Re;CapitalMarkets

Daniel Davies d_squared_2002 at yahoo.co.uk
Wed Aug 30 09:22:53 PDT 2000


Max wrote:


>>Isn't the interest payment surplus value?<<

I don't think that there is an interest payment in this one? The claims I discuss are claims on a stream of performance-related pay from the central organising committee; they're not directly related to the co-operatives carrying out the projects.


>>Who's to say that investment in proportion to past
success is the best allocation of capital? If it isn't, mustn't you have a capital market?<<

Two points:

1) As I've argued with Justin in the past, the "best" allocation of capital isn't necessary -- investment of past success is in fact the way in which most investment in the whole world is financed, so it must be a viable economic model.

2) Not a capital *market* -- a capital allocation scheme, yes, but it doesn't have to be a market. If you have two thousand guys deciding which start-up projects to back, I'm not sure it creates a huge amount of value to call them "venture capitalists" and to make the whole system dependent on eventual IPO.

dd

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