A New Paradigm for Finance: David Blood

Mind map notes on the TED Talk by David Blood "A New Paradigm for Finance."

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A New Paradigm for Finance: David Blood by Mind Map: A New Paradigm for Finance: David Blood

1. Education and Work Background

1.1. Studied to be a teacher, then a child psychologist.

1.2. Applied to the Peace Corps; got rejected

1.3. Rejected for doctorate in psychology

1.4. Applied to 70 banks; rejected by 69

1.4.1. Why he is now in finance industry

2. Al Gore

2.1. Blood's partner

2.2. Jokes about being a recovering politician

2.2.1. Blood never saw himself as a recovering investment banker; believes finance can be a force for good.

3. Current State of Industry

3.1. World's financial systems in turmoil

3.2. Problems with capitalism

3.2.1. Rising Inequality

3.2.2. Focus on the short-term

3.2.3. Misaligned incentives

3.2.4. No price on externalities

3.3. Many in finance and banking industry are close to losing license to operate

3.4. "If you don't change direction, you might end up where you are heading." - Chinese philosopher, Lao Tzu

3.4.1. If we do not solve these problems, we WILL get where we are heading.

3.4.1.1. Poor economic growth

3.4.1.2. May create financial havic

4. Sustainable Capitalism

4.1. What is Sustainable Capitalism?

4.1.1. Integrates environmental, social, and governance issues into decision making

4.1.2. Encourages long-term economic strategy

4.1.3. Puts a price on carbon

4.2. Impact Investing

4.2.1. What is Impact Investing?

4.2.1.1. Using capital market tools and business techniques to address societal and environmental challenges

4.2.2. Variety of possibilities

4.2.2.1. Investing in social entrepreneurs

4.2.2.2. Social impact bonds

4.2.2.3. Financing transition to low-carbon economy

4.2.2.4. Putting prices on environmental services

4.2.3. Variety of returns

4.2.3.1. No concessions - extraordinary returns

4.2.3.2. Trading return for impact

4.2.4. Investment Case

4.2.4.1. Estimates that impact investing will be 5-10% of institutional and high-network peoples' portfolios in the next 10 years

4.3. Why should we care?

4.3.1. We know that the market cannot solve societal and environment challenges on its own.

4.3.2. Philanthropy is not large enough to address challenges

4.3.2.1. Impact investment leverages and enhances philanthropy

5. Can finance and banking be a force for good?

5.1. What's in it for me?

5.1.1. It's a good business decision

5.1.2. Enhances license to operate

5.1.3. We have the tools to address the problems that the world faces - It is the right thing to do.

5.2. Robert Schiller's book: "Finance has the potential to provide hope for a more fair and just society."