So it goes with the financial crisis of 2008. Few of the people talking about it, from President Obama on down, show the slightest interest in understanding what actually happened and how to prevent it from happening again. The story is everything, and that story is: Evil bankers in an unregulated Wild West of capitalist depravity crippled the economy, cost us taxpayers billions of dollars in bailouts and carried on in a lawless spree that should have resulted in jail time for everybody.
To say the least, it’s an imprecise view, which raises the question: When it’s time to make a movie dealing in complex material about contemporary financial instruments, is the guy who brought us “Anchorman 2” really the best available option?
Reuven Brenner reviews Phishing for Phools. He is not impressed. (HT Levi Russell)
The greatest beneficiaries, by far, of vast business ventures such as Facebook are not the founders, but the customers. When Lancashire entrepreneurs made cotton textiles affordable for all, it was all who benefited; when Rockefellers did the same for oil, or Carnegies for steel, again the overwhelming majority of the benefits flowed to the customers. One study, by William Nordhaus, found that entrepreneurs end up with less than 3% of the societal value that they have created. Some goes to financiers, but the vast bulk of the benefit turns up as consumer surplus.
Likewise with today’s magnates: the fortunes amassed by the Messrs Gates, Jobs, Bezos and Zuckerberg are as nothing to the value that has been captured by their willing customers in the form of better services delivered far more cheaply and easily.