patrick.net

That's part of the argument against the financial industry as it currently exists. Traditionally, the function of finance is a support industry, and it should be a relatively boring business. What they should be doing is lubricating other people's ability to engage in production, instead of supplanting people's ability to produce. Wall Street largely functions on rent-seeking and doesn't produce anything.

This is something I've wondered about myself and wouldn't mind being schooled either, (via a serious conversation, not a troll-induced diatribe) so thanks for creating this thread.

How about if all the "investment bankers" had to repay the World by hunting mines in a third-world shitholes...kinda like Bugs Bunny checking bombs with a hammer ?

ROLF says

Do these people really do anything useful? They certainly move money around and get percentages. School me !

It takes many some 4 years of education + couple of years of experience in the field to appreciate the system. And you expect some to just throw out a couple sentences as a reason.

Learn or Perish!

thomas.wong1986 says

Someone explain why they don't suck ! !

It takes many some 4 years of education + couple of years of experience in the field to appreciate the system. And you expect some to just throw out a couple sentences as a reason.

Learn or Perish!

So, here's the thing. No matter how you cut it, they ARE a support function. They do not produce anything.

However if you are educated and competent in other fields you are subject to relentless pressure to do it cheaper. You just spent 5 years getting a Computer Science degree, so what we can get a guy from Bangalore who can do it cheaper than you. There is not really any meaningful pressure like this on Wall Street. There should be.

You got us a bond deal with a 1.4 million dollar slice for yourself last year? Great next year you need to do it for 1.0 million. And every year after that until they scream. To my mind a lot of it is they are so good at SALESMANSHIP they steamroll right over their customers watching the overhead costs by overstating the possible profits they might reap.

Wall Street exists to lever up a single unit of currency into as many as possible to preserve the AAA risk rating.

Someone might dig into their books and find they're like Lehman and levered 150 to 1.

They do a lot.

Wall street exists to screw the Main street.

Wall Street was created to generate payroll for the 13 Colonies.
Where the French, Dutch and England would bid on our indigo, grain, and tobacco. Less we perished on our own.

It creates market efficiencies by investing and specializing. Of course the gambling part of it where people bet against/for stocks I'm not crazy about.

Define wall st.

Most cities have a financial district with a stock exchange Wall st is simply the biggest area of the largest exchanges.

Yes Chicago has the CBOT but that's commodities.

Sometimes companies go public because they might not have enough funds to create projects to completion. The concept of a corporation goes back I think around 150-160 years. Now one can argue that at a given point that businesses were designed under a charter and served a single purpose (to build a road, bridge, gas lighting etc) and usually dissolved upon completion.

Because of both consumer demand and the amount of jobs that would be lost there is no real reason for a company to pretty much dissolve itself. It can pull out of a market (Packard Bell comes to mind..then again so does Fiat).

There are plenty of industries that do not create a physical product. Music is downloaded these days, one could say that with high end hdtv's it could mimic a portrait pretty well...heck government itself is not a producer of goods within the private market.

Without Wall Street most of us would not have jobs because the companies that we work for more often than not trade and raise capital on Wall Street. That and people ( like me at least) invest in those companies.

edvard2 says

Without Wall Street most of us would not have jobs because the companies that we work for more often than not trade and raise capital on Wall Street. That and people ( like me at least) invest in those companies.

Yes, but do you need Wall St. to have a stock exchange? It's a very small percentage of people working on Wall St. that do the essential functions necessary for companies to raise capital.

edvard2 says

Without Wall Street most of us would not have jobs because the companies that we work for more often than not trade and raise capital on Wall Street. That and people ( like me at least) invest in those companies.

With out wall street most of us would have jobs we or someone we know created.

edvard2 says

Without Wall Street most of us would not have jobs because the companies that we work for more often than not trade and raise capital on Wall Street.

Right, no one disagrees that true and traditional "investment banking" is a necessary function. But Wall Street does a ton more than that, and most of the other stuff they do is destructive to our economy and doesn't produce anything.

corntrollio says

But Wall Street does a ton more than that, and most of the other stuff they do is destructive to our economy and doesn't produce anything.

And the compensate themselves handsomely while they are about the business of our destruction.

I heard hedge fund managers will be profiting from F&F excess inventory soon. This country is just plain sad.. I know this is days old news, but it irked me big time right away when I first heard it.

http://www.marketwatch.com/story/us-moves-to-sell-rent-92000-foreclosed-homes-2011-08-10?reflink=MW_news_stmp

I believe if you go to Wall St. any day of the week you will find some kind of protestor out front for sure.