So, Nvidia are backstopping $100B for the Ohio project, yet at the same time OpenAI are developing their Jalapeño processor, which will mean it will no longer need Nvidia GPUs for inference. That does not really make any sense to me.
Mcdonald's famously invested in Chipotle as a risk mitigation strategy. If consumers want healthier fast food, sales at Mcdonald's will go down, and sales at Chipotle will go up. Investing in something anti-correlated with your business lowers risk by paying you when your own business is hurt by a surprise.
If you can see the future, by all means invest in the one stock that will go up the most. If you can't see the future, diversifying into assets that have negative correlation (one goes up if the other goes down) lowers volatility at the cost of limiting possible upside.
Nvidia has a massive pile of money. Where should they invest? If they believe in what OpenAI is doing, investing in it makes sense no matter what hardware OpenAI chooses. If OpenAI manages to make something much better than Nvidia hardware, Nvidia's sales will go down as the value of OpenAI goes (way) up. If OpenAI fails to make something as good as Nvidia hardware, they buy Nvidia hardware.
It is odd how internet commentators seem to think that companies make investment decisions as a way to root for a team. They do not. That is not how finance professionals think!
If you have extra cash and cannot spend it on your own business, you can just pay dividends to the shareholders. The shareholders are free to invest in competing businesses (or not, if they want a pure play without hedging). Turning the business into a hedge fund with the retained capital seems to primarily benefit insiders after a certain point.
> If you have extra cash and cannot spend it on your own business, you can just pay dividends to the shareholders.
That is an option. It is usually not the best option.
Dividends are taxed. You are forcing shareholders to pay a good chunk of money in taxes.
Suppose Nvidia decides not to hedge the risk that competing products eat into their margins. Some years they get lucky and are flush with revenue. Other years they have much lower revenue.
Even in bad years, they want to keep paying to make future products. Cutting employee pay or mass firings would break their engineering org. To avoid that, they would need enough cash on hand to survive several bad years. Now they can't pay dividends because they need this extra buffer of cash! Hedging is a better deal for everyone.
> The shareholders are free to invest in competing businesses.
OpenAI is not (yet) public. Most Nvidia shareholders can't choose to hedge risk by buying shares in OpenAI, or any similar company (they are all private or a small part of a bigger public business).
So either Nvidia is dangling a carrot in front of the Epstein people in the Trump admin (Trump, Lutnick, etc.) or it is in on it. I wonder where Wexner got the CoreWeave tip.
I have a theoretical question. At what point does capitalism become the other side of the coin from communism.
Like there's communism which is centralized planning and the state owning the means of production.
Then I think there's Adam Smiths ideal form of capitalism that I think can loosely be described as independent demand signals allocate resources throughout the economy.
What happens when a capital accumulates in a smaller pool of folks who choose how to allocate those resources. Silicon Valley isn't responding to demand, it's essentially centrally planning where to assign resources to create demand.
I have a theory that this issue happens because we put money into the stock market for our pension. This creates a concentration of wealth/money into a relatively few organizations. I think money and wealth should be created more locally.
Of course, this is very idealistic and simplistic.
However, what did people think was going to happen when the common wisdom is to put your money into an index and then shut up? It simply cannot be true that putting money into the index means you win. There's cost somewhere, a parasite on the system, that is going to come due at some point.
"....It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it."
- Adam Smith, final paragraph of Book I, An Inquiry into the Nature and Causes of the Wealth of Nations
Warning about companies being able to command regulation on themselves. We're far past anything Adam Smith would have thought was a good idea for how we organize capital and commerce.
A given company may or may not be organized this way.
IBM had a system of "blue dollars". If the server group sells a computer, it gets revenue ("green dollars", i.e. real money). The leaders of the server group are credited some fraction of the real money as "blue dollars", which they can give to teams that enabled their success. For example, if sales are being won based on a new feature of the XLC compiler, the server group leads would recognize them by sending their blue dollars to the XLC compiler team. Teams choose what to do (and whose problems to solve) to maximize the amount of blue dollars they can get. Promotions and pay go to people who drive blue dollar "revenue" for their team.
Why does IBM work this way? It is too big to be centrally planned: If the compiler team does amazing work, and the engineers get no credit, all the smart and hardworking engineers leave. The central planners in Armonk re-invented a market economy to figure out what work matters and reward it.
Yes its decentralised still. And the idea is that competition is the force that keep things in check - with shareholders interests taken care of with the focus of manager's being to optimise for whatever makes the owners better off.
At the extreme with 'AI' - there's no need for firms to exist.
'Power to the people' was always transitory - do you think the govt is dumb? Lets take a simple form of capital: cameras. Would cheap cameras exist without the private sector competing for shareholders interests? Probably not.
They aid and abet it. It benefits their own interests. This game goes on until the govt no longer see's the need for a private sector anymore.
The demand signals never allocated the resources, a small number of people always did. Those people react to the demand signals (and they still do).
IMO a more important question is: what happens when the market power of a segment of society grows much greater than the rest? In a "K-shaped" economy, the top 20% have so much spending power (and even more future spending power) than their demand signals can overwhelm the rest. Then IMO the market won't respond to the demand signals of the bottom 20% and capitalism stops working for all. Add to that the possibility of AI automating more and more work and you have a system that only works for folks at the tops.
This isn't a resource allocation problem! it's a purchasing power distribution problem.
This doesn’t strike me as a problem. There are sufficient entrepreneurs that market need common to a total 20% of the population will be met. In the USA that 70 million is a sufficiently large number. After all, that’s $700 million of MRR at $10/month.
The things limiting provision of services are physical limits like the audience being widely dispersed or just characteristics like not all sharing the same needs and therefore not actually being addressable.
You obviously are well aware that addressability does not track with income category automatically but it does for many businesses. E.g. payday loans, rent to own, check cashing, dollar stores.
Since a large section of this group is in use of government credits, at the least businesses will evolve to meet the use of those. EBT grocers, Medicaid-focused care, etc.
The majority of the effort will be spent where the greatest economic opportunity is, but entrepreneurs will match their ability to address the market to their audience. It’s not possible for a dollar store to sell GPUs to Baseten. They don’t have the capability to do something useful there.
You can do a lot of central planning if you can convince investors to give you a large enough pile of money, but it still doesn't compare to what the US government can do. You're not going to fund social security that way.
> What happens when a capital accumulates in a smaller pool of folks who choose how to allocate those resources.
> Silicon Valley isn't responding to demand, it's essentially centrally planning where to assign resources to create demand.
Silicon Valley is not centrally planned. The people at Microsoft did not go to a committee and ask the people who ran Sun Microsystems if it would be okay to release Windows NT. They mailed the CEO of Sun a coffin (1).
> Then I think there's Adam Smith's ideal form of capitalism
People have this idea that Adam Smith "idealized" capitalism or that the Wealth of Nations is some sort of manifesto. It's much more of an empirical research (by the standards of the time) with observations and findings. It's equally useful if you're a communist or a free-market capitalist.
Adam Smith himself was fairly skeptical of massive corporations capital accumulation:
> "The directors of such companies, however, being the managers rather of other people's money than of their own, it cannot well be expected that they should watch over it with the same anxious vigilance with which the partners in a private copartnery frequently watch over their own. Like the stewards of a rich man, they are apt to consider attention to small matters as not for their master's honour, and very easily give themselves a dispensation from having it. Negligence and profusion, therefore, must always prevail, more or less, in the management of the affairs of such a company."
That doesn’t sound right. Silicon Valley is clearly responding to massive demand for AI services. The reason Nvidia has so much money is that people are paying them for something only they can make. It’s not like they’re issuing stock into a meme stock spike or something. They’re selling hardware that companies are demanding in large quantities because those companies need the hardware to provide services that people and companies want so badly that every marginal hardware dollar spent earns a large number of service dollars.
This is probably the most demand-mediated response of all time. The natural form of that is that the guy who we give lots of money to for his stuff is going to have lots to spend.
To what extent is it organic demand rather than manufactured demand? Clearly there's some demand for AI use but a lot of it has been shoved down people's throats with usage quotas, pushing it into every webpage and application, etc. To me it seems like there is a large degree of central dictate to use it pushed, at some level, by the perceived need to invest in it faster than China.
> Silicon Valley is clearly responding to massive demand for AI services > to provide services that people and companies want so badly
Not at all. In economics, demand has little to do with "wants", it means paying the price to buy the service. In that light, there isn't much demand for AI because the companies providing it are losing huge sums of money to subsidize underpriced and mostly free services.
The AI "demand" is now paid for by circular deals and huge debts incurred for the sake of centrally planned subsides - in confirmation of the comment you're trying to refute.
> They’re selling hardware that companies are demanding in large quantities because those companies need the hardware
Those companies don't need the hardware for funded demand (which isn't there), they need it to scalp the hardware market by hoarding and centralizing compute, while suppressing possible competitors - another centrally planned activity lacking any wider economic benefits.
PS. There's another big mistake in this expression "hardware that companies are demanding in large quantities" - the demands increase the price but they don't increase the quantity, because all relevant fabs are running at full capacity, they literally cannot provide more.
That is the entire Marx's Das Kapital. The main argument being free market will lead to concentration of power and then capitalism collaspe. He expanded on what he thought the not-capitalism could be.
Then Lenin concluded that if you will always have concentration of power and some folks doing centralized planning, it might well be the state.
And ever since that and the supposedly marginalist “revolution” people keep pretending their sliced up tautological economics is a science separated from politics because it’s convenient to those who wield capital. Truth is Marx might’ve not made the best case for the general law of profit equalization and presented the transformation of value to price in the best of mathematical terms, but I’ll be damned if the empirical evidence makes up for everything he missed.
Marx was extremely simple minded when it came to human nature. That’s the problem with all utopian ideas and all idealistic philosophers and economists: the assumption is always that humans will behave in some idealised way. While in reality greed, cruelty, corruption, treating other humans as inhuman or slaves is part of human nature. Not the only part of course, but probably the most important part when looking at the very long list of disaster we call history.
Crazy how historically wrong Das Kapital is as a book. The labor theory of value has done enormous amounts of damage to humans world-wide with its lies. Watching Marx turn himself into pretzels to explain how to calculate the "Socially necessary labor time" is entertaining if it didn't have the baggage of motivating dozens of horrible, no good revolutions, useless, damaging revolutions.
Until we have true AGI there is no value without labor. The shares of Amazon that make Bezos so rich would be worthless without the 1.5 million people working for it.
That's certainly an opinion... Quite a lot of condemnation for no real argument. I personally think surplus value and socially necessary labor time are quite straightforward, intuitive concepts. Meanwhile, I found this tidbit on Henry George's wikipedia page: "Upon Marx's death, George admitted he has not read any of his works, which were untranslated into English at the time,"
For anyone interested in reading more from Marx's side, Wage Labour And Capital by Marx is a pamphlet meant for mass distribution and not a difficult read. I've heard A People's Guide To Capitalism recommended as a high quality modernized version of the same ideas.
There are old words for this: Monopolies and Trusts. The US around this point last century put a lot of work in Trust-Busting and Anti-Monopoly/Anti-Corruption work.
The other related word is Oligarchy, rule by a select few that think they know better than everyone else. Oligarchy seems to be a failure case of most modes of politics and economics. Capitalism and communism both fail over to oligarchy when left unchecked.
It's been argued that for as many centuries as humanity spent under feudalism that oligarchy is almost the "default state" of politics and economics and it takes great effort to avoid it. Adam Smith saw economic monopolies and knew they were a failure case of capitalism from early on. Capitalism was built on top of breaking apart monopolies like the East India Trading Company. We've always known that capitalism is just as likely to slip into oligarchy as any other "ideal" form of resource allocation/economics, especially because it started as oligarchy.
This observation is exactly the Marxist prediction of how capitalism gradually transforms society from early capitalism, which nearly fit the Econ 101 assumptions of many small producers and consumers and such, into something that operates economically more like communism by being centrally planned, but with the severe drawbacks of a minority ruling class and being run undemocratically on the basis of private profit not usefulness to people. This is an interesting book on the subject of how far we have come in this regard: https://en.wikipedia.org/wiki/The_People%27s_Republic_of_Wal...
Which is what the European Socialists have been calling "Late Capitalism" since I think the 60's about the period from the 30's onwards.
The problem is it's not easy to have an actual debate on this since to some folks questioning whether capitalism or this form of capitalism is serving societies needs rapidly gets you lumped in with the "communists".
At some point though it becomes impossible to hide that the Emperor does in fact have all the clothes and everyone else is naked by comparison.
Capitalism has long since embedded itself as a cult of money, which is why it makes debates around it so difficult because people believe they are the Golden Child simply disenfranchised by people refusing to let Capitalism grace them. It's evolved from the 'temporarily embarrassed billionaire' part to just outright worship of billionaires though.
Unfortunately I think by the time people recognize the emperor having no clothes it'll be too late and we'll all suffer for it.
That's why you need a two-axis scale, not just a line with capitalism at one and and communism at the other. Same with politics, physically Hitler and Stalin ran a pretty similar form of government even though logically one was at the far right of the scale and the other at the far left.
The same group of minds that were behind communism were also behind modern capitalism. It's no surprise that these systems produce the same net results - it was by design.
So, Nvidia are backstopping $100B for the Ohio project, yet at the same time OpenAI are developing their Jalapeño processor, which will mean it will no longer need Nvidia GPUs for inference. That does not really make any sense to me.
Mcdonald's famously invested in Chipotle as a risk mitigation strategy. If consumers want healthier fast food, sales at Mcdonald's will go down, and sales at Chipotle will go up. Investing in something anti-correlated with your business lowers risk by paying you when your own business is hurt by a surprise.
If you can see the future, by all means invest in the one stock that will go up the most. If you can't see the future, diversifying into assets that have negative correlation (one goes up if the other goes down) lowers volatility at the cost of limiting possible upside.
Nvidia has a massive pile of money. Where should they invest? If they believe in what OpenAI is doing, investing in it makes sense no matter what hardware OpenAI chooses. If OpenAI manages to make something much better than Nvidia hardware, Nvidia's sales will go down as the value of OpenAI goes (way) up. If OpenAI fails to make something as good as Nvidia hardware, they buy Nvidia hardware.
It is odd how internet commentators seem to think that companies make investment decisions as a way to root for a team. They do not. That is not how finance professionals think!
If you have extra cash and cannot spend it on your own business, you can just pay dividends to the shareholders. The shareholders are free to invest in competing businesses (or not, if they want a pure play without hedging). Turning the business into a hedge fund with the retained capital seems to primarily benefit insiders after a certain point.
> If you have extra cash and cannot spend it on your own business, you can just pay dividends to the shareholders.
That is an option. It is usually not the best option.
Dividends are taxed. You are forcing shareholders to pay a good chunk of money in taxes.
Suppose Nvidia decides not to hedge the risk that competing products eat into their margins. Some years they get lucky and are flush with revenue. Other years they have much lower revenue.
Even in bad years, they want to keep paying to make future products. Cutting employee pay or mass firings would break their engineering org. To avoid that, they would need enough cash on hand to survive several bad years. Now they can't pay dividends because they need this extra buffer of cash! Hedging is a better deal for everyone.
> The shareholders are free to invest in competing businesses.
OpenAI is not (yet) public. Most Nvidia shareholders can't choose to hedge risk by buying shares in OpenAI, or any similar company (they are all private or a small part of a bigger public business).
[dead]
Even if Jalapeño is successful it will probably take multiple generations until it’s competitive.
The first version is already beating Rubin in the benchmarks, according to SemiAnalysis
Ohio billionaire Les Wexner (yes, that Wexner) had an early investment in CoreWeave.
https://www.forbes.com/sites/iainmartin/2024/08/06/how-victo...
Data centers are being built on his land in New Albany:
https://www.wsj.com/tech/ohio-intel-chipmaking-investment-st...
So either Nvidia is dangling a carrot in front of the Epstein people in the Trump admin (Trump, Lutnick, etc.) or it is in on it. I wonder where Wexner got the CoreWeave tip.
He is baaaack:
"Nvidia is running on borrowed time" - https://youtu.be/k44OmbYqLzk
Archieve link: http://archive.today/98KYg
Can anyone explain how Nvidia is not shaping up to the modern GE? This plus it's recent entry into making a PAC does not bode well
I have a theoretical question. At what point does capitalism become the other side of the coin from communism.
Like there's communism which is centralized planning and the state owning the means of production.
Then I think there's Adam Smiths ideal form of capitalism that I think can loosely be described as independent demand signals allocate resources throughout the economy.
What happens when a capital accumulates in a smaller pool of folks who choose how to allocate those resources. Silicon Valley isn't responding to demand, it's essentially centrally planning where to assign resources to create demand.
I have a theory that this issue happens because we put money into the stock market for our pension. This creates a concentration of wealth/money into a relatively few organizations. I think money and wealth should be created more locally.
Of course, this is very idealistic and simplistic.
However, what did people think was going to happen when the common wisdom is to put your money into an index and then shut up? It simply cannot be true that putting money into the index means you win. There's cost somewhere, a parasite on the system, that is going to come due at some point.
There are still active investors who decide which investments are good. The passive investors follow, for better or worse.
I am sure they invest well, but they don't invest locally. So most of the economy is choked by the few.
"....It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it." - Adam Smith, final paragraph of Book I, An Inquiry into the Nature and Causes of the Wealth of Nations
Warning about companies being able to command regulation on themselves. We're far past anything Adam Smith would have thought was a good idea for how we organize capital and commerce.
Fun fact: Internally all corporations are organized by central planning
A given company may or may not be organized this way.
IBM had a system of "blue dollars". If the server group sells a computer, it gets revenue ("green dollars", i.e. real money). The leaders of the server group are credited some fraction of the real money as "blue dollars", which they can give to teams that enabled their success. For example, if sales are being won based on a new feature of the XLC compiler, the server group leads would recognize them by sending their blue dollars to the XLC compiler team. Teams choose what to do (and whose problems to solve) to maximize the amount of blue dollars they can get. Promotions and pay go to people who drive blue dollar "revenue" for their team.
Why does IBM work this way? It is too big to be centrally planned: If the compiler team does amazing work, and the engineers get no credit, all the smart and hardworking engineers leave. The central planners in Armonk re-invented a market economy to figure out what work matters and reward it.
Yes its decentralised still. And the idea is that competition is the force that keep things in check - with shareholders interests taken care of with the focus of manager's being to optimise for whatever makes the owners better off.
At the extreme with 'AI' - there's no need for firms to exist.
'Power to the people' was always transitory - do you think the govt is dumb? Lets take a simple form of capital: cameras. Would cheap cameras exist without the private sector competing for shareholders interests? Probably not.
They aid and abet it. It benefits their own interests. This game goes on until the govt no longer see's the need for a private sector anymore.
Not at all. High level objectives from above are transformed and interpreted and subdivided by lower levels into actual planning and execution.
Also, a corporation is infinitely more simple to manage than a whole country.
The demand signals never allocated the resources, a small number of people always did. Those people react to the demand signals (and they still do).
IMO a more important question is: what happens when the market power of a segment of society grows much greater than the rest? In a "K-shaped" economy, the top 20% have so much spending power (and even more future spending power) than their demand signals can overwhelm the rest. Then IMO the market won't respond to the demand signals of the bottom 20% and capitalism stops working for all. Add to that the possibility of AI automating more and more work and you have a system that only works for folks at the tops.
This isn't a resource allocation problem! it's a purchasing power distribution problem.
This doesn’t strike me as a problem. There are sufficient entrepreneurs that market need common to a total 20% of the population will be met. In the USA that 70 million is a sufficiently large number. After all, that’s $700 million of MRR at $10/month.
The things limiting provision of services are physical limits like the audience being widely dispersed or just characteristics like not all sharing the same needs and therefore not actually being addressable.
You obviously are well aware that addressability does not track with income category automatically but it does for many businesses. E.g. payday loans, rent to own, check cashing, dollar stores.
Since a large section of this group is in use of government credits, at the least businesses will evolve to meet the use of those. EBT grocers, Medicaid-focused care, etc.
The majority of the effort will be spent where the greatest economic opportunity is, but entrepreneurs will match their ability to address the market to their audience. It’s not possible for a dollar store to sell GPUs to Baseten. They don’t have the capability to do something useful there.
Demand doesnt allocate resources... price and expected economic profit does.
Thats literally how the whole economic system functions.
If you in the top part of the K, this is a feature not a problem.
You can do a lot of central planning if you can convince investors to give you a large enough pile of money, but it still doesn't compare to what the US government can do. You're not going to fund social security that way.
> What happens when a capital accumulates in a smaller pool of folks who choose how to allocate those resources. > Silicon Valley isn't responding to demand, it's essentially centrally planning where to assign resources to create demand.
Silicon Valley is not centrally planned. The people at Microsoft did not go to a committee and ask the people who ran Sun Microsystems if it would be okay to release Windows NT. They mailed the CEO of Sun a coffin (1).
1. https://www.pcgamer.com/software/windows/the-team-behind-win...
That happened over 30 years ago. It was a different culture back then, with a lot fewer billionaires with cozy connections with the government.
> Then I think there's Adam Smith's ideal form of capitalism
People have this idea that Adam Smith "idealized" capitalism or that the Wealth of Nations is some sort of manifesto. It's much more of an empirical research (by the standards of the time) with observations and findings. It's equally useful if you're a communist or a free-market capitalist.
Adam Smith himself was fairly skeptical of massive corporations capital accumulation:
> "The directors of such companies, however, being the managers rather of other people's money than of their own, it cannot well be expected that they should watch over it with the same anxious vigilance with which the partners in a private copartnery frequently watch over their own. Like the stewards of a rich man, they are apt to consider attention to small matters as not for their master's honour, and very easily give themselves a dispensation from having it. Negligence and profusion, therefore, must always prevail, more or less, in the management of the affairs of such a company."
That doesn’t sound right. Silicon Valley is clearly responding to massive demand for AI services. The reason Nvidia has so much money is that people are paying them for something only they can make. It’s not like they’re issuing stock into a meme stock spike or something. They’re selling hardware that companies are demanding in large quantities because those companies need the hardware to provide services that people and companies want so badly that every marginal hardware dollar spent earns a large number of service dollars.
This is probably the most demand-mediated response of all time. The natural form of that is that the guy who we give lots of money to for his stuff is going to have lots to spend.
To what extent is it organic demand rather than manufactured demand? Clearly there's some demand for AI use but a lot of it has been shoved down people's throats with usage quotas, pushing it into every webpage and application, etc. To me it seems like there is a large degree of central dictate to use it pushed, at some level, by the perceived need to invest in it faster than China.
The usage quotas seem like a one- or two- quarter phenomenon at particular mismanaged organizations?
> Silicon Valley is clearly responding to massive demand for AI services > to provide services that people and companies want so badly
Not at all. In economics, demand has little to do with "wants", it means paying the price to buy the service. In that light, there isn't much demand for AI because the companies providing it are losing huge sums of money to subsidize underpriced and mostly free services.
The AI "demand" is now paid for by circular deals and huge debts incurred for the sake of centrally planned subsides - in confirmation of the comment you're trying to refute.
> They’re selling hardware that companies are demanding in large quantities because those companies need the hardware
Those companies don't need the hardware for funded demand (which isn't there), they need it to scalp the hardware market by hoarding and centralizing compute, while suppressing possible competitors - another centrally planned activity lacking any wider economic benefits.
PS. There's another big mistake in this expression "hardware that companies are demanding in large quantities" - the demands increase the price but they don't increase the quantity, because all relevant fabs are running at full capacity, they literally cannot provide more.
They are borrowing a lot and need to hype to absurd ways to create demand. It is forced on things rather then demanded.
That is the entire Marx's Das Kapital. The main argument being free market will lead to concentration of power and then capitalism collaspe. He expanded on what he thought the not-capitalism could be.
Then Lenin concluded that if you will always have concentration of power and some folks doing centralized planning, it might well be the state.
"Then Lenin concluded that if you will always have concentration of power and some folks doing centralized planning, it might well be the state."
This is exactly where things are heading.
Theres no need for firms anymore at the extreme - the govt can own all.
And ever since that and the supposedly marginalist “revolution” people keep pretending their sliced up tautological economics is a science separated from politics because it’s convenient to those who wield capital. Truth is Marx might’ve not made the best case for the general law of profit equalization and presented the transformation of value to price in the best of mathematical terms, but I’ll be damned if the empirical evidence makes up for everything he missed.
Marx was extremely simple minded when it came to human nature. That’s the problem with all utopian ideas and all idealistic philosophers and economists: the assumption is always that humans will behave in some idealised way. While in reality greed, cruelty, corruption, treating other humans as inhuman or slaves is part of human nature. Not the only part of course, but probably the most important part when looking at the very long list of disaster we call history.
Crazy how historically wrong Das Kapital is as a book. The labor theory of value has done enormous amounts of damage to humans world-wide with its lies. Watching Marx turn himself into pretzels to explain how to calculate the "Socially necessary labor time" is entertaining if it didn't have the baggage of motivating dozens of horrible, no good revolutions, useless, damaging revolutions.
If you want a good starting point book for an alternative to traditional capitalism and with a focus on the commons with none of this baggage, I highly recommend Henry George (https://en.wikipedia.org/wiki/Henry_George) and "Progress and Poverty" (https://en.wikipedia.org/wiki/Progress_and_Poverty) as it is a head-and-shoulders better read.
Until we have true AGI there is no value without labor. The shares of Amazon that make Bezos so rich would be worthless without the 1.5 million people working for it.
That's certainly an opinion... Quite a lot of condemnation for no real argument. I personally think surplus value and socially necessary labor time are quite straightforward, intuitive concepts. Meanwhile, I found this tidbit on Henry George's wikipedia page: "Upon Marx's death, George admitted he has not read any of his works, which were untranslated into English at the time,"
For anyone interested in reading more from Marx's side, Wage Labour And Capital by Marx is a pamphlet meant for mass distribution and not a difficult read. I've heard A People's Guide To Capitalism recommended as a high quality modernized version of the same ideas.
The word you’re looking for, is Serfdom.
There are old words for this: Monopolies and Trusts. The US around this point last century put a lot of work in Trust-Busting and Anti-Monopoly/Anti-Corruption work.
The other related word is Oligarchy, rule by a select few that think they know better than everyone else. Oligarchy seems to be a failure case of most modes of politics and economics. Capitalism and communism both fail over to oligarchy when left unchecked.
It's been argued that for as many centuries as humanity spent under feudalism that oligarchy is almost the "default state" of politics and economics and it takes great effort to avoid it. Adam Smith saw economic monopolies and knew they were a failure case of capitalism from early on. Capitalism was built on top of breaking apart monopolies like the East India Trading Company. We've always known that capitalism is just as likely to slip into oligarchy as any other "ideal" form of resource allocation/economics, especially because it started as oligarchy.
This observation is exactly the Marxist prediction of how capitalism gradually transforms society from early capitalism, which nearly fit the Econ 101 assumptions of many small producers and consumers and such, into something that operates economically more like communism by being centrally planned, but with the severe drawbacks of a minority ruling class and being run undemocratically on the basis of private profit not usefulness to people. This is an interesting book on the subject of how far we have come in this regard: https://en.wikipedia.org/wiki/The_People%27s_Republic_of_Wal...
Which is what the European Socialists have been calling "Late Capitalism" since I think the 60's about the period from the 30's onwards.
The problem is it's not easy to have an actual debate on this since to some folks questioning whether capitalism or this form of capitalism is serving societies needs rapidly gets you lumped in with the "communists".
At some point though it becomes impossible to hide that the Emperor does in fact have all the clothes and everyone else is naked by comparison.
Capitalism has long since embedded itself as a cult of money, which is why it makes debates around it so difficult because people believe they are the Golden Child simply disenfranchised by people refusing to let Capitalism grace them. It's evolved from the 'temporarily embarrassed billionaire' part to just outright worship of billionaires though.
Unfortunately I think by the time people recognize the emperor having no clothes it'll be too late and we'll all suffer for it.
That's why you need a two-axis scale, not just a line with capitalism at one and and communism at the other. Same with politics, physically Hitler and Stalin ran a pretty similar form of government even though logically one was at the far right of the scale and the other at the far left.
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The same group of minds that were behind communism were also behind modern capitalism. It's no surprise that these systems produce the same net results - it was by design.
Last time this happened Alan Greenspan called it irrational exuberance on TV, then we all lost our life savings...
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Hey guys we're trillionaires now too btw