Disintermediation

Stock brokers working at the  New York Stock Exchange  in 1963. Thomas J. O'Halloran, photographer [Public domain]

Stock brokers working at the New York Stock Exchange in 1963. Thomas J. O'Halloran, photographer [Public domain]

Getting rid of the middle-man. It sounds great.

Except it doesn’t happen that way. What actually happens is that dozens, hundreds or even thousands of middle-people are replaced by a single ‘middle-platform’.

In other words, with what is hoped will become a monopoly. The only place to buy.

And if you achieve monopoly or near-monopoly, you will also eventually achieve monopsony or near-monopsony, the only place to sell to.

That’s every investor’s dream. I’m not sure it should be the consumer’s.

The most benevolent dictator is still a dictator.