David Korten - Phantom Wealth and False Expectations

http://www.yesmagazine.org/blogs/david-korten/phantom-wealth-and-false-expectations

It is a curious thing. Unless we stuff it in a mattress, we expect whatever money we don’t immediately spend to grow in perpetuity without effort. We do not expect the same of real wealth. Buildings must be maintained. Machinery must be replaced. Knowledge must be updated. The trust and caring of a community must be continuously renewed. Skills must be practiced. Even wild spaces must be protected from predators, particularly human ones. All of these require a real investment of our time and life energy.

Only phantom financial assets, the product of financial bubbles and fancy accounting tricks unrelated to the production of anything of real use, can grow effortlessly and perpetually—producing phantom expectations that, in the aggregate, can never be fulfilled.

Financial planner Thornton Parker has pointed out phantom wealth expectations are likely to be an issue for baby boomers who built up financial assets during the stock market boom in anticipation of a comfortable retirement. Just as their collective decision to put money into the stock market during their working years helped inflate share prices, so their collective decision to take it out during their retirement deflates those prices, leaving them in potentially desperate straits.

The problem is not confined to retirement accounts. It applies as well to the endowments of foundations, universities and other nonprofits. It applies to the public trust funds of libraries and municipalities, college savings funds, the reserve accounts of insurance companies, personal trust funds and much else.

More at the link --

This is the perfect peek behind the curtain of deceit and theft that is our global econony and our MBA programs.

We were getting to this on another Topic thread which disappeared. One of the best discussions I have ever had and I was going to share this link after I found this here. I'd mentioned Korten. It seemed harmless, well-intentioned and full of loving thoughts. Maybe there was a RCMA complaint on it. *sigh*

I have really come to appreciate reading these online stories being shared with us from YES magazine. There is one about how they eliminated hunger in a city in Brazil. Great ideas coming out for all of us to think about. We've got to move forward.