Friday, February 16, 2024

Thoughts While Making Sauerkraut; Property and the Judo of Its Destruction By Erwin J. Haas MD MBA

 ..........Material wealth is also important because it allows me, the endowed, with extra time to make better decisions. Wealth then has an effect on the owner.

Yet some of this kind of wealth is alienated; it does not reflect my moral and intellectual values. This saved or unexpended labor is invested in various financial instruments “prudently” diversified following rules promulgated by academics. Most savings fund regular companies producing goods and services that are sold at a profit. But some of that money goes to companies like KKK, the mountain of money that buys up productive companies and then tears them apart and sells the profitable parts – and damn the losers.

I’d like to reflect on how some elements of this predatory turn of property differ from the property of my lived life.

I’ll stay in the area of finance. Let’s say that I buy shares of Goldman-Sachs or of some similar investment corporation. My involvement was doing some research on that stock and buying it for my online IRA account. Goldman-Sachs was started many years ago by the eponymous entrepreneurs who made it their property by intertwining their lives with the venture. They died but the business continued  and it grew larger, capitalized by strangers.The ownership was divided among an ever enlarging circle of partners and then more recently between shareholders and various lenders. The ownership interest became divided in a million ways but very few of the current owners either understand or will do the work necessary to make good banking decisions. Goldman changed; It started making serious money in manipulating large blocks of money in the bond market,  derivatives, foreign currency trading, mergers and the like. Few”owners” could endure the legal grind of mergers or handle the math on options.  Their claim to this “property” would seem to be fairly abstract.

Most owners are not critically dependent on this one stock and see it as another accounting entry in a properly diversified portfolio. They have not mixed their labor with pure potential making it the property that is part of their very being. Indeed, I would argue that the spinning of derivatives,  playing with currencies and operating at the edges of laws is not productive property at all, but rather a sort of casino in which poor people fritter away their savings.
Candidly, Goldman-Sachs causes big things to happen so that large projects get built and markets are tranquil. But It is run by an incestuous gang of managers, a  politicized Board of Directors and with the connivance of a governmental nomenklatura.  The big money is made by playing loose and fast with ethical business practices, engendering ad hoc laws to restrict competition, obfuscating losses, influencing the media to create favorable publicity, gaining obscene amounts of money with which they handsomely reward managers and directors. It buys politicians. The megacorporation makes money by offshoring manufacturing and screwing the little people who lose their livelihoods. They keep the stockholders placid, increasing their “equity” by playing the financial and unproductive games of buybacks…. The extreme financial chicanery is by Blackstone which collected a trillion in retirement savings and then bought the stock of corporations sufficient to control governance of productive companies, all in service of a political fantasy.

 I submit that the major activities of these entities is avoiding taxes, making money with money and not by making salable goods.  They prosper in courthouses and in the froth of our modern fiat currencies. They turn productive property back into worthless potential, nullifying the labor that created them, destroying property.

I can conjure up similar criticisms for the military industrial complex, for many drug companies and for governments.

Prudent investment portfolio theory, mutual funds and exchange traded funds all include these moral stinkers........

Read it all: