I don't think the article makes this assumption. I'd say the general thesis presented in the article is in this sentence: "Wall Street hedge funds rarely make

I don't think the article makes this assumption. I'd say the general thesis presented in the article is in this sentence: "Wall Street hedge funds rarely make their fortunes by placing sound long term bets about the proper allocation of resources. " Now, there's a lot of wiggle room in the word "rarely." I think that everyone would agree that there is some rent-seeking behavior on wall street, and everyone would agree that the banking sector plays a critical role in the economy (moving money from where it is to where it is needed, and managing risk). So the real disagreement is about the ratio. This article seems to imply that only a quarter of wall street's activities produce economic value. That's very low, lower than I've read anywhere. However, Paul Woolley at the LSE estimates that the financial sector would be a "third to a half" of its size (see link below), though, if it were limited to the wealth-producing activities. It's a controversial statement, of course, but he's hardly alone in this estimate. For anyone interested in this topic, I'd recommend starting with a New Yorker article titled "what good is wall street?" http://www.newyorker.com/reporting/2010/11/29/101129fa_fact_cassidy http://www.newyorker.com/reporting/2010/11/29/101129fa_fact_... And follow the links to the researchers listed to read more about the details that are not included in the New Yorker article.