You Think You’re An Investor? I Think Not
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John M. Fox National Peanut Corp. store on Broadway, NY 1947 Let’s start with defining what an ‘investor’ really is. A reasonable definition of an inv
[See the full post at: You Think You’re An Investor? I Think Not]When investors allocated their funds based on “productivity,” it was, more or less, labor productivity, maximum output for minimum input. It was not based on net energy or fewer externalities/social costs.
Investors today ought to ask themselves how do they define “productive activity.” Except for permaculture or other small scale, local agriculture, I offer that very little humans do at this point is productive or wealth building. We are takers.
Welcome to the new economy based upon the skim. Skim off a small percentage for doing nothing. Just like a parasite, it works until the host is bled dry. HFT is nothing more than a skimming operation and so is almost everything else in the “financialized” economy. And these are the people and organizations we are the look up to. What a joke.
One more example of why the economy and society are going nowhere. Markets and the economy exist in seperate spaces, and the economy is being crowded out. Those pesky factories are interfering with innovative finance, let’s move the last of that trash out soon.
Skims, scams, flim-flams. But we do have those productive stock buybacks (sarc). Why, they are producing great wealth for the elite CEO’s.
“Stock buybacks are so massive—6.9 trillion since 2004—that it justifies Mr. Hanauer’s description of them as “the biggest scam bankrupting business and the middle class.” […] “Our crisis of income inequality wasn’t principally caused by the rich not paying enough tax, even though we don’t. Rather, it is largely the product of the $1 trillion a year that once went to wages, but now goes to corporate profits. And this consumer demand and investment-killing trillion-dollar-a-year transfer of wealth from the bottom 80 percent of households to the top 1 percent is the direct result of the economic and regulatory policies both Republicans and Democrats have imposed since the dawn of the trickle down era.” That was in 1982 when President Reagan loosened the rules that had made stock buybacks a form of illegal stock manipulation, he adds. […]
“Wal-Mart has spent [over ten years] more than $65.4 billion on stock buybacks — about 47 percent of its profits. That’s an average of more than $6.5 billion a year in stock buybacks, enough to give each of its 1.4 million U.S. workers a $4,670-a-year raise. It is also, coincidentally, an amount roughly equivalent to the estimated $6.2 billion Wal-Mart costs U.S. taxpayers every year in food stamps, Medicaid, subsidized housing, and other public assistance to its many impoverished employees. In this context, how can stock buybacks be either morally or economically justified?”
Reagan was quite the man, wasn’t he? It took an actor to sell “trickle down” and still keep a straight face.
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