The New Yorker has new article called “Is Selling Yourself The Wave of the Future?”, purportedly on entrepreneurs Daniil and David Liberman efforts to finance their careers via equity (i.e., shares of future income) instead of debt or self-funding, and to
I think there might be more acceptance if the equity was capped in time, say 10-15 years max. There is natural retiscense to allowing a young person to sell a proportion of their entire life income when they are young and under pressure and might not have good tools for valuing their lifetime expected income.
It's like selling an arm or a leg. Though really it's just slavery. With debt you can work your way out. With equity part of you, your future, belongs to someone else. I think it would just.. feel bad to people, even if it makes sense financially.
My attempt: an analogy: it's like determining the value/status of a dogbreed based on its upkeep costs (ie, how much the dog's owner is willing to 'loan' to the dog) where more upkeep cost = more status. There's a relationship there, sure, but it misses a lot.
A share is fundamentally different from a bond. A share's value is the present value of earnings over infinite time. A bond's value is the present value of earnings over finite time. Bond prices don't reveal as much information (about the issuer) as share prices do. Bonds makes up that gap by revealing a bit more about macroeconomic stuff than shares do.
Bonds are like interviews, while equity is like gossip. Humans love gossip and hate interviews.
The egalitarian criticism invokes the moral value we instinctively attribute to high-price-equity. As in, we can still play egalitarianism even if certain people get access to more loans/scholarships/etc. But the egalitarian illusion will disappear if there's a stock price assigned to each person.
If two people are walking towards each other on the sidewalk and one them has a share price of 1000, and the other 100, should the later move out of the way in deference to the former? (the answer is yes is btw)
If a policeman is taking testimony from them later on (assuming because neither backed off) then will the policeman give more credence to the higher-valued person?
If your stock price dips below some amount, will some of your government-issued privileges (rights) be taken away? Will concerts only let people of certain stock-value attend?
This is basically an economist's version of the social scoring system; decentralized, efficient, and fun.
People can already make loans to poor folks, and choose not to. So I don't see that their also failing to buy equity would add that much to the signal/.
We'll never allow this, though other societies might. It's repugnant because for now we can write off our social inequities as outcomes of historical prejudice. But even the wokest investors will not bid up the futures prices of inner-city boys, even when such shares are very affordable compared to those of other kids. I might be wrong, but I think the woke are deep down pretty sure I'm right, and they don't want to be forced to show their cards. Their opponents will always get to say "If you claim that [group X] is so undervalued, why aren't you buying shares, mentoring them up, and beating the market?"
Why doesn't a similar argument apply to debt?
I think there might be more acceptance if the equity was capped in time, say 10-15 years max. There is natural retiscense to allowing a young person to sell a proportion of their entire life income when they are young and under pressure and might not have good tools for valuing their lifetime expected income.
It's like selling an arm or a leg. Though really it's just slavery. With debt you can work your way out. With equity part of you, your future, belongs to someone else. I think it would just.. feel bad to people, even if it makes sense financially.
That's a question for someone like Tyler Cowen.
My attempt: an analogy: it's like determining the value/status of a dogbreed based on its upkeep costs (ie, how much the dog's owner is willing to 'loan' to the dog) where more upkeep cost = more status. There's a relationship there, sure, but it misses a lot.
A share is fundamentally different from a bond. A share's value is the present value of earnings over infinite time. A bond's value is the present value of earnings over finite time. Bond prices don't reveal as much information (about the issuer) as share prices do. Bonds makes up that gap by revealing a bit more about macroeconomic stuff than shares do.
Bonds are like interviews, while equity is like gossip. Humans love gossip and hate interviews.
Why isn't the total amount of loans made to them a similarly strong signal as their share price?
The egalitarian criticism invokes the moral value we instinctively attribute to high-price-equity. As in, we can still play egalitarianism even if certain people get access to more loans/scholarships/etc. But the egalitarian illusion will disappear if there's a stock price assigned to each person.
If two people are walking towards each other on the sidewalk and one them has a share price of 1000, and the other 100, should the later move out of the way in deference to the former? (the answer is yes is btw)
If a policeman is taking testimony from them later on (assuming because neither backed off) then will the policeman give more credence to the higher-valued person?
If your stock price dips below some amount, will some of your government-issued privileges (rights) be taken away? Will concerts only let people of certain stock-value attend?
This is basically an economist's version of the social scoring system; decentralized, efficient, and fun.
People can already make loans to poor folks, and choose not to. So I don't see that their also failing to buy equity would add that much to the signal/.
Fixed; thanks.
Also: imagine dating profiles that show the market value of your futures. Not an irrelevant stat for people looking for partners with potential!
We'll never allow this, though other societies might. It's repugnant because for now we can write off our social inequities as outcomes of historical prejudice. But even the wokest investors will not bid up the futures prices of inner-city boys, even when such shares are very affordable compared to those of other kids. I might be wrong, but I think the woke are deep down pretty sure I'm right, and they don't want to be forced to show their cards. Their opponents will always get to say "If you claim that [group X] is so undervalued, why aren't you buying shares, mentoring them up, and beating the market?"
The link to the article you discuss is broken (missing the last e).
https://www.newyorker.com/m...
Reminds me of Publicly Traded Person, 5 bucks a share in him. He started over a decade ago.
https://www.marketplace.org...