The big financial question that every econo-blogger must be aware of is: how come that the proportion in profits in the economy as the whole that the financial industry was taking was constantly increasing all the past few decades and yet this same financial industry became the epicenter of the systemic crisis we are in now? The forces in play First of all, if something is happening, there should be a driving force. Not just greed, banksters were greedy for the last 3,000 years. It should be something more. As it would take me much more than one blog post to dig into details I’ll just give some few simple answers and leave the details for the future. Obviously, if it is really obvious, the driving force is the real economy, not the financial sector itself. But the problem is that the real economy is the chaos of disorganized actors while the financial industry is the gang of people who graduated from few selected Ivy-league schools and pretty much know each other. They are taking the advantage of the force coming from the real sector and use it for their own profit. The major force is that the growing global economy is demanding the monetary […]
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