I agreed with Oren that our system of "keeping score" fails to recognize full and true value. It measures profits and is now skewed towards recognizing "financial" wealth which in my view is akin to ponzi schemes. If the firm closes the plant and shareholders speculate they will do something even better with the saved funds they reward t…
I agreed with Oren that our system of "keeping score" fails to recognize full and true value. It measures profits and is now skewed towards recognizing "financial" wealth which in my view is akin to ponzi schemes. If the firm closes the plant and shareholders speculate they will do something even better with the saved funds they reward the equity holders with greater demand for the financial instruments and the value miraculously goes up in value and the score says "new wealth created" hooray. In fact decades of data show that such actions generate these short term fervor based up ticks and in the long run new real value is not created as those charged with doing something better with the funds simply do more of the same and bump, bump, bump the financial instruments may grow in perceived value but not real value and at some point a reckoning takes place. We need to recognize that we are a society and work must be properly valued / put into the scoring system. I applaud Oren's recognition of what Adam Smith explained over the perverse simplicity of Milton Friedman. Societies exist and give permission to its members to conduct business. As such business should not destroy society and create casino like schemes to massively redistribute wealth but to serve the society that enables it.
I agreed with Oren that our system of "keeping score" fails to recognize full and true value. It measures profits and is now skewed towards recognizing "financial" wealth which in my view is akin to ponzi schemes. If the firm closes the plant and shareholders speculate they will do something even better with the saved funds they reward the equity holders with greater demand for the financial instruments and the value miraculously goes up in value and the score says "new wealth created" hooray. In fact decades of data show that such actions generate these short term fervor based up ticks and in the long run new real value is not created as those charged with doing something better with the funds simply do more of the same and bump, bump, bump the financial instruments may grow in perceived value but not real value and at some point a reckoning takes place. We need to recognize that we are a society and work must be properly valued / put into the scoring system. I applaud Oren's recognition of what Adam Smith explained over the perverse simplicity of Milton Friedman. Societies exist and give permission to its members to conduct business. As such business should not destroy society and create casino like schemes to massively redistribute wealth but to serve the society that enables it.