Re:Finance is Not the Economy
by bawana on Sunday September 25, 2016 @08:36PM
(#12578329)
Money needs to be classified into two types- money derived from financial transactions and money derived from stuff - the exchange of goods/services. 'Financial' money should only be used for stuff. Only 'stuff' money should be used for finance. This would avoid the uncontrolled feedback loop that leads to financial money revving itself into a massive force that exceeds the real world on which it should be based.
[ Parent
| on HN ]
Why should money be derived from financial transactions in the first place? It is just electric bits going across the internet
It's a lot more than electric bits. Banks and other financial institutions allocate capital in the economy. By efficiently and effectively injecting capital into the right companies/sectors, the economy and standard of living will be drastically improved. It is in our best interest that it is the smartest and brightest making these decisions. Of course they should be compensated for these incredibly important services they provide.
But that was my point. Financial institutions USED TO inject capital into companies. Now they inject MOST of their capital into other financial instruments. Their 'investments' are actually just wagers - bets - because nothing is ACTUALLY manufactured and people are not actually serviced. Financial institutions should be outlawed from 'investing' money in any other financial institution or instrument.