Financialization and the Shareholder Revolution
The argument in this chapter is that financialization is not a good long-term strategy for the country or the economy. Financialization is about risky trading and the return on net assets that benefits its shareholders but not the parts of the economy that could lead to long-term growth.
Prior to 1980, the financial industry’s role was to fund business and enable investment. But, over the years, a new financial strategy has emerged called financialization—defined as the “growing scale and profitability of the finance sector at the expense of the rest of the economy and the shrinking regulation of its rules and returns.” It began with deregulation and slowly grew to create changes in ...
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