Exegesis - Cap/Com-ist

[Kidlicious]

You are purposefully not making any sense Flubber.

[Kidlicious]

Originally posted by Flubber
Just to be clear-- A risk premium IS an incentive to make a risky investment. That's why I have difficulty seeing you split it into two separate pieces. By definition a risk premium IS an incentive.

You're contradicting yourself. How can the premium be incentive if it only equals the risk cost?

[Flubber]

Originally posted by Kidicious


So if we don't pay the incentive then no projects take place. You don't seriously think that capitalism can continue if we don't pay the incentive do you?

What exactly is wrong about not paying the incentive, letting capitalism fail, and building a new system where the is no incentive necessary?

Free will, kid-- If you don't want to rent my tractor or apartment or whatever, then don't. Just don't be suprised that lots of others will rent stuff to their advantage ( they will make more and more money and wonder what all the "exploitation" crap is about).


My question is how do you not allow the businesses to profit. You need food and almost all that is available to a city dweller comes from businesses. I expect most of the agribusinesses and food conglomerates could outwait your decision not to purchase and when you do purchase, they will earn a profit.

You talk about this "incentive" like its something that people consciously decide to pay. They don't. People pay a price for their eggs and milk and cheese. . . and guess what . .. on some of those products a profit is made and others there is none and people don't care as long as it is a fair price for the item they are purchasing.


Oh and why not stop saying "incentive" when you just mean profit??

[Flubber]

Originally posted by Kidicious


You're contradicting yourself. How can the premium be incentive if it only equals the risk cost?

I rejected that assumption on your part several times now as I still see your term "risk cost" as a garbage term. i even presented an example with numbers where the risk premium would be insufficient to invest despite the fact that risk premium exceeded risk cost ( as you defined it).

If a project has a 10% chance of losing 500million, that would mean a risk cost of 50million. So what ? Its an irrelevant number ( doesn't even consider the capital cost)

[Flubber]

Back to kid -- what is the difference between risk premium (which I have defined a couple of times ) and incentive? . . . and why does this two part distinction matter since a risk premium by its nature is a higher expected rate of return to compensate for or incentivize a risky investment?

[Kidlicious]

Originally posted by Flubber
Free will, kid-- If you don't want to rent my tractor or apartment or whatever, then don't. Just don't be suprised that lots of others will rent stuff to their advantage ( they will make more and more money and wonder what all the "exploitation" crap is about).

You just don't understand that I have to pay 'incentive' just like everyone else. I don't want to, but I have to because I live in a capitalist system. Now why should I have to? If the majority of people no longer want to pay the incentive, then why should we have to?

My question is how do you not allow the businesses to profit. You need food and almost all that is available to a city dweller comes from businesses. I expect most of the agribusinesses and food conglomerates could outwait your decision not to purchase and when you do purchase, they will earn a profit.

There you go. I couldn't have said it better. We don't have a choice, except if we don't want to pay we can change the system.

Oh and why not stop saying "incentive" when you just mean profit??

Because I don't just mean profit. I mean profit - risk cost.

[Kontiki]

Originally posted by Kidicious

Because you did more work than them.

Let's back up for a second. How does time off for doctors and teachers work, exactly? Do people stop getting sick or going to school?

But to more directly deal with this question, it's OK for someone to get more paid time off for working harder, but not more money. What's the difference, exactly?

I'm not sure what different answer you want. You have to live in public housing (well free housing) and eat food provided for society's less fortunate. What do you want me to say?

Isn't all housing state owned? Are there different levels of state housing? Why is the food for the poor worse than for everyone else?

[Kidlicious]

Originally posted by Flubber
Back to kid -- what is the difference between risk premium (which I have defined a couple of times ) and incentive? . . . and why does this two part distinction matter since a risk premium by its nature is a higher expected rate of return to compensate for or incentivize a risky investment?

I'm about done with you Flubber. I don't like the way you are going about the discussion. It's very annoying to me.

[Kidlicious]

You're losing my interest Kontiki.

[Kidlicious]

Just too many details that I haven't even though about, because they don't seem important.

[Flubber]

Originally posted by Kidicious

You just don't understand that I have to pay 'incentive' just like everyone else. I don't want to, but I have to because I live in a capitalist system. Now why should I have to? If the majority of people no longer want to pay the incentive, then why should we have to?

. How does this work in practice when you buy your milk in January. Should you pay them more until they are in a profit position equal to your termed risk cost??

If the grocery chain lost money can they come back to you and demand more money sicne they didn't earn ANY profit

Originally posted by Kidicious

There you go. I couldn't have said it better. We don't have a choice, except if we don't want to pay we can change the system.

Technically you do have a choice in that you could just go to a food bank -- Food is just about the only area where I can agree with the idea you have no choice and even there, I'm betting you could get some arable land and grow your own .

Originally posted by Kidicious

Because I don't just mean profit. I mean profit - risk cost.

So am I understanding correctly that you are willing to give capitalists something you call their risk cost ?? hmm if that were more properly defined as a expected rate of return for risk ( risk premium) that would work fine. Just to be fair, you don't get to complain or claw back if the capitalis earns a bit more than expected and you are not expected to pay more if the capitalist takes a loss. Deal??

[Kontiki]

Originally posted by Kidicious
You're losing my interest Kontiki.

Why? You think communism is better than capitalism. Surely you can explain what makes it better. In order to do that, I'd think you'd have to know how it works.

Seriously, do you really want to have an honest discussion? I fail to see how you can do that without defending your ideas.

[Velociryx]

Well good! Now you have someone else to be annoyed at!

Just back for a moment to catch up on the latest gems from Kamp Kidicious!

And what can I say...the more things change, the more they stay the same.

Yes, Capital does, in fact, create value simply by its presence in an equation.

You can either dig that ditch with your hands (slow, labor intensive process)

OR you can take out a loan from someone who scrimped and saved his money, and DO something with it.

The ACT of gaining this capital (money, in this case) ALLOWS you options you did not have before.

That is, in and of itself, valuable.

So you take the money and go buy yourself a tractor.

But hey....before you go getting too carried away, that was MY money used to buy the tractor.

Money I can't use right now, cos you spent it to buy something for yourself.

I want my money back, paid in full, plus a premium.

Why? Because money received tomorrow is generally worth LESS than money received today. That's one. Two, because you are using MY money. Risking MY money (store of value for my accumulated labor) on something you bought for yourself. There's a risk involved to me. A risk that I might not get the money back. That tacks a little more onto the premium I'll be expecting. We call this premium "interest." You're renting my money. I want it back and then some.

You can either choose to accept my loan and vastly simplify your life, or you can continue digging the ditch with your hands. Your call. Your choice. Those are my terms, and I get to set the terms, since it is, after all, my money up for grabs.

Of course, if I WANT to loan the money out, then my terms can't be too harsh, especially since I'm not unique in my scrimping and saving. Thus, there is an incentive built in for me not to charge too much. If I try, you'll borrow elsewhere, and I lose an opportunity.

Balance.

Kid says, "no...you should just buy the tractor for me. Or let me borrow your money, keep it indefinitely, and pay you back exactly what I borrowed, because that way, you're not getting compensated for anything but your labor (or in this case, my accumulated labor). Which is utter tripe, because there are more factors than that.

What if you never pay me back at all (a default)? What if you squander the money, or simply run off with it? These are risks I face when offering my capital out. Risks that you MUST compensate for if you want the money.

You have freedom of choice here. You don't have to take the money.

What you choose is entirely up to you.

-=Vel=-

[Flubber]

Originally posted by Kidicious


I'm about done with you Flubber. I don't like the way you are going about the discussion. It's very annoying to me.

Too bad. If you cannot handle logical questions, posed politely, it says more about you than me.

I am really not suprised. This follows the patterns of our previous discussions where long responses with detailed examples from the real world get met with one flip responses or insults from you .

The bottom line is you only seem willing to debate if someone accepts your definitions and premises as they sit. Thats not possible when they do not make sense

[Kidlicious]

Originally posted by Flubber
So am I understanding correctly that you are willing to give capitalists something you call their risk cost ?? hmm if that were more properly defined as a expected rate of return for risk ( risk premium) that would work fine. Just to be fair, you don't get to complain or claw back if the capitalis earns a bit more than expected and you are not expected to pay more if the capitalist takes a loss. Deal??

Do you think the capitalists as a group take a lose? Why would I be opposed to paying the lose if I get a net return from their gain?