An interesting observation by Nobel-prize winner Joseph Stiglitz last Monday at the London School of Economics in response to the euro being under speculative pressure due to budget problems in Greece:
“The irony of this attack should not go unnoticed: the fact that Europe and America were brought into the current mess because of the failures of the financial system. Their deficits grew in the attempt to save the banks and the economy as a result of the financial system failure, and now the financial systems are lecturing the governments about the size of the deficits that their behaviour created…the fact is that the financial markets are again exhibiting the same kind of irrationality and short-sightedness they continually exhibited.”
Economists regularly state that the market is always right. I think it is just about time that we put an end to this dictatorship of the markets. The speculative global financial markets are driven purely by profit. Since not all that we value is included in the price and profit, by definition the market cannot be right. It is time for a big update of the system. From capitalism 2.0 to capitalism 3.0. More about that in my next posting.
“The irony of this attack should not go unnoticed: the fact that Europe and America were brought into the current mess because of the failures of the financial system. Their deficits grew in the attempt to save the banks and the economy as a result of the financial system failure, and now the financial systems are lecturing the governments about the size of the deficits that their behaviour created…the fact is that the financial markets are again exhibiting the same kind of irrationality and short-sightedness they continually exhibited.”
Economists regularly state that the market is always right. I think it is just about time that we put an end to this dictatorship of the markets. The speculative global financial markets are driven purely by profit. Since not all that we value is included in the price and profit, by definition the market cannot be right. It is time for a big update of the system. From capitalism 2.0 to capitalism 3.0. More about that in my next posting.
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