wow, I could probably rant a while on this...
If more Americans knew at least the basics of the big picture of financial dynamics/literacy/health, domestic/foreign market dynamics, the genius of creative-destruction for economic vibrance and renewal, and a bit about logic and logical fallacies - then more Americans would realize their vote, voice, perspective, and genius is worth something and we'd have actual leaders in government and business.
I'll probably write more later, but consider this - the option of the U.S. going back to being 1) the cheapest workforce in the world and 2) and agriculture based economy...it will depend on what the American people really want and how much we really care...
Yes, I'm short/mid-term pessimistic and maybe every generation has that, but with international economic/market dynamics growing faster, more sophisticated and varied than ever before...the tides are turning and different economies will have to adapt via the genius of creative-destruction - destroying the carbon spewing industries first and simultaneously creating a green tech industry may be the most effective thing to do...nothing is certain, but I think it's worth a shot.
This is from an interview with John Bogle by Bill Moyers. The transcript is a long read. I include some excerpts. A profile on Mr. Bogle is at:
In the first 15 years I was in this business, the average mutual fund held the average stock for seven years. Call that long term investing. Now, the average mutual fund holds the average stock for one year. That's short term speculation. So, if you're a speculator, you don't care much about ownership interest. You don't care so much about corporate governance. Why vote a proxy, for example, if you'll not even be holding a stock in three months?
These mutual fund companies-- these management companies are now owned largely by corporate America. Or international corporations ? Deutsche Bank ? AXA, big international companies who have bought their way into the US financial system, which is-- don't mean to demean that. But, they own these public corporations-- giant public corporations like insurance companies, big banks-- foreign insurance companies and banks own 41 of the 50 largest mutual fund managers.
Now, what is the job of a corporation when they buy into a mutual fund management company? It's to earn a return on the capital they invest in that company. It's not to earn a return on the capital of the investors who invested with that mutual fund. Now, in fairness, they want to earn as much money as they can for the fund shareholders. But, not at their own expense.
What we've done is have you know, what I call in the book, a pathological mutation of capitalism from that old traditional owners' capitalism to a new form of capitalism, which is manager's capitalism. The evidence is quite compelling that today corporations are run in a very important way to maximize the returns of its managers at the expense of its stockholders.
Its CEOs, well, the upper level of five or six top officers. And they get enormous amounts of pay for actually doing very little. I'm a businessman. Listen, we all-- we chief executives get an awful lot of credit that we don't deserve. Real work in companies is done by the people who are getting themselves together and doing the hard work of making companies grow--
They get laid off. And, of course, the ironic part of that is they often get laid off ? used to be called downsizing. But, of course, in today's America, it's called right sizing. They get laid off. That reduces expenses. That increases earnings and that means the CEO gets more.For an agricultural economy, 95 percent, 98 percent agricultural when this country came into existence. And even by 1850, half agricultural. Now it's about, they moved from agricultural economy, to a manufacturing economy, to a service economy. And now to a financial service economy.
Where agriculture and manufacturing and services, I mean, I'm perfectly willing to give a high value, for example, to art and poetry and literature. They add value to society. It may not be easy to measure it in a society that measures too much of what's not important. And not enough of what is important. As the sign in Einstein's office says-- "There are some things that count that can't be counted. And some things that can be counted that don't count." ?
I found his comment that our economy moved from agricultural to manufacturing to service and now financial service.