Former U.S. Vice President Al Gore said capitalism is coming under increased scrutiny and needs to change as short-term thinking has driven a wedge between investing and the creation of value for corporations.
“In spite of its benefits, it’s now associated in the minds of people all over the world with a growing set of problems and challenges that require us to address needed reforms in capitalism,” Gore, who’s also a Nobel Prize laureate, said today in a speech in Stockholm.
Gore, who has transformed himself from a politician to a successful businessman with a net worth that could exceed $200 million, has spent the past years also advocating “sustainable capitalism” as parts of the global economy still struggle to emerge from the worst economic slump since the Great Depression.
“There is a continuing focus on short-term decision making in markets and that is distorting the allocation of resources,” he said. “It’s hurting the quality of decisions that are made by companies.”
Stock markets have tumbled since the end of May, wiping more than $500 billion off the value of U.S. stocks, amid concern the Federal Reserve will begin reducing stimulus for the economy. Central banks around the world, from the U.S. to Japan, have been forced to deploy unconventional policies such as asset purchases to boost demand as interest rates hit record lows. Unemployment has surged to a record in the 17-nation euro-area where the economy is estimated to shrink for a second year.
Gore this year sold his Current TV network to Al Jazeera, the cable channel funded in part by oil-rich Qatar. The sale was announced in January with a price tag of about $500 million.
Gore served as vice president during President Bill Clinton’s administration and shared the 2007 Nobel Peace Prize for his fight against global warming.
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