I particularly found section 2.4 to cover something I've felt for a long time. The bottom line is we really need to reevaluate how the stock markets and finance work, and if they are working for society as a whole.
> This financialization of corporations, which sees enormous financial markets play an ever-increasing role in the economy, has exacerbated the focus on short-term profits over any longer-term goals. It has also directed investment away from productive uses, instead acting in the interest of extreme capital by reorientating many non-financial businesses increasingly towards financial instruments and activities.
Financialization of all human enterprises seems to be driving society towards a state where no actual productive work is done and instead companies become financial manipulation instruments. Eg Boeing outsourcing all plane manufacturing, airlines making most of their money from points schemes.
The report also covers that most equities are owned by the wealthy, something that refutes a common idea that somehow the "shareholders" benefiting from company greed are regular peoples' retirement funds.
> The super-rich are more likely to own corporations. In the USA, one of the very few countries for which there is regular data on the distribution of corporate equities, the richest 0.1% account for 19.8% of shares owned by households, the richest 1% own 44.6%, while the poorest 50% own just 1%.146 New research on 24 OECD countries found that the richest 10% of households own 85% of total capital-ownership assets – including shares in companies, mutual funds and other businesses – while the bottom 40% own just 4%.147
It also covers the phenomenon of index funds which is something I also am very interested in. The conventional wisdom for folks lucky enough to have excess money is to put it in index funds. Then you end up in a state where a fair amount of the companies in the world are effectively controlled by the wishes of a few index fund managers. It seems there must be a better way for folks to ensure their ability to retire comfortably.
> Beyond private equity, the ‘Big Three’ index fund managers – BlackRock, State Street and Vanguard – together manage some US$20 trillion in assets.218 Research suggests that this kind of market concentration reduces incentives for companies to compete and in turn deepens monopoly power.219 Together they control close to one-fifth of all investable assets in the world.220 Common ownership in so few financial firms undermines fairness across the economy.221 Further to this, Harvard research has argued that the economic power held by such index funds is so concentrated that ‘in the near future roughly twelve individuals will have practical power over the majority of U.S. public companies’, concerns that were previously echoed by the founder of Vanguard himself.