In earlier posts I noted that even if “Wall Street” is temporarily saved and more carefully regulated, it will be difficult to prevent a meltdown similar to the current one from happening soon again. The reason is that it will be impossible to prevent new risky ways of playing tricks to obtain high returns by manipulating digital money streams. This is under way already. Banks have found apparently legal ways to cook their books to make it look as if they are very profitable, when they still have plenty of toxic assets. This allows them to plan large bonuses so that their “talented” employees don’t head off to greener pastures (or pig farming). Paul Krugman has pointed out the dishonesty in this, but can anyone prevent this kind of shell game? The more it is played, the faster money in any form will cease to be useful. …
Here comes Facebook feudalism! …even sooner than I expected.
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