Is the finance industry "innovative"?
Younger generations want to be able to make an impact by being "innovative" and thinking outside the box. Wall Street has experienced talent lost to Silicon Valley because talented grads today believe that tech offers them the chance to "think outside the box" and to "build things" of tangible values. Sure, finance plays an extremely important role in society/economy but do you really need a genius to plug in numbers into an excel spreadsheet? A lot of grads think that working in finance is like being part of an "assembly line", following orders and doing essentially same tasks over and over again. Is there opportunity for monkeys to be innovative in this sector? Is talent being thus wasted if someone who is smart and creative takes Wall Street over Silicon Valley? The nature of the industry now seems that it doesn't value individuals who "think outside the box" and provide creative advice. Is this going to change in the future?
Not really
Is innovation inextricably tied to finance? (Originally Posted: 03/05/2012)
from ted conversations, thought this was an interesting question worth discussing more:
one response:
Thoughts monkeys? True/false that true innovators do not participate more than superficially in the money game?
http://www.ted.com/conversations/334/is_innovation_inextricably_tie.html
Andy I think mfriedman should do a biographical interview for you :) or you should post your story!
For the most part I agree - private sector innovation is excellent, and people should be able to capitalize on it.
However, being myself I do think government has a perogative to persue innovation that may not be immediately useful for either private sector or short-term gains. Items that have a long-term social good (that companies may eventually capitalize on) but cant afford to go after themselves currently for a variety of reasons.
For this though, I fully support the new method by NASA where they allocate X dollars towards a "result" and let private companies (often more innovative and riskier) do whatever it takes as long as they hit the result while meeting all the requirements. To me that is the ideal role of government when they have to undertake innovation for social good - incentives for private companies.
financial return has to come from productivity gain ultimately. historically we have borrowed 1.5 dollars for each dollar of GDP growth. we're now up to 6 and most of that is consumption, no longer capital investment.
so all you young guys looking into finance are driving with your rear view window.
Is everyone forgetting DARPA? Dollar-for-dollar, these guys are the most efficient things we spend money on in our government. They're the only agency that thinks consistently about stuff on a 50-100 year time horizon, and the dollar impact is 2-for-1 in serving as our near-term military tech and our future civilian tech.
Does financial innovation help economic growth? (Originally Posted: 02/23/2010)
The Economist debate series is taking on financial innovation and economic growth. (http://www.economist.com/debate/overview/166&sa_campaign=debateseries/d…)
They are asking if financial innovation helps economic growth, or if the kind of innovation we've seen is really just greed and irresponsibility (the public certainly seems to think so). I think that's a pretty interesting question to ask, since the level of innovation (and complication) our financial system has seen has gotten to be pretty absurd sometimes. There is definitely the good type of innovation (the one that increases efficiency in getting capital from savers to entrepreneurs) and the bad type (the kind of "innovation" designed so that investors don't know what the hell they're investing in, for example).
So to what extent are we, the professionals of the finance industry, responsible for economic growth in this country? And to what extent are we responsible for the mess of the last couple of years?
Interesting. I haven't read it yet, but I'd readily side with those who believe "innovation" is much too generous of a word. Financial Innovation has been formed only to circumvent regulation and aid in the creation of opportunities for speculation. Sure- there are secondary channels where wealth from financial innovation has trickeled down to other industries that fostered economic growth- but I don't think that counts.
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