Why Bankers Don’t Understand Business

Today, Gary Hoover published his favorite quotations on Hoover’s World. The one that stood out most to me was this one from Peter Drucker:

No financial man will ever understand business because financial people think a company makes money. A company makes shoes, and no financial man understands that. They think money is real. Shoes are real.

AB — 19 Nov. 2009




Heartlessness in Hard Times

Naked Capitalism ran an interesting item today about a family who was looking for help dealing with unreasonableness they encountered in dealing with Bank of America. Today’s post was actually Part 2 of an account of this family’s problems since the main wage-earner lost his job — you can read it all at “Debt Stress in Middle Class America, Revisited.”

What was striking was the level of heartlessness received in reader’s comments on the original post:

[S]ome responded with vitriol, their comments having no grounding in anything more than prejudice, on why this family was having trouble making ends meet. Quite a few of the comments also reflected a considerable lack of understanding as to how the bottom half, income-wise, lives (for instance, saying that the couple “should” have several hundred thousand in savings plus that much in their home equity). A different theme was the couple should be on food stamps and the adult children and their kids should be on [Medicaid].

It was interesting (but not surprising to me) to see the extent to which many people living in their personal bubble (see “Levels of Economic Bubbles”) show not only gross heartlessness toward others but a profound ignorance of economic realities even right here in the U.S.

AB — 1 Nov. 2009