Securities: the new world wealth machine.

Securitization—the issuance of high-quality bonds and stocks—has become the most powerful engine of wealth creation in the world economy. Securitization requires that a state find ways to increase the market value of its capital stock. In the past, manufacturing, exporting, and direct investment p...

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Publicado en:Foreign Policy no. 104; pp. 118 - 134
Autor principal: Edmunds, John C.
Formato: Artículo
Publicado: Foreign Policy Fall 1996
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Acceso en línea:Ver este registro en EBSCOhost
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        Securities
        Capital movements
        Economic development
        Wealth
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          Securities
          Capital movements
          Economic development
          Wealth
      ab: Securitization—the issuance of high-quality bonds and stocks—has become the most powerful engine of wealth creation in the world economy. Securitization requires that a state find ways to increase the market value of its capital stock. In the past, manufacturing, exporting, and direct investment produced prosperity by generating income. Nowadays, wealth is created when business managers give high priority to rewarding shareholders and bondholders. The primacy of shareholder return has created a situation wherein the managers of investment portfolios have acquired enormous influence over the managers of issuing companies, since they, in effect, hold the proxies of the owners. Consequently, many American companies that perform well in the financial markets do so at a price—restructuring and downsizing to increase shareholder wealth leave people unemployed. Despite the disadvantages, however, an increasing number of states have the opportunity to benefit from the global increase in wealth that has accompanied securitization.
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