The Cost of Financialization-Globalization: You Lost $500k and Gained $137.13
This really is a terribly written article, wouldn&#x27;t get a passing grade for a high school student. There&#x27;s absolutely no coherence to any of the arguments, it&#x27;s just a rant and poor understanding of finance. I&#x27;d like to be more concrete in my criticisms but honestly I don&#x27;t even know where to start.<p>There&#x27;s an idea about financialisation, which is just completely wrong: he notes companies are willing to pay $20 billion for a $10 billion company, after selling it off for its pieces, and noting no value has been added.<p>Typically the reverse happens, companies get merged for economies of scale, thereby adding value through efficiency.<p>Sometimes companies are broken up because the individual pieces don&#x27;t work well together anymore and create strategic issues, e.g. because a company has two units moving into two different directions, and require completely different strategy, people, ideas, customers, financing approach etc. e.g. a newspaper company that has a journalist branch that produces news, and a factory branch that produces printed (news)paper. That may have worked before. But in a digital age, journalists want to focus on news, and paper printing businesses on paper printing. You can lose value by tying these companies together under one CEO, one strategy, one financing model. You can add value by disentangling, letting them focus on their core business.<p>The notion you can routinely magically just sell for 20 billion, what you purchased for 10, without adding value, is I hope obviously nonsense.<p>Then there&#x27;s a whole piece on globalisation... again, not sure where to start. The big claim is it reduces quality and this is a net loss for everyone, and that second, personal income has been dropping for decades. In reality, quality changes are well studied and part of inflation data, and personal income after inflation adjustment has been increasing for decades. [0]<p>[0] <a href="https:&#x2F;&#x2F;fred.stlouisfed.org&#x2F;series&#x2F;RPI" rel="nofollow">https:&#x2F;&#x2F;fred.stlouisfed.org&#x2F;series&#x2F;RPI</a>