Impact of Finance

I have been following this great multi-part project at The Washington Post on the declining middle class.  The latest piece struck a chord with me.  I lean left - I generally believe people are good, and that many need assistance when times are tough.  Assistance is not only necessary, it is a core component of what makes us human.  Fraud happens, but that should not distract us from helping our fellow neighbor.

I am now in the finance world.  I get more and more exposure each day of the machine that Mr. Tankersley describes in the article above.  So, knowing this, I have a quibble with this article.  It is extremely narrow-minded.  To measure the impact of finance solely by it's contribution to the economy is myopic.  Such an analysis negates all the externalities that occur given the growing investments in finance.

As I marinade on the system that is finance, we are benefiting elsewhere by the development that has occurred over the last few decades.  In particular, I argue that the growth of the internet as a foundational contributor to our economy is directly tied to the learnings, development, and talent cultivated throughout the recent finance evolution as Mr. Tankersley describes.

The metaphor used in the article, that finance is like a plumbing system enabling capital to move from those that have to those that need, is directly akin to how many describe the internet.  The exorbitant growth of the finance system in recent decades has led to new technology discoveries and an emerging talent pool - assets that are rapidly transferring to other industries.

Take data intelligence, for example.  Over the last decade, we have seen hyper growth in the amount of structured data, given the growth of the web and other advancements.  Vast datasets are becoming accessible for analysis in numerous industries, from commerce to education to even government.  Many of the technologies to handle these vast datasets are rooted in finance, as are many of the early people, transferring their knowledge and experience.  And growing the economy...