Тег: Manipulations

What is this “private slavery” in libertarianism being referred to in the post from July 30?

The anarcho-capitalist camp—Rothbard, for example, analyzed this issue in detail in “The Ethics of Liberty,” explaining the impossibility of defending a slave contract within libertarian theory.

анонимный вопрос

In the final paragraph of the post from July 30, I do indeed mention voluntary private slavery in passing, but in an extremely narrow sense. If there exists a methodology that allows for complete control over a person’s actions through some mysterious subconscious manipulations, yet all these manipulations are non-violent, then the person is de facto enslaved and, from the perspective of an external observer, completely voluntarily performs any actions required by the manipulator.

Such things are the subject of horror stories about the coming dominance of big data, which will compile a full profile of every person and allow for ideal influence over them, so that under this influence, they might go to the polling station to vote for you, go to the store to buy your product, or dance on the Maidan.

In my view, such a dystopia is the flip side of the utopia of a bright communist future, where abundance is ensured by a planned economy managed by benevolent supercomputers—and it has just as much chance of being realized on a global scale. However, I cannot rule out isolated cases of gaining complete control over human motivations through non-violent manipulations, which is why I mentioned them in my analysis of the concept of free will.

This has nothing to do with Rothbard’s argumentation regarding the impossibility of libertarians defending a slave contract, given the absence of a contract.

It looks as ridiculous as a horse harnessed to a sports car

A question about stock exchanges

Investments and exchanges are the foundation of the entire market economy today. Essentially, in the absence of a regulator in the form of the state, traders would be able to gain virtually unlimited power: they could inflate prices or, conversely, crash them to zero, destroy some companies and promote others. So the question is: how will exchanges work in ancap? What alternative will be offered to investors instead of the stock exchange in the event of its liquidation? How can the dominance of traders over the market be prevented?

Muller

The order book is, in fact, the quintessence of the free market. Pure supply and demand, stripped of any rhetorical fluff. It is not for nothing that the foundations of Austrian economic theory were laid by a stock market observer. So, of course, in a free market economy, the role of exchanges will only strengthen.

What are the main dangers facing an investor on the exchange?

First, these are possible exchange manipulations.

In the world of stock exchanges, blatant manipulations have become a great rarity because they care about their reputation. If we encounter any restrictions from trading platforms, these are usually requirements of external regulators—for example, regarding the suspension of trading in a situation of market panic. I do not know which exchanges companies will prefer for listing their shares—those that provide for an automatic stop of trading during price spikes, or those that guarantee continuity. Let the consumer choose.

In the world of cryptocurrency exchanges, attempts to protect against exchange manipulations led to the emergence of demand for decentralized platforms, where you cannot fake volumes. I would not be surprised if over time stock exchanges are also pushed aside when crypto-tokens begin to take the place of company shares.

Secondly, possible insider manipulations.

This is, in fact, a problem not of the exchanges, but of the companies that are traded on them. Even now, private companies are taking measures to prevent such machinations—through non-disclosure agreements for insider information that provide for serious payments for their violation, as well as through moratoriums on trading company shares for its employees in periods shortly before the publication of regular reports. The absence of such measures will simply be taken into account in the share price of specific companies as an additional risk factor.

Thirdly, market maker manipulations—traders who have access to very large capitals. This is the factor you are writing about.

Here, one can only say one thing: if you want to be indifferent to such manipulations—simply do not take loans secured by shares. Then you will not have to dump shares due to a margin call if someone temporarily crashes the price. No market maker is capable of completely zeroing out the shares of a prosperous company: no matter what panic rumors he spreads, no matter what volumes of shares he dumps onto the market, if you simply forget about your stake for a month or two, you will lose nothing; the price will return over time, it’s just that some will sell securities during this time and some will buy. It’s not even a fact that the trader who started all this will necessarily profit. He is not the only one—a large movement will attract others, and they will play it their own way.

So, there is no question of trader dominance in a developed market. This is simply their habitat. The more of them there are, the better the life of the companies traded in this market, and the harder it is for traders to manipulate the price of assets.

In general, exchanges are simply a tool through which it is convenient for a seller and a buyer to find each other. This is not some self-sufficient entity. If the tool works correctly, it will not cause damage to real companies in itself.

Consultations were used in the response from Srpski, as a gesture of gratitude he asked to reference his channel “Serbian Divergent”.