🎓 Dr. Freemo 🇳🇱 @freemo@social.cleverlibre.org

@LouisIngenthron

We are talking as i write this by the way.

I asked about the whole"A sophisticated investor just needs a letter" thing you said.. and he said, its more complicated than that.

It is not your job as an investor to prove they are sophisticated, but if you know they arent it would work against you.

So if you know your aunt well enough and know she never worked in the industry, never invested, and didnt even graduate high school... then even if she lies in a letter and says she is an expert, because you know she isnt you can and probably will be found guilty should that ever go to court.

However if there is plasuable deniablity and the court would find that you had every reason to beleive they were a sophisticated investor and they just lied to you but you had no idea they were lying... then yea, you probably would be fine.

As he put it, you basically just need to show that any "reasonable person" in your situation would conclude the person was a sophisticated investor.

@admitsWrongIfProven

@LouisIngenthron

It is complicated, and im not a lawyer... so i cant go into the level of detail you'd like...

But the short of it... it depends. If your friend is just a friend with no business expiernce or money, then no, that would be illegal.

There would be three ways:

1) They have to qualify as credited (basically a rich experienced investor)

2) They would have to qualify as exempt from accreditation requirement by being what is legally defined as a "sophisticated investor"... more or less this means they have to be an expert enough in the field to be able to show they fully understood the risks and rewards. Basically if your aunt who is super sweet but has never worked int he industry wants to invest she wont qualify.

3) the investment needs to be registered... which basically means all the restrictions of a public company are enforced on it.. this is completely not a possiblity for any startup as the infrastructure to qualify the investment as registered is very very expensive (its about as expensive as just going public since you have to make all the same motions).

@admitsWrongIfProven

@LouisIngenthron

> Sure, it “still generates wealth”. Burning cash for heat generates wealth if you’re cold, but that doesn’t mean it’s a good thing.

This analogy suggests you still dont understand the distinction between money, value, and wealth.

Short of literally burning money, companies dont burn money when they tank, even if they spend irresponsibly they arent burning money... All they are doing is moving the money out of their company and into other companies or peoples pockets.. the total wealth when a company tanks is the same, its just distributed different.

> Why would you look only at wealth in a single point of time?

We arent, we are explicitly talking about how wealth that was generated (thing with utility, the cars) then a company going bankrupt later does not destroy that wealth **at a later point in time**... the company crashing doesnt destroy wealth because the amount of things it put into the world that had utility (which was earlier in the timeline, so we are looking at time here) still exists, so wealth was generated and not destroyed.

> A company that lasts 100 years generates far more wealth than a company that closes after one

This is certainly true.. and if your argument was "the company that made short term wealth and then crash did not reach its full potential at making wealth, and if it had been managed with concern for its long term success then it could have generated **more** wealth"... this would be a correct statement yes, there was a lost potential for generating wealth that wasnt realized... that is **not** the same as saying that the company didnt over the court of its life have a net positive wealth generation, it did.

> By seeking short-term profits over long, the investors are robbing the company of future wealth to pay themselves dividends now.

Its not always for dividends, and investors do not get to dictate day to day operations.. The only thing an investor can do is vote for board members and with some serious restrictions sometimes impeach them.. even the board cant control day to day operatiosn, they in turn need to hire a CEO.

So to think an investor in a company even can exhivit such fine level of control is a bit sketchy...

But all that aside, sure, they are generating wealth, which is good for the world, but they are generating perhaps less than they potentially could... ok.. so its less good than it could be, but still good... im ok with that analysis i suppose.

> And they enshittify the products and services as a result of their wealth extraction techniques. We see it happening over and over.

Sure, i am willing to say they may build a shittier product to maxamize profits.. thats partly the consumers fault for buying a product that is a shitty deal though.. but yea, I mean i dont care enough to disagree with this per se... does change the fact that they generated wealth which was good for society and if you eliminated them all you wont achieve some paradise, youll just destroy what little imperfect wealth generation we have and create massive poverty... so while maybe they could build better products in theory, in practice they are still adding wealth to the world.

> Investment is a good thing for business. But publicly-traded companies aren’t invested into; They’re bet on like ponies in a race, and the incentives that come from that rob all of us in the long run.

Yea this shows you have absolutely no clue how stocks work then... I just spent 2 years running a company merging with a public company (so I had to run it like a public company ont he stock market)... Yes when you buy stock we as a public company get operating money as a result of that. You probably dont realize it but the company itself is able to 1) take out loans on the value of its stock 2) holds some of its own stock so as the value of stock rises so does the asset holdings of hte company 3) can, and does, and is normal issue new stocks and sells it on the stock market regularly

Literally public companies get cash as a result of their stock price going up, and your gonna sit here pretending like its just a trading card game...I know you mean well but man you assert things like you know when clearly you dont know the basics... when talking to experts on subjects (in this case me as someone who literally just spent 2 years being the EVP of a public company)... Please please please... try to listen to people and recognize the areas you dont have knowledge in (like i did with you when talking about aviation)... it will go a long way for you, I say this as a friend not to be mean.

@admitsWrongIfProven

@LouisIngenthron

Cheese burgers and houses **are** wealth... Based on your wording you are confusing "wealth" (things that have utility and value) and money..

If you have profit alone, then you just are moving money around.. you arent generating wealth (or money)... in order to generate wealth you must increase the overall number of things in society with utility... So yes what i said already was in line with what your saying, you just are using wealth in the way of "collecting wealth" which is not the same as "generating wealth".

> The people who actually create those things should be the wealthy in a just society, not the people who were born to it.

Agreed, like the people who sacraficed decades to create the idea, get funding, investing in the building, getting the money to pay people to do the labour, etc... yes the owners who risk everything and actually create the wealth are the people who should be wealthy.

@admitsWrongIfProven