Financialization and the Crisis of Real Economy Legitimacy

Financialization and the Crisis of Real Economy Legitimacy

Efficiency optimization is becoming a political liability.

Financialization promised a world where capital allocation would optimize productivity. Instead, financialization created a world where financial Pokemon787 login returns are optimized faster than real productive capacity can expand. The result is disillusionment and political rage.

Share buybacks replaced industrial reinvestment. Leverage replaced productivity. Cost cutting replaced innovation. And now electorates realize that the wealth creation expansion they were promised did not scale to their lives. Inequality is not just a moral failure — inequality is a legitimacy failure.

Governments around the world now face a political economy credibility crisis: how do you maintain support for market capitalism when most citizens believe the market no longer rewards work — it rewards balance sheet engineering?

Financialization was allowed to metastasize because states outsourced discipline to markets. Now states are forced to intervene again — industrial policy, price controls, antitrust surge, labor power return — not as ideological experiments, but as survival.

Private capital elites fear over-correction. Citizens fear non-correction. Politicians fear both.

This is the future conflict axis: who defines what growth actually means? Is growth financial return acceleration or productive capacity expansion?

If states do not redefine this — voters eventually will.

And when voters redefine it — the correction will be far more violent than technocratic adjustment.

By john

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