New research shows: Financial world dominated by a few deep pockets

Haven't we suspected this all the time?

When we wonder, why the world is, how it is... When politics support things nobody really wanted...

Could it be that a big part of the conspiracy theories are real, about the Bilderbergers, the Davos meetings and others, that they secretly pull the strings in the background? We can't be sure about this, but that the wealth of the world is allocated more inequitably than ever now is a fact. Scientists from the ETH Zurich in Switzerland found that ownership is becoming increasingly concentrated and increasingly transnational.

In an article in 'The Science News' Rachel Ehrenberg writes:

"Conventional wisdom says a few sticky, fat fingers control a disproportionate slice of the world economy’s pie. A new analysis suggests that the conventional wisdom is right on the money.

Diagramming the relationships between more than 43,000 corporations reveals a tightly connected core of top economic actors. In 2007, a mere 147 companies controlled nearly 40 percent of the monetary value of all transnational corporations, researchers report in a paper published online July 28 at arXiv.org.

“This is empirical evidence of what’s been understood anecdotally for years,” says information theorist Brandy Aven of the Tepper School of Business at Carnegie Mellon in Pittsburgh.

The analysis is a first effort to document the international web of relationships among companies and to examine who owns shares — and how many — in whom. Tapping into the financial information database Orbis, scientists from ETH Zurich in Switzerland examined transnational companies, which they defined as having at least 10 percent of their holdings in more than one country. Then the team looked at upstream and downstream connections, yielding a network of 600,508 economic actors connected through more than a million ownership ties.

This network takes on a bowtie shape, with a large number of diffuse actors in the wings and a few major players tangled up in the tie’s knot. So while it’s true that ownership of publicly held corporations is broadly distributed, says complex systems scientist James Glattfelder, a coauthor of the new work, “take a step back and it’s all flowing into the same few hands.”

A central core of extremely powerful actors (red dots) dominates international corporate finance, a new mathematical analysis finds.

While any man on the street may have predicted this outcome, the economic literature portrays markets as so dynamic that they lack hot spots of control, Glattfelder says."

It's the economy, stupid!

Please read the full article http://www.sciencenews.org/view/generic/id/333389/title/Financial_world_dominated_by_a_few_deep_pockets