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Human beings, servants of the financial system
1 - The uncontrolled expansion of the financial system
2 - The power and size of the financial sector
3 - Financial sector liabilities and their evolution
4 - Financial liabilities and minimum wages
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1 – The uncontrolled expansion of the financial system
Since the Middle Ages, a financial system has built that is more and more
invasive of peoples' lives. As early as the sixteenth century, bankers financed
monarchies involved in wars and without a fiscal system worthy of the
designation; how they financed Europe's far-flung trade and global domination.
The introduction of money in paper and paper-money, and the development of
banking institutions, generalized and streamlined exchanges; with the scope of
the consolidation of capitalism, until the time came for the dematerialization of
money, in the form of electronic circuits. The physical absence of money will
make Humanity an object totally dependent on the financial system and
completely separate from the real life of human beings.
The liabilities of banks and finance companies correspond to the liabilities they
have towards third parties. Among these are the holders, persons, companies of
deposits, debt securities and loans; shares and shares in investment funds rights,
and insurance technical reserves; pension funds and standardized guarantee
reserves; financial derivatives and other third-party credits; loan products issued
by the financial institutions themselves; and still, outstanding tax or contribution
obligations. Bank liabilities correspond to values entrusted by individuals,
families, companies, speculators, States, etc; and, they are renewed at any time,
even if these changes do not produce significant effects on the overall value of
the liability. In the latter, are considered unconsolidated data, that is, the debit
and credit items between two entities, without compensating each other, for the
calculation of a net amount.
The application of these funds, made available to banks and financial
companies, is returned to companies and families in the form of loans granted,
as well as to public entities, mainly the State. The granting of these loans by
banks, is accompanied by mortgages on real estate (housing and commercial or
manufacturing facilities). They aim to provide lenders a precaution against
borrowers' difficulties in returning the amounts borrowed and interest due or
not yet due.
And, in turn, the State, due to its political and coercive power over the
population in general, constitutes a secure debtor, albeit with its own
prerogatives that make it have a unique negotiating power with national
banques; but, of course, a lot lower against the big global banks; and these, in
turn, know how to co-opt high-quality mandarins or experts in influence-
trafficking into their cadres, as well as exerting all the pressure on the
governance of small and medium-sized countries, especially when poor,
unstructured and undermined by corruption.
In global debt, the financial sector represents 18.8%. Its creditors are particularly
the families and non-financial companies that make their savings available to
the financial system. This system wisely takes advantage of the atomization of
its depositors, paying them interests that proves to be a small cost when
compared to theoretically infinite reproduction in which is inserted the financial
system. It takes advantage of cascades of operations within the Ponzi pyramids,
with the complacent support of central banks for stock exchange speculation,
through a game between the placement of public debt securities and their
immediate inclusion in the insane global money creation, duly sponsored by
states and their governments. Of course, within these, elements from the
financial system or colluding with its institutions swarm.
Taking into account the enormous mobility of financial markets and stock
exchanges; and, the speed at which the transactions process, a profit margin,
even if very short, led to the emergence of so-called derivative products whose
nebulous valuation, two years ago, was priced at $558 trillion to $1 quadrillion,
in the European nomenclature. Its existence is virtual, in the form of simple
records contained in the servers of large financial institutions. About this topic,
see yourself here.[1]
2 - The power and size of the financial sector
Since 1995, Eurostat has released elements of financial sector liabilities,
measured as a percentage of GDP, for countries that are currently part of the
EU. The variations observed for the period 1995/2020 show a general trend
towards an increase in the parameter used.
Detectable irregularities, in general, are related to periods of financial turmoil
such as 2000/2002. The dot-com crisis, to which were added the sequels of
September 11th in New York and the second western invasion of Iraq in 2003,
although there were no major shocks in the relationship between financial
liabilities and the evolution of the economy.
The bank failures following the American subprime, were declared, by the end
of 2007; and, came to affect the European financial system to promote the
Troika interventions (or similar formulas) in countries like Ireland and others, on
the southern edge of the EU. In this context, these interventions were harsher
and more imposing towards Greece and Portugal; less invasive in the cases of
Spain and Italy, countries with greater demographic, economic and political
dimensions within the EU; and conducted smoothly in rich Ireland.
From 2008 onwards, a twelve-year period begins in which financial liabilities
measured as a percentage of GDP show rising and falling years, with a much
higher frequency than in previous years. In summary, there are 20 cases of
breakage in 1996/99; 43 in 2000/2007; and 155 from 2008 to 2020. This
represents an irregularity; and, which has been increasing. The system is fragile,
unstable, unpredictable and that is why its consequences have to be harmful.
The increase in the weight of the financial system's responsibilities — that is, the
volume of capital deposited by families and companies — compared to GDP is
an element of fragility of the financial system; increasingly dependent on the
possession of other people's funds. However, central banks have the facility to
generate funds from scratch, as happens in the well-known quantitative easing,
this creation by Mário Draghi to cushion the voluptuousness of financial
speculators to infinity. And, knowing the distances that the financial system and
the political classes maintain in relation to the peoples, for the latter there are
bad consequences and lack of proper support for a good life. The next
dissemination of digital currency by central banks, with the disappearance of
physical money, will introduce a new element of population control; whose
funds may, at any time, be blocked or banned, within a political, social and
economic structure of true enslavement. This, however, is for a next text.
Throughout the period, there is an absolute highlight in the weight of bank
liabilities in relation to Luxembourg's GDP; and, this emphasis accentuates over
time – 6889% in 1995, 10015% in 2000, 14689% in 2007 and 23878% in 2020.
This is a typical case of the speculation effect, introduced by Keynes, as a
“development” of classical effects such as hoarding. Luxembourg, as the
financial stronghold that it is, encompasses a volume of capital without any
relation to its normal economy – one that contemplates the satisfaction of
people's needs. The indicator closest to that presented by Luxembourg in 1995
belongs to the Netherlands (630.2%) and, which reaches 1463% in 2020; in this
last year, the countries that appear right after Luxembourg are Cyprus (2535%)
and Malta (2468%), relegating the Netherlands to the fourth position.
Conversely, the countries where the ratio between liabilities and GDP is the
lowest—lower than the GDP value—are, in 1995—Croatia, Estonia, Latvia,
Lithuania, Poland, Slovenia, countries that, at the time, had a model own
economic. The countries that maintained this situation until later were Romania
(until 2008), Lithuania (until 2005), as well as Bulgaria and Poland until 2003,
approximate moments of the respective dates of inclusion in the EU.
More broadly, remember what we wrote about financial wealth and its share in
the richest countries:
In 2000 and 2008, the highest indicators of financial wealth were, in the USA
(80.1 and 85.2% of the respective total) and Switzerland (76.8% and 72.2%). In
2019, the US maintains the world's highest coefficient of financial wealth (84.4%
of the total), followed by Denmark (82.6%) and the Netherlands (79.9%).
The financial markets are credits cascades, in which only in the original holder is
a reality; henceforth, it is a theoretically endless chain; and where among the
majority of stakeholders, no one knows who the initial debtor is. Faith
dominates; it is not a question of faith in saints and miracles, but the faith that
the aforementioned cascades are perpetual… without ruptures or panic attacks
inducing enormous losses.
3 - Financial sector liabilities and their evolution
The average annual variation of financial corporations' liabilities, as a
percentage of GDP, can be broken down into the three periods considered
above – 1995/1999, 2000/2007 and 2008/2020. The first ends, sensibly, with the
dot-com crisis in the USA; the second encompasses the shake resulting from the
episode of the Twin Towers and ends with the onset of public debt crises and
bank restructuring; and the third includes the long period of relative economic
stagnation, with the emergence of huge public debts and the insane creation of
virtual money to maintain the so-called financial markets, in a mode of infinite
growth, in a vacuum.
Average annual change in financial sector liabilities (%)
It is evident in the graph, the trend towards a reduction in the global averages
of changes in the liabilities of the financial sector, leading to greater
homogeneity – 31.7% in 1995/99, 26.2% in 2000/07 and 10.9% in the most
recent period, 2008/ 20.
 In each of the periods considered, the countries with the highest and
lowest indicators are, respectively;
 1995/99 – Estonia (46.9%), Malta (43.9%) and Cyprus (43.5%); Romania
(10.7%) and Bulgaria (13.8%).
 In the designated period, none of those countries was a member of the
EU. Among the then members, the evolution of liabilities was relatively
homogeneous, amounting to between 30/37% of GDP.
 2000/07 - Malta (87.9%) and Cyprus (56.5%); Slovakia (12.2%) and Czech
Republic (14.3%).
 In the transition to the EU scope (2003/04) bank liabilities in Cyprus
increased by 3.6 times. As for Malta, there was an increase of 4.3 times,
over a longer period (2003/07).
 2008/20 – Finland (15.3%, Luxembourg (15.2%) and Czech Republic
(14.4%); Austria (7%), Malta and Portugal (7.8%) and Belgium (7.9%).
In addition to the exceptional case of Luxembourg, where bank liabilities
correspond to thousands of times the value of GDP, as
mentioned above, there are other situations in which,
comparing the indices, the indebtedness of the financial
system is growing much more than the normal GDP growth.
Thus, countries can be classified according to the growth of
financial liabilities, in 2020, relative to GDP, based on the
indicators for 1995:
Growth [0 to 2 times] – Germany, Austria, Belgium, Bulgaria, Ireland (2001/2020),
Portugal, Romania, Slovakia, Czech Republic;
Growth [2 to 3 times] – Denmark, Spain, France, Greece, Hungary, Italy,
Netherlands, Slovenia, Sweden;
Growth [3-5 times] – Croatia, Estonia, Finland, Latvia, Lithuania, Luxembourg,
Poland;
Growth [>9 times] - Cyprus and Malta.
4 - Financial liabilities and minimum wages
A comparison between the abovementioned multiplication of financial system
liabilities (see point 3) and the average annual increases, for the periods
1999/2007 and 2007/2021, of the average minimum wages for several EU
countries is interesting. That is, the comparison between the evolution of the
capital entrusted to banks and the variation in the income of real people,
essential for satisfying their basic needs.
monthly minimum wage
Annual change
(%)
1999 2007 2021 2007/99 2021/08
Belgium 1,095.89 1,283.00 1,625.72 2.1 1.9
Bulgaria 34.26 92.03 332.34 21.1 18.7
Czech 98.85 278.57 596.36 22.7 8.1
Allemagne - - 1,585.00 - 1.6
estonie 79.89 230.08 584.00 23.5 11.0
irish - 1461.85
1
723.80
- 1.3
Greece 512.13 767.55 758.33 6.2 -0.1
espagne 485.71 665.70
1
108.33
4.6 4.7
France 1,049.49 1,280.07 1,554.58 2.7 1.5
Croatian - 379.60 567.32 - 3.5
lettonie 80.49 172.34 500.00 14.3 13.6
Lithuania 104.05 202.73 642.00 11.9 15.5
Luxembourg
1
162.08
1,570.28
2
201.93
4.4 2.9
Hongrie 90.13 266.10 476.00 24.4 5,6
Malt 482.98 601.90 784.68 3.1 2.2
Pays-Bas 1,078.40 1,317.00 1,701.00 2.8 2.1
Pologne 160.18 248.43 619.46 6.9 10.7
Portugal 356.72 470.17 775.83 4.0 4.6
Roumania 27.46 124.44 466.72 44.1 19.6
slovenie 347.72 521.80 1,024.24 6.3 6.9
Slovakia 79.42 225.96 623.00 23.1 12.6
Source: Eurostat
The growth rates of monthly minimum wages and the large differences between
the effective values of countries with an older EU integration and those that
joined the EU, following the dismemberment of Comecon, are highlighted; these
dissimilarities are more evident in the period 1999/2007 than in the following
period, in a trend towards smaller dissimilarities.
In short, the liabilities that accumulate in the balance sheets of the components
of the financial system grow, clearly more than the purchasing power of the
European peoples; richer countries as well as poorer ones.
This and other texts in:
http://grazia-tanta.blogspot.com/
http://www.slideshare.net/durgarrai/documents
https://pt.scribd.com/uploads
Grazia.tanta@gmail.com 12/13/2021
1
[1]
The volatile realm of financial wealth
http://grazia-tanta.blogspot.com/2020/08/o-volatil-dominio-da-riqueza-
financeira.html
https://grazia-tanta.blogspot.com/2020/08/the-volatile-domain-of-financial-
wealth.html (english)
The evolution of wealth in Europe (2000/19)
https://grazia-tanta.blogspot.com/2020/08/a-evolucao-da-riqueza-na-europa-
200019.html
https://grazia-tanta.blogspot.com/2020/08/the-evolution-of-wealth-in-europe-
200019_6.html?m=1 (english)

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Human beings, servants of the financial system

  • 1. Human beings, servants of the financial system 1 - The uncontrolled expansion of the financial system 2 - The power and size of the financial sector 3 - Financial sector liabilities and their evolution 4 - Financial liabilities and minimum wages wwwwwwwwwwww vvvvvwwwwwwwwww 1 – The uncontrolled expansion of the financial system Since the Middle Ages, a financial system has built that is more and more invasive of peoples' lives. As early as the sixteenth century, bankers financed monarchies involved in wars and without a fiscal system worthy of the designation; how they financed Europe's far-flung trade and global domination. The introduction of money in paper and paper-money, and the development of banking institutions, generalized and streamlined exchanges; with the scope of the consolidation of capitalism, until the time came for the dematerialization of money, in the form of electronic circuits. The physical absence of money will make Humanity an object totally dependent on the financial system and completely separate from the real life of human beings. The liabilities of banks and finance companies correspond to the liabilities they have towards third parties. Among these are the holders, persons, companies of deposits, debt securities and loans; shares and shares in investment funds rights, and insurance technical reserves; pension funds and standardized guarantee reserves; financial derivatives and other third-party credits; loan products issued by the financial institutions themselves; and still, outstanding tax or contribution obligations. Bank liabilities correspond to values entrusted by individuals, families, companies, speculators, States, etc; and, they are renewed at any time, even if these changes do not produce significant effects on the overall value of the liability. In the latter, are considered unconsolidated data, that is, the debit
  • 2. and credit items between two entities, without compensating each other, for the calculation of a net amount. The application of these funds, made available to banks and financial companies, is returned to companies and families in the form of loans granted, as well as to public entities, mainly the State. The granting of these loans by banks, is accompanied by mortgages on real estate (housing and commercial or manufacturing facilities). They aim to provide lenders a precaution against borrowers' difficulties in returning the amounts borrowed and interest due or not yet due. And, in turn, the State, due to its political and coercive power over the population in general, constitutes a secure debtor, albeit with its own prerogatives that make it have a unique negotiating power with national banques; but, of course, a lot lower against the big global banks; and these, in turn, know how to co-opt high-quality mandarins or experts in influence- trafficking into their cadres, as well as exerting all the pressure on the governance of small and medium-sized countries, especially when poor, unstructured and undermined by corruption. In global debt, the financial sector represents 18.8%. Its creditors are particularly the families and non-financial companies that make their savings available to the financial system. This system wisely takes advantage of the atomization of its depositors, paying them interests that proves to be a small cost when compared to theoretically infinite reproduction in which is inserted the financial system. It takes advantage of cascades of operations within the Ponzi pyramids, with the complacent support of central banks for stock exchange speculation, through a game between the placement of public debt securities and their immediate inclusion in the insane global money creation, duly sponsored by states and their governments. Of course, within these, elements from the financial system or colluding with its institutions swarm. Taking into account the enormous mobility of financial markets and stock exchanges; and, the speed at which the transactions process, a profit margin, even if very short, led to the emergence of so-called derivative products whose nebulous valuation, two years ago, was priced at $558 trillion to $1 quadrillion, in the European nomenclature. Its existence is virtual, in the form of simple records contained in the servers of large financial institutions. About this topic, see yourself here.[1] 2 - The power and size of the financial sector Since 1995, Eurostat has released elements of financial sector liabilities, measured as a percentage of GDP, for countries that are currently part of the EU. The variations observed for the period 1995/2020 show a general trend towards an increase in the parameter used.
  • 3. Detectable irregularities, in general, are related to periods of financial turmoil such as 2000/2002. The dot-com crisis, to which were added the sequels of September 11th in New York and the second western invasion of Iraq in 2003, although there were no major shocks in the relationship between financial liabilities and the evolution of the economy. The bank failures following the American subprime, were declared, by the end of 2007; and, came to affect the European financial system to promote the Troika interventions (or similar formulas) in countries like Ireland and others, on the southern edge of the EU. In this context, these interventions were harsher and more imposing towards Greece and Portugal; less invasive in the cases of Spain and Italy, countries with greater demographic, economic and political dimensions within the EU; and conducted smoothly in rich Ireland. From 2008 onwards, a twelve-year period begins in which financial liabilities measured as a percentage of GDP show rising and falling years, with a much higher frequency than in previous years. In summary, there are 20 cases of breakage in 1996/99; 43 in 2000/2007; and 155 from 2008 to 2020. This represents an irregularity; and, which has been increasing. The system is fragile, unstable, unpredictable and that is why its consequences have to be harmful. The increase in the weight of the financial system's responsibilities — that is, the volume of capital deposited by families and companies — compared to GDP is an element of fragility of the financial system; increasingly dependent on the possession of other people's funds. However, central banks have the facility to generate funds from scratch, as happens in the well-known quantitative easing, this creation by Mário Draghi to cushion the voluptuousness of financial speculators to infinity. And, knowing the distances that the financial system and the political classes maintain in relation to the peoples, for the latter there are bad consequences and lack of proper support for a good life. The next dissemination of digital currency by central banks, with the disappearance of physical money, will introduce a new element of population control; whose
  • 4. funds may, at any time, be blocked or banned, within a political, social and economic structure of true enslavement. This, however, is for a next text. Throughout the period, there is an absolute highlight in the weight of bank liabilities in relation to Luxembourg's GDP; and, this emphasis accentuates over time – 6889% in 1995, 10015% in 2000, 14689% in 2007 and 23878% in 2020. This is a typical case of the speculation effect, introduced by Keynes, as a “development” of classical effects such as hoarding. Luxembourg, as the financial stronghold that it is, encompasses a volume of capital without any relation to its normal economy – one that contemplates the satisfaction of people's needs. The indicator closest to that presented by Luxembourg in 1995 belongs to the Netherlands (630.2%) and, which reaches 1463% in 2020; in this last year, the countries that appear right after Luxembourg are Cyprus (2535%) and Malta (2468%), relegating the Netherlands to the fourth position. Conversely, the countries where the ratio between liabilities and GDP is the lowest—lower than the GDP value—are, in 1995—Croatia, Estonia, Latvia, Lithuania, Poland, Slovenia, countries that, at the time, had a model own economic. The countries that maintained this situation until later were Romania (until 2008), Lithuania (until 2005), as well as Bulgaria and Poland until 2003, approximate moments of the respective dates of inclusion in the EU. More broadly, remember what we wrote about financial wealth and its share in the richest countries: In 2000 and 2008, the highest indicators of financial wealth were, in the USA (80.1 and 85.2% of the respective total) and Switzerland (76.8% and 72.2%). In 2019, the US maintains the world's highest coefficient of financial wealth (84.4% of the total), followed by Denmark (82.6%) and the Netherlands (79.9%). The financial markets are credits cascades, in which only in the original holder is a reality; henceforth, it is a theoretically endless chain; and where among the majority of stakeholders, no one knows who the initial debtor is. Faith dominates; it is not a question of faith in saints and miracles, but the faith that the aforementioned cascades are perpetual… without ruptures or panic attacks inducing enormous losses. 3 - Financial sector liabilities and their evolution The average annual variation of financial corporations' liabilities, as a percentage of GDP, can be broken down into the three periods considered above – 1995/1999, 2000/2007 and 2008/2020. The first ends, sensibly, with the dot-com crisis in the USA; the second encompasses the shake resulting from the episode of the Twin Towers and ends with the onset of public debt crises and bank restructuring; and the third includes the long period of relative economic
  • 5. stagnation, with the emergence of huge public debts and the insane creation of virtual money to maintain the so-called financial markets, in a mode of infinite growth, in a vacuum. Average annual change in financial sector liabilities (%) It is evident in the graph, the trend towards a reduction in the global averages of changes in the liabilities of the financial sector, leading to greater homogeneity – 31.7% in 1995/99, 26.2% in 2000/07 and 10.9% in the most recent period, 2008/ 20.  In each of the periods considered, the countries with the highest and lowest indicators are, respectively;  1995/99 – Estonia (46.9%), Malta (43.9%) and Cyprus (43.5%); Romania (10.7%) and Bulgaria (13.8%).  In the designated period, none of those countries was a member of the EU. Among the then members, the evolution of liabilities was relatively homogeneous, amounting to between 30/37% of GDP.  2000/07 - Malta (87.9%) and Cyprus (56.5%); Slovakia (12.2%) and Czech Republic (14.3%).  In the transition to the EU scope (2003/04) bank liabilities in Cyprus increased by 3.6 times. As for Malta, there was an increase of 4.3 times, over a longer period (2003/07).  2008/20 – Finland (15.3%, Luxembourg (15.2%) and Czech Republic (14.4%); Austria (7%), Malta and Portugal (7.8%) and Belgium (7.9%). In addition to the exceptional case of Luxembourg, where bank liabilities correspond to thousands of times the value of GDP, as mentioned above, there are other situations in which, comparing the indices, the indebtedness of the financial
  • 6. system is growing much more than the normal GDP growth. Thus, countries can be classified according to the growth of financial liabilities, in 2020, relative to GDP, based on the indicators for 1995: Growth [0 to 2 times] – Germany, Austria, Belgium, Bulgaria, Ireland (2001/2020), Portugal, Romania, Slovakia, Czech Republic; Growth [2 to 3 times] – Denmark, Spain, France, Greece, Hungary, Italy, Netherlands, Slovenia, Sweden; Growth [3-5 times] – Croatia, Estonia, Finland, Latvia, Lithuania, Luxembourg, Poland; Growth [>9 times] - Cyprus and Malta. 4 - Financial liabilities and minimum wages A comparison between the abovementioned multiplication of financial system liabilities (see point 3) and the average annual increases, for the periods 1999/2007 and 2007/2021, of the average minimum wages for several EU countries is interesting. That is, the comparison between the evolution of the capital entrusted to banks and the variation in the income of real people, essential for satisfying their basic needs. monthly minimum wage Annual change (%) 1999 2007 2021 2007/99 2021/08 Belgium 1,095.89 1,283.00 1,625.72 2.1 1.9 Bulgaria 34.26 92.03 332.34 21.1 18.7 Czech 98.85 278.57 596.36 22.7 8.1 Allemagne - - 1,585.00 - 1.6 estonie 79.89 230.08 584.00 23.5 11.0 irish - 1461.85 1 723.80 - 1.3 Greece 512.13 767.55 758.33 6.2 -0.1 espagne 485.71 665.70 1 108.33 4.6 4.7 France 1,049.49 1,280.07 1,554.58 2.7 1.5 Croatian - 379.60 567.32 - 3.5 lettonie 80.49 172.34 500.00 14.3 13.6 Lithuania 104.05 202.73 642.00 11.9 15.5 Luxembourg 1 162.08 1,570.28 2 201.93 4.4 2.9 Hongrie 90.13 266.10 476.00 24.4 5,6
  • 7. Malt 482.98 601.90 784.68 3.1 2.2 Pays-Bas 1,078.40 1,317.00 1,701.00 2.8 2.1 Pologne 160.18 248.43 619.46 6.9 10.7 Portugal 356.72 470.17 775.83 4.0 4.6 Roumania 27.46 124.44 466.72 44.1 19.6 slovenie 347.72 521.80 1,024.24 6.3 6.9 Slovakia 79.42 225.96 623.00 23.1 12.6 Source: Eurostat The growth rates of monthly minimum wages and the large differences between the effective values of countries with an older EU integration and those that joined the EU, following the dismemberment of Comecon, are highlighted; these dissimilarities are more evident in the period 1999/2007 than in the following period, in a trend towards smaller dissimilarities. In short, the liabilities that accumulate in the balance sheets of the components of the financial system grow, clearly more than the purchasing power of the European peoples; richer countries as well as poorer ones. This and other texts in: http://grazia-tanta.blogspot.com/ http://www.slideshare.net/durgarrai/documents https://pt.scribd.com/uploads Grazia.tanta@gmail.com 12/13/2021 1 [1] The volatile realm of financial wealth http://grazia-tanta.blogspot.com/2020/08/o-volatil-dominio-da-riqueza- financeira.html https://grazia-tanta.blogspot.com/2020/08/the-volatile-domain-of-financial- wealth.html (english) The evolution of wealth in Europe (2000/19) https://grazia-tanta.blogspot.com/2020/08/a-evolucao-da-riqueza-na-europa- 200019.html