tag:blogger.com,1999:blog-4290163255778893789.post2501492238207449496..comments2024-03-16T05:19:07.061-04:00Comments on Retirement Blues: Correlation and CausationJazzbumpahttp://www.blogger.com/profile/07337490817307473659noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-4290163255778893789.post-55812277248708974312011-09-14T19:52:39.036-04:002011-09-14T19:52:39.036-04:00me: the increasing income of the financial sector ...me: the increasing income of the financial sector is an increasing cost to the non-financial sector.<br /><br />you: Right. It also involves the wrong use of debt.<br /><br />me: As financial costs increase for the non-financial sector, financial profits increase relative to non-financial profits. Because of that, the financial sector is more appealing to investors than the non-financial sector.<br /><br />The thing that drives the "wrong use of debt" is that profits are better in the financial sector than elsewhere.The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.comtag:blogger.com,1999:blog-4290163255778893789.post-24544071145341305852011-09-14T18:16:29.340-04:002011-09-14T18:16:29.340-04:00There are probably a lot of datasets of which this...<i>There are probably a lot of datasets of which this is true.</i><br /><br />I very much doubt it.<br /><br /><b>"High finance sector profits contribute to a concentration of wealth at the top of society."</b><br /><br />Exactly.<br /><br /><i>the increasing income of the financial sector is an increasing cost to the non-financial sector.</i><br /><br />Right. It also involves the wrong use of debt.<br /><br />Cheers!<br />JzBJazzbumpahttps://www.blogger.com/profile/07337490817307473659noreply@blogger.comtag:blogger.com,1999:blog-4290163255778893789.post-41795657649161945472011-09-14T17:38:30.829-04:002011-09-14T17:38:30.829-04:00That was an interesting exchange, I thought.
One ...That was an interesting exchange, I thought.<br /><br />One thumb down: <b>"The indicator value of finance sector peaks in identifying recessions since WW II is ten for ten - 100%."</b><br /><br />There are probably a lot of datasets of which this is true. (This is just a first reaction, not a well-considered reply. But my initial reaction is that your claim is ...probably not meaningful.)<br /><br />One thumb up: <b>"As additional confirmation, consider the times when the percentage of finance sector capture is below trend for several years in a row. These times are specifically the longest recession-free periods in the time frame."</b><br /><br />This is a brilliant insight. I like it. I have <a href="http://newarthurianeconomics.blogspot.com/2010/10/adam-smith-explains-demise-of.html" rel="nofollow">this</a>.<br /><br />And one simple observation: <b>"High finance sector profits contribute to a concentration of wealth at the top of society."</b><br /><br />Yes, and -- <i>apart</i> from the relative fall of wealth and income for everyone below the top -- the increasing income of the financial sector is an increasing cost to the non-financial sector.The Arthurianhttps://www.blogger.com/profile/16501331051089400601noreply@blogger.com