Reprinted from http://www.oftwominds.com/blogfeb14/tech-risk2-14.html
What else can we do with the $1.25 trillion we'll save by eliminating these obsolete financial middleman parasites? A lot.
Technology has leapfrogged the banking sector, rendering it as obsolete as buggy whips. So why are we devoting 9% of our economy to an obsolete parasite? Financial sector profits now total a staggering 4.5% of GDP (gross domestic product), while the expenses generated by financial churning account for another 4.5% of the economy.
chart courtesy of Market Daily Briefing
Software and existing non-Wall Street/too-big-to-fail
institutions could replace the entire Wall Street/banking sector and drop costs
to .5% of GDP, saving us 8+% of our GDP
($1.25 trillion) that is currently siphoned off by parasitic middlemen. The
banking sector is Exhibit A in the Middleman-Skimming Economy (February 11, 2014).
The pull of habit and propaganda is so strong that most people
haven't even recognized that software and the Web can replace the entire
financial/banking sector for a fraction of the cost of the current parasitic
system, a system that (as we all know) has captured
the regulatory and governance machinery of the central state, making a mockery
The benefits of eliminating the financial/banking sector are immense and far-reaching.
What exactly do banks do? Banks perform these basic functions:
1. They hold depositors' money.
2. They act as a clearing house for payments, transferring funds from payor to payee.
3. They issue loans on a fractional reserve basis, i.e. a few dollars in cash deposits supports $100 in loans.
4. They originate and
trade derivatives, run high-speed trading desks, operate various
money-laundering and embezzlement schemes, influence elected officials with
lobbying and campaign contributions and subvert both free market capitalism and
democracy at every turn.