The global economy is changing. Rapid resource depletion and demographic reversal together with the lack of scientific advancement and genuine productivity improvement means that there is increasingly a shortfall of capital. Productivity is coming from deploying existing technology with the developing workforce rather than through new industry such as Nano or Bio technology where surely our future must lie. Instead the innovation over the last 20 years has come from the financial sector, enabling this inefficient use of the global balance sheet to go unnoticed, but behind the scenes building an inherent instability and risk.
Economic growth has come from factor mobilization rather than innovation, but it is now reaching its limit. Capital has to move ever faster in search of the next marginal resource to keep the illusion alive. The resultant boom and bust in different parts of the world, inflation and deflation in different industries and optimism and despair in populations is causing major social and political strains. Understanding the increased volatility of capital and then managing its effect on different societies is essential to peace.
The financial industry, which facilitates these capital flows, has to change with it. The stresses are huge and as we saw in 2008, no bank has the scale of capital required to withstand this move. Some even doubt the US economy as a whole has the capital to survive, and certainly not in its present format. Smaller economies are already being marginalized and the US dollar and all forms of paper money are being put to shame by gold, "the barbarous relic of past monetary systems" as the trust in government and fiat money gradually declines. Government does not have the mandate necessary for this kind of economy.
The structure of the global economy and world financial industry has to change. Profit rather than productivity is no longer an option; the pendulum has to swing back to the real economy and away from the financial industry. Massive wholesale restructuring is needed. You can either fight it as most of us will try to do, or you can embrace it and hopefully position yourself to benefit from the change. I want to be at the forefront of that change.