re: #179 Hecuba’s daughter

Except, nowadays, most “owners” are mutual funds or pension funds that really have little to do with management or the operation of the company. They are people like you and me who have a few thousand dollars in GM or Honda or Apple. We want our 401(k)s to provide us with sufficient money to live out retirement, without worrying about starvation or homelessness. Maybe capitalism is too flawed to continue. I don’t pretend to have any answers for the ideal economic structure that leads to a combination of innovation, environmental protection, and a satisfactory standard of living for all.

That’s an idea that’s been promoted to discourage financial regulation, but it turns out that the vast majority of shares are still held by the top 1%. This is especially true post-2009.

That does bring up an important point, though, one that Paul Krugman and others have been talking about for a while. Our top 1%, especially the top 0.1% now have SO MUCH MONEY that this money keeps creating asset bubbles which inevitably burst, with the worst being the mortgage bubble a decade ago. There’s SO MUCH MONEY out there looking for a safe, high yield investment that as soon as one appears, money flows into that market, raising asset prices and creating the appearance of an even better investment. Lather, rinse, repeat, until somebody finally says, “Wait - how the hell is a barely employed Mariachi musician* supposed to pay the mortgage on a $300,000 house?”

Then, *poof!*

*One of my favorite stories about how crazy it was at the peak of subprime mortgage writing was when they were writing mortgages with no income or employment verification. One guy provided a picture of himself in the outfit he wore playing in a Mariachi band. That was good enough.