Financial Literacy
Submitted by lev_lafayette on Tue, 07/07/2009 - 02:06A core problem exists in the assumption that what is profitable for an individual entity is profitable for an economy as a whole. This is raised on a divisional/entity level in the Contemporary Accounting textbook: ".. the maximisation of a division's profit may not always ensure the maximisation of the profit of the entity" (p13).
Two articles by the LVRG come to mind on this matter, one is a long-term index of real-estate prices to GDP and the other is a recent empirical study on the correlation of speculative investment to financial collapse.
