The Root of All Economic Evil — Part II

I don’t remember exactly when the change occurred, but I do recall realizing at some point that an important line had been crossed, one where paying the lowest price became a kind of status symbol.

As a child, I remember feeling somewhat embarrassed when a fried proudly invited me to see his new color television — a Curtis-Mathes — and listening to him casually brag about it being the best brand and more expensive than any other. While it didn’t look all that much different than our much less expensive Zenith, I remember thinking that it must be nice to be able to afford the very best.

Of course there are some today who are willing to pay for quality, but I find that this affords the buyer little status. In fact just the opposite. Continue reading

The Root of All Economic Evil: Part I

Every business morning, thousands of men and women arrive at work (mostly in New York but in many other places around the country, as well). And at the end of every workday, they will have produced nothing — not a paper clip, not so much as a toothpick.

They are professional gamblers.

All day, every day, they bet with one another, shuffling paper at the end of each bet, like casino chips.Some bet with their own money, most with money that has been trusted to them.

They are parasitic. They can do what they do only because someone else is productive, someone else creates the economic value that forms the basis for all the betting.

Of course, I’m talking about the financial class, the brokers, investment banks, traders, rentiers, and all the various structures, people and institutions that support them.

Now before someone goes off the deep end, I understand that capital markets serve a vital function in our society. They provide liquidity (if you own shares in a company and need to sell those, you have to be able to find a ready buyer) and they make capital available to fund economic activity, by facilitating the sale of shares in a company, or lending to companies.

And yes, I know that using the word “evil” is a bit hyperbolic.

But consider…

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