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And that's the problem right there.

Speculation is economically destructive. There's no complicated theory to this. Either you're building useful stuff, or you're gambling and making shit up to no useful purpose.

You can of course do both. If wind farms had been built, there's no guarantee that there wouldn't have been a wind farm bubble - like the dot com bubble, or the rail bubble, or the defence bubbles, or the tulip bubble.

Bubbles and crashes will keep happening until accounting models make an explicit distinction between casino speculation and useful investment.

My prediction is that if you eliminate casino speculation to the maximum practical extent, you'll have a much more stable, prosperous and productive economy - for everyone except the speculators, who will be forced to get a proper job.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Jun 22nd, 2011 at 01:36:11 PM EST
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