On Sun, Apr 12, 2009 at 12:35 PM, c b <[email protected]> wrote: > how does all that activity sitting at desks and computers on Wall > Street actually _create_ wealth. for which the Wall Street bureaucrats > are so handsomely compensated ? Answer : It doesn't. No matter how > complex the math, it can't demonstrate that those activities do create > so much wealth. How does "speculating", putting some money at "risk", > create new wealth for which the "speculator" is appropriately rewarded?
We need to be careful not to group all kinds of speculators together. Certain types of speculators do actually take risk e.g. venture capital firms and it is possible to make a case that they deserve to be well-compensated because they perform the service of allocating scarce capital to promising innovations. While we may argue over whether their compensation is excessive, there is a fundamental difference between this type of capital that incurs genuine risk and the derivatives casino on Wall St. That is not speculation, but is more accurately described as looting, because no one's capital is in reality at any risk because they have captured the institutions of government. > ( Leaving aside the question of do most successful "speculators" > really take big risks or do they involve themselves in "sure things" > ?) This is really the key issue. The "speculators" on Wall St *pretend* to take risk in order to justify (to themselves?) the profits they are making. In reality, they have managed to rig the system so that their risk is implicitly insured by the tax payer. Once again the story the capitalists tell to fool the masses is different from what goes on in reality. Even on its own terms - ignoring any Marxist theories of value - financial capitalism is exposed as a fraud. -raghu. -- "I'm an apathetic sociopath - I'd kill you if I cared." _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
