Yes, I know I wrote it. But beginning, middle, end, argument, facts and a couple of jokes.
The reason this is so important is that only with that general trust across the society can investment be made across the society. My savings go, in part, into a factory I’ve never been to, run by people I’ll never meet. If who I can trust is restricted to my family (and who really trusts all their cousins?) then a business can only be as large as the family can finance. Or perhaps we move out a little further, to the extended family or clan — but that would make us Pakistan.
The entire point of a stock market — of financial markets, more generally — is that we can assemble and then allocate the savings of millions across thousands of projects. This is only going to work if we can trust the system in general. Yes, of course, some of those projects will fail, some of those savings will be lost. But the system as a whole works and it’s that system — the mobilization of savings into investment — that makes our future richer.
Fraudsters in this system? Their crime isn’t just against those whose money they stole, it’s against the very system itself. Thus the punishment should not be the usual rap on the knuckles given to those who steal with paper. It should be a monstrous revenge precisely because of the danger to the whole economic structure.
Deffo in hte say so myself class but still…..
Well in that case you should be in favour of severe penalties for the sort of people who abuse limited liability companies, and controls on who can get them, and how much it costs to do so, but you aren’t…….
’…but that would make us Pakistan.’
*munches popcorn*
Glad to see you got that. Do note it’s for a Bangladeshi newspaper – they love that sort of thing about Pakistan. No love lost there at all….
I am in favour of severe penalties for people who abuse financial markets. Given expert evidence in several trials that have sent fradusters down for 6-8 years.
Next!
“I am in favour of severe penalties for people who abuse financial markets. Given expert evidence in several trials that have sent fradusters down for 6-8 years.”
Thats not the same thing as the abuse of the limited liability company system that takes place every day with no one ever seeing the inside of a court room.
Jim is Richard Murphy and I claim my £5.
“Jim is Richard Murphy and I claim my £5.”
F*ck off.
“Thats not the same thing as the abuse of the limited liability company system that takes place every day with no one ever seeing the inside of a court room.”
this has fuck all to do with stock markets
Yep Trust is important. It no doubt accounts for for much of the disparity of economies between Northern & Southern Europe. Northern European societies are trust based societies. Southern European, far less so. There’s a clothes shop just along from where I live, has the window boldly signed “Everything under 10€”. Go in there, & indeed much is 10€ or less. But most over. If you can find the very small price tag on the article. Many don’t even have that. You find the price when you get to pay. The property agent will tell you that flat looks so good in the photos is a hundred metres from the beach. It may be half a kilometre or more. (Or in one case, the half klick plus the 4 klick drive around the impeding railway line)
It means everything you have to do is harder because you’re constantly having to check the veracity of what you’re told or finding that the outcome of choices is less than optimum. So is it any surprise the economy is less efficient? Unfortunately, anyone who’s lived in London the last few decades will tell you it & many other UK cities are are going the same way. The result of wholesale immigration from low trust societies. Particularly the one that Tim mentions (Although I wouldn’t say the Banglas are much different) Go look at a court list & see what sort of names so regularly turn up.
There was a century in Great Britain where 1 in 50 males got executed. Can’t remember which one, but it was on the internet.
Now GB isn’t the highest trust place in the world, possibly Japan, Scandinvians, the northern USA states (with high Scandi descendants) have that distinction. So how did they do it, get to being trusting of strangers they’d never met. Did they execute a greater % of wrong ‘uns before they procreated.
I’ve read the city states’ laws against cousin marriage in Europe implemented in the middle ages which correlates with later prosperity, ‘cos you’re going to interact and trade with people further away, but there must be more to building a high trust gaffdom.
There was a century in Great Britain where 1 in 50 males got executed.
Sounds highly unlikely. For most of history 90% & up of the population were working on the land. So small villages. What would you have done in a small village likely to get you executed? Wouldn’t be theft, firstly there’d be little to steal & secondly, how you benefit from theft when everyone around knows your business & what you’re supposed to have?
OT
Found this interesting: https://www.telegraph.co.uk/business/2023/11/04/britain-commercial-property-market-downturn/
At the root, it’s over regulation. A long period of imposed artificially low interest rates. Energy certificate requirements & the cost of meeting the standards. And, of course, the Covid regulated lockdown & changing work patterns resulted.
Yet another area where government seems determined to reduce rather than increase productivity. Eventually it’s going to kick the economy into a cycle of doom because falling productivity is a self feeding loop. Falling productivity will equal less consumption & therefore less demand & less production required. Get used to being poor, I’d say.
Back on topic. Is there anything less trustworthy than a politician?
“There was a century in Great Britain where 1 in 50 males got executed.”
What BiS said… capital punishment, even corporeal punishment, wasn’t really all that common, especially outside the large cities.
Not for theft or fraud anyway. It was generally seen as more productive/useful to bleed the perpetrator for money and/or labour than to kill them..
Could be that some centuries did get to that 2% on average, but then that’d be the ones on the Losing Side in any one of the Internal Islander Wars who failed to die on the battlefield outright. In bulk.
Not ordinary criminals.
But even the 17th/18thC , when the beaks tended to be quite Hang-Ho, you’d be hard put to get up to that many.
Before that… certainly not. And the 19thC neither.
I wonder what would happen to that high-trust society when you import millions of low-trust society people?
“this has fuck all to do with stock markets”
What do you think makes up the stock markets? Limited liability companies of course. Many of the smaller ones on things like AIM are basically frauds. And thats just the ones who make it to a listing. There’s millions of LLCs extant in the UK, the vast majority of which have no economic use whatsoever other than as conduits for fraud. And the vast vast majority of those perpetrating those frauds are never held to account. The whole system brings business and capitalism into disrepute. Its no surprise the public think businessmen are one step above conmen, because in many cases they ARE conmen, and the limited liability system facilitates and protects their frauds.
Jim: “There’s millions of LLCs extant in the UK, the vast majority of which have no economic use whatsoever other than as conduits for fraud.”
What is your evidence for this? How can you or any one person know what millions of companies are doing and whether it is fraudulent or not?
I wonder what would happen to that high-trust society when you import millions of low-trust society people?
Well I can think of one group of newcomers who often seem less than honest. Despite a a favoured phrase being “You can trust me, my friend.” Even when you’ve only known them for five minutes.
Although I’m inclined to believe they think themselves as entirely honourable. But they have a different view of the world. That car they’re offering you for sale may only have three wheels & a shot engine but everything is as Allah wills it. And Allah may well will it to have four wheels with unused tyres & a new motor if you choose to buy it. And if He (pbuh) doesn’t, it’s hardly the seller’s fault.
Found an approximation for it:
16th century England (population around 3m at the time if Wales included)
Approx 72,000 executed
https://historywithhenry.com/how-many-people-did-henry-viii-execute
The tentative theory is that if you’re executing all the low trust people before they breed, then over time you’ll raise the average.
Done a little prison visiting in my time, and the scum all seem to have kids, obviously we’re not locking them up early enough. Gawd knows what the next generation or two of them will be like.
I’m not so sure now as Henry 8ths time sounds more like tyranny, but still a lot of wrong ‘uns dispensed with.
If that’s 72k over 100 years, then assuming constant population over that century it’s an execution rate of 0.02% (720 per year of 3m)
“What is your evidence for this? How can you or any one person know what millions of companies are doing and whether it is fraudulent or not?”
https://www.hamhigh.co.uk/news/21352183.derelict-finchley-road-office-home-tens-thousands-firms—unwittingly-linked-mafia-dictators-fraud/
https://www.itv.com/news/wales/2023-05-18/twelve-thousand-tax-bills-sent-to-one-address-branded-mystery-by-hmrc
https://www.mirror.co.uk/news/uk-news/your-home-address-been-hijacked-27768738
But hey, I bet all those companies were all legit businesses bringing in billions in trade for the UK………
Simplified model:
Henry VIII reigned for 38 years – call that life expectancy at that time.
So 3 million population of that time was a different 3 million 38 years later – awful model as some didn’t make it past teens, and some made it to their 70s, but call that 3 million human lifetimes during Henry VIIIs reign.
He executed 60k men and 12k women, guessing, for a total of 72k executions.
For the men, your chances of dying were 100% in this model and of the mode of death being capital punishment it was 4%. Hth.