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Thread: When will WallStreetBets end up getting people indicted or broke?

  1. #61
    On A lighter note
    "In a field where an overlooked bug could cost millions, you want people who will speak their minds, even if they’re sometimes obnoxious about it."

  2. #62
    Quote Originally Posted by Steely Glint View Post
    That based on data, or just your circle of acquaintances?
    Data. My circle of acquaintances in my age bracket isn't that wealthy yet, I'm only mid-30s.

    Let's look at the Fed's data. Median net worth for the 35-44 demographic by household is only $91k (see here). But if you stratify it by college educated and the 75th percentile (I think it's reasonable to expect that your typical Congressman will be in the top 25 percent of college graduates in terms of capability and earning power, especially since 2/3 of them are lawyers), a 35-44 age bracket has a net worth of $600k. If you go out to typical Congressman ages, the 55-65 bracket, you're looking at $1.9 million net worth. If you don't like my use of the 75th percentile for the college educated, go with the median value of ~$700k. But remember that even those politicians who are technically 'of the people' went to pretty fancy schools like BU (AOC, cum laude) and U of C (Bernie), elite institutions that have much higher lifetime earning expectations than a low end 4 year college.

    This Fed data also has useful other information, including stuff like how most households with higher than median net worths own equities of one sort or another, suggesting that stock ownership is quite broad among the middle classes.

    It seems like including 'house equity' i.e. owning a house and paying off your mortgage in the same category as shorting gamestop is a little disingenuous there.
    Sorry, my language was imprecise, I meant to distinguish between 'equities' as in tradable securities like stocks and bonds and 'house equity' as in how much of your house you own vs. the bank. Middle class households have most of their net worth tied up in their house (or, if they're very luck, their pension); higher income households have a much bigger percentage tied up in other securities.

    Nevertheless, if the only way to reasonable prepare for your future in the US even for the well trained middle class is to make bets on abstract mathematical models about fictitious capital/what drunk idiots think abstract mathematical models will say about fictitious capital, then that seems like it might be bad. We should probably do something about that, like make wages go up or something.
    The US has moved away from DB pension schemes for 40 years, and Social Security benefits aren't enough to cover expenses for people who make much above median income. It's pretty standard for any salaried position (and some hourly ones) to have tax advantaged retirement accounts that are invested in a mix of stock and bond mutual funds/ETFs and directed by the individual who owns them. I agree that there are downsides to shifting market and other risks onto the individual but that's the reality we live in, so it's only prudent for most middle class to upper class workers to start investing in equities or funds thereof early on in their careers. And if one is to buy relatively boring assets like index funds or target date funds, the risk is relatively manageable. I wouldn't recommend that people, say, invest large proportions of their assets into funding a short squeeze that will leave them holding worthless stock they overpaid for, but most retail investors are smarter than that.

    To be clear, problem I have with letting them to continue to trade but have someone else actually make the decision is it's honestly too easy to pass information back and forth in ways that are completely deniable. "Thinking about making it so all new cars have to be EVs by 2030" "Say no more", etc

    These guys can put their money in an ISA or something.
    Uh... I'm no expert on UK rules, but isn't an ISA just like a 401(k) or an IRA? You still generally invest inside an ISA in tradable securities like stocks and bonds, and you can still direct the investments. So I don't understand how that helps...?

    Please see my comments above to LF about the parallel to insider trading. I think you can make it a crime to tell your buddies about the new policy/law/circumstance that is coming down the line, and illegal for your buddies to act on that information. You can still let them have beneficial ownership (though not direct control) over stocks and bonds.

    Ineligible for public office. Why do you think I was so down on Bloomberg as the Democratic nominee all those years ago? Other than him being terrible, obviously.
    Well, you and I disagree. I do not think that there should be tests for office other than the basics of citizenship and age as described in the constitution.

    For spouses: yes to assets, no to jobs. Not sure about kids, that is genuinely a good point; I would probably lean towards drawing the line at restrictions on adult children. Spouses tend to share assets, but once kids grow up they're ostensibly independent individuals.
    Not really sure how this solves your problem? Parents often bequeath substantial assets to their kids in their lifetimes, and it wouldn't be very hard for them to give a nudge and a wink in the right direction for trading.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  3. #63
    Quote Originally Posted by wiggin View Post
    Uh... I'm no expert on UK rules, but isn't an ISA just like a 401(k) or an IRA? You still generally invest inside an ISA in tradable securities like stocks and bonds, and you can still direct the investments. So I don't understand how that helps...?
    Yes it is. Its just an investment mechanism that exempts certain taxes on the investment in order to encourage more investment to occur, but within only a certain tax-free allowance per annum.

    I don't know how it works in the USA but in the UK Parliament there is a "register of interests" that politicians have to declare their interests on - so if they own significant stock in a company, or are paid as an advisor to that company etc then it has to be publicly declared.

    I think that transparency mechanism is good. Let people do what they want, but hold them to account for what they do. Failure to declare an interest then is an offence, but if its declared then let the public decide. People will generally avoid dodgy behaviour if they know it will come out.
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  4. #64
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  5. #65
    That is one reason why I suspect people are gonna be indicted—on several sides.
    “Humanity's greatest advances are not in its discoveries, but in how those discoveries are applied to reduce inequity.”
    — Bill Gates

  6. #66
    Quote Originally Posted by RandBlade View Post
    Isn't this more or less exactly what I said?
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  7. #67
    Yes. Pretty much.
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  8. #68
    Quote Originally Posted by RandBlade View Post
    Yes it is. Its just an investment mechanism that exempts certain taxes on the investment in order to encourage more investment to occur, but within only a certain tax-free allowance per annum.

    I don't know how it works in the USA but in the UK Parliament there is a "register of interests" that politicians have to declare their interests on - so if they own significant stock in a company, or are paid as an advisor to that company etc then it has to be publicly declared.

    I think that transparency mechanism is good. Let people do what they want, but hold them to account for what they do. Failure to declare an interest then is an offence, but if its declared then let the public decide. People will generally avoid dodgy behaviour if they know it will come out.
    The US has a set of financial disclosure rules for elected officials (mostly at the federal level); that's how we know things about e.g. financial moves before the pandemic lockdowns and Nancy Pelosi's position in Tesla. Clearly transparency alone (even with a robust press) is not going to do the trick. I think there's no reason why we shouldn't have a law requiring people to relinquish trading control of their tradable securities when they reach certain offices, and a similar law forbidding people to communicate non-public information such that it causes a beneficial trade.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  9. #69
    Given we're talking about it, maybe transparency is doing the trick?
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  10. #70
    Didn't stop them from doing it. AFAIK there haven't been any real consequences. There was a DOJ investigation of the post-Covid briefing trades but they investigations were closed after two months. Honestly I don't think they were doing anything illegal under current law. Certainly it doesn't look like there were any e.g. ethics investigations or changes to behavior.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  11. #71
    The difference for me with the Covid briefing issue was that it bore a remarkable similarity to insider trading. Pelosi trading does not since there are no inside secrets.

    But also quite frankly the transparency did its job for Senators doing dodgy post COVID briefing trades. Without that news story and the ample publicity it gave to John Ossoff might Senator Purdue not have found the few extra votes he needed to win in the first round? Indeed weren't both Georgia Senate nominees roundly attacked for this?

    Certainly Ossoff crucified Purdue over the trades, narrowly scraped getting a run off, then won election. Transparency working in action, let the voters decide.

    Without that scandal might we not now have a GOP controlled Senate?
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  12. #72
    I'd prefer that people be expelled from Congress and jailed, but that's just me.

    Transparency might work for the like of the Pelosi trades - trades that are themselves only problematic in potential. But even better would be to eliminate the potential conflict of interest by stripping these officials of trading power over their assets.

    Disclosure of conflicts is a pretty standard practice in business, academics, etc. But it only works when you can reasonably circumscribe your activities to limit your decision making capabilities that might affect your conflict. In the case of a lawmaker, they can't recuse themselves from voting. They are GOING to have a conflict, and just knowing about it isn't as good as eliminating it as much as possible.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  13. #73
    I prefer transparency as it hands the power to the voters and if you refuse a transparent way for people to act then they just find a way around the rules and act covertly, which is worse.
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  14. #74
    Oh, I don't think we should get RID of transparency, just supplement with laws and actual consequences.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  15. #75
    Transparency only works if the activity is legal and has no actual consequences.

    But if you have laws and actual consequences that mean its illegal to trade or own stocks for instance, as opposed to legal but transparent to do so, then my contention is that instead of doing legal and transparent activities people will do covert and more dodgy activities instead.
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  16. #76
    Quote Originally Posted by wiggin View Post
    The US has moved away from DB pension schemes for 40 years, and Social Security benefits aren't enough to cover expenses for people who make much above median income. It's pretty standard for any salaried position (and some hourly ones) to have tax advantaged retirement accounts that are invested in a mix of stock and bond mutual funds/ETFs and directed by the individual who owns them. I agree that there are downsides to shifting market and other risks onto the individual but that's the reality we live in, so it's only prudent for most middle class to upper class workers to start investing in equities or funds thereof early on in their careers. And if one is to buy relatively boring assets like index funds or target date funds, the risk is relatively manageable. I wouldn't recommend that people, say, invest large proportions of their assets into funding a short squeeze that will leave them holding worthless stock they overpaid for, but most retail investors are smarter than that.
    Maybe if we take legislators stocks away, they'll be motivated to do something about that.

    To be honest, this doesn't seem like an unsolvable problem but rather an ad hoc justification for keeping things exactly as they are.

    Uh... I'm no expert on UK rules, but isn't an ISA just like a 401(k) or an IRA? You still generally invest inside an ISA in tradable securities like stocks and bonds, and you can still direct the investments. So I don't understand how that helps...?
    Oh yeah, that's right. Well, they can just use one of those basic saver accounts you get when you open a bank account. Mine has an 0.01% interest rate.

    Sorry, man, I don't see why we should be bending over backwards to make sure congress people's financial interests are secure in exactly the way they'd like while attempting to solve this problem. It's not as though they're ever going to return the favour

    Please see my comments above to LF about the parallel to insider trading. I think you can make it a crime to tell your buddies about the new policy/law/circumstance that is coming down the line, and illegal for your buddies to act on that information. You can still let them have beneficial ownership (though not direct control) over stocks and bonds.
    Yeah, but... we have to know what policies are coming down the line so we know who to vote for and weather or not we should be protesting etc. Can't really keep that information private.

    Well, you and I disagree. I do not think that there should be tests for office other than the basics of citizenship and age as described in the constitution.
    If they're serious about running for office, they can untangle their affairs from their former company before they make their run, perhaps allowing a grace period for freshman legislators to get their affairs in order since when they're running for office for the first time they can't really know if they're going to actually win a seat. We can be flexible, but in general we don't want people with massive financial interests helping to make laws.

    Not really sure how this solves your problem? Parents often bequeath substantial assets to their kids in their lifetimes, and it wouldn't be very hard for them to give a nudge and a wink in the right direction for trading.
    Guess what I've suddenly decided congress people can't pass on to their kids?

    Anyway. The wider point is that just because the problem cannot be fully and completely solved, doesn't mean we shouldn't grab some of the low hanging fruit. I honestly find it breath taking that politicians are allowed to own investments and take donations from large companies, this level of conflict of interest would never be allowed to exist anywhere else
    So may your dreams be monumental when your spirit guides the way
    Within in the flicker of a candle, I will heal your soul's decay
    We share a fate, trapped on a page, by the author of our world's demise

  17. #77
    "We have to be able to invest in and trade securities because we made it impossible for anyone to have a comfortable retirement any other way by indulging in unconstrained capitalist avarice for 40 years!"

    sounds like a 'you' problem, guys.
    So may your dreams be monumental when your spirit guides the way
    Within in the flicker of a candle, I will heal your soul's decay
    We share a fate, trapped on a page, by the author of our world's demise

  18. #78
    Quote Originally Posted by Steely Glint View Post
    Maybe if we take legislators stocks away, they'll be motivated to do something about that.

    To be honest, this doesn't seem like an unsolvable problem but rather an ad hoc justification for keeping things exactly as they are.
    Quote Originally Posted by Steely Glint View Post
    "We have to be able to invest in and trade securities because we made it impossible for anyone to have a comfortable retirement any other way by indulging in unconstrained capitalist avarice for 40 years!"

    sounds like a 'you' problem, guys.
    Okay, but this is obviously a much bigger policy issue than the much more narrow question of addressing the potential for Congressional corruption. I should note that lifers in Congress actually have pretty decent DB pensions through FERS, but it really is only a good deal for people who have been there for a long time... so your non-professional politicians still need assets outside of FERS or Social Security.

    There are a lot of reasons for shifting to a personally managed DC system, and while it's far from perfect I don't view it as uniformly evil as you seem to.

    Oh yeah, that's right. Well, they can just use one of those basic saver accounts you get when you open a bank account. Mine has an 0.01% interest rate.

    Sorry, man, I don't see why we should be bending over backwards to make sure congress people's financial interests are secure in exactly the way they'd like while attempting to solve this problem. It's not as though they're ever going to return the favour
    Look, doing this kind of thing punishes those Congressmen who don't have lots of assets. I'm sure that those who do have lots of assets can live off their near-cash assets if they sold their tradable securities, or maybe they can just squirrel the money away with relatives and the like who can let it continue to grow. But your typical junior member of the House isn't particularly wealthy and will see no pathway to save for retirement if it's completely forbidden. I am also troubled by the conclusion that it's okay not just to ban this activity for the politician but also their spouse. I am very happy that so many political spouses these days have impressive careers of their own, and some of those are going to involve substantial investment positions that are difficult or impossible to unwind for their jobs. Why should the spouse be forced to sacrifice their career (let alone financial security) just because they are married to a politician or senior official?

    On a more philosophical note, I prefer the policy that is least intrusive and coercive. It seems like the same goals can be achieved without outright bans, and possibly also reducing a lot of the unintended consequences.


    Yeah, but... we have to know what policies are coming down the line so we know who to vote for and weather or not we should be protesting etc. Can't really keep that information private.
    Once the information is public, our hired money managers can act on it like anyone else. The issue arises when the money managers get information that is not YET public, such as, for example, the government's projections as to the severity of a looming pandemic.

    If they're serious about running for office, they can untangle their affairs from their former company before they make their run, perhaps allowing a grace period for freshman legislators to get their affairs in order since when they're running for office for the first time they can't really know if they're going to actually win a seat. We can be flexible, but in general we don't want people with massive financial interests helping to make laws.
    So you'd like someone to tear apart a company they built over their entire life on a small chance that they'll win a series of primaries and a general election? Or force them to make a hurried disposition in the ~2 months between the general and the start of their term? That seems both unfair and, frankly, destructive. I do not think that doing nothing is a good solution either - certainly the conflicts of interest are substantial for something like this - but it's not clear to me that I've heard a good solution.

    I'd also like to raise the point that this needn't be the province of the mega-rich. I currently own stock and stock options in a privately held, venture backed company. It's not worth much now, but if I do my job and get very lucky, it could conceivably be worth as much as a couple million dollars in the future, easily increasing my net worth by several times. But I can't sell it now - there's no market for the securities, and actually there are rules as to how I can dispose of the stock and/or options. If I were elected a member of Congress (heh, unlikely), I would have no easy way to dispose of these. I'd be taking a massive potential loss on something that was part of my compensation for a lengthy and difficult education and years of working long hours with extremely uncertain job security; how is that equitable?

    You can only imagine how much harder it would be to dismantle various large positions in larger enterprises. I am not comfortable just saying that 'you must have less than X amount of assets to work in government'. I'd prefer to think through the issues and try to come up with a workable plan.

    [...]
    Anyway. The wider point is that just because the problem cannot be fully and completely solved, doesn't mean we shouldn't grab some of the low hanging fruit. I honestly find it breath taking that politicians are allowed to own investments and take donations from large companies, this level of conflict of interest would never be allowed to exist anywhere else
    I am not a huge fan of allowing corporations, large or small, to make political donations. I do not fully understand the constitutional arguments in Citizens United, but it seems wrong to me and corrosive to democratic institutions. It seems like the main way to fix this would be through constitutional amendment, though, which hardly seems like 'low hanging fruit'.

    I do not have a problem with politicians owning investments per se, especially given that large swathes of the US population do the same and it's an integral part of most household's financial security. I do think that steps should be taken to minimize the temptation and ability of politicians or other senior officials from profiting from their positions or knowledge; a blanket ban might work but seems unfair and unnecessary to me.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  19. #79
    The idea is that you shouldn't have less speech just because you pool your resources. People never look at the other side of the coin on this issue, if companies can't contribute what stops them from just running the ads themselves? Or do you then somehow pretzel logic justify the idea of a sitting government stopping private citizens from passing along their political messages in a way that reaches a lot of people? Opposing Citizens United is pretty much saying you don't like freedom of speech. Which is a pretty progressive thing to do nowadays as most progressives are firmly against freedom of speech (waaah hate speech should be illegal).

  20. #80
    Quote Originally Posted by Lewkowski View Post
    The idea is that you shouldn't have less speech just because you pool your resources. People never look at the other side of the coin on this issue, if companies can't contribute what stops them from just running the ads themselves? Or do you then somehow pretzel logic justify the idea of a sitting government stopping private citizens from passing along their political messages in a way that reaches a lot of people? Opposing Citizens United is pretty much saying you don't like freedom of speech. Which is a pretty progressive thing to do nowadays as most progressives are firmly against freedom of speech (waaah hate speech should be illegal).
    If they run the ads themselves it might fall into the category of in-kind contributions and be regulated by statutes that cover that instead.
    “Humanity's greatest advances are not in its discoveries, but in how those discoveries are applied to reduce inequity.”
    — Bill Gates

  21. #81
    Quote Originally Posted by Ominous Gamer View Post
    ℬeing upset is understandable, but be upset at yourself for poor planning, not at the world by acting like a spoiled bitch during an interview.

  22. #82
    Quote Originally Posted by Aimless View Post
    If they run the ads themselves it might fall into the category of in-kind contributions and be regulated by statutes that cover that instead.
    And we are back to "Sitting government does not allow speech that would cost them elections." Though the "in-kind" contribution seems an interesting knot to work out given that many newspapers openly endorse candidates. Given sufficient readership would you consider that an "in-kind contribution"? It isn't currently.

  23. #83
    Quote Originally Posted by wiggin View Post
    Okay, but this is obviously a much bigger policy issue than the much more narrow question of addressing the potential for Congressional corruption. I should note that lifers in Congress actually have pretty decent DB pensions through FERS, but it really is only a good deal for people who have been there for a long time... so your non-professional politicians still need assets outside of FERS or Social Security.
    Addressing congressional corruption is a policy issue, though.

    You seem to be under the slightly mistaken impression that I'm wanting to do this because I find it repulsive when congress people use their position to get rich and I think, yes, we can all agree that is repulsive and should be stopped, but the actual issue I'm after is the way in which congress people's vested interests affect policy, even in ways that don't stretch to anything you could call corruption.

    For example, if they're all people who's own personal future is tied up into how the Line is doing then they're going to tend towards policy that makes the Line go up even if it negatively effects the lives of people lower down the income scale. Like they do all the goddamn time.

    If we have to increase their direct compensation or improve their pension plan to do that, then we should do that. We could even link it to the median American wage or something. A long time ago, you and I had a discussion about the compensation of CEO and the necessity of incentives for them to do their jobs, why should the same logic not apply to politicians?

    Look, doing this kind of thing punishes those Congressmen who don't have lots of assets. I'm sure that those who do have lots of assets can live off their near-cash assets if they sold their tradable securities, or maybe they can just squirrel the money away with relatives and the like who can let it continue to grow. But your typical junior member of the House isn't particularly wealthy and will see no pathway to save for retirement if it's completely forbidden.
    For example, if this is truly a problem then I would simply make them a good pension scheme.

    I making this move, I am showing about 300% more interest in their well being than most of those scumbags every would in someone like me, sooo

    I am also troubled by the conclusion that it's okay not just to ban this activity for the politician but also their spouse. I am very happy that so many political spouses these days have impressive careers of their own, and some of those are going to involve substantial investment positions that are difficult or impossible to unwind for their jobs. Why should the spouse be forced to sacrifice their career (let alone financial security) just because they are married to a politician or senior official?
    Yeah.... I think you and I have very different ideas about what 'financial security' means.

    Once the information is public, our hired money managers can act on it like anyone else. The issue arises when the money managers get information that is not YET public, such as, for example, the government's projections as to the severity of a looming pandemic.
    Same as my reply above. While this is certainly a problem, it is not the problem.

    So you'd like someone to tear apart a company they built over their entire life on a small chance that they'll win a series of primaries and a general election? Or force them to make a hurried disposition in the ~2 months between the general and the start of their term? That seems both unfair and, frankly, destructive.
    Click to view the full version

    I'd also like to raise the point that this needn't be the province of the mega-rich. I currently own stock and stock options in a privately held, venture backed company. It's not worth much now, but if I do my job and get very lucky, it could conceivably be worth as much as a couple million dollars in the future, easily increasing my net worth by several times. But I can't sell it now - there's no market for the securities, and actually there are rules as to how I can dispose of the stock and/or options. If I were elected a member of Congress (heh, unlikely), I would have no easy way to dispose of these. I'd be taking a massive potential loss on something that was part of my compensation for a lengthy and difficult education and years of working long hours with extremely uncertain job security; how is that equitable?
    You would be moving to a new job which thanks to my generous and beneficent intervention now has a good enough pension scheme to leave you with a very comfortable retirement. If you still want to keep your stonks, you can always... not join congress, kinda of? It's not actually compulsory.

    You can only imagine how much harder it would be to dismantle various large positions in larger enterprises. I am not comfortable just saying that 'you must have less than X amount of assets to work in government'. I'd prefer to think through the issues and try to come up with a workable plan.
    Well, I say my plan is workable, especially when you consider not having the mega-rich in congress a feature rather than a bug
    So may your dreams be monumental when your spirit guides the way
    Within in the flicker of a candle, I will heal your soul's decay
    We share a fate, trapped on a page, by the author of our world's demise

  24. #84
    "In a field where an overlooked bug could cost millions, you want people who will speak their minds, even if they’re sometimes obnoxious about it."

  25. #85
    Quote Originally Posted by Steely Glint View Post
    Addressing congressional corruption is a policy issue, though.

    You seem to be under the slightly mistaken impression that I'm wanting to do this because I find it repulsive when congress people use their position to get rich and I think, yes, we can all agree that is repulsive and should be stopped, but the actual issue I'm after is the way in which congress people's vested interests affect policy, even in ways that don't stretch to anything you could call corruption.

    For example, if they're all people who's own personal future is tied up into how the Line is doing then they're going to tend towards policy that makes the Line go up even if it negatively effects the lives of people lower down the income scale. Like they do all the goddamn time.
    The point of a blind trust is that the beneficial owners don't know what assets they own. So while they might have an incentive to enact policies that provide long term strength for asset markets as a whole, they don't exactly have an incentive to provide benefits for specific companies or sectors. I do think that politicians and others waste too much time equating the strength of, say, the stock market with broader economic strength. But I don't have a problem with politicians having a personal incentive for strong and stable markets, no.

    If we have to increase their direct compensation or improve their pension plan to do that, then we should do that. We could even link it to the median American wage or something. A long time ago, you and I had a discussion about the compensation of CEO and the necessity of incentives for them to do their jobs, why should the same logic not apply to politicians?
    I'll address your pension idea later, but I do think this is a really interesting idea. Is there a way to tie compensation of politicians to their performance? I'm not sure it's super easy outside of the Executive Branch because the votes of one Congressman rarely affect policy substantively (pretty much all legislation is decided by a handful of Congressional leaders and perennial swing votes). So it would be hard to tell a politician that their job performance (or lack thereof) is why the economy or wages or unemployment or whatever is doing well/poorly. I certainly think that when the government is not funded then politicians should not be paid, but a more comprehensive plan seems challenging to implement.

    I do like the idea in principle, though. I'll think on it.

    For example, if this is truly a problem then I would simply make them a good pension scheme.

    I making this move, I am showing about 300% more interest in their well being than most of those scumbags every would in someone like me, sooo
    They already have a good pension scheme. For lifers, that is. If you're in the House or Senate for 30 years you won't need to have separate assets. But what if you join the House after 20 years in the private sector? And what if you get booted after 1 or 2 terms? You'll have potentially fatally damaged your financial security and you'll get a pittance in pension from Congress.

    Unless you're suggesting we should offer a lavish pension to anyone who serves in Congress (or, IMO, high ranking public servants) for any period at all.

    Yeah.... I think you and I have very different ideas about what 'financial security' means.
    Super likely scenario: you have your own career, saving up your own retirement funds in various ETF/mutual funds and/or you have a stake in your business. Your spouse runs for Congress, you have to divest yourself of all of your holdings (and end up selling at an inopportune time, also possibly jeopardizing your control of said business). Then you get divorced 5 years later; your spouse had a cushy pension and you're stuck with a much smaller nest egg than you thought you'd have. I wouldn't want to rely on alimony; would you?

    Well, I say my plan is workable, especially when you consider not having the mega-rich in congress a feature rather than a bug
    I have no issue with preferring that people who are very wealthy not gain political power; I don't like how hard it is to gain political power if you're not part of the elite, and how much money is required. But a preference is distinct from a law.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

  26. #86
    Few points of contention remain here that aren't tied to disagreements far deeper than the issues actually in discussion, but:

    Quote Originally Posted by wiggin View Post
    So while they might have an incentive to enact policies that provide long term strength for asset markets as a whole, they don't exactly have an incentive to provide benefits for specific companies or sectors.
    This is, of course, what lobbying and political donations by corps are for

    I do think that politicians and others waste too much time equating the strength of, say, the stock market with broader economic strength.
    Yeah, ok, we agree here... but what do you make of this information? You can't just be like "oh well, I guess the politicians are obsessed with The Line and read too much into it's significance, c'est la vie", there must be some reason why you think this is the case?

    I'm sure you know why I think it's the case...

    Unless you're suggesting we should offer a lavish pension to anyone who serves in Congress (or, IMO, high ranking public servants) for any period at all. everyone who needs one
    Yep

    Super likely scenario: you have your own career, saving up your own retirement funds in various ETF/mutual funds and/or you have a stake in your business. Your spouse runs for Congress, you have to divest yourself of all of your holdings (and end up selling at an inopportune time, also possibly jeopardizing your control of said business). Then you get divorced 5 years later; your spouse had a cushy pension and you're stuck with a much smaller nest egg than you thought you'd have. I wouldn't want to rely on alimony; would you?
    Should probably dip into your rainy day fund and cut down on avocado toast or something, I don't know. They really should have planned for something like this happening, and it's no good blaming the system just because they were financially irresponsible.
    So may your dreams be monumental when your spirit guides the way
    Within in the flicker of a candle, I will heal your soul's decay
    We share a fate, trapped on a page, by the author of our world's demise

  27. #87
    Quote Originally Posted by Steely Glint View Post
    Yeah, ok, we agree here... but what do you make of this information? You can't just be like "oh well, I guess the politicians are obsessed with The Line and read too much into it's significance, c'est la vie", there must be some reason why you think this is the case?

    I'm sure you know why I think it's the case...
    This is actually an interesting question. There's a lot of reason why politicians and much of the public look at markets as a measure of economic strength. First off, they're a rapid gauge of sentiment and can sometimes react very quickly and dramatically to changes in circumstances (such as political leaders, economic shocks, new policies, etc.). So people use them as a stand in for other measures of the economy that tend to be lagging indicators but are often more representative of what typical people actually experience in an economy (e.g. GDP growth, employment, wages, inflation, industrial production, consumer confidence). So if you're trying to understand how 'people' see a certain event, you might look at markets even though they might offer a very skewed result.

    Secondly, for the upper chunk (maybe 2 quintiles?) who own most of the stocks in America, markets do have an effect on perception and behavior, the so-called 'wealth effect'. I'm not sure if the effect is as big as people think in terms of actual consumption behavior, but I would definitely agree that for this portion of the electorate (who tend to be more politically engaged) they certainly feel better if their homes and retirement portfolios look flush. Politicians may have internalized this perception.

    Third, we're stuck in a 24 hour news cycle that loves the newest story about markets, which is far more exciting than dissecting the latest Beige Book in excruciating detail. Politicians pay a lot of attention to media and can easily get caught up in the hype.
    "When I meet God, I am going to ask him two questions: Why relativity? And why turbulence? I really believe he will have an answer for the first." - Werner Heisenberg (maybe)

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