5 ms·

> probably because it's difficult to see any actual value that this provides to society. Doesn't this apply to a majority of activities in the financial sector

> probably because it's difficult to see any actual value that this provides to society. Doesn't this apply to a majority of activities in the financial sector?

fooker 7y ago
No, a large fraction of modern tech and companies would not exist without the 'activities in the financial sector'. Essentially any endeavor requiring capital beyond your means would have to be bootstrapped or required borrowing money at exorbitant rates. There is a reason the financial sector exists. It makes money by selling convenience and taking over quantified risk.
- reallydontask 7y ago
  My point is not that the financial sector is unnecessary, it's that the majority of the activities are not of benefit to society, which admittedly is something hard to define. Following on from that line of thought, it could be argued that a lot of companies don't provide any benefit to society, so the financial sector is just enabling these firms and thus of no benefit to society.
  - kortilla 7y ago
    The sector exists because people willingly give it money in exchange for services. If you can’t imagine why that’s happening, maybe read up on why people pay for financial services rather than assuming something as stupid as most of financial services not providing benefit to society.
    - smolder 7y ago
      No one's confused why it's happening. It's legal to make money through financial services, and it reliably makes money. The investments into fintech that divert more cash one way or another until others catch up also provide very little and ever diminishing value, mostly just sideways and upward redistribution of wealth. The actual value generating sectors of the economy are always getting more anemic, and they're due for collapse because of how much everything depends on oil, cheap 3rd world labor, and creating external costs we've avoided facing.
      - kortilla 7y ago
        >No one's confused why it's happening. It's legal to make money through financial services, and it reliably makes money. No, you’re misunderstanding me. People are willingly using the services offered by the financial services sector. It’s the reason companies can quickly raise billions through IPOs, the reason you can get a million dollars for a mortgage and pay it back over 30 years, etc. Market participants that enable better price discovery and subsequently narrow bid/ask spreads provide immense value to society. An average of just a quarter percent lower interest on mortgages is billions of dollars kept in people’s pockets. More efficient markets enable that and it’s these traders you loath that are making it more efficient. If it were just up to the banks they would love nice slow markets with huge spreads so they can line their pockets with your money. >The actual value generating sectors of the economy Sigh, that statement makes no sense already because finance generates massive value. It’s the reason people can retire. It’s the reason normal people can buy houses. It’s the reason normal people can start capital intensive businesses. Efficient allocation of capital is one of the largest force multipliers of any modern economy. You lament that other sectors are anemic, but many could not even exist if it weren’t for financial instruments that allow them to control costs, raise capital, etc.
        smolder 7y ago
        > Sigh, that statement makes no sense already because finance generates massive value. I think it's not clear what I meant by value generation, and that's on me as I'm sure there's an established meaning that differs from mine. In my eyes, moving money from one person to another is not value generation. Only work that improves the net quality of life is generating value. As an example, someone who spends all day digging holes and filling them in for money has destroyed value, because their work helps no one and the money transfer is almost neutral overall. Being a facilitator of mutually beneficial trade has value, but work that only extracts wealth destroys value by using labor to no net benefit --they could have been enjoying their time instead. It's not something you can easily measure, but through this lens you can see how much of what we allocate human effort to is a waste.
        7y ago
stakhanov 7y ago
Doesn't this apply to a majority of activities, period? (See recent discussions on "bullshit jobs")?

> probably because it's difficult to see any actual value that this provides to society. Doesn't this apply to a majority of activities in the financial sector?

fooker 7y ago

No, a large fraction of modern tech and companies would not exist without the 'activities in the financial sector'. Essentially any endeavor requiring capital beyond your means would have to be bootstrapped or required borrowing money at exorbitant rates. There is a reason the financial sector exists. It makes money by selling convenience and taking over quantified risk.

reallydontask 7y ago
My point is not that the financial sector is unnecessary, it's that the majority of the activities are not of benefit to society, which admittedly is something hard to define. Following on from that line of thought, it could be argued that a lot of companies don't provide any benefit to society, so the financial sector is just enabling these firms and thus of no benefit to society.
- kortilla 7y ago
  The sector exists because people willingly give it money in exchange for services. If you can’t imagine why that’s happening, maybe read up on why people pay for financial services rather than assuming something as stupid as most of financial services not providing benefit to society.
  - smolder 7y ago
    No one's confused why it's happening. It's legal to make money through financial services, and it reliably makes money. The investments into fintech that divert more cash one way or another until others catch up also provide very little and ever diminishing value, mostly just sideways and upward redistribution of wealth. The actual value generating sectors of the economy are always getting more anemic, and they're due for collapse because of how much everything depends on oil, cheap 3rd world labor, and creating external costs we've avoided facing.
    - kortilla 7y ago
      >No one's confused why it's happening. It's legal to make money through financial services, and it reliably makes money. No, you’re misunderstanding me. People are willingly using the services offered by the financial services sector. It’s the reason companies can quickly raise billions through IPOs, the reason you can get a million dollars for a mortgage and pay it back over 30 years, etc. Market participants that enable better price discovery and subsequently narrow bid/ask spreads provide immense value to society. An average of just a quarter percent lower interest on mortgages is billions of dollars kept in people’s pockets. More efficient markets enable that and it’s these traders you loath that are making it more efficient. If it were just up to the banks they would love nice slow markets with huge spreads so they can line their pockets with your money. >The actual value generating sectors of the economy Sigh, that statement makes no sense already because finance generates massive value. It’s the reason people can retire. It’s the reason normal people can buy houses. It’s the reason normal people can start capital intensive businesses. Efficient allocation of capital is one of the largest force multipliers of any modern economy. You lament that other sectors are anemic, but many could not even exist if it weren’t for financial instruments that allow them to control costs, raise capital, etc.
      - smolder 7y ago
        > Sigh, that statement makes no sense already because finance generates massive value. I think it's not clear what I meant by value generation, and that's on me as I'm sure there's an established meaning that differs from mine. In my eyes, moving money from one person to another is not value generation. Only work that improves the net quality of life is generating value. As an example, someone who spends all day digging holes and filling them in for money has destroyed value, because their work helps no one and the money transfer is almost neutral overall. Being a facilitator of mutually beneficial trade has value, but work that only extracts wealth destroys value by using labor to no net benefit --they could have been enjoying their time instead. It's not something you can easily measure, but through this lens you can see how much of what we allocate human effort to is a waste.
        7y ago

stakhanov 7y ago

Doesn't this apply to a majority of activities, period? (See recent discussions on "bullshit jobs")?