Moral and Social Impacts of Financialization

Published on
August 20th, 2018
27 minutes

Moral and Social Impacts of Financialization

The Exchange ·
Featuring Grant Williams, Simon Mikhailovich, and Dan Oliver Jr.

Published on: August 20th, 2018 • Duration: 27 minutes

Does prolonged misallocation eventually distort the moral and social fiber of political systems? In this third and final installment of their "Exchange"series, Grant Williams, Simon Mikhailovich and Dan Oliver tackle this controversial but compelling topic, drawing on historical anecdotes to make some uncomfortable comparisons with past periods of profligacy and excess. Filmed in on May 8, 2018 in New York.


  • DL
    David L.
    18 April 2019 @ 11:22
    Terrific series - lots of good ideas and insights. Since this is historically based, how about a follow up on how people have dealt successfully with past cycles ending.
  • SU
    Shakeel U.
    2 November 2018 @ 23:26
    Brilliant, Grant Williams asks great questions, 10/10.
  • KC
    Kenneth C.
    18 October 2018 @ 18:21
    This 2-parter was very good. I've come back to suggest a different one. Raoul with Lacy Hunt and Jeff Snider on the debt and economic crisis we're headed into.
  • DR
    Dick R.
    21 August 2018 @ 03:15
    This conversation was a disaster......It was so completely wrapped up in gauzy platitudes, false comparisons and ineffective conclusions. It completely sabotaged any wisdom expressed in the first two videos......Specifically, the fatuous binary opposition of capitalism and communism, as if there were nothing in between and nothing one can learn from the other was a complete wipeout......Innovation will feed starving families? On what planet? They have a habit of dying in place before Tang gets invented.....This is the type of cliche-mongering that stops thought, not starts it......If rich people had any particular expertise in morality, Jesus wouldn't have been so rude about them.....And the next time you tape fatcats opining on the "little people," clear the food service away so we don't wind up staring at their groaning table.
    • SM
      Simon M. | Contributor
      21 August 2018 @ 18:52
      Dear Dick, Reasonable people can disagree and I accept your views at face value. However, you made a few specific comments that deserve a response. 1. You said that capitalism and communism could learn from one another. Really? Capitalism is an economic system whereas communism is a socioeconomic totalitarian political philosophy. Unlike capitalism, economic communism is an idea that has never been implemented, despite 70 yrs of attempts. As to political communism, wherever it was tried, it has either ruined or extinguished millions upon millions of innocent lives, including the lives of my family members. 2. In regards to your comment about fatcats opining on "little people," until I was 10, we lived in a 4th floor walk up five room apartment where my parents and I shared a room. The other four rooms were occupied by other families. The apartment had one indoor toilet but no hot water, no bath or shower, no refrigerator and no heating, aside from the fireplaces. Afterwards, we moved to a 400 sq ft two room apartment with basic conveniences, which felt like living in a palace. I came to the US in 1978 with $100 + one suitcase and no citizenship. Enough said. 3. You felt offended by the food. Ok, that was a distraction. Still, I doubt that you or the other RV subscribers are missing any meals so as to be offended by some cold cuts. 4. The tone of your invective reminded me of this popular communist poem, with which you seem to agree: Eat your pineapples Chew your grouse Your last day is coming You bourgeois louse. -- Vladimir Mayakovsky
    • CT
      Craig T.
      21 August 2018 @ 19:17
      Dick, your comments suggest you didn't understand what you heard. Or didn't hear what you didn't want to hear. Too bad. This is a lot to think about, crammed into 30 minutes. BTW, I agree the food is a distraction.
    • DR
      Dick R.
      22 August 2018 @ 21:22
      Dear Simon, there is an impassible gulf between Karl Marx and Bernie Sanders. Political economy is a continuum, not a simplistic Manichean struggle between light and darkness.....Capitalism is as prone to abuse as any other system. There is no morality in "Winner take all." It is as much an abomination as any Marxist slogan......Re-examining capitalism the way it is practiced today is not communism, it is a moral imperative......If my words remind you of Communism, that is your own private association and it seems totally nonsensical to me. There are no communists paying the big bucks to subscribe to this service. Such a ridiculous charge is calculated to shut down thought, not stimulate it......Anything taken to extremes can be toxic, and capitalism is not exempt from that.
    • DR
      Dick R.
      22 August 2018 @ 22:24
      On reflection, the major fault may be in taking the conversation in this direction. A great talent in one field does not necessarily transfer to other fields. Should we look forward to a star-studded panel of philosophers and theologians giving their insights into Emerging Markets and the Yield Curve?
    • SM
      Simon M. | Contributor
      23 August 2018 @ 17:02
      Dear Dick, You thoroughly misconstrued my views, which are based on Alexis de Tocqueville's credo: "I have a passionate love for liberty, law, and respect for rights. I am neither of the revolutionary party nor of the conservative....Liberty is my foremost passion." The system in which we live now is no more "capitalism" than the system in which I grew up in the USSR was "communism." Reality is never that simple, which is why political labels, slogans and talking points are the tools of confusion, not insight. It is not feasible to have a substantive discussion in this forum and so I would live it here. Thank you for your engagement.
    • WM
      Will M.
      24 August 2018 @ 16:19
      Dick R, you clearly got out of bed on the wrong side today. I think the discussion was fairly straight forward and I think you read too much into a 30 min slot. I think the quality of the discussion is clearly reflected in the massive thumbs up vote. However as one of the 10 or so who down voted the segment it was good to read your opinion.
    • DR
      Dick R.
      29 September 2018 @ 05:22
      Ayn Rand escaped brutal Soviet tyranny, and famously preached a horror of collective consciousness in all forms. Yet when she fell ill, she signed up with Medicare. Let us all short Stalin by all means, but beware of going long with Marie Antoinette. That's a very dangerous trade these days.
  • RR
    Robert R.
    29 August 2018 @ 17:49
    Superb. More please. A segment, as Grant says, on what we can do would really help. And if you tell me to hold cash, tell me how. I am not going to put it in the banks. Then, it's theirs, not mine.
  • CA
    Craig A.
    29 August 2018 @ 12:56
    really good series. Loved the debates and all points were well articulated. Please have more of this type of content
  • CR
    Cristian R.
    20 August 2018 @ 09:27
    My three favourite gold bugs.
    • DB
      Douglas B.
      20 August 2018 @ 19:16
      Excellent students of history, however I hope, for their sake,that they begin to realize that crypto/bitcoin is the new gold.
    • WM
      Will M.
      24 August 2018 @ 15:40
      You are dreaming Douglas. Governments can easily halt crypto at will and can be expected to do so the minute it threateners their control over money transfers. Try holding a like bar of gold in your hand....then look at the account ledger for your bitcoin. No comparison. Crypto currency is just another fad until nations decide they want everything to be electronic and can fully manage and tax crypto.
    • WM
      Will M.
      24 August 2018 @ 15:41
      not "like" but kilo!
    • TM
      The-First-James M.
      28 August 2018 @ 02:23
      Will M. Governments can declare Crypto illegal at will. When it comes to enforcing that illegality though, good luck - especially if holders are properly motivated. The problem with Gold is if you suddenly find you own it in an unfriendly jurisdiction, it could be a real b**ch to get it out to somewhere more friendly to monitise. I recall reading from an Indian Gold Smuggler being quoted in a UK newspaper that 800g is about the limit you can stuff up your rectum without the weight of it affecting how you walk. Bitcoin is a little easier to extract to a friendlier jurisdiction. To stamp it out entirely would require inter-governmental cooperation in a World that is seemingly becoming more politically fractured by the day. I therefore suspect it won't be feasible. I speak as somebody who holds both Gold and Bitcoin - the former across multiple jurisdictions, just in case.
  • JH
    Joel H.
    26 August 2018 @ 00:00
    Like the format and the content!
  • CB
    Chris B.
    25 August 2018 @ 21:06
    Great content and great format. I really enjoyed the interaction of these three smart guys. Also, I always enjoy Simon’s views based on his history of spending part of his life in the Soviet Union.
  • WM
    Will M.
    24 August 2018 @ 16:08
    Great discussion if a bit more philosophical that the previous sessions. Having been around as an adult since the 70s I have personally witnessed the move to a credit / debt based economy. For my first credit card I had to meet with my local bank manager who advised me about the perils of lack of financial control. Nowadays, or at least back in the 2000s, credit cards were handed out like confetti to individuals who should never have been given them, let alone mortgages.... As a young boy and even through my teenage years I deferred to adults and especially the older generation; nowadays many youth have little respect for their parents grandparents or anyone else apart from "media stars". Luckily I got a good education from my grandmother on the depression in the UK in the 30s. My parents never had a lot of money but I was given a good grounding in saving and not spending. People who deny the lessons of history will be caught short and unfortunately will likely vote to take the wealth from others in the name of socialism. Dan's comment about the last resort of going to war is exactly where we are heading. Iran, Syria, Turkey, North Korea and perhaps soon....China. There is plenty of scope for our next US led war. Its coming folks......
  • MT
    Mark T.
    24 August 2018 @ 16:04
    You've hardly touched that nice charcuterie spread this whole series!
  • EL
    Edward L.
    24 August 2018 @ 13:57
    Thank you so much for a dispassionate discussion which helps to relieve some of the feelings of isolation many of us feel with the increasing amoral populist movement which stresses the "I" over the "We" and immediate gratification over dedication to delay for the common good. Also, did you ever finish eating the food?
  • TL
    Tom L.
    23 August 2018 @ 20:31
    I'm only half way through and it's been a great read. But I feel as though the banks are taking all the blame for this. I'm not saying the banks are innocent because it's clear they're not but what about the individual person having accountability? No one will take the wheel of their own life and they rely on someone else and when that doesn't work out for them which appears to be 100% of the time, they put all the blame on banks and they want to be bailed out.
  • PW
    Peter W.
    22 August 2018 @ 08:15
    I am so pleased that RealVision dropped to a sensible price, and I can now afford commentary and analysis of this quality and level of insight. Please keep it coming.
  • DS
    David S.
    20 August 2018 @ 23:44
    Mr. Mikhailovich it is morality that breaks down first not finance; everything else easily follows. Grant's comment on consequences has always been key. If a robber knows that he will be caught, he will probably not rob. The world has always lived with men/women without shame, but the percentage today is past the critical point for society to function. DLS
    • CM
      Christopher M.
      21 August 2018 @ 15:12
      Finance broke down in 2007.
    • JM
      John M.
      22 August 2018 @ 05:13
      I think in some cases morality breaks first but not always. Suppressed interest rates (finance policy) will gradually erode savings (morality of saving).
  • Sv
    Sid v.
    21 August 2018 @ 20:25
    History rhymes. excellent piece. No real investment advice, but still a great series.
  • SS
    Steven S.
    21 August 2018 @ 20:06
    you are nothing more then a Capuchin Monkey in a grand Federal Reserve experiment........and we are in 'BEGINNING' of the late stages of the experiment..... . . Two Monkeys Were Paid Unequally: Excerpt from Frans de Waal's TED Talk
  • BC
    Brente C.
    21 August 2018 @ 15:21
    This was one of my favorite Real Vision segments because it incorporated human nature and societal impacts into the larger economic discussion. They are all related. Particularly, the detrimental impact of a society which does not have the incentive or capacity to save (delay consumption now for a better benefit later) is one that becomes engulfed in a debt trap that leads to damaging political extremism and war.
  • DS
    David S.
    21 August 2018 @ 00:49
    The best way to prepare for the future is to establish moral norms through laws and personal responsibility that are enforced. I am afraid this is just not going to happen without big brother. Our first instinct is to rationalize our current prejudices and stop thinking. We refuse to look at other’s points of view. We promote what we think – often wrongly - is in our personal self-interest and damn the consequences to others. I hope the rest of you are more optimistic than I am. DLS
    • MZ
      Martin Z.
      21 August 2018 @ 08:23
      Codes of ethics and moral standards to live by are not demonstrations of integrity but evidence that it has already been lost.
 - Laurence G. Boldt
  • GO
    Gary O.
    21 August 2018 @ 04:11
    Great conversation. Nobody learns from history except these guys. Don't worry, it will be different this time!!
  • NI
    Nate I.
    21 August 2018 @ 03:56
    The student debt binge is particularly troubling in the context of the proletarians have nothing to lose but their chains. If we were to forgive one debt at taxpayer expense, that might be the one, provided of course that post-jubilee, student loans would no longer enjoy taxpayer underwriting. Sanity would be restored to higher education and tuition would drop overnight to formerly sensible levels.
  • RH
    Rick H.
    21 August 2018 @ 02:47
    Thank you for delivering this variety of content
  • JG
    Jory G.
    20 August 2018 @ 20:08
    Very good discussion. Situational ethics along with political polling are curses upon any nation. That combined with the self deception of many leaders that they know best how to manage our lives will no doubt have some unpleasant consequences whether they believe so or not.
    • DS
      David S.
      21 August 2018 @ 00:53
      I do not believe current leadership even cares what is in the country's self-interest. Many on both sides cannot see beyond personal self-interest. DLS
  • PD
    Peter D.
    21 August 2018 @ 00:21
    Morals? Where have I heard that word before? (Reaches for dictionary....)...
  • AL
    Andrew L.
    20 August 2018 @ 12:27
    I would recommend the Grant Williams In Conversation 2 part conversation with Anthony Deden. The perspective of inter-generational wealth preservation. It has had a big impact on the way I think about my finances and as a new father it has really changed how I think about what I want to do with money. I want to teach my children values, I want to teach them to teach their own children and I want to build something that I can hand down to them which they can continue to build up and hand on to their children as well. This is an antithetical perspective today.
    • CC
      Christopher C.
      20 August 2018 @ 13:39
      Hear hear!
    • DB
      Douglas B.
      20 August 2018 @ 19:01
      Agree that it is best to teach them sound principles by living by example. That’s the best gift they could receive. Handing over to them what you have built teaches them a completely different lesson imho.
    • AL
      Andrew L.
      20 August 2018 @ 23:43
      Douglas - should I just sell the family business and spend it all before I die then? Inter generational wealth is not about silver spoons it’s about building something of real value that lasts and is a virtue for many generations. The heirs bear great responsibility to the next generation. Watch the Deeden interview when he talks about the fig farmer. They take many decades to to yield salable fruit. That’s the kind of mentality I am thinking of.
  • PG
    Philippe G.
    20 August 2018 @ 23:14
  • CC
    Charles C.
    20 August 2018 @ 22:56
    fantastic series with great historical background. This plays to my biases but the concerns are very real.
  • KJ
    Kelly J.
    20 August 2018 @ 18:42
    Great, to the point, discussion of what's going on in the big picture! Dan Oliver's view that innovation can solve the planet's Maltusian resource problems of exponential population growth and an economic system utterly dependent on exponential growth is a comforting fantasy, but IMO very much wistful thinking for the coming years as population arcs past the current 7.4 toward 9 billion. As it has remarkably to date, innovation will continue to mitigate some resource issues (agriculture, shale energy extraction, etc.) but is already being overwhelmed, just as it's likely that our governance and incentive systems, whether free market capitalist, socialist, etc. all tend to devolve toward concentration of wealth and power, stagnation and corruption, and then be overwhelmed and tossed aside as they fail to serve the "masses". We're going to need to evolve completely new economic/political/organizational systems, maybe from some hybrid of the old, if civilization is going to evolve. Given the utter failure of our current system to intelligently acknowledge and address issues like the corrupt, ponzi-finance playground breeding inequality, oil depletion, energy resource transition, water depletion, climate change disruption to food production and the global supply chain, etc. I expect major social disruption, conflict and loss of life to be a big part of the story of how population pressure is resolved in coming decades. As you discuss, corruption leads to disorganization and destruction at a social level, and that seems tough to avoid now.
    • AE
      Alex E.
      20 August 2018 @ 21:20
      Except that the so-called "over-population" of the planet isn't going to happen because 1/3 of the Earth's population will be dead by 2050!
  • V!
    Volatimothy !.
    20 August 2018 @ 12:16
    Owners of capital will stimulate working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks which will have to be nationalized and State will have to take the road which will eventually lead to communism. Karl Marx
    • AE
      Alex E.
      20 August 2018 @ 21:14
      Yeah, that sure worked for Russia, didn't it???
  • CB
    C B.
    20 August 2018 @ 19:53
    Where's the trade on Google? Just kidding, just kidding! Interesting conversation. I have been thinking a lot recently about morality as it is related to investing. I have thought that perhaps using my moralistic framework to think about how the future may play out is actually an inhibitor to accurately predicting the future and positioning correctly. The discussion around repercussions therefore is especially helpful. Perhaps penalties for bad behavior like loss of capital or jail will return and thereby reward prudent actors. On the other hand, a descent into some dystopian future where extractive, scam business models dominate can not be assigned a probability of zero. Thank you for the dialogue!
  • MM
    Mike M.
    20 August 2018 @ 12:21
    Very good. The 99% are only interested in Fantasy football and where they are going to eat next weekend. We have a generation 18/30 who have no idea what an interest rate is. Debt has become the new standard of prosperity. We have become a nation of tax donkeys and debt slaves. As you note this is not going to end well. It is no longer a question of direction but rather when?
    • DB
      Douglas B.
      20 August 2018 @ 19:13
      Modern propaganda and marketing methods are highly effective in getting the populace to believe and do what others want them to do. The majority of the 99% have no idea that they are even brainwashed. This will not end well.
  • MT
    Morgan T.
    20 August 2018 @ 18:57
    3 episodes later...if you're not gonna eat that antipasti send it my way will you? Love the format btw!
  • my
    markettaker y.
    20 August 2018 @ 17:48
    Preach! Love this stuff. You'll all be vindicated, no matter what the Mark Dows of the world say.
  • IF
    Ian F.
    20 August 2018 @ 17:17
    Damn fine looking cheese board.
  • OS
    Oliver S.
    20 August 2018 @ 16:54
    A really interesting collection of viewpoints. Great stuff.
  • MH
    Mark H.
    20 August 2018 @ 15:19
    I can not exaggerate how greatful I am for Real Vision. I'd go nuts without it.
  • EF
    Erik F.
    20 August 2018 @ 13:57
    The last segment labeled "Turning Points" reminds me of Taleb's book "Skin in the Game"
  • CC
    Christopher C.
    20 August 2018 @ 13:31
    Hmmmm From Marx's letter to Kugelmann. "Joking aside, great progress was evident in the last Congress of the American "Labour Union" in that among other things, it treated working women with complete equality. While in this respect the English, and still more the gallant French, are burdened with a spirit of narrow-mindedness. Anybody who knows anything of history knows that great social changes are impossible without the feminine ferment. Social progress can be measured exactly by the social position of the fair sex (the ugly ones included)." To the last point... Perhaps we have arrived?