Saturday, March 13, 2010

economics vs. finance: a layman perspective

Some of my friends perhaps have already heard about this "perspective" from me. Okay, so here we go. What do you think are the differences between economics and finance?
  1. Who cause the latest slump? Irresponsible derivatives invented by financial engineers. Now, after the slump, who fixed everything? Economists.
  2. Economists work for the well being of the people, in a country, or in the world. Finance analysts, financial engineers, or whatever professions related to finance, they work for the well being of only some people or some parties at best.
  3. Finance: piling up wealth for some people while reducing other's wealth thereby increasing poverty and the gap between the rich and the poor.
Okay, what I wrote here is merely my own subjective opinion based on the facts that I have observed in the past few years, and of course people can argue that finance is not so much about increasing wealth on some people or some parties. Yes, there are personal finance, corporate finance, public finance etc etc. Furthermore, they are trying right now not only to transfer wealth, but how they can generate wealth.

These are further facts, but what I want to say here is BE RESPONSIBLE! Do not just create stupid derivatives in which yes, you can gather more and more money from that, but the consequences shouldn't be overlooked. Executive bonuses, do they really deserve those bonuses? I don't think so ... Those bonuses are too excessive!

Be responsible, and life is not so much only and only about wealth and money. There's something money can't buy! Or if you still think money can buy everything, re-think!

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