As someone who’s followed the economic ebbs and flows of empires for years, I’ve often said that there’s tremendous risk to financializing everything; and not just a theoretical concern about capital markets and macroeconomic theory… My worry comes from a deep love of life and the simple pleasures that make it meaningful. I wear shoes because I enjoy walking, not because I want to flip them for a profit. I buy toys because they spark my kids’ imaginations, not because I hope to resell them to a collector. I wear a nice watch because I want something mechanical to remind me that men used to build things without digital input. When homes, clothes, watches, toys, trading cards, and everything else become speculative instruments, the joy of using them disappears. Let’s take a look at the first empire to truly monetize everything and learn why the path from empire to financial asset bubble is a slippery slope.
The Dutch model: trade, innovation. Then speculation…
In the 17th century, the Dutch Republic was the pre‑eminent commercial power in Europe. By around 1670, the Dutch merchant marine represented about half of Europe’s shipping capacity. Dutch shipbuilders, merchants, and craftsmen created a global network stretching from the Americas to Asia. Their republic’s financial system was sophisticated: the Amsterdam Exchange, Bank of Amsterdam, and pioneering joint‑stock companies like the Dutch East India Company allowed average citizens to invest in overseas ventures. At its height, this “Golden Age” funded art, science, and social tolerance at home as a product of their massive wealth.
But military conflicts and competition eroded the commercial edge. Wars with France and England ended the boom and forced a retrenchment. As these wars drained resources, the government cut military spending and paid down debt, and a wealthy rentier class emerged. Instead of reinvesting in industry, Dutch capital increasingly flowed into international loans, trading securities, and government bonds. By the end of the 18th century, the republic was deindustrialized and had become the major market for sovereign debt. In other words, the Dutch shifted from producing goods to buying financial products: an early case of financialization.
The cultural hallmark of that shift was tulipmania. Starting in late 1636, prices for rare tulip bulbs surged as speculators bought and sold “futures” contracts. Some bulbs experienced a 12‑fold price increase in just a few months, and receipts for single bulbs reportedly reached 5,000 Dutch Guilders, which was about the price of a house at the time. The bubble burst in February 1637, collapsing prices and exposing how far speculation had detached from the flowers’ intrinsic enjoyment. The crash didn’t destroy the Dutch economy, but it revealed how quickly a culture can be consumed by speculative fervor.
By the late 18th century, the Dutch were still wealthy on paper, but their wealth sat in foreign bonds and domestic debt rather than in productive industry. When revolutions and wars swept Europe, the Dutch state defaulted on its debts in 1815. This established a cycle of early innovation and productive investment, followed by overconfidence and speculative excess, culminating in decline and default. It’s a cautionary tale: an empire can become so enamored with finance that it neglects the industries and social cohesion that built its wealth in the first place.
If you’re interested in a deeper dive on the Dutch, this video inspired me to write the article:
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The United States and the temptation of finance
The parallels with the modern United States are striking. After World War II, the dollar became the world’s dominant reserve currency, granting Americans access to cheap imports and the ability to borrow at low interest rates. This status helped build America’s middle class, but it also encouraged consumption over production. A strong dollar makes imports cheap and exports expensive, hurting manufacturing‑heavy regions and causing job losses in labor-intensive sectors, which is suitable for people who become upwardly mobile but bad for the culture as a whole. Some economists argue that both the U.S. and the world would benefit from a less dominant dollar to rebalance trade. On the other hand, losing reserve status would raise borrowing costs and limit the government’s ability to fund social programs, which most Americans now rely on for large parts of their lives.
Financialization isn’t just about reserve currencies; it’s a structural change in the economy in which financial activities take on an outsized role compared with producing goods and services, engaging in simple trade among ordinary people, or even showing basic human decency in our neighborhoods. Researchers at the Washington Center for Equitable Growth define financialization as the growing importance of the financial sector and the increasing use of financial metrics, such as shareholder value, to govern firms and households.
This is heavily punctuated by Attorney General Pam Bondi, after being asked why nobody has been arrested from the Epstein client list, immediately talking about how the DOW is at an all-time high.
In practice, this means that more non‑financial companies derive profits from financial activities; for instance, General Electric derived 43% of its profits from finance in 2014. The ideology of “shareholder capitalism” popularized in the 1970s encouraged corporate managers to maximize short‑term stock prices. As a result, financial profits grew, while investment in long‑term mental or spiritual health, or even business innovation, stagnated.
This shift has real consequences for everyday people. Financialization contributes to income inequality by giving finance professionals outsized pay and capturing economic rents. It also reduces the share of national income going to labor. When companies prioritize stock buybacks and derivatives trading over building factories or paying workers, communities hollow out. Meanwhile, the proliferation of complex financial products encourages speculative behavior reminiscent of tulip mania. Instead of tulips, we now have sneaker resale markets, luxury watch “investments,” and trading cards treated as commodities, and the bastardization of Bitcoin from a P2P cash system into a treasury asset.
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Toys, shoes, watches, and trading cards: When everything becomes an asset
This commodification of fun is personally troubling. Toys, shoes, watches, and trading cards should be sources of joy, not just financial instruments. In the past few years, we’ve seen limited‑edition sneakers snapped up by bots and resold at 10× the retail price; watches become “investment pieces” held in vaults instead of worn; trading cards encased in plastic to preserve their “mint” value; and even LEGO sets treated as speculative assets. The appeal of these items, the way they feel on your feet, the tactile satisfaction of shuffling a deck, the joy of building a model, is lost when they’re treated like numbers in a spreadsheet, but EVERYTHING IS TREATED LIKE NUMBERS ON A SPREADSHEET!
Even our houses, the places designed for us to eat, sleep, play, and establish familial bonds, have been financialized to a degree that degrades the quality of life for ordinary people.
The Dutch example illustrates why this is dangerous. When tulip bulbs became speculative tokens, their beauty and horticultural value were forgotten. When the Dutch economy shifted from making ships and goods to trading bonds and tulips, it lost its foundation in productive work. Similarly, treating toys and hobbies as investment risks severing the connection between material culture and human happiness. Families may struggle to buy a cool pair of shoes for a child because speculators drive up prices. Collectors hoard limited‑edition watches, denying people the chance to actually use them to tell time. A simple card game becomes a high‑stakes game of speculation, where parents are slapping their children’s hands as they wish they could just play the damn game!
This mindset erodes community and stokes envy and frustration.
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Bitcoin: from digital cash to speculative asset
Bitcoin was originally developed to function as a peer‑to‑peer electronic cash system that would allow people to transact without intermediaries. In its early years, the typical Bitcoiner saw it as an experiment in digital money that might complement, and eventually replace, everyday transactions. However, as mainstream attention grew, a noticeable shift occurred: an increasing number of people started buying Bitcoin not to spend it but to speculate on its price. This speculative demand drove Bitcoin’s price up, creating more speculation on dodgy exchanges and sucking people into an addiction to simple price speculation. Such volatility undermines Bitcoin’s original purpose as a stable medium of exchange, unit of account and a store of value.
The Dutch history (and later British history, if you want to dig into it) helps us understand this dynamic. Just as the Dutch went from using the Guilder as a functional currency to speculating on tulips and foreign loans, many in the blockchain space have shifted their focus from building decentralized payment systems to trading tokens as if they were tech stocks. I still appreciate Bitcoin’s potential to empower individuals and reduce friction in global commerce, but I worry that the financialization of the space into meme‑coins, NFT speculation, “play‑to‑earn” games, etc, reflects the same human tendency to turn new technologies into speculative vehicles rather than tools for everyday life.
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What’s at stake when everything is an investment?
Over‑financialization threatens more than our hobbies; it endangers the fabric of society. When people treat housing, education, health care, and even relationships as investment opportunities, the common good is subordinated to financial returns. The concentration of wealth in financial assets amplifies inequality and gives a small financial elite outsized influence over politics and culture. Workers become “human capital” whose value is measured by return on investment. Creative pursuits are reduced to content monetization, and the homes become an onion of wrapped derivatives that drive up cost while crushing real value for real people.
A culture that prizes speculation over craftsmanship loses resilience, because it has too few builders and too many gamblers.
Looking at the Dutch case, we see that this dynamic is not new. The republic’s rise was driven by entrepreneurship, hard work, and a society that valued hard work, art, and scientific inquiry. Its decline was marked by wars, debt, speculation, and disinvestment in productive sectors. When the government defaulted in 1815, the once‑mighty Dutch empire had little industrial base left to fall back on. The U.S. is not destined to follow this path, but the similarities are sobering: our financial sector looms large, our manufacturing base has shrunk, and everyday goods are increasingly treated as assets. Without intentional efforts to invest in people, rebuild infrastructure, and encourage real innovation, we risk repeating the cycle.
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Reclaiming simple pleasures and preparing for what’s next
So what can we do? First, we should remember why we value things. Toys are meant for play, shoes for walking, watches for telling time, your house is supposed to facilitate safety and familial bonds, and trading cards are for playing games. Enjoying these items for their intrinsic qualities is an act of resistance against financialization. Second, we must support policies that encourage productive investment: funding for research, education, and manufacturing, rather than solely rewarding speculation. Reversing these trends requires a profound moment of reflection as a culture, in which we need to rethink our relationship with money and technology.
Bitcoin, for instance, holds promise as the most efficient digital cash, but it must be designed and used for transactions, business contracts, and savings rather than as speculative chips.
Finally, we should be honest about where we are on the Dutch cycle. The U.S. still has immense productive capacity, talent, and cultural capital. I am not a “Doomer,” but we also have a bloated financial sector and a culture eager to gamble on everything. I write this not to offer fear, but to call for balance. Economic growth is good; innovation is good; markets are useful. Yet, we must not lose sight of the purpose of wealth: to enable us to live well, to enjoy the fruits of our labor and to build communities where we can share simple pleasures. The Dutch empire’s story and the cautionary tale of tulipmania remind us that when speculation overwhelms production, decline follows. My hope is that we can heed that lesson, enjoy our toys and shoes without turning them into stocks, and channel our resources into building a future where finance supports life rather than supplanting it.
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Watch | Blockchain Futurist 2025 (Part 1): What’s real vs what’s hype?
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Watch | Blockchain Futurist 2025 (Part 2): From hype to real use cases
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Source: https://coingeek.com/stop-financializing-everything/
