How the free market is like an orgy, or The Invisible Hand.
Why was i thinking about this? I was thinking about questions people don't ask - about why sports is so valuable, and hence sports figures make so much money, and then i started thinking about Market-driven value and...
Yeah. What is up with maket-driven value? The idea that Lebron James is worth what people are willing to pay him. Every actor is rational, doing a calculation of financials, deciding how much he would bring to them and then deciding how much they are willing to pay. And then factoring the loss that this zero sum game entails: if you don't get him, your competitor will. So, hence LeBron's value is enormous both in what it grants you and what it protects you from losing. Then you factor in what you are capable of paying. And that's where it gets dicey.
Say LeBron brings $50 million of revenue this year. Then you can pay him $40 and make a profit. Except the New York Knicks are going to offer him $100 million, because they'll bring him much more money (because of ticket prices, merchandising, cable tv, advertising money) than he would bring you, and they have the financial flexibility to pay $100 million now to get $1 Billion later.
Now, market-driven value says that there is no need for an external fixed source to step into this, because the market will correct itself. People who spend too much, take on too much risk, and it backlashes; corrections are made. It is the 'Invisble Hand' moving and automatically, organically keeping all the actors in the same chapter, if not on the same page.
I've always thought this didn't work. Mostly my point has been about entrenched - in essence, i believe that some firms are too big to be affected by the invisible hand. I'm clearly wrong in a post-Lehman Bros world. But I kept thinking about this invisble hand, and i started to think about orgies.
Have you ever been in an orgy? A post-foursome group of sexual adults? I haven't. For a good reason. I don't like invisible hands. In any sexual grouping more than four, I'd imagine that a sort of haze colors everything. Things happen, a moment flowing from one to the next, kissing to sucking to licking to moving around to anything. Things happen.
It's not entirely unusual to have something in your mouth, some things in your hands, and someone at your feet, and then - where...what..how...who is that? What is this feeling I can not see, but feel.
It's the invisible hand. Doing stuff you can't see, but that affects you. And yes, maybe it got you off, but...who was it? Is that what i wanted? Do we really want to be in a spot where shit just happens? Where dicks go inside you before you decide you wanted that, where something envelops you without you noticing? The Invisible Hand, in it's role of silent partner, is making stuff happen organically, but outside of any individual control. It's a series of singular unconnected events that together create a process. And not a process that is innate rational or beneficial - only one that is effective in the minimal goals of satisfaction. The little shit like clean-up, forethought, sustainability or group satisfaction don't matter to the invisible hand. The free market doesn't give a shit about 50 years from now, it cares about the satisfaction of the now, and really only an implicit show of faith on our part leads us to believe that a series of short-term choices based on short term needs leads us to future good times.
And so that process fucks you when you want to be sucked, or rims you when you want to be kissed. And often, you'll get fucked and say "great! thats what i wanted!" but that's almost just a coincidence. And nothing in there says that it fucks you the way you want to be fucked, or prepares you for the next person, or event, or life. The Invisible Hand moves a project back and forth between extremes, with possible a slight forward lean, but only in the basics - no one will get too rough, no one will just lay there, no one will be a bad actor, but what about all the secondary and tertiary goals? The little stuff that is necessary for true satisfaction, but no individual actor thinks about "in the moment?"
A government or some other sensible outside force wouldn't let the chips fall where they may - they'd, if responsible, would question the actors on their wants and needs, refer to an established body of process and expectation, look ahead to a future party, and then guide the process in that direction. It'd, the the best of possibility, make sure that those that want to get off, get off, those that need to get fucked, get fucked, and those that want to watch, fucking clean up after.
Any successful orgy (not that i've, um, been to any) or market requires a stable constant party or infrastructure, to make sure the clothes are bagged and separated neatly, the drinks and crackers are fresh, the porn in the dvd is appropriate, and, after the sex is long past, plans the next party.
It's a good thing, regulation.
Yeah. What is up with maket-driven value? The idea that Lebron James is worth what people are willing to pay him. Every actor is rational, doing a calculation of financials, deciding how much he would bring to them and then deciding how much they are willing to pay. And then factoring the loss that this zero sum game entails: if you don't get him, your competitor will. So, hence LeBron's value is enormous both in what it grants you and what it protects you from losing. Then you factor in what you are capable of paying. And that's where it gets dicey.
Say LeBron brings $50 million of revenue this year. Then you can pay him $40 and make a profit. Except the New York Knicks are going to offer him $100 million, because they'll bring him much more money (because of ticket prices, merchandising, cable tv, advertising money) than he would bring you, and they have the financial flexibility to pay $100 million now to get $1 Billion later.
Now, market-driven value says that there is no need for an external fixed source to step into this, because the market will correct itself. People who spend too much, take on too much risk, and it backlashes; corrections are made. It is the 'Invisble Hand' moving and automatically, organically keeping all the actors in the same chapter, if not on the same page.
I've always thought this didn't work. Mostly my point has been about entrenched - in essence, i believe that some firms are too big to be affected by the invisible hand. I'm clearly wrong in a post-Lehman Bros world. But I kept thinking about this invisble hand, and i started to think about orgies.
Have you ever been in an orgy? A post-foursome group of sexual adults? I haven't. For a good reason. I don't like invisible hands. In any sexual grouping more than four, I'd imagine that a sort of haze colors everything. Things happen, a moment flowing from one to the next, kissing to sucking to licking to moving around to anything. Things happen.
It's not entirely unusual to have something in your mouth, some things in your hands, and someone at your feet, and then - where...what..how...who is that? What is this feeling I can not see, but feel.
It's the invisible hand. Doing stuff you can't see, but that affects you. And yes, maybe it got you off, but...who was it? Is that what i wanted? Do we really want to be in a spot where shit just happens? Where dicks go inside you before you decide you wanted that, where something envelops you without you noticing? The Invisible Hand, in it's role of silent partner, is making stuff happen organically, but outside of any individual control. It's a series of singular unconnected events that together create a process. And not a process that is innate rational or beneficial - only one that is effective in the minimal goals of satisfaction. The little shit like clean-up, forethought, sustainability or group satisfaction don't matter to the invisible hand. The free market doesn't give a shit about 50 years from now, it cares about the satisfaction of the now, and really only an implicit show of faith on our part leads us to believe that a series of short-term choices based on short term needs leads us to future good times.
And so that process fucks you when you want to be sucked, or rims you when you want to be kissed. And often, you'll get fucked and say "great! thats what i wanted!" but that's almost just a coincidence. And nothing in there says that it fucks you the way you want to be fucked, or prepares you for the next person, or event, or life. The Invisible Hand moves a project back and forth between extremes, with possible a slight forward lean, but only in the basics - no one will get too rough, no one will just lay there, no one will be a bad actor, but what about all the secondary and tertiary goals? The little stuff that is necessary for true satisfaction, but no individual actor thinks about "in the moment?"
A government or some other sensible outside force wouldn't let the chips fall where they may - they'd, if responsible, would question the actors on their wants and needs, refer to an established body of process and expectation, look ahead to a future party, and then guide the process in that direction. It'd, the the best of possibility, make sure that those that want to get off, get off, those that need to get fucked, get fucked, and those that want to watch, fucking clean up after.
Any successful orgy (not that i've, um, been to any) or market requires a stable constant party or infrastructure, to make sure the clothes are bagged and separated neatly, the drinks and crackers are fresh, the porn in the dvd is appropriate, and, after the sex is long past, plans the next party.
It's a good thing, regulation.