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Message: [QUOTE="zachvac, post: 1144610, member: 26306"] ok I've actually thought a good deal about this. I'm of the opinion that the only regulations should be those enforcing anti-trust laws (because lack of competition defeats the purpose of free market capitalism) and enforcing contracts. Note that means with this regulation Madoff would not have gotten away with it because he was not honest with what he was selling. Anyway, yes this means I would be for the abolition of the minimum wage and many other such ideas that others consider radical. I find it kind of funny that you talk of the lazy rich as well. Name me a few people who are rich that are not earning their money. Obviously the work of a CEO is far different from that of a blue-collar worker, but the value of work is what someone is willing to pay for it. It's good old fashioned supply and demand, if what the people bring to the company is worth the salary they pay them, that means their work is obviously worth that much, is it not? Obviously with recent events and government bailouts (which as you can tell by my signature, I completely opposed), these companies got money they would not have gotten if we had stuck to free-market capitalism, and used it to pay executive bonuses. No surprises there, they were a failing company, why would you expect them to do anything but take the money you give them and run? With a free market approach the companies would go under. There would be a small period where the market would adjust to make up for the fact that the bubble burst and the companies made bad forcasts. The housing companies thought they could sell them at a higher price. Now for their failed predictions they're going to have to eat the cost. That's what the free market is about, it provides an incentive all on its own that is completely defeated when the government starts bailing people/corporations out. In a poker game, if I have 20% to win and am only getting 2:1 I snap fold. If on the other hand I have 20% to win and triple up (what 2:1 means) and the other 80% I get my money back from the government, it's an easy call. These bailouts encourage this dangerous speculation, while without the prospect of being bailed out when they fail, the free market would ensure that speculators actually have an incentive to be successful. Anyway, let's get back to the OP. Poker is a great example of how great a free market is, but in and of itself is not an economic system. In an economic system we are able to produce as much wealth as we consume (consume defined as for example using it to buy food that will lose all value once we eat it, the loss in value of a home as we live in it, etc.). In fact let's go back to the beginning. It is possible for humans to hunt their own food, build their own houses (more like huts), and live in the wilderness and basically make everything individually. Then comes specialization. One guy hunts 10 deer, one guy builds 10 houses, etc. and all of a sudden they can do more because specialization has enabled people to produce more wealth. If say there were 10 vital services needed to live, I could build 10 houses way faster than I could build a house, hunt, and do all 10 things basically. Sorry this is a bit abstract but I'd like to start at the basics. With specialization and then the beginning of machinery, we all become more efficient so we can have more. Now we can have one person producing several thousand things so we can use all of these, note that this still assumes all "things" are of equal value, we'll get off of that later. So if a thousand people can produce a thousand of one thing each, now all of a sudden everyone can have a car, a house, a plot of land, a vacation, an education, a computer, and can afford entertainment. All of this comes directly from specialization and machinery. Now we recognize that not everything is worth the same amount, and not everyone can produce the same amount of everything. If you can produce 10 cars in a day and another person can produce 10 hamburgers in a day, they're not going to swap and call it even. If he wanted to, the car producer could produce 9 cars and say 2 burgers. Even though the previous example is more efficient, 10 cars is clearly worth more than 9 cars and 2 burgers, the second example is important as well. It's the threat of competition, this drives prices down. The burger guy knows he has to sell it low or else someone else will start producing and selling lower. This is basic economics and can be summed up with a supply and demand graph. With this model in mind, assuming anti-trust laws are enforced (see above for where I mentioned acceptable regulations), what you are able to be paid is exactly what you are worth. If you are worth more, you would be able to find someone to pay you more for your services. Now here's where exessive greed is a good thing. Say your work is worth 100k/year, so someone would be able to still make a profit from receiving your work and paying you 100k/year. But the guy who would be paying you already earns 15 million/year. He doesn't care whether he gets an extra 10k profit from you (ie 110k increase, pays you 100k, net of 10k), 15 million and 15.01 million are the same right? So he hires his friend who slacks off, doesn't work hard, and costs the company money. But it's only a few grand, and the millionaire isn't greedy. So now the economy is less productive, because less goods are produced, and you unfairly have to take a job for less despite being worth 100k in a completely free market with greed and competition. Contrast that with the millionaire who wants every bit of money he can. He has 15 million in the bank but he wants 15 million and a cent damnit. He is a jerk and fires people over stealing paperclips, doesn't let them take much time off, etc. But he is efficient, he hires the best employees for the job, and attempts to maximize his profits. Now the economy wins because more goods are produced at a lower price (ie he's using his money efficiently, not wasting money on bad investments through bad employees) and hard work is effectively rewarded, which is the entire driving purpose of free market capitalism. When hard work and production are rewarded, the market is most efficient so it's a win-win in my book. The hard-working/intelligent/productive get rewarded and the goods are used efficiently. Which gets us into speculation and poker which are extremely similar the more I think about it. I have a decent article on the purpose of speculators in the economy. It does a much better job than I can every do of explaining it but bottom line is that they keep prices as close as possible to their true value as well as punish bad speculators. Like I said I'll post an article on that but I'm going to discuss how that relates to poker. Let's look at input and output to the poker economy. The input is obviously all from players depositing. The output goes to rake, winning players, and taxes. Now let's look at a losing player. There are a few categories. 1. The social gambler, wants to play for fun and knows ahead of time he's donating x amount of dollars for a good time and a chance to maybe get lucky, but he understands he's bad, doesn't try to play good, and realizes his ev is very bad (even if he doesn't think in those terms). This gambler doesn't fall under the speculator tab, but under the services tab. The winning players are providing a service to the social gambler. They get the money, he gets a fun time, casino gets its rake, it's a win-win. This entertainment is obviously worth exactly what he pays for because that's how much he's willing to spend on it. 2. The bad social player, very much like #1 however he thinks he's better than he is. He plays for fun and doesn't study but unlike #1 he thinks he's at least break-even or maybe a slight loser when in reality is just a huge donator. Here the winning players fund his entertainment but mainly make their money off his incorrect speculation. He speculates that his ev is close to neutral and is willing to pay a few bucks for the entertainment. In reality he's spending much more than a few bucks and the free market correctly punishes him for his bad speculation. He invested in himself, thinking he was worth more than he actually was, and this bad investment punishes him for making it, much like someone investing in a stock that's likely to fail. 3. Bad player, there to win but he sucks and doesn't know it. Not gonna go into too much detail because it's basically #2 although he thinks his ev is positive when in reality it's negative. In fact we can even expand this analogy to winning players. Say someone wins at 0.5 PTBB/100 and thinks the game is worth playing if his ev is 1.5 PTBB/100. He's undder the mistaken impression that he is a 3 PTBB/100 winner. He's losing value here, because in his mind it is not worth the 0.5 but that's what he's getting. The opportunity cost of playing poker is not worth it because of his incorrect speculation. And because of this in the long run he will net a loss if we include opportunity cost all because of his incorrect speculation. Hopefully this made sense, feel free to respond to anything here, I realize this is only an opinion and am interested to hear other opinions. [/QUOTE]

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