Financialization Impacts Economic Equality

Financialization is a trend in which risky financial markets, rather than just financial institutions, make up a significant percent of GDP. Analysts believe this trend is contributing to growing economic inequality.
--By Valerie Gomez

The financial industry is powerful and includes financial institutions, financial markets, insurance companies, real estate investors and the wealthiest individuals. Their policies and actions determine things like the direction of the flow of money, the amount of investments in employment growth, the abilities of businesses to startup and grow, and the growth or stagnation of the economy. All of these impacts add up in a way that determines a country’s economic inequality.

The emerging trend is continued growth in "financialization" in which risky financial markets control wealth, raising deep concerns about the full economic impact of a growing imbalance between a production economy and a financial market.

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