Finance: From Engine of Growth to Master of Extraction

How Wall Street Hijacked the Meaning of Value

Once upon a time, finance was the quiet engine that powered the real economy—helping businesses grow, families buy homes, and communities prosper. But in recent decades, something has changed. As Mariana Mazzucato reveals in 'The Value of Everything,' finance has become less about making and more about taking.

Through deregulation and clever accounting, banks and investment firms have rebranded their profits as 'productive,' even when they come from speculation, asset trading, or fees. The result is a financial sector that towers over the rest of the economy, extracting value rather than creating it. Share buybacks, for example, have soared to record levels, enriching executives and shareholders while leaving little for workers or innovation.



This shift has profound consequences. Inequality widens, investment in the real economy stalls, and the risks of crisis multiply. The 2008 financial meltdown was not an accident, but the inevitable result of an economy where value extraction is rewarded more than value creation.

Mazzucato argues that it’s time to reclaim finance as a tool for the common good. That means regulating speculation, rewarding long-term investment, and ensuring that the rewards of growth are shared more fairly. Only then can finance return to its rightful place as an engine of prosperity, not a master of extraction.