Thirteenth law of worker entropy: Difference between revisions
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Hence, ''pace'' Blaise Pascal, [[charge-out rate]]<nowiki/>s tends to rise, not fall, with prolixity. | Hence, ''pace'' Blaise Pascal, [[charge-out rate]]<nowiki/>s tends to rise, not fall, with prolixity. | ||
Similarly, ''v'' is actual, real-world value, and not “notional fright-value imbued by the neurotic expostulations of paranoid lawyers”. ''v<sub>f</sub>'' is a kind of bounded cosmological constant. | Similarly, ''v'' is actual, real-world value, and not “notional fright-value imbued by the neurotic expostulations of paranoid lawyers”. ''v<sub>f</sub>'' is a kind of bounded lexo-cosmological constant. | ||
Thus, a [[Medium term note|secured medium term note]] — typically in the tens or hundreds of millions of dollars in principal amount — has high intrinsic value even though the basic premise of a transaction — “I lend you money, you give me a an [[IOU]], I can sell it, you repay whoever holds it at maturity, with interest, depending on certain externalities” — is simple. | Thus, a [[Medium term note|secured medium term note]] — typically in the tens or hundreds of millions of dollars in principal amount — has high intrinsic value even though the basic premise of a transaction — “I lend you money, you give me a an [[IOU]], I can sell it, you repay whoever holds it at maturity, with interest, depending on certain externalities” — is simple. | ||
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===Worked example=== | ===Worked example=== | ||
Take a USD500m loan. Even 0.05% of the deal value — | Take a USD500m loan. Even 0.05% of the deal value — a mere 5 [[basis point]]s — is USD250,000. Is it any wonder the service economy is in such rude health? Who ''wouldn’t'' pay that to make sure nothing went wrong on half a yard of debt finance? | ||
But even at USD500 an hour, that is ''five full working weeks'' of a [[legal eagle]]’s time:<ref>At 40 hours per week. Yes, we know that nowadays a transatlantic lawyer can expect to recover more billable hours per week than there actually are in the week, but we are assuming traditional laws of spacetime apply.</ref> it really wouldn’t do if all that was required was to top-and-tail the term-sheet with [[boilerplate]] and bang out an enforceability [[Legal opinion|opinion]]. Nor would there be much prospect of stopping clients going to some other guy down the road who will do the job in a day and send a bill for a £500. So somehow we need to make this seem a bit more complicated. | But even at USD500 an hour, that is ''five full working weeks'' of a [[legal eagle]]’s time:<ref>At 40 hours per week. Yes, we know that nowadays a transatlantic lawyer can expect to recover more billable hours per week than there actually are in the week, but we are assuming traditional laws of spacetime apply.</ref> it really wouldn’t do if all that was required was to top-and-tail the term-sheet with [[boilerplate]] and bang out an enforceability [[Legal opinion|opinion]]. Nor would there be much prospect of stopping clients going to some other guy down the road who will do the job in a day and send a bill for a £500. ''So somehow we need to make this seem a bit more complicated''. | ||
Still: is it ''really'' possible to charge six figures for an [[IOU]]? Well, have a butcher’s at this [https://www.ise.ie/debt_documents/ListingParticulars_cd8daa3f-24e8-419a-819a-cf3e23a03271.PDF this 370-page beauty] and allow me to rest my case on it, since it plainly wouldn’t fit ''in'' it. Quarter of a mill well spent.<ref>We have NO idea how much the legal fees on this were, and it may be wildly defamatory to imply it was that much. Of course it could have been more.</ref> | Still: is it ''really'' possible to charge six figures for an [[IOU]]? | ||
Well, have a butcher’s at this [https://www.ise.ie/debt_documents/ListingParticulars_cd8daa3f-24e8-419a-819a-cf3e23a03271.PDF this 370-page beauty] and allow me to rest my case on it, since it plainly wouldn’t fit ''in'' it. Quarter of a mill well spent.<ref>We have NO idea how much the legal fees on this were, and it may be wildly defamatory to imply it was that much. Of course it could have been more.</ref> | |||
{{sa}} | {{sa}} | ||
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{{C|Laws of worker entropy}} | {{C|Laws of worker entropy}} | ||
{{ref}} | {{ref}} | ||
<references /> | |||