The House Always Wins: How Finance Ate the World Before It Ate Itself

Let’s go back to the 1980s—but not to Reagan’s speeches or Thatcher’s handbag.

Let’s go to Wall Street. The trading floor. The coke-fueled war zone. The birthplace of the modern financialized economy.

Because while governments were deregulating, privatizing, and blaming the poor, finance was evolving into something... unrecognizable.

Not just a part of the economy.
The economy.

What Is Financialization?

Put simply:

When making money by moving money becomes more profitable than making things.

Factories? Slow.
Wages? Costly.
Services? Fine, whatever.

But derivatives? Mortgage-backed securities? Leveraged buyouts?

Now we’re talking growth. On paper, at least.

A Quick Timeline of Madness

  • 1986 – “Big Bang” in London: Financial deregulation lets banks merge, speculate, and invent wild new assets.

  • 1999 – Glass-Steagall repealed: U.S. tears down wall between commercial and investment banking. Fox now officially inside the henhouse.

  • 2000s – The Rise of “Structured Products”: Fancy speak for repackaging debt into something marketable. Think of it as turning rotten fish into sushi platters and selling them to pension funds.

And driving it all?

  • Ultra-low interest rates

  • Huge capital flows

  • Algorithms that outpace regulators

  • And the sacred cow: Shareholder Value

The result? Every business, school, and government was suddenly being judged not on its service to society—but on quarterly returns.

The House of Cards

Finance didn’t just grow. It became predatory.

  • Hedge funds bought up water rights and housing.

  • Private equity firms hollowed out companies to flip them.

  • Subprime lenders handed mortgages to people with no income, no assets, and no hope.

  • Ratings agencies—paid by the very banks they rated—stamped toxic junk as AAA gold.

It was a pyramid scheme in Armani suits.

But here’s the trick:
Everyone benefited... until the day they didn’t.

2008: The Implosion

  • Lehman Brothers collapses.

  • Bear Stearns folds.

  • AIG needs a multi-billion dollar transfusion.

  • Global credit freezes.

  • Entire economies lurch toward the edge.

And what happens?

  • The banks get bailed out.

  • The people get evicted.

  • The crisis becomes austerity in Europe, Tea Party rage in the U.S., and IMF discipline everywhere else.

Finance ate the world, choked, and was handed a napkin.

But Here's the Twist

2008 wasn’t the death of neoliberalism.
It was its mutant rebirth.

Instead of reforming the system, governments doubled down:

  • Central banks pumped in liquidity (read: free money for markets)

  • Public debt soared—but instead of taxing the rich, we slashed services

  • Tech platforms stepped in to “innovate” what the state abandoned

  • Asset prices recovered—people didn’t

The casino got rebuilt, with better security and worse odds.

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