrisdbanks wrote: post #8

Earlier quoted context omitted.

Workers vs investors shouldn't be seen as a zero sum game. If it is then that's short-term thinking. Simon Sinek explains this all very well in The Infinite Game.

Any non-zero sum game can be re-formulated in zero-sum game terms, this is a rule. Give me example of any non-zero sum game, and I can prove that under the hood it is actually a zero-sum game. The trivial proof is that profit/revenue pool available for Corporation is limited, and the main question is how that profit pool is to be divided among Labor (employees) and Capital (investors/shareholders). The fundamental la…

USA literally creates money out of thin air, there is no upper cap as they keep extending the ceiling.

This is how we have a CEO making $100b from a single company stock which would be impossible if it were a zero sum game.

Hype which is even more rarefied air, can create so much money without taking anything from the customers. Silicon Valley VC's create valuations for companies out of thin air and then triple it even without anyone ever seeing that money.

Attention which is unlimited in a way is a new form currency, which is why you see platforms being built up to get more eyeballs.

The rule you mentioned comes into play when taking into account players in the game i.e any game where you can add more players is guaranteed to become zero sum.

In real world situations where cooperation is needed, we mostly have a non zero sum game.For ex - https://cs.stanford.edu/people/eroberts/courses/soco/project...

Re: Embrace Complexity; Tighten Your Feedback Loops

#50

Post by slt2021 »

adave wrote: post #49
slt2021 wrote: post #18

Earlier quoted context omitted.

Any non-zero sum game can be re-formulated in zero-sum game terms, this is a rule. Give me example of any non-zero sum game, and I can prove that under the hood it is actually a zero-sum game. The trivial proof is that profit/revenue pool available for Corporation is limited, and the main question is how that profit pool is to be divided among Labor (employees) and Capital (investors/shareholders). The fundamental la…

USA literally creates money out of thin air, there is no upper cap as they keep extending the ceiling. This is how we have a CEO making $100b from a single company stock which would be impossible if it were a zero sum game. Hype which is even more rarefied air, can create so much money without taking anything from the customers. Silicon Valley VC's create valuations for companies out of thin air and then triple it ev…

thank you for your comment, your points are valid
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