Our Summary Of Traditional Finance
Time to revisit and look at everything discussed and reviewed till now.
We have written a series of micro-articles (more than a tweet, lighter than a blog!) to make a case for some of the major things that are wrong with the world of finance and capital, let’s call it?Traditional Finance.
Unfortunately, it’s not pretty! We’ve had some stark truths emerge, backed by data and analysis.??But starker (and even stranger), is the fact that many of these revelations that we as citizens (whose wealth we are talking about!) are unaware of, do not know the extent of the issue.??The reason is, we take many things for granted and we blindly buy into the narrative and never think independently.??And to be fair, many of these are deep matters of finance and economics and not for the average reader. Yet, it is sad that it does not get the coverage and Mindspace of the average investing public as we would have liked.
We considered many aspects. A quick recap of them is summarized below.
Firstly, we saw how?wealth inequality?is at it’s worst.??The gap between the rich and the poor has been widening and the pace has picked up in the recent years. We have seen as some economists describe a movement of economic might between sections of humanity.??With economic might, sadly comes many other things, better health, more political power, obviously better social standing, and the list goes on.??As humanity we need to recognize, pause, and look at ways and means of fixing this systemically.
Then we took up one of the holy cows of modern capital/finance -?Fractional Reserve.??Due credit is owed on the systemic contribution to modern banking but with the indiscriminate usage, it has created havoc and has been the trigger for cyclical economic crises – including, the current looming recession too!
We then turned to the state of regulation, especially around?regulatory levies and penalties.??We noticed how we live in a world of fat fines. At first, one may assume that’s a healthy deterrent or the wielding of the stick. Closer scrutiny reveals that far from a deterrence, these levies are treated as a cost of doing business OR there’s more nefarious forms of collusion between the ones imposing the fines and those fined.
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We explored derivatives and weakly backed?financial instruments. What we found was alarming.??Instrument types of large economic importance have very real economic/capital/wealth-based backing. They are largely just speculative and border on gambling.??
Finally we took a close look at?Tax havens and opacity in structures and regulation.???Again, we looked at the opacity of the joint stock company and the protection it provides which could be considered as positive. But then, we saw the tax havens and their continued operations is a telling statement on the wealthy and their clout and how they control their assets and work to protect and grow the same.
The consistent point in all these threads of discussion, is the profound??impact and damage that they have caused.??As said earlier, the awareness and public discourse is not really at centre stage in spite of its profundity.
Can this be addressed??
We must unthink and unlearn all that we have taken for granted in the world of finance.??Rethink and reimagine a new world of finance, potentially with a new carrier of value, a new money,??thereby leading us to a fairer, equitable and happier world. We at Qiam are doing just that! Stay connected to know more...