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Comment by paganel | Hacker News Reader

> If even the Swiss can't keep it together financially we're in real trouble.

Eventually all financialized systems go the way of the dodo bird.

The Republic of Genoa is the classic example for this, as they had made their fortunes via trade (including slave trade) starting with the 1200s, but by the 1500s almost all of their wealth-creation had started to rely on providing "financial" services. And then they crashed. I'm also of the opinion that the UK's problems are caused by the same phenomenon, that's why they have never quite recovered from the 2008-2010 global financial crisis.

Afaik Switzerland is not yet a fully financialized economic system but it's certainly up there. The future will be interesting for them.

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Finance and investing is largely based on trust in the future. I wonder if a long enough period of stability makes us too comfortable with taking risk and bad investments, only to expose us to massive downside far enough down the line. Then the inevitable black swan event happens, and finance/investment based wealth gets wiped out.

It doesn't help that the mind set a successful trader or banker needs is how to maximize their own net worth - not how to build a long term stable and profitable business.

"Finance and investing" are basically just gambling. You might as well bet on horses, dogs, cards, or crypto.

Money is neither a thing nor a limited resource. Money is a political tool certain groups use to ration power and accountability. It used to be based on scarce objects, but now it's pure abstraction.

An important part of that is making sure insiders have special opportunities and backstops most of us don't. For the real insiders it's a rigged house. And for the most inside of the insiders it's impossible to lose more than token amounts.

You can be sure that whatever happens to banking, there will be people whose gambles will somehow miraculously be made whole while the rest of us are told "Oh dear, suddenly there is no money. Again."

Gambling means you have guaranteed net negative return because you’re against the house and the rules of the house are designed in such a way, mathematically speaking.

Trading mortgages, financing a building, betting that an airline will have a bad quarter after the first WW lockdowns of covid, can have a net positive return. you are playing player vs player and you bet and structure the trades trying to get the odds in your favor.

they’re two different things, you just seem ignorant.

not to mention other uses of finance such as edging. farmers, companies of sll kinds, even countries, want and should edge their wipe outs and black swan events type of risks for example. and a Citedel will happily underwrite your options.

> Afaik Switzerland is not yet a fully financialized economic system but it's certainly up there. The future will be interesting for them.

Too late. I can't find the data at the moment, but deposits in Swiss banks are more than 400% of GDP. (The US's economy is about the least reliant on financials, with deposits at slightly more than 100% of GDP.)

Found the data, from Swiss National Bank itself. Switzerland's banking assets are 520% of national GDP, compared to US's about 120% GDP. <https://www.snb.ch/en/mmr/reference/stabrep_2022/source/stab...>

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