This is essentially the management of pent-up demand.
The theory is that without the formation of capital, and its conservation by means of “natural monopolies,” we don’t have the latest version of the i-phone and a new i-watch on the wrist.
No, that’s not it.
We have so-called “natural monopolies” now. These bastions of consolidated wealth and power are financed from the top down, utilizing the surplus (the capital) to attain ROE, “intending” to the point of default (at zero marginal cost). These bastions of big, proprietary risk, manage “the risk” for all of us in the aggregate dimension where the social contract, and its conforming terms, are all but deceased. They “intend” (by “building out the network” or “bringing ‘things’ to scale”) the capacity for unchallenged pricing power (forming the “ecosystem” of an organized psychopathy). The ecology of the system (the logic of structural incentives, like programming a computer, or say, an i-phone) conforms to the model (the method yield) of consolidated (integral-operant) power. The model intends risk that would otherwise modify behavior (applying risk-value from the bottom up, on demand) to exist at the top by default.
Conditionally operant (commonly collaborative) from the top down, the self-determined parts conform to the whole, systematically “built out” to meet demand, on demand, from the top down, yielding to the narcissism (the synergy) of an aristocratic identity. The “natural” result of this natural intendency (the “natural identity” Objectivists describe as being our default condition) is accumulative debt, by design, and liquidity crises. It is a circle that has been squared, again, and again, and again, without, apparently, any incentive to change what’s wrong with it because, for heaven’s sake, it’s intentionally built-out, being TOO BIG to fail with economy of scale!
Yes, the medium is the message. The i-phone pluralizes common experience…”it’s the plurality stupid!”…the singular propriety of common divisibility…that makes for the strength–the virtue–of an on-demand existence, both politically and economically.
Managing the surplus of pent-up demand, the great, common denominator of a consolidated, managed existence–the Fed–says that TBTF banks (five of which own nearly half of all banking assets) are prone to failure. They are still too big to fail, so the Fed is increasing their capital requirements to remain liquid when crises occur by default.
(I could spell it out for you…the value of being naturally bigger–adding to capital reserves in order to show the aversion to being risk prone–admits an organized psychopathy…but I think we’re all smart enough to figure it out.)
Being prone to the aversion is not an identity that naturally monopolizes the risk.
Whether it’s Apple or Bank of America, the cure for being too big to fail is being TOO BIG to fail, isn’t it?
(I’m confused…is being “too big” the problem, or is being prone to failure the problem? Are these attributes–and all manner of affairs both foreign and domestic–really disconnected?)
Being too big–consolidating risk in the form of “natural monopolies” to yield a surplus–is prone to failure.