Omistaja, luovu ajoissa!

Sir Edmund Hillary ei ollut ensimmäinen, joka kapusi Mount Everestin huipulle, vaan useampi henkilö oli tehnyt sen jo ennen häntä. Hän vain oli ensimmäinen, joka tuli hengissä alas. Niinpä hänet myös muistetaan ja hän antoi valloitukselle kasvot. Vuorikiipeilijät tietävät, että vuorelle on helpompi kiivetä, kuin tulla sieltä alas. Sama pätee Les Nemethyn mukaan myös yrittäjiin: on helpompi yrittää viedä yritystä vuosi vuodelta eteenpäin kohti päämäärää, kuin todeta huipun tulleen saavutetuksi ja luopua.

Eläköidy johonkin, ei vain jostakin

Lopettaminen tai yrityksestä luopuminen on yrittäjällä yhtä vaikeaa kuin urheilijoilla uran päättäminen. Pahinta on lopettaa täydestä vauhdista täyspysähdykseen. H.E. Fosdickin neuvon mukaan on tärkeää olla jotain mielekästä tekemistä myös yritys- tai urheilu-uran jälkeen: "Don't simply retire from something, have something to retire to".

Olen kuullut useamman eläköityneen yrittäjän/yrityksen omistajan todeneen, että golf on kiva harrastus, mutta elämän pääsisältönä sitä ei kauaa jaksa. Niinpä he palaavat jollain tavalla liike-elämään, mutta eivät kuitenkaan entiseen rooliinsa. Tutkimukset osoittavat, että harva kaipaa takaisin lopettamisen jälkeen: Britanniassa 2006 tehty tutkimus osoitti, että vain 8% aiemmista perheyritysten omistajista kaipasivat bisnestään ja vain 18% harkitsisi koskaan palaavansa takaisin samaan bisnekseen. Useimmilla esimerkiksi hallitustyöskentely on hyvä tapa olla mukana liike-elämässä ja sosiaalisissa kontakteissa ilman, että joutuu kantamaan operatiivista vastuuta ja johdon kiirettä. 

Luovu ennen kuolemaasi

Ylivoimaisesti suurin ongelma yritysten sukupolvenvaihdoksissa on se, että omistajat eivät ymmärrä luopua ajoissa. Tärkein oppi ymmärrettäväksi olisi, että luopuminen ei tarkoita luovuttamista! Yrityksen myyminen ulkopuoliselle tai vetovastuun siirtäminen seuraavalle sukupolvelle ovat luonnollinen tapahtuma yrityksen elinkaaressa. Yritys ei saa olla elämäsi eikä kukaan voi olla korvaamaton. Liian usein asioita tehdään vasta pakon edessä, sairauden tai kuoleman kolkutellessa toimenpiteisiin.

Britanniassa tutkittiin tapauksia, joissa yritys oli ajautunut vaikeuksiin yrityksen myynnin tai sukupolvenvaihdoksen jälkeen. Tavoitteena oli selvittää, mikä on keskeisin syy vaikeuksille. Lähes puolessa tapauksia syy oli perustajan (47,7%) tai omistajan (29,8%) kuolema tai vakava sairaus ja sitä seurannut kaottinen tilanne. Vain harvoissa tapauksissa (16,4%) yrityksen ajautuminen vaikeuksiin seurasi suunnitelmallista luopumisprosessia ja (6,1%) hyvin harvoin silloin, kun omistaja oli pakotettu jäämään eläkkeelle. John Lennonin sanoin: "Life is what happens to you while you're busy making other plans."

Älä jätä rahaa pöydälle

Toinen keskeinen ongelma on luopumisprosessin suunnittelemattomuus. Nemethyn mukaan useat omistajat jättävät paljon rahaa pöydälle vain siitä syystä, että he eivät ole huolella suunnitelleet ja toteuttaneet irtautumistaan. Tämä ei siis tarkoita vain varsinaista myyntiprosessia vaan jo aikaisemmin tehtäviä valintoja, jotka määrittävät yrityksen arvon.

Yrityksen omistajana sinun pitäisi jatkuvasti kysyä itseltäsi: Kasvattavatko nämä valinnat, joita olen tekemässä yritykseni arvoa ulkopuolisen ostajan näkökulmasta? Nemethyn mukaan "there is no such thing as a good company or bad company, only a good valuation or a bad valuation" eli omista vääristä valinnoista maksaa viimeistään myyntihetkellä.

Poimintoja

• Don't congratulate us when we buy a company. Any fool can buy a company. Congratulate us when we sell it and when we´ve done something with it and created real value. - Henry Kravis
• If the terminal value constitutes more than 60-70% of the value of your business, then you should be suspicious. It is probably symptomatic of "a hockey stick" approach.
• Capital isn´t scarce, vision is. - Sam Walton, Walmart
• Start out with an ideal and end up with a deal. - Karl Albrecht, Aldi
• The only question with wealth is, what do you do with it? - John D. Rockefeller

Lähde:

Les Nemethy: Locking your company's value

Arvopaperin Blogi: Olen, siis omistan

Vierailin viime viikolla kirjoittajana Arvopaperin kumppaniblogissa. Kirjoitin omistamisen filosofisisista lähtökohdista eli itsensä omistajuudesta. Alla linkki Arvopaperin sivulle ja tekstini. 

Arvopaperi: Olen, siis omistan

Olen, siis omistan

Minä omistan itseni. Kuka muu minut omistaisi? Omistan sekä kehoni että mieleni. Omistan myös ajatukseni ja toimintani tulokset, omat aikaansaannokseni. Kenelle muulle ne kuuluisi? Olen, siis omistan. Kaikki me omistamme, ainakin itsemme. Itsensä omistajuus (self-ownership) on ihmisen elämän ja ihmisarvon perusta. Itsensä omistajuus on luonnollinen ja rajoittamaton ihmisoikeus. Ilman sitä olisimme muiden määräysvallassa olevia orjia. Omistajuus on erottamaton osa ihmisyyttä.

Koska olen ja omistan, mitä kaikkea minä omistan? Miten minä omistan? Miksi minä omistan? Miten huolehdin itsestäni ja omaisuudestani? Koska omistajuuden perusta on ihminen itse, kannattaa ensin investoida itseensä. On fiksua pitää huolta arvokkaimmasta omaisuudestaan eli kehostaan ja mielestään.

Toiseksi voi miettiä aikaansaannostensa arvoa. Mitä sellaista minä teen, ajattelen ja tuotan, millä on muille arvoa? Miten jaan tuotokseni ja saanko siitä kunnon korvauksen? Myynkö aikaani ja osaamistani työnantajalle kiinteää korvausta eli palkkaa vastaan vai toiminko suoraan omaehtoisena yrittäjänä? Oli työtapani kumpi tahansa, saan vastinetta tuotokselleni vain vapaaehtoisessa vaihdannassa. Vapaaehtoisessa vaihdannassa molemmat osapuolet saavat enemmän kuin antavat, muutoin vaihdantaa ei tapahtuisi. Molemminpuolinen lisäarvo on mahdollista siksi, että arvostamme asioita eri tavalla eri tilanteissa. Vaihdanta vapauttaa tämän yhteisen arvohyödyn.

Omaisuutta on kahdenlaista. On luonnollista omaisuutta, jonka saamme syntyessämme ja on karttuvaa omaisuutta, jonka saamme vain säästämällä. Säästäminen on teoriassakin ainoa tapa lisätä omaisuutta. Säästäminen tarkoittaa sitä, että kulutamme vähemmän kuin vapaaehtoisessa vaihdannassa saamme vastiketta. Tällöin kertyy vastikevarantoa eli varallisuutta. Myös perintö ja lahjat ovat vapaaehtoisen vaihdannan kautta saatua vaurautta, niistä vain emme ole joutuneet antamaan vastinetta. Samoin omaisuutemme arvonmuutokset, sekä nousut että laskut, ovat vaihdantaa, koska muutokset realisoituvat vain vaihdannassa.

Omaisuudellamme on kaksi arvoa. Ensinnäkin on subjektiivinen arvo eli omaisuuteni arvo minulle henkilökohtaisesti sellaisena kuin se on. Subjektiivisesti kannattaa omistaa sellaista varallisuutta, jolla on itselle eniten arvoa, siis joka parhaiten vastaa omaa arvomaailmaa. Pidä omaisuutesi siellä, missä on sydämesi.

Toiseksi omaisuudella on vaihdanta-arvo eli ostovoima, joka määräytyy markkinoilla vapaaehtoisessa vaihdannassa muiden ihmisten arvostuksista. Vaihdantatarkoituksessa kannattaa omistaa varallisuutta, jolla on muille eniten arvoa sekä nyt että etenkin tulevaisuudessa. Omaisuudestasi kannattaa pitää huolta, sillä ostovoimasi on yhtä kuin tuottamasi lisäarvon ja vaurautesi vaihtoarvon summa. Ostovoima on vapautta toteuttaa omia tavoitteita vaihdannassa.

Olemme ja omistamme, vaihdamme ja vaurastumme. Omistajuus kuuluu siis kaikille.

Tero Luoma, sijoitusjohtaja, Taaleritehtaan Pääomarahastot Oy

Schlichter: Paper Money Collapse

Euro hajoaa, kyse on vain siitä miten ja milloin. Tähän johtopäätökseen tulee väkisinkin, jos on uskominen Detlev S. Schlichterin Paper Money Collapse teosta.  Schlichterin argumentti on vahva, kaikki paperirahat eli rahat vailla luonnollista perustaa ovat yksi toisensa jälkeen hajonneet, ennemmin tai myöhemmin. Schlichterin mukaan markkinat ovat aina voittaneet valtion paperirahan ja vapaiden markkinoiden raha on aina ollut kulta tai hopea.

Detlev S Schlichter

Schlichterin kirjaa ei voi sivuuttaa kevyesti, sillä henkilöllä on sekä vahva finanssialan käytännön kokemus että vedenpitävät teoreettiset perusteet väittämilleen. Schlichterin kirja on tässä hetkessä silmiä avaavaa ja se olisi ehdottomasti oltava pakollista luettavaa finanssikriisin ongelmanaiheuttajille eli poliittisille päätöksentekijöille. Tämän kirjan luettuaan ajattelee väkisinkin käsillä olevasta finanssikriisistä toisin. Schlichter perustaa argumenttinsa Itävaltalaiseen koulukuntaan, ennen kaikkea Ludwig von Misesin teorioihin.

The Paper Money Collapse

Liiallinen velkaraha on finanssikriisin pääsyy

Ensinnäkin Schlichterin kirjaa auttaa ymmärtämään, kuinka finanssikriisin todellinen syy on liian halpa velkaraha eli poliittisilla päätöksillä muokattu liian alhainen korkokanta, joka on ajanut ensin perusteettomaan noususuhdanteeseen, ja nyt sen jälkeiseen lamaan. Luonnollinen korko perustuu ihmisten aikapreserenssiin eli siihen, kuinka paljon enemmän ihmiset arvostavat kuluttamista nyt versus kuluttamista myöhemmin. Tyypillisesti köyhissä talouksissa arvostetaan välitöntä tarpeen tyydytystä ja siten korkotasot ovat korkeita, kun taas vauraimmissa maissa kaikkia asioita ei tarvitse kuluttaa kerralla vaan voidaan odottaa ja siten korkotaso on alhaisempi.

Vain säästäminen lisää vaurautta

Vaurauden kehittymisen määrää ihmisten säästäminen. Vauraus syntyy siitä, kun nämä säästetyt varat investoidaan. Investointien myötä tuottavuus kasvaa ja tulevaisuudessa käytetävissä on enemmän tavaroita ja palveluita kuin nykyhetkenä on tai myöhemmin olisi, jos vain kulutettaisiin yhtä paljon kuin tuotettaisiin. Valitettavasti valtioilla on ollut tapana häiritä tätä vaurastumiskehitystä lykkäämällä markkinoille joko lisää rahaa käyttämällä valuuttamonopoliaan tai tukemalla muulla tavoin velkaantumista. Lopulta nämä toimenpiteet ovat sekoittaneet markkinoiden hintamekanismin ja ovat johtaneet vääriin investointeihin, joista sitten taantumassa maksetaan hintaa.

Finanssikriisiä ei ratkea rahaa painamalla

Toinen Schlichterin kirjan myötä selväksi tuleva fakta on se, että finanssikriisistä ei päästä yli painamalla lisää rahaa, kuten tällä hetkellä vallitseva poliittinen käsitys näyttäisi uskovan. Rahan painaminen ja Keynesiläiset opit vain siirtävät ja pahentavat tilanteen ratkeamista. Asian korjaaminen inflaatiolla ei ole oikea ratkaisu. Inflaation sijasta Schlichter pitää deflaatiota luonnollisempana ilmiönä taloudessa, sillä kehityksen ja vaurastumisen myötä tuotteiden hintojen pitäisi laskea eli kuluttajan ostovoiman kasvaa ennemmin kuin inflaation myötä hintojen kasvaa. Olemme kuitenkin liian tottuneita inflaatioajatteluun ja lopulta valuutan omaisuuserien arvoa tuhoavaan voimaan, että emme edes kykene näkemään deflaatiota varteenotettavana vaihtoehtona.



Rahan määrällä ei ole merkitystä taloudessa

Monelle myös Schlichterin väite, jonka mukaan rahan määrällä ei ole merkitystä taloudessa, on hyvin vaikea käsittää. Näin se vain on. Rahan määrä ei lisää vaurautta eikä paranna talouden toimivuutta. Se vain muuttaa rahan yksikön ostovoimaa. Varsinaiset omaisuuserät (assets) eivät muutu mihinkään maailmassa, vaikka seteleitä painaisi kuinka paljon lisää. Siispä rahan painaminen ja finanssikriirin korjaaminen inflaation kautta ei edes teoriassa voi olla ratkaisu ongelmaan. Ennemminkin sillä haetaan ratkaisua valtion velkaongelmaan eli velkaiset valtiot kuittaavat omat velkansa käyttämällä monopolioikeuttaan painaa rahaa. Jos jokaisella velallisella olisi sama oikeus, olisi velallisena eläminen varsin mukavaa. Valitettavasti tämä operaatio toteutetaan ennen kaikkea säästäjien eli velkojien ja varallisuuden omsitajien kustannuksella.

Ratkaisu eurolle: kiinnittyminen kultakantaan?

Schlichterin ratkaisu finanssikriisiin on selkeä: paluu kultakantaan. Liian moni vain ajattelee kultakannan kuuluvat menneille vuosikymmenille, eikä pysty näkemään silloin tehtyjä virheellisiä poliittisia päätöksiä, joilla kultakannasta luovuttiin. Amerikassa sentään Ron Paul on pitänyt yllä vaihtoehtoa kultakantaan palaamisesta. Euroopassa tätä skenaariota kukaan poliittinen päättäjä ei ole uskantanut sanoa ääneen.

Entä siis jos euro pelastettaisiinkin liittämällä se kultakantaan? Meillä säilyisi yhä euro valuuttana, saisimme sen tuomat edut ja meillä olisi käytössä vakaalla pohjalla oleva valuutta, jota ei pystyisi yksittänen taho poliittisilla päätöksillä manipuloimaan. Veikkaan, että kyseessä olisi ylivoimainen maailmanvaluutta esimerkiksi nykydollariin verrattuna. Siinä olisi kerrassaan eurooppalainen ratkaisu! 

Poimintoja

• In principle, a society can use banknotes, electronic money transfers, and credit cards and still be on a strict commodity system, such as a gold standard. 
• A growing supply of money seems to most people to be the natural corollary of a growing economy. As surprising as it may sound, this is not the case. A growing economy does not need a growing supply of the medium of exchange. It is indeed in the very nature of a medium of exchange that - within reasonable limits - practically any quantity of it is sufficient to accommodate any number of transactions. An economy does not need more money to produce and trade more goods and services, to increase its productivity and to generate more wealth. 
• Money creation in our present financial system is not the natural outcome of the market and the spontaneous interaction of members of the public but a governmental tool for shaping the conditions of the economy. 
• It is simply a historic fact that commodity money has always provided a reasonably stable medium of exchange, while the entire history of state paper money has been an unmitigated disaster when judged on the basis of price level stability. 
• In an economy in which the supply of money is essentially fixed, the production of additional goods and services must lead to lower prices over time. But this type of deflation does not pose an economic problem. Quite the contrary, it has many advantages. 
• The recommendation from the British and Austrian economists was clear: If you want to avoid recessions, you must avoid artificial investment booms generated by cheap credit. Stick to a proper gold standard and restrict the practice of fractional-reserve banking! In other words, make money less elastic. Since the early part of the twentieth century, however, a very different policy has been pursued. 
• Since 1971, the entire world has thus been on paper money standard for the first time in history. Money can be created out of nothing, at no cost and without limit. 
• There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved. - Ludwig von Mises, 1949
• The history of paper money systems is a legacy of failure. Without exception paper money systems have, after a while, led to economic volatility, financial instability, and rising inflation. If a return to inelastic commodity money was not achieved in time, the currency collapsed, an event that was invariably accompanied by social unrest and economic hardship. 
• Money is the medium of exchange. Money is useful only is there is exchange, and exchange is possible only if property or, more precisely, private property exists. 
• Capitalism can be defined as "a social system based on the explicit recognition of private property and of nonaggressive, contractual exchanges between private property owners." In such a system money will quickly become indispensable. 
• It is in the interest of everybody who wants to participate in the free, voluntary, and mutually beneficial exchange of goods and services to use media of exchange. Indeed, it is in the interest of everybody to ultimately use only one good as medium of exchange, the most fungible good, and that good is called "money". 
• Money is not the creation of state. It is not the result of acts of legislation and its emergence did not require a society-wide agreement of any sort. Money came into existence because the individuals who wanted to trade found a medium of exchange immediately useful. And the more people began to use the same medium of exchange, the more useful it became to them. 
• Money is a social institution that came about spontaneously. Other such institutions are the concepts of private ownership and of clearly delineated property and the rules and standards accounting to which property titles can be transferred. 
• Yet, as the Austrian economist Carl Menger showed more than one hundred years ago, money could have come into existence only as a commodity. For something to be used, for the very first time, as a medium of exchange, a point of reference is needed as to what its value in exchange for other goods and services is at that moment. It must have already acquired some value before it is used as money for the first time. That value can only be its use-value as a commodity, as a useful good in its own right. But once a commodity has become an established medium of exchange, its value no longer be determined by its use-value as a commodity alone but also, and ultimately predominantly, by the demand for its services as money. But only something that has already established a market value as a commodity can make the transition to being a medium of exchange. 
• Money is valued because of what you can buy with it. If an individual has more money, that individual can buy more goods and services from the producers of goods and services. But if society overall has more money, meaning that society has a bigger quantity of the money substance, society is not richer. It has more of the medium with which to exchange things but it has not more things to exchange.
• Any amount of the good money is optimal. Any quantity of the money commodity or money substance will be sufficient to allow the money commodity to fulfill all functions of a medium of exchange. 
• Societies that have more goods and services are richer. Societies that have more "paper money" of book-entry money are not richer. 
• Demand for money is not demand for wealth. In colloquial speech it is often assumed that everybody wants more money, that the demand for money is therefore limitless. But what people mean by this is demand for wealth, for control over goods and services, but not demand for the medium of exchange as such. Money has no direct use-value. Goods and services have use-value. Thus, nobody would want to hold all his wealth all the time in the form of money. 
• People have demand for money because they want to be ready to trade.
• It is the uncertainty and unpredictability of life that causes people to hold monetary assets. People hold some of their wealth in money because they want to have the flexibility to engage in exchange transactions quickly and spontaneously. In a world of no uncertainty, there would be still transactions but no need to hold monetary asset.
• No new money needs to be produced to meet additional demand for money. 
• Once good is established as money, no additional quantities of this good are needed. The performance of an economy is independent of the supply of money. Within reasonable limits, any quantity of money is optimal. Money production is redundant. Supply and demand for money can always be brought in line by changes in money's purchasing power. Society overall and every individual in society can satisfy their demand for the monetary asset without the help of ongoing money production. 
• A medium of exchange logically requires that other use the same form of money, too. Widespread use is the precondition for a good to be money. Universal use would be ideal. Customized money is a logical impossibility. Indeed, the more universally accepted a good is as money the more valuable it will be as a medium of exchange. 
• Friedrich August von Hayek suggested in his book Denationalization of Money (1976) that the state's territorial monopoly of money printing should be revoked and the supply of paper money opened up to the competition of private money producers. 
• Gold was the first, and has so far been the only, practically global medium of exchange. 
• I do not think that many people today realize that the abandonment of the international gold standard and its replacement with multitude of local paper money franchises under state control during the twentieth century constituted economic regression and not progress. 
• The desire by every government to issue its own paper money for its own political reasons is a powerful hindrance to global market integration and effective division of labor and human cooperation across political borders. 
• In short, about 80 percent of what is money according to Federal Reserve definition is a balance sheet item at a bank. 
• Banks are not even in the business of satisfying demand for money. Banks are in the business of taking deposits and making loans. They are operating in the credit market. The demand that is relevant to their business is the demand for loans. 
• The first bankers were goldsmiths. When money was essentially gold or silver, goldsmiths entered the field of financial services quite naturally, first by assessing the metal content of gold or silver coins, for which they were uniquely qualified, and later by also taking gold or silver money on deposits and by lending gold and silver money against interest. 
• Pecunia pecuniam parere non potest, as was already understood in ancient Rome: Money cannot beget money. In order for any income to be generated, the money has to be spent, or be used as a "reserve" for the banker's issuance of fiduciary media as part of his loan business. 
• This in an aspect of banking that is often not fully appreciated even today. Whenever we pay money into a bank we exchange ownership of money for ownership of a claim against the bank. "Money, when paid into bank, ceases altogether to be the money of the principal; it is then the money of the banker, who is bound to an equivalent by paying a similar sum to that deposited with him when he is asked for it... The money placed in the custody of a banker is, to all intents and purposes, the money of the banker, to do with it as he pleases; he is guilty of no breach of trust in employing it; he is not answerable to the principal if he puts it into jeopardy, if he engages in a hazardous speculation; he is not bound to keep it or deal with it as the property of his principal; but he is, of course, answerable for the amount, because he has contracted."
• All types of money can today be created practically without limit. 
• Loan demand is not an independent entity to which the banks only respond passively. All else being equal, lower rates mean higher loan demand. 
• A paper money system and a fractional-reserve banking system are confidence-based. Once the confidence goes, the system collapses. 
• Our society does not live with an ever-expanding supply of money because its individual members need more money or demand more money but because the money producers decide supply it. 
• Saving gets us genuine growth: credit expansion gets us boom and bust. 
• Only voluntary saving from the consumer can redirect resources from consumption to investment in accordance with consumer's preferences. This is why saving is ultimately essential for the expansion and maintenance of the capital stock, which requires, after all, real resources, including labor, to sustain it. 
• Money creation in today's financial architecture is decidedly not a market phenomenon. 
• More money does not mean more economic activity; and more economic activity does not require more money. 
• Only goods and services can fulfill people's desires. Money as such cannot do it. 
• It is the mark of poor societies that they need most or all of their available resources for present consumption, often literally for feeding, clothing, and sheltering the population. Richer societies have resources that are not needed for present consumption, that are saved, invested, and become capital goods. The purpose of capital goods is to produce consumption goods, but the capital goods now allow for production processes that have a higher physical productivity. 
• Just as an economy does not need more money in order to produce more goods and services, an economy does not need more money to have more investment and more saving or more capital. If that were the case, poor countries could become richer by simply printing more money.
• Interest is an integral part of human action. The underlying concept of interest would be detectable even in a human society that did not know money and did not have a market for loans. Because even in such society every person would certainly value the same good or service differently depending on whether it were available today or only at a later point in time. This is called time preference and is an essential component of any act of valuation. "Present goods are valued higher than future goods of the same kind and quantity" said Mises. 
• All other things being equal, to want something is to want it sooner rather than later. If things in some remote future were as valuable to me as anything today, I would never get up and try to obtain anything. Human action necessitates time preference. 
• Interest is, first and foremost, simply the ratio of the value assigned to present goods over future goods. We can think of the interest rate as the discount rate at which the two values would be equal. Interest is therefore a ratio of prices, not a price itself. Interest always involves an act of valuation, which, by definition, is subjective and bound to change over time and from person to person. Therefore, interest reflects the current value assessment of economic agents, specifically, how they value goods and services of the same kind at specific point in time. Interest in then the direct expression of time preference. If time preference is high, meaning the value assigned to the satisfaction of present need is high, interest will be high and future goods will be assigned a more heavily discounted value compared to present goods. If time preference is low, meaning the value assigned to the satisfaction of present needs, interest will be low and future goods will be discounted less heavily. 
• Members of a poor society are likely to have a high time preference. In a poor society interest rates will therefore tend to be high. 
• The level of interest rates does not depend on the amount of money in the economy. An economy that has more money does not have lower interest rates. The level of interest depends on the time preference of the economic agents, their subjective valuation of present goods versus future goods. Equally, the level of interest does not depend on any attributes of the existing capital stock, such as its physical productivity, as was believed by classical economists. The idea that the productivity of the existing capital stock determines the level of real interest rates, that is, market rates adjusted for an inflation risk premium, is still widespread among financial market professionals today. This productivity approach to real interest rates is an entirely erroneous concept. It can be easily refuted. 
• By employing more resources in production processes of higher productivity, more goods and services can be produced: this makes it even easier to fulfill present consumption needs and the wealthier population will now have - all else being equal - an even lower time preference, which leads to a larger share of the now enhanced supply of goods and services being directed toward production. This powerful tendency causes rich countries to get richer. 
• For any society that prefers more goods and services to fewer goods and services, a high saving rate and low interest rates are certainly desirable.
• Low interest rates are of no use but, indeed, harmful if they do not correspond with the population's time preference. 
• Increased investment is not the result of lower interest rates but of increased voluntary saving on the part of consumers. Lower interest rates indicate the increased propensity to save an assure that increased saving leads to increased investment. The driving force behind the increase in investment is a change in valuations by the consumer.
• Money does not change the elementary valuations at the core of the market process, namely the wishes and preferences of the consumer, among them, importantly, time preference. More money is not needed for growing economy, for an expanding productive sector, for saving and investment, and for the creation of wealth. But expanding the supply of money disturbs relative prices, first and foremost interest rates, and disorients market participants. 
• The conclusion for policy makers is clear: Do not try to artificially lower interest rates and create extra growth through cheap credit. After a short-term boom you will face a recession. IF you want to avoid a recession, you have to keep the supply of money inelastic and allow voluntary saving to determine interest and credit on an unhampered market. 
• The roots of the recession lie in the preceding false boom. 
• The essential truth is that an expanding supply of money, all else being equal, will lead to a drop in the purchase power of the monetary unit. 
• There is no escape from the conclusion that a recession will not be avoided but, at best, be postponed by artificially lowering interest rates again and by injecting even more money when the initial boom peters out. The recession if the inevitable and necessary, if painful, process by which prices and productive structures get realigned with consumer preferences. The economy gets cleansed of the misallocation of resources and the misdirection of economic activity that were necessary preconditions of the false boom. 
• In fact, no paper money system in history has survived. Either a voluntary return to commodity money was accomplished before a complete currency meltdown occurred, or the system collapsed in hyperinflation and economic and social chaos. 
• Today's fear of deflation is unfounded. It appears that after almost a hundred of years of global inflation, the possibility of an ongoing rise in the monetary unit's purchasing power has become a strange and discomforting concept to many people, making them susceptible to the scaremongering of parties who have a vested interest in ongoing money expansion and inflation. However, if one think about it dispassionately and rationally, a countinuous decline in nominal prices seems to be a more natural condition for a growing economy in which people get, on trend, wealthier, than the artificial weakening of money's purchasing power trough its constant overissuance by those who control the money supply. 
• For a society to become richer means that thing become more affordable. 
• Money is never neutral, has never been neutral, and can never be made to be neutral. 
• "All else being equal" never works in the real world. 
• As different goods are of different importance to different people, for some people the purchasing power of their money holdings will have risen, and for others it might have declined or stayed roughly unchanged. The idea that there is such a thing as one specific and identifiable purchasing power of money, one universally applicable price level, is a fantasy. 
• In a commodity money system, the monetary asset is likely to provide a small steady return through the on-trend decline in prices, which allows those without investment expertise to save through cash holdings. 
• Paper money systems are creations of the state. ... Historically, the reason why paper money was introduced has been this one: to fund state expenditure to finance war. 
• State intervention always socializes the cost of business failure and thus encourages more reckless risk taking in the future, which will lead to more crises. 
• All underconsumption theories suffer from an irrational fear of savings and a lack of appreciation of the pricing mechanism. Saving, consumption and investing are interconnected and coordinated via market prices, including interest rates. Saving is the basis for prosperity. No society has ever risen, nor could any society conceivably ever rise, out of poverty and into prosperity via consumption. It is saving and production that generate wealth. By shifting resources from meeting present consumption needs and by allocating them to productive uses to meet future consumption needs, that is, by saving and investing, society generates the capital stock that raises the productivity of labor and allow a larger supply of goods and services, and also different and better goods and services. Of course, it exercises "effective demand". To save is to spend; it is simply spending on different things. He who saves does not never want to consume. He wants to consume later. And those who take his savings in the meantime and use it to build productive capital sell their produce practically to the same saver at the point when he finally wants to consume. Saving means postponing consumption, not nonconsumption.
• Once a recession becomes unavoidable, neither more money printing nor Keynesian defcit spending constitutes a solution. 
• Recessions are corrections of previous misallocations of capital. 
• Fiat money systems have historically always led to high inflation, ending usually in total currency collapse. 
• Market forces will win in the end. The only question is if this happens before money is destroyed of after money is destroyed. 
• We should see a persistent trend toward investment in more tangible assets, in assets the supply of which cannot be expanded easily, such as hard and soft commodities, certain forms of real estate, forestry, and arable land. But of particular interest will undoubtedly be the precious metals, gold and silver, which are the most essential self-defence assets in any paper money crisis. ... Government bonds and bank bonds are going to come under pressure. The public will also reduce bank deposits, and try to minimize their holdings of paper money. 
• In all paper money crises, the public returned to the eternal forms of money - to gold and silver, and in particular gold. It will not be any different in this crisis. 
• It is sometimes maintained that holding gold is not a sensible investment strategy because gold does not offer a steady return. It does not pay interest or dividends. Indeed holding gold is "negative carry trade", because the investor in gold has to pay for storage and insurance. But this is entirely beside the point. Gold is not an investment good; it is money. 
• At any moment, all our personal wealth can be divided into three categories: consumption goods, investment goods, and money. 
• Capitalism, properly understood as a system built entirely on private property and voluntary, nonaggressive exchange between independent property owners, requires smooth operation apolitical and hard commodity money. The money of the free market has always been gold or silver. 
• One sometimes hears the view that there is not enough gold around to resurrect the gold standard. This statement has no basis in fact. It has been shown that, within reasonable limits, any amount of gold is sufficient to function as money. No economy operates better or worse because of the available amount of money.

Hernando de Soto: The Mystery of Capital

Mitä on pääoma? Tähän kysymykseen haen näkökulmia seuraavissa blogikirjoituksissani. Michel Foucaultin mukaan vastakohta määrittää myös itse kohdetta. Siis pääomaa määrittää pääomattomuus. Mitä sitten on pääomattomuus? Siihen kysymykseen oivan vastauksen antaa Hernando de Soton teos The Mystery of Capital - Why Capitalism Triumphs in the West and fails everywhere else.

Hernando De Soto

Kuollut pääoma

Hernando de Soto on perulainen taloustieteilijä, joka on keskittynyt tarkastelemaan omistusoikeuden merkitystä erityisesti kehittymättömissä talouksissa. De Soton pääviesti on, että markkinatalous edellyttää toimiakseen tietojärjestelmän, joka huomioi ja määrittelee omistusoikeudet. Omistusoikeuksien puute estää pääomien syntymisen, ihmisten elinolosuhteiden parantumisen ja siten talouden kehittymisen. Erityisesti puutteellinen maanomistusoikeus on keskeinen tekijä, joka estää elinolosuhteiden kehittymisen. De Soton argumentti on hyvin järkeenkäypä. Kuka rakentaisi talon maalle, jonka omistusoikeudesta kenelläkään ei ole tietoa ja jonka oikeuden valtio tai muu taho voi milloin tahansa viedä pois? Ilman omistusoikeuksia ja omistusten rekisteröintiä ei synny pääomaa eli omaisuutta, jolla on arvoa ja jota voidaan käyttää lainojen vakuutena tai vaihdannan kohteena. De Soton mukaan kehittymättömissä talouksissa on kyllä varoja (assets), mutta ei omaisuutta (property). Tätä paradoksia hän kutsuu kuolleeksi pääomaksi (dead capital). 

The Mystery of Capital

Pääoma on kuin energia

De Soton analyysi kehittymättömistä talouksista on silmiä avaava. Ei siis ihme, että hänen näkemyksiään on kehuttu ja kiitelty sekä politiikan vasemmalla että oikealla laidalla.  Länsimaissa omistusoikeudet ja siten pääoma otetaan nykyään lähes itsestäänselvyytenä. Kuitenkin fakta on, että näin ei ole suurimmassa osassa maapallon maita. Länsimaisena on hyvin vaikea kuvitella maata, jossa kukaan ei tiedä kuka omistaa mitä, kotiosoitteita ei voida vahvistaa, ihmisillä ei ole mahdollisuuksia lainansaantiin, resursseja ei voi muuttaa rahaksi, omaisuutta ei voi jakaa osakkeiksi, omaisuuseriä ei voi vertailla ja omaisuutta koskevat säännöt vaihtelevat alueittain tai niitä ei ole lainkaan. De Soto vertaa  pääomaa osuvasti myös energiaan, koska yhtälailla pääomaa itsessään ei voi nähdä ja koskea.  Silti sen vaikutukset ovat merkittävät. 

The Mystery of Capital on suositeltava kirja luettavaksi. Yhdessä Dambisa Moyon Dead Aidin kanssa ne muodostavat hyvän, vaihtoehtoisen näkökulman kehitysmaiden ongelmiin. De Soto tarjoaa kirjassaan useita määritelmiä pääomalle ja omaisuudelle sekä valaisee perustellun näkemyksen kapitalismin pohjimmaisiin peruselementteihin. De Soton sanoman mukaan on selvää, että yksityinen omistajuus ja ihmisten tunnistettu ja tunnustettu oikeus omistaa ovat kapitalistisen järjestelmän kovinta ydintä. Ilman näitä ei ole markkinataloutta ja ilman markkinataloutta ei ole vaurautta. 

Poimintoja

• The major stumbling block that keeps the rest of the world from benefiting from capitalism is its ability to produce capital. Capital is the force that raises the productivity of labor and creates the wealth of nations. It is the lifeblood of the capitalist system, the foundation of progress, and the one thing that the poor countries of the world cannot seem to produce for themselves, no matter how eagerly their peoples engage in all other activities that characterize a capitalist economy.
• Most of the poor already possess the assets they need to make a success of capitalism. Even in the poorest countries the poor save. ...But they hold these resources in defective forms: houses on land whose ownership rights are not adequately recorded, unincorporated businesses with undefined liability, industries located where financiers and investors cannot see them. Because the rights to these possessions are not adequately documented, these assets cannot readily be turned into capital, cannot be traded outside of narrow local circles where people know and trust each other, cannot be used as collateral for a loan and cannot be used as a share against an investment.
• Imagine a country where nobody can identify who owns what, addresses cannot be easily verified, people cannot made to pay their debts, resources cannot conveniently be turned into money, ownership cannot be divided into shares, descriptions of assets are not standardized and cannot be easily compared, and the rules that govern property vary from neighbourhood or even from street to street.
• By our calculations, the total value of the real estate held but not legally owned by the poor of the Third World and former communist nations is at least USD 9.3 trillion.
• In medieval Latin "capital" appears to have denoted head of cattle or other livestock, which have always been important sources of wealth beyond the basic meat they provide.
• The term capital begins to do two jobs simultaneously, capturing the physical dimension of assets (livestock) as well as their potential to generate surplus value.
• Great classical economist such as Adam Smith and Karl Marx believed that capital was the engine that powered the market economy. Capital was considered to be the principal part of the economic whole - the pre-eminent factor as such phrases as capital issues, capital punishment, the capital city of a country.
• Much of the mystery of capital dissipates as soon as you stop thinking of capital as a synonym for money saved and invested.
• Capital, like energy, is also a dormant value. Bringing it to life requires us to go beyond looking at our assets as they are to thinking actively about them as they could be. It requires a process for fixing an asset's economic potential into a form that may be used to initiate additional production.
• Property is the realm where we identify and explore assets, combine them and link them to other assets. The formal property system is capital's hydroelectiric plant. This is the place where capital is born.
• Property is the realm where we identify and explore assets, combine them and link them to other assets. The formal property system is capital's hydroelectric plant. This is the place where capital is born.
• Any asset whose economic and social aspects are not fixed in a formal property system is extremely hard to move in the market. How can the huge amounts of assets changing hands in a modern market economy be controlled if not through a formal property process? Without such a system, any trade of an asset, say a piece of real estate, requires an enormous effort just to determine the basics of the transaction: does the seller own the real estate and have the right to transfer it? Can he pledge it? Will the new owner be accepted as such by those who enforce property rights?
• Even if assets belong to a corporation, real people still own them indirectly, through titles certifying that they own the corporation as "shareholders".
• The process within the formal property system that breaks down assets into capital is extremely difficult to visualize.
• Property, like energy, is  a concept; it cannot be experienced directly. Pure energy has never been seen or touched. And no one can see property. One can only experience energy and property by their effects.
• Capital is born by representing in writing - in a title, a security, a contract and other such records - the most economically and socially useful qualities about the asset, as opposed to the visually more striking aspects of the asset.
• The proof that property is pure concept comes when a house changes hands; nothing physically changes. Looking at a house will not tell you who owns it. A house that is yours today looks exactly as it did yesterday when it was mine. It looks the same whether I own it, rent it or sell it to you. Property is not the house itself but an economic concept about the house, embodied in a legal representation. This means that a formal property representation is something separate from the asset itself. ... A formal property representation such as a title is not a reproduction of the house, like a photograph, but a representation of our concept about the house. Specifically, it represents the non-visible qualities that have potential for producing value. These are not physical qualities of the house itself but rather economically and socially meaningful qualities we humans have attributed to the house (such as the ability to use it for a variety of purposes that may be secured by liens, mortgages, easements and other covenants).
• Legal property gave the West the tools to produce surplus value over and above its physical assets.
• As Aristotle discovered 2300 years ago, what you can do with things increases infinitely when you you focus your thinking on their potential.
• Formal property's role in protecting not only ownership but the security of transactions encourages citizens in advanced countries to respect titles, honour contracts and obey the law.
• The lack of legal property explains why citizens in developing and former communist nations cannot make profitable contracts with strangers, cannot get credit, insurance or utilities services: they have no property to lose. Because they have no property to lose, they are taken seriously as contracting parties only by their immediate family and neighbours. People with nothing to lose are trapped in the grubby basement of the pre-capitalist world.
• Thanks to formal property, a single factory can be held by countless investors, who can divest themselves of their property without affecting the integrity of the physical asset.
• Many title systems in developing nations fail to produce capital because they do not acknowledge that property can go way beyond ownership. These systems function purely as an ownership inventory of deeds and maps standing in for assets, without allowing for the additional mechanisms required to create a network where assets can lead a parallel life as capital.
• Property is not mere paper but a mediating device that captures and stores most of the stuff required to make a market economy run. Property seeds the system by making people accountable and assets fungible, by tracking transactions, and so providing all the mechanisms required for the monetary and banking system to work and for investment to function. The connection between capital and modern money runs through property.
• Money does not earn money. You need a property right before you can make money. Even if you loan money, the only way you can earn on it is by loaning or investing it against some kind of property document that establishes your rights to principal and interests. To repeat: money presupposes property.
• Money is never created ex nihilo from the point of view of property which must always exist before money can come into existence.
• Interest and money cannot be understood without the institution of property.
• Capital is not created by money; it is created by people whose property systems help them to cooperate and think about how they can get the assets they accumulate to deploy additional production.
• If capitalism had a mind, it would be located in the legal property system.
• The bell jar makes capitalism a private club, open only to a privileged few, and enrages the billions standing outside looking in. This capitalist apartheid will inevitably continue until we all come to terms with the critical flaw in many countries' legal and political systems that prevents the majority from entering the formal property system.
• Land is probably Russia's most valuable resource, a resource upon which an entire economy and a democratic society can be based.
• Only 7% of the land on the Indonesian archipelago has a clear owner.
• Property is socially constructed. This means that property arrangements work best when people have formed a consensus about the ownership of assets and the rules that govern their use and exchange. 
• Everyone will benefit from globalizing capitalism within a country, but the most obvious and largest beneficiary will be the poor. 
• Private property is arguably the single most important institution of social and political integration. Ownership of property creates a commitment to the political and legal order since the latter guarantees property rights: it makes the citizen into a co-sovereign, as it were. As such, property is the principal vehicle for inculcating in the mass of the population respect for law and an interest in the preservation of the status quo. Historical evidence indicates that societies with a wide distribution of property, notably in land and residential housing, are more conservative and stabler, and for that reason more resilient to upheavals of all sorts. - Richard Pipes.
• When poor people have confidence that their land and businesses are legally theirs, their respect for other people's property increases. Owning formal property also tends to discourage unruly behaviour. 
• Formal property is more that just ownership. 
• Only twenty-five of the world's two hundred countries produce capital in sufficient quantity to benefit fully from the division of labor in expanded global markets. The lifeblood of capitalism is not the Internet or fast-food franchises. It is capital. Only capital provides the means to support specialization and the production and exchange of assets in the expanded market. It is capital that is the source of increasing productivity and therefore the wealth of nations. 
• Growth is all about obtaining high-value outputs from low-value inputs. 
• The notion that, value of things can be increased by reducing the costs of knowing them and transacting with them, is one of Nobel laureate Ronald Coase's major contributions. In his treatise The Nature of the Firm Coase established that the costs of carrying out transactions can be substantially reduced within the controlled and coordinated context of a firm. In this sense property systems are like Coase's firm - controlled environments to reduce transaction costs. 
• Ironically, the enemies of capitalism have always seemed more aware of the virtual origin of capital than capitalists themselves.