Remember, the purpose of State Capitalism under the Work-Standard is to consolidate political power and develop the necessary and proper economic and financial firepower to embark on another economic model. Once everything has been built and stabilized, only then can anyone speak of a transition toward either Syndicalism, Corporatism, or Socialism. There is no definitive timeframe as to when that day might occur. It may happen sooner or later. Whatever the case may be, it is always in the interests of the audience of The Work-Standard (3rd Ed.) to wield the means of production within the existing framework of a Liberal Capitalist Parliamentary Democracy.
The fact that The Work-Standard (3rd Ed.) had to appeal to State Capitalists and Social Capitalists is a confirmation of the fact that it was written for two different types of audiences in mind. It was always written from the presupposition that the Reader is not guaranteed to be living under any regime that did not adhere to Neoliberalism. If anything, they may actually be living under an existing Liberal Capitalist nation. Whatever the case may be, for those living under Liberal Capitalism, it bears mention that I have been experimenting with the Financial Markets insofar as they act as though they are the key driver of economic life for Market/Mixed Economies in the Western world.
Over the past several months, I had invested more than $1,000 USD in Stocks and Bonds, those LCFIs (Liberal Capitalist Financial Instruments) which serve as the Neoliberal opposite of two Work-Standard NSFIs, the “Fiefs” and “Work-Plans” respectively. I wanted to find out how they operated in economic life, in addition to ascertaining how accurate my discussions of those LCFIs were in The Work-Standard and the other Treatises. As I had correctly concluded, some of what I wrote is correct, but they could have been elaborated on.
What I could have elaborated in much greater detail is how Stocks and Bonds accrue Interest and Dividends because not all Stocks have an attached Dividend. Some Stocks do offer Dividends as an Incentive to encourage Investors to hold onto them and refrain from selling them. The Value of the Dividend can be calculated from the Price for the Stock to yield an annual percentage for the Dividend Yield.
Dividends may be set on a monthly, quarterly, semi-annual, or annual basis. They are always determined by the privatized commercial firm issuing the Stock. Suppose for a moment that the Value of the Dividend is $2.00 and the Price for the Stock is $40.00. If the Value and the Price remained constant, then the Dividend Yield is 5%.
Granted, most of the Stocks that I had encountered at the Financial Markets would try to aim for Dividend Yields no higher than 7%. Rarely do they reach upwards of 10% because that is usually a sign that the privatized commercial firm is preparing to opt for a cut in Dividends, especially if the Current Market Price is too low.
At the same time, investing in Stocks at higher Prices should be avoided as much as possible in order to mitigate any potential losses. It is better to invest in a variety of Stocks across different Industries than to invest in only one. Any potential losses sustained by one Stock can be absorbed by the others, which has become the rationale behind investing in Exchange-Traded Funds (ETFs) or Mutual Funds.
Another observation I noticed is that the best Stocks tend to those which are offered by well-established, well-known and well-recognized privatized commercial firms. The Values of their Dividends are decent, the Price for their Stocks stable and can see potential for further growth. Based on how much I invested, I noticed that I was gaining $50 in Dividends, the Price of the Stocks increasing by $50. Had I invested $10,000 USD as opposed to $1,000 USD, I am willing to believe that I would have gotten $500 in Dividends and $500 USD from the Stocks’ rising Prices.
This brings me to a more important and long-term conclusion. Acquiring Kapital from Stock Dividends and accruing Interest at rates in excess of $10,000 will require accumulating hundreds of thousands of US Dollars. Such a conclusion, while a valid one in the early 2020s, is not the case if one had invested in the 1990s, 2000s or the 2010s in some cases. A lot of Stocks did see their Prices fall tremendously in the Great Recession and the Coronavirus Pandemic, which would have been ideal moments to invest in a lot of Stocks at a fraction of the Kapital it required. Once the Financial Markets recovered, I can easily envisage someone earning that particular amount.
Of course, whether that someone manages to accomplish this goal depends on how much they needed to pay in Income and Capital Gains Taxes. Income Taxes increase exponentially the more Kapital one accumulates from income. The Capital Gains Tax, meanwhile, can be as high as 25%. Fortunately, there are ways of claiming tax deductions or tax credits to reduce how much needs to be spent on Income Taxes.
The strategy I have in mind is a “hundred-by-ten plan.” In essence, it is a personal Five-Year Plan that I had established for myself. I will set aside $500 USD each month to purchase ten Stocks. The goal at the end of the Five-Year Plan is to achieve more than $500 in Dividends. If I manage to attain employment where I can set aside $1,000 USD or more, I will adjust the Five-Year Plan accordingly.
As of this writing, I should mention that Compact Magazine maintains an organization that accepts donations, all of which are tax deductible. I might try to contact one of the people in charge to find more information. A future post is definitely in order on this matter.
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