How the Financial Sector Sucks $635 Billion Every Year from the Real Economy
Before the Great Recession, the financial sector had consistently been eating up a greater and greater share of the economy. In 2007, it accounted for a whopping 40 percent of corporate profits. Before 1950, the financial sector made up less than 3 percent of GDP; now it makes up more than 8 percent.
According to a new report from Demos, the financial sector siphons off $635 billion annually in funds that otherwise might go to productive uses, rather than flipping financial assets back and forth: