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Why Accept Bonds/Give Loans?
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Kara Roideater
#41 - 2012-03-23 14:06:42 UTC  |  Edited by: Kara Roideater
Darth Tickles wrote:
You guys are right. We shouldn't use our knowledge and experience to help others avoid pitfalls...not without getting paid anyway.

I've learned a valuable lesson here today.


Helping someone and manipulating them are two different things to me, even if the objective is the same. I try, or I used to when I was more active, to warn people off crap investments, encourage them to approach things in a reasonable way, avoid getting bewitched by the splendour of reputation. I suspect that helped some people but not others. But I'm not going to encourage a fundamental and basic corruption of public discourse in order to save people who have already ignored my attempts to help them.

Fortunately these poor benighted souls have a guardian angel to watch over them. St Darth the protector!
Liberty Eternal
The Scope
Gallente Federation
#42 - 2012-03-23 14:16:24 UTC
Darth Tickles wrote:
You guys are right. We shouldn't use our knowledge and experience to help others avoid pitfalls...not without getting paid anyway.

I've learned a valuable lesson here today.


Although well-intentioned, isn't that something of an elitist view? It's widely understood that if you want to play a game well, you have to learn the game well. Having gone through the MD meat grinder myself and popped out relatively intact on the other side, I have to say that the dangers, curiosities, trials and tribulations are all a rewarding part of the experience.

Note it well - some people do not learn, no matter how much help or information you give to them. And those who are generally well-disposed to learning will often figure it out for themselves anyway. As Kara points out, an open society with all its dangers and misinformation is a necessary one because a controlled information space is only an illusion - and a dangerous one at that.
Darth Tickles
Doomheim
#43 - 2012-03-23 14:38:56 UTC  |  Edited by: Darth Tickles
You're not allowed to use hyperbole back at me. That's not fair.

P

All bullshit aside, I can honestly say I'm pretty satisfied with this thread in general, and the last twenty or so posts especially. I think as a group we've managed to give a pretty fair and accessible representation of the debate here, at least better than any previous attempts I can think of.

While I'm "straight-talking" here, I read your email, though I haven't had a chance to read your attachment. Overall I absolutely agree with you. One of the few core beliefs I have is that given enough opportunity, only an individual can reason for themselves what is best for them. I also believe that if you make a good enough argument, most people will come around no matter how much it inconveniences them philosophically. What I'm trying to do with my professional career is get to a place where I don't even deal with answers, but only in providing people with a "toolbox" to frame the questions for themselves and find their own answers.

However, I do think in the realm of political action whatever works is justified by the requisite expediency. I have huge issues with liberal thought and its "rational man", and I think giving people the illusion that their decisions and circumstances are optimal is an incredibly damaging over-reaction to the totalitarian systems from which it sprang (though still better than those systems by far). I have no issue with simplifying discourse to shape political action, when action must be taken, because we are not perfectly calculating optimizing machines, very far from it. However, I do think it is a problem with our public discourse that most of the issues are given a false sense of urgency and are misplaced as legislative issues in the first place.

I steadfastly believe that the only way forward is to empower individuals with the ability to reason for themselves and the tools to identify issues that matter to them, articulate these issues, and coordinate with others to solve them as best they can. I believe that as people become more empowered to act collectively effectively and spontaneously, the less need we have for a legislative body where disinformation and rhetoric is an inevitable result. However, there will always be circumstances where reason is insufficient because of complexity and expediency, and political action requires requires authority of some sort. And inherent in that authority is a functional simplification of the issues over which that authority needs to dictate.

Bringing that allllll back around to what we have here. I don't believe that people read anything longer than two paragraphs, though they subconsciously find the initial message more authoritative if many words follow, and to expect more is unfair to them considering the venue. I think it is your responsibility to consider how your message will be interpreted, not how you want it to be or think it should be, and tailor it accordingly.
flakeys
Doomheim
#44 - 2012-03-23 14:39:12 UTC  |  Edited by: flakeys
Darth Tickles wrote:
You guys are right. We shouldn't use our knowledge and experience to help others avoid pitfalls...not without getting paid anyway.

I've learned a valuable lesson here today.



Hey mister white knight , go to the nearest macdonalds and tell everyone there that they can get fat out of eating fast food.While there blaim the thin people who are also eating there yet don't get fat out of that trash how it is THEIR fault the fat people keep eating junk food and that they should pay for the funerals of those fat people.

Because that is EXACTLY what you're doing now.




No one ever claimed investing is safe , and those who do are idiots in my book.IT's a gamble , allways was and allways is and people should do it for ***** and giggles just as why people pvp.When done with a bit of thinking and a good amount of luck one might end up having more isk just like with pvp one might be last man standing on the field and able to loot his victim.

We are all born ignorant, but one must work hard to remain stupid.
Darth Tickles
Doomheim
#45 - 2012-03-23 14:49:50 UTC
flakeys wrote:
Hey mister white knight , go to the nearest macdonalds and tell everyone there that they can get fat out of eating fast food.While there blaim the thin people who are also eating there yet don't get fat out of that trash how it is THEIR fault the fat people keep eating junk food and that they should pay for the funerals of those fat people.

Because that is EXACTLY what you're doing now.


A childish oversimplification.

Civilization is based on shared experience and the refinement of response patterns into a transmitted "culture".

The debate is over how we go about transmitting and receiving information from each other over shared experience, not whether we do or not. The idea of a perfectly-calculating and ultimately sovereign individual is enlightenment-era, reactionary farce. To paint all argumentative discourse as coercive totalitarianism is ridiculous, especially considering that's what you're doing right now.

In simple terms, there's nothing wrong with trying to convince people of things. We all do it and we all have it done to us every day. It's the essential feature of the civilized human experience.
Hexxx
Sebiestor Tribe
Minmatar Republic
#46 - 2012-03-23 15:07:27 UTC
Darth Tickles wrote:
You guys are right. We shouldn't use our knowledge and experience to help others avoid pitfalls...not without getting paid anyway.

I've learned a valuable lesson here today.


So...I take it you don't like Objectivism?
Jake Andarius
Andarius Trading Corp.
#47 - 2012-03-23 15:12:33 UTC  |  Edited by: Jake Andarius
@ Darth: It is really interesting that you approach discourse in the way that you do. From what I can tell you are saying that, rather than being completely honest and gregarious, there is a significant advantage in using rhetoric and aggression to achieve the desired effect (i.e. dissuading someone from engaging in risky, uncollateralized investments). Lord Adante, one of my best RL friends, and I have actually had an ongoing dispute over the years about these two antithetical argumentation techniques. My basic contention is that, when you are honest and gregarious, people are far more willing to engage in discussions with you and therefore gain information that they might not have previously had. On the other hand, if you use a lot of rhetoric and aggression, people are more likely to strongly disagree with your points, and not change their minds, because they are immediately set on the defensive. Those of course are my current thoughts on the matter. What do you think?

Andarius Trading Corp. | MD Borrowers and Trustees
Darth Tickles
Doomheim
#48 - 2012-03-23 15:22:25 UTC
Jake Andarius wrote:
@ Darth: It is really interesting that you approach discourse in the way that you do. From what I can tell you are saying that, rather than being completely honest and gregarious, there is a significant advantage in using rhetoric and aggression to achieve the desired effect (i.e. dissuading someone from engaging in risky, uncollateralized investments). Lord Adante, one of my best RL friends, and I have actually had an ongoing dispute over the years about these two antithetical argumentation techniques. My basic contention is that, when you are honest and gregarious, people are far more willing to engage in discussions with you and therefore gain information that they might not have previously had. On the other hand, if you use a lot of rhetoric and aggression, people are more likely to strongly disagree with your points, and not change their minds, because they are immediately set on the defensive. Those of course are my current thoughts on the matter. What do you think?


You've absolutely hit the crux of the discussion, yes.

I agree with you that honesty and deliberateness are overall and in general the best way to go. That said, the world is constantly in motion, and we constantly make decisions with incomplete information because we've decided that, in this particular case, further investigation and experimentation will not be worth the time. If you're sitting around expounding on lengthy philosophical arguments about the benefits of cooperation while the guy the next cave over just said "**** it" and started sharpening some sticks, you're probably going to end up with a spear in your face, regardless of how honest and deliberate you were.
Hexxx
Sebiestor Tribe
Minmatar Republic
#49 - 2012-03-23 15:31:05 UTC
Darth Tickles wrote:
Jake Andarius wrote:
@ Darth: It is really interesting that you approach discourse in the way that you do. From what I can tell you are saying that, rather than being completely honest and gregarious, there is a significant advantage in using rhetoric and aggression to achieve the desired effect (i.e. dissuading someone from engaging in risky, uncollateralized investments). Lord Adante, one of my best RL friends, and I have actually had an ongoing dispute over the years about these two antithetical argumentation techniques. My basic contention is that, when you are honest and gregarious, people are far more willing to engage in discussions with you and therefore gain information that they might not have previously had. On the other hand, if you use a lot of rhetoric and aggression, people are more likely to strongly disagree with your points, and not change their minds, because they are immediately set on the defensive. Those of course are my current thoughts on the matter. What do you think?


You've absolutely hit the crux of the discussion, yes.

I agree with you that honesty and deliberateness are overall and in general the best way to go. That said, the world is constantly in motion, and we constantly make decisions with incomplete information because we've decided that, in this particular case, further investigation and experimentation will not be worth the time. If you're sitting around expounding on lengthy philosophical arguments about the benefits of cooperation while the guy the next cave over just said "**** it" and started sharpening some sticks, you're probably going to end up with a spear in your face, regardless of how honest and deliberate you were.


I know it's a tangent, but I do like talking about this stuff so my apologies for any thread derailment...

I actually really like the summary you wrote here; however, the problem I've always had with the idea of "...further investigation and experimentation will not be worth the time..." is that it's an easy way out of never challenging the status quo, common assumptions, etc. I've always equated it with intellectual laziness (I admit, that's harsh).

Yes, we've a finite amount of time and energy to think about things but how can someone expect to continue to grow if they've drawn intellectual "lines in the sand" all around themselves. Pretty soon those lines form a box not unlike that of an intellectual prison.

p.s. The usual caveats of "this is my personal opinion" apply.
Nick BlueStar
The Scope
Gallente Federation
#50 - 2012-03-23 15:46:00 UTC
What a good read.

Going back to what Florestan and Kara were talking about earlier, how can you make the proper risk assessment? There are no third party ratings agencies nor government watchdogs like in real life. No credit history like real life, except for what a few have tried to do, organizing all the loans currently active on MD. The corporations are "one man corps." So the liability ends with the person. And as others on MD point out, revealing too much about what you're actually doing can/will kill your market, so it's better to be vague.


In real life you have the credit agencies, the government watchdogs, the checks and balances to make a firm risk assesstment about who to invest in, even with personal loans among private people.



If investing on Eve is reduced to just individual X giving a loan to individual Y as Florestan points out, than the only risk assessment you can do is
Do you have a history with this person? Do you trust this person? Is it worth the risk?



Adding things like audits just add, or attempt to add, some legitamacy to an otherwise completely risky adventure. Especially if you have no prior history with that character or corp that you wish to invest in.


That being said, would it be more accurate to describe MD as a private club (like the Metropolitan Club irl) where those with a known and trusted history do deals with other known and trusted people. The nature of the game and the market system demands that kind of
trust among investor/investee's.
Darth Tickles
Doomheim
#51 - 2012-03-23 15:47:47 UTC
Hexxx wrote:
I know it's a tangent, but I do like talking about this stuff so my apologies for any thread derailment...

I actually really like the summary you wrote here; however, the problem I've always had with the idea of "...further investigation and experimentation will not be worth the time..." is that it's an easy way out of never challenging the status quo, common assumptions, etc. I've always equated it with intellectual laziness (I admit, that's harsh).

Yes, we've a finite amount of time and energy to think about things but how can someone expect to continue to grow if they've drawn intellectual "lines in the sand" all around themselves. Pretty soon those lines form a box not unlike that of an intellectual prison.

p.s. The usual caveats of "this is my personal opinion" apply.


No, you're absolutely right.

Basically culture is a set of practices (reactionary and interactive patterns) that "work", they work and we don't know any better, so we don't challenge them. In fact, challenging culture is usually taboo because when you're scraping by as is, experimentation can often be deadly. However, if no Hex's ever stood up to accepted wisdom and said "hey guys, maybe we shouldn't **** where we drink", we would all still be drinking shitwater.

The problem is this sort of perverse individualism we've inherited from the reactionary enlightenment tells us that everything we think IS the end result of perfect theorizing and experimentation; that whatever we think the answer is is right because we thought of it. It's actually an overconfidence that leads to action but not innovation, very similar to its progenitor ideology where whatever we do is right because god (or spirits) said so.

I think we should challenge everything as much as we can; I think the ability to challenge is the greatest benefit of the surplus that our existing culture produces for us, which might be paradoxical to some. However, we must realize the severe limitations of our own ability to push the boundaries of what we know, and that much of what we do know is the result of thousands of years of practical refinement and cultural transmission, not some supercomputer that resides in us individually and with which we calculate out new world's of action and interaction every single day.
Nick BlueStar
The Scope
Gallente Federation
#52 - 2012-03-23 15:56:43 UTC  |  Edited by: Nick BlueStar
Darth Tickles wrote:
Jake Andarius wrote:


You've absolutely hit the crux of the discussion, yes.

I agree with you that honesty and deliberateness are overall and in general the best way to go. That said, the world is constantly in motion, and we constantly make decisions with incomplete information because we've decided that, in this particular case, further investigation and experimentation will not be worth the time. If you're sitting around expounding on lengthy philosophical arguments about the benefits of cooperation while the guy the next cave over just said "**** it" and started sharpening some sticks, you're probably going to end up with a spear in your face, regardless of how honest and deliberate you were.


But many people don't take into account that the world is constantly in motion (read: out of therir control) and make decisions based on incomplete information, but act like they just made the absolute correct decision. They then act surprised, and even angry, when their plan blows up in their face, not even realizing the situation was out of their control to begin with.

EDIT: ah you just posted something like this to Hexx already.
Kara Roideater
#53 - 2012-03-23 17:00:40 UTC
Nick BlueStar wrote:
What a good read.

Going back to what Florestan and Kara were talking about earlier, how can you make the proper risk assessment? There are no third party ratings agencies nor government watchdogs like in real life. No credit history like real life, except for what a few have tried to do, organizing all the loans currently active on MD. The corporations are "one man corps." So the liability ends with the person. And as others on MD point out, revealing too much about what you're actually doing can/will kill your market, so it's better to be vague.


Some of these are genuine difficulties with eve, others are not. Credit history, for instance, is fairly easily established with the use of eve search and asking simple questions of the person you are interested in investing in.

Quote:

If investing on Eve is reduced to just individual X giving a loan to individual Y as Florestan points out, than the only risk assessment you can do is
Do you have a history with this person? Do you trust this person? Is it worth the risk?


Not really. Part of the risk assessment is getting to know the person. X asks for isk. Y has isk and is in the market to invest it. Y finds out as much as he can about X and comes to a conclusion about how much he trusts X (NOT 'whether he trusts X', if you think you can know in an either/or way you are doomed) and whether the potential rewards stack up against the risks.

Quote:

Adding things like audits just add, or attempt to add, some legitamacy to an otherwise completely risky adventure. Especially if you have no prior history with that character or corp that you wish to invest in.


There is a long standing debate on MD about audits. It does appear to be true that some people take them as a sign of legitimacy. But this is a very poor conclusion to arrive at about them and this idiocy by no means undermines their real value for those who have a decent sense of what they are for and what they can do. For someone carrying out a risk assessment they are very valuable tools that can help you get to know the person being audited more thoroughly. If you want to know whether their claim that they have been trading 8 hours a day for months is true, an audit can tell you that (if you trust the auditor). If you want to know if they really have 10bil in the bank and earn 2bil a week, an audit can tell you that too.

Quote:

That being said, would it be more accurate to describe MD as a private club (like the Metropolitan Club irl) where those with a known and trusted history do deals with other known and trusted people. The nature of the game and the market system demands that kind of trust among investor/investee's.


There is a significant element of that but most people on MD who are trusted to some degree have that trust because they started out as an unknown quantity offering a loan or bond. Some of the people here came to MD already established but most did not. So no, it's not really a closed club. On the other hand it does have some clubby aspects. Some of these are good things, like the social aspects that allow you to get to know people over a period of years, others are not so good. In particular, MD used to be notorious for its cliqueiness, in that a self-slecting group of 'MD Elites' would sit in judgement over investments and have a degree of influence quite disproportionate to their individual merits and talents. There is a lot less of that now, though, since those same 'elites' were responsible for most of the biggest financial disasters in MD history (EBANK was the death-knell and T4U the final nail in the coffin).
Kara Roideater
#54 - 2012-03-23 17:02:59 UTC
Cont.

When I talk about carrying out a 'risk assessment' I mean taking the following into account:

Quote:

1. Get as much basic information as possible to build a risk profile. This in no way provides solid protection as people can certainly act against expectations but it does provide a guide as to when you might expect someone not to bother with scamming. The basic info I always want includes a) current outstanding unsecured debt; b) previous highest unsecured debt; c) earning history and potential, including current NAV; d) degree of activity. With this data you can see that if, for example, someone has held 20bil unsecured for 6 months, cleared that debt and then launched a new bond for 10bil then they are unlikely to be following a masterplan that will involve scamming that 10bil. It is important, however, to get a commitment, where possible, that additional funds won't be raised beyond a certain level or the 10bil could rapidly become part of a 100bil debt that may fit better into a rational masterplan.

Earning history and potential is also useful but by no means definitive. Someone who can earn 10bil a week and has actively engaged with the MD community for months is unlikely to be following a masterplan that culminates in scamming 10bil. Of course they may do so for the laughs but that is a different issue (see below). Degree of activity is worth bearing in mind as it may cast a risk profile based on the previous data into doubt. Whilst someone might not build a masterplan to scam 10bil after already not taking the opportunity to scam 20bil be aware that priorities may change over time. There may also be a desire not to screw certain old investors but to suck in new ones (see, for instance BB's decision to refinance a bunch of old debts immediately prior to scamming).

All this data can initially be asked for from the person you are thinking about investing in but you then have to trust them that the data they give you is true. Whenever possible get a third party that you trust to confirm this information via an audit or fact check. This in no way makes the data absolutely certain but improves the chances of not being misled.

2. Be very wary about investing in people that appear to be slightly unstable, erratic or eccentric, no matter how much you like them or respect them. Unstable, flighty and changeable personality types may be lovely people (or *******s) but the additional uncertainty involved will always make an investment more of a gamble.

NEVER invest in people that are contemptuous towards their investors/potential investors or who take pleasure in the suffering, inconvenience or pain of others. If someone values putting other people in positions of distress they may well end up deciding that distressed investors are worth more than ongoing business relationships.

3. Make sure you get a decent return for your risk. Acknowledge your own fallibility and ask yourself how often you would expect to be wrong. If you think something like BMBE looks like a pretty good bet, ask yourself whether you would be surprised if analogously good bets failed defaulted or scammed once in a year, two years, three years, etc … So, if it wouldn't surprise you if you took three years off eve and came back to find that at least one person you trust as much as BMBE or Grendell or Chribba or Darkness had scammed then it would probably be a good idea to only invest in such people if you can get an interest rate according to which one successful investment would at least balance out a failure (so roughly 3%). Obviously this is a non-rigorous rule of thumb.

4. Never be afraid to pull an investment if new information or behaviour makes you nervous.

These have served me pretty well as guidelines for investing but it's obviously not an exact science. As a final note, all this applies to unsecured debt. But in the case of secured loans remember that if you are not holding the collateral yourself it is never really secured although a belt and braces approach can provide some safeguards.
Vaerah Vahrokha
Vahrokh Consulting
#55 - 2012-03-23 17:12:06 UTC
Just dumping this here with the hope somebody will read it enough times to make it sink. I know it will not make any sense at all for most X as it's my own created model and philosophy.

We are not just insulated monads. We are more alike neurons in a collective brain (= not a physical entity but a collective result) whose accrued data is the past and whose projects is the future.

Relations between singletons and multiplets follow a sort of evolutive, self optimizing (over time), self adapting, scalable fractally autosimilar process.

We learned to call few of those relations "markets" and even put them into graphs. These are mass sociological phenomenons.

All what we see in MD is just a tiny, minuscule facet of that.

Asymmetry of information due to lack of data is compounded by trusting "last resort trust units", the Chribbas of our game (same for outside).
When such units are not available, the next available trust unit is picked (i.e. MD "famous names") and so on in an escalating process balanced between greed (to get a deal done) and fear (of losing all) => the foundations of a market within everybody.

When there's no data available enough that nobody may assume trust unit status then people go wild with the surrogates, i.e. "does the guy talk professionally", "is his stuff looking legit" and so on.

That's neither good or bad, it's how self optimizing structures work.

The collective of failed vs suceeded "lack of data" operations will be collectively digested as "how much statistically is worth risking X for Y" which produces a number different than the pure math corresponding statistical evaluation.

The delta is the emotional part attached to a market, that is the outside "rational market" portion of "price action". That's subject to principles of self amplifying feedback (reflexivity and stuff).


Now, both parties will try using asymmetry of information to gain a profit (self optimizing nature of the singletons, not just of the multiplets), regardless whether one of them is cheating or not.

I don't really see "moral" being implied in financial relations unless somebody actively or by culture chooses to be affected by outside factors (morals, religion, principles being some of them).

This also means that most of the arguments brought here have a full sense only from the singletons' point of view, the overall grand "brain" self optimizing selection nature is overlooked because no singleton wants to think he's the one selected for extinction or just to be bested by another more efficient one.

Trying to instill warnings or wisdom in singletons selected to be bested is another feature also seen in nature: preserving diversity against external changes that would put a totally one sided and biased process ("brain") into jeopardy.

Therefore Darth is performing a "charitable action".
Others are more self centered but are still performing within their singleton role within the local MD "brain" / community.

And what am I doing? Boh, I don't know. Just trying a cogito meta-ergo sum from a singleton that should not know he's a droplet in the ocean(?)

EvE Online portal | EvE markets tutorials
Hexxx
Sebiestor Tribe
Minmatar Republic
#56 - 2012-03-23 20:45:53 UTC
Vaerah Vahrokha wrote:


Words.



Totally agree VV. I think you're tapping into something between the collective unconscience and the inherent alturistic obligations some individuals maintain.

Also, it's ironic that I've learned more about Darth in this thread then anything else - his actions make much more sense to me and I understand his bias to his paticular position and his use of rhetoric.

I don't agree with him, but I think I understand him. The latter is actually more important to me personally.
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