6 ideas
An asset becomes capital when law grants it four attributes: priority (stronger claims than competing creditors), durability (protection from creditors and dissolution over time), universality (enforceability against the whole world, not just contracting parties), and convertibility (the right to exit into state money on demand). Assets holding these modules generate wealth for their holders.
The value an asset gives its holder depends on how the claim to it is legally coded, not on the asset itself. A plot of land held under customary use rights can be seized. The same land coded as registered title, pledged as collateral, or placed in a trust can be borrowed against and shielded from creditors. So differences in wealth track differences in legal coding as much as differences in holdings.
Capital is coded mostly by private lawyers who adapt the old modules of contract, property, collateral, trust, corporate and bankruptcy law for their clients. They do this largely without legislative approval, yet the results are backed by state enforcement. Lawyers choose among jurisdictions and test the limits of existing law, so the frontier of wealth creation is pushed in private offices.
Maya communities in southern Belize used their land under customary tenure, while the state granted logging and oil concessions over it to outsiders. The Maya won recognition of their customary rights in court. The ruling showed how undocumented communal use loses out to state-backed formal title, and how hard it is to turn recognized rights into rights enforceable against the world.
Global capital does not need a global state. It needs a few legal systems, chiefly English and New York law, that other countries' courts will recognize and enforce through choice-of-law rules. Asset holders can pick the most favorable code wherever they are. Domestic democratic control over how wealth is created weakens as a result.
Capital's legal privileges are enforced strictly in good times. In a crisis, the state faces a choice: enforce contracts and let the system collapse, or suspend the rules to rescue key holders. Because failure would be systemic, it bends the law and supplies liquidity to those at the apex, as in the 2008 bailouts. The result is that the best-coded claims are protected against both the market and the law.