Friday, September 26, 2014

Pravda — The Large Families that rule the world


Something to think about. Piketty's dynastic wealth?

Pravda
The Large Families that rule the world
(h/t Don Quijones at Raging Bull-Shit)

2 comments:

Ryan Harris said...

Their point is interesting but their facts are muddied by errors and outsized claims about the importance of US institutions. US has only 1 bank in the top 10, JPM. And only 3 in the top 20, adding Citi and BofA. China Banks and European Banks are much larger than their US counterparts because US Government Agencies and markets have long provided most credit to US Businesses and Consumers, and not the banking system in the United States.

These are the largest banks in the world:
1.)Industrial and Commercial Bank of China
2.)HSBC
3.)Credit Agricole
4.)BNP Paribas
5.)Mitsubishi UFJ
6.)JP Morgan
7.)China Construction
8.)Deutsche Bank AG
9.) Agriculture Bank of China
10.)Barclays

The populists have long engaged in heavy rhetoric in the United States over "bailouts", "tbtf", and all the other moral hazard ideas that turn off the sense of rugged libertarianism popular in the psyche. This resulted in a regulatory scheme that favors risk investment over insured deposits and subsequent regulatory decisions were made to minimize the ability of banks to hold assets and then to limit the types of finance that banks are allowed to engage in. The "BigFour" are the companies where most Americans put their 401ks and pensions, generally savings above the deposit insurance caps. But they hold the savings of millions of americans, they aren't controlled by the Waltons or Eric Schmidt of Google or the Rockefellers or whoever is the antagonist of populist narrative this week.

Ignacio said...

The "BigFour" are the companies where most Americans put their 401ks and pensions, generally savings above the deposit insurance caps. But they hold the savings of millions of americans, they aren't controlled by the Waltons or Eric Schmidt of Google or the Rockefellers or whoever is the antagonist of populist narrative this week.

This. These sort of claims are absurd.

Let's say 0.01% of the population controls (not even own) something like 30% of the world assets, we are looking at 70 million people worldwide. No "conspiracy of rulers" can be that large, ever.

This are simpleton theories to try to comprehend why capitalism, naturally, tends towards oligarchy if unchecked by simple trickle up economics and capital accumulation. Even the super-rich are not an uniform class neither regionally and much less so internationally. This does not mean that there is a political capture of the system, but that's what oligarchy is.

Even in way smaller civilizations like the Roman empire you had a lot of antagonistic interests amongst the uber-rich and there wasn't consensus over everything and every policy. But there is so much one person can do, in the end EVERYBODY is subject to forces beyond their control, even if it's only (specially) social forces.