Editors, The Economist, London, U K
Re: Jobs – May 3 edition page 64
In this article we see again the uncritical, undifferentiated view of “jobs”, “financial industr[ies]”, and “liquidity” as if all were unreservedly Good Things. In fact, however, some elements of some of these are unreservedly Bad Things and need to be given proper names, such as No Value Added (NVA) and Value Subtracted (VS).
Example: By no stretch of any imagination does a few milliseconds dwell time of some lump of capital in any economy add any value to anyone anywhere except to the High Frequency Trader (HFT) himself. Such “jobs” are somewhere between NVA and VS, and the the economy would be better off without them, their occupants set to work in some VA occupation – market gardening, perhaps, if they are VA-trainable.
Perhaps the Chinese are still deliberately delaying capital movements by some small amount. This, without elaborate and impractical worldwide agreements and the collectibility upon which you comment, is a simple and effective means of denying the HFT the opportunity upon which his equality-destroying unearned millions depend, i.e. quick turnover. If such a policy selectively harms some elements of some industries in some countries and eliminates some jobs, that would be to the long-term good of those countries, because it would prevent NVA and VS capital from churning their markets and would eliminate the unproductive so-called jobs that go with it. A responsible investor intending to apply his capital productively for years (by building a factory, say) could shrug off a small delay at the front end; an HFT could not, would have to go elsewhere, and God speed.
Frank Gue, B.Sc., MBA, P.Eng.,
2252 Joyce St.,
Burlington, ON Canada L7R 2B5
905 634 9538