Global Economic News and Analysis
According to the classical economists David Ricardo, John Stuart Mill and others, there are three components of capitalistic economies: land, labor capital and financial capital. In this article we will focus on the second and the third. Here are two interesting graphics from chartoftheday.com which give two factoids: The inflation adjusted value of the S&P 500 …
Continue reading “Stocks and Employment: Long-term Relationships”
Private investment is low. Executives are conflicted: They regretted missed investment opportunities and yet they also had risk averse attitudes. Productivity is falling off a cliff with no dividend to labor as well.
Reversing the robotic gigantism of banking ought to be the top priority for reform. Bankers were once supposed to know every borrower, and to make case-by-case lending decisions. Now, however, banks use models conjured up by faraway financial wizards to mass-produce credit and a range of derivative products. Mass-production favors the growth of mega-banks, so, unlike the misjudgments of lending officers, these behemoths’ defective models have had disastrous consequences.