> Nothing in life is free. The gov't can't just print money and hand it out. "Money" doesn't work that way. It must be backed by productivity, otherwise you have Weimar or Zimbabwe.
Yep, so a UBI must be backed by appropriate taxes. A UBI cannot be backed by simply printing money.
It's that the negative externalities of burning fossil fuels aren't included in the price. If we added pigovian taxes to the burning of coal/oil, this would be reflected in the price of energy, and we would see an appropriate adjustment in the amount of bitcoin mining.
Pigovian taxes on fossil fuels are the answer here, and will return the market to free market efficient allocations of resources.
Of course those criticisms are from experts... but that is not the mainstream or 99.9% of the problem we are looking at.
You might as well be quoting criticisms of quantum mechanics to explain why heavier than air vehicles can't fly...
You are ignorant of the VERY FUCKING BASICS of the subject you are trying to act like an expert in.
UBI is a concrete implementation of the second theorem. It means we can have all the benefits of capitalism (via the first), and from the optimal outcomes that that produces, select from the set that have no poverty in them, by the second!
Not only is this not likely to slow the economic growth, it is likely to increase it, as wealth torrents up faster than it trickles down.
If you are saying UBI is impossible or harmful to the economy, you are basically arguing against experts like Milton Friedman.
You are no Milton Friedman... you aren't even a reasonably knowledgeable lay person. Your ignorance harms everyone.
You just used the same argument everyone completely ignorant of the fundamentals of economics uses...
You argue from the critisisms sections of a wikipedia article like no economist has ever considered these things.
Before you go stating that UBI is impossible because of your great understanding of economics, perhaps you should ACTUALLY know the VERY basic FUNDAMENTALS of microeconomics.
How about that?
You think your arguments can make up for actual knowledge? This isn't flat earth debate club fuckhead... you're supposed to have actual understanding of the topic first.
In economics, there are only two FUNDAMENTAL THEOREMS... everyone agrees with them... and you know neither.
You don't time in your equations when talking about equilibrium outcomes... We know that anything else produces less than those outcomes... So, optimal growth is included IMPLICITLY in the facts that they are provably optimal allocations.
You need a first semester economics students understanding of economics before you argue against the SOLUTION TO POVERTY! You don't even have that.
Stop your ignorance and study something on coursera.
If you want to understand why you are so incredibly wrong on everything you write... study enough economics that you can explain the second fundamental welfare theorem.
UBI is well supported by economic theory.
It is not money for nothing, it is the most efficient system of redistribution of wealth to ensure social security without compromising the efficiencies and benefits of free market capitalism.
> with AI technologies making it "easier" for humans to carry out tasks
This means fewer people being worked just as hard as always, for the same pay as always. The extra created efficiency will simply mean even more pay for the executive and capitalist classes.
New jobs will be created, but people will simply be unable to be reskilled, and so we will see generations of unemployed created, because it will be the next generations that will be able to learn the new skills.
The extra efficiency would be beneficial for the whole of society, but only if we had a way to redistribute those gains to everyone instead of just the very few.
A Universal Basic Income would ensure that the benefits of AI go to everyone, who can then use the money to either survive, for leisure, retraining, etc... The capitalists will still benefit, but everyone will be better off as AI advancements and disruptions occur.
> A producer who makes $1000 per widget will happily pay a $100 tax when the production of that widge actually creates $300 in damage
But if they are taxed $300 per widget, then they would be producing the 'optimal' amount of widgets and damage. It's really as simple as that.
> It just needs to be 100% responsible for cleaning them up.
No it doesn't... it just needs to be taxed appropriately. That's the unexpected outcome of this proof.
> Without near realtime measurement and feedback of the ongoing externality damage created with ongoing real costs calculated...
There is an estimation problem... that's true... but the market approaches a free market outcome as the estimation is improved... So, it doesn't have to be perfect, but the better the estimation, the closer the market is to a free market.
Seriously... do a fundamentals of microeconomics course online... and you will see why this is so important.
Otherwise, what is your solution? Stop any economic activity that causes any negative externalities? So... no industry, transport, hospitals or anything? Kill all the humans? You don't even have a starting point to have a rational approach to any of these problems. And you could do this in just a couple of months. Stop being lazy and learn the truth.
Summarising wikipedia's criticisms here does not demonstrate that you actually understand what you are talking about...
You are too ignorant of the topic for me to educate you any further...
Suffice to say, this is how you internalise the costs of externalities into the price. This is all you need to do. It's not a good idea to generate no externalities, what is important is that they are not over produced. (or else, turn off all your lights, your computer, don't drive, or live in a house or eat...).
> Please study microeconomics. It's your only hope!
It's clear you haven't... you don't even know what an entry level econ student knows, yet you think your ignorance is your strength. You're literally speaking out of your ass.
The fact that you think "free market" means "without regulation" proves you are a fucking idiot (though a common one).
FREE MARKETS ARE REGULATED TO BE FREE
Please educate yourself. You're the reason your society is vulnerable to the idea that lack of regulations (and its cousin, wrong regulations) are a "good idea (tm)". You are so ignorant and brainwashed that you argue for own slavery, for what is the opposite of free?
> How do you prevent the socializing of externalities in a "free market" without regulation that actually works?
How do you REGULATE externalities in a market to make it free? (FTFY)
> The "Free Market" does not exist in the real world.
No, it doesn't... no market is a TRUE free market. Markets have imperfect competition, imperfect information and externalities. Only an idiot would argue otherwise.
So, why even bother talking about free markets?
> It's a thought exercise. A fairy tale.
Because we have a proof that free markets have some properties that are extremely good... basically that free markets produce 'optimal' outcomes... Or rather, if these three properties are violated, then we can make people better off without making anyone else worse off by correcting for them (First Fundamental Theorem of Microeconomics).
It's not that we think that free markets exist naturally, but that we should regulate markets so that they are as free as possible. Microeconomics tells us what regulations help, and which ones make things worse (there are ONLY three things we have to regulate for).
Free Markets are a GOOD thing. Your definition of Capitalism is correctly pointing out the ways that markets are NOT free... and why capitalism needs to be regulated to be free.
The Second Theorem suggests we have a UBI in a Free Market!!
Please study microeconomics. It's your only hope! (I know you think you're smart pointing out how Free Markets don't exist, but you don't even understand why we should have free markets in the first place).
Front running is placing an order BEFORE the other order hits the queue because you know the order ahead of time.
HFT bots KNOW about an order before anyone else AFTER it has hit the queue.
One is illegal, the other is efficient.
ARBITRAGE IS GOOD FOR EVERYONE!
NOW FUCK OFF WITH YOUR IGNORANCE.
For example, let's say you did all your trading based on last years prices with no knowledge of the current state of the market? Are you efficient? No!!! HFT is that in the limit.
> Except that there is no such thing as a free market in reality,
What we have are varying degrees of divergence from it.
As the mathematics prove, everybody is better off in a free market, so this suggests that we do everything in our power to move from our non free, real market, towards free market like at every possible opportunity.
(It's like the frictionless surface in physics, sometimes we need to use oil).
Either way, the market has a clearing price regardless of the market freeness.
> There is no such thing as an objectively-"correct" price for anything.
What we have instead is the market clearing price. Which no one can manipulate in a free market (per microeconomic definition, when certain conditions are met - perfect competition, perfect information, no externalities).
The price of something is the intersection of supply and demand. Individuals make value judgments subjectively. But the market clearing price in a free market is an objective outcome from these subjective valuations.
> There's no physical law which governs economics.
Indeed. Economics transcends physics in that the laws of physics could have been different (might be in alternative universes), but the results of free market microeconomics are in fact *mathematical* theorems.
These theorems apply whenever there are limited resources and agents must make mutually exclusive choices between them.
NO THEY DO NOT! I stopped reading here, because HFTs DO NOT FRONT RUN! They have much faster access to the market than everyone else, but they do not have access to privileged (illegal) information (orders BEFORE they hit the queue). They cannot see a trade before it is on the market, only a tiny fraction of a second after it is on the market, and this makes all the difference.
What I skimmed of your post just shows you are totally clueless on this topic and should stfu because you are embarrassing yourself.
For example:
> This is normally called "insider trading"
Is more proof that you are ignorant on this matter. It's not insider trading. That again is where you have privileged information.
The truth of the matter is that we should be able to put in billions of trades per nanosecond and cancel each of them half a nanosecond later, and this at worst has no negative effect on the operation of the market (technical considerations aside) but can only have positive effects for other traders.
Anyone should be able to put up trades and cancel them as they wish... They are normally charged with "price manipulation" actually, but you really shouldn't let unmatched orders have too much influence on your pricing... Ironically, it is the HFT bots, that can be most easily gamed this way, and we should allow that!
Please learn how actually markets operate. There are two opposing queues full of orders, and a trade only occurs when two opposing orders disagree on the price in opposite directions (one wants to buy at a higher price than the other wants to sell at). Millions of placed and cancelled trades have no effect on that mechanism... And when they match, it was always because they were the BEST available option for the trader who was opposing them. Without them, BY DEFINITION, the opposing trade either would not get matched or would get matched at a worse price! They are poorer without the HFT "in the middle" as you might say.
I believe that it is a very close approximation to the truth.
All the EMH says is that the price of a stock reflects all available knowledge about the value of that stock. When it doesn't, it means that people have information about the stock that is NOT currently reflected in the price, which means there is an opportunity for them to provide that information and profit. So markets provide the incentive to provide them with information, and should therefore tend towards efficiency. The further from the EMH the price is, the more incentive there is for traders to make it efficient.
So, while a market cannot ever be *perfectly* efficient, it will tend towards greater efficiency, assuming it is regulated inline with the assumptions of the free market (not always true), because there are incentives, in the forms of profit, to provide that information.
An example might be the price of bitcoin. Currently at about $6000/coin. Will the price go up or down in the future? We can't tell, because the current price reflects all the beliefs about its future value too. It might be worth $1M/btc or zero in a decade's time. All we can say is what the market believes the value of it is right now. So, an efficient market price is just as likely to increase as it is to decrease!
I think, rather, as someone who hasn't actually studied the field, why you think it is (grossly) false, when you can find out why economists generally believe it (approximately) for yourself.
It's true in the limit... but it can never be *exactly* true, because information can not travel faster than the speed of light.
Markets use money as information signals. This information allows markets to allocate resources that maximise social welfare surplus (utility) (aka first fundamental theorem of microeconomics). Therefore the closer to the limit, the more efficient the market, the better.
Thus we should allow trading bots of all kinds to place and cancel orders as fast as our systems allow, and the market will allocate money to them in proportion to the value of information they bring to the market. As long as they are not *front running* orders, they must be a positive on the market.
You have to understand that exchange markets are the ultimate expression of "Free Market" (from microeconomics) trade. Nobody is forced to trade, and by definition, every time a trade occurs it is because two traders *wanted* to make that trade.
Instead of thinking that HFT takes money away from people, you can think of it as making *more* money available, at *better* prices, and more *often* than without them.
The *only* way to have a trade on an exchange is by offering a better opposing trade to *everyone* else in the market at the time of the trade. By definition, the more players, include HFT players, the more *efficient* the market.
They aren't taking away anything from anybody else, because no one else was offering a better deal at the time.
So, the best thing we can do, actually, is let the BEST traders take the most money, because they provide the most "information" to the market in the form of MONEY! MONEY is MARKET INFORMATION... and the market allocates money exponentially to those who provide the best information... HFT's earn their profits, except when they are locking up their competitors (because they actually provide better estimates of the true price to the market).
> It intercepts information before other traders can csee it
Information is a commodity.
They do take risk (except that they *arrest* their competitors).
We should encourage HFT, but accept that people and bots might place trades they do not necessarily intend to be filled, even though they in fact might be.
Slashdot Mirror
> Nothing in life is free. The gov't can't just print money and hand it out. "Money" doesn't work that way. It must be backed by productivity, otherwise you have Weimar or Zimbabwe.
Yep, so a UBI must be backed by appropriate taxes. A UBI cannot be backed by simply printing money.
It's that the negative externalities of burning fossil fuels aren't included in the price. If we added pigovian taxes to the burning of coal/oil, this would be reflected in the price of energy, and we would see an appropriate adjustment in the amount of bitcoin mining.
Pigovian taxes on fossil fuels are the answer here, and will return the market to free market efficient allocations of resources.
http://theconversation.com/spray-on-antennas-unlock-communication-of-the-future-103637
Of course those criticisms are from experts... but that is not the mainstream or 99.9% of the problem we are looking at.
You might as well be quoting criticisms of quantum mechanics to explain why heavier than air vehicles can't fly...
You are ignorant of the VERY FUCKING BASICS of the subject you are trying to act like an expert in.
UBI is a concrete implementation of the second theorem. It means we can have all the benefits of capitalism (via the first), and from the optimal outcomes that that produces, select from the set that have no poverty in them, by the second!
Not only is this not likely to slow the economic growth, it is likely to increase it, as wealth torrents up faster than it trickles down.
If you are saying UBI is impossible or harmful to the economy, you are basically arguing against experts like Milton Friedman.
You are no Milton Friedman... you aren't even a reasonably knowledgeable lay person. Your ignorance harms everyone.
Oh shit you got me!!!
You just used the same argument everyone completely ignorant of the fundamentals of economics uses...
You argue from the critisisms sections of a wikipedia article like no economist has ever considered these things.
Before you go stating that UBI is impossible because of your great understanding of economics, perhaps you should ACTUALLY know the VERY basic FUNDAMENTALS of microeconomics.
How about that?
You think your arguments can make up for actual knowledge? This isn't flat earth debate club fuckhead... you're supposed to have actual understanding of the topic first.
In economics, there are only two FUNDAMENTAL THEOREMS... everyone agrees with them... and you know neither.
You don't time in your equations when talking about equilibrium outcomes... We know that anything else produces less than those outcomes... So, optimal growth is included IMPLICITLY in the facts that they are provably optimal allocations.
You need a first semester economics students understanding of economics before you argue against the SOLUTION TO POVERTY! You don't even have that.
Stop your ignorance and study something on coursera.
Or enjoy your position in the ignorati.
> There's no time variable.
What's that there about equilibrium outcomes?
Time is implicit in that.
Try again. You just proved your ignorance.
If you want to understand why you are so incredibly wrong on everything you write... study enough economics that you can explain the second fundamental welfare theorem.
UBI is well supported by economic theory.
It is not money for nothing, it is the most efficient system of redistribution of wealth to ensure social security without compromising the efficiencies and benefits of free market capitalism.
> with AI technologies making it "easier" for humans to carry out tasks
This means fewer people being worked just as hard as always, for the same pay as always. The extra created efficiency will simply mean even more pay for the executive and capitalist classes.
New jobs will be created, but people will simply be unable to be reskilled, and so we will see generations of unemployed created, because it will be the next generations that will be able to learn the new skills.
The extra efficiency would be beneficial for the whole of society, but only if we had a way to redistribute those gains to everyone instead of just the very few.
A Universal Basic Income would ensure that the benefits of AI go to everyone, who can then use the money to either survive, for leisure, retraining, etc... The capitalists will still benefit, but everyone will be better off as AI advancements and disruptions occur.
Do you even second welfare theorem you fucking idiot?
I've done the maths, but you not so much.
NB: Jeff is on record as supporting a UBI, which will go a long way to helping ALL the poor and homeless people.
What ever else he does with his money is his business if it is not harming anyone.
That alone is more charity than most billionaires ever do.
> A producer who makes $1000 per widget will happily pay a $100 tax when the production of that widge actually creates $300 in damage
But if they are taxed $300 per widget, then they would be producing the 'optimal' amount of widgets and damage. It's really as simple as that.
> It just needs to be 100% responsible for cleaning them up.
No it doesn't... it just needs to be taxed appropriately. That's the unexpected outcome of this proof.
> Without near realtime measurement and feedback of the ongoing externality damage created with ongoing real costs calculated...
There is an estimation problem... that's true... but the market approaches a free market outcome as the estimation is improved... So, it doesn't have to be perfect, but the better the estimation, the closer the market is to a free market.
Seriously... do a fundamentals of microeconomics course online... and you will see why this is so important.
Otherwise, what is your solution? Stop any economic activity that causes any negative externalities? So... no industry, transport, hospitals or anything? Kill all the humans? You don't even have a starting point to have a rational approach to any of these problems. And you could do this in just a couple of months. Stop being lazy and learn the truth.
Please study the subject...
Summarising wikipedia's criticisms here does not demonstrate that you actually understand what you are talking about...
You are too ignorant of the topic for me to educate you any further...
Suffice to say, this is how you internalise the costs of externalities into the price. This is all you need to do. It's not a good idea to generate no externalities, what is important is that they are not over produced. (or else, turn off all your lights, your computer, don't drive, or live in a house or eat...).
> Please study microeconomics. It's your only hope!
It's clear you haven't... you don't even know what an entry level econ student knows, yet you think your ignorance is your strength. You're literally speaking out of your ass.
The fact that you think "free market" means "without regulation" proves you are a fucking idiot (though a common one).
FREE MARKETS ARE REGULATED TO BE FREE
Please educate yourself. You're the reason your society is vulnerable to the idea that lack of regulations (and its cousin, wrong regulations) are a "good idea (tm)". You are so ignorant and brainwashed that you argue for own slavery, for what is the opposite of free?
> How do you prevent the socializing of externalities in a "free market" without regulation that actually works?
How do you REGULATE externalities in a market to make it free? (FTFY)
Pigovian Taxes. You should know this!
EOT.
> The "Free Market" does not exist in the real world.
No, it doesn't... no market is a TRUE free market. Markets have imperfect competition, imperfect information and externalities. Only an idiot would argue otherwise.
So, why even bother talking about free markets?
> It's a thought exercise. A fairy tale.
Because we have a proof that free markets have some properties that are extremely good... basically that free markets produce 'optimal' outcomes... Or rather, if these three properties are violated, then we can make people better off without making anyone else worse off by correcting for them (First Fundamental Theorem of Microeconomics).
It's not that we think that free markets exist naturally, but that we should regulate markets so that they are as free as possible. Microeconomics tells us what regulations help, and which ones make things worse (there are ONLY three things we have to regulate for).
Free Markets are a GOOD thing. Your definition of Capitalism is correctly pointing out the ways that markets are NOT free... and why capitalism needs to be regulated to be free.
The Second Theorem suggests we have a UBI in a Free Market!!
Please study microeconomics. It's your only hope! (I know you think you're smart pointing out how Free Markets don't exist, but you don't even understand why we should have free markets in the first place).
This is how they are defined in microeconomics...
So, only me and every economist on earth.
No, free markets have a very specific definition.
They are markets with:
- perfect competition.
- perfect information.
- no externalities.
That's it.
Front running is placing an order BEFORE the other order hits the queue because you know the order ahead of time.
HFT bots KNOW about an order before anyone else AFTER it has hit the queue.
One is illegal, the other is efficient.
ARBITRAGE IS GOOD FOR EVERYONE!
NOW FUCK OFF WITH YOUR IGNORANCE.
For example, let's say you did all your trading based on last years prices with no knowledge of the current state of the market? Are you efficient? No!!! HFT is that in the limit.
> Except that there is no such thing as a free market in reality,
What we have are varying degrees of divergence from it.
As the mathematics prove, everybody is better off in a free market, so this suggests that we do everything in our power to move from our non free, real market, towards free market like at every possible opportunity.
(It's like the frictionless surface in physics, sometimes we need to use oil).
Either way, the market has a clearing price regardless of the market freeness.
> There is no such thing as an objectively-"correct" price for anything.
What we have instead is the market clearing price. Which no one can manipulate in a free market (per microeconomic definition, when certain conditions are met - perfect competition, perfect information, no externalities).
The price of something is the intersection of supply and demand. Individuals make value judgments subjectively. But the market clearing price in a free market is an objective outcome from these subjective valuations.
> There's no physical law which governs economics.
Indeed. Economics transcends physics in that the laws of physics could have been different (might be in alternative universes), but the results of free market microeconomics are in fact *mathematical* theorems.
These theorems apply whenever there are limited resources and agents must make mutually exclusive choices between them.
> The "better deal" was intercepted by the HFT
NO THEY DO NOT! I stopped reading here, because HFTs DO NOT FRONT RUN! They have much faster access to the market than everyone else, but they do not have access to privileged (illegal) information (orders BEFORE they hit the queue). They cannot see a trade before it is on the market, only a tiny fraction of a second after it is on the market, and this makes all the difference.
What I skimmed of your post just shows you are totally clueless on this topic and should stfu because you are embarrassing yourself.
For example:
> This is normally called "insider trading"
Is more proof that you are ignorant on this matter. It's not insider trading. That again is where you have privileged information.
The truth of the matter is that we should be able to put in billions of trades per nanosecond and cancel each of them half a nanosecond later, and this at worst has no negative effect on the operation of the market (technical considerations aside) but can only have positive effects for other traders.
Anyone should be able to put up trades and cancel them as they wish... They are normally charged with "price manipulation" actually, but you really shouldn't let unmatched orders have too much influence on your pricing... Ironically, it is the HFT bots, that can be most easily gamed this way, and we should allow that!
Please learn how actually markets operate. There are two opposing queues full of orders, and a trade only occurs when two opposing orders disagree on the price in opposite directions (one wants to buy at a higher price than the other wants to sell at). Millions of placed and cancelled trades have no effect on that mechanism... And when they match, it was always because they were the BEST available option for the trader who was opposing them. Without them, BY DEFINITION, the opposing trade either would not get matched or would get matched at a worse price! They are poorer without the HFT "in the middle" as you might say.
I believe that it is a very close approximation to the truth.
All the EMH says is that the price of a stock reflects all available knowledge about the value of that stock. When it doesn't, it means that people have information about the stock that is NOT currently reflected in the price, which means there is an opportunity for them to provide that information and profit. So markets provide the incentive to provide them with information, and should therefore tend towards efficiency. The further from the EMH the price is, the more incentive there is for traders to make it efficient.
So, while a market cannot ever be *perfectly* efficient, it will tend towards greater efficiency, assuming it is regulated inline with the assumptions of the free market (not always true), because there are incentives, in the forms of profit, to provide that information.
An example might be the price of bitcoin. Currently at about $6000/coin. Will the price go up or down in the future? We can't tell, because the current price reflects all the beliefs about its future value too. It might be worth $1M/btc or zero in a decade's time. All we can say is what the market believes the value of it is right now. So, an efficient market price is just as likely to increase as it is to decrease!
I think, rather, as someone who hasn't actually studied the field, why you think it is (grossly) false, when you can find out why economists generally believe it (approximately) for yourself.
It's true in the limit... but it can never be *exactly* true, because information can not travel faster than the speed of light.
Markets use money as information signals. This information allows markets to allocate resources that maximise social welfare surplus (utility) (aka first fundamental theorem of microeconomics). Therefore the closer to the limit, the more efficient the market, the better.
Thus we should allow trading bots of all kinds to place and cancel orders as fast as our systems allow, and the market will allocate money to them in proportion to the value of information they bring to the market. As long as they are not *front running* orders, they must be a positive on the market.
You have to understand that exchange markets are the ultimate expression of "Free Market" (from microeconomics) trade. Nobody is forced to trade, and by definition, every time a trade occurs it is because two traders *wanted* to make that trade.
Instead of thinking that HFT takes money away from people, you can think of it as making *more* money available, at *better* prices, and more *often* than without them.
The *only* way to have a trade on an exchange is by offering a better opposing trade to *everyone* else in the market at the time of the trade. By definition, the more players, include HFT players, the more *efficient* the market.
They aren't taking away anything from anybody else, because no one else was offering a better deal at the time.
So, the best thing we can do, actually, is let the BEST traders take the most money, because they provide the most "information" to the market in the form of MONEY! MONEY is MARKET INFORMATION... and the market allocates money exponentially to those who provide the best information... HFT's earn their profits, except when they are locking up their competitors (because they actually provide better estimates of the true price to the market).
> It intercepts information before other traders can csee it
Information is a commodity.
They do take risk (except that they *arrest* their competitors).
We should encourage HFT, but accept that people and bots might place trades they do not necessarily intend to be filled, even though they in fact might be.
Please learn how markets work.