This week, manufacturing and transportation executives met at a Reuters Summit in Chicago to discuss ongoing problems in the sector and the economy. They also reflected on the frighteningly lightening fast 1,000 point drop and rebound in the Dow that was likely caused by algorithm-driven trading.
Manufacturers argued that they must operate within a tight regulatory framework, for safety and other reasons, while the financial services industry seems to have free reign to unleash whatever economy-threatening instruments that bonus-driven bankers can dream up.
According to Reuters:
“Several executives said days of market turmoil also made them feel all the happier to work in an industry that relies on hard assets and well-trained workers, where value cannot evaporate quite so quickly.
“‘When I came out of business school 26 years ago, I made a very important career decision that I wanted to work for an industrial company and I haven’t regretted that one time in the last 26 years,’ said Jim Griffith, CEO of bearings maker Timken Co (TKR.N). ‘Not in 2008 when we were at record levels of demand or in 2009 when we were at the bottom of the economy.’
“In the week that followed the dramatic plunge in share prices, U.S. stocks have recovered most of their earlier losses. After the wild market swings of the past two years, executives said they have learned to take wild share fluctuations in stride.”
The manufacturers voiced a need for greater regulation in financial services, more on par with what they have to contend with. Yet, the reality is that trying to regulate financial innovation is a much more complicated undertaking. It’s also a sector where government regulators have the potential to do a lot more harm than good.
The second point addressed by the group has more merit. The US manufacturing sector does sometimes compete in the same math-oriented labor market as financial services. In it, smart students must weigh career choices like these two against one another. In this case, they choose between the allure of quick money and prestige in the banking sector versus lower-paid and more traditional work in engineering. You can see why it’s a tough sell.
The Christian Science Monitor has assembled a diverse group of the best economy-related bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. To add or view a comment on a guest blog, please go to the blogger's own site by clicking on the link above.