The headline grabbed my attention right away!
It was from an article in the New Yorker, that continues to offer me intriguing and generally useful information that I can believe, I hope!
It said, “What good is Wall Street?” The essay is very good with person to person views of several Wall Street biggies. Here is an excerpt from the essay:
Think of all the profits produced by businesses operating in the U.S. as a cake. Twenty-five years ago, the slice taken by financial firms was about a seventh of the whole. Last year, it was more than a quarter. (In 2006, at the peak of the boom, it was about a third.) In other words, during a period in which American companies have created iPhones, Home Depot, and Lipitor, the best place to work has been in an industry that doesn’t design, build, or sell a single tangible thing
So you don’t have to wonder any more why the US economy is “underwater” so to speak! It’s focused on the “useless fruits of pure capitalism” and that’s what’s gone wrong, I understand what John Cassidy is saying in his essay, at least in part.
Cassidy even found an apparent Wall Streeter, who seems to agree with the negative view of what happens on Wall Street now:
Paul Woolley, a seventy-one-year-old Englishman who has set up an institute at the London School of Economics called the Woolley Centre for the Study of Capital Market Dysfunctionality. “Why on earth should finance be the biggest and most highly paid industry when it’s just a utility, like sewage or gas?” Woolley said to me when I met with him in London. “It is like a cancer that is growing to infinite size, until it takes over the entire body.
Now that’s negative!
Later in the essay Wooley goes even further in commenting on market ups and downs:
Woolley had an epiphany: financial institutions that react to market incentives in a competitive setting often end up making a mess of things. “I realized we were acting rationally and optimally,” he said. “The clients were acting rationally and optimally. And the outcome was a complete Horlicks.” Financial markets, far from being efficient, as most economists and policymakers at the time believed, were grossly inefficient. “And once you recognize that markets are inefficient a lot of things change.”
But I haven’t seen much CHANGE! Have you?
- Can Wall Street Justify Its Existence? (dealbook.nytimes.com)
- 5 Traits of a Great Headline (searchenginepeople.com)
- Here’s why I wish Sarah Palin wasn’t so damned good at grabbing everyone’s attention. (althouse.blogspot.com)