To clarify: this is not from "financialization" generally speaking. This is specifically from consolidation for the sake of increasing efficiency and thus margins (as you pointed out).

This is opposed to increased competition (which also increases volatility) in the markets.

The reason why the markets are so consolidated is because it removes short-term risk. If there is an obvious market and only one (or a few) companies involved then everyone makes money (magic, I know). This is why Wall Street lobbies for regulations so hard. They have ownership in all the existing major companies that can afford those regulations and it consolidates the profits (and thus returns). De facto Crony Capitalism at its finest. Your aristocratic oligarchs.

So, stop giving your money to large index funds. (And every time there is a comment on HN telling you to, and there are plenty, downvote them and tell them a proper F-off).

The idea that no one can/should ever lose is what is killing the economy. It got its birth in the boomer-retirement-fund markets of the past few decades.

To recap, it is consolidation for margins that is the problem. That is not the same as general "financialization" (increased trading) that helps increase volatility in the markets and actually increases the size of the economy.

We desperately need real markets and not this crony capitalism that seems self-persistent.

The current system is such a marriage between corrupt politicians and wall street (which is now heavily extended into SV, btw) that it is absolutely disgusting.