Here's how the G20 sums it up: "During a period of strong global growth, growing capital flows, and prolonged stability earlier this decade, market participants sought higher yields without an adequate appreciation of the risks and failed to exercise proper due diligence. At the same time, weak underwriting standards, unsound risk management practices, increasingly complex and opaque financial products, and consequent excessive leverage combined to create vulnerabilities in the system. Policy-makers, regulators and supervisors, in some advanced countries, did not adequately appreciate and address the risks building up in financial markets, keep pace with financial innovation, or take into account the systemic ramifications of domestic regulatory actions."

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29264306)

One answer for you is that HFT might cause a liquidity crunch akin to the debt crunch felt in '08-'09. HFT seems to be displacing traditional market makers, but has this nasty tendency of disappearing completely when shit goes down. So maybe the equation is tech bubble burst + HFT liquidity disappearing = Great Recession #2.

I also know that secondary markets for non-public securities have become widely used. The actual trading of stock of a private company itself isn't terribly worrying, but you have to wonder if derivatives or some other instruments are cropping up (or will soon crop up) to juice returns even further.

Those are just two examples. There's probably something even more pernicious out there that I'm just not thinking of. The root of the problem, of course, is that too many market actors are working under the influence of terribly improper incentives. If they haven't already found a way to tangle things up again, given enough time with the right incentives they will certainly cook something up.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29264546)

you didnt address the principles, the big ideas behind this. you are a small idea kind of guy i sense, not a big picture guy.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29268994)

however there are also LOW risk places for a huge return if you know where to look

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29268386)

here's high risk: student debt, biotech equity, tech equity, coastal real estate, art, everything china, canada real estate, some muni debt.

what do you have in-mind that is safe over the long term?

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29268560)

But they also do the following things:

1. Benefit from rising rates

2. Have excess capital on their balance sheets

3. Easy to buy by a larger consolidator, benefit from scale

Also invest in way more simple less bizzaro risky wizard shit than the huge banks - major source of the risk

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29268786)

"... the American worker is also getting 'screwed' ... boards and CEOS have allowed property, plants and equipment of our companies to become the oldest on record and, as a result, the growth rate in productivity per hour of our workers has also become the worst on record and has actually decreased compared to last year.

The average age of corporate property, plants and equipment is an astounding 22.3 years, the oldest it has reached since 1941. But I do not believe that most boards and CEOs really give a damn. With many exceptions, CEOs only care about short term results. Perhaps you can't really blame them because unfortunately, Wall Street judges them based on quarter to quarter results and CEOs receive their egregious compensation based on those short-term results."

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29268559)

#2 - it's not really even true. just do an easy thought experiment. let's say there's a button someone in a Ford factory can push and 100 cars will pop out, created by robots. goddamn that's efficient, right?! that labor should really be fucking valuable, right? a guy who can push a button and make 100 cars! are you telling me this button pusher is going to be a millionaire? ljl fuck no. efficiency is only one side of a coin. labor supply matters too. and guess what. tech makes jobs so simple & efficient that there's suddenly a big fucking pool of qualified workers. a button pusher doesn't need to know shit about car making. HTFH.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29271352)

You raise an interesting point, and I'm not entirely positive you're wrong. It's possible that some technological changes are different in kind from the others such that they permanently destroy jobs. I can certainly entertain the notion. However, I'm inclined to think it's wrong. Even in the most stylized example -- your button that produces 100 cars -- if such a thing were to exist, a whole industry would crop up around servicing and improving those buttons. It's not like people would just kick their feet up and say "great, we've invented the button, now we never have to think about cars again." More importantly, though, even if fewer people tend to the business of making cars, that would just mean some people who previously built cars will have to find something else to pursue. Maybe it's tangentially related to producing cars -- after-market modifications of cars, for example -- or maybe it's totally different. Maybe it's building rockets for satellites. Maybe it's walking dogs. The thing is, there's an infinite number of things that need to get done, so once one gets crossed off the list, there will always be something else to turn one's attention to... And even if there wasn't, it's still a moot point policy. Like I said, the march of technological progress will continue whether you like it or not. The only real question is whether you will lead it or be left behind by it. There's no sense in burying your head in the sand and wistfully clinging to a bygone era.

Regarding your first point, it's not good for ANYONE if America's corporations and financial firms are being run inefficiently. First of all, employees with retirement or pension plans benefit to the extent that American firms are growing long-term -- which they can only do if they make prudent capital investments. Second, as I said before, any short-term disruption in the labor market can be compensation for by taxing some of the increase in profits from these prudent investments and setting up some sort of welfare or basic income program for the unemployed. Properly managed, it is categorically true that prudent capital investments will benefit workers. Instead of focusing your time & efforts demonizing technology, you should be focusing your efforts and building a robust safety net and making sure corporations are not able to elude taxation.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29272593)

and when some corporate raider "lucky few" generation billionaire is pushing an agenda, i want to flee in the opposite direction.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29270627)

Most of his rage is directed at companies that are being run like personal fiefs for the managerial class (a class of people who have successfully siphoned the wealth and progress gains made by corporations away from shareholders, pension funds, insurance companies, endowments etc) - and in the process made a lot of companies moribund.

Even though some of his involvement in companies results in downsizing - a lot of these companies could have gone bankrupt if he wasn't in there which would have resulted in 100% layoffs if you think about it.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29271334)

and when he talks about bad governance and empire building and corruption, he's really just talking about managers who aren't doing the things i listed above. so, my deduction is that he makes fair criticisms about corporate management, but it's all part of an agenda to make companies even worse.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29273168)

Let's think of it from another angle: Do you have a good explanation for why share buybacks have exploded recently at the expense of long-term investment? Has something happened in the world that has made innovation no longer cost effective? Or are corporations just being mismanaged by executives with every incentive to eek out whatever profit they can from what's currently in place, collect exhorbitant bonuses, and then leave empty husks of once-great companies in their wake?

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29271394)

Buying back shares also helps provide an outlet for capital that prevents companies from sprawling and buying random shit that could be idiotic and moneylosing (i.e "empire building" mergers like AOL-Time Warner).

It makes a lot of sense if you have 1. limited expansion potential, 2. nothing higher in the cap structure than common shares (like preferreds/debt) 3. if shares are trading at a substantial, significant discount.

That said, I would suspect that 75% of buybacks in the current environment are malinvestment because of how cheap debt is to get. IMO companies should have been attempting to get debt free vs. goosing their profitability metrics via buybacks when its clear management has a limited understanding of intrinsic value of companies.

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29271549)

There is no correlation with the number of pages of regulations and lack of recessions

(http://www.autoadmit.com/thread.php?thread_id=3055586&forum_id=2#29273151)