charleshughsmith.blogspot.com / CHARLES HUGH SMITH / SUNDAY, MARCH 23, 2014
Financialization results when leverage and information asymmetry replace innovation and productive investment as the source of wealth creation.
Emmanuel Saez and Thomas Piketty are leading lights in the exploration of rising wealth inequality. Both are academic economists who have devoted considerable time and effort to assembling data that deepens our understanding of the issues.
For example, Saez’s recent essay Striking it Richer: The Evolution of Top Incomes in the United States, provides an in-depth look at the widening gulf between the top 1% and the bottom 90% from 2009 to 2012.
Here is a chart of the top 10% share of income, based on their research: (the note in red marking the beginning of financialization in 1982 is my own)
