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Thread: Financial Sector Cost UK Economy ₤4.5tn Over 20yrs

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    Financial Sector Cost UK Economy ₤4.5tn Over 20yrs 
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    UK economy lost out on ₤4.5 trillion because of 'too much finance', study finds


    ?Finance curse? sucks talent and investment from other industries, costing ?67,500 per person over the course of two decades, say researchers






    The UK has lost out on a ?staggering? ?4.5 trillion over the course of two decades because of an oversized financial sector, a new study has found.

    The ?gravitational pull? of the City of London has damaged economic growth by sucking talent and investment from other productive uses such as manufacturing and research while inflating asset prices, particularly property, a paper from The Sheffield Political Economy Research Institute concluded.

    Between 1995 and 2015 this ?finance curse? has lowered cumulative GDP by 14 per cent compared to what it would have been with a leaner financial services sector, the researchers found.

    They drew on previous academic studies from economists at the International Monetary Fund among others, who observed that as the level of credit to the private sector increases it generally boosts the economy as funds are allocated to people and businesses that need it.

    However, once credit to the private sector reaches about 90 to 100 per cent of GDP this correlation begins to reverse, and further rises begin to drag on the economy.

    According to the new research, the UK, which has a very large financial sector, has foregone a ?staggering? ?4.5 trillion of economic growth ? equivalent to two and a half years of GDP or ?67,500 per person.

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    Debt/interest based finance (usury) is a parasitical industry that has very little good to show for itself.
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    Quote Originally Posted by treezy z View Post
    Debt/interest based finance (usury) is a parasitical industry that has very little good to show for itself.
    Absolutely - a sickening rentier industry which sucks capital and productivity out of the economy and wastes so much potentially productive human talent.
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