Economic innovation for a bright new world
Say No to Consumer Protection
Wednesday - April 25, 2012.
Yesterday Barack Obama spoke at UNC in Chapel Hill, NC where he highlighted the importance of higher education and referred to the new Consumer Financial Protection Bureau’s
(CFPB) role in protecting consumers from deceptive, abusive and predatory loan products in the financial marketplace, with budding students cheering him on.We can do better
Barack’s work in softening the blow of a $15.6 trillion in spending spree raked up by the legislation managed by previous administrations exacerbated by a spiraling down of the economy should be commended. But many of the new initiatives he signed off on and that attempt to artificially correct, optimize or prevent certain economic outcomes (we refer to as downstream optimizations) pacify the public in having them believe those measures will solve our economic malaise, have a short political shelf life and are prone to partisan repeal as quickly as a CEO changing the logo of his company shortly after taking office. If only to mark a partisan territory in history.
Separation of politics and state
But politics has no place in the development of an economic master plan, simply because the right economic master plan is designed to build and serve the dynamic meritocracy of all of our ideals and beliefs. Partisan division occurs because short of the aforementioned economic master plan everyone thinks their unique implementation and interpretation supported by quick scoring downstream corrections will magically erase years of blatant macro-economic ignorance.
Downstream economic optimizations like The American Jobs Act, Startup America, and the Consumer Financial Protection Bureau’s initiatives are comfortably floating in midair of public (open microphone: election) karma, blissfully ignoring that detached from a viable economic master plan those corrections will simply spawn a more fragmented and more opaque composition of new economic fallacies, circumventions and fraud.
Marketplace, not unilateral protection
So beyond being the wrong economic medicine, applied independently and unilaterally, consumer protection is also in violation of free-market principles. Because in the protection of marketplaces that adhere to free-market principles our forefathers envisioned for us, both demand and supply should enjoy similar and balanced measures that maintain the evolution of a self regulating dynamic meritocracy. Meaning, one aught not to stimulate or regulate one side of the economic marketplace, but apply transparency so the fallacies on either side can swiftly be dealt with by the marketplace itself.
The role of government is to enforce the compliance to free-market principles in every aspect of trade. To ensure that those who lend money are just as protected as those who borrow. That the success of those “marriages” are just as transparent as their failures, to all marketplace participants (buy and sell). The only meaningful form of consumer protection is the one offered by a free-market.
The American Dream
The pursuit of the American Dream will never materialize if we keep violating the founding vision and economic principles our most beloved forefathers bestowed upon us. We need to stop deploying a plethora of unilateral regulations favored by flip-flopping party lines meant to artificially achieve a desired - yet temporal - political economic outcome, that then quickly upon implementation or change of government control requires a new host of perpetual corrections. We need to look for answers upstream.
The American Dream can only be achieved if we deploy a level playing field, in which the merit of those who establish viable marketplace marriages thrives and those who abuse the marketplace by virtue of transparency get ignored. It may surprise you that the majority of our financial systems today are in violation of free-market principles (a topic I substantiate on my blogs further), and thus the reason why our economy buckles under the obesity of finance eleven times the size of production.
A real meritocracy, for once
The American Dream starts with a new responsibility the President has to take on. And that is to ensure bilateral compliance of our economic and financial systems to free-market principles that can then with the magnificent resources we have at our disposal act as the petri-dish for a bright new meritocracy, in which all of us have not a dream but the ability to thrive.
Say no thanks to consumer protection if you demand better. We need to help our President develop a new economic master plan and compass, and short of a viable product by his traditional economists, we as entrepreneurs - used to thinking upstream - grabbed the bull by the horns and are building one.
The musical chairs of asset management
Friday - December 02, 2011.
Read the complete article...
Pancake Economics
Thursday - November 03, 2011.
My discovery of the flaws in the fundamental deployment of risk in our economy means that its performance can be made highly predictable again and can be deployed by change everyone can understand, and believe in.
Read the complete article...
Fake tits and money
Tuesday - August 23, 2011.
Should we really be surprised those marriages produce even more dysfunctional "children", responsible for negative Limited Partner returns and a plethora of IPO bubbles?
Read the complete article...
The State of Debt
Friday - August 05, 2011.
This from a New York Times article: For years, the American financial sector borrowed and borrowed. Its obligations rose even more rapidly than consumers’. Both sectors were far more aggressive borrowers than the federal government. Now that has reversed. The Federal Reserve reported this month that the outstanding debts of both the financial sector and households fell in 2010, as they had in 2009.
Now if our government would get its act together of what its role is in a free-market (not free-for-all) economy, the trending would work out just fine.
Check out the article here
.We fail because we lie
Tuesday - August 02, 2011.
The silly political rambling about our national debt and the raising of our debt ceiling compounds the realization that our government too has failed, along with our economy and our financial systems. Our systems fail, not our tactics.
We need to treat our country more like a company, and our country lacks a viable business plan, a binding compass. We need to stop lying to ourselves to prevent us from reaching our full economic potential.
Read the complete article...
Bullish on the U.S.
Tuesday - June 07, 2011.
BlackRock, a $3 Trillion investment firm and a LP in Venture we have met with is bullish on the U.S.
We agree with Chief Equity Strategist Bob Doll that U.S. entrepreneurial capacity will continue to lead the world, despite the way we see a subprime financial system, or socialistic capitalism, suppressing innovation. Apple and Facebook are great examples of custodians of innovation that have escaped the wrath of Venture Capital and grown dramatically despite (not because of) the traditional playbook of Venture Capital.
I agree with Bob on some of the economics he mentioned, but remain a staunch critic of the deplorable and suppressive role of a defunct financial arbitrage. With a new financial system guiding innovation we could be doing a lot better. Yet our cultural capacity to innovate, despite the flawed economic principles of our financial system, escapes and keeps rising above its arbitrage. But looking inwards, as we have found out, is clearly not part of the interest or risk analysis of many financiers.
Interesting points:
Read the full article here: [Links: The Wall Street Journal
]
We agree with Chief Equity Strategist Bob Doll that U.S. entrepreneurial capacity will continue to lead the world, despite the way we see a subprime financial system, or socialistic capitalism, suppressing innovation. Apple and Facebook are great examples of custodians of innovation that have escaped the wrath of Venture Capital and grown dramatically despite (not because of) the traditional playbook of Venture Capital.
I agree with Bob on some of the economics he mentioned, but remain a staunch critic of the deplorable and suppressive role of a defunct financial arbitrage. With a new financial system guiding innovation we could be doing a lot better. Yet our cultural capacity to innovate, despite the flawed economic principles of our financial system, escapes and keeps rising above its arbitrage. But looking inwards, as we have found out, is clearly not part of the interest or risk analysis of many financiers.
Interesting points:
- U.S. productivity is "OK and better than lots of other places. Over the next 20 years, the U.S. work force is going to grow by 11%, Europe's going to fall by five, and Japan's going to fall by 17.”
- Half of the 2009 stimulus program was "true stimulus" for the economy. What about the rest? “Call your congressman and find out”
- “We face formidable long-term structural problems that make the U.S. less attractive than it otherwise might be.”
- In 1995 the U.S. produced roughly 25% of the world's goods and services and in 2010, after 15 years that included a tech bust, a terrorist attack and a housing bust that triggered a financial crisis, the U.S. was still producing that same 25% of global GDP
Read the full article here: [Links: The Wall Street Journal
]The stock market is not a free-market
Wednesday - April 06, 2011.
Afraid of Apple's impact on the stock market will be too large the Nasdaq re-balanced its 100 index. So much for a free-market system that is supposed to be self-regulating. Shares themselves are a short-seller derivative of a company's value, and an index is nothing more than a derivative of a derivative. I pity the fool who invests in them.
Do you really need more proof that stock markets are artificial markets, of which you or "the market" have no control?
America's financial statements
Thursday - February 24, 2011.
Venture Capital firm Kleiner Perkins (KPCB)
is trying to switch places with government by producing a report
describing their views on America's financial problems at a time when our government is trying to be an entrepreneur. Thankfully for both that switch will not need to occur, as the majority of our financial problems are related a simple origin: the free-markets of finance we have not. Let's stay focused on the reason for the avalanche, rather than trying to prevent the resulting snowballs. You in charge
Wednesday - February 16, 2011.
- The New York Times put up a fantastic budget puzzle that allows you to decide how to bridge a $418 Billion shortfall in 2015 and a $1.345 Trillion shortfall in 2030, given the current options on the table. Play and share.
$1B companies build GDP
Saturday - February 05, 2011.
- Carl Schramm, CEO of the Kauffman Foundation during the Startup America announcement at the White House confides the number of new $1B companies defines the health of our GDP, so therefor why are we building subprime technology companies funded by subprime VC funds who cannot fund anything but innovation socialism?
US World Debt
Thursday - February 03, 2011.
This map
shows leading foreign holders of United States Treasury Securities (at end of period - Nov 2010). Grand total: US $4,346.8 Billion.A clear signal as to why the government should stick to doing what it does best, govern the creation of new free-market systems, rather than infuse inefficient economic market constructs with more money and regulations. Because only efficient public markets can drive the recovery of the United States and wipeout this massive debt.
The State of Venture Capital
Wednesday - October 13, 2010.
Read the complete article...
Can we really blame the economy?
Friday - October 08, 2010.
Read the complete article...
Saving Silicon Valley
Wednesday - July 28, 2010.
Read the complete article...
New York, an empire state of mind
Thursday - January 21, 2010.
Read the complete article...
Why Venture Capital will not simply recover when the economy does
Friday - December 04, 2009.
Read the complete article...
Less is more; moving regulations from government to the marketplace
Wednesday - November 18, 2009.
Read the complete article...
The importance of being free-and-earnest
Tuesday - October 20, 2009.
Read the complete article...
How to remove the systemic risk of our economy
Thursday - September 10, 2009.
Read the complete article...
The Silicon Valley emperor has no clothes
Saturday - August 08, 2009.
Read the complete article...
Trust is the currency of success
Thursday - November 20, 2008.
Read the complete article...
Marketplace rules: look, don't touch
Sunday - March 16, 2008.
