**Submission Statement:** The richest man in the world is set to become a trillionaire. The SpaceX IPO represents a symbol of a market structure where public investors feed capital while oligarchic founders retain control and capture the upside. The exploitation of index-fund mechanics through a thin public float and forced buying by passive fund allow upward valuation regardless of fundamentals. And there’s also the huge elephant in the room of Musk’s openly racist/populist ideologies, of which he has an endless sum of money to fund and promote.
eloquentboot on
This article seems to suggest that index funds distort capital allocation because they will have to sell some equities to buy SpaceX shares and that has nothing to do with the value of SpaceX, but that isn’t correct. This article acts like SPY is required to buy these shares, but the managers of these index funds are allocating capital based on performance expectations.
herosavestheday on
The Bulwark is doing late stage capitalism takes now? Great fuck how the mighty have fallen.
The_Keg on
Ignore anyone using the term “late state capitalism”
affnn on
I think the dual-class share thing they highlight is actually a bigger problem than the index funds. Buying stock should get you a say in how a company is run. I wonder if that sort of corporate governance structure could be made illegal.
5 Comments
**Submission Statement:** The richest man in the world is set to become a trillionaire. The SpaceX IPO represents a symbol of a market structure where public investors feed capital while oligarchic founders retain control and capture the upside. The exploitation of index-fund mechanics through a thin public float and forced buying by passive fund allow upward valuation regardless of fundamentals. And there’s also the huge elephant in the room of Musk’s openly racist/populist ideologies, of which he has an endless sum of money to fund and promote.
This article seems to suggest that index funds distort capital allocation because they will have to sell some equities to buy SpaceX shares and that has nothing to do with the value of SpaceX, but that isn’t correct. This article acts like SPY is required to buy these shares, but the managers of these index funds are allocating capital based on performance expectations.
The Bulwark is doing late stage capitalism takes now? Great fuck how the mighty have fallen.
Ignore anyone using the term “late state capitalism”
I think the dual-class share thing they highlight is actually a bigger problem than the index funds. Buying stock should get you a say in how a company is run. I wonder if that sort of corporate governance structure could be made illegal.