pigs at the democracy trough

99% of what people “hate about capitalism” is not capitalism at all, it’s crony corporatism dancing around in the skinsuit of free markets while making pretense to equity or safety and this has become the big business of our time. it’s not just a business model, it’s a full blown phoney baloney ethos to justify it and extol it as virtue.

people have no idea how captured this system has become, but in the presence of so much state fiat such is basically inevitable for if democracies last until the demos learns that it may vote itself largess from the public purse, so too do free markets last only until politicians able to dictate that which is bought or sold are themselves bought and sold by those with vested interests in such coercive commerce.

big business does not like free markets. they like monopoly, oligopoly, and subsidy.

given the chance, that is what they will do.

so let’s be very clear about the state of play:

and once you have “big government” you cannot fix that, not ever.

it’s an arms race, but not the one people think.

it’s an arms race for hearts and minds.

the demos, shown a massive big business smash and grab to rob them, will buck and resist. this is why crony corporatists always and everywhere lie and cast their thievery as safety, prudence, and the common good.

everywhere and always where legal plunder must be validated, justified, and lionized, the system is the same.

regulation, strategic need, safety, equity, inclusion it’s all a puppetshow to mask the crime and dress it up as morality.

and where this really goes wildly, extraordinarily, trillion-dollar sinkhole in short order wrong is when the state basically takes it upon itself to (for the common good of course) dominate a whole market and thereby underwrites a bubble.

the 2008 crash is a fine example. the CRA mandated bad loans that banks would never have written. then freddie and fannie guaranteed them all using uncle sam’s credit card and turned out trillions in janky MBS’s all rated AAA (because of these stamps) but full of subprime dross. this all blew up just as one would expect and despite the fact that most banks actually paid back all of TARP with interest, the quasi gobvenment agencies (freddy, fannie, ginnie) and a few other egregious abusers (AIG, inexplicably the auto companies) left the taxpayers holding the bag.

they are gearing up to do it again and if you bear with me, i’ll show you why:

we start with space X and the impending IPO. the S-1 is a fine read and highly illustrative. 90% of the proposed TAM is neither space nor starlink, it’s AI. and whoo doggie are the AI losses whopping. X AI (grok) was folded in in 2025. the results were not subtle. (coallated, amusingly, by claude)

X AI is a massive money pit. this IPO is to cover its extreme cash burn and the IPO itself looks amazingly fraught. the deal has every bank in creation on it and they look to be struggling to get it over the line. they have upped retail allocation to somewhere between 30-40% depending on how you make assumptions and firms that usually gatekeep shares like this for accounts with $500k+ in assets are letting in $5k proles. that’s not “democratizing investing” that’s “run down the sophistication curve until someone will fund this pig.”

whether they can hold deal price is an interesting question. but musk is smart. open AI and anthropic both want to IPO this year and both will be massive capital sucks. he’s getting his first and drinking their milkshake. but both need money and both will struggle to find it once the actual economics of their models are laid plain. and we think they know it which is why i think that this is happening: we’re at a market top and there is no more money to fund the bubble.

many are calling this socialism or some sort of fascist structure, but i suspect that’s a red herring. i think it’s crony corporatism and that open AI and anthropic are going to play the “oh no, please don’t throw me in that briar patch” game to the hilt when it is, in fact, they that asked for this.

they want it.

they need it.

there is no other bagholder of last resort with enough money and utter valuation insensitivity to get them the cash they need to keep the incineration cycle of capital ongoing and sell more dollars for 20 cents.

the public markets are simply not going to pay these valuations especially once they see some audited financials. you can prop them up in the VC fantasy land where “mark to market” does not exist and one tiny buyer changes the list price for all and trades are by permission only, but public is a whole different matter and the mackerel of reality rapidly arrives wet and slappy.

the fact that bernie and cherokee liz are also in on this game means that, per my comment yesterday

it’s easy to laugh at this as a distant transmission from “planet never gonna happen” but many crazier things have

the venn intersect of team trump and the bernie bros is a event horizon level “nothing reasonable can escape” singularity of economic illiteracy.

there’s a really scary coalition organizing here to buy the top.

watch.

the US government is floating trial balloons right now to put (i’m just making up numbers) $500 billion into private companies at crazy valuations that no private fund would pay. it’s going to be gigascale $1200 toilet seats masquerading as “the public needs to share in the wealth” and “strategic imperative to win the AI race.” in reality, it’s going to be a massive capital loss used to fund astonishing corporate losses by companies who will soon be back needing more at which point “we need to put in $500 billion more to protect our first $500 bn” will be the order of the game and investing by sunk cost fallacy will be portrayed as “keeping america ahead.”

the reality is it’s “keeping the sand hill road team liquid” and that matters more than you think because the money tied up there is all the pension funds and endowments in america and the size of the over-marked circular reference trash pile of illiquid overvaluation that they are currently holding is one for the ages.

so the treasury bails them out while making the VC’s rich, everyone makes a donation to the favorite politico, and this horrendous locust plague lives to devour another field.

the setup is actually simple:

bubbles burst when there is not enough capital left for the next round of ponzi exponential. space X is showing us that the capital river is running dry. anthropic and open AI see at and are looking for dumber money to fund them to try to get out and to keep the funds that hold them from getting creamed.

that dumb money?

it’s going to be us.

they don’t want IPO’s. they want to keep their fins under wraps.

many will mistake this for socialism or for “strategic necessity” or some other pretextual claptrap, but it’s not.

it’s smash and grab state sponsored robbery.

the corporate raiders of the 1980’s (who at least were (sometimes) doing reasonable work pulling apart ossified corporations) have become the crony corporatist public trough swillers of the 2020’s.

and nothing they do is ever useful.

this is plunder, pure and simple.