Business Books

The finance sector is too large; trading volumes are absurd – economist John Kay

(Click here for more business book reviews.)

Mike Wills played a snippet of the audiobook “Other People's Money: The Real Business of Finance” by John Kay and narrated by Walter Dixon.

Description on Amazon:

The finance sector of Western economies is too large and attracts too many of the smartest college graduates.

“Financialization” over the past three decades has created a structure that lacks resilience and supports absurd volumes of trading.

The finance sector devotes too little attention to the search for new investment opportunities - and the stewardship of existing ones - and far too much to secondary-market dealing in existing assets.

Regulation has contributed more to the problems than the solutions.

Why?

What is finance for?

John Kay, with wide practical and academic experience in the world of finance, understands the operation of the financial sector better than most.

He believes in good banks and effective asset managers.

However, good banks and effective asset managers are not what he sees.

In a dazzling and revelatory tour of the financial world as it has emerged from the wreckage of the 2008 crisis, Kay does not flinch in his criticism.

We do need some of the things that Citigroup and Goldman Sachs do, but we do not need Citigroup and Goldman to do them (and many of the things done by Citigroup and Goldman do not need to be done at all).

The finance sector needs to be reminded of its primary purpose: to manage other people’s money for the benefit of businesses and households.

It is an aberration when the some of the finest mathematical and scientific minds are tasked with devising algorithms for the sole purpose of exploiting the weakness of other algorithms for computerised trading in securities.

To travel further down that road will lead to ruin.

Listen to the audio for more detail.

Subscribe to our Business Wrap Newsletter

702 welcomes all comments that are constructive, contribute to discussions in a meaningful manner and take stories forward.

However, we will NOT condone the following:

  • Racism (including offensive comments based on ethnicity and nationality)
  • Sexism
  • Homophobia
  • Religious intolerance
  • Cyber bullying
  • Hate speech
  • Derogatory language
  • Comments inciting violence.

We ask that your comments remain relevant to the articles they appear on and do not include general banter or conversation as this dilutes the effectiveness of the comments section.

We strive to make the 702 community a safe and welcoming space for all.

702 reserves the right to: 1) remove any comments that do not follow the above guidelines; and, 2) ban users who repeatedly infringe the rules.

Should you find any comments upsetting or offensive you can also flag them and we will assess it against our guidelines.

702 is constantly reviewing its comments policy in order to create an environment conducive to constructive conversations.

Read More
How to make (young, increasingly populous and urbanised) Africa work

How to make (young, increasingly populous and urbanised) Africa work

The Money Show’s Bruce Whitfield interviews Brenthurst Foundation Director Greg Mills about his book “Making Africa Work”.

Will the ANC split? Will the DA rule? A Scenario Expert on the fate of the SA...

Will the ANC split? Will the DA rule? A Scenario Expert on the fate of the SA...

Scenario Expert Jakkie Cilliers discusses his book “Fate of the Nation: 3 Scenarios for South Africa's Future”.

Inequality is a choice, says famed economist Joseph E. Stiglitz in his new book

Inequality is a choice, says famed economist Joseph E. Stiglitz in his new book

Rapport Editor Waldimar Pelser reviews “The Great Divide: Unequal Societies and What We Can Do about Them” by Joseph E. Stiglitz.

4 global forces changing the world in ways we simply can’t intuit

4 global forces changing the world in ways we simply can’t intuit

Rise of emerging markets; the impact of tech on market competition, aging populations; accelerating flows of capital and people…

We interview the author of a book on how access to credit empowers and enslaves

We interview the author of a book on how access to credit empowers and enslaves

South Africans’ access to credit is closely tied to identity, status and a desire for upward mobility, says author Deborah James.

Most Influential Book of 2014: Capital in the Twenty-First Century (Piketty)

Most Influential Book of 2014: Capital in the Twenty-First Century (Piketty)

Gill Marcus calls it “one of the most important books of this century”. 5 thought leaders debate Thomas Piketty’s tour de force...

Popular articles
Struggles interracial couples still face

Struggles interracial couples still face

The Open Line took an unexpected turn when a caller in an interracial relationship shared how her father rejected her partner.

10 sexting tips on how to keep things spicy (and safe)

10 sexting tips on how to keep things spicy (and safe)

Interested in sexting but worried about the risks? Dr Eve has created a guideline to help you 'sext' in a fun and responsible way.

It's not the end of the road... Top tips to improve your matric

It's not the end of the road... Top tips to improve your matric

"Recognise that it’s not the end, it’s the beginning." Expert advise for school-leavers who want to improve their results.

Gospel singer Sipho Makhabane explains how Sfiso Ncwane died

Gospel singer Sipho Makhabane explains how Sfiso Ncwane died

Makhabane says Ncwane was feeling weak yesterday and his wife phoned paramedics to check on him.

Who is Advocate Tembeka Ngcukaitobi?

Who is Advocate Tembeka Ngcukaitobi?

The EFF lawyer stole the show during the state capture report court battle.

Meet the founder of Capitec Bank, named ‘Best Bank on Earth and Cheapest in SA’

Meet the founder of Capitec Bank, named ‘Best Bank on Earth and Cheapest in SA’

Michiel le Roux speaks about the fascinating story behind the little bank that has the Big 4 shaking in their boots.

3 easy questions could bag you R2000!

3 easy questions could bag you R2000!

WIN R2000! But only if you can prove you're a whiz of the MTN Biz Quiz by answering the following three questions...

Blesserfinder: Matching you with a sugar daddy near you

Blesserfinder: Matching you with a sugar daddy near you

Is social trend Blesserfinder, where girls are allegedly matching up with rich 'benefactors' in exchange for sex, a real thing?