Finance and Good Society

        Finance is a technology of great power. It plays an important role in our society which range from the benefit of ordinary people to the benefit of the whole world. This thesis mainly talks about how the finance works to build up our good society, and the difficulties we meet on the road leading to the good society which need us to overcome. Thus we ought to pay more attention to research more into the human psychology and build a self-regulatory finance system.

       After suffering from the horrible Finance Crisis, more ordinary people begin to know the word “finance”. Though the Finance Crisis caused a plenty of tragedies in financial industry, and brought people into a great panic. However, on the other hand, it indicates finance is associated with our society tightly. Robert J. Shiller, an American economist, academic, and best-selling author, says, “Even poets require financing to practice their art. They need an income to feed themselves, they need publishers, they need printers or their equivalent, and they need arrangers of public readings, they need the construction of suitable halls for public readings, and so on. There is a hidden financial architecture behind all of this.” From above we can easily see finance is related to all aspects of our daily life namely our society. Finance also can satisfy the resource demand of our society, what’s more finance provide the incentive structure to make our society work better. Apparently, the development of financial industry is essential. However as the finance crisis influenced our life and the globe economy painfully, there must some problems in the finance system obviously. Instead of condemning the defect of finance system, what we should do is to find out those problems and try our best to change the current situation, expanding and realigning finance system to make us closer to the goal of good society.

       Finance is the study of how investors allocate their assets over time under conditions of certainty and uncertainty. In the finance industry, Individuals take part in it for investing, insurance and saving for retirement. For corporate, finance is the task of providing the funds for a corporation's activities. Fund is the base of a corporate, without it a corporation hardly does anything. Even if there are a lot of advantages of the corporation, without fund it is nothing. Governmental effects on efficient allocation of resources, distribution of income, and macroeconomic stabilization which is called public finance. All above are through using financial instruments appropriately to reach the goals setting by themselves.
       In a certain degree, finance is a form of cooperation. Recent years, many things are impossible for one person to accomplish. The ability of one person is far away from finishing those tasks. In order to finish those tasks, we need groups of people and resources. What’s more many projects would last a long time which need some kind of continuity of support from people and resources. It’s finance that can satisfy all those demands. Through finance, we could make amount of peoples with the same goal into cooperation. All they will try their best to fight for the reaching of the goal, since they have the same profit. Power of cooperation is strong enough beyond people’s imagination. Use the strength we could do a lot of things which with great advantage to our society and we won’t think about it in the past. Furthermore with cooperation we will be close to a perfect finance system .In which we would have all our risks pooled completely, that is no body suffers alone. Whatever happens to us, it could spread out over the whole world, everybody suffer one part of our trouble and it will become unobservable which is so small that it’s meaningless. It’s a good way to make our society better.
       Besides cooperation, finance is also a great game between people. As we all know, human psychology drives finance market a great deal. It’s necessary for us to know more about human nature. Finance is created by humankind. All the things relating to finance is related to human’s behave. When people hold an optimistic attitude towards the economy and are full of intense desire for profit, the finance will be good in people’s eyes. And the economy will increase quickly in a short period. However if people too pessimistic about the economy and no longer believe others then the crisis is coming soon.Human’s behave influence the ecomomy ,the situation of ecomomy influence human back.In this circle human play an important and irreplaceable role.Where the economy will go in the future is depend on human’s behave.And the prosperous economy lead to the good society.
On the other hand,part of finance is actually philanthropy.For some successful man in fianance industry,it’s impossible for them to run out of they money.When they face the huge property they hold,they will natually think about giving those money to public unless he is miser, however a miser become a successful man is unbelievable.So the most successful people in finance surely will end up giving the money away.It is a support to our society .It will make ordinary people’s life more beauty to a certain extent.
Finance can provides an incentive structure to make people devote themselves to the common goals completely.For example , there is a project with workers、investors、regulators and even a lot of ordinary people involved in it.Everyone wants to get profit from it,under the incentive they surely will try their best to do something to make the project produce more interest for them.At the same time the project will go into a perfect state naturally.No one is willing to do something for nothing,but everyone is eager to do something which can give us the thing we want.So ,it’s important to set up incentive structure in our society which finance can .
Finance is the result of free market,however,everything must has a limit for it.If there is no regulation and all the behaviours in finance are free enough which means one can do everything no matter rational or irrational,thus we are likely to follow the same old disastrous road in the history of Well Street.Retrospecting the history of Well Street,we can see ,after every finance crisis,there was some new regulations being set up.All the time ,people are finding way to run the finance system better.Human all focus on the goal of building a good society. Now in many countries ,government plays an important role in finance,which oversight of finance market.Whereas,in my opinion,self-regulation is more important than government regulation.In terms of government regulation,it’s a good way to make finance do not exceed the rule,but it’s hard to follow the desire of finance.With self-regulation we could reach the state“following the desire of finance and not esceed the rule”.
       Finance is a great tool with which we reach the goals of our society and those goals comes from us, including the interests in careers, ambitions for our businesses, happy life in families and good wishes for future society. There is no wonder that great finance make the good society. We should unswervingly continue to fight for the development of finance, research further into human psychology in order to judge rationally in finance market, and actively participate in the building of self-regulation in finance system.

Reference
[1] Robert J. Shiller. Finance and the Good Society [M]. New Jersey: Princeton University Press, 2012