New York Stock exchange trading floor
The New York Stock Exchange trading floor in 2009.

Risk, Gambling, and Financialization

By George Kasabov
Contributing Writer

Since 1950, the US financial sector has grown almost three times in size. This growth has been accompanied by a switch of emphasis. It has increasingly turned away from the financing of industry and commerce and concentrated instead on the business of making money from money – the process of financialization. Banking, asset management, insurance and the owners of capital have found new ways to extract money without adding value to the rest of the economy. Finance has become more corrupt. But it is not just people in finance that have been “taking” not “making.” Top people in commerce and industry have learned to do it too.

One could say that this is not new, that ever since the birth of finance, over 5,000 years ago in Mesopotamia, those with money to spare have mostly been self-serving, bent on making a profit for themselves by usury, speculation, and rent. Also, the powerful have always aimed to control the government and legal systems for their own benefit, and since the beginning of modernity in the 16th century, merchants and financiers have increasingly gained that power.

Capital in the Twenty First Century

Thomas Piketty

A leading economist documents the trend of income inequality through history, stressing that the way an economy functions is directly related to a power structure that is determined and maintained by the few who hold the wealth.

Doughnut Economics

7 Ways to Think Like a 21st Century Economist

Kate Raworth; reviewed by George Kasabov

A “renegade economist” advances a new, more comprehensive and regenerative economic model – one based on a view of humans as socially adaptable beings in a world of limited natural resources. A view that factors in the love and caring of family life, the kindness and cooperation of society, and the search for meaning and morality over the getting and spending of money as the essential aim of human existence.

The Business of Changing the World

How Billionaires, Tech Disrupters, and Social Entrepreneurs Are Transforming the Global Aid Industry

Raj Kumar

In 2000, Raj Kumar and friends created Devex, an online community for global development that matches up organizations with funding opportunities and provides the largest database of grants, tenders, and other funding information. This book was written 20 years later to provide a clearer picture of how the aid industry operates, and where it’s headed.

Creating a Learning Society

A New Approach to Growth, Development, and Social Progress

Joseph E. Stiglitz

A Nobel economist and a leading finance expert posit the view that learning is more important to growth and development than the accumulation of capital. The traditional view of an inherently efficient free market, and of government regulation as the major source of economic difficulty, impedes the raising of a society’s standard of living by discouraging the production and dissemination of knowledge.

Further Reading

External Stories and Videos

Three Investment Banks Control More Wealth Than GDP of China – and Threaten Our Existence

Paul Jay,

Money managers have enormous power as they invest trillions of dollars across a spectrum of companies and vote those shares on behalf of their clients. Managers vote on management changes, board elections, mergers and acquisitions, special shareholder proposals and thus wield great influence on the CEOs of these companies.

Watch: Money and Sustainability: The Missing Link

Global Community Initiatives

Bernard Lietaer prepared a report for the Club of Rome on the link between our monetary system and the unsustainable trends in the world – this is a summary of the report.

Watch: The Value of Everything | Mariana Mazzucato

Founders Pledge

Who are the makers and takers in our economy? If we want sustainable and fair economic growth, Professor Mazzucato argues, we need to question the stories we’ve been told about value creation.