From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Tue May 15 2007 - 21:08:53 EDT
was it attached this time? please include within body of the message. Aside from the question of how we are to explain oligopolization, I am wondering whether the dearth of investment opportunities may have resulted from the shortage of labor in the actually viable investment spaces as a result of restrictive immigration laws. Prem Shankar Jha offers this as explanation for both rampant financial speculation and the export of capital that has led to an impetuous industrialization in a select few zones of post colonial nation states. Rakesh > whoops the attachment was missing > Paul Cockshott > > www.dcs.gla.ac.uk/~wpc > > > > -----Original Message----- > From: OPE-L on behalf of Paul Cockshott > Sent: Tue 5/15/2007 10:45 PM > To: OPE-L@SUS.CSUCHICO.EDU > Subject: Re: [OPE-L] The Financialization of Capitalism > > Here is my take on it, written for an encyclopedia > > Paul Cockshott > > www.dcs.gla.ac.uk/~wpc > > > > -----Original Message----- > From: OPE-L on behalf of Rakesh Bhandari > Sent: Tue 5/15/2007 6:43 PM > To: OPE-L@SUS.CSUCHICO.EDU > Subject: [OPE-L] The Financialization of Capitalism > > From John Bellamy Foster. > > I am wondering whether there is an alternative explanation for the > mounting stock of surplus in the form of liquid money capital... > > http://www.monthlyreview.org/0407jbf.htm > > The monopoly capitalist economy, Baran and Sweezy suggested, is a > vastly productive system that generates huge surpluses for the tiny > minority of monopolists/oligopolists who are the primary owners and > chief beneficiaries of the system. As capitalists they naturally seek > to invest this surplus in a drive to ever greater accumulation. But > the same conditions that give rise to these surpluses also introduce > barriers that limit their profitable investment. Corporations can > just barely sell the current level of goods to consumers at prices > calibrated to yield the going rate of oligopolistic profit. The > weakness in the growth of consumption results in cutbacks in the > utilization of productive capacity as corporations attempt to avoid > overproduction and price reductions that threaten their profit > margins. The consequent build-up of excess productive capacity is a > warning sign for business, indicating that there is little room for > investment in new capacity. > For the owners of capital the dilemma is what to do with the immense > surpluses at their disposal in the face of a dearth of investment > opportunities. Their main solution from the 1970s on was to expand > their demand for financial products as a means of maintaining and > expanding their money capital. On the supply side of this process, > financial institutions stepped forward with a vast array of new > financial instruments: futures, options, derivatives, hedge funds, > etc. The result was skyrocketing financial speculation that has > persisted now for decades. >
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