Wages for those government workers who still have jobs have been frozen for most of the decade. Yet Canadians believe they are in the midst of a period of economic prosperity, Stanford says. It turns out that Canadian wealth, and much of the prosperity of the West, is built on 'investment securities' such as stocks, derivatives, mutual funds, and commodities futures that have values that bear no relation to the real economy. Money raised by the stock markets isn't going into new factories, machinery, job hires, or research. As the paper economy boomed, the real economy went nowhere.
Stock markets have virtually nothing to do with real investment by real businesses.
Governments, he says, must shift the emphasis of government policy and private entrepreneurship away from the financial sphere and the paper economy, and focus it on real capital accumulation and real growth. Mark Bourrie is a correspondent for Inter Press Service, with whose permission the above article has been reprinted.