[Pieter de Beer]

This is an invaluable response already, thanks Scot.

I can definitely see how, given the CasP framework of encompassing political influence into the notion of capital, straight forward  market cap would not be reflective of power. And I can also understand that CAPM falls short because it would necessarily need to exclude specific kinds of social relations, and “external influences”.
Finance has always, in my view, been an attempt to quantitatively assess a fundamentally qualitative field of social ecology, and the subjective aspects of this social ecology will not be representable in an accurate, or meaningful quantitative measure without including arbitrary classifications that must limit the scope of the valuation. As a result, the subjective “God-of-the-gaps” is filled in with pseudo-empiricism that either over-inflates firm value, or vastly under-estimates aspects of the social ecology, or both.

I’m passingly familiar with CAPM, and a few other Valuation methodologies, predominantly because I spent some time a few years back ruminating on and searching for various theories of value. I have my own ideas about what may or may not work as a value theory in reality, but am able to admit I don’t know nearly enough about the way the world (dis)functions to be able to put my ideas into a coherent theoretical framework just yet. (The best and closest description I have encountered so far is Ryan Salisbury’s Priority Theory of Value and his proposed system of Transferics which I believe has fallen dormant for a while now, due to a lack of critical feedback )

In my original post I chose not to look past 1921 into the origin of Discounted Present Value, specifically because it gets very complicated, very fast. The Great Depression, the circumstances leading up to it, and its subsequent results within the world of finance, are extremely complex (and become ridiculously convoluted over time), and there is such a vast amount of literature, that it is more than daunting to someone who has not actually studied the field, let alone worked within it.
Hence my objective is to look at where it all started (for the contemporary system anyway) so that I can see how foundational principles evolved into what is used in practice today.

I think once I have a clearer understanding of the origins and evolution up to the point of the Great Depression, I might be ready to do a deep dive into the 90 years since then.

• This reply was modified 3 years, 4 months ago by Pieter de Beer.

[Pieter de Beer]

in 2019, James Glattfelder and Stefano Battison of the University of Zurich published a paper The architecture of power: Patterns of disruption and stability in the global ownership network

In this they show that while the global network of owners and shareholders fluctuates, the core of the network remains largely stable.

To me, this says 2 things.

1.  The differential power of Dominant Capital seems to have a winners network that remains relatively constant. and while some individuals, firms, or conglomerates of interests may rise within the ranks, they are more likely than not to be losers in the long run.
2. The resilience to deep economic shocks indicates that either Dominant Capital is self-sustaining to a large extent (too large to fail… which I doubt), or the systems of support power that it has developed over the last 4 decades are specifically designed to assist in the weathering of these economic storms, which in turn implies that Dominant Capital may be encouraging high risk volatility (massive bubbles) in order to consolidate power during the resulting shock. (this last part is speculation, but as a strategy, it is sound, especially if you have hedged your bets by creating the necessary legislation to support  the top rungs of capital)

 

[Pieter de Beer]

Thanks for the encouragement Blair.

I think I will Flesh this piece out in full depth before I move on to any other subjects within the CasP sphere, I have found it deeply fascinating digging this information up over the last few weeks, and in looking over the sources, there is a lot to do in connecting the dots to show this evolution from feudalism to mercantilism, to proto-capitalism.

I’m not happy, for instance with the limited view of focusing only on England and the USA, and am sure that if I broaden the horizons, there would be far more informative information surrounding the rest of Europe, the Middle-East, the Far East, North Asia, Africa, and south America.

I also don’t think that the level of detail here is even remotely granular enough, and so the “intuitive leaps” needed to jump from event to event might actually be completely incorrect.

[Pieter de Beer]

I might be off base here, but I have thought for a while that the state, ANY state, necessarily treats capital as it’s constituents.

So if we say that liberalism is supposed to be about liberty, consent of the governed and equality before the law, and that  the object of this philosophy is not the populace, but rather the capital which the ideology encapsulates, then liberalism will be about the liberty of capital, the consent of dominant capital, and capital equality before the law.

The same can then be applied to Marxism-Leninism-Stalinism, which is supposed to be about: from each according to his ability, to each according to his needs. and if we view the object of these first principles as the locus of power and the providers of power, then from each according to his ability, means the workers would supply the power, and to each according to his need, would mean the locus of power would be on the receiving end.
The USSR is such a vast convolusion of often conflicting philosophies that i’ve never really managed to get anything more coherent as a first principle out of it.

Maoism offered much of the same, except that where Marx viewed the Urban Worker as the supplier of power, Mao viewed the Rural worker as the supplier. So it makes sense that China remained predominantly agrarian for the entirety of Mao’s reign.

This brings us to North Korea, which originally took much of Maoism as it’s starting philosophy, but makes use of Juche as it’s core indoctrination. Juche being a philosophy of “self-reliance” would necessarily mean isolationism, xenophobia, strict hierarchies, and even stricter adherence by the populace to the strictures of Juche.

While Stalin publicly rejected the Cult of Personality that Leninism inspired (although though i believe this was just PR spin), Mao had no problems with it, and the Kim dynasty actively pursued it. This is worth keeping in mind, because it is one of the Concepts of Power utilized by the North Korean Mode of Power.

Kim Il Sung had explained Juche as:

“Establishing juche means, in a nutshell, being the master of revolution and reconstruction in one’s own country. This means holding fast to an independent position, rejecting dependence on others, using one’s own brains, believing in one’s own strength, displaying the
revolutionary spirit of self-reliance, and thus solving one’s own problems for oneself on one’s own responsibility under all circumstances.”

So if we take Juche as the philosophical first principles, and the object of the principles being the Personality around which the cult is established, then

1. Being the “Master of revolution” would refer to the Kim in charge.
2. Reconstruction would necessarily mean that the reconstruction is done by all, on behalf of the Kim in charge.
3. Holding fast to an independent position would mean isolationism.
4. Rejecting dependence on others would mean xenophobia.
5. Using one’s own brains would refer to the view that the Kim in charge holds moral and intellectual supremacy.
6. Believing in one’s own strength would mean Military independence (and thus the industrial capacity to support such manufacturing)
7. Displaying the Revolutionary spirit of self reliance means openly supporting the propaganda machine doled out by the autocracy.

Juche is, at it’s core, a philosophy of man’s supremacy over the world. It is a statement of Order and Creorder in-and-of itself.
Obviously it is deeply flawed, and as a result of this extreme notion of self-reliance, and the broad economic sanctions levelled against it by world powers, North Korea has had to largely concede on many fronts of it’s façade of self-reliance, whether that is food aid from South Korea, Diplomatic relations with China, trade deals with Trump, industrial espionage needed for upgrades to national infrastructure, development of ransomware and cyber heisting to fund their faltering economy.

Which brings me to a question. Differential accumulation is central to CasP, but how do we compare the relative power of states using fundamentally different modes of power?  North Korea seems to have gained a position of relative stasis of power through it’s isolationism, and while other states gain and lose power relative to each other, North Korea seems to plod along without significant change.

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