Lecture notes 3:21

Lecture notes 3:21 - -Shift into financial forms of profit...

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Corporate finance: -Bank Loans: -Corporate bond: Want to be confident that it’s a safe deal, because if business goes bankrupt, they won’t pay you back. Issued to anyone who wants to purchase it -Stock (equities): Investing ownership. -Other investments: -Derivatives (futures, options, swaps) -Betting on the price in the future -Can bet on anything, literally: Oil futures, mortgage backed securities, etc. -Financial weapons of mass destruction- Warren Buffet -If we didn’t control how they were regulated, leads to big collapses of financial systems Financialization -1980-Present (neoliberalism) -Deregulation of financial markets -No sort of rules over how much banks need to keep in reserves -Massive growth of financial sector
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Unformatted text preview: -Shift into financial forms of profit making-Best and brightest going into financial sector, instead of other jobs-Speculative accumulation (M-M’)-Like a Casino Everyday Financialization-You can be an investor-In the past it was a profession, you trained to be on Wall Street-Everyone is expected to be a good investor of his or her savings-Debt-Pensions:-Pay-go (government)-Pay out benefits from current revenues coming in-Pre-funded (private sector)-Set aside your own money-Pooled and invested into Mutual Funds-Two types-Defined Benefit Plans (Fixed what you’re going to get)-Defined Contribution Plans (What you get when you retire is totally open)...
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