Given the rapid reflation of the prices of speculative assets and the collapse of risk premiums, the ongoing money printing efforts in the developed world are having limited effect outside of the “finance economy”.  It is estimated that up to 40% of US corporate profits are generated by the finance sector – largely from speculative activities.  Corporate profits attributable to the finance sector were effectively stable until the 1970s when the growth in the US money supply turned sharply higher on a sustained basis.  Given the finance sector’s intimate relationship with the US Federal Government and the Federal Reserve banking system it is not surprising that the newly printed money has flowed into and through the finance sector acting as a wholesale subsidy that drove corporate profits, compensation and speculation.

Equicapita is a Calgary based income trust which manages an RRSP and TFSA eligible SME private equity fund for retail investors.