Rambling

One thing that I have observed is that there is always an allergy towards having stored value sitting somewhere that seemingly isn't doing anything other than existing. So we see things like businesses always balancing their revenue and expenditure in such a way that at no point in time do they actually have any cash sitting around, and the so-called ``hustle culture'' that has been developed over the past decade through gig-work platforms and retail-investor platforms where again, no money is allowed to exist in any form other than movement.

There is nothing inherently wrong with having money flowing around---after all, it is the flow of money that undergirds the notion of trade in the first place, regardless of the system in which the trade/businesses are run. In fact, it is often lauded when someone manages to run his/her business/life in such a way that they have practically exploited every single currency unit to their name, with no currency unit allowed to sit around just existing.

That's fine when things are smooth. Business be booming, and everyone's an expert when the market is bullish or something.

From a systems perspective though, that is... a terrible idea. Running everything this close to the edge of insolvency is playing a very risky game of balancing one's absolute certainty against the chaotic nature of emergent systems. There is always an unfounded optimism that self-satisfies the assumption of absolute certainty. And given the ``growth only'' mindset in which the economies of the world are run (it's a historical thing), it only reinforces that unfounded optimism that in the long run, things will be great!

Except in the long run, we are all dead. Or rather, we don't know if the future is truly unbounded, or if it is bounded by an unfathomably large (but still finite!) number, or if the path to get there is always ``in the black'' without any catastrophic losses that we must get through.

And it is those catastrophic losses that I want to talk about. Let's take a little step back. ``Catastrophic losses'' cannot be defended against adequately for the very same reason why we call them ``catastrophic''----these are large negative values in the objective function that are often at a scale where individual participants in the market/economy have little to no power in influencing. Hedging against these are nearly impossible, and most won't try. The best that they will do is to exit under the legal concept of bankruptcy, or the more prosaic idea of ``winding up the business''.

But there is a spectrum of losses that range from nothing to catastrophic, and it is this spectrum of losses that I think all that ``hustle culture'' is nullifying. Weathering a loss requires having some kind of slack, or war chest, or emergency reserves that one can draw upon while the usual capital flows are disrupted. It is not a permanent solution; it is more of a capital-time trade-off, where these reserves are used to buy enough time for the participant to figure out how to route around the damaged capital flow.

Naturally, the more reserves available, the longer the duration that can be bought, but at the flip side, the more reserves available, the less capital there is to be used in motion to generate revenue to balance off the expenditure.

This dilemma is where the notion of risk appetite comes into play.

Thanks to the way corporation laws work, it is possible for non-proprietorship corporations to have a much larger risk appetite, i.e. have less reserves in general. This is due to the limited nature of the liabilities---anything that the corporation owes comes from its own accounts, and not from the people that make it up.

And if the corporations get large enough, they can be deemed as ``systematically important'' and thus have government interference as a back stop.

Because of these rules, it incentivises corporations to always go balls deep in whatever they do.

But therein lies the problem: once this line of thought is started, it self-perpetuates, creating a perverse cycle where the corporations pursue capital over all else. Which is a sad thing for those who are not the corporations (i.e. the people). People are dehumanised---the nature of ``the human nature'' is reduced into semi-self-sustaining automata whose sole purpose of existence is to contribute back into the machine that is the corporation.

Life's experiences, the meaning of life itself, and all other deeply personal experiential moments are all subsumed into the feeding of the massive capital machines.

Some are so depersonalised that they end up acting sub-human, losing their empathy, and acting no different from the data-driven Algorithm when confronting other humans. This is particularly sad when one realises that it is the middle managers (those who are really just other workers with no real benefit from the corporation's success the way shareholders do) that are the most likely to demonstrate such inhumanity.

I sometimes wonder how these people sleep at night. Is their conscience clear from having pwned another person? Or are they unfeeling machines that are covered with the veneer of meat?