Functionnaly, the role of banking and financial markets in our large capitalist societies is the optimal allocation of real world resources. In other words, it is the industry in charge of establishing and putting into practice the plan. (This is how I justify my working in banking to my extreme leftist consciousness). Well, the impressive growth of banking is the same symptom as the growth of the Plan in the Soviet Union, and wealth capture by the nomenklatura in that place ; the deciders are improductively getting the larger share of production. The results will likely be the same. Un roi sans divertissement est un homme plein de misères
That's also why computers have increased productivity in banking so much : automating bureaucracy is what computers do best. From the point of view of the computer programmer in banking, the amount of bureaucracy going on is staggering ; most computer power is used to do daily, monthly, quaterly and yearly reports...
Also, the amount of money traders can put in their information systems is astonishing, compared to "industry", i.e. the real world. It feels that the IT teams could double in size overnight and it still would be felt. (I also will remember for quite sometime the sentence I saw in an email, saying 200k€ was less that a pen's width...)
As a side note about bureaucracy : it is now considered equivalent to government, a great victory of the neolib view. That's false and need to be repeated : bureaucracy still exists in the financial world. Indeed, I think our PDG is a dozen hierarchical levels above me... Successful companies can afford to be much more wasteful than any government, and often are. Un roi sans divertissement est un homme plein de misères
