tag:blogger.com,1999:blog-6098931612872002071.post6060094259166596294..comments2023-07-30T03:50:53.310-04:00Comments on Words Seeking Justus: Regulation, Listening to AristotleJustus Hommeshttp://www.blogger.com/profile/02660099253980153951noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-6098931612872002071.post-2952555699661134302010-04-22T09:44:25.950-04:002010-04-22T09:44:25.950-04:00Understood, and I think we agree.
I do have a b...Understood, and I think we agree. <br /><br />I do have a bit of a concern that many companies primary source of revenue is debt and not the products they sell (see Sears), but I don't think that is what you were arguing.Anonymous?https://www.blogger.com/profile/15870726303392618216noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-56081939335869625372010-04-22T09:34:51.737-04:002010-04-22T09:34:51.737-04:00Not to put words in our host's mouth, but I un...Not to put words in our host's mouth, but I understood us to be referencing service sectors, particularly the financial sector, in the context of "debt/financial services/outsourcing," and then juxtaposing that against more traditional industrial/agricultural industry. So, yes, I did not intend a contrary interpretation. <br /><br />As a practical matter, I think we'd all agree that living beyond our means is bad. Still, I believe that debt for a limited duration is a useful tool, such as in buying a house, taking out student loans, or expanding a business, provided that the borrower can reasonably expect to pay back the debt.Unknownhttps://www.blogger.com/profile/15456103457970829517noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-21638584283812015392010-04-22T09:07:18.102-04:002010-04-22T09:07:18.102-04:00John, maybe you didn't intend to make a point ...John, maybe you didn't intend to make a point of this, but I would say that debt is a very bad thing to be the foundation of the economy. Debt is a poor choice to be the foundation of anything. It will eventually lead to problems because if we have learned anything from ourselves it is that we use debt to trick us into thinking we can afford things we can't. Profits based on that create a false market that will fall.Anonymous?https://www.blogger.com/profile/15870726303392618216noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-61645816706214195092010-04-21T19:34:39.933-04:002010-04-21T19:34:39.933-04:00I am not necessarily advocating for for a more agr...I am not necessarily advocating for for a more agrarian or industrial economy. I rather like being part of a diverse and advanced economy. I am only saying that they are distinctly different types of economies with their own advantages/disadvantages. Obvious, I know, but it is frustrating that so many approach their views with respect to "the economy" as something that should operate as a whole under a universal and constant set of principles and laws.Justus Hommeshttps://www.blogger.com/profile/02660099253980153951noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-16406833720669111902010-04-21T18:03:29.654-04:002010-04-21T18:03:29.654-04:00Glad you could read it because I just now discover...Glad you could read it because I just now discovered that it's in the password-only part of the site. Oops. <br /><br />As long as you're not accusing Goldman of crookedly introducing unnatural things into the economy, I'm OK with your position regarding Aristotle, though I don't presonally internalize that lens. <br /><br />I disagree with your suggestion that an economy should be founded on production/farming/manufacturing and not debt/financial services/outsourcing. In essence, your example pits manufacturered products against offered services and suggests that only the former offers value. We heard similar arguments in the early 1900s with populist leaders who harangued on the gold standard and the implicit argument that only certain types of labor contributed to the economy. An economy can be founded on anything; the sole question is what it can provide in return for compensation. A national economy based solely on its citizens' making widgets will survive if it can sell those widgets in a manner that allows its people to live at a desirable level; similarly, an economy founded on enabling the owners of that factory to obtain the financial resources to start and operate that factory can also flourish. Quite simply, there is nothing unnatural in offering your services for compensation.Unknownhttps://www.blogger.com/profile/15456103457970829517noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-66390247651225581112010-04-21T16:51:19.439-04:002010-04-21T16:51:19.439-04:00I've read your link, and still prefer mine. H...I've read your link, and still prefer mine. However, I am SHOCKED that the Wall Street Journal would defend Wall Street. Who would have thought? ;-)<br /><br />Look, I don't really care about the Goldman Sachs case. It really is a water pistol instead of a smoking gun, BUT, I agree with Aristotle's distinction between natural and unnatural exchange, and with Medaille's assertion that the latter deserves more regulatory scrutiny.<br /><br />Refusing to see the differences, and failing to handle accordingly would be very dangerous, much like failing to see the difference between an economy built on production/farming/manufacturing and an economy built on debt/financial services/outsourcing.Justus Hommeshttps://www.blogger.com/profile/02660099253980153951noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-53107161614380883392010-04-21T14:30:38.798-04:002010-04-21T14:30:38.798-04:00I fail to see what was unethical in the conduct of...I fail to see what was unethical in the conduct of Goldman Sachs. These are sophisticated buyers knew what they were getting into and the risks; they simply discounted them. My link is shorter. :)<br /><br />http://online.wsj.com/article/SB10001424052702303491304575188352960427106.htmlUnknownhttps://www.blogger.com/profile/15456103457970829517noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-12535327655230262162010-04-21T10:46:04.211-04:002010-04-21T10:46:04.211-04:00I don't see conspiracy at work as much as huma...I don't see conspiracy at work as much as human nature. Those with the power to influence regulation would be almost foolish not to ensure they benefited in some way, but that doesn't make it right.<br /><br />I have read in detail about the case against Goldman as well, and would encourage you to read the two most recent posts at interfluidity.com (<a href="http://www.interfluidity.com/v2/784.html" rel="nofollow">this</a><br />and <a href="http://www.interfluidity.com/v2/788.html" rel="nofollow">this</a>). Even if the action by Goldman was not illegal, it was certainly unethical.<br /><br />I don't see this as an attempt to use the judicial system as insurance against loss. After all, this case deals with an almost insignificant financial amount as far as Goldman is concerned. I see it as an attempt to use the judicial system to deter and reform behavior.Justus Hommeshttps://www.blogger.com/profile/02660099253980153951noreply@blogger.comtag:blogger.com,1999:blog-6098931612872002071.post-41432711378763779872010-04-21T09:36:54.170-04:002010-04-21T09:36:54.170-04:00The excerpts quoted from John Medaille offer nothi...The excerpts quoted from John Medaille offer nothing new to the discussion of regulation. He forces an inapt juxtaposition and somehow ends up with a conclusion that, although I agree is a concern, is a little too conspiratorial in its underpinnings. <br /><br />I have long supported regulation to bring information to the market, provided that the regulations did not impose excessive costs. Some here, including our host, seem to disfavor corporations a bit more and desire more stringent regulations of them. But, is additional regulation really necessary to regulate Goldman Sachs? The government apparently believes that it can use the existing laws to pursue Goldman's activities. <br /><br />By the way, I've reviewed the case against Goldman Sachs, and as a personal matter, I question whether Goldman did anything wrong. Just as I object to the "too big to fail" policy, I oppose attempts to use the judicial system as insurance against loss.Unknownhttps://www.blogger.com/profile/15456103457970829517noreply@blogger.com