Russia, Ukraine and the West

[Carlin]

Wagner captures Krasnaya Gora.

Telegram channels associated with PMCs report that no one from the Krasnaya Gora garrison of the Armed Forces of Ukraine was left alive.

[Carlin]

Slavyangrad Telegram channel:


American media coverage of the conflict in Ukraine is not accurate, according to American journalist Seymour Hersh.

"The coverage of the conflict in Ukraine by leading American media, for example, The New York Times and The Washington Post, does not correspond to what is really happening," investigative journalist Hersh said on the air of the War Nerd podcast.

Hersh did not specify what he meant, but when asked by the host if his words meant that the conflict is not developing as well for Kiev as the American media are trying to portray, he answered in the affirmative.

"Russia has more than 350,000 regular servicemen who are not even involved in the conflict," he said.

[Vangelovski]

Hersh did not specify what he meant

Compelling stuff. As long as he gave a wink and a nod we can rest assured he knows stuff...

Interview with two former Wagner Group fighters:

The two fighters told of hideous losses in “first wave” assaults reminiscent of World War I charges.

“There were 90 of us. Sixty died in that first assault, killed by mortar fire. A handful remained wounded,” said one, recalling his first assault near the village of Bilohorivka. “If one group is unsuccessful, another is sent right away. If the second one is unsuccessful, they send another group.”

https://edition.cnn.com/2023/02/12/e...ntl/index.html

The Russians have never moved on from WWI tactics, but at least during the first world war a "wave" of men consisted of tens of thousands. Now it seems it consists of about 90. Maybe if they tried sending in a few more at a time they'd have a better chance of overwhelming Ukrainian defences...but it's not what you know, it's who you know that puts you in charge.

“We couldn’t retreat without orders because if we don’t comply with the order, we will be killed,” said one of the prisoners...“Our commander was told that if anyone gets cold feet, he would have to be eliminated. And if we failed to eliminate him, we would be eliminated for failing to eliminate him.”

https://edition.cnn.com/2023/02/12/e...ntl/index.html

This has been standard practice since Trotsky first instituted it during the Russian Revolution. They seem to think they have an infinite supply of men (fit for military service and combat ready). They don't.

[Risto the Great]

What do you mean by "deferring". That's pretty vague.

It’s not terribly vague when read in conjunction with the twitter link I provided. Didn’t you see it? The one where the USA corporations will effectively take over the country. Let’s not kid ourselves, they already have. I’m going to assume you will deny the Biden/Kolomoiski/Burisma relationship in among all of this as well. Ukraine will do precisely what factions within USA wants because it is largely owned by USA now. That is what I mean about “deferring”.

Did you see the wink and nod from the demented Biden about Nordstream? USA did that and has condemned Europe to a brand new kind of subservience. Masterful stuff. Ukraine is just a pawn it USA strategy. Tell me about self-determination again.

[Risto the Great]

Documents captured from retreating Russians last year demonstrate that Putin wanted the total collapse of Ukraine within weeks, if not days.

I never saw them. I would love to see what you are relying on as factual here. Was it a retreating Russian who was carrying an offical letter saying “kill them all”? Do you have a link?

Don’t you think Russia could have done a USA vs Serbia thing and destroyed all of Ukraine’s infrastructure within a relatively short period of time? I reckon it could have knocked out some serious infrastructure very quickly if it wanted to.

[Vangelovski]

It’s not terribly vague when read in conjunction with the twitter link I provided. Didn’t you see it? The one where the USA corporations will effectively take over the country. Let’s not kid ourselves, they already have. I’m going to assume you will deny the Biden/Kolomoiski/Burisma relationship in among all of this as well. Ukraine will do precisely what factions within USA wants because it is largely owned by USA now. That is what I mean about “deferring”.

Please, you have no idea how government works. There is a myriad of competing interests ranging from single-issue grassroots activists all the way through to your big scary corporations. Even the Jews

That's how it's supposed to be. It shows that the breadth of issues across the community are being represented and debated within government. Your current obsession with corporations taking over the world is plain ludicrous. Name one government that is controlled solely by corporations. Which corporations are involved? Which individuals? How exactly are these corporations controlling this government? which laws, regulations, policies or funds are they controlling? Which government officials (elected and bureaucratic) have been corrupted? What evidence do you actually have other than vacuous, wild speculation?

Did you see the wink and nod from the demented Biden about Nordstream? USA did that and has condemned Europe to a brand new kind of subservience. Masterful stuff. Ukraine is just a pawn it USA strategy. Tell me about self-determination again.

Again, wildly idiotic speculation. What evidence do you have other than that Balkan conspiracy you heard?

[Vangelovski]

I never saw them.

You would have if you read that NY Times article I shared.

I would love to see what you are relying on as factual here. Was it a retreating Russian who was carrying an offical letter saying “kill them all”? Do you have a link?

It's pretty common knowledge, but its hard to find when your not looking and relying solely on the Russian Government owned RT News.

Even though you won't read them, here's some for the sake of anyone who's interested. A simple google search will reveal lots more.

https://news.sky.com/story/ukraine-war-captured-russian-documents-reveal-moscows-10-day-plan-to-take-over-the-country-and-kill-its-leaders-12759836

https://www.telegraph.co.uk/world-news/2022/12/02/captured-documents-reveal-russias-plan-annex-ukraine-ten-days/

https://www.hindustantimes.com/world-news/russiaukraine-war-this-was-vladimir-putin-s-pre-ukraine-invasion-plan-captured-documents-reveal-101669961567803.html

Don’t you think Russia could have done a USA vs Serbia thing and destroyed all of Ukraine’s infrastructure within a relatively short period of time? I reckon it could have knocked out some serious infrastructure very quickly if it wanted to.

I've made it pretty clear that I don't think Russia could have done that and one year on it should be clear to everyone that Russia does not have that capability. If it could, it would have, but it can't and hasn't. Russia has shown it has no qualms about destroying civilian infrastructure will little to no military value and is doing as much damage as it can with its North Korean artillery and Iranian drones.

[Carlin]

Reporter Seymour Hersh on "How America Took Out the Nord Stream Pipeline": Exclusive TV Interview

When the Nord Stream pipelines carrying natural gas from Russia to Germany were damaged last September, U.S. officials were quick to suggest Russia had bombed its own pipelines. But according to a new report by the legendary investigative journalist Seymour Hersh, it was the U.S. Navy that carried out the sabotage, with help from Norway. Citing a source "with direct knowledge of the operational planning," Hersh writes on his Substack blog that planning for the mission began in December of 2021. The White House and the Norwegian government have since denied the claims. Hersh joins us for an in-depth interview to discuss his report and says the U.S. decision to bomb the pipelines was meant to lock allies into support for Ukraine at a time when some were wavering. "The fear was Europe would walk away from the war," he says. Hersh won a Pulitzer Prize in 1970 for his reporting on the My Lai massacre. His reporting on CIA spying on antiwar activists during the Vietnam War era helped lead to the formation of the Church Committee, which led to major reforms of the intelligence community, and in 2004, he exposed the Abu Ghraib prisoner abuse scandal in Iraq.

https://www.youtube.com/watch?v=d4BuMaGlKp0

[Risto the Great]

https://www.hindustantimes.com/world...961567803.html

I went straight to the Hindustan times link. It’s where I typically get my best information from. Though, I must admit, I felt a little underwhelmed. Is this what you are relying upon:

A British defence and security think tank revealed details of Moscow's pre-invasion plan for Ukraine, based on captured Russian documents apparently signed off by Vladimir Putin.

Can I sell you a bridge?

I've made it pretty clear that I don't think Russia could have done that and one year on it should be clear to everyone that Russia does not have that capability. If it could, it would have, but it can't and hasn't. Russia has shown it has no qualms about destroying civilian infrastructure will little to no military value and is doing as much damage as it can with its North Korean artillery and Iranian drones.

I believe Russia knows it would be demonised if it were to attack randomly and indiscriminately instead of being seen to be a liberator for the oppressed Russian minority. But I rely on logic instead of the Hindustan times.

[Risto the Great]

Please, you have no idea how government works. There is a myriad of competing interests ranging from single-issue grassroots activists all the way through to your big scary corporations. Even the Jews

You didn’t even know how deeply embedded those evil corporations were with the UN until a few months ago. Do I need to get Bill Gates to personally administer his favourite cocktail of vaccines to you before you get it. I don’t understand how government works at all - I don’t wear cardigans to work.

That's how it's supposed to be. It shows that the breadth of issues across the community are being represented and debated within government. Your current obsession with corporations taking over the world is plain ludicrous. Name one government that is controlled solely by corporations. Which corporations are involved? Which individuals? How exactly are these corporations controlling this government? which laws, regulations, policies or funds are they controlling? Which government officials (elected and bureaucratic) have been corrupted? What evidence do you actually have other than vacuous, wild speculation?

I will give you one. After the GFC, the government wanted to make people feel safe with their banks. They guaranteed your first $250K in deposits should the bank go broke. In 2017, the IMF said “You bitches want a AAA credit rating? Then the banks gotta keep everyone’s money if they go broke y’all.” And, Lo and behold, legislation was passed in 2018 to ensure banks will keep your money and turn depositors into shareholders. The bank owes nothing to shareholders. Therefore the government will never need to bail out the $250K deposits.

I am gonna give you a little job now: Find me a single retard that voted for this and thought it was a great idea.

Tell me how democracy works again. Tell me how the IMF did NOT have more influence than you. Wait until you learn about what WEF is doing to democracies. You will blush.

Again, wildly idiotic speculation. What evidence do you have other than that Balkan conspiracy you heard?

To be fair, it’s not in Hindustan Times yet, but perhaps watch Carlin’s post above if you would like some context. It might break your heart though.

[Risto the Great]

You would have if you read that NY Times article I shared.

BTW Blackrock directly owns over 8% of NY Times. Indirectly is another issue.

[Vangelovski]

I went straight to the Hindustan times link. It’s where I typically get my best information from. Though, I must admit, I felt a little underwhelmed. Is this what you are relying upon:

Maybe you should have read the other ones too. Or did your own Google search. Here's some more (there's pictures in the Forbes one that might help you):

https://www.forbes.com/sites/sebastienroblin/2022/03/03/alleged-captured-documents-imply-ukraine-invasion-planned-in-january/?sh=4abd76c61b96

https://www.reuters.com/investigates/special-report/ukraine-crisis-russia-base/

Clearly you have no understanding of military operational plans. There are thousands of hours of work that goes into them. They include hundreds and sometimes thousands of pages of documents, maps, lists and photographs that are disseminated among the officer corps so that everyone knows what they need. This type of information is captured in battle all the time so its shocking that your so shockingly unaware of it. Read a book. A newspaper. A website. Anything.

But beyond the captured documents it was blatantly clear that Russia intended to take all of Ukraine in a blitz campaign when they simultaneously opened up three fronts (north, east and south) and headed directly for Kiev.

I believe Russia knows it would be demonised if it were to attack randomly and indiscriminately instead of being seen to be a liberator for the oppressed Russian minority. But I rely on logic instead of the Hindustan times.

Russia has been indiscriminately bombing Ukrainian civilians and infrastructure. Its a weekly occurrence. All over the news, which you clearly don't read/listen to because all news outlets are corporations...except of course for RT. Its Russian Government owned. Must be good. The point around the missiles is that the Russians simply don't have the capacity, as opposed to intent.

I will give you one. After the GFC, the government wanted to make people feel safe with their banks. They guaranteed your first $250K in deposits should the bank go broke. In 2017, the IMF said “You bitches want a AAA credit rating? Then the banks gotta keep everyone’s money if they go broke y’all.” And, Lo and behold, legislation was passed in 2018 to ensure banks will keep your money and turn depositors into shareholders. The bank owes nothing to shareholders. Therefore the government will never need to bail out the $250K deposits.

You've managed to say absolutely nothing here and provided a fake example. According to APRA's website, the Australian Government does cover the deposits of up to $250,000: https://www.apra.gov.au/financial-claims-scheme-0

But lets break it down further:

1. You failed to name a single corporation.

2. You made a socialist assumption that the government should guarantee bank deposits with taxpayer money. Why? When a person deposits their money into a bank, they are effectively making an investment by loaning that money and expecting a return (interest). There are no guarantees in life and anything can happen. Banks can and do go bankrupt and people who give them their money can and do lose it. It's a calculated risk.

3. When and how did the "the banks" supposedly get involved in changing this legislation (which was never actually changed)? Which ones exactly were involved? How does that even equate to "control" of government? Can you provide any evidence as opposed to hearsay, rumors and conjecture?

4. If by the IMF you mean the International Monetary Fund, that's not a corporation or a bank. It's an international organisation made up of member countries that provide emergency funds. There is no private profit involved.

5. Again, everything your saying is a complete load of crap. APRAs website says the complete opposite:

https://www.apra.gov.au/financial-claims-scheme-0

BTW Blackrock directly owns over 8% of NY Times. Indirectly is another issue.

So? What empty-headed drivel will you conclude with that? Who owns the other 92%? How many thousands of shareholders and institutional shareholdings own Blackrock, equating to millions of mum and dad investors? Who's controlling what exactly, how are they controlling it, and what evidence do you have?

[Risto the Great]

Maybe you should have read the other ones too. Or did your own Google search. Here's some more (there's pictures in the Forbes one that might help you):

https://www.forbes.com/sites/sebasti...h=4abd76c61b96

The Ukrainian military posted this on their Facebook page. Were there any dick pics? And it “seemingly” has a date stamped on it. Seriously, are you actually Forrest Gump pretending to be someone who knows what they are talking about?

https://www.reuters.com/investigates...s-russia-base/

Reuters did all the fact checking for Covid vaccines. They were pretty much wrong on every count. They are a captured organisation. I’m gonna assume you believe everything you read in your favourite journals. I’m even gonna assume you’re vaccinated.

You've managed to say absolutely nothing here and provided a fake example. According to APRA's website, the Australian Government does cover the deposits of up to $250,000: https://www.apra.gov.au/financial-claims-scheme-0

You, with your “forrestgumpian” comprehension skills didn’t understand the nuance of what I said. It is a common theme with you. I told you the government covers the deposits. I also told you it will never have to pay them because the mechanism to bail in the depositors money and convert them into shareholders will ensure banks never go broke. You don’t really have a head for business do you?

But lets break it down further:

1. You failed to name a single corporation.

2. You made a socialist assumption that the government should guarantee bank deposits with taxpayer money. Why? When a person deposits their money into a bank, they are effectively making an investment by loaning that money and expecting a return (interest). There are no guarantees in life and anything can happen. Banks can and do go bankrupt and people who give them their money can and do lose it. It's a calculated risk.

3. Why would "the banks" care if the government was guaranteeing bank deposits with its own (taxpayer money)? It's not "the banks" money. When and how did the "the banks" get involved in changing this legislation? Which ones exactly were involved? How does that even equate to "control" of government? Can you provide any evidence as opposed to hearsay, rumors and conjecture?

4. If by the IMF you mean the International Monetary Fund, that's not a corporation or a bank. It's an international organisation made up of member countries that provide emergency funds. There is no private profit involved.

5. Again, everything your saying is a complete load of crap. APRAs website says the complete opposite:

https://www.apra.gov.au/financial-claims-scheme-0

So? What empty-headed drivel will you conclude with that? Who owns the other 92%? How many thousands of shareholders and institutional shareholdings own Blackrock, equating to millions of mum and dad investors? Who's controlling what exactly, how are they controlling it, and what evidence do you have?

”A socialist assumption” coming from a government employee gives me infinite mirth. I never said it was right or wrong. I said it was effectively removed … wait for it … in favour of banking corporations. How do you like them peaches, Forrest?

In any case, you asked why the banks would care if the government guaranteed deposits. Well, Forrest, it’s like this. The banks just got a whole lot safer in Australia than anywhere else in the world. The shareholders loved the shit out of that and the shares increased in value. It’s pretty complicated stuff. Not as complicated as picking which cardigan to wear to work, but you will catch on one day.

You even think the IMF doesn’t run with agendas. You probably don’t even notice that suspect uncle who gives candy to the children but awkwardly pats them all on the arse too long.

You think a relatively small shareholding interest means nothing. Well Forrest, let me tell you something. I said 8% directly and suggested they owned more indirectly. 10% shareholding represents a substantial interest.

substantial shareholder means a person who is entitled to exercise, or to control the exercise of, 10% or more (or such other percentage as may be prescribed by the Listing Rules) of the voting power at any general meeting of the Company;

As an example: In the UK, At least 10%: right to call for a poll vote on a resolution. More than 10%: right to prevent a meeting being held on short notice (in private companies).

Harvard did a little piece on control. You see, Forrest, it’s like a box of chocolates. You never know each box is owned by Blackrock until you sound like an idiot with a yokel accent as you wave the American flag around shouting “democracy will prevail”.

https://hbr.org/2019/02/how-big-a-problem-is-it-that-a-few-shareholders-own-stock-in-so-many-competing-companies

How Big a Problem Is It That a Few Shareholders Own Stock in So Many Competing Companies?
by Jacob Greenspon
February 19, 2019, Updated February 22, 2019

Many critics claim that anti-trust enforcement has dangerously weakened since the 1980s, often citing the dominance of the tech giants as evidence of this. They argue that any benefit gained from Google’s free services or Amazon’s low prices is outweighed by their chokehold on suppliers, their possession of mountains of personal data, and more. Others have noted rising concentration outside of tech: two-thirds of U.S. industries became more concentrated between 1997 and 2012.

But a different form of monopoly has largely escaped the limelight. An emerging body of research alleges that trusts have returned in a more insidious form as ‘horizontal shareholdings’: investors that own significant shares in several competing firms. For example, there is substantial common ownership among U.S. airlines. Between 2013 and 2015, the seven shareholders who controlled 60% of United Airlines also controlled 28% of Delta, 27% of JetBlue, and 23% of Southwest. Together these airlines have over half of domestic market share. Theory and evidence suggests that horizontal shareholding harms competition, consumers, and the economy.

Increasing common ownership

Companies are traditionally thought of as having unique owners that try as hard as they can to drive up their market share and profits at the loss of their competitors. But when a firm is predominantly controlled by shareholders who also own that firms’ competitors, those common owners try to maximize the value of their entire portfolio — encompassing competing firms in the same industries — rather than the value of any one firm. Otherwise, any profits they gain from one firm will be roughly matched by losses at its competitors.

Consider two food trucks across the street from each other, both owned by their respective chefs. If one chef decided to cut their prices, they would direct customers away from their competitor across the street and thus increase their own profits. This is business as usual. But if both food trucks were instead owned by the same group of local investors, these owners would not support one truck cutting its prices because it would simply shift business from one outlet to another, with a lower total profit to the investors.

Competing U.S. airlines share many of the same owners and, although the effects on competition are perhaps inadvertent, the outcomes are directionally the same as the example describes. With an overlapping (but distinct) set of shareholders, a firm that takes market share from its commonly-owned rival will earn its owners some profit but, since they also own shares in the rival firm that has just lost profits, the total earned by the common owners will be smaller than if each company was owned separately. What is important for competition is therefore the relative influence horizontal shareholders have on a firm compared to other owners that are more incentivized to increase that firm’s profits because they are not also invested in competing firms.

In many industries the same institutional investors are the largest owners of many competing companies. This is true for the largest U.S. banks and in retail pharmaceutical, where Vanguard and BlackRock are the largest (non-individual) owners of CVS, Walgreens Boots Alliance, and Rite Aid (with State Street not far behind in two of the three). In supermarkets, too: Vanguard, BlackRock, Capital Research, Fidelity, and State Street are the five largest owners of Kroger, five of the six largest owners of Costco, and four of the seven largest owners of Target. The three largest shareholders of Apple are also three of the top four (non-individual) owners of Microsoft.

In fact, in many of these industries common ownership is even higher than it first appears because some large stockholders, such as J.P Morgan Asset Management, may be owned in part by other institutional owners. The following chart shows by just how much common ownership has increased in U.S. industries between 1994 and 2013. In fact, the probability of two competing firms in the S&P 1500 having a large horizontal shareholder increased from 16 to 90 percent.

Diversification versus competition

This reflects a more general shift towards passive investment strategies such as index funds that rely on portfolio diversification. One of either Blackrock, Vanguard, or State Street is the largest shareholder in 88% of S&P 500 companies. They are the three largest owners of most DOW 30 companies. Overall, institutional investors (which may offer both active and passive funds) own 80% of all stock in the S&P 500. Their representation among the top 10 shareholders of U.S. corporations has skyrocketed since the 1990s.

This is not all bad. Institutional investors have grown so much because they offer small-scale savers the opportunity to invest in diversified funds with economies of scale. Indeed, horizontal shareholdings initially grew with the rise of institutional investors following legislative and tax rule changes in the late 1970s and early 1980s that created retirement savings accounts. BlackRock and Vanguard are “only the most recent incarnation” of a longer-term rise in diversified investment strategies. But it is impossible to have complete portfolio diversification, shareholder representation, and competition.

The necessary flip side to portfolio diversity is increased common ownership. Although theory predicting negative effects of horizontal shareholdings dates to at least 1984, only recently has a substantial amount of research emerged that articulates how common ownership leads to anti-competitive actions, provides corroborating empirical evidence, and proposes policy responses.

Anti-competitive incentives for managers and funds

The common owners of rival firms do not benefit when the firms compete by cutting prices or expanding output. In fact, they may even “soften competition” among firms in their investment portfolio. To begin with there is the potential of active efforts to stymie competition, such as encouraging the signing of anti-competitive agreements or passing sensitive information between two commonly-owned competitors. Of course, this sort of collusion is already likely to be prosecuted under current anti-trust practices. More worrying is the unintentional collusion through the owners’ corporate governance communications, the information flows between the firms and owners, and the incentives to lessen competition that common ownership brings, without any coordination or communications among the ostensibly competing firms.

Let’s look at the interplay between the shareholders of large corporations and the managers that actually run them. Managers need shareholders to vote for their corporate initiatives and their re-election. To accomplish either, smart managers will maximize the weighted average of their shareholders’ profits from across their diverse portfolio of stockholdings. This way they will gain the votes of shareholders’ whose profits they boost by increasing the value of both the manager’s firm and the other companies held by that shareholder. It would be “remarkable” if firm managers did not pay attention to the profit interests of their leading shareholders given the various sources of corporate accountability such as executive compensation incentives, takeovers, control contests, labor markets, and direct communications.

Horizontal shareholding therefore hurts competition because, as Einer Elhauge of Harvard Law School has argued, it reduces “each individual firm’s incentives to cut prices or expand output by increasing the costs [to shareholders, and thus managers] of taking away sales from rivals.” These issues are easy to imagine with direct investors (such as activist hedge funds) who typically have more concentrated holdings and thus greater ability to influence practices within a company or industry.

Some experts argue that institutional investors, particularly index funds, have little incentive to influence firms to behave anti-competitively because the direct and indirect costs incurred when influencing a firm to increase its value exceed their rewards (the annual fee charged on the market value of the index fund). But it is near-costless for index funds to influence a firm to behave anti-competitively through voting on general corporate governance matters that apply to all corporations in their portfolio. Moreover, proxy advisory firms lessen the effort that index funds need to exert by providing them with company research and vote administration services, and even guiding their voting.

Proxy firms could also shield indexes from the indirect costs of their efforts (aggravating corporate managers and causing them to divert their corporation’s pension assets to other funds), since the indexes are simply following the proxy’s guidance. Finally, the incentives to lobby for anti-competitive behavior are even greater for active funds, which are a much larger share of horizontal shareholdings. And although money managers at an institutional investor look after a relatively small portfolio, the shareholder voting rights of all funds within the institutional investor fund family are usually exercised jointly. The “rise and consolidation of intermediated asset management” increases the shareholder power of large diversified owners and reduces portfolio firms’ competitive incentives.

The harms of common ownership

Horizontal shareholding clearly has negative consequences for competition. But do the damages reach further? Since the 1980s anti-trust policy has focused on one goal: consumer welfare. Fears of the economic, political, and social harms of concentrated economic power have been narrowed in anti-trust jurisprudence to questions about how consumers are affected.

Several studies have found clear empirical evidence that anti-competitive horizontal shareholdings lead to increased consumer prices. A ground-breaking study found that the degree to which airlines serving a particular route are commonly owned is correlated with ticket prices on these routes (controlling for possible confounding factors). Ticket prices increase anywhere from 3% to 12% due to common ownership. Similarly, common ownership among banks in a particular county is associated with higher fees and lower deposit interest rates. Increased horizontal shareholding between an incumbent pharmaceutical brand and a generic entering its market made it 12% more likely that the firms would agree to pay the generic firm to stay out of the market, which led to higher returns for the incumbent because prices remained high.

One consequence of this is increased economic inequality. Higher prices result in higher returns to capital for horizontally competing firms, which mainly benefit the Americans higher up the income distribution who disproportionately own stocks. Yet all of society bears the costs of less competitive goods and services. This means that “the potential beneficiaries of anti-competitive behaviour — investors — are often wealthier than the consumers who pay the higher prices.” In fact, as the chart below shows, the increase in common ownerships from 1985 to 2015 coincides with the rise in wealth inequality. These relationships are not too far-fetched. After all, typical market share measures of concentration are associated with increased inequality. U.S. sectors where concentration rose the most experienced the largest declines in the labor share of firms’ profits.

There is also solid evidence that common ownership skews executive compensation and dampens corporate investment. Horizontal shareholders maximize profits when managers have weaker incentives to increase their firm’s profits and lower costs, since this would come at the cost to commonly-held rival firms. The result is executive compensation being based more on the performance of a firm’s total industry rather than the firm itself.

Horizontal shareholding also drives the “historically large gap between corporate investment and profits.” This gap is larger in concentrated industries and, within any industry, the investment-profit gap is driven by firms with high horizontal shareholding levels. Lower corporate investment contributes to inequality by depressing employment and wages, which disproportionately harms the non-wealthy. Finally, there is no possible efficiency defense. Horizontal shareholding does not result in increased efficiencies to firms, unlike standard mergers, because operations are not combined to create economies of scale. The benefits from common ownership are to stockowners and to investment funds.

Taking action against horizontal shareholders

Several policies have been proposed to counteract the harms of horizontal shareholdings. The U.S. agencies responsible for anti-trust have so far expressed disinterest in prosecuting any horizontal shareholdings, although the Federal Trade Commission held a hearing in December to study the matter. Some studies skeptical of the harmful effects of common ownership have been amplified by finance industry-funded groups, but have been effectively rebutted.

Current anti-trust legislation provides a basis for prosecuting horizontal shareholdings by banning stock acquisitions that may substantially lessen competition. Some argue that any horizontal shareholdings calculated to result in highly concentrated industries should be investigated for their effects on consumer prices. Others think the government should publicly offer investors a “safe harbor” from prosecution if they either limit their active holdings of a firm to a small stake or own the shares of only one firm per industry. This would allow free-standing index funds that commit to pure passivity to not be limited in size. A less drastic suggestion (but which would require new legislation) is to take away tax advantages enjoyed by retirement funds that are invested in mutual funds with a significant number of shares in more than one firm in an industry. These funds could still offer diverse investment portfolios, but only across industries rather than across competing firms in an industry.

These policy proposals merit substantial consideration. A popular anti-trust movement successfully defeated corporate trusts once in the U.S., so there is hope that meaningful action against resurgent monopolists is possible.

Blackrock and Vanguard probably own Bubba’s Shrimp business now. Along with all its competitors. Oh, they own Ukraine too.

I urge you to take off those braces around your legs, Forrestovski and run. Run like there is no tomorrow. Embrace the new world where democracy went wrong. Where decisions were made by faceless men in back rooms and compromised politicians rubber stamped their requirements, RUN, FORRESTOVSKI, RUN!

[Vangelovski]

RtG,

Are you suffering from some sort of mental breakdown? Your rant is completely incoherent. You've just become the new Prolet.

[Risto the Great]

Don't want to respond to the content, Forrest? Harvard beneath you? You better get back to Facebook for your factual content.