Gifted Issues Discussion homepage Forums General Discussion NYT opinion: No (rich) child left behind

The thing about being rich is that they have a great many things they certainly don't need, and mortgages are among them.

Of course, at some point along the economic scale, debt (which is bad) changes its name to leverage (which is good).

I agree with this, but maybe my friends are just very self-selected. I also went a college that is selective (top 20) but whose graduates earn relatively low salaries due to making "hippie" life choices. It's a big issue for the endowment.

I know a LOT of highly intelligent people who have chosen not to maximize their earning potential for various reasons. My DH could make a lot more money were he to "sell out" his specialized skills, but he chooses not to because he couldn't live with himself if he did.

Leverage is one of the easiest ways to create or to deplete a great fortune. It's all a bit like gambling, isn't it?

At some point in the wealth scale, it becomes more about safeguarding wealth for future generations and less about courting financial risks to acquire additional wealth...at least in families that have managed to retain their wealth over three generations.

It would be interesting to see how childrearing practices and values differ in old money families as compared to new.

Businesses are run to profit their owners, but they do so (by and large) by producing efficiently what people want. That is no more problematic than workers choosing jobs and consumers choosing products to maximize their own welfare. I don't see why the pursuit of self-interest by some economic actors and not others should be criticized.

Except that this system now has a closed feedback loop that doesn't always include end-consumers as a major input.

That is, CEO/Board/stockholders/analysts reflect one another, and listen to one another, thereby manipulating the stock price of the company depending upon how happy the analyst(s) are based upon...

well, often it has relatively little to do with the company's nominal profitability/consumer satisfaction/market share, or productivity within corporate divisions. It's all speculative, and not terribly long-range in terms of the company or its customer base. That forecasting is also not very accurate-- perhaps not even as good as weather predictions in a ten day forecast. An extra penny of profit weighed against vanishing customer satisfaction/loyalty/reliability is just an extra penny... but it really isn't, if you looked longer term, because eventually that will be lost market share.

This actually is only recently my own opinion. I used to believe exactly what you're saying, Bostonian.

It's something that my FIL (himself a retired banking exec who lived through the S&L meltdown) has been bemoaning (okay, okay, more like ranting...) for YEARS-- that there is a huge reality and ethics breach opening ever-further in that particular analyst centric loop that controls corporate decision-making. I confess, it wasn't until after 2008 that I began to see what he was talking about-- that companies are increasingly about pandering (really, no other word is accurate) to stock analyst whims rather than making their own decisions about what might be good for the company, its employees, and its customers. He's convinced that MBA's need to start taking ethics again, and that it may well be time for additional market regulations... probably starting with firewalling off i-banking again.


I am not well-informed enough to know what the solution is, but I can certainly see that he's right about the feedback loop part of things. Not sure if that is the "cause" of any particular dysfunction, but it sure seems a little like a crazy way to run a capitalist market given my meager understanding of economics.

I think that would definitely be interesting.

I would also be interested to see the "working" versus "non-working" financial elite's practices, there.

Agreed, and would add that jail time is appropriate for a lot of these people. But not at a Club Fed facility. No, these folks need to spend time at a place with all the charm of NYC's Club Riker's.

Don't worry.

The Fed, through it's QE program, is removing any risk of a declining stock market at the present time.

So your investments are safe.

But the point of having all that success is so that you can privatize the gains and socialize the losses.

It's the Golden Rule!

He who has the gold makes the rules.

Plus, you can't lose money in the stock market anymore, so it's all good.

Capitalism is fixed, now.

Capitalism is fixed, now.

Oh, wait-- was that a complete thought? Thought it might have been a typo and was waiting for the edit and ending to that sentence. Bated breath, even.



ETA: just to clarify, though-- I thought that socialism was synonymous with "evil incarnate."

I guess losses and socialism, though... lesser of two evils, right?

Now I must think of some way to recover and go back on topic. At least plausibly so.