Other than financialization’s ability to generate profits for its proponents and participants, it has no other positive impact on anyone. Some of the impacts it has on society, social structure, inequality are mentioned below.
1. With financialization, which is a low employment sector of a sector with low density of employees, the number of jobless would rise as a high employment sector like manufacturing declines and with it the thousands of employees who find no jobs.
2. Financialization creates income inequality when a few elites with some fancy degrees earn more sitting on Wall Street by disallowing the economy to grow in real sense. They make wages of workers stagnant, and thus keeps escalating the income divide between the globalists or capitalists and the weaker section of society. They are vicariously liable for this creation of disparity and must be penalised.
3. Financialization transfers income from the real sector of manufacturing and production to the financial sector which is without any intelligent product type (Palley, 2007). This in itself is liable for critique and strict auditing.
4. It has the capability to make the company go into prolonged recession if the limits of financialization are not set and the share of real sector keeps declining. This is immensely important since it can affect the global markets with incurable wounds.
5. It transforms the functioning of the economy in real sense when it considers itself insurmountable and too large to fail size. It then becomes indifferent to the concerns of the nation’s weaker section, which creates social unrest, social distress and may lead to abnormal increase in criminal incidents.
These are some of the few impacts that it has on the market and nations and makes everyone else vulnerable to even small deviation and variation in policy and market movements. To consider an example, the Wells Fargo scandal where artificial value build up was easily executed with superficial sales figures and increase in paper value of the company (Egan, 2016). This made the insurance sector naked for its continuous use of financialization as a means of survival when they are incapable of providing anything of substantial value. Such instance is easier to implement in a company were the product itself is something of a paper application and nothing more physical. Inversely, such an instance may be less probable in a manufacturing company where real production value is noted with care and there remains something of physical presence that is built and is to be accounted for.