Financial Sector Quotes

The words consent of the governed have become an empty phrase. Our textbooks on political science and economics are obsolete. Our nation has been hijacked by oligarchs, corporations, and a narrow, selfish, political, and economic elite, a small and privileged group that governs, and often steals, on behalf of moneyed interests. This elite, in the name of patriotism and democracy, in the name of all the values that were once part of the American system and defined the Protestant work ethic, has systematically destroyed our manufacturing sector, looted the treasury, corrupted our democracy, and trashed the financial system. During this plundering we remained passive, mesmerized by the enticing shadows on the wall, assured our tickets to success, prosperity, and happiness were waiting around the corner.

Oh, and 13.1 million American people had their homes foreclosed. Because their debt, it turns out, was real; it was only the debt within the financial sector that was imaginary. It was only the people who generated the crisis who got three magical wishes from an economic genie. There was no abracadabra for ordinary people; they just got abraca-fucked.

Something is profoundly wrong with the way we live today. For thirty years we have made a virtue out of the pursuit of material self-interest: indeed, this very pursuit now constitutes whatever remains of our sense of collective purpose. We know what things cost but have no idea what they are worth. We no longer ask of a judicial ruling or a legislative act: Is it good? Is it fair? Is it just? Is it right? Will it help bring about a better society or a better world? Those used to be the political questions, even if they invited no easy answers. We must learn once again to pose them. The materialistic and selfish quality of contemporary life is not inherent in the human condition. Much of what appears "natural" today dates from the 1980s: the obsession with wealth creation, the cult of privatization and the private sector, the growing disparities of rich and poor. And above all, the rhetoric that accompanies these: uncritical admiration for unfettered markets, disdain for the public sector, the delusion of endless growth. We cannot go on living like this. The little crash of 2008 was a reminder that unregulated capitalism is its own worst enemy: sooner or later it must fall prey to its own excesses and turn again to the state for rescue. But if we do no more than pick up the pieces and carry on as before, we can look forward to greater upheavals in years to come.

The divine line "Bitcoin/Cryptocurrency is for criminals" is a cunning defensive strategy created by so called traditional financial services sector.

The financial sector provides ample rewards for those who agree with them: lucrative consultancies, research grants, and the like. The documentary raises a question: Could this have influenced some economists’ judgments?

I could hear a gaggle of Americans, couples, laughing, saying their loud goodbyes as they parted for their respective rooms: old college friends, jobs in the financial sector, five-plus years of corporate law and Fiona entering the first grade in the fall, all's well in Oaklandia, well goodnight then, God we love you guys, a life I might have had myself except I didn't want it.

Almost as an article of faith, some individuals believe that conspiracies are either kooky fantasies or unimportant aberrations. To be sure, wacko conspiracy theories do exist. There are people who believe that the United States has been invaded by a secret United Nations army equipped with black helicopters, or that the country is secretly controlled by Jews or gays or feminists or black nationalists or communists or extraterrestrial aliens. But it does not logically follow that all conspiracies are imaginary. Conspiracy is a legitimate concept in law: the collusion of two or more people pursuing illegal means to effect some illegal or immoral end. People go to jail for committing conspiratorial acts. Conspiracies are a matter of public record, and some are of real political significance. The Watergate break-in was a conspiracy, as was the Watergate cover-up, which led to Nixon’s downfall. Iran-contra was a conspiracy of immense scope, much of it still uncovered. The savings and loan scandal was described by the Justice Department as “a thousand conspiracies of fraud, theft, and bribery,” the greatest financial crime in history. Often the term “conspiracy” is applied dismissively whenever one suggests that people who occupy positions of political and economic power are consciously dedicated to advancing their elite interests. Even when they openly profess their designs, there are those who deny that intent is involved. In 1994, the officers of the Federal Reserve announced they would pursue monetary policies designed to maintain a high level of unemployment in order to safeguard against “overheating” the economy. Like any creditor class, they preferred a deflationary course. When an acquaintance of mine mentioned this to friends, he was greeted skeptically, “Do you think the Fed bankers are deliberately trying to keep people unemployed?” In fact, not only did he think it, it was announced on the financial pages of the press. Still, his friends assumed he was imagining a conspiracy because he ascribed self-interested collusion to powerful people. At a World Affairs Council meeting in San Francisco, I remarked to a participant that U.S. leaders were pushing hard for the reinstatement of capitalism in the former communist countries. He said, “Do you really think they carry it to that level of conscious intent?” I pointed out it was not a conjecture on my part. They have repeatedly announced their commitment to seeing that “free-market reforms” are introduced in Eastern Europe. Their economic aid is channeled almost exclusively into the private sector. The same policy holds for the monies intended for other countries. Thus, as of the end of 1995, “more than $4.5 million U.S. aid to Haiti has been put on hold because the Aristide government has failed to make progress on a program to privatize state-owned companies” (New York Times 11/25/95). Those who suffer from conspiracy phobia are fond of saying: “Do you actually think there’s a group of people sitting around in a room plotting things?” For some reason that image is assumed to be so patently absurd as to invite only disclaimers. But where else would people of power get together – on park benches or carousels? Indeed, they meet in rooms: corporate boardrooms, Pentagon command rooms, at the Bohemian Grove, in the choice dining rooms at the best restaurants, resorts, hotels, and estates, in the many conference rooms at the White House, the NSA, the CIA, or wherever. And, yes, they consciously plot – though they call it “planning” and “strategizing” – and they do so in great secrecy, often resisting all efforts at public disclosure. No one confabulates and plans more than political and corporate elites and their hired specialists. To make the world safe for those who own it, politically active elements of the owning class have created a national security state that expends billions of dollars and enlists the efforts of vast numbers of people.

As a predatory competition for hoarding profit, neoliberalism produces massive inequality in wealth and income, shifts political power to financial elites, destroys all vestiges of the social contract, and increasingly views “unproductive” sectors—most often those marginalized by race, class, disability, resident status, and age—as suspicious, potentially criminal, and ultimately disposable. It thus criminalizes social problems and manufactures profit by commercializing surveillance, policing, and prisons.

The gap between financial capital of US$190 trillion looking for highly profitable investment opportunities and a real economy and social sector without access to the financial capital needed to operate and grow is at the heart of the worldwide economic crisis.

A stock screening feature is then used to find the leading stocks within the leading sectors.

Achieving such deep and liquid markets requires large-scale financial sector reforms, with a complete replacement of the existing regulatory framework.

Of course, there’s no clear line between who creates wealth and who shifts it. Lots of jobs do both. There’s no denying that the financial sector can contribute to our wealth and grease the wheels of other sectors in the process. Banks can help to spread risks and back people with bright ideas. And yet, these days, banks have become so big that much of what they do is merely shuffle wealth around, or even destroy it. Instead of growing the pie, the explosive expansion of the banking sector has increased the share it serves itself.4 Or take the legal profession. It goes without saying that the rule of law is necessary for a country to prosper. But now that the U.S. has seventeen times the number of lawyers per capita as Japan, does that make American rule of law seventeen times as effective?5 Or Americans seventeen times as protected? Far from it. Some law firms even make a practice of buying up patents for products they have no intention of producing, purely to enable them to sue people for patent infringement. Bizarrely, it’s precisely the jobs that shift money around – creating next to nothing of tangible value – that net the best salaries. It’s a fascinating, paradoxical state of affairs. How is it possible that all those agents of prosperity – the teachers, the police officers, the nurses – are paid so poorly, while the unimportant, superfluous, and even destructive shifters do so well?

In 1980, the wage of a worker in the financial sector was roughly comparable to the wages of workers with the same qualifications in other sectors. By 2006, a person in the financial sector was making 70 percent more.

In a move that will remain in Irish annals as a stigma comparable to the potato famine, the Dublin government succumbed to ECB blackmail: make the German creditors of Ireland’s commercial banks whole, even a bank that was closed down and thus no longer systemically important for Ireland’s financial sector, or else.

Financial organizations are looking into how blockchain technology could benefit the settlement, clearing, and insurance sectors.

The economic crisis and subsequent bailout exacerbated inequality by every metric and did not lead to significant reform of the financial sector. Bailed-out banks continued to foreclose on the homes of working-class families while refusing to make new loans to creditworthy borrowers. Under an Ivy League–educated African American president, African American family wealth had collapsed. In fact, it is common knowledge that African American and Latino homeowners were hit hardest by the 2008 financial crisis: by 2018, an African American family owned $5.00 in assets for every $100.00 owned by white families.6 Obama’s identity politics did not translate into economic policies that benefited minorities and working-class people.

The motivation for taking on debt is to buy assets or claims rising in price. Over the past half-century the aim of financial investment has been less to earn profits on tangible capital investment than to generate “capital” gains (most of which take the form of debt-leveraged land prices, not industrial capital). Annual price gains for property, stocks and bonds far outstrip the reported real estate rents, corporate profits and disposable personal income after paying for essential non-discretionary spending, headed by FIRE [Finance, Insurance, Real Estate]-sector charges.

Putin isn’t a full-blown Fascist because he hasn’t felt the need. Instead, as prime minister and president, he has flipped through Stalin’s copy of the totalitarian playbook and underlined passages of interest to call on when convenient. Throughout his time in office, he has stockpiled power at the expense of provincial governors, the legislature, the courts, the private sector, and the press. A suspicious number of those who have found fault with him have later been jailed on dubious charges or murdered in circumstances never explained. Authority within Putin’s “vertical state”—including directorship of the national oil and gas companies—is concentrated among KGB alumni and other former security and intelligence officials. A network of state-run corporations and banks, many with shady connections offshore, furnish financial lubricants for pet projects and privileged friends. Rather than diversify as China has done, the state has more than doubled its share of the national economy since 2005.

A modern, sophisticated financial sector...seeks ways to exploit government decency, whether it is the government's concern about inequality, unemployment, or the stability of the country's banks. The problem stems from the fundamental incompatibility between the goals of capitalism and those of democracy. And yet the two go together, because each of these systems softens the deficiencies of the other.

A more recent concern relates to “financialization” and associated short-termism. Financialization is the growing importance of norms, metrics, and incentives from the financial sector to the wider economy. Some of the concerns expressed are that, for example, managers are increasingly awarded stock options to align their incentives with those of shareholders; companies are often explicitly managed to increase short-term shareholder value; and financial engineering, such as share buybacks and earnings management, has become a more important part of senior managers’ jobs. The end result is that rather than finance serving business, business serves finance: the tail wags the dog. What John Kay described as “obliquity,” the idea that making money was a consequence of, or a second-order benefit of, serving one’s customers and building good businesses, is driven out (Kay 2010).

In fact, they are not taught in any university departments: the dynamics of debt, and how the pattern of bank lending inflates land prices, or national income accounting and the rising share absorbed by rent extraction in the Finance, Insurance and Real Estate (FIRE) sector. There was only one way to learn how to analyze these topics: to work for banks. Back in the 1960s there was barely a hint that these trends would become a great financial bubble.

The euro and the ECB were designed in a way that blocks government money creation for any purpose other than to support the banks and bondholders. Their monetary and fiscal straitjacket obliges the eurozone economies to rely on bank creation of credit and debt. The financial sector takes over the role of economic planner, putting its technicians in charge of monetary and fiscal policy without democratic voice or referendums over debt and tax policies.

The relentless buying, selling, insuring, and financing of their bodies and the products of their forced labor would help make Wall Street a thriving banking, insurance, and trading sector, and New York City a financial capital of the world.13

After the New Deal, economists began referring to America’s retirement-finance model as a “three-legged stool.” This sturdy tripod was composed of Social Security, private pensions, and combined investments and savings. In recent years, of course, two of those legs have been kicked out. Many Americans saw their assets destroyed by the Great Recession; even before the economic collapse, many had been saving less and less. And since the 1980s, employers have been replacing defined-benefit pensions that are funded by employers and guarantee a monthly sum in perpetuity with 401(k) plans, which often rely on employee contributions and can run dry before death. Marketed as instruments of financial liberation that would allow workers to make their own investment choices, 401(k)s were part of a larger cultural drift in America away from shared responsibilities toward a more precarious individualism. Translation: 401(k)s are vastly cheaper for companies than pension plans. “Over the last generation, we have witnessed a massive transfer of economic risk from broad structures of insurance, including those sponsored by the corporate sector as well as by government, onto the fragile balance sheets of American families,” Yale political scientist Jacob S. Hacker writes in his book The Great Risk Shift. The overarching message: “You are on your own.

The population is angry, frustrated, bitter—and for good reasons. For the past generation, policies have been initiated that have led to an extremely sharp concentration of wealth in a tiny sector of the population. In fact, the wealth distribution is very heavily weighted by, literally, the top tenth of one percent of the population, a fraction so small that they’re not even picked up on the census. You have to do statistical analysis just to detect them. And they have benefited enormously. This is mostly from the financial sector—hedge fund managers, CEOs of financial corporations, and so on.

Economists who have studied financialization have found a strong correlation between the growth of the financial sector and inequality as well as the decline in labor’s share of national income.55 Since the financial sector is, in effect, imposing a kind of tax on the rest of the economy and then reallocating the proceeds to the top of the income distribution, it’s reasonable to conclude that it has played a role in a number of the trends we’ve looked at. Still, it seems hard to make a strong case for financialization as the primary cause of, say, polarization and the elimination of routine jobs.

Private sector networks in the United States, networks operated by civilian U.S. government agencies, and unclassified U.S. military and intelligence agency networks increasingly are experiencing cyber intrusions and attacks,” said a U.S.-China Economic and Security Review Commission report to Congress that was published the same month Conficker appeared. “. . . Networks connected to the Internet are vulnerable even if protected with hardware and software firewalls and other security mechanisms. The government, military, businesses and economic institutions, key infrastructure elements, and the population at large of the United States are completely dependent on the Internet. Internet-connected networks operate the national electric grid and distribution systems for fuel. Municipal water treatment and waste treatment facilities are controlled through such systems. Other critical networks include the air traffic control system, the system linking the nation’s financial institutions, and the payment systems for Social Security and other government assistance on which many individuals and the overall economy depend. A successful attack on these Internet-connected networks could paralyze the United States [emphasis added].

It was during the 1970s that statisticians decided it would be a good idea to measure banks’ “productivity” in terms of their risk-taking behavior. The more risk, the bigger their slice of the GDP.14 Hardly any wonder, then, that banks have continually upped their lending, egged on by politicians who have been convinced that the financial sector’s slice is every bit as valuable as the whole manufacturing industry. “If banking had been subtracted from the GDP, rather than added to it,” the Financial Times recently reported, “it is plausible to speculate that the financial crisis would never have happened.”15 The CEO who recklessly hawks mortgages and derivatives to lap up millions in bonuses currently contributes more to the GDP than a school packed with teachers or a factory full of car mechanics. We live in a world where the going rule seems to be that the more vital your occupation (cleaning, nursing, teaching), the lower you rate in the GDP. As the Nobel laureate James Tobin said back in 1984, “We are throwing more and more of our resources, including the cream of our youth, into financial activities remote from the production of goods and services, into activities that generate high private rewards disproportionate to their social productivity.”16

The history of black workers in the United States illustrates the point. As already noted, from the late nineteenth-century on through the middle of the twentieth century, the labor force participation rate of American blacks was slightly higher than that of American whites. In other words, blacks were just as employable at the wages they received as whites were at their very different wages. The minimum wage law changed that. Before federal minimum wage laws were instituted in the 1930s, the black unemployment rate was slightly lower than the white unemployment rate in 1930. But then followed the Davis-Bacon Act of 1931, the National Industrial Recovery Act of 1933 and the Fair Labor Standards Act of 1938—all of which imposed government-mandated minimum wages, either on a particular sector or more broadly. The National Labor Relations Act of 1935, which promoted unionization, also tended to price black workers out of jobs, in addition to union rules that kept blacks from jobs by barring them from union membership. The National Industrial Recovery Act raised wage rates in the Southern textile industry by 70 percent in just five months and its impact nationwide was estimated to have cost blacks half a million jobs. While this Act was later declared unconstitutional by the Supreme Court, the Fair Labor Standards Act of 1938 was upheld by the High Court and became the major force establishing a national minimum wage. As already noted, the inflation of the 1940s largely nullified the effect of the Fair Labor Standards Act, until it was amended in 1950 to raise minimum wages to a level that would have some actual effect on current wages. By 1954, black unemployment rates were double those of whites and have continued to be at that level or higher. Those particularly hard hit by the resulting unemployment have been black teenage males. Even though 1949—the year before a series of minimum wage escalations began—was a recession year, black teenage male unemployment that year was lower than it was to be at any time during the later boom years of the 1960s. The wide gap between the unemployment rates of black and white teenagers dates from the escalation of the minimum wage and the spread of its coverage in the 1950s. The usual explanations of high unemployment among black teenagers—inexperience, less education, lack of skills, racism—cannot explain their rising unemployment, since all these things were worse during the earlier period when black teenage unemployment was much lower. Taking the more normal year of 1948 as a basis for comparison, black male teenage unemployment then was less than half of what it would be at any time during the decade of the 1960s and less than one-third of what it would be in the 1970s. Unemployment among 16 and 17-year-old black males was no higher than among white males of the same age in 1948. It was only after a series of minimum wage escalations began that black male teenage unemployment not only skyrocketed but became more than double the unemployment rates among white male teenagers. In the early twenty-first century, the unemployment rate for black teenagers exceeded 30 percent. After the American economy turned down in the wake of the housing and financial crises, unemployment among black teenagers reached 40 percent.

The Rothschilds are people we certainly would not attempt to defend given the rumors swirling around them of financial corruption and market manipulation in this era and in earlier eras. However, the way they are held up, by conspiracy extremists and other paranoid thinkers, to represent the Jewish community is an absolute joke. There are good and bad people in all races. The fact that there are many Jews in the banking sector is being used by neo-Nazis and anti-Semites to try to sway the uneducated to believe the Jews are the problem instead of banking shysters and banksters in general. Another important point relating to the current Jewish prominence in the banking world is there is a very obvious historical reason for it...Historically Jews did not have much freedom of choice when it came to their occupations. In fact, they were once forbidden by Christian authorities, and by some Muslim authorities, to pursue most regular occupations. They were, however, permitted and even encouraged to enter the banking industry because, in the medieval era at least, Christians/Muslims were not allowed to charge fellow-Christians/Muslims interest, but someone had to make loans – so the Jews were charged with the task. Jews were also permitted to slaughter animals – another equally unsavory job – and they were then despised and mocked by entire communities for being animal slaughterers and bankers.

Bill Clinton’s political formula for seizing the presidency was simple. He made money tight in the ghettos and let it flow free on Wall Street. He showered the projects with cops and bean counters and pulled the cops off the beat in the financial services sector. And in one place he created vast new mountain ranges of paperwork, while in another, paperwork simply vanished.

The air, soil and water cumulatively degrade; the climates and oceans destabilize; species become extinct at a spasm rate across continents; pollution cycles and volumes increase to endanger life-systems at all levels in cascade effects; a rising half of the world is destitute as inequality multiplies; the global food system produces more and more disabling and contaminated junk food without nutritional value; non-contagious diseases multiply to the world’s biggest killer with only symptom cures; the vocational future of the next generation collapses across the world while their bank debts rise; the global financial system has ceased to function for productive investment in life-goods; collective-interest agencies of governments and unions are stripped while for-profit state subsidies multiply; police state laws and methods advance while belligerent wars for corporate resources increase; the media are corporate ad vehicles and the academy is increasingly reduced to corporate functions; public sectors and services are non-stop defunded and privatized as tax evasion and transnational corporate funding and service by governments rise at the same time at every level.

The inevitable consequence is that the wealthy become dominant. The wealthy set their own pay or the company boards pay very generously. Each company board, in hiring a new CEO, feels it must pay as much or more than the competitive companies pay their CEO, rather than using the firm’s earnings or share price or some other yardstick. In many sectors, especially in the financial sector, there is more collusion than real competition. The wealthy see their pay as describing their worth, and they rely on their wealth and political influence to defeat democratic measures to contain or tax them sufficiently. Democracy is therefore in danger of being destroyed by capitalism. Unless there is higher taxation on wealth and more regulation to promote real competition, democracy is subverted.8

From the moneyless economics of the classical school there evolved modern, orthodox macroeconomics: the science of monetary society taught in universities and deployed by central banks. From the practitioners’ economics of Bagehot, meanwhile, there evolved the academic discipline of finance—the tools of the trade taught in business schools, used by bankers and bond traders. One was an intellectual framework for understanding the economy without money, banks, and finance. The other was a framework for understanding money, banks, and finance, without the rest of the economy. The result of this intellectual apartheid was that when in 2008 a crisis in the financial sector caused the biggest macroeconomic crash in history, and when the economy failed to recover afterwards because the banking sector was broken, neither modern macroeconomics nor modern finance could make head nor tail of it.

More than half of the Danish adult population—as much as two-thirds, according to some estimates—either works in the public sector or is financially supported by it in the form of benefit payments. The idea, then, of the Danes voting for a reduction in the size of the public sector funded by tax cuts seems about as likely as the turkeys voting for Thanksgiving. The majority will always vote for the status quo because their livelihood depends on it.

Detroit is an extreme example of the fact that public-sector employment has become in effect a supplementary welfare state, with salaries and benefits – and, above all, pensions – entirely disconnected from legitimate municipal purposes. Unionized public-sector employees with a high degree of political discipline fortified by narrow financial self-interest become an unstoppable constituency, and the government becomes its own special-interest group.

There is a misconception held by many Egyptian professionals, especially engineers, that informal housing is haphazardly constructed and liable to collapse. However, such precarious housing is almost unknown in informal areas. Since informal housing is overwhelmingly owner-built without use of formal contractors, it is in the owner’s own best interest to ensure that care is taken in construction. In fact, one of the main features of informal housing construction is its high structural quality, reflecting the substantial financial resources and tremendous efforts that owners devote to these buildings. It is worth noting that in the 1992 earthquake in Cairo, practically all building collapses and the resulting fatalities occurred not in informal areas, but either in dilapidated historic parts of the city or informal areas…where apartment blocks had been constructed by (sometimes) unscrupulous developers and contractors.

Estimates suggest that $7.6 trillion of wealth is hidden in tax havens all over the world. The international finance sector acts as a 'circulation system for criminal money acquired through drug trafficking, terrorism, piracy, human trafficking, proliferation and tax evasion.' When we look at the international financial system, we don't find a free-market paradise. Instead, we find incredibly powerful institutions in both the public and private sector shaping the conditions faced by everyone else. Financial institutions 'dress themselves up in liberal trappings of the market, yet capture the old sovereignty of the state all the better to squeeze the social body to feed their own profits.' Yet all this power is held without any democratic accountability. Politicians, technocrats, and financiers work together to decide everything from the interest rates we pay on our loans to who gets what when a state files for bankruptcy. If everyone had a say in determining how these rules were made and enforced, rather than just a privileged few, we'd live in a very different world.

In the United States, both of the dominant parties have shifted toward free-market capitalism. Even though analysis of roll call votes show that since the 1970s, Republicans have drifted farther to the right than Democrats have moved to the left, the latter were instrumental in implementing financial deregulation in the 1990s and focused increasingly on cultural issues such as gender, race, and sexual identity rather than traditional social welfare policies. Political polarization in Congress, which had bottomed out in the 1940s, has been rapidly growing since the 1980s. Between 1913 and 2008, the development of top income shares closely tracked the degree of polarization but with a lag of about a decade: changes in the latter preceded changes in the former but generally moved in the same direction—first down, then up. The same has been true of wages and education levels in the financial sector relative to all other sectors of the American economy, an index that likewise tracks partisan polarization with a time lag. Thus elite incomes in general and those in the finance sector in particular have been highly sensitive to the degree of legislative cohesion and have benefited from worsening gridlock.

Europe’s war against debtor countries was turning into class war, which always ends up being waged on the political battlefield. One financial analyst noted that the money raised for putting up islands and public buildings, ports and the water system for sale “will barely put a dint in Greece’s now-unpayable public debt.” Creditors simply hoped to take as much as they could, in the absence of public protests to stop the selloffs. That is why bankers resort to anti-democratic methods in opposing any political power independent of creditor interests. The aim is to centralize financial policy in the hands of “technocrats” drawn from the banking sector – not only Lucas Papademos in Greece, but also Mario Monti in Italy almost simultaneously (as described in the next chapter). The fear is that democratically elected officials will act “irresponsibly,” that is, in the interests of the economy at large rather than catering to the demands of banks and bondholders. The

I forgot the maid who works in my P.G. and struggles to make money, every day, who is in fear that one day her cruel husband will find her out eventually and beat her and her son to death. I forgot that auto driver I met on my way to M.G. road metro station, and who wanted to be in the army but gave up study due to the financial crisis. I forgot that security guard I met at IIT Delhi, and who was forced to leave the study and marry at the age of 15. I forgot those little kids I generally encounter at Railway stations and trains selling packets of pens @ Rs.25 per packet. I forgot that 75 years old ricksha wala I met in sector 23 market with only one eye and high power lens I forgot that washroom cleaning staff at my office who always welcomes me with a broad smile. I forgot the dead body of that martyred soldier I saw at the Kashmir airport, laden with garlands of marigold and people shouting," jawan amar rahe!" I forgot the scream of that pig near my office when a thick rope was brutally tied in its nose and it was forcefully taken by some people on a bike. I almost forgot everything!

The growth of international bureaucracies with power to determine many aspects of people’s lives is a dominant feature of our age. Even the European Union is increasingly powerless, as it merely transmits to its member states rules set at higher levels. Food standards, for example, are decided by a United Nations body called the Codex Alimentarius. The rules of the banking industry are set by a committee based in Basel in Switzerland. Financial regulation is set by the Financial Stability Board in Paris. I bet you have not heard of the World Forum for the Harmonisation of Vehicle Regulations, a subsidiary of the UN. Even the weather is to be controlled by Leviathan in the future. In an interview in 2012, Christiana Figueres, head of the United Nations Framework Convention on Climate Change, said she and her colleagues were inspiring government, private sector and civil society to make the biggest transformation that they have ever undertaken: ‘The Industrial Revolution was also a transformation, but it wasn’t a guided transformation from a centralized policy perspective. This is a centralized transformation.’ Yet

Many aspects of the modern financial system are designed to give an impression of overwhelming urgency: the endless ‘news’ feeds, the constantly changing screens of traders, the office lights blazing late into the night, the young analysts who find themselves required to work thirty hours at a stretch. But very little that happens in the finance sector has genuine need for this constant appearance of excitement and activity. Only its most boring part—the payments system—is an essential utility on whose continuous functioning the modern economy depends. No terrible consequence would follow if the stock market closed for a week (as it did in the wake of 9/11)—or longer, or if a merger were delayed or large investment project postponed for a few weeks, or if an initial public offering happened next month rather than this. The millisecond improvement in data transmission between New York and Chicago has no significance whatever outside the absurd world of computers trading with each other. The tight coupling is simply unnecessary: the perpetual flow of ‘information’ part of a game that traders play which has no wider relevance, the excessive hours worked by many employees a tournament in which individuals compete to display their alpha qualities in return for large prizes. The traditional bank manager’s culture of long lunches and afternoons on the golf course may have yielded more useful information about business than the Bloomberg terminal. Lehman

His great concern had to do with the fact that private fortunes were significantly outpacing investments in public services like schools, parks, and safety net programs. The process tends to begin gradually before accelerating under its own momentum. As people accumulate more money, they become less dependent on public goods and, in turn, less interested in supporting them. If they get their way, through tax breaks and other means, personal fortunes grow while public goods are allowed to deteriorate. As public housing, public education, and public transportation become poorer, they become increasingly, then almost exclusively, used only by the poor themselves.[6] People then begin to denigrate the public sector altogether, as if it were rotten at the root and not something the rich had found it in their interest to destroy. The rich and the poor soon unite in their animosity toward public goods—the rich because they are made to pay for things they don’t need and the poor because what they need has become shabby and broken. Things collectively shared, especially if they are shared across class and racial divides, come to be seen as lesser. In America, a clear marker of poverty is one’s reliance on public services, and a clear marker of affluence is one’s degree of distance from them. Enough money brings “financial independence,” which tellingly does not signal independence from work but from the public sector. There was a time when Americans wished to be free of bosses. Now we wish to be free of bus drivers. We wish for the freedom to withdraw from the wider community and sequester ourselves in a more exclusive one, pulling further and further away from the poor until the world they inhabit becomes utterly unrecognizable to us.[7]

KEYNESIAN ECONOMICS AND STIMULUS Keynesian economics is based on the notion that unemployment arises when total or aggregate demand in an economy falls short of the economy’s ability to supply goods and services. When products go unsold, jobs are lost. Aggregate demand, in turn, comes from two sources: the private sector (which is the majority) and the government. At times, aggregate demand is too buoyant—goods fly off the shelves and labor is in great demand—and we get rising inflation. At other times, aggregate demand is inadequate—goods are hard to sell and jobs are hard to find. In those cases, Keynes argued in the 1930s, governments can boost employment by cutting interest rates (what we now call looser monetary policy), raising their own spending, or cutting people’s taxes (what we now call looser fiscal policy). By the same logic, when there is too much demand, governments can fight actual or incipient inflation by raising interest rates (tightening monetary policy), increasing taxes, or reducing its own spending (thus tightening fiscal policy). That’s part of standard Keynesian economics, too, although Keynes, writing during the Great Depression, did not emphasize it. Setting aside the underlying theory, the central Keynesian policy idea is that the government can—and, Keynes argued, should—act as a kind of balance wheel, stimulating aggregate demand when it’s too weak and restraining aggregate demand when it’s too strong. For decades, American economists took for granted that most of that job should and would be done by monetary policy. Fiscal policy, they thought, was too slow, too cumbersome, and too political. And in the months after the Lehman Brothers failure, the Federal Reserve did, indeed, pull out all the stops—while fiscal policy did nothing. But what happens when, as was more or less the case by December 2008, the central bank has done almost everything it can, and yet the economy is still sinking? That’s why eyes started turning toward Congress and the president—that is, toward fiscal stimulus—after the 2008 election.

Obama is also directing the U.S. government to invest billions of dollars in solar and wind energy. In addition, he is using bailout leverage to compel the Detroit auto companies to build small, “green” cars, even though no one in the government has investigated whether consumers are interested in buying small, “green” cars—the Obama administration just believes they should. All these measures, Obama recognizes, are expensive. The cap and trade legislation is estimated to impose an $850 billion burden on the private sector; together with other related measures, the environmental tab will exceed $1 trillion. This would undoubtedly impose a significant financial burden on an already-stressed economy. These measures are billed as necessary to combat global warming. Yet no one really knows if the globe is warming significantly or not, and no one really knows if human beings are the cause of the warming or not. For years people went along with Al Gore’s claim that “the earth has a fever,” a claim illustrated by misleading images of glaciers disappearing, oceans swelling, famines arising, and skies darkening. Apocalypse now! Now we know that the main body of data that provided the basis for these claims appears to have been faked. The Climategate scandal showed that scientists associated with the Intergovernmental Panel on Climate Change were quite willing to manipulate and even suppress data that did not conform to their ideological commitment to global warming.3 The fakers insist that even if you discount the fakery, the data still show.... But who’s in the mood to listen to them now? Independent scientists who have reviewed the facts say that average global temperatures have risen by around 1.3 degrees Fahrenheit in the past 100 years. Lots of things could have caused that. Besides, if you project further back, the record shows quite a bit of variation: periods of warming, followed by periods of cooling. There was a Medieval Warm Period around 1000 A.D., and a Little Ice Age that occurred several hundred years later. In the past century, the earth warmed slightly from 1900 to 1940, then cooled slightly until the late 1970s, and has resumed warming slightly since then. How about in the past decade or so? Well, if you count from 1998, the earth has cooled in the past dozen years. But the statistic is misleading, since 1998 was an especially hot year. If you count from 1999, the earth has warmed in the intervening period. This statistic is equally misleading, because 1999 was a cool year. This doesn’t mean that temperature change is in the eye of the beholder. It means, in the words of Roy Spencer, former senior scientist for climate studies at NASA, that “all this temperature variability on a wide range of time scales reveals that just about the only thing constant in climate is change.”4

The Seventh Central Pay Commission was appointed in February 2014 by the Government of India (Ministry of Finance) under the Chairmanship of Justice Ashok Kumar Mathur. The Commission has been given 18 months to make its recommendations. The terms of reference of the Commission are as follows:  1. To examine, review, evolve and recommend changes that are desirable and feasible regarding the principles that should govern the emoluments structure including pay, allowances and other facilities/benefits, in cash or kind, having regard to rationalisation and simplification therein as well as the specialised needs of various departments, agencies and services, in respect of the following categories of employees:-  (i) Central Government employees—industrial and non-industrial; (ii) Personnel belonging to the All India Services; (iii) Personnel of the Union Territories; (iv) Officers and employees of the Indian Audit and Accounts Department; (v) Members of the regulatory bodies (excluding the RBI) set up under the Acts of Parliament; and (vi) Officers and employees of the Supreme Court.   2. To examine, review, evolve and recommend changes that are desirable and feasible regarding the principles that should govern the emoluments structure, concessions and facilities/benefits, in cash or kind, as well as the retirement benefits of the personnel belonging to the Defence Forces, having regard to the historical and traditional parties, with due emphasis on the aspects unique to these personnel.   3. To work out the framework for an emoluments structure linked with the need to attract the most suitable talent to government service, promote efficiency, accountability and responsibility in the work culture, and foster excellence in the public governance system to respond to the complex challenges of modern administration and the rapid political, social, economic and technological changes, with due regard to expectations of stakeholders, and to recommend appropriate training and capacity building through a competency based framework.   4. To examine the existing schemes of payment of bonus, keeping in view, inter-alia, its bearing upon performance and productivity and make recommendations on the general principles, financial parameters and conditions for an appropriate incentive scheme to reward excellence in productivity, performance and integrity.   5. To review the variety of existing allowances presently available to employees in addition to pay and suggest their rationalisation and simplification with a view to ensuring that the pay structure is so designed as to take these into account.   6. To examine the principles which should govern the structure of pension and other retirement benefits, including revision of pension in the case of employees who have retired prior to the date of effect of these recommendations, keeping in view that retirement benefits of all Central Government employees appointed on and after 01.01.2004 are covered by the New Pension Scheme (NPS).   7. To make recommendations on the above, keeping in view:  (i) the economic conditions in the country and the need for fiscal prudence; (ii) the need to ensure that adequate resources are available for developmental expenditures and welfare measures; (iii) the likely impact of the recommendations on the finances of the state governments, which usually adopt the recommendations with some modifications; (iv) the prevailing emolument structure and retirement benefits available to employees of Central Public Sector Undertakings; and (v) the best global practices and their adaptability and relevance in Indian conditions.   8. To recommend the date of effect of its recommendations on all the above.

the size of the financial industry in the US had risen astronomically to reach nearly 8 per cent of GDP by 2009. (That was partly the result of changes in how banking was measured.) Yet a bigger banking sector, as we subsequently discovered, was not necessarily a good thing. Much of its size owed to an increasing capacity to generate “sophisticated” products, some of which turned out to be toxic.

Halo Effect Cisco, the Silicon Valley firm, was once a darling of the new economy. Business journalists gushed about its success in every discipline: its wonderful customer service, perfect strategy, skilful acquisitions, unique corporate culture and charismatic CEO. In March 2000, it was the most valuable company in the world. When Cisco’s stock plummeted 80% the following year, the journalists changed their tune. Suddenly the company’s competitive advantages were reframed as destructive shortcomings: poor customer service, a woolly strategy, clumsy acquisitions, a lame corporate culture and an insipid CEO. All this – and yet neither the strategy nor the CEO had changed. What had changed, in the wake of the dot-com crash, was demand for Cisco’s product – and that was through no fault of the firm. The halo effect occurs when a single aspect dazzles us and affects how we see the full picture. In the case of Cisco, its halo shone particularly bright. Journalists were astounded by its stock prices and assumed the entire business was just as brilliant – without making closer investigation. The halo effect always works the same way: we take a simple-to-obtain or remarkable fact or detail, such as a company’s financial situation, and extrapolate conclusions from there that are harder to nail down, such as the merit of its management or the feasibility of its strategy. We often ascribe success and superiority where little is due, such as when we favour products from a manufacturer simply because of its good reputation. Another example of the halo effect: we believe that CEOs who are successful in one industry will thrive in any sector – and furthermore that they are heroes in their private lives, too.

Some of the world’s biggest banks and investor groups have swung behind a pledge to raise $200bn by the end of next year to combat climate change. In a move the UN said was unprecedented, leading insurers, pension funds and banks have joined forces to help channel the money to projects that will help poorer countries deal with the effect of global warming and cut reliance on fossil fuels. The announcement came at the start of a UN climate summit in New York aimed at bolstering momentum for a global agreement to lower planet-warming greenhouse gas emissions due to be signed in Paris at the end of 2015. “Change is in the air,” said UN secretary-general, Ban Ki-moon. “Today’s climate summit has shown an entirely new, co-operative global approach to climate change.” The summit opened with business and government pledges to make cities greener, create a renewable energy “corridor” in Africa and rein in the clearing of forests for palm oil plantations. The private sector’s contributions marked a “major departure” from past climate summits, the UN said, adding in a statement that financial groups “had never previously acted together on climate change at such a large scale”. One obstacle to the Paris agreement is developing countries’ insistence that richer nations must fulfil pledges made nearly five years ago to raise $100bn a year by 2020 for climate action.

Over the past quarter century, the leaders of both the Democratic and the Republican political parties have perfected a remarkable system for remaining in power while serving the new economic oligarchy. Both parties take in huge amounts of money, in many forms — campaign contributions, lobbying, revolving-door hiring, favours, and special access of various kinds. Politicians in both parties enrich themselves and betray the interests of the nation, including most of the people who vote for them. Yet both parties are still able to mobilize support because they skilfully exploit America’s cultural polarization. Republicans warn social conservatives about the dangers of secularism, taxes, abortion, welfare, gay marriage, gun control, and liberals. Democrats warn social liberals about the dangers of guns, pollution, global warming, making abortion illegal, and conservatives. Both parties make a public show of how bitter their conflicts are, and how dangerous it would be for the other party to achieve power, while both prostitute themselves to the financial sector, powerful industries, and the wealthy. Thus, the very intensity of the two parties’ differences on “values” issues enables them to collaborate when it comes to money.

And yet despite these shifts in employment patterns, most brand-name retail, service and restaurant chains have opted to put on economic blinders, insisting that they are still offering hobby jobs for kids. Never mind that the service sector is now filled with workers who have multiple university degrees, immigrants unable to find manufacturing jobs, laid-off nurses and teachers, and downsized middle managers. Never mind, too, that the students who do work in retail and fast food — as many of them do - are facing higher tuition costs, less financial assistance from parents and government and more years in school. Never mind that the food service workforce has been steadily aging over the last decade so that more than half are now over twenty-five years old. Or that a 1997 study found that 25 percent of non-management Canadian retail workers had been with the same company for eleven years or more and that 39 percent had been there for between four and ten years. That's a lot longer than "Chainsaw" Al Dunlap lasted as CEO of Sunbeam Corp. But never mind all that. Everyone knows that a job in the service sector is a hobby, and retail is a place where people go for "experience," not a livelihood.

If we are going to avoid similar financial crises in the future, we need to restrict severely freedom of action in the financial market. Financial instruments need to be banned unless we fully understand their workings and their effects on the rest of the financial sector and, moreover, the rest of the economy. This will mean banning many of the complex financial derivatives whose workings and impacts have been shown to be beyond the comprehension of even the supposed experts. You may think I am too extreme. However, this is what we do all the time with other products – drugs, cars, electrical products, and many others. When a company invents a new drug, for example, it cannot be sold immediately. The effects of a drug, and the human body’s reaction to it, are complex. So the drug needs to be tested rigorously before we can be sure that it has enough beneficial effects that clearly overwhelm the side-effects and allow it to be sold.

Most bank loans are geared not to produce goods and services, but to transfer ownership rights for real estate, stocks (including those of entire companies) and bonds. This has led national income theorists to propose treating the revenue of such institutions as transfer payments, not payments for producing output or “product.” Australian economist Bryan Haig has called this “the banking problem.” “If financial services were treated like other industries,” he writes, “the banking sector as a whole would be depicted as making a negligible, or perhaps even negative, contribution to national economic output as being, effectively, unproductive.

The Federal Reserve Bank of Richmond has estimated that 61 percent of all private-sector financial liabilities are guaranteed by the federal government, either explicitly or implicitly. As recently as 1999, this figure was below 50 percent.

Private industry doesn’t have the financial wherewithal to weather the risks that basic research imposes—namely, that a lot of it is wasted looking in the wrong places because of the trial-and-error nature of observational science. But when basic research hits, it hits big, creating entire new economies and transformative breakthroughs. We can’t afford not to do basic research. The only thing we can be sure of is that, if we don’t do it, we won’t get the breakthroughs that solve global problems or make trillions of dollars. The private sector is timid by comparison, Mazzucato argues. It’s the public sector that can be a catalyst for big, bold, problem-solving ideas, which is why the argument for science and democracy is so essential.

His order cited "credible evidence" that a takeover "threatens to impair the national security of the US".Qualcomm was already trying to fend off Broadcom's bid.The deal would have created the world's third-largest chipmaker behind Intel and Samsung.It would also have been the biggest takeover the technology koo50 sector had ever seen.The presidential order said: "The proposed takeover of Qualcomm by the Purchaser (Broadcom) is prohibited. and any substantially equivalent merger. acquisition. or takeover. whether effected directly or indirectly. is also prohibited."Crown jewelSome analysts said President Trump's decision was more about competitiveness and winning the race for 5G technology. than security concerns.The sector is in a race to develop chips for the latest 5G wireless technology. and Qualcomm was considered by Broadcom a significant asset in its bid to gain market share.Image captionQualcomm has already showcased 1Gbps mobile internet speeds using a 5G chip"Given the current political climate in the US and other regions around the world. everyone is taking a more conservative view on mergers and acquisitions and protecting their own domains." IDC's Mario Morales. vice president of enabling technologies and semiconductors told the BBC."We are all at the start of a race. and you have 5G as a crown jewel that everyone wants to participate in - and every region is racing towards that." he said."We don't want to hinder someone like Qualcomm so that they can't provide the technology to the vendors that are competing within that space."US investigates Broadcom's Qualcomm bidQualcomm rejects Broadcom takeover bidHuawei's US smartphone deal collapsesSingapore-based Broadcom had been pursuing San Diego-based Qualcomm for about four months.Last week however. Broadcom's hostile takeover bid was put under investigation by the Committee on Foreign Investment in the US. a multi-agency led by the US Treasury Department.The US company had rejected approaches from its rival on the grounds that the offer undervalued the business. and also that any takeover would face antitrust hurdles.Earlier this year. Chinese telecoms giant Huawei said it had not been able to strike a deal to sell its new smartphone via a US carrier. widely believed to be AT&T.The US also recently blocked the $1.2bn sale of money transfer firm Moneygram to China's Ant Financial. the digital payments arm of Alibaba.

If its children were not prepared to compete, how could Singapore hope to gain a foothold against the United States, Germany, or China? The country made sure to establish a first-class education system that was linked to the financial and commercial sectors. Seems obvious: invest in education and you ensure a strong workforce and vibrant economy. But in the United States we see education as a social issue, rather than an economic one. When budgets get cut at federal, state, and local levels, education often falls first under the ax. That, too, must change if we hope to compete.

Today’s equivalent is probably ‘get an engineering degree’, but it will not necessarily be as lucrative. A third of Americans who graduated in STEM subjects (science, technology, engineering and maths) are in jobs that do not require any such qualification.52 They must still pay off their student debts. Up and down America there are programmers working as office temps and even fast-food servers. In the age of artificial intelligence, more and more will drift into obsolescence. On the evidence so far, this latest technological revolution is different in its dynamics from earlier ones. In contrast to earlier disruptions, which affected particular sectors of the economy, the effects of today’s revolution are general-purpose. From janitors to surgeons, virtually no jobs will be immune. Whether you are training to be an airline pilot, a retail assistant, a lawyer or a financial trader, labour-saving technology is whittling down your numbers – in some cases drastically so. In 2000, financial services employed 150,000 people in New York. By 2013 that had dropped to 100,000. Over the same period, Wall Street’s profits have soared. Up to 70 per cent of all equity trades are now executed by algorithms.53 Or take social media. In 2006, Google bought YouTube for $1.65 billion. It had sixty-five employees, so the price amounted to $25 million per employee. In 2012 Facebook bought Instagram, which had thirteen employees, for $1 billion. That came to $77 million per employee. In 2014, it bought WhatsApp, with fifty-five employees, for $19 billion, at a staggering $345 million per employee.54 Such riches are little comfort to the thousands of engineers who cannot find work. Facebook’s data servers are now managed by Cyborg, a software program. It requires one human technician for every twenty thousand computers.

Bill Clinton's political formula for seizing the presidency was simple. He made money tight in the ghettos and let it flow free on Wall Street. He showered the projects with cops and bean counters and pulled the ops off the beat in the financial services sector. And in one place he created vast new mountain ranges of paperwork, while in another paperwork simply vanished. After Clinton, just to get food stamps to buy potatoes and flour, you suddenly had to hand in a detailed financial history dating back years, submit to wholesale invasions of privacy, and give in to a range of humiliating conditions. Meanwhile banks in the 1990s were increasingly encouraged to lend and speculate without filing out any paperwork at all, and eventually borrowers were freed of the burden of even having to show proof of income when they took out mortgages or car loans.

The inventor of GDP cautioned against including in its calculation expenditure for the military, advertising, and the financial sector,33 but his advice fell on deaf ears. After World War II, Kuznets grew increasingly concerned about the monster he had created. “Distinctions must be kept in mind between quantity and quality of growth,” he wrote in 1962, “between costs and returns, and between the short and long run. Goals for more growth should specify more growth of what and for what.

Back in the day, surplus harvests or an excess of rare minerals had been quietly shoved out into oblivion, assisting the market price, reaping bigger profits for the financial sectors at the expense of the consumer.

If you excuse investment concentration by telling yourself that your familiarity with domestic companies or specific sectors helps you understand those investments better, your familiarity bias is the excuse for your familiarity bias.

In a way, one could argue that the whole financial sector is a scam of sorts, since it represents itself as largely about directing investments toward profitable opportunities in commerce and industry, when, in fact, it does very little of that. The overwhelming bulk of its profits comes from colluding with government to create, and then to trade and manipulate, various forms of debt. All I am really arguing in this book is that just as much of what the financial sector does is basically smoke and mirrors, so are most of the information-sector jobs that accompanied its rise as well.

After long years tolerating tax evasion by their fellow members of the ruling class, the political leaders of the big Western economies had been forced by the cost of the bank bailouts, the subsequent recession and increasingly widespread hostility to cuts in public services to go after those missing tax revenues. Hence the Americans' pursuit of UBS, Credit Suisse, BSI and the rest. But the City was in a different position. It was not the UK Treasury that the City's clients were primarily cheating. It was everyone else's. And there was one more fact, so huge and so obvious that everyone ignored it the way only problems of such magnitude could be ignored. Tax evasion deprived governments of revenue. Money laundering was the other side of the same coin. Like tax dodging, it was a subversion of money's role as a token of reciprocal altruism that allowed large and diverse societies to function. But while tax evasion sucked money out, money laundering pumped money in. If you could stop yourself thinking about its origins, those inflows of dirty money from around the world were just another source of investment into otherwise declining economies.

One thing that stock investing has in common with real estate is that location is very important. In this case, however, we’re referring to where in the stock market your money is located. Being in the right sectors and industry groups can enhance your overall performance. Being in the wrong ones can hurt it.

From studying 50-plus civil wars and revolutions, it became clear that the single most reliable leading indicator of civil war or revolution is bankrupt government finances combined with big wealth gaps. That is because when the government lacks financial power, it can’t financially save those entities in the private sector that the government needs to save to keep the system running (as most governments, led by the United States, did at the end of 2008), it can’t buy what it needs, and it can’t pay people to do what it needs them to do. It is out of power. A classic marker of being in Stage 5 and a leading indicator of the loss of borrowing and spending power, which is one of the triggers for going into Stage 6, is that the government has large deficits that are creating more debt to be sold than buyers other than the government’s own central bank are willing to buy. That leading indicator is turned on when governments that can’t print money have to raise taxes and cut spending, or when those that can print money print a lot of it and buy a lot of government debt.

and prominent intellectual and political elites leaves the playing field open for others to step in and present themselves as advocates for the entire working or middle class or other distinct underrepresented groups. Indeed, politics since 2000 has been marked by the rise of populists—politicians who spurn “out-of-touch experts” and who claim to speak on behalf of millions of people with whom they in fact have no authentic connection, and in whom they have no genuine interest beyond securing votes to support their own often very personal agendas. In America, the first sign of things to come was during the Great Recession, with the emergence of the Tea Party movement in the Republican Party, inside and outside Congress. The movement formed in reaction to the efforts by the administration of Barack Obama to bail out the U.S. financial sector in the midst of the economic crisis. Its members initially presented themselves as fiscal conservatives, calling for the kind of lower taxes and limited government spending espoused by Ronald Reagan. They quickly moved on to oppose the administration’s promotion of universal health care and other social policies, and soon morphed into an activist protest movement supporting new candidates for office with a mixture of conservative, libertarian, and right-wing populist credentials. Many of these Tea Party candidates would later support Donald Trump’s election in 2016.

Hornsby said if you owe less than double your salary and are employed by a for-profit company in the public sector, you should probably refinance. Get the lowest rate possible to reduce the interest. Pay the loans back as quickly as possible. Move forward with your life.

Emmanuel Omowaiye is an experience forex trader who has spent many years investing in the financial sector. Emmanuel Omowaiye is passionate about religion and encourages people to spend more time getting to know their relationship with God. He is also an experienced architectural designer with NYC Technical College.

Nate Oeming is a financial planner who boasts a long history of success in the financial sector. He has around 20 years of experience in the sector and has received numerous awards and finished licenses to certify his status as an expert in the field. Nate Oeming loves to help his clients make wise investments.

An MMT understanding allows us to appreciate that there would be no financial impediment for a government building national industries, funding research and development, providing first-class universities and apprenticeship training and the rest. If a nation with its own currency slides into oblivion by closing its manufacturing sector, cutting career public sector jobs and relying on low-paid and precarious service sector jobs for employment creation, then that has little to do with running external deficits, and everything to do with political choices.

An MMT understanding allows us to appreciate that there would be no financial impediment for a government building national industries, funding research and development, providing first-class universities and apprenticeship training and the rest. If a nation with its own currency slides into oblivion by closing its manufacturing sector, cutting career public sector jobs and relying on low-paid and precarious service sector jobs for employment creation, then that has little to do with running external deficits, and everything to do with political choices.

Beirut port, confirmed as the principal port of the Syrian interior, was enlarged and modernized, a second dock was constructed and the city, provided with an airport, progressed to become a center for international communication. According to a new urban plan, the city was re-centered around Place de l’Étoile, designed on the model of that of the French capital, and the Parliament and a new business quarter were inaugurated there on the occasion of the French Colonial Exposition of 1921. These projects contributed to the development of a tertiary sector dominated by a merchant/financial bourgeoisie, which was becoming more and more embedded into the mandate system. This was supplemented by the expansion of education, another mandate policy, which helped create a middle class destined for liberal professions and the bureaucracy.

This is an imperfect representation of the scope and diversity of programs, as there is some double-counting across sectors due to the overlapping nature of our support.

It was a humbling question for someone from the financial sector to be asked—after all, we were the ones responsible.

What happened in the nineteen-eighties was something quite different, pressed upon governments from two quite distinct directions. In the first place, accelerating developments in technology—notably in telecommunications and the financial markets—were undermining the old ‘natural’ monopolies. If governments could no longer harness the airwaves, or the movement of money, for their own exclusive use, it made little sense for them to ‘own’ them. There remained a powerful political or social case for the state retaining part of a given sector—a public television channel, say, or the post office; but competition was now unavoidable.

In fact, most years, actively managed funds do not do any better than “passive funds” that simply replicate the stock market index. In fact, the average US mutual funds underperform the US stock market 52 —they seem to have borrowed the language of individual talent but not the talent itself. A large part of the premiums paid to financial sector employees are almost surely pure rents ; that is, rewards not for talent or hard work but for nothing more than having lucked out in landing that particular job.

Ah, yes. Just like the forthright and reassuring grasp of my late husband. No honest man has a handshake as honest as that. How in the world has it taken you so long to find the financial sector?

The similarities between both of these groups were striking and should be clear to anyone who reads this book. Both groups were and are defined primarily by an unshakable belief in the inhumanity of their enemies on the other side; the Christians seldom distinguished between Islamic terrorism and, say, Al Gore–style environmentalism, while the Truthers easily believed that reporters for the Washington Post, the president, and the front-line operators of NORAD were equally capable of murdering masses of ordinary New York financial-sector employees. Abandoned by the political center, both groups ascribed unblinkingly to a militant, us-against-them worldview, where only their own could be trusted. What made them distinctly American was that, while actually the victims of an obvious, unhidden conspiracy of corrupt political power, they chose to battle bugbears that were completely idiotic, fanciful, and imaginary

The benefits of financialization are not widespread, largely accruing to asset holders and those working in the financial sector. More importantly, financialization continues to elevate the significance of the markets at the expense of the real world.

For centuries European governments had granted monopolies on all kinds of production and trade to their loyal subjects. These weren’t gifts; the governments required payment in return, in the form of cash, interest, or a share of profits. These “fiscal monopolies” were an alternative to state control: industry remained in private hands, but governments received a steady stream of revenue, a kind of selective tax. The early fiscal monopolies included cigarettes, flax, gunpowder, liquor, petrol, playing cards, salt, and tobacco. For many countries, the tax revenues from fiscal monopolies were significant, as much as one-third or more of the overall government budget.1 France created one of the first match monopolies, in 1872, not long after the invention of strike-on-the-box Swedish matches. The transaction was straightforward: the French government simply leased the right to make and sell matches within France to a private corporation. Other countries soon followed France’s lead. Belgium, Bulgaria, Greece, Portugal, Romania, Serbia, and Spain all established fiscal match monopolies during the late nineteenth century.2 In France, when government officials finally realized how much money the private sector was earning from the match monopoly, they nationalized the industry. But elsewhere, the monopolies stuck.

Paul Angerame Financial organizations are looking into how blockchain technology could benefit the settlement, clearing, and insurance sectors.

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Conservative elites first turned to populism as a political strategy thanks to Richard Nixon. His festering resentment of the Establishment’s clubby exclusivity prepared him emotionally to reach out to the “silent majority,” with whom he shared that hostility. Nixon excoriated “our leadership class, the ministers, the college professors, and other teachers… the business leadership class… they have all really let down and become soft.” He looked forward to a new party of independent conservatism resting on a defense of traditional cultural and social norms governing race and religion and the family. It would include elements of blue-collar America estranged from their customary home in the Democratic Party. Proceeding in fits and starts, this strategic experiment proved its viability during the Reagan era, just when the businessman as populist hero was first flexing his spiritual muscles. Claiming common ground with the folkways of the “good ole boy” working class fell within the comfort zone of a rising milieu of movers and shakers and their political enablers. It was a “politics of recognition”—a rediscovery of the “forgotten man”—or what might be termed identity politics from above. Soon enough, Bill Clinton perfected the art of the faux Bubba. By that time we were living in the age of the Bubba wannabe—Ross Perot as the “simple country billionaire.” The most improbable members of the “new tycoonery” by then had mastered the art of pandering to populist sentiment. Citibank’s chairman Walter Wriston, who did yeoman work to eviscerate public oversight of the financial sector, proclaimed, “Markets are voting machines; they function by taking referenda” and gave “power to the people.” His bank plastered New York City with clever broadsides linking finance to every material craving, while simultaneously implying that such seductions were unworthy of the people and that the bank knew it. Its $1 billion “Live Richly” ad campaign included folksy homilies: what was then the world’s largest bank invited us to “open a craving account” and pointed out that “money can’t buy you happiness. But it can buy you marshmallows, which are kinda the same thing.” Cuter still and brimming with down-home family values, Citibank’s ads also reminded everybody, “He who dies with the most toys is still dead,” and that “the best table in the city is still the one with your family around it.” Yale preppie George W. Bush, in real life a man with distinctly subpar instincts for the life of the daredevil businessman, was “eating pork rinds and playing horseshoes.” His friends, maverick capitalists all, drove Range Rovers and pickup trucks, donning bib overalls as a kind of political camouflage.

The legislation, essentially bipartisan, drives new fiscal policies, tax changes, also rules of corporate governance, and deregulation. Alongside of this began the very sharp rise in the costs of elections, which drives the political parties even deeper than before into the pockets of the corporate sector. The parties dissolved, essentially, in many ways. It used to be that if a person in Congress hoped for a position such as a committee chair or some position of responsibility, he or she got it mainly through seniority and service. Within a couple of years, they started having to put money into the party coffers in order to get ahead, a topic studied mainly by Tom Ferguson. That just drove the whole system even deeper into the pockets of the corporate sector, increasingly the financial sector.

Unlike those corporations that focused on building a particular brand (e.g. Coca-Cola or Marlboro), or companies that created a wholly new sector by means of some invention (e.g. Edison with the light bulb, Microsoft with its Windows software, Sony with the Walkman, or Apple with the iPod/iPhone/iTunes package), Walmart did something no one had ever thought of before: it packaged a new ideology of cheapness into a brand that was meant to appeal to the financially stressed American working and lower-middle classes.

Once I saw this trend, the paper quickly wrote itself and was titled “Has Financial Development Made the World Riskier?” As the Wall Street Journal reported in 2009 in an article on my Jackson Hole presentation: Incentives were horribly skewed in the financial sector, with workers reaping rich rewards for making money but being only lightly penalized for losses, Mr. Rajan argued. That encouraged financial firms to invest in complex products, with potentially big payoffs, which could on occasion fail spectacularly. He pointed to “credit default swaps” which act as insurance against bond defaults. He said insurers and others were generating big returns selling these swaps with the appearance of taking on little risk, even though the pain could be immense if defaults actually occurred. Mr. Rajan also argued that because banks were holding a portion of the credit securities they created on their books, if those securities ran into trouble, the banking system itself would be at risk. Banks would lose confidence in one another, he said. “The inter-bank market could freeze up, and one could well have a full-blown financial crisis.” Two years later, that’s essentially what happened.2 Forecasting at that time did not require tremendous prescience: all I did was connect the dots using theoretical frameworks that my colleagues and I had developed. I did not, however, foresee the reaction from the normally polite conference audience. I exaggerate only a bit when I say I felt like an early Christian who had wandered into a convention of half-starved lions. As I walked away from the podium after being roundly criticized by a number of luminaries (with a few notable exceptions), I felt some unease. It was not caused by the criticism itself, for one develops a thick skin after years of lively debate in faculty seminars: if you took everything the audience said to heart, you would never publish anything. Rather it was because the critics seemed to be ignoring what was going on before their eyes.

All macro entities and institutions in the private, public, and voluntary sectors ultimately depend on the basic unit of families and thus should strongly support, financially and otherwise, well-conceived efforts to preserve and strengthen families and micro solutions.

Certainly there is no limit to taxation if the benefits derived from public services by society measure up to the cost in taxation.”2 As cited in the quotation at the beginning of this chapter, Obama Sr. is even willing to consider tax rates up to 100 percent! It’s remarkable that this paper by Obama Sr. has gotten so little media coverage. One would expect it to be on the front page of every newspaper and a lead item on the evening news, especially during public debates in America over taxes and massive government intervention in the health care and financial sectors. Notice the two-part economic strategy proposed by Obama Sr.: forced state control over private enterprise, and confiscatory tax rates with no upper limit. We will find it instructive to compare this to President Obama’s economic policies. For example, President Obama frequently talks about people being forced to pay their “fair share” in taxes, but he never specifies what that share is. Here, we have a document that explicitly states his father’s thoughts on the subject and may provide some guidance to the son’s own thinking. Yet for many in the media, these father-son comparisons are completely taboo. For them, it seems, the ghost of Barack Obama Sr. must be quietly ignored, so it cannot be seen haunting the corridors of 1600 Pennsylvania Avenue.

Geithner’s proposed terms for the loan—which drew heavily on the work of bankers he had asked to explore options for private financing for AIG—included a floating interest rate starting at about 11.5 percent. AIG would also be required to give the government an ownership share of almost 80 percent of the company. Tough terms were appropriate. Given our relative unfamiliarity with the company, the difficulty of valuing AIG FP’s complex derivatives positions, and the extreme conditions we were seeing in financial markets, lending such a large amount inevitably entailed significant risk. Evidently, it was risk that no private-sector firm had been willing to undertake. Taxpayers deserved adequate compensation for bearing that risk. In particular, the requirement that AIG cede a substantial part of its ownership was intended to ensure that taxpayers shared in the gains if the company recovered. Equally important, tough terms helped address the unfairness inherent in aiding AIG and not other firms, while also serving to mitigate the moral hazard arising from the bailout. If executives at similarly situated firms believed they would get easy terms in a government bailout, they would have little incentive to raise capital, reduce risk, or accept market offers for their assets or their company. The Fed and Treasury had pushed for tough terms for the shareholders of Bear Stearns and Fannie and Freddie for precisely these reasons. The political backlash would be intense no matter what we did, but we needed to show that we got taxpayers the best possible deal and had minimized the windfall that the bailout gave to AIG and its shareholders.

The growth in asset management income accounts for roughly 35 percent of the growth of the financial sector as a percent of GDP, driven by the opaque fee structures, especially when it comes to alternative investment vehicles.36 But in spite of their high fees, there is little evidence of any advantages, for instance in better long-run performance, when it comes to higher management fees.37 Other key sources of financial profits have come from their privileged position in running the economy’s payments system: ATM and sundry other fees levied on normal saving and checking accounts.

The phrase ‘too big to fail’ came into wide use in the global financial crisis to describe the dilemma that policymakers faced in resolving the affairs of systemically important financial institutions.3 The phrase provoked the justified rejoinder that ‘too big to fail is too big’. But ‘too big to fail’ misses the key point. Financialisation has led to increases in the size of financial institutions, but the central problem is not size but complexity. Size in banking can enhance stability, at least up to a point. Britain avoided significant bank failures in the twentieth century precisely because its banks were big, in contrast to the collapse of the fragmented US banking industry in 1933. The failure of the UK banking sector in 2008 occurred, and was traumatic, not because the sector had become more concentrated, but because it had become more complex. Lehman

But the current investment banking model—whether applied in a standalone institution such as Goldman or in a broad financial conglomerate such as Deutsche Bank—is at the heart of the problems the finance sector poses for the real economy. Investment banks today engage in securities issuance, corporate advice and asset management; they make markets in equities and FICC, and trade in these markets on their own account. It is only necessary to list these functions to see that each of these activities conflicts with all the others. Each should be undertaken in distinct institutions. And with lower volumes of inter-bank trading, a diminished role for public equity markets and much more direct investment by asset managers the scale of most of these activities should be much reduced. Among all the actors in the finance sector today, only the asset manager, who typically earns a fee calculated as a percentage of funds under management, is rewarded for idleness. The profits of a segregated deposit-taking bank would similarly depend primarily on the scale of the deposit base, and secondarily on its success in making good loans. Dedicated channels of capital allocation have a more appropriate incentive structure than activities focused on trading and transactions. Whenever

France and Germany are, among the countries with large financial sectors, the ones where anti-market rhetoric is strongest. But they are also the countries that have done the least to implement substantive financial reform since the global financial crisis. The principal reason is the instinctive corporatism of both countries, which equates the national interest in financial services with the interests of large national financial services firms. Thus the voice of Deutsche Bank is transmitted as the voice of Germany, not just in domestic German policies but also (and especially) in German positions in international financial negotiations. Germany’s policy positions are also compromised by the local political links of its many regional and community banks (links that have positive as well as many negative aspects). In France the homogeneity of an elite that glides easily from boardroom to cabinet table and back reinforces the sense that its state and its national industrial champions are one. And since France and Germany are the two most influential members of the European Union, the corporate influence extends to the conference rooms of Brussels. Little

Yet it is intrinsic to oligarchy that oligarchs are a small minority, a point graphically made in the ‘Occupy Wall Street’ slogan of ‘We are the 99 per cent’. But it is easier to identify what the 99 per cent are against than what they are for, an incoherence typical of the swell of unfocused public anger that followed the global financial crisis: anger with the finance industry and with the political failure to anticipate the crisis or respond effectively to it. Most countries ejected the governments—whether left or right—that had held office during the crisis. But that made no material difference to public policy towards the finance sector. In the absence of any intellectual framework for such policy beyond a call for ‘more regulation’, how could it? Perhaps

The main power of divestment is not that it financially harms Shell and Chevron in the short term but that it erodes the social license of fossil fuel companies and builds pressure on politicians to introduce across-the-board emission reductions. That pressure, in turn, increases suspicions in the investment community that fossil fuel stocks are overvalued. The benefit of an accompanying reinvestment strategy, or a visionary investment strategy from the start, is that it has the potential to turn the screws on the industry much tighter, strengthening the renewable energy sector so that it is better able to compete directly with fossil fuels, while bolstering the frontline land defenders who need to be able to offer real economic alternatives to their communities.

Since 2013, when Hillary stepped down from her position as secretary of state, $262 million has come in from foreign entities. The largest share of donations from the financial services sector has been from those contributors with close ties to Wall Street. A third of foundation donors who have given more than $1 million are foreign governments or other entities based outside the United States, and foreign donors make up more than half of those who have given more than $5 million. “The role of interests located in countries such as Saudi Arabia, Qatar, and Argentina may spur questions about the independence of a potential commander in chief who has solicited money from foreign donors with a stake in the actions of the US government.”569 This, of course, ignores the fact that these Islamic nations brutally oppress women denying them the right to vote, drive a car, get an education, choose their own husbands, or show their face in the public square.

Small is beautiful. This is what Mother Teresa used to say always. What Mother Teresa used to say is a reality in the spiritual world as also in the investment world. Taking inspiration from the quotation of Mother Teresa think of making a small investment in the Public Sector Undertaking shares which are offered to the small investors at a discounted price of say 5 per cent.