X-Message-Number: 11372
Date: Fri, 05 Mar 1999 15:41:05 +0100
From: (John de Rivaz)
Subject: Re: Risk and Investment
In article: <> Paul Wakfer
<> writes:
> If there is any "elite group" of 21CM shareholders, it is those that
> had the morality, the rationality, and the courage to risk major
> portions of their assets (for some, *the* major portion) for the purpose
> of increasing their chances for extended life and with little or no
> concern for financial gain. Yes, those people truly constitute an "elite
> group" and if anyone in cryonics is ever to acheive financial gain, I
> cannot imagine a group more worthy. Mr Shelton's whining remark to Saul
> Kent is but the constant refrain of the timid, shortsighted, and
> irrationally selfish: "Now that it is clear that the business is
> succeeding, please let me invest at the same price as those who took the
> risk which made it succeed." By what right, or any other measure of
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
> justice, do you believe that you should be able to do this? You were not
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
> a pledger to the Prometheus Project, not even a vocal supporter. You did
> not donate to INC. You have done *nothing* to help the present turn of
> events come to pass!
>
I feel that these sentiments so forcefully expressed are better dealth with
by logic, rather than anger, without bringing in fuzzy ideas such as "right"
or "justice". It appears the problem is that Mr S fails to understand the
basic principles of investment. The reason why shares are cheaper when they
are new and unproven is because the risk is greater. Once the risk reduces,
the price goes up.
The whole matter of investment is driven by risk and reward for taking risk.
Without that reward, there would be no stock market. Without a stock market,
few if any new ideas would ever get funding. Having a good idea and then
slagging off everyone who won't give you money for it (aka solialism) is no
substitute for a properly run stock market which drives money into the hands
of those whose innovation excells the rest.
I suppose there may a reason to grumble that you have to invest a large sum
in order to get some shares in a new venture before they are on sale in a
public stock market. But there is nothing immoral or unjust in that - the
vendors of the shares have every right to offer them on whatever terms they
like. It is up to the investor as to whether to accept or not. If for every
10 investors they instead got 100 with 1/10 of the shares, the
administration costs would go up.
I would also make the following point as well. Almost everyone signed up for
cryonics hopes to offer a bit more than the barest minimum for their
suspension fees. That extra sum usually comes from a remainder of their
estate. Therefore if they invest recklessly, then this remainder is what is
going to be hit. Investing half or all of one's entire assetts in one
company is reckless investing. I do not think people should be castigated
for not investing an appreciable proportion of their assetts in one company,
however worthy it is. (It is rather different if a company that made up say
1/20 of your assetts grows faster than the others and becomes an appreciable
proportion - it has self selected for excellence.)
--
Sincerely, John de Rivaz
Homepage: http://ourworld.compuserve.com/homepages/JohndeR
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