Turning Passions Into Interests

It's easy to be generous when you're rich. So get rich. [The Rude Awakening] October 05, 2023 [WEBSITE]( | [UNSUBSCRIBE]( Sean is at the Paradigm Shift Conference in Las Vegas, so here's a Rude from back in the day for you to enjoy. He'll be back live Friday with a report on the conference. Have a great day. --------------------------------------------------------------- Turning Passions Into Interests - My neighbors have been incredible during this crazy typhoon recovery phase. - Some gave water; some gave electricity. We all watched each other's kids. - Professionals, entrepreneurs, business owners. We've got them all in Santo Nino Village. [URGENT: Unclaimed Giveaway Offer]( We have an item of considerable value on hold for you in our warehouse. Valued at nearly $300, this [special item]( is an opportunity you wanted to miss. [Click here to see how to claim yours now.]( [Click Here To Learn More]( [Sean Ring] SEAN RING Grab your cup of joe while I try to put some theory and thought behind my comments yesterday. "He'd Give You The Shirt Off His Back." To me, the above quote describes a nice, poor person. There’s nothing wrong with that, but I never understood why that compliment was the highest you could give a man. It's almost like saying, "He's a great guy, but he can't organize his financial affairs." Folks, there's a reason stewardesses tell you to put your mask on first before you help anyone else when you're on a plane. You've got to take care of yourself before you can help anyone else. This leads me to my neighbors. The Worst House in the Best Neighborhood Thanks to this storm, I now have a keen understanding of why real estate agents tell you it's better to own the worst house in the best neighborhood rather than the best house in the worst neighborhood. We don't live in the worst house, by the way, not by a long shot. But some of the villas in our subdivision are impressive. They're not McMansions of the cheap American kind. You can't build that crap here with the humidity. The house would rot within a year. But these houses are big, fitted with their own generators, and perfect for this humid climate. Unfortunately, my landlord was a cheapskate and didn't kit out this house with its own generator. I'd have no problems right now besides cash and gas if he did. But here's the thing. These professionals, business owners, and entrepreneurs - all people whom middlebrow bureaucrats would have us hate - are the very people who've made my family's life bearable during this mess. Our next-door neighbors, doctors both, handed us a 50-meter extension wire to plug in our gadgets. They have a generator and loads of excess kilowatts. Because of this, we reached our families to tell them we were safe. And we slept much better with our fan cooling us during the night. Our across-the-street neighbors had loads of fresh, running water because of their generator. We fill up twelve 5-gallon jugs per day to wash and shower. And we’re not the only ones. Folks are coming from miles around to get their water. And it's nothing to them. Why? One, because they're really lovely people. And two, because it's easy to be generous when you're rich. [AI Discovers Breakthrough New Cancer Treatment?]( Just recently, scientists in Canada were able to use AI to create a new cancer treatment in less than 30 days! Now, cancer alone is a significant market worth hundreds of billions of dollars annually… Just think about the implications if AI were to find a cure and take over this market. Now take a moment to picture what might happen if AI were to cure other diseases like Alzheimer’s… heart disease… and more – as I fully expect it will… [It could be worth trillions of dollars of economic impact – and keep in mind we’re still only talking about one industry](. The fact is, AI is the single biggest innovation in the history of humanity. That’s why I believe anyone who invests now – while this new technology is still in its infancy – could see the chance at making generational profits. [Click here now to see the 3 tiny AI stocks best positioned to profit](. [Click Here To Learn More]( Money Making as an Interest Years ago, I picked up The Passions and The Interests: Political Arguments for Capitalism before Its Triumph by Albert O. Hirschmann. It's one of those books I bought for my Umberto Ecoian "anti-library." That is, it was for reference and research. But I wish I had read it sooner. It's as rich as a chocolate gateau, an epic treat for those who ever wondered how we went from seeking God to seeking glory to seeking riches - and how and why we did so. Hirschmann takes you by the hand through the seventeenth and eighteenth centuries to show you how those who fought for capitalism won the ideological argument. Regrettably, I can't take you through a full review. But I will tell you about a few things that jumped out at me and how they relate to the issues at hand. Whose Hand Was That? The first thing that shocked me was that the Invisible Hand was an invention of Montesquieu, not Adam Smith. Montesquieu wrote that the pursuit of honor in a monarchy "brings life to all parts of the body politic," and as a result, "it turns out that everyone contributes to the general welfare while thinking that he works for his own interests." That's the Invisible Hand leading you to glory, not riches. But I like Smith's adoption of it for the latter purpose. It was essential to counteract the church's ideas - especially St. Augustine's - that lust for money, power, and sex were man's three principal sins. It's as Easy as 1, 2, 3! First, they tried to repress and coerce man. St. Auggie - I went to Villanova, I get to call him that - and old Johnny Calvin were big fans of this. But it wouldn't take. By the Enlightenment, the day's best and brightest realized that The State suppressing these vices didn't solve any problems. They just created incentives to circumvent authority. Sound familiar? Second, the powers that be tried to harness the passions. This was better, but we're not there yet. Giambattista Vico, the great Italian polyglot, wrote: Out of ferocity, avarice, and ambition, the three vices which lead all mankind astray, [society] makes national defense, commerce, and politics, and thereby causes the strength, the wealth, and the wisdom of the republics; out of these three great vices which would certainly destroy life on earth, society thus causes the civil happiness to emerge. This principle proves the existence of divine providence: through its intelligent laws, the passions of men who are entirely occupied by the pursuit of their private utility are transformed into a civil order which permits men to live in human society. Hegel's concept of the Cunning of Reason echoes this by saying men, following their passions, actually serve some higher world-historical purpose of which they are totally unaware. The State would be a transformational force rather than a coercive one in this role. Essentially, let the people do what they want, as long as they make money and don't infringe on the rights of others. But the central issue was how this transformation happens. This is where David Hume comes in, and The State exits. Hume wrote in his Treatise, "Nothing can oppose or retard the impulse of passion but a contrary passion." As an aside, I remember watching Samuel L. Jackson talk about how getting addicted to golf got him off his drug addiction. For Robert Downey, Jr., martial arts replaced drugs. I thought both their stories were nonsense until today. The great thinkers of yesteryear wanted the body politic to substitute "passions" with "interests." No coercion. No repression. And no State, funnily enough. Just find something more beneficial to which you can get addicted. And boy, does making money suit that bill! Dr. Johnson himself once said, "There are few ways in which a man can be more innocently employed than in getting money." To them, passions were wild; interests, harmless. To be sure, it was important to pursue wealth sensibly. When indulged to excess, it can lead to disastrous results. If only these guys could've seen Enron, Lehman, and Evergrande! But even better, they should see my neighbors - and all those who lent a hand to another during these crazy disasters. Wrap Up I'm not a philosopher per se, so I hope my casual writing sufficed. I think the idea that we're all against each other in some sort of class war is Marxist nonsense. I've seen more goodness in the past few days than I have for a long time. Yes, the benefactors have money. Yes, the beneficiaries don't have as much. To me, the message is to become as financially successful as possible. That way, you can "feel possession," as psychologists say, and once you do, you can pass on to others what you don't need or want. All the best, [Sean Ring] Sean Ring Editor, Rude Awakening X (formerly Twitter): [@seaniechaos]( In Case You Missed It… Why Character Matters [Sean Ring] SEAN RING I read with great interest in the Journal that Elizabeth Holmes was found guilty on four charges of fraud for her stunning duplicity in running Theranos. Each charge carries a 20-year prison sentence. While I’m pretty sure she won’t get 80 years, she’ll get some robust prison term… I hope. I won’t go into the case’s specifics too much, but I’ll instead use it as a basis for my arguments that character matters more than expertise in running a business. London, Autumn 2001 “Mate, my company’s shares are trading at $2. I think it’s a bargain.” “Dude, your company is about to declare bankruptcy. It’s over. Save your cash.” I remember that conversation like it was yesterday. The sequence of events that led up to it still makes me giggle. So here we go. When I moved to London in 1999, I immediately befriended a work colleague, AA. He was Australian, handsome, and loved pints of beer as much as I did. He had a beautiful wife and several beautiful girlfriends. But as I got promoted onto a trading desk, he was still stuck in operations. He was desperate to get out, as I was only 12 months before. As is the time-honored strategy to get on a trading desk, operations people sidle up as best they can. And sometimes, they overstep the mark. I was sitting on my desk one day, and the dealer board lit up. I picked up the phone. “Hey, mate.” “Hey.” I heard the swirling, gale-force wind that hits Canary Wharf in London, where our offices were. “Where are you?” “I’m outside. I just got sacked.” Later that afternoon, I found out AA had sent a “dubious” email to his trader buddy, and the guy reported him to Human Resources. I was indignant on his behalf, as I didn’t think - and still don’t - people should get fired for sending joke emails… even if there’s objectionable stuff in them. Call me old-fashioned. Anyway, the question was what his next steps were. AA didn’t have a finance degree or anything like that. He was just a smart, handsome Aussie dude. The kind of man British Human Resources professionals take a chance with. No idea why. (Wink, wink.) About a month later, he buzzed me on my old Nokia. “Matey, I’m so lucky. Things happen for a reason. I’m so glad I got sacked. I just landed the job of my dreams!” “Awesome. I’m so happy for you. That’s great. Who are you working for?” “Enron.” This was September 2001, I hasten to add. [Warning: Will “Bidenflation” Destroy Your Retirement?]( [James Altucher]( If you’re like most Americans, you’ve worked hard for decades to build your financial legacy. And now, as a result of Biden’s disastrous money printing policies, that’s all at risk. According to one top retirement expert, “Bidenflation” threatens to destroy your retirement and make your hard-earned savings worthless. That’s why you must take action right away to protect yourself… [Click here now to get the simple, step-by-step actions to survive “Bidenflation.”]( [Click Here To Learn More]( "We are the good guys. We are on the side of angels". Ah, Jeffrey Skilling. Remember that bastard? He was the CEO of Enron, formerly the seventh-largest company in the United States. What was scary about the Enron scandal was that the top 3 people running the company perpetrated the fraud. Chairman Kenneth Lay, CFO Andrew Fastow, and CEO Skilling were the guys who were found guilty. Lay had the good sense to die before he went to prison. But Skilling served 14 years in federal prison, and Fastow served six. Fastow cut a deal with the prosecutors. So impressed were they with his performance - that is, skewering his former colleagues - the prosecutors lobbied for a lower sentence. We still talk about that case in my graduate classes. Though the kids I teach were toddlers around the time the scandal broke, “Enron” has become a byword for fraud. And that’s exactly as it should be. Richard Mayberry gets this right in his Uncle Eric books. “Do all you have agreed to do, and do not encroach on other persons or their property.” This directive covers everything, really. Uphold contracts and don’t rob people. Of course, my friend AA didn’t benefit from working for people like that at his new company. He was looking for a new job a mere three months later. Heck, Enron used to stage their trading floor for CNBC interviews. That is, they’d pack it with people who weren’t traders just to make it look like a bank trading floor. Awful. And there was the issue of Skilling calling a fund manager an “asshole” for having the audacity to ask him where Enron’s balance sheet was. This is what Skilling said about it: The specific fellow that I was not real happy with is a short-seller in the market. I don't think it is fair to our shareholders to give someone a platform like that they are using for some personal vested interest related to their stock position. I get a little exasperated with that sort of thing, and I want people to know I am exasperated. When in reality, he resorted to namecalling to cover up his fraud. I was positively thrilled when Skilling and Fastow went to prison. This wasn’t a so-called “victimless crime.” Enron workers lost their houses betting on Enron stock because they thought Enron’s Big 3 guys were the be-all and end-all of business. Sure, you can call them “co-conspirators,” but did they really know what was going on? Heck, Arthur Andersen, Enron’s auditors, didn’t call them out. (Auditors’ incentives are another topic entirely.) Investors lost billions of dollars. Character and Trust Character is who you are, and reputation is what everyone thinks of you. Both are important, but character is controllable. It’s upgradable. As a father, I tell my son every day, to tell the truth. He’s at that stage where he tries to wiggle out of everything. Good character leads to trust. And trust is critical to free markets. [Lipton Matthews]( wrote a great article on this. Here’s a quote: Trust makes it easier to do business by lowering transaction costs. When entrepreneurs trust each other, they are likely to collaborate and reap the fruits of innovation. In a trusting environment, businesspeople form lucrative deals before signing a contract, knowing that both parties will comply with the agreement. For instance, Macauley (1963) argues that entrepreneurs rarely depend on legal enforcement to solve disputes and in many cases actually fail to create contracts stipulating conditions with customers. Trust greases the wheels of our economy. It genuinely makes the world a better place. Of course, there will always be the odd Enron scandal. That’s why it’s essential to prosecute these criminals as vigorously as possible. They genuinely stain the world we live in. And that’s why I’m thrilled Elizabeth Holmes got smacked in the mouth, legally speaking, of course. We can’t have this sort of behavior go unpunished. Luckily, Theranos wasn’t publicly traded, and most of the evaporated wealth was paper. But it could’ve been much worse. May she spend a good decade or so behind bars. All the best, [Sean Ring] Sean Ring Editor, Rude Awakening X (formerly Twitter): [@seaniechaos]( [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2023 Paradigm Press, LLC. 808 Saint Paul Street, Baltimore MD 21202. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your Rude Awakening e-mail subscription and associated external offers sent from Rude Awakening, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@rudeawakening.info. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. 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