Slaves played by the Stock Market

Interesting idea popped into my head. In a world where slavery remains widespread, most likely through debt bondage or similar deals, it might be possible for the stock market to play the value of slaves on the futures exchange. So what would have to happen for things to get like that?
 

mowque

Banned
Slaves would hard to put on a future exchange market because each slave is so different. The values could range widely. Besides, do they change hands enough to generate that type of trading?
 
Quite. And don't forget that the true value of a slave is his (or her) labour...and, if we are going to be brutally honest and honestly brutal, their offspring. If you're spending hours and days trading them for value then they aren't working so the labour value disappears, while the value of their unborn children cannot grow or diminish until you know what quality each child is, which requires them to be born.
 
Slaves would hard to put on a future exchange market because each slave is so different. The values could range widely. Besides, do they change hands enough to generate that type of trading?

Quite. And don't forget that the true value of a slave is his (or her) labour...and, if we are going to be brutally honest and honestly brutal, their offspring. If you're spending hours and days trading them for value then they aren't working so the labour value disappears, while the value of their unborn children cannot grow or diminish until you know what quality each child is, which requires them to be born.

Well....to distill this down into a simpler answer: Interesting idea for sure, but in all likelihood it just wouldn't work too well.
 
The right model isn't stocks based on slaves -- it's bonds and asset-backed securities.

In OTL, southern slaveholders often used slaves as collateral (e.g., http://diverseeducation.com/article/4323/).

It's easy for a collateral-backed bank loan to turn into a bond-like asset-backed security -- we've seen it happen with lots of different assets in OTL. Mortgage backed securities are the closest parallel. A bank can package its slave-backed loans into a bond-like security that pays interest, and is backed by the collateral of the underlying loans. It would then sell the security to interested investors. Once a market for these securities evolved, large plantations could sell directly into the market, bypassing the bank.

In OTL, these kind of securities didn't get started until the 1960s, and various government interventions (leverage restrictions on banks plus Ginnie Mae/Freddie Mac mortgage purchases) played a key role in providing the incentives to invent these kinds of securities. I don't really see any comparable interventions in the slave market, so it's tough to think what TTL motivation will be for the invention.
 
That, and insurance. Slaveholders are likely to take out life insurance for slaves (either as a package policy or for individuals of high value) about as soon as this becomes commercially available. You can generate a market based on that, too.

If you retain a lively overseas trade (unlikely), yopu could also have slave futures - purchasing cargoes on the sea and reselling, speculating on the extent of losses and sales prices at destination.
 
If you retain a lively overseas trade (unlikely), yopu could also have slave futures - purchasing cargoes on the sea and reselling, speculating on the extent of losses and sales prices at destination.

Honestly, you're talking about pools of unskilled labor for most slaves. That seems fungible enough (we pay a standard minimum wage for many jobs, after all) that there's no reason you couldn't have a market in pools of slaves.
 
Breeding stock like with horses?

Best Regards
Grey Wolf

No; the idea is that you speculate in the price of slaves, what demand for them will be like in a few years, etc.

The other thing you'd see more of is corporations which owned slaves. Awfully grimdark, I think.
 
But is there a futures market for breeding stock? I think that's what I meant. With horses, bulls etc, I could imagine there was SOME sort of speculative stock market out there. Maybe something similar might evolve with slaves, with regards to good studs and breeding females?

Best Regards
Grey Wolf
 
But is there a futures market for breeding stock? I think that's what I meant. With horses, bulls etc, I could imagine there was SOME sort of speculative stock market out there. Maybe something similar might evolve with slaves, with regards to good studs and breeding females?

Best Regards
Grey Wolf

Winning racehorses are syndicated. That is, people buy shares of said horse with the hopes of recouping their investment plus a profit. While race winnings are a portion of the returns, the majority of the profits come after the horse is too old to run in the derby races (about 4 years of age for Triple Crown thoroughbreds). Stud fees and the sale of offspring brings in much more money overall, especially with the advent of frozen sperm and artificial insemination. Similar investments occur with regards to champion rodeo bulls. So yes there is a form of speculative investing with regards to livestock.

How does this relate to slavery? Many slaves, following the ACW, told of intentional breeding rooms and rape used to increase the slave population. While apologists have discounted these accounts, it is well known that many Upper South plantations made much of their money by raising and then selling excess slaves to the Deep South. Also, there were slave traders arriving in the US as late as 1858. These men were backed by wealthy investors in a manner very similar to the venture capitalism of today.

Given what a huge portion of Southern wealth the slave economy made up it is difficult for me to think that some form of futures market would not arise. Slaves were a store of value, slaves were collateral, slaves were investments and slaves were relatively transportable. Most likely the primary reason a more structured investment market did not yet exist was due to the inadequacy of the Southern banking system and the ruralness of the plantation system. I would imagine that had the South won its independence an exchange and futures market would have arisen for slaves like most other commodities.

Benjamin
 
Slaves could easily be made part of the commodities market, since they were marketed as commodities. This doesn't even require a revived trans-atlantic slave trade. Even internally there was a vigorous interstate market in Southern slaves. The northern tier of slave-owning states had organized buyers who advertised, etc., and led coffers of purchased slaves south every year.

Commodity futures are basically a form of price insurance. Slaves as a commodity aren't going to be traded or in demand as often as real commodities like foodstuffs or oil, since a big part of the economic basis for slavery was labor stability (slavery is also a form of labor price insurance, in a way).

In a big area like the South, you'll probably have enough of a demand for slaves for a futures market to develop. Big plantations and factories will have a fairly predictable annual need for new slaves dues to "wastage" of their current slave workforce (accidents, deaths from old age or being worked to death, the occasional execution pour encourager les autres, escapes, disease, death from natural causes) and they'll probably want those slaves at predictable prices. So you'd have the conceptual basis for a futures market.

However, you don't get a demand for price insurance unless there are serious and unpredictable price swings to insure against. Is that really going to be the case with the slave market? I think it depends on whether there is a trans-atlantic slave trade or not. If there isn't, as the internal slave market develops, you're going to get fairly accurate actuarial and demographic information that are going to let you know just about how many slaves will be coming onto the market in anyone year. You have a predictable supply, that means that the price is going to be fairly predictable. Which means that there is no need for price insurance, so no real futures market. Contrast this with foodstuffs, where weather dramatically affects supply in unpredictable ways.

Thinking about slavery wedded to more sophisticated financial instruments leads to some weird results. Slaves are probably gonna be insured, which probably means that health and safety regulations and even employer-provided rudimentary medical care come to the South first, imposed by insurers. The demand for new slaves could and probably will mean horrible breeding experiment factories, but the cost of raising children to adulthood is large enough that my guess is that the standard model for breeding operations will be sharecropping/tenant farming/subsistence agriculture where the master supplies milk and vaccinations to the children. And then sells them away from home when they turn 16. In other words, a horrible parody of an early social welfare state.
 
The other option is instead of investing in the slaves, you invest in the infrastructure to create more. I.e. investing in the ships, rather than the slaves. Similar to the existing Spice trade from the Mideast in the 'Dark Ages'. This way investors can take advantage of existing legislation, instead of trying to create their own. They could also invest in the appropriate 'breeding camps', where the ones that produce more/better slaves get better rates of return (quantity/quality).

As to breeding slaves, the problem is it takes too long to see how the investment will return. Horses are easy in that over a twenty-year human investment lifespan, you can see five generations of horse grow up.

So investments in the ships/slaving groups in Africa would be the most likely place to occur.
 
Thinking about slavery wedded to more sophisticated financial instruments leads to some weird results. Slaves are probably gonna be insured, which probably means that health and safety regulations and even employer-provided rudimentary medical care come to the South first, imposed by insurers. The demand for new slaves could and probably will mean horrible breeding experiment factories, but the cost of raising children to adulthood is large enough that my guess is that the standard model for breeding operations will be sharecropping/tenant farming/subsistence agriculture where the master supplies milk and vaccinations to the children. And then sells them away from home when they turn 16. In other words, a horrible parody of an early social welfare state.

That reminds me of the horrors that go on in puppy mills. The very first thing I thought when I read that was "puppy mills, but with people". Thanks for putting such lovely thoughts into my head.
 
As to breeding slaves, the problem is it takes too long to see how the investment will return. Horses are easy in that over a twenty-year human investment lifespan, you can see five generations of horse grow up.

It depends on horrible you want to go before you assume the South or Brazil or whomever puts the humanitarian brakes on.

If there is a market in adult slaves, then there should be market in youth and children too. Slave crèche businesses or something that specialize in raising useful slaves cheaply and are maybe collocated with small factories that can use child labor in ways that aren't too destructive of the child slave. So slave 'breeders' should be able to get a return right away by selling toddlers or five-year olds or whatnot to crèches. In fact, putting very old slaves to raising young slaves would probably be a profitable way of extracting value from the old when they are no longer able to work hard.
 
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