SATs are the least unfair metric we have for university admissions. And eliminating them will almost inevitably make the system less fair. With that said, I'm not sure righteous (if justified) anger is going to fix this. There's a good chance this could be challenged in court, or by certain employers.
I work in Manhattan and commute to my office every day by subway. The story exaggerates a bit. In general it is and feels pretty safe during the day and during normal commuting hours. And banks tend to be VERY risk averse when it comes to safety and security.
However, the city just doesn't feel as safe as it did a few years ago. Part of this is that there are fewer people out and about than there used to be (because of Covid). But the trend predates the pandemic and I know a number of women, colleagues and otherwise, who have been followed or don't feel safe walking around alone at night anymore. There is definitely a problem, though I'm hopeful the new mayor will improve things.
You're right. That's a slightly misleading way to put it, and I have revised my original post. My point was that the "default" method of taxation is the same as ordinary income. Long term capital gains and qualified dividends are legally an exception to that rule. Though I don't think it diminishes my broader point.
Capital gains default to being taxed at the same rate as income in this country (as they should be). There are exceptions for certain long term capital gains, and for qualified dividends.
The rationale for this is that corporate profits are already taxed. The effective tax rate is about 25% for US corporations. For income from corporate profits to be taxed at the same rate as normal income, it should be taxed at a lesser rate once it's been distributed via dividends or buybacks (which is how the system is set up).
Changing the system would have several negative effects. It would encourage companies to take on leverage. Interest expenses are deductible for the purposes of corporate taxes. While interest earnings are and have always been taxed as ordinary income. So companies would likely shift their balance sheets to compensate. It would also make short term speculative trading more attractive for US citizens (and lord knows we have enough of that). And lead to greater foreign ownership of US equities, which is not necessarily desirable.
There are certainly fairly indefensible aspects of the US tax code. This just isn't one of them.
There's also an interesting argument that it's less distortionary to tax wage income than investment income. Because wages (and especially the variation thereof) are substantially driven by unearned human capital endowments.
You never know. But this would make building or joining early stage companies in the US dramatically less attractive. Especially for people who have the option of living abroad. I think that would be incredibly bad.
The problem (other than double taxation)is that people whose wealth is predominantly held in a diversified portfolio will be able to avoid this sort of tax much more easily than people who have more concentrated holdings.
Someone who sells a $2 million business is rich, but they aren't that rich. The rules for houses and incentive equity compensation are complex. But this would generally be bad for people who get equity compensation in companies whose value is very volatile (read early stage startup workers). This is very problematic for Silicon Valley's current economic model.
Honestly I don't know. A warehouse associate at Amazon makes ~25% more than a stocker at Walmart does (though Amazon is probably a somewhat harder job). To me, knowing very little about the specifics of labor organizing, Walmart seems like a more logical target. Though that's been very unsuccessful historically. Maybe there's someone experienced in the field on here who could explain how they do target selection?
The UAW failed to unionize Volkswagen's Chattanooga plant despite neutrality on the part of the company. Unionization drives in the South routinely fail by 2:1 margins. As happened here. Implicitly blaming "dirty tricks" for the failure of unionization in the South is not intellectually honest.
These employers almost invariably pay more than the median wage in their region. $15/hour with benefits is pretty good money in Bessemer. It's fundamentally very difficult to organize workers if they feel they're being treated fairly under the existing regime.
As far as I know Ed Thorp also made a lot of money after B-S was published. So it doesn't necessarily follow that B-S made the market more efficient. Also, doesn't his discovering B-S before it's publication and using it to make money support what I'm saying?
I don't think this is right at all. I would be surprised if Alfred Winslow Jones or Warren Buffet (who were some of the earliest "hedge fund" managers) were significantly influenced by Bachelier's ideas. Buffet is famously neither especially quantitative in his investment style nor a believer in EMH.
Financial "technology" pretty seldom actually originates in academia. It's more common that academics formally describe or justify something that market practitioners are already doing. The piece briefly mentions Bachelier doing this. There's good evidence that option prices were (relatively) efficient several decades before Black-Scholes was discovered. And Jones arguably came up with the notion of "beta" before CAPM was a thing. The only real exception I can think of is factor investing.
This might seem kind of petty. But the notion that academia drives (or should drive) finance is not a benign myth. The LTCM crisis and the 2008 GFC were arguably caused by the uncritical application of ideas developed in the academy. I expect more.
Honestly this is a terrible look for Fintech. There's no conspiracy here. The legacy brokers who are way more tied to "Wall Street" have handled this a lot a better. These problems are being caused by incompetence at Robinhood. Someone needs to be held accountable.
That's actually pretty much what happened. Ryan Cohen was able to do what he did (buy a lot of stock and get a board seat) because the stock price was low. But that arguably saved the company. Change of control isn't inherently bad. And it often leads to incompetent CEOs being fired.
The firm has an opportunity raise a ton of capital very cheaply that it can use to fund productive investments. That's good for the firm, and its good for the people who work there.
I have no sympathy for the short sellers. They're paid a lot of money to understand the game they're playing. And if they lose, that's too f*cking bad. But the same goes for WSB. If they're gonna be pissed off that the company makes what is unequivocally the right decision for the firm, then they're just as hypocritical as the short sellers.
It wouldn't exactly bail them out. It would in effect crystalize massive losses. And, were I asked to advise the GME board, I would tell them it's in the best interest long term of the company at this point (because it is). It would also have the benefit of effectively cashing out all the GME longs at once. Otherwise, there'll be a frenzy on the way out the door, and the most connected/sophisticated people will beat the retail traders.
Also, you can't run a company into the ground by shorting it. A firm's stock price has no inherent effect on its day to day operations. There are plenty of operating companies that are bankrupt. Equally so, GME doesn't benefit from the run up in its stock price at all. The only time the market price actually effects a company is when its time to raise or return capital. So the only way GME will actually benefit from this episode is if it sells stock.
Yes. AMC is reportedly contemplating selling stock, and it's certainly possibly GME could do something similar. Though they'd do it at the best price they can get.
I'm not sure they are. But, if they are wrong, it would likely be because of a handful of things.
*All the below are hypothetical scenarios, I have no specific reason to suspect any of them will or won't happen. This is not financial advice. Trade at your own risk.
1) Hedge funds may have been buying GME alongside WSB. Once the shorts stop out, the funds will know before WSB does. And get out ahead of them. The size of the position suggests this is a possibility.
2) GME management will announce an equity offering. This is arguably the economically/financially correct thing to do. And is also aligned with management's incentives. With more shares in the market, the shorts would no longer be squeezed.
3) GME has become too volatile to easily manage counter-party risk via daily margin posting. This makes options and cash equities much harder to transact. Which is what we saw yday. This could limit the ability of non-professionals to access the market. Killing the squeeze.
4) Robinhood could face solvency (or the perception thereof) issues. This could cause a rush to close out accounts while people still can. Generally, even having to deny you have a liquidity problem is a bad sign.
5) Some truly massive player or a group of them (Citadel and Melvin are only middle size fish) will come in and crush the longs. Gamma works in both directions.
6) The index funds that currently hold the stock will make an exception to their usual rules and sell it because the market is so clearly dislocated. Or alternatively the providers could kick out GME. This would again significantly reduce the squeeze.
7) The regulators will set the stock to liquidation only. The exchanges have the power to do this. And this is the sort of situation that said powers are contemplated for.
So there's quite a bit that could potentially go wrong. And so a good chance that the squeeze participants could lose their investments. Part of the problem is that it isn't clear just how large the short positions really are at this point. While I have zero sympathy for the hedge funds on the other end of this trade, if you live by the sword you die by the sword, the regulators may decide this presents a systemic issue. In which case they're going to shut it down.
I actually can think of no case where a cop clearly shot someone in bad faith and wasn't ultimately charged. It's much more often the case that the cop has some plausible argument that they made a bad decision in good faith. Which makes the cases very hard to prosecute. It's pretty seldom the case that prosecutors corruptly ignore clear cut misconduct.
There are flaws in the justice system. And by no means is it totally fair. But in this sort of situation, where a judge has seen the evidence and issued a warrant, usually there is usually something there. It's very possible this is selective prosecution. But, I'll bet you a good sum of money at even odds that there's probable cause she committed a crime.
If a cop willfully lies on a warrant they are generally civilly liable. I am by no means saying that no one in the criminal justice systems acts unethically. But if a judge signs a warrant for someone's arrest there is almost always good reason to suspect they committed a crime.
This is a really bad idea. I'm more sympathetic to Twitter. Even under the First Amendment there's no right to say things that aren't true. Which is more the issue than incitement. But this goes way too far:
Companies with business before the US and foreign governments should not be making these decisions. The potential for corruption is absolutely huge. Do we really want Tik Tok deciding what the US President can and can't say.
This is going to further erode trust in US institutions. To believe Trump isn't lying about the election you have to think there's a massive conspiracy to keep him out of power. Well...
Banning people from sharing beliefs doesn't make them less popular. Banning racist speech has NOT worked in Europe.
This is disproportionate to what Trump actually did. This is not to downplay the seriousness of a riot inside the Capitol Building. The timing and nature of the act are repugnant and the people who did it deserve to spend some quality time in federal prison. Trump's false rhetoric about the election being stolen undoubtedly (and foreseeably) motivated these people. But I don't think what he said can be fairly read as advocating what happened. There was no threat whatsoever of the government being overthrown. Trump and people like him will ultimately find a way around these actions. And once they do they will cease to be effective. Individual states can probably step in and ban this sort of thing. And I fully expect most Red States to have done so by the end of the year. These tools should be preserved for a true emergency. Which this isn't.
The right solution to the issue of disinformation is changing libel laws. NYT vs Sullivan was probably a mistake. And several states have criminal libel laws that could have plausibly been applied here.