image missing Date: 2021-10-26 Page is: DBtxt003.php L0900-CS-EC-Financial-Capital-01a


THE FINANCIAL DIMENSION OF ECONOMIC CAPITAL
IT HAS BEEN THE DRIVER OF PROGRESS SINCE THE BEGINNING OF THE INDUSTRIAL ERA
MONEY / LIQUIDITY

Stock market

Intangible value

Money supply

World GDP growth

US GDP growth

GDP v GPI
DECLINE IN THE VALUE OF US MONEY
Some people say that it is money that makes the world go round. A better way to understand money is that it is more a lubricant than a fuel.
GROWTH OF US HOUSEHOLD DEBT
This is one of the most obscene trends in finance and rarely discussed. Consumption, which is a key component of the GDP calculation and an important driver of corporate profit has been sustained by ruining the balance sheet of wage earning housholds.
PROFITS ... THE DOMINANT GOAL IN THE MODERN ECONOMY
This
FINANCIALIZATION ... BIG ROLE FOR CAPITAL MARKETS
Capital markets are widely seen as a proxy for economic performance. They are monitored minute by minute round the clock and reported on by all the mainstream media. What they measure is not well understood, but that does not seem to matter. Worse, key issues related to social and environmental performance are not reflected well at all!
GDP ... NOT ONLY A STUPID METRIC, BUT ALSO DANGEROUS
GDP was a breakthrough metric when economists introduced it better to understand the Great Depression of the 1930s. Post WWII, both Keynes and Kuznets wanted it to be upgraded, as did Bobby Kennedy in the 1960s.
PRODUCTIVITY UP BUT US WAGES FLATLINE
GDP
GDP / Corporate Profits / Stock Markets are insufficient
Money / Profit growth / GDP growth / Stock Prices / Cost push inflation / Wages chasing prices
.


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