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The Financialization Problem

Why does everything cost more while your paycheck stays the same?

The Symptom​

You feel it. Everyone feels it.

  • Food costs more
  • Housing costs more
  • Healthcare costs more
  • Education costs more
  • Your paycheck? Flat.

You're working harder than your parents did. Running faster. And staying in place.

This isn't bad luck. This isn't laziness. This is a system working exactly as designed — just not for you.

The Mechanism​

Money stopped funding real work and became a game unto itself.

For most of history, finance was a tool. You had savings, you lent them to someone building something useful, they paid you back with interest. Capital flowed to production.

Then something shifted.

EraCapital Flowed ToResult
IndustrialFactories, infrastructure, productionBroad prosperity
FinancializedFinancial engineering, asset inflationWealth concentration

The shift happened gradually, then suddenly:

  1. Stock buybacks became legal (1982) — companies buy their own stock to inflate prices instead of investing in workers or R&D
  2. Financial deregulation (1980s-2000s) — banks could gamble with deposits, create exotic instruments
  3. Central bank intervention (2008+) — money printing inflated asset prices, rewarding holders over earners
  4. Information asymmetry — insiders front-run every opportunity, retail arrives last

The score got confused with the game. Money was supposed to measure value created. Now money creates money — and the game is who's closest to the money printer.

The Numbers​

This isn't theory. The data is clear:

Metric1970s2020s
Finance share of GDP~4%~8%
Finance share of corporate profits~15%~30%
CEO-to-worker pay ratio20:1350:1
Home price to income ratio2.5x5-10x
Real wage growth (adjusted)PositiveFlat

Finance used to be a small slice serving the real economy. Now it's a large slice extracting from it.

Why It Matters​

This isn't just unfair. It's corrosive.

EffectWhat It Breaks
Talent misallocationSmart people go to finance instead of building things
Short-termismQuarterly earnings over long-term value
Standards decayCompetition becomes who can cut corners fastest
Trust erosionIf the game is rigged, why play fair?
Political captureMoney buys rules that make more money

The metacrisis — tech risk, environmental collapse, coordination failure — all get worse when capital flows to extraction instead of production.

The Alternative Exists​

This is not inevitable. The same technology that enabled hyper-financialization can enable something better.

Open rails instead of captured rails:

Captured SystemOpen Alternative
Information asymmetryTransparent on-chain data
Trust intermediariesTrust math (cryptographic proof)
Insiders front-runOpen access, same rules
Standards captured by incumbentsStandards verified by anyone
Value extractedValue created and shared

The blockchain's greatest potential isn't speculation — it's an immutable single source of truth for standards. When anyone can verify quality, competition rewards building, not gaming.

The Question​

This is a complex problem, not a simple one. There's no expert consensus. No best practice. Solutions require experimentation.

But the direction is clear:

Competition should lift standards, not lower them. Capital should fund production, not extract from it. The game should reward building, not gaming.

Are you willing to put your money where your mouth is?

What You Can Do​

  1. See the game — Read how the loop works
  2. Find your edge — Take the thought audit
  3. Join the coordination — Enter the mastermind

The infrastructure for a different game is being built. The question is whether you'll help build it — or wait until the old game finishes breaking.

Context​

Resources​